Report on Key activities of the Telstra Corporation Limited - Essay Prowess

Report on Key activities of the Telstra Corporation Limited

Report on Key activities of the Telstra Corporation Limited

  

Telstra Corporation Limited (Telstra) is a large Australian based telecommunication and media company that operates and builds telecommunication networks and also marketing mobile, television, voice, internet among other entertainment products and services (Telstra investor centre, 2014). Telstra network services include designing, activating, operating and maintaining networks to its customers. This company operates in the various business segments, and each segment has its activities that are responsible for as delegated by the company`s administration. Some of these segments are such as the applications and ventures group segment that is involved in making strategic technological investments and innovations. The consumer and marketing segment is responsible in providing telecommunication products and services to the customers, and also providing an overall management of this company`s marketing initiatives which include network dealers, outbound call centers and retail outlets. This segment offers the company`s services to customers remote and rural, regional and metropolitan corners of Australia. The business segment serves customers of small to medium enterprises with a variety of fixed lines, broadband, mobile and data products and services (Real-time News, 2014).

            Telstra`s international group segment is mandated to manage the company`s offshore assets as well as marketing the reputation of the company to other states. The operations segment is mandated to analyze and develop new and available technologies of the company; plan, design, commission and decommission the communication networks of the company; constructing and maintaining company`s infrastructure; supplying and delivering information technology solutions to support customers, and internal company needs.

This segment is also involved in recruiting new staffs, training them and dealing with employee’s affairs. The wholesale segment is involved in providing wholesale products and services to other licensed carriage service providers, telecommunication carriers, application service providers and system integrators in all corners of Australia and globally (Real-time News, 2014). The media group segment manages and ensures growth and developments of media assets such as white and yellow pages, senses and the company`s shares.

Description of how Telstra Corporation is both a surplus and deficit unit.

Telstra Corporation limited is in various ways both a surplus and a deficit unit. The surplus end is evident by the returns that the company realizes after the sale of its products and services.  For example, on early September this year, the company announced to have generated a total of $26.452 billion, and this accounts its total sales and other revenues, and this reflects a 14% profit increase compared to last year (Ibis world, 2014). Out of this returns, the company increased its final dividend to its shareholders by 7%.

The surplus amount of money is targeted in increasing the company`s stock of its products and services. Alternatively, the profits of the company are deposited in various financial institutions such as banks helping the latter to have available amounts of money for lending its members who wish to borrow loans, which act as their capital for business venturing.

On the deficit end, Telstra corporation`s profits are reduced by the high amounts of taxes that are levied on its returns. These taxes limit the company in accumulating the necessary amounts of capital necessary in investing in other sectors and expanding its growth to the other corners of the world. For example, the company intends to enhance speed and capacity of customers who are using 4G networks by investing an amount not less than $1.3 billion (Ibis world, 2014). This amount cannot be realized cheaply without the company seeking alternative means of getting the capital such as borrowing loans from financial institutions.

In addition, some segments of the company realize losses while others realize profits in the end a given financial year. For example, in the 2014 financial year, the company realized maximum profits from the sale of mobile phones and internet data, and also made an increase of 937 thousand mobile phone customers.  However, the company at the same time realized a loss of 0.8% in fixed voice business (Telstra investor centre, 2014).  In addition, the corporation participates in Australian security exchange and this sector; the company occasionally realizes profits and losses depending on the nature of the market.

Ways in which Telstra Corporation can use financial institutions to facilitate its business activities.

Telstra Company can use financial institutions in many ways in order to facilitate the smooth running of its activities. First the company borrows loan from Australian commercial banks in order to acquire capital for its investing activities. For example, the application and ventures segment, which is mandated by the company to undertake investing activities, may use finances that have been acquired from Australian commercial banks to innovate and invest in strategic technologies and infrastructure development of the company (Viney & Phillips, 2012). Additional investments would help the company to increase its market share and in the long run realize more returns.

Consecutively, the company can use loans from the commercial banks to enhance the efficiency and effectiveness of its products to its customers (Mirza, 2012). For example, the company intends to increase speed and capacity of customers who are using 4G networks in the 2015 fiscal year. This would enhance the effectiveness of the 4G network service, which would then attract more and more customers and in the long run increase the sales of the company.

In addition, the company can use life and general insurance institutions to cater for the compensation for injured employees in the organization, and also in to pay retirement benefits to retiring employees (Viney & Phillips, 2012). Maintaining these employees consideration would help the company to establish good employees’ relationship who in return would deliver maximally helping the company to achieve its goals and objectives.

References

Ibis world, (2014). Telstra Corporation Limited-Premium Company Report Australia. Retrieved on 16th September 2014 on http://www.ibisworld.com.au/car/growth.aspx?entid=5

Mirza, A. A. (2012). Wiley international financial reporting trends. Hoboken, NJ: Wiley.

Real-time News, (2014). Telstra FY14 Profits, Hikes Dividend & Unveils Share Buyback. Retrieved on 16th September 2014 on http://www.rttnews.com/2370189/telstra-fy14-profit-up-14-hikes-dividend-unveils-a-1-bln-share-buyback.aspx

Telstra Investor Centre, (2014). Telstra Annual Report. Retrieved on 16th September 2014 from http://www.telstra.com.au/aboutus/investors     

Viney C. & Phillips P., (2012).  Financial Institutions, Instruments and Markets 7th Edition – McGraw-Hill’s publication, Australia.