Logical Fallacies Essay Example | Topics and Well Written Essays - 500 words

Logical Fallacies - Essay Example ed my friend’s fallacious reasoning by arguing that something does not automatically become right simply because it has always been practiced (Trufant 34). I argued that despite the fact that it may be true that Tobacco has been used for centuries as a medicine by the Indigenous Americans, Europeans and other societies, this does not necessarily justify that Tobacco use is good. On the contrary, it is a proven fact that tobacco is currently one of the largest causes of preventable deaths in the world and millions of tobacco users die each year across the globe from smoking related health conditions. For example, tobacco use is responsible for numerous diseases and long term health problems such as cancer, heart condition, respiratory diseases, as well as premature death. In addition, billions of dollars are currently being lost each year from the loss of productivity that results from smoking related deaths as well as in terms of the expenses incurred in the treatment of diseases and conditions associated with tobacco use. Finally, recent studies have also pointed out that tobacco use may significantly undermine the health of non smoke rs through passive smoking. I concluded that the argument that tobacco must be good because it has been used as an indigenous medicine in various cultures for many centuries is not only deceptive and fallacious but is also based on lack of reason since it is not supposed by any evidence. In my opinion, appeal to tradition is a logical fallacy because tradition is not always right. Although the notion that something is good because it has always been done that way may seem superficially sound, and is popular in many debate rounds, traditions can not justify that something is good. The use of tobacco does not automatically become right simply because it has always been traditionally used as an indigenous medicine for medicine. I won the argument. Tradition is not always

Business Idea Journal 2 Essay Example | Topics and Well Written Essays - 500 words

Business Idea Journal 2 - Essay Example Although massage therapy business has been tapped into by many magnates within Canada, there seems to be a huge market niche in Halifax. Halifax is a capital metropolitan with a population of about 400,000. Approximately almost a third of the whole population seeks for massage therapy services on a regular basis. This overwhelming demand cannot be sustained by the existing massage parlors in the town. Moreover, many would want to visit a massage parlor that can provide additional services such as barbering services. There is, therefore, the need to establish a reputable massage parlor that, besides providing the therapies, other services such as hair cut can also be offered. This projected massage therapy parlor will offer two particular services; massage therapy and barbering services. It will be equipped with machines and apparatus, as well as staff specialized in this type of service delivery. Having explored this idea extensively, it has been found that men tend to seek for massage therapy services more than women in Halifax especially in the evenings when they get out from work. This is not to say that women and children do not. This establishment will target the general population; anyone who requires massage and barbering services. The fact that it is combined with a barbershop will attract and sway customers who probably needed to haircuts into asking for massage therapy. Additionally, the business will be more conspicuous in the market since it would be one of its own that has seen this kind of a combination in Halifax. To reach out to the potential clients, internet resources will be utilized. Social media is one of the many forums that this projected business can be promoted. Facebook, Twitter, Instagram among other electronic platforms would provide opportunities through which the massage therapy business

Importance of Intellectual Capital in the Modern Economy

Importance of Intellectual Capital in the Modern Economy Executive Summary The report discusses the relative importance of the Intellectual Capital in the present economy due to the revolution that fosters the propagation of the value creation. The Intellectual Assets of an organisation play a vital role in improving its value and maintaining the competitive advantage. However, these intellectual assets are not capitalised in the financial statements as they are unable to determine their historic costs and their future benefits are sometimes uncertain. Despite of this a lot of companies have discovered ways that facilitate the valuation , measurement and reporting of their intellectual assets i.e companies like Coca Cola , Marks Spencer and Kingston Hull Plc have reflected their intangible assets such as brands separately from the goodwill on their company balance sheets as some guidance is provided by the International Accounting Standard in the disclosure of the intangible assets. The report also presents some theories that are aimed at eliminating the confusions created about the Accounting Profession. As the Accounting Profession and the Accountants cannot be blamed as conservatives in not providing space for the Intellectual Assets in the financial statements because in doing so , the financial statements will loose their relevance , reliability and neutrality. The report further throws some light on the issues that are related to the field of Intellectual Capital that include that there is no uniformity in the relative theory as there is no such definition and the Intellectual Capital model that is accepted generally. In the end the report concludes by suggesting that the under the supervision of the International Accounting Standard researchers, consultants, scholars and the accountants have to find a common way such that the value relevance of the Intellectual Capital and the principles of accounting are preserved. Aims and Objectives The aim of this study is to discuss that whether the exclusion of the Intellectual Assets of an organisation in the balance is realistic and pragmatic. As the Intellectual Capital is considered a value driver for the modern economy and a lot of organisations are focusing on their intellectual assets as compared to the intangible assets. Objectives The objectives of this study include: To assess the importance of the Intangible assets as compared to the tangible assets of an organisation. To provide some evidences about the organisations attitudes and the awareness about their intellectual assets. Finally, to conclude that whether the eviction of the Intellectual assets is pragmatic or not. Rationale The Current Gobal economies are now facing a new revolution that brings them to a new form of business environment. This major change in the world economies is due to the fact that there has been a disproportion observed between the Book Value and the Market Value of a firm. Because , in the past the Balance Sheet and the Income statement were the only tools used by the Shareholders ,managers and the executives to make strategic decisions and monitoring the performance of the company. However, it can be argued that things have changed now. As one of the important concern for the companies is the Value Creation. The expansion of the markets in the product or a service sector has been possible with the aid of the internet , high- technology and the innovation ,information , market chains and globalisation. This in turn has created a global competition among the firms that are now striving to acquire knowledge. Furthermore, the acquisition of the knowledge brings some vital concerns of its use, management and the improvement. This has changed the operations of the the organizations that used to emphasize on the production capability ,now focus on the creative operational structure. The organisations are now using the special tools for acquisition, management and the protection of knowledge such as Research Development , Patents , trademarks , copyrights , databases , customer and supplier relationships and Human Resources are known as the intellectual assets of the organization and constitute the Intellectual Capital. The relative importance and the expected returns of the Intellectual Capital has convinced the organisations to think and work in a new innovative way to achieve dominance over the competitors in the market. However , inspite of this the Intellectual Capital has not been considered in the performance appraisals and not included in the financial statements under the heading of assets. The organisations are spending a lot on the Intellectual Capital as compared to their tangible assets so therefore it is not wise to go against the flow of current market trends by focusing more on the tangible assets. This would lead to the creation of inaccurate procedures, policies and the decisions. Hence reducing the value in front of the investors and the customers. Cowey (1999), approves the conception of a â€Å"New Economy â€Å" and the â€Å" Knowledge Company † and insists that this concept accepted world-wide. He demonstrates that the opinions of â€Å" what we own † to â€Å" what we Know † have changed and know it depends upon the companies to apprehend the value creation by putting stakes in the training technology , staff retention and knowledge otherwise the efforts will not be productive. The Organisation for Economic Co-operation and development (OECD , 2005) reports that the investments in the Intellectual Capital has grown faster than the investments on machinery and equipment few years back. It is further revealed that the spending on the Research Development , software and the higher education was higher than the spending on the Machinery and the equipment in USA and Finland notebaly in 2002 and increased in greater proportions between 1994 2002 among the OECD countries as well. Arora(2000) purports that the the edge on the competitors in the challenging business environment can only be achieved by the proper administration of the Intellectual Capital which is another name of the Knowledge management. Kaplan Norton(2001) suggest that the company’s market value includes only 10-15% of the company’s book value of the assets. Furthermore, the possibilities of producing a value are risen through the the activities whose foundation is the knowledge that is enforced on the intangible assets of an organisation as compared to tangible assets. A Convention held under the OECD(1999) , concludes that a prominent set of information is required on the Intellectual Capital in its association with the tangible assets in the determination of value. Traditional Financial Reporting does not provide the necessary information to pursue the value creation process. Due to the availability of the information via internet technologies there is a need of a new reporting model that accommodates the information pertaining the Intellectual Capital that creates the value for customers and suppliers. Bradley(1997) discovered that the predicaments that were involved in the traditional financial accounting were due to the emergence of value. He explained the problem by arguing that the balance sheets and the income statements were the benchmarks in delivering the financial information to the shareholders. However, the significance of these financial statements in propagating the value has decreased due to the emerging trend of investments in the intangible assets. It is stated that the value of the brands was not reflected in the financial statements and in the equity values .This has led to the reconsideration of the intangible assets and the brands specifically. This fostered the proposition of of including such assets in the financial statements. However , the accounting profession does not fully supports the the idea that the intangible assets are the main factors in creating the value. On the contrary the investors and the trade leaders have acknowledged this truth. Furthermore, it is also quoted that 72% of the value was not reflected in the balance sheets of the companies surveyed in United Kingdom. Brands form the major part of the unexplained value that is not part of the balance sheet (Brand Finance plc , 2000). The Figure 1 shows the Gap between the market capitalisation and the net asset value. Why Intellectual Capital Upton(2001) reports that the companies under the scrutiny of the FASB Business Reporting Research Project provide considerable non- monetary information. Therefore it can be argued that the AICPA and FASB have been analysing the Intellectual Capital since 1991.The Intellectual Capital is considered endangered when the information of a company becomes obsolete when the competitor increases its information. Therefore the preservation of the Intellectual Capital is crucial for maintaining the competitive edge. However,the companies that are knowledge intensive are prone to risks of losing their market shares(MacDougall Hurst,2005).Guthrie(2000) suggests that â€Å"Accountants must find a to incorporate measures of Intellectual Capital or they will become irrelevant â€Å". Statement of Methodology The method used in the report is the study of the literature that is already present in the field of Intellectual Capital and the Accounting to support the arguments.After, the study necessary facts and evidences are combined to form the Literature Review of this report. This report does includes the collection of the primary data and its analysis. A case study is added to further enhance the understanding of the applications of IC in firms. Research Question The research question is â€Å" Is the exclusion of Intellectual Assets from accounting statements realistics?† The research question of this report is basically a debate that is going on in the academic, industrial and the business sector. This topic demands study to be commenced taking in account both the views of the implications of including or excluding the intellectual assets in the financial statements. Literature Review Definition of the Intellectual Capital The Organisation for Economic Co-operation and development (OECD , 1999) illustrated that the Intellectual Capital was the composition of the financial value of two classes of the intangible assets i.e Structural Capital Human Capital The structural Capital includes the organisational resources like the softwares, databases etc. The Human Capital however, contains the human resources employees (internally) , customers and suppliers(externally). The term Intellectual Capital is presumed as having the same meaning as the Intangible Asset. In contrast , the definition that is provided by the OECD(1999) puts the Intellect Capital as a subset of the intangible assets of an organisation. Because there are certain intangible assets that do not fall under the category of the Intellectual Capital. The repute of a firm is not considered as a part of the Intellectual Capital(Guthrie Petty , 2000). Stewart(1997) defines the Intellectual Capital as a â€Å" Intellectual Material â€Å" that Includes the knowledge , information , intellectual property , experience that can be used to generate wealth. Furthermore , Stewart (1997) categorises the intellectual capital in to structural , customer and the human capital. He argues that the human capital is the generator of the innovation and the improvement. The structural capital includes the tools and the facilities that are used the human capital to form value. Customer Capital includes the value that is produced as a consequence of the organisations relations with which performs the business transactions(Stewart , 1997). Intellectual Capital can also be defined as the combination of the human capital and the structural capital. The human capital includes the knowledge , skills and the experience of the employees. It is further argued that the human capital is not in the possession of the organisation as compared to the structural capital (Edvinsson Malone , 1997). Elements of the Intellectual Structural Capital Structural Capital is what is left behind in the organisation when the employees go home. The Structural Capital arises from the those organisational processes that are focusing on the improvement and the establishment of the organisation. (Roos et al , 1997). Bontis et al (1999) suggests that the structural capital includes the organisational resources that encompass the knowledge that is not actually stored in the human brains and whose value is greater than its physical value.These assets include databases , softwares , manuals , trademarks , leaseholds , franchises , patents , licenses , employee training , employee contracts etc. The structural capital plays an important role in the creation of the value. As it helps the human capital to explore new ideas , learn from the past experience and protects the knowledge and the new inventions by providing the technology and the legal aid. Customer Capital Kohli jaworski(2000) defined the customer capital as the organisations ability to evolve the knowledge about market that is focusing on the cutomer desires and perceptions. This acquired knowledge is used by the organisations in response to the changing attitudes of the customers and the market. Organisations use this knowledge to have a contingency plan to tackle the threats produced from changing market trends. The definition provided by Bontis(1999) suggests the customer capital should be iterated as the relational capital that includes the relationships with the suppliers, partners and the investors in addition to the relationship with the customers. Human Capital Hudson(1993) defined the human capital as the composition of the inheritance, qualifications , experience with the opinions about life and business. It is further argued that the organisational employees are the key architects of the Intellectual Capital through their proficiency , opinions and expertise. The competence of the employees includes skills and qualifications and their opinions come under their behaviour and perceptions about work. The expertise is important in devising the innovative solutions to the problems. Furthermore, employees are an important asset for an organisation but they are not owned assets(Roos et al , 1997). Exploitation Of Intellectual Capital (Economical Perspective) It is suggested that the critical factor in the improvement of the economy is the proper utilization of the Intellectual capital .It is further noted that by increasing the tricks of Intellectual Capital will provide a competitive edge and the value of the firm will be augmented and specifically business will bring financial benefits. It is not a new thing that the intangible assets like brands, intellectual property , relationships are considered as a unprocessed input for the organization that increases the worth by the application of intelligence in possession of the organization. (Watters et al 2006 , Intellectual Assets Center , Glasgow, Uk). The research on the recognition and reporting of the intangible assets and the intellectual capital has brought them to the acute attention.The research believes that the intangible assets play a significant role in the creation of endurable competitive advantage with in the advanced organsations.Due to the expansion of the modern knowledge based economy it has become transparent that the intangible assets and the Intellectual Capital of an organization have become a platform in accomplishing the competitive advantage as compared to the hi-tech tangible assets(Drew , 1999). Tayles et al (2005) have described two doctrines in the realization of the intangible assets that provide the assistance in the achievement of the competitive superiorty. The research is continuously striving to find the authentic procedures to measure the intangible assets and the indices that provide a forecast of the future economical benefits based upon the doctrines that are prescribed by Tayles et al (2005).Firstly , the expanding financial statements of the companies is the idiosyncracy of its Intellectual Capital that give the edge on the market competitors. Secondly, is the inefficient justification of the Intellectual Capital in the expansion of the economy(Tayles et al , 2005). Skinner (1986) purported that with the utilization of the technology, manufacturing productivity can be achieved by the intangible assets of the company which are the authentic reagents of the prosperity and that justify the monetary investment. How the Companies Exploit the Intellectual Capital Case Study Kingston Communications(Hull) Plc is group of companies based in Hull,United Kingdom. The groups is presently offering the services related to information, communication technology and the telecommunications to the consumer markets in UK. The groups Brands include Affiniti,Smart 421,Jam IP(Integration and management services),Karoo, Eclipse, Mistral (Internet and Telecommunication services) and Hull Color pages and Know( Information Services). The group is Ammortising the its Intangible Assets that aquired in the Acquisitions.In 2007,the ammortisation on intangibles was à ¢Ã¢â‚¬Å¡Ã‚ ¤8 million(from Total depreciation and ammortisation).The group also has purchased the tangible and the Intangible assets worth à ¢Ã¢â‚¬Å¡Ã‚ ¤30.2 million.The Groups Controlled measures include, measuring the learning and development(p9),Customer Satisfaction. KM also believes that Human Resources when managed through and effective Policy can bring the Tangible effect on the companys performance. KM is running a development program to enhance the Knowledge and Intelligence of the employees.The company also manages the Relational (Custmer) Capital by arranging the meetings of the Directors on the Investor relations and the shareholders concerns specifically. The Company’s publishes its Financial Reports complying with the IFRS,however, the company also provides additional disclosures if compliance with the IFRS does not fullfil the requirements of the users(i.e External Stakeholders,External investors,Suppliers and the Customers) to understand the impact of certain transactions that have an effect on the financial performance of the company. Relational Capital Management and Policies Arranaging meetings with the shareholders time to time to discuss the company’s strategies and performance.Maintaining a investors relations function to encourage and improve the communication with the investors. The Goodwill of the Company in 2007 was worth à ¢Ã¢â‚¬Å¡Ã‚ ¤192.754 million(2006:à ¢Ã¢â‚¬Å¡Ã‚ ¤155.551 million) and the Intangible Assets had the value of à ¢Ã¢â‚¬Å¡Ã‚ ¤48.511 million (2006 : à ¢Ã¢â‚¬Å¡Ã‚ ¤39.450) according to the Balance Sheet on 31st march,2007. The Cash Flow Statement of the Company for the year ended 31st march,2007 also explicitly show the Amounts of the Ammortisation of Intangibles as compared to the tangible fixed assets.The Cash Flow statement also show the companys procurement of the Intangible assets à ¢Ã¢â‚¬Å¡Ã‚ ¤6.495 illion in 2007. The financial statements of the Company are prepared according to the principles prescribed by IFRS and IFRIC.These financial statements are based on the concept of historical Cost accounting.However, the statements are modified due to the revaluation of the financial assets to a fair value by using the income statement. Intangible Assets Identified by Kingston Communications The Intangible Assets of the Kingston Communication include: 1.) Goodwill 2.) Customer and Supplier Relationships 3.) Technology and Brands 4.) Software 5.) Development Goodwill The Groups Goodwill is reported in the acquisitions of the subsidiaries and it is the difference between the Cost of Acquisition and the Net Assets. The Goodwill is tested for impairment annually. Development The company’s intangibe asset that is developed through the research and development activities only when it fulfils the criteria of Intangible Asset Recognition prescribed by IAS 38 i.e the asset is identifiable,impact on future cash flows and the developmental costs of the assets are measured reliably.The estimated life of the internally developed intangible asset is 1 year and is also ammortised on a straight line basis. Valuation of the Intangible Assets in Kingston Commnuications The intangible assets that are acquired through the acquisitions are valued on the basis of their time value and the future impact of on the performance of the companies. Appraisal of Intellectual Capital in Kingston Communications The Kingston Communication is exploiting,managing and reporting its Intellectual Capital as tool necessary for the competitive advantage and for improving the future performance of the company. According to the companies policy the Intangibles Assets are included in the Balance Sheets in order to satisfy its investors and guarantee the future investments in the company. However, there are no benchmarks for the management and the evaluation of the these Intangible assets.Also, the company is not using the models for the Classification of these Intangible assets as suggested by (Kingston Hull plc , 2008) Measuring the IC (Performance)through strategies(Management Accounting) Simons(1999) suggests that the by measuring the performance of a company is basically the comparison of the outcomes of the business activities with the critical business targets. The traditional financial accounting utilizes two techniques to measure the Performance .These are Return on Capital Employed(ROCE) and Return on Assets (ROA). However , these techniques are condemned due to the fact that they are old fashioned , unable measure the intangible assets and are unable to appraise the stakes in the technology which is essential for the firm to compete in the global market(Bourne et al , 2000; Amir Lev , 1996). Valuation Methodologies(Performance Measures as well) The economic measure of the Profit yields the same result as the traditional accounting during the matching phase of costs and revenues by preserving the value significance. This is done by improving the financial reports with the disclosure of the concealed assets like the intangible assets and the investments in the long run(Simons , 1990). (It includes the tools and various methodologies ) Watters et al(2006) have discussed the application of a Scorecard assessment tool in the Scottish SME that provides a review that how efficiently companies are exploiting their Intellectual assets.The tool helps the SMEs to manage three areas of operations i.e Sales and Marketing , Research and Development and Human Resources. It assign the scores to activities that come under the three operational areas according to their effectiveness and links them to the strategic objectives of the firms. (Appendix 1) Brand Finance plc(2000) suggests that there are a lot of methods present for the valuation of the Brands, however there is a need to find an optimal one. Cost based methods of brand valuations show a disparity from its market valuation. The Market Comparison method is not efficient as it is difficult to obtain the comparison data. Royalty Relief method determines the royalty rate on the estimates of the income generated from brands. However , this method does not clearly states that how a brand is going to create value. The Economic Use method combines the consumer and the competitor to entitle the value to the brand.The last method is the most optimal method which is the Brand Finance that uses the Discounted Cash Flow (DCF) analysis in concluding the value for a brand.As the Discounted Cash Flow method valuation complies with the valuations performed by the financial analysts , accountants to check for the impairment of the intangible assets. Measurement of Intellectual Capital Why there is a need for the companies to measure the intellectual capital This is a very long debate that why companies need to measure the intellectual capital.There are several advantages of doing that. The term intellectual capital can be said to be â€Å"expandable† in terms of the Value and rewards. The greater the effort of a company the greater is a competitive advantage and greater is sustainability of the company. Nowadays companies and the firms have become Knowledge aware i.e they have now recognized the importance of the of the knowledge that creates value and sustainability. The Companies working in the Telecommunication, Pharmaceutical and the research technology sector specifically have to invest a lot in the Research and Development to compete and develop the innovative solutions to avail the opportunities in the market.Therefore, there is a strong need for these companies to devote themselves to measure and manage their intellectual capital effectively. However, it is very difficult to justify the investments in digging out the knowledge that creates value .These investments are rather very complex and unpredictable even if they are tested and analysed by the efficient tools for their proficiency. Some Organisations that are knowledge based are sometimes not sure about the amount of the Knowledge they have and the amount of knowledge they need tocarry out their functions internally and externally. That is the reason, these organizations loose the interest of the investors and therefore the investment. Balanced Scorecard (An Alternative to Balance Sheets) Kaplan Norton(1992) , presented the theory of the Balanced Scorecard for improving and tracking down the performance of an organisation. The authors suggest four dimensions such as Financial , Customer , internal business process and learning and growth. These dimensions are believed to provide a insight in to the current performance and identify the factors that can improve the future performance. A combination of the non-financial and financial measures are insufficient in determining the performance of an organisation. The main problem is that its just like a Wild Goose Chase as this amalgam of the performance indicators are not pursuing a specific business objective. Kaplan Norton(1996) believe that the both the financial and the non- financial measures must have a focus on a goal that has to be achieved in maintaining the sustainability. The authors further argue that the various measures provided by the balanced scorecard can help the organisation to plan a particular strategy and then can implement it across its subsidiaries, departments to share a common motive with trasnparency. A well planned BSC can hep the organisation to learn from the short-term reports that are generated and scrutinized through various perspectives. Andriessen(2004) suggests that the predicament of measuring the Intellectual Capital can be resolved by applying the balanced scorecard. It has been advised that the specified strategy plans can be created that guide the organisations to confidently invest in the human resources, technology and the structural capital. It is further revealed that by measuring and administering the intellectual capital can also help the organisation to convert its non-monetary achievements in to monetary achievements(Kaplan Norton , 2004). A study conducted by Hagood Friedman(2002) devised a way for the implementation of the balanced scorecard to measure the accomplishments of the human resource information system of a company. They have developed a system that uses the balanced scorecard as its foundation to improve the human resource information system in association with highlighting the goals and objectives of the organisation. Despite of its usefulness the Balanced Scorecard has some limitations. In this context Voelpel et al (2006) has identified five limitations of the balanced scorecard in its application in the modern economy. First being its inflexibility that is, it measures the performance of a company only in four perspectives by leaving behind some other perspectives out of attention. Voelpel et al(2006 ) explain the second limitation which is that the BSC is less efficient in accommodating the changes in the changing economy. The BSC a defines a strategy for a company and its subsidiaries to achieve a goal by neglecting the individual goals of a subsidiary as a consequence a company is unable to use its potential properly. The third one is that BSC focuses more on improving the internal performance of an organisation therefore by losing a link with the external world to exploit the innovation.The forth limitation of a BSC is that it focuses on the organisation in itself and provides no information about the actions of competitors. The fifth problem with the balance scorecard is that it goes straight in measuring the performance in a rational way .As a consequence the more complex predicaments are difficult to apprehend(Voelpel et al , 2006). A Comparison between the benefits that arise from intangible and tangible assets There are risks involved with the investment in the intangible assets like RD. Kothari et al(1998) have conducted a research by comparing the uncertainty of benefits associated with the tangibles and the intangibles assets. The methodology used for this research was the regression analysis of the future earnings variability involved with the expenditure in Research and Development and the tangible assets .Furthermore , the variables like firm size and the leverage are also used to define the boundary of a research.It has been illustrated by Kothari et al (1998) that the future benefits of RD investment are more uncertain than the tangible assets. Shi(2003) has analysed and studied the relationship of bond prices and the measures of RD expenditures and suggest that there is a fair risk involved with the spending of the RD projects that increases risk factor with the bondholders claims and hence are more riskier than the other projects. Issues in Intellectual Capital(Flaws in the IC Concepts) Bontis (2001) discovered a predicament with the intangibles assets is that there is no unique conception that is accepted by everyone. Every investigator or a consultant who contributes to the debate expects the approval and recommends his own jargon. Various other researchers have pointed out flaws in the definitions of the Intellectual Capital. According to Edvinsson and Malone(1997) the intellectual capital was the difference of Market value and the Book value. In contrast Upton(2001) recommends that the intellectual capital cannot be absolutely characterized by simply calculating the difference of market and book value. Following that Habersam and Piber(2003) advocate that the term intellectual capital cannot be determined by the difference of market value and the book value. Pragmatically, the difference can be influenced by some other elements that are not associated with the intangibles.Further research enumerates five components that can realize a change in the the stock prices which incorporates the recognised assets , company liabilities , legal events , shareholders equity and the timing issues(Garcia-Ayuso 2003). The benefits received by a firm cannot be attributed to the individual intangible Assets as such benefits are a result from the inter-cooperation of more than one Intangible asset. Therefore, it could be wise to value the intangible assets all together. It is further argued that the market value of a firm cannot be ascribed to the intangible asset Importance of Intellectual Capital in the Modern Economy Importance of Intellectual Capital in the Modern Economy Executive Summary The report discusses the relative importance of the Intellectual Capital in the present economy due to the revolution that fosters the propagation of the value creation. The Intellectual Assets of an organisation play a vital role in improving its value and maintaining the competitive advantage. However, these intellectual assets are not capitalised in the financial statements as they are unable to determine their historic costs and their future benefits are sometimes uncertain. Despite of this a lot of companies have discovered ways that facilitate the valuation , measurement and reporting of their intellectual assets i.e companies like Coca Cola , Marks Spencer and Kingston Hull Plc have reflected their intangible assets such as brands separately from the goodwill on their company balance sheets as some guidance is provided by the International Accounting Standard in the disclosure of the intangible assets. The report also presents some theories that are aimed at eliminating the confusions created about the Accounting Profession. As the Accounting Profession and the Accountants cannot be blamed as conservatives in not providing space for the Intellectual Assets in the financial statements because in doing so , the financial statements will loose their relevance , reliability and neutrality. The report further throws some light on the issues that are related to the field of Intellectual Capital that include that there is no uniformity in the relative theory as there is no such definition and the Intellectual Capital model that is accepted generally. In the end the report concludes by suggesting that the under the supervision of the International Accounting Standard researchers, consultants, scholars and the accountants have to find a common way such that the value relevance of the Intellectual Capital and the principles of accounting are preserved. Aims and Objectives The aim of this study is to discuss that whether the exclusion of the Intellectual Assets of an organisation in the balance is realistic and pragmatic. As the Intellectual Capital is considered a value driver for the modern economy and a lot of organisations are focusing on their intellectual assets as compared to the intangible assets. Objectives The objectives of this study include: To assess the importance of the Intangible assets as compared to the tangible assets of an organisation. To provide some evidences about the organisations attitudes and the awareness about their intellectual assets. Finally, to conclude that whether the eviction of the Intellectual assets is pragmatic or not. Rationale The Current Gobal economies are now facing a new revolution that brings them to a new form of business environment. This major change in the world economies is due to the fact that there has been a disproportion observed between the Book Value and the Market Value of a firm. Because , in the past the Balance Sheet and the Income statement were the only tools used by the Shareholders ,managers and the executives to make strategic decisions and monitoring the performance of the company. However, it can be argued that things have changed now. As one of the important concern for the companies is the Value Creation. The expansion of the markets in the product or a service sector has been possible with the aid of the internet , high- technology and the innovation ,information , market chains and globalisation. This in turn has created a global competition among the firms that are now striving to acquire knowledge. Furthermore, the acquisition of the knowledge brings some vital concerns of its use, management and the improvement. This has changed the operations of the the organizations that used to emphasize on the production capability ,now focus on the creative operational structure. The organisations are now using the special tools for acquisition, management and the protection of knowledge such as Research Development , Patents , trademarks , copyrights , databases , customer and supplier relationships and Human Resources are known as the intellectual assets of the organization and constitute the Intellectual Capital. The relative importance and the expected returns of the Intellectual Capital has convinced the organisations to think and work in a new innovative way to achieve dominance over the competitors in the market. However , inspite of this the Intellectual Capital has not been considered in the performance appraisals and not included in the financial statements under the heading of assets. The organisations are spending a lot on the Intellectual Capital as compared to their tangible assets so therefore it is not wise to go against the flow of current market trends by focusing more on the tangible assets. This would lead to the creation of inaccurate procedures, policies and the decisions. Hence reducing the value in front of the investors and the customers. Cowey (1999), approves the conception of a â€Å"New Economy â€Å" and the â€Å" Knowledge Company † and insists that this concept accepted world-wide. He demonstrates that the opinions of â€Å" what we own † to â€Å" what we Know † have changed and know it depends upon the companies to apprehend the value creation by putting stakes in the training technology , staff retention and knowledge otherwise the efforts will not be productive. The Organisation for Economic Co-operation and development (OECD , 2005) reports that the investments in the Intellectual Capital has grown faster than the investments on machinery and equipment few years back. It is further revealed that the spending on the Research Development , software and the higher education was higher than the spending on the Machinery and the equipment in USA and Finland notebaly in 2002 and increased in greater proportions between 1994 2002 among the OECD countries as well. Arora(2000) purports that the the edge on the competitors in the challenging business environment can only be achieved by the proper administration of the Intellectual Capital which is another name of the Knowledge management. Kaplan Norton(2001) suggest that the company’s market value includes only 10-15% of the company’s book value of the assets. Furthermore, the possibilities of producing a value are risen through the the activities whose foundation is the knowledge that is enforced on the intangible assets of an organisation as compared to tangible assets. A Convention held under the OECD(1999) , concludes that a prominent set of information is required on the Intellectual Capital in its association with the tangible assets in the determination of value. Traditional Financial Reporting does not provide the necessary information to pursue the value creation process. Due to the availability of the information via internet technologies there is a need of a new reporting model that accommodates the information pertaining the Intellectual Capital that creates the value for customers and suppliers. Bradley(1997) discovered that the predicaments that were involved in the traditional financial accounting were due to the emergence of value. He explained the problem by arguing that the balance sheets and the income statements were the benchmarks in delivering the financial information to the shareholders. However, the significance of these financial statements in propagating the value has decreased due to the emerging trend of investments in the intangible assets. It is stated that the value of the brands was not reflected in the financial statements and in the equity values .This has led to the reconsideration of the intangible assets and the brands specifically. This fostered the proposition of of including such assets in the financial statements. However , the accounting profession does not fully supports the the idea that the intangible assets are the main factors in creating the value. On the contrary the investors and the trade leaders have acknowledged this truth. Furthermore, it is also quoted that 72% of the value was not reflected in the balance sheets of the companies surveyed in United Kingdom. Brands form the major part of the unexplained value that is not part of the balance sheet (Brand Finance plc , 2000). The Figure 1 shows the Gap between the market capitalisation and the net asset value. Why Intellectual Capital Upton(2001) reports that the companies under the scrutiny of the FASB Business Reporting Research Project provide considerable non- monetary information. Therefore it can be argued that the AICPA and FASB have been analysing the Intellectual Capital since 1991.The Intellectual Capital is considered endangered when the information of a company becomes obsolete when the competitor increases its information. Therefore the preservation of the Intellectual Capital is crucial for maintaining the competitive edge. However,the companies that are knowledge intensive are prone to risks of losing their market shares(MacDougall Hurst,2005).Guthrie(2000) suggests that â€Å"Accountants must find a to incorporate measures of Intellectual Capital or they will become irrelevant â€Å". Statement of Methodology The method used in the report is the study of the literature that is already present in the field of Intellectual Capital and the Accounting to support the arguments.After, the study necessary facts and evidences are combined to form the Literature Review of this report. This report does includes the collection of the primary data and its analysis. A case study is added to further enhance the understanding of the applications of IC in firms. Research Question The research question is â€Å" Is the exclusion of Intellectual Assets from accounting statements realistics?† The research question of this report is basically a debate that is going on in the academic, industrial and the business sector. This topic demands study to be commenced taking in account both the views of the implications of including or excluding the intellectual assets in the financial statements. Literature Review Definition of the Intellectual Capital The Organisation for Economic Co-operation and development (OECD , 1999) illustrated that the Intellectual Capital was the composition of the financial value of two classes of the intangible assets i.e Structural Capital Human Capital The structural Capital includes the organisational resources like the softwares, databases etc. The Human Capital however, contains the human resources employees (internally) , customers and suppliers(externally). The term Intellectual Capital is presumed as having the same meaning as the Intangible Asset. In contrast , the definition that is provided by the OECD(1999) puts the Intellect Capital as a subset of the intangible assets of an organisation. Because there are certain intangible assets that do not fall under the category of the Intellectual Capital. The repute of a firm is not considered as a part of the Intellectual Capital(Guthrie Petty , 2000). Stewart(1997) defines the Intellectual Capital as a â€Å" Intellectual Material â€Å" that Includes the knowledge , information , intellectual property , experience that can be used to generate wealth. Furthermore , Stewart (1997) categorises the intellectual capital in to structural , customer and the human capital. He argues that the human capital is the generator of the innovation and the improvement. The structural capital includes the tools and the facilities that are used the human capital to form value. Customer Capital includes the value that is produced as a consequence of the organisations relations with which performs the business transactions(Stewart , 1997). Intellectual Capital can also be defined as the combination of the human capital and the structural capital. The human capital includes the knowledge , skills and the experience of the employees. It is further argued that the human capital is not in the possession of the organisation as compared to the structural capital (Edvinsson Malone , 1997). Elements of the Intellectual Structural Capital Structural Capital is what is left behind in the organisation when the employees go home. The Structural Capital arises from the those organisational processes that are focusing on the improvement and the establishment of the organisation. (Roos et al , 1997). Bontis et al (1999) suggests that the structural capital includes the organisational resources that encompass the knowledge that is not actually stored in the human brains and whose value is greater than its physical value.These assets include databases , softwares , manuals , trademarks , leaseholds , franchises , patents , licenses , employee training , employee contracts etc. The structural capital plays an important role in the creation of the value. As it helps the human capital to explore new ideas , learn from the past experience and protects the knowledge and the new inventions by providing the technology and the legal aid. Customer Capital Kohli jaworski(2000) defined the customer capital as the organisations ability to evolve the knowledge about market that is focusing on the cutomer desires and perceptions. This acquired knowledge is used by the organisations in response to the changing attitudes of the customers and the market. Organisations use this knowledge to have a contingency plan to tackle the threats produced from changing market trends. The definition provided by Bontis(1999) suggests the customer capital should be iterated as the relational capital that includes the relationships with the suppliers, partners and the investors in addition to the relationship with the customers. Human Capital Hudson(1993) defined the human capital as the composition of the inheritance, qualifications , experience with the opinions about life and business. It is further argued that the organisational employees are the key architects of the Intellectual Capital through their proficiency , opinions and expertise. The competence of the employees includes skills and qualifications and their opinions come under their behaviour and perceptions about work. The expertise is important in devising the innovative solutions to the problems. Furthermore, employees are an important asset for an organisation but they are not owned assets(Roos et al , 1997). Exploitation Of Intellectual Capital (Economical Perspective) It is suggested that the critical factor in the improvement of the economy is the proper utilization of the Intellectual capital .It is further noted that by increasing the tricks of Intellectual Capital will provide a competitive edge and the value of the firm will be augmented and specifically business will bring financial benefits. It is not a new thing that the intangible assets like brands, intellectual property , relationships are considered as a unprocessed input for the organization that increases the worth by the application of intelligence in possession of the organization. (Watters et al 2006 , Intellectual Assets Center , Glasgow, Uk). The research on the recognition and reporting of the intangible assets and the intellectual capital has brought them to the acute attention.The research believes that the intangible assets play a significant role in the creation of endurable competitive advantage with in the advanced organsations.Due to the expansion of the modern knowledge based economy it has become transparent that the intangible assets and the Intellectual Capital of an organization have become a platform in accomplishing the competitive advantage as compared to the hi-tech tangible assets(Drew , 1999). Tayles et al (2005) have described two doctrines in the realization of the intangible assets that provide the assistance in the achievement of the competitive superiorty. The research is continuously striving to find the authentic procedures to measure the intangible assets and the indices that provide a forecast of the future economical benefits based upon the doctrines that are prescribed by Tayles et al (2005).Firstly , the expanding financial statements of the companies is the idiosyncracy of its Intellectual Capital that give the edge on the market competitors. Secondly, is the inefficient justification of the Intellectual Capital in the expansion of the economy(Tayles et al , 2005). Skinner (1986) purported that with the utilization of the technology, manufacturing productivity can be achieved by the intangible assets of the company which are the authentic reagents of the prosperity and that justify the monetary investment. How the Companies Exploit the Intellectual Capital Case Study Kingston Communications(Hull) Plc is group of companies based in Hull,United Kingdom. The groups is presently offering the services related to information, communication technology and the telecommunications to the consumer markets in UK. The groups Brands include Affiniti,Smart 421,Jam IP(Integration and management services),Karoo, Eclipse, Mistral (Internet and Telecommunication services) and Hull Color pages and Know( Information Services). The group is Ammortising the its Intangible Assets that aquired in the Acquisitions.In 2007,the ammortisation on intangibles was à ¢Ã¢â‚¬Å¡Ã‚ ¤8 million(from Total depreciation and ammortisation).The group also has purchased the tangible and the Intangible assets worth à ¢Ã¢â‚¬Å¡Ã‚ ¤30.2 million.The Groups Controlled measures include, measuring the learning and development(p9),Customer Satisfaction. KM also believes that Human Resources when managed through and effective Policy can bring the Tangible effect on the companys performance. KM is running a development program to enhance the Knowledge and Intelligence of the employees.The company also manages the Relational (Custmer) Capital by arranging the meetings of the Directors on the Investor relations and the shareholders concerns specifically. The Company’s publishes its Financial Reports complying with the IFRS,however, the company also provides additional disclosures if compliance with the IFRS does not fullfil the requirements of the users(i.e External Stakeholders,External investors,Suppliers and the Customers) to understand the impact of certain transactions that have an effect on the financial performance of the company. Relational Capital Management and Policies Arranaging meetings with the shareholders time to time to discuss the company’s strategies and performance.Maintaining a investors relations function to encourage and improve the communication with the investors. The Goodwill of the Company in 2007 was worth à ¢Ã¢â‚¬Å¡Ã‚ ¤192.754 million(2006:à ¢Ã¢â‚¬Å¡Ã‚ ¤155.551 million) and the Intangible Assets had the value of à ¢Ã¢â‚¬Å¡Ã‚ ¤48.511 million (2006 : à ¢Ã¢â‚¬Å¡Ã‚ ¤39.450) according to the Balance Sheet on 31st march,2007. The Cash Flow Statement of the Company for the year ended 31st march,2007 also explicitly show the Amounts of the Ammortisation of Intangibles as compared to the tangible fixed assets.The Cash Flow statement also show the companys procurement of the Intangible assets à ¢Ã¢â‚¬Å¡Ã‚ ¤6.495 illion in 2007. The financial statements of the Company are prepared according to the principles prescribed by IFRS and IFRIC.These financial statements are based on the concept of historical Cost accounting.However, the statements are modified due to the revaluation of the financial assets to a fair value by using the income statement. Intangible Assets Identified by Kingston Communications The Intangible Assets of the Kingston Communication include: 1.) Goodwill 2.) Customer and Supplier Relationships 3.) Technology and Brands 4.) Software 5.) Development Goodwill The Groups Goodwill is reported in the acquisitions of the subsidiaries and it is the difference between the Cost of Acquisition and the Net Assets. The Goodwill is tested for impairment annually. Development The company’s intangibe asset that is developed through the research and development activities only when it fulfils the criteria of Intangible Asset Recognition prescribed by IAS 38 i.e the asset is identifiable,impact on future cash flows and the developmental costs of the assets are measured reliably.The estimated life of the internally developed intangible asset is 1 year and is also ammortised on a straight line basis. Valuation of the Intangible Assets in Kingston Commnuications The intangible assets that are acquired through the acquisitions are valued on the basis of their time value and the future impact of on the performance of the companies. Appraisal of Intellectual Capital in Kingston Communications The Kingston Communication is exploiting,managing and reporting its Intellectual Capital as tool necessary for the competitive advantage and for improving the future performance of the company. According to the companies policy the Intangibles Assets are included in the Balance Sheets in order to satisfy its investors and guarantee the future investments in the company. However, there are no benchmarks for the management and the evaluation of the these Intangible assets.Also, the company is not using the models for the Classification of these Intangible assets as suggested by (Kingston Hull plc , 2008) Measuring the IC (Performance)through strategies(Management Accounting) Simons(1999) suggests that the by measuring the performance of a company is basically the comparison of the outcomes of the business activities with the critical business targets. The traditional financial accounting utilizes two techniques to measure the Performance .These are Return on Capital Employed(ROCE) and Return on Assets (ROA). However , these techniques are condemned due to the fact that they are old fashioned , unable measure the intangible assets and are unable to appraise the stakes in the technology which is essential for the firm to compete in the global market(Bourne et al , 2000; Amir Lev , 1996). Valuation Methodologies(Performance Measures as well) The economic measure of the Profit yields the same result as the traditional accounting during the matching phase of costs and revenues by preserving the value significance. This is done by improving the financial reports with the disclosure of the concealed assets like the intangible assets and the investments in the long run(Simons , 1990). (It includes the tools and various methodologies ) Watters et al(2006) have discussed the application of a Scorecard assessment tool in the Scottish SME that provides a review that how efficiently companies are exploiting their Intellectual assets.The tool helps the SMEs to manage three areas of operations i.e Sales and Marketing , Research and Development and Human Resources. It assign the scores to activities that come under the three operational areas according to their effectiveness and links them to the strategic objectives of the firms. (Appendix 1) Brand Finance plc(2000) suggests that there are a lot of methods present for the valuation of the Brands, however there is a need to find an optimal one. Cost based methods of brand valuations show a disparity from its market valuation. The Market Comparison method is not efficient as it is difficult to obtain the comparison data. Royalty Relief method determines the royalty rate on the estimates of the income generated from brands. However , this method does not clearly states that how a brand is going to create value. The Economic Use method combines the consumer and the competitor to entitle the value to the brand.The last method is the most optimal method which is the Brand Finance that uses the Discounted Cash Flow (DCF) analysis in concluding the value for a brand.As the Discounted Cash Flow method valuation complies with the valuations performed by the financial analysts , accountants to check for the impairment of the intangible assets. Measurement of Intellectual Capital Why there is a need for the companies to measure the intellectual capital This is a very long debate that why companies need to measure the intellectual capital.There are several advantages of doing that. The term intellectual capital can be said to be â€Å"expandable† in terms of the Value and rewards. The greater the effort of a company the greater is a competitive advantage and greater is sustainability of the company. Nowadays companies and the firms have become Knowledge aware i.e they have now recognized the importance of the of the knowledge that creates value and sustainability. The Companies working in the Telecommunication, Pharmaceutical and the research technology sector specifically have to invest a lot in the Research and Development to compete and develop the innovative solutions to avail the opportunities in the market.Therefore, there is a strong need for these companies to devote themselves to measure and manage their intellectual capital effectively. However, it is very difficult to justify the investments in digging out the knowledge that creates value .These investments are rather very complex and unpredictable even if they are tested and analysed by the efficient tools for their proficiency. Some Organisations that are knowledge based are sometimes not sure about the amount of the Knowledge they have and the amount of knowledge they need tocarry out their functions internally and externally. That is the reason, these organizations loose the interest of the investors and therefore the investment. Balanced Scorecard (An Alternative to Balance Sheets) Kaplan Norton(1992) , presented the theory of the Balanced Scorecard for improving and tracking down the performance of an organisation. The authors suggest four dimensions such as Financial , Customer , internal business process and learning and growth. These dimensions are believed to provide a insight in to the current performance and identify the factors that can improve the future performance. A combination of the non-financial and financial measures are insufficient in determining the performance of an organisation. The main problem is that its just like a Wild Goose Chase as this amalgam of the performance indicators are not pursuing a specific business objective. Kaplan Norton(1996) believe that the both the financial and the non- financial measures must have a focus on a goal that has to be achieved in maintaining the sustainability. The authors further argue that the various measures provided by the balanced scorecard can help the organisation to plan a particular strategy and then can implement it across its subsidiaries, departments to share a common motive with trasnparency. A well planned BSC can hep the organisation to learn from the short-term reports that are generated and scrutinized through various perspectives. Andriessen(2004) suggests that the predicament of measuring the Intellectual Capital can be resolved by applying the balanced scorecard. It has been advised that the specified strategy plans can be created that guide the organisations to confidently invest in the human resources, technology and the structural capital. It is further revealed that by measuring and administering the intellectual capital can also help the organisation to convert its non-monetary achievements in to monetary achievements(Kaplan Norton , 2004). A study conducted by Hagood Friedman(2002) devised a way for the implementation of the balanced scorecard to measure the accomplishments of the human resource information system of a company. They have developed a system that uses the balanced scorecard as its foundation to improve the human resource information system in association with highlighting the goals and objectives of the organisation. Despite of its usefulness the Balanced Scorecard has some limitations. In this context Voelpel et al (2006) has identified five limitations of the balanced scorecard in its application in the modern economy. First being its inflexibility that is, it measures the performance of a company only in four perspectives by leaving behind some other perspectives out of attention. Voelpel et al(2006 ) explain the second limitation which is that the BSC is less efficient in accommodating the changes in the changing economy. The BSC a defines a strategy for a company and its subsidiaries to achieve a goal by neglecting the individual goals of a subsidiary as a consequence a company is unable to use its potential properly. The third one is that BSC focuses more on improving the internal performance of an organisation therefore by losing a link with the external world to exploit the innovation.The forth limitation of a BSC is that it focuses on the organisation in itself and provides no information about the actions of competitors. The fifth problem with the balance scorecard is that it goes straight in measuring the performance in a rational way .As a consequence the more complex predicaments are difficult to apprehend(Voelpel et al , 2006). A Comparison between the benefits that arise from intangible and tangible assets There are risks involved with the investment in the intangible assets like RD. Kothari et al(1998) have conducted a research by comparing the uncertainty of benefits associated with the tangibles and the intangibles assets. The methodology used for this research was the regression analysis of the future earnings variability involved with the expenditure in Research and Development and the tangible assets .Furthermore , the variables like firm size and the leverage are also used to define the boundary of a research.It has been illustrated by Kothari et al (1998) that the future benefits of RD investment are more uncertain than the tangible assets. Shi(2003) has analysed and studied the relationship of bond prices and the measures of RD expenditures and suggest that there is a fair risk involved with the spending of the RD projects that increases risk factor with the bondholders claims and hence are more riskier than the other projects. Issues in Intellectual Capital(Flaws in the IC Concepts) Bontis (2001) discovered a predicament with the intangibles assets is that there is no unique conception that is accepted by everyone. Every investigator or a consultant who contributes to the debate expects the approval and recommends his own jargon. Various other researchers have pointed out flaws in the definitions of the Intellectual Capital. According to Edvinsson and Malone(1997) the intellectual capital was the difference of Market value and the Book value. In contrast Upton(2001) recommends that the intellectual capital cannot be absolutely characterized by simply calculating the difference of market and book value. Following that Habersam and Piber(2003) advocate that the term intellectual capital cannot be determined by the difference of market value and the book value. Pragmatically, the difference can be influenced by some other elements that are not associated with the intangibles.Further research enumerates five components that can realize a change in the the stock prices which incorporates the recognised assets , company liabilities , legal events , shareholders equity and the timing issues(Garcia-Ayuso 2003). The benefits received by a firm cannot be attributed to the individual intangible Assets as such benefits are a result from the inter-cooperation of more than one Intangible asset. Therefore, it could be wise to value the intangible assets all together. It is further argued that the market value of a firm cannot be ascribed to the intangible asset

Shakespeare In Love :: essays research papers

Shakespeare in Love is a fictional story about the writing of William Shakespeare's Romeo and Juliet. Shakespeare, played by Joseph Fiennes, is in the middle of what could be a disastrous writer's block. His idea for the play, which should be completed, is a pirate comedy entitled Romeo and Ethel, the Pirate's Daughter. But Will is stuck, his shrink asks him how long it has been since he has been with a woman and advises him that that is what he needs. Auditions are held since the players' troup is out on tour. All the not so actors are pitiful. Except for Thomas Kent, the alias given by Viola, played by Gwyneth Paltrow. Women at this time are not allowed on stage in public. After Shakespeare shows interest, this character runs away to her estate where a party is being held. He follows Thomas into this party to later find love at first sight in Viola. Thomas once again shows up to receive her part in the play as Romeo. While Will and Thomas are talking, Shakespeare pours his heart out, telling about this wonderfully beautiful woman, Thomas's cousin. Somehow, they end up kissing. Now that Will has this woman, his writers block is cured, he goes on to write Romeo and Juliet through his true-life actions in his affair with Viola. At the end of the movie they put on the play through all the hardships, in the company of Queen Elizabeth. I greatly enjoyed this movie, even though it is not a typical movie of my preference. The truth is that I would have never gone to see this movie if extra credit was not given. I was delighted to see an extremely entertaining movie. I was also amazed at all the references that I would not have not caught if it weren't for English Literature and history covered this year and by reading Romeo and Juliet two years ago. Freshmen year, while reading the play, I repeatedly caught myself thinking, "I don't understand a thing they are saying.

Research Proposal for Internal Auditor Essay

Introduction The responsibility of the internal audit is to serve the Ministry of Justice in a manner that is consistent with the Financial Administration and Audit Act, Standards for the Professional Practise of Internal Auditing and with professional standards of conduct. This activity has the potential to provide hitherto unparallel services to management in the conduct of their duties. Background of Study The government of Jamaica established the Internal Auditing Agency as a means of strengthening accountability and reinforcing trust and confidence in financial reporting for public sector institutions. These audits help enhance economic prosperity, expanding the variety, number and value of transactions by means of written reports or consultations to prepare persons who are entering into transactions. (Institute of Chartered Accountants 2005) The value of an Internal Auditor lies in how well he/she is able to contribute to the overall achievement of the organisations objectives. The auditor should always strive to make himself relevantto the ogranisations using the proper methods of providing information to that will allow management make decisions that will impact the organization positively on their ability to achieve organisational goals. However according to the reports made by the Auditor General of Jamaica (2005) audits have been restrictive in terms of scope with the lack of technology in aiding auditor and fraud. This needs to be addressed if the required return on investment in the Internal Audit is to be attained. Problem Statement The Internal Audit Agency (2006) believes that the importance of internal audit is analytically obscure. This belief plagues the importance of an internal audit as a key function that can strengthen the oversight responsibility of the governing body and this attitude reflects management’s view on auditors. To sum it up, Public Sector agencies discredit auditors, The Internal Audit functions in the Jamaican public sector faces a perception and credibility problem as auditors are seen as value adders or fault finders in the government rather than solution providers. Management Question: Why is it that public sector managers find the function of the Internal Audit Agency an inconvenience and what can be done to curb it? Research Questions: 1. Why is there a low support for Internal Audit by Public Sector Managers? 2. What steps should be put in place in order to get the support of management for Internal Auditing in the Public Sector? 3. Is there a comparison between the quality of service the Internal Auditor provides for his organisation and the attitude of managers towards the Internal Audit function? Hypothesis: The quality of service provided by the Internal Auditors for their organization is in no way related to the attitude of managers towards the function of the Internal Audit. Objectives: 1. Examine the factors that are responsible for the low support of the Internal Audit by managers of the Public Sector institution. 2. Identify specific actions required to secure support of managers for the Internal Audit 3. Establish the relationship between quality of service and support of managers for Internal Audit Significance of Study: The significance of the study will be to: 1. Introduce the Agency to the Jamaican public not as evaluators but future planners 2. Improve the public understanding of the Agency’s role in the government 3. To show that the agency aids organizations in achieving their goals and objectives. Methodology Areas covered in this section include : research design, population, sample and sampling techniques, data collection and analysis. Research Design: Â  The design will involve evaluating the role of the Internal Auditors in the governance of the organisations in the public sector. This research is designed to validate the objectives set out by the researcher. Population: The public sector of Jamaica is probably the largest employers of internal auditors. These institutions involve several organisations including ministries, departments and agencies (A). It also includes metropolitan, municipal and district assemblies (B). The targeted population for the study would include: 1. Directors and managers 2. Financial officers, coordinating directors and staff 3. Staff and heads of the audit departments Sampling and Sampling Technique The researcher will adopt the survey type of research in which a sample from the target population will be used for the study. A total of 150 elements will be selected from a target population of 500. The details are as follows: * 20 directors and 5 managers * 30 coordinating directors and 15 financial officers * 60 staff members and 10 heads of the audit department In this research, the researcher will adopt a multistage stratified sampling method to select elements. -The population will be separated accordingly into (A) and (B), as shown above. -Elements in group (A) are the Ministries, Departments and Agencies -Elements in group (B) are the Metropolitan, Municipal and Districts. This separates them to allow the research information to be more coherent and shows that their operations are significantly different. Data Collection: The focus of this data collection is to show the attitudes and perception and the importance of primary data. Secondary data will also be collected to reinforce the data collected. The researcher will have to provide the Public sector institutions with an introductory letter explaining the reason for the research with proper identification and request consent. The initial visit to selected institutions would be to familiarize himself with those institutions and members within the institutions . Data Collection Instrument A questionnaire will be the instrument used in retrieving the Data. It would include structured questions segregated into 4 sections. ‘Section 1’, ‘Section 2’, ‘Section 3’, ‘Section 4’. * Section ‘1’ will consist of questions seeking to answer the first research question * Section ‘2’ will consist of questions seeking to answer the second research question * Section ‘3’ will consist of questions seeking to answer the third question * Section ‘4’ will consist of questions to test and validating the hypothesis Data Analysis The answered retrieved from the questionnaire will be graded in each section and a percentage will be formulated. Limitations The researcher may not be able to cover all the institutions over Jamaica. Institutions may not allow the researcher to conduct research on the organization. References * The Institute of Internal Auditors (the IIA). (2007), The Professional Practices Framework. Florida, U.S.: The IIA Research Foundation. * Institute of Internal Auditors (2010) Role of Internal Audit, South Africa * Cahmbers, R. Internal Auditor: Chambers on the Profession (2012) Dilemmas Every Internal Auditor Will Face, http://www.theiia.org/blogs/chambers/index.cfm/post/Five%20Dilemmas%20Every%20Internal%20Auditor%20Will%20Face * Ministry of Justice, http://www.moj.gov.jm/internal_audit * Auditor General’s Department of Jamaica, Annual Report 200, http://www.auditorgeneral.gov.jm/ Table of Contents Introduction 2 Background of Study 3 Problem Statements 4 Management question, Research Question and Hypothesis 4 Objectives and Significance of study 5 Methodology 6 Research Design and Population 6 Sampling and Sampling Technique 7 Data collection, Data Instrument, Data analysis and Limitations 8 References 9

My View of the World Essay

As I stand here looking over the lush green foliage of thousands of trees, I glanced down toward the base of the mountain to see curvy, windy roads, weaving in and out between tiny little box houses, plotted around here and there. I can see for miles and miles, the views are breath taking. That’s mostly why people come to see me, to look out with me, to see the fantastic views. My arms are sore from standing here for about 75 years, just doing nothing but wondering. For many months I have started to think what is beyond the horizon of the sea. There could be a whole new world over the edge. Is there even an edge? Who knows? Years ago those little things climbed on my feet, just to get a better view or to pose in front of a compact box, with a blinding flash for a couple of seconds, but now there are large metallic fences at my feet. This is predominantly because I am old, weary and wearing out so I need protecting. People get here in many different ways, clear boxes which travel up and down continuously, moving stairs, or climbing 222 steps reaching the summit, exhausted. Oh yeah! I forgot to say about the odd people that walk all the way up the ridge of mount Corcovado who wear small shorts, long pulled up socks, big chunky boots, weird hats and really, really big bags on their backs. They come in there hordes, they come in all shapes and sizes; big ones; small ones; fat ones; thin ones; some are noisy; some are quiet; some just scream and laugh; some are in awe of me and gaze up at me, as I gaze out at the horizon. These people see me as a god, but if only it were true because all I want to do is just fly to the moon, to the white wonderful wide space, where I could rest my sore painful arms and legs. No one knows the pain I’m in or even know I have any feelings. I remember the journey of how I came to be here. I was created by a local engineer called Heitor da Silva Costa. He made me out of reinforced concrete and layers of soap stone. Firstly I was going to be made out of steel but that wouldn’t of had much of a chance against extreme weather conditions. I was built in small chunks and slowly brought to the top by a struggling train on the Corcovado Rack Railway. Then I was pieced together bit by bit, slowly rising above the ridge to embrace the people of the world. Through my amazingly large nostrils I can smell the wondrous cuisine from the land below swirling and rising up the mountain side. Just after dark the surroundings black out and all attention is drawn towards the bright lights of the city. Although no one else sees it, it’s not all happiness up here. I have seen many things in my life like robbery’s, suicides, murders, but what always happens almost every night is groups of people sell drugs and sit there injecting liquids into their arms, snorting dust and sniffing corrosive fumes of acids. The fumes are so strong even I get a headache and my heads made out of concrete! It is disgusting what they do, but it is what they want to do, and what could I do any way. As dawn emerges it makes up for the previous night. The sun rises and a new day begins. In the early morning, the mountain air is fresh and crisp; the sun rises leisurely, bringing a slow warmth to the city. The most beautiful part of the day is now, when it is peaceful and you can hear the chirping of the birds below. The heat from the sun breaks through my layers of soap stone reaching into the hard cold concrete inside.

Qantas Airlines Performance Analysis Essays - Finance, Economy

Qantas Airlines Performance Analysis Essays - Finance, Economy Qantas Airlines Performance Analysis Name: ID: Module: Instructor: Number of Words: Date of Submission: Executive Summary Having residual claim to the net assets of a company in liquidation, equity holders, both potential and existing, have a substantial stake in the financial performance of a company. But the fiercely competitive business landscape, with higher mobility of finance and knowhow, has made the decision making task before investment difficult. The global financial crisis (GFC) in the last decade is a clear message to all concerned that short term financial performance cannot give true picture of long term potential of a firm. Getting a true view of a firm's long term health necessitates an overall analysis of the firm's operations and performance which includes investigations as to how the firm values interest of other stakeholders and how far it has been able to meet their expectations. Hence the potential and existing stock holders need to evaluate the attractiveness of a firm as investment destination on the basis of the firm's long term financial and non-financial performance as regards all the stakeholders' interest. TABLE OF CONTENTS Introduction4 Stakeholders Value Analysis4 Share Price History12 Share Price Return13 Return and Volatility of Qantas Stock Price15 Current Valuation of the Equity of Qantas 17 Evaluation of the company's Investment Projects 19 Dividend Policy and Capital Structure of Qantas 19 Overall cost of capital20 Concluding Remarks 21 References 23 Introduction A business is a conglomeration of activities performed by persons, group of persons, and institutions. The performance of the business affects the interest of all the stakeholders, namely the stock holders, the employees, the suppliers, the government agencies, and the community at large. Evaluation and decision as regards attractiveness of a company for investments can be made by existing and potential stockholders, bankers, and suppliers of raw materials and utilities on the basis of analysis of financial figures disclosed by the company in its annual reports. A more comprehensive report card of the firm can be done through stakeholders' analysis directed to the assessment of overall corporate health of the firm. This instant report is a case study consisting of a systematic and structured analysis and assessment of the long-term attractiveness of Qantas Airlines, an Australian airline industry listed in Australian Stock Exchange (ASX), as an investment destination. Qantas 2018 Stakeholders Value Analysis Stakeholders' value is a management philosophy and maximization of it tends to get momentum in acceptance as a valid objective of business among business management fraternity. Short term financial success may not sustain in the long run, and other non-financial parameters are needed to be measured to derive a more inclusive picture depicting overall health of the company. Stakeholders, by their actions, deeply influence operations and performance of a firm, and also have certain expectations from the firm. Analysis of the extent to which such expectations are met is known as stakeholders' value analysis, and the final assessment is called Balanced Scorecard of performance of the firm which shows its current profitability and long term sustainability in the competitive landscape. Qantas Airlines is the Australia's biggest domestic and international airlines with a strong brand value, and one of the leading airlines company in the global aviation sector. In this section Stakeholders A nalysis and balanced scorecard of Qantas Airlines are done. The widely accepted benchmarks for aviation company performance are used in the analysis and the metrics are calculated on the basis of financial figures and non-financial information given in the company websites, annual reports, and professional websites. Analyzing period for this section is 2013 -14 to 2017 - 18. Table 1: Economic Integrity Benchmark Metric 2017/18 2016/17 2015/16 2014/15 2013/14 Underlying PBT $M 1,604 1,401 1,532 975 -646 Statutory PBT $M 1.391 1,181 1,424 789 -3.976 ROIC % 22 20.1 22.7 16.2 -1.5 Underlying EPS Cents per share 64 55 53 32 -21 Statutory EPS Cents per share 56 46 49 25 -129 Net FCF $M 1,442 1,309 1,674 1,104 0 Analysis: Underlying PBT: This is a non-statutory measure, showing the profit earned in the normal course of business, with normal parameters. No one off profit or loss is included. The trend shows the metric is increasing steadily. Statutory PBT: This is derived by adjusting any one off profit or loss with the underlying PBT. It has markedly improved since 2013/14. Underlying EPS: It is calculated from underlying PBT. After deducting tax from underlying PBT the amount is divided by weighted average number of shares outstanding. The trend shows steady increase. Statutory EPS: It is calculated from statutory PBT. The trend shows steady increase. Net free cash flow (CFC): It is the operating cash available after deducting cash spent

Modernization of America essays

Modernization of America essays The Transcontinental Railroad was completed in 1869. The telephone was invented in 1876. The first practical system for a radio was developed in 1895. The Wright brothers created a flying machine in 1903. The first gas powered automobile, the assembly line and the refrigerator were produced in the early 20th century. These are all very important steps in laying the foundation for the modernization of America, but I would argue that the first truly modern period in American history would have to be the 1920s. The 1920s brought a capitalistic population who, as a nation, leaned toward isolationism. In two main fields, the 1920s modernized American society to reflect the America of the 21st century more than any era before it. These fields are media and business. Along with a new decade came a new attitude from the media. By 1922 there were 22 magazines in circulation and by the end of the 1920s, 40% of Americans owned a radio. The first tabloid magazine appeared in 1919. The media that we know today spawned from this growth in the 20s. This new type of mass media permitted the spreading of national trends or obsessions, such as flagpole sitting. A 21st century equivalent to this type of rather bizarre behavior of national trends could be the Christmas Tickle me Elmo or Furby craze over the last few years. The national connection that the mass media provided also allowed for fashion to become important and for heroes in the world of sports to emerge. Advertising became a lucrative business and targeted middle class homes. The decade brought a new openness about sex, and the media did not miss the chance to take part in this revolution. The movies were very popular and the film stars who were known for being cute and innocent, such as Americas Sweetheart, Mary Pickford were replaced by stars who were sexy, like ...

Capabilities and Resources of Westfield

Capabilities of Westfield include their global operation. This is due to the reason that according to the reports, Westfield is having their operations in Australia, New Zealand, Italy, Croatia and the United States. Thus, they are already having the experience of entering and operating in new countries. It will be beneficial for them to use these experiences in entering in other foreign markets. Moreover, they are listed under the Australian stock exchange and are publicly traded company. Thus, they are having huge access to the financial resources. Their capabilities also include diverse product areas. According to the reports, Westfield is mainly having their business growth in the fashion and leisure sector. Thus, these sectors will also help them in having their market growth in the proposed host country. One of the major strengths for Westfield is the positive brand image and established market in Australia. This will help them to take more risks in the host country. The positive brand image of them will help in pushing their brand in the new markets. Another strength of them is having diverse business presence. Thus, it will help them to cater to different business sectors in the target market. This will also reduce their risk in entering in the new markets. Westfield is already having their presence in different countries and thus it will be easier for them to target the new market more effectively. Entering in the emerging countries will have more business potentiality for Westfield due to the reason that in the current time, developing economies are witnessing more growth compared to the developed countries. Another probable opportunity for Westfield will be lower cost of operation in the developing countries. This is due to the reason that Westfield will find cheaper resources for their business operation in the developing countries. Thus, the profitability of them will get increased. China is a highly populated nation in the world. The huge lucrative market of China is great for business opportunity. With the GDP rate of 6.8% in 2017, it is expected to be the fastest growing economies in the coming years (Festing & Schà ¤fer, 2014). China is always perceived as market growth to provide cheap labor and facilitates in low manufacturing costs.   Westfield Group has to bring something unique in the Chinese market otherwise the company will land itself in a passive position. While entering the market with new resources and productivity would lead to provide a major threat to the existing companies (Andersà ©n, Jansson & Ljungkvist, 2016). The regulatory bodies of China mostly operate in an opaque way that makes the country too difficult to forecast the regulatory changes. Joint venture is beneficial as the low risk market strategy. The GDP rate of China has been growing recently since the past few years and the growth rate is at 6.8%. (Kozlenkova, Samaha & Palmatier, 2014). The existing population of the region also provides a great opportunity for the multinational companies to establish business. This facilitates in providing abundant of human resources to the firm. Westfield Group can enter the Chinese market and expand its business as the China has a favorable business market environment. Cross border economic activities has also increased to a great extent. The literacy rate in China has also increased and majority of the people within the country is literate. Joint Venture will be more beneficial to do business in China (Nyberg et al., 2014). It is the most effective way to enter in the emerging market. The cultural differences between the two countries should be ascertained to maximize profit in the overseas target market. Though the common business language is English still there can be language issue in the market of China. Moreover, legislation policy also varies worldwide, hence Westfield need to investigate the legal policies and adhered to the local laws. Andersà ©n, J., Jansson, C., &Ljungkvist, T. (2016). Resource Immobility and Sustained Performance: A Systematic Assessment of How Immobility Has Been Considered in Empirical Resource?based Studies.  International Journal of   Management Reviews,  18(4), 371-396. Brandon?Jones, E., Squire, B., Autry, C. W., & Petersen, K. J. (2014). A contingent resource?based perspective of supply chain resilience and robustness.  Journal of Supply Chain Management ,  50(3), 55-73. Festing, M., &Schà ¤fer, L. (2014). Generational challenges to talent management : A framework for talent retention based on the psychological-contract perspective.  Journal of World Business,  49(2), 262-271. Kozlenkova, I. V., Samaha, S. A., &Palmatier, R. W. (2014). Resource-based theory in marketing.  Journal of the Academy of Marketing Science,  42(1), 1-21. Lin, Y., & Wu, L. Y. (2014). Exploring the role of dynamic capabilities in firm performance under the resource-based view framework.  Journal of business research,  67(3), 407-413. Nyberg, A. J., Moliterno, T. P., Hale Jr, D., &Lepak, D. P. (2014). Resource-based perspectives on unit-level human capital: A review and integration.  Journal of Management,  40(1), 316-346. www.theaustralian.com.au. (2018).  Theaustralian.com.au. Retrieved 12 April 2018, from https://www.theaustralian.com.au/business/property/westfield-corporation-to-navigate-retail-storm/news-story/498245965eb0a4e94f61b855d718c8bb

Who was Adam Smith Essay Example | Topics and Well Written Essays - 1000 words

Who was Adam Smith - Essay Example This historic distinction later became an anthropological and historical interest for those who would visit Edinburgh (Smith (b), n. d.). Smith was born in Scotland and got education in Glasgow. He also spent his academic life in Oxford and gained extensive knowledge on literature there. He became the tutor of the Duke of Buccleuc in 1752 and travelled with him a lot around France and Switzerland. This experience gave Smith an opportunity to get acquainted with Voltaire, Jean-Jacques Rousseau,  Francois Quesnay, and Anne-Robert-Jacques Turgot--his contemporaries (Smith (a), n. d.).   He spent his earning paid by the Duke to write The Wealth of Nations, which was published in 1776, the year when the American Declaration of Independence was inked (Smith (a), n. d.).   In 1778, he was appointed as the Commissioner to the Custom and this experience sharpened his understanding on trading. He fought against smuggling with much enthusiasm, according to historical accounts. He had rema ined single during his entire life and died in Edinburgh on July 19, 1790 (Smith (a), n. d.). ... d.). He published the book on the Wealth of Nations to reveal the nature and cause of a nation’s prosperity from the increasing division of labour to systematize its production (Smith (a), n. d.). He professed that individual would invest resource e.g. land and labour, to earn the highest possible return of investment but such must yield to the equal rate of return (Smith (b), n. d.). For other economist, this was the core of Smith’s proposition of economic theory. Smith advocated equality of returns to explain the differences of salaries based on the knowledge, skills, expertise and skills of workers (Smith (a), n. d.). Those difficult jobs to do would be bit higher in compensation – and this explicated the notion of human capital. Hence, the differences of the nature of work are compensated differently (Smith (a), n. d.). The Wealth of Nations likewise discussed the high cost of British imperialism and substantially—about the relation of supply and deman d (Smith (a), n. d.). He observed that economic inequities are caused by monopoly that burdened consumers of the whole expense of maintaining and defending that empire (Smith (a), n. d.). Smith opposed  mercantilism because it artificially maintained a trade surplus on the erroneous belief that doing so increases wealth (Smith (a), n. d.). Although trade opened up new markets for surplus goods offer access to commodities from abroad at a lower cost but comparative advantage of the products from the outside will weaken the price of the goods from within ((Smith (a), n. d.). Akin to most modern believers in free markets, Smith believed that the government should enforce contracts, grant patents and copyrights to motivate

Poverty and Child Abuse Term Paper Example | Topics and Well Written Essays - 1750 words

Poverty and Child Abuse - Term Paper Example The poverty problem is a dilemma which gives rise to child sexual abuse since the families are not concerned about child protection. The way children are maltreated, misuse, and neglect have many times escorted them to the vulnerability of child abuse. However in the United States, child abuse is not a new issue, since children have been the subject of various types of abuse for decades, therefore concern for abused children now demands action from private citizens as well as the government. Despite the existence and active participation of child welfare programs, child abuse is a common problem confronted by the United States. One reason for the widespread of this quandary is the fact that economic resources and political structure varies according to the social determinants for people who live in urban and rural regions (Kenney et al, 2001, p. xv). Child abuse some decades ago was seen as a problem of physical battering and the deliberate intention to harm the child, mainly by parents. It was in the 1970s that the meaning of the term child abuse expanded to include not only physical harm of the child, but also sexual or emotional maltreatment by parents or caretakers since abuse does not have to be deliberate infliction, but can also take the form of omission to act resulting in neglect of the child's needs. The main concern pertains to what our communities consider as child abuse, for example in many community cases in the professional consensus in the United States it was a concern as to what constitutes abuse or neglect of a child. When analyzed on the basis of community research it was found that all agreed to consider a child with fractured bones from repeated beatings as 'abused', while a child who is not given the minimum amount of food, clothing, or attention necessary for survival or a young child left unfed in a room as neglected. There were various class perspectives on maltreatment which exist between the extreme cases of child abuse and neglect, however there is a wide range of situations on which there is often disagreement about what constitutes emotional or physical abuse. These vary according to class as poor class more moderately defines what is entailed in sexual or physical abuse. Child abuse possesses three main types and has been so deeply embedded in our society that most of us are not even aware of how it disrupts our social determinants of living standards. Traditional child rearing practices and inappropriate child maltreatment with lack of monetary, organizational and informational resources addresses the problem with greater cause. Verbal Child abuse Based on cruelty or unjustified punishment, verbal abuse entails direct enforcement of exposure to punishment or permitting of a child to suffer resulting in an unjustifiable physical pain or mental suffering. Often called as emotional or psychological child abuse is the most common found in almost every class. Families usually neglect such mental or emotional suffering of their children and do not intend to report or view it as a serious issue, verbal abuse is not considered to be reported, but may be reported. Many families consider it

Will Evolving Forms of Journalism Be an Improvement Essay

Will Evolving Forms of Journalism Be an Improvement - Essay Example The growth of the Internet has had far reaching effects on almost all industries. In journalism, the internet has expanded the opportunities for individuals to generate content and disseminate it to potentially millions of users at a low cost. Participatory journalism takes two forms; civic journalism and independent journalism. The former is most suited to improve the field of journalism. In civic journalism, media outlets give their audience an avenue to comment and report on public matters concerning them. Social media provide a gathering place for a broad range of people to participate in a discourse on everyday issues. During the Arab Spring, Social media played a large role in informing the public and gathering support for civil disobedience efforts. While traditional media remained gagged by Arab governments, social media sites of both regional and international media were alive with thousands of user-generated reports. Even when Arab governments shut down internet access, citizens worked to provide alternative internet access. Alex Jones claims that the collapse or diminishing popularity of traditional news media has the potential to impact negatively on democracy (Alexander and Hanson 169). His argument is valid to some extent as the verification of news that traditional media offers ensure that the information provided to the public is free and fair to all parties and devoid of irregularities. However, throwing a blanket condemnation on participatory journalism ignores evidence that do not support Jones’s argument. Jones mistakenly believes that quality journalism is entirely responsible for democracy. In 19th Century America, while most newspapers openly favored particular parties, voter turnout was considerably higher than modern day America where journalism could be considered to be of a higher quality than in the past. The impact of social media on audience levels are seen in two approaches. The first approach is that through