The Strategic Route of Lexus Term Paper Example | Topics and Well Written Essays - 2500 words

The Strategic Route of Lexus - Term Paper Example There have been huge sales of Lexus brand in different categories like hybrid, midsize premium and others. There are several models of Lexus. The focus is on Lexus GS model that is available in two variants: GS 300 and GS 460. These two are the premium products and have the capability to attract the consumers (Lexus, 2010). There is huge potential in the global market of the brand Lexus and the opportunity can be captured properly with an appropriate marketing strategy. The company needs to identify the primary and selected market for attaining more sales of Lexus. The brand Lexus GS model will be discussed in this paper regarding its potential in the United Arab Emirates (UAE) market. This research paper looks to determine the potential market of Lexus GS in the UAE market for the upcoming years (2011-2013). There are certain factors that have already been discussed and now it centers on the marketing strategy for Lexus GS. Marketing strategy is the key factor for the business success. There are two approaches i.e. primary and selective marketing strategies for the Lexus brand in the UAE market. The basic discussion of the paper is related to the type of demand that will be stimulated for the next three years. Both primary demand and selective demand will be focused upon the UAE market and one will be selected as a marketing strategy for Lexus. The UAE’s real growth for 2011 is expected to be 6.7%, 7% in 2012 and 6.7% in 2013. The per capita expected in 2011 is $43,030, $47330 in 2012 and $52160 in 2013. There is huge potential for Toyota Lexus market with increase in real growth and per capita income (Government of Ras Al Khaimah, 2009). According to Dubai Roads and Transport Authority (RTA), there were more than 1021880 registrations of new vehicles in the UAE market. The potential of the UAE market is estimated to be approximately 1542000.  

Organisation and management coursework Essay Example | Topics and Well Written Essays - 3000 words

Organisation and management coursework - Essay Example The section of organization in which individuals are responsible for decision making pertaining to the business company is commonly called management. Management section is headed by manager or managers depending upon the structure of the organization. They conduct decision making practices according to the organizational objectives and goals. Richard L. Daft and Patricia Lane, (2009), state that the attainment of organizational goals by planning, managing and utilizing the available organizational resources is called management. Realizing the significance of management, manager selection should be done with great care. This is because it is ultimately managers who integrate organizational staff in a friendly manner, motivate them and push them to serve the company in the best way. Mangers need some tools in order to conduct management. Bargaining theory is one of the important instruments that help managers make successful decisions. Bargaining theory facilitates managers to settle down the differences between various business parties with the help of bargaining tool. In order to utilize bargaining theory in a best possible way, mangers need to be innovative. With the power of innovation, managers are in sound position to bargain efficiently. Bargaining theory is an offshoot of game theory, which is a very central mathematical and economic theory in itself. In this part of the question we will discuss the theory of bargaining in detail along with its historical background. The theory of bargaining is derived from the concept of bargaining. Bargaining is a type of negotiation for price settlement between varying business parties. It is a situation in which business parties agree on the matter of cooperation but face a conflict on how to corporate. Bargaining is a desirable business tool because it provides a solution accepted by all business players i.e. employers and

House prices in uk

House prices in uk Introduction According to a new study from Halifax one of the largest mortgage lenders. House prices in UK have beaten inflation over the past 50 years. It says that have risen 273% between 1959 and 2009 an average of 2.7% annually. But if measured by current prices, its uneven. The fastest growth was from 1999 to 2009 by 5% and in previous decade i.e. from 1989 and 1999, price fall by 24%. The rising price was on these years i.e. 1971-73, 1977-80, 1985-89 and the highest price was in 1998 and 2007. The study also noted that coincided with a very strong increase in owner occupation of homes. In 1961, only 43% of households owned the homes in which they lived by 2008 that had risen to 68%. The strongest rise in owner occupation rates occurred in the 1980s. The proportion that is privately rented also fell sharply over the past 50 years from 33% in 1961 to 14% in 2008. www.ft.com cited on 21/02/10. Demand And Supply Of Housing The comparison of prices in local and regional housing markets is an example of microeconomics. Lets see the interaction between buyer and seller with prices being offered and agreed before a final transaction is made. The transaction for house in UK depends upon a) The price that the seller is willing to agree for their property with prospective buyer. b) The actual price that the buyer is willing and able to pay. Buyers place offers for a property that the seller can either accept or reject. A Sellers Market When there is demand in a market for housing and short of good quality property i.e. means the supply is scarce. A Buyers Market When demand for good quality and bad quality property is weak than there should some offer or can negotiate the price than its published price. When the demand for houses in a particular area increases (perhaps because of an inflow of population into the area, or a rise in incomes following a fall in unemployment), there is upward pressure on market prices. Often the supply of available housing in the market is relatively inelastic. This is because there are time lags between a change in price and an increase in the supply of new properties becoming available, or other homeowners deciding to put their properties onto the market. When demand shifts outwards and supply is inelastic the result is a large rise in market price and a relatively small expansion of the quantity of houses traded. As supply becomes more elastic over time, assuming the conditions of demand remain unchanged, we expect to see downward pressure on prices and a further increase in the equilibrium quantity of houses bought and sold. Factors affecting housing price 1. Growth of real incomes Privately owned housing is a normal good for most people. As standard of living rise, the demand for house expands. 2. Consumer confidence Consumer has a vital role in the housing sector. When the economy is sustaining growth and rising property than its but natural that the number of house buyers and shifts the balance of power in the market. 3. Jobs The other factor is job. if it involves making a long-term commitment through a mortgage lender, changes in unemployment. If theres unemployment and average incomes are likely to be lower than confidence among buyers would affect. 4. Housing taxes and subsidies. Government policies, taxes and subsidies also affect the housing prices. Demand factors affecting house price FUTURE EXPECTATIONS 1. 2012 London Olympics May Help UK Economy Britains recovery can be done because of the infrastructure projects for 2012 London Olympics. Total spending is estimated for 2012  £9.3 (US$13.8) billion. There will be two major beneficiaries of the 2012 games: Londons crumbling mass transport system; East London, where the Olympic Stadium, the Olympic Village and other major facilities will be located. To accommodate the number of people in a city, the improvement is going on for transport of London upgrading to the London over ground. The Olympic delivery authority has given  £3.1bn for the construction of the Olympic park. The budget for this is  £1 billion for the Olympic village, and  £400 million for the media centre. This will benefit to the housing sector in UK. The more people going to accommodate in this country the space to live .That would benefit the housing sector of UK. http://www.financemarkets.co.uk/ cited on 15/02/10 2. UK Mortgage Supply Crash A loan to finance the purchase of real estates, usually with specified payment and interest rates. The borrower (mortgagor) gives the lender (mortgagee) a lien on the property as collateral for the loan. www.investorwords.com The data collected by British Bankers of Association is that the no of mortgages approved for purchase of house was 17,773 against 64,014 in July, 2007 a fall of 72%. The mortgage market clearly remains as extreme preventive measures are taken due to the collapse of Britains mortgage banks. The supply has fallen so the average value of loan offered for house purchases which peaked at  £159,600 in June 2007, and now averages at just  £116,700. Home owners imagining that equity of 25% despite the fall in house prices to date may in fact on attempting to remortgage find that remortgage purposes and hence not offered any loan at favorable interest rates. The interest rate cut from 5% straight to 2% in 2 months and  £600billion bank bailout package. The net effect to this area was total amount of mortgage loans were outstanding the amount was  £35billion, against to a stable market. And in 2009 the house price rose by 2.9% says government. But the data of nationwide and Halifax says that UK house price rose by 6%nearly. The fastest growth was in 2009 went up by 4.9%. http://www.independent.co.uk/ cited on 16/02/10 Repossessions Extreme Government Pressure In an attempt to limit the number of repossessions during 2009, the government is putting extreme pressure on the mortgage banks to ensure repossessions are a last resort. Up until September 2008 this amounted mostly to hot air from the politicians, however after having taken major stakes in most of Britains biggest banks there are strong signs that the banks are starting to comply with their new majority shareholders wishes (the government), that look set to increasingly introduce initiatives to reduce the number of repossessions. The most recent action on this front was by RBS which stated that it would give a 6 month reprieve to its mortgage customers that are in arrears before initiating court repossession orders. Whilst the measures will undoubtedly mean that less homes will now be repossessed than would have otherwise been the case, however it does act as a two edged sword in that whilst supply of repossessed homes onto the market will be less, at the same time the mortgage banks are being forced to carry loss making loans that prove costly to administer and without bringing in much needed revenue i.e. tieing up resources that could have gone to more profitable mortgage customers. The Governments initiatives to reduce repossessions will have no discernable impact on the housing market price trends either positive or negative due to the points about tieing up capital in loss making costly to administer loan accounts. The number of homes expected to be repossessed during 2008 is now revised lower to 55,000 with the expectations of 65,000 homes for 2009 in advance of further government interventions in the housing market to prevent repossessions on an larger scale. The government is engaged on a programme of forcing down mortgage interest rates by a series of deep unprecedented cuts in UK interest rates towards the target of 1% , and possibly even lower to make up the shortfall in the lack of responsiveness by mortgage lenders in cutting their rates, who at the same time have tightened lending criteria due to the increased risk of defaults. The mortgage interest rates have fallen significantly from the credit crisis extremes and are heading to below 4% which implies a strong pointer for support for house prices as the cost of servicing mortgages falls and therefore should support a recovery in housing prices. However the housing market has always been that of being driven by sentiment, in that it is the trend in house prices that is most significant and NOT the cost of servicing the mortgages, it is this which pushed house prices to above X7 earnings, where people were prepared to take on large mortgages at high interest rates for the prime reason that house price gains in the order of 15% per annum or more were far above that of the mortgage interest payments of typically 6%. However now that the housing bubble has burst has resulted in the trend and sentiment reversing as house prices have already fallen by nearly 20%, which equates to a loss of  £40,000 on an average  £200,000 house that is now worth  £160,000, which averages to a fall in value of  £2500 per month. Against which a typical mortgage of say  £160k on a  £200k property at 6% would result in monthly interest charge of  £800 per month. Now with mortgage rates having typically fallen to 4% which is resulting in an reduced interest payment of  £533 per month or a significant fall of  £277 per month that many commentators are taking as a cue for imminent price stability. Unfortunately the  £277 saving is just above 10% of the amount that home owners are typically losing in value per month! Therefore the interest rate cuts are having little if no effect on the housing market, I first warned of this likely outcome back in February 2008 that interest rate cuts will not stop hous e prices from falling. This therefore implies that low interest rates are not an important factor at this point in determining house price trend during 2009, as housing market sentiment is decidedly bearish and will take time to first stabilise and then start to recover. UK Economic Recession Unemployment UK unemployment has probably already risen above 2 million by the time Decembers data is released in March, with the original UK unemployment forecast for a rise to 2.6 million by April 2010 now destined to be breached as the UK economy targets a severe recession on par with that of the early 1980s rather than the more milder one of the 1990s. Increasing expectations are that the UK economy will contract by 3% GDP during 2009 which implies that the UK is heading for an unemployment rate that could pass above 3,000,000 by early 2010. Therefore this confirms that the UK housing market is at least 15 months away from a period of stabilising in nominal terms i.e. where house prices stop falling. The actual trigger for a resumption of the housing bull market would be a sustained period of falling unemployment with the trigger level of 2,000,000 expected to act as a strong marker for year on year housing market recovery as occurred following the last housing bear market. This suggests that the housing market may not embark on an sustainable up trend for as longs as another 4 years and thus points to a period of house price stagnation that will following the current crash in UK house prices. http://www.marketoracle.co.uk Credit Crunch a credit crunch is a period in the economy, distinct from a recession or depression, but potentially heralding one or the other. Credit crunch including mortgage loans, personal loans, car finance, credit cards and other type o f lending become much harder to obtain in a credit crunch. Credit crunch has completely changed the face of the global economy with hundreds of business. From banks and capital markets at given interest rates. The reduced availability of credit can result from many factors, including an increased perception of risk on the part of lenders, ann imposition of credit controls, or a sharp restriction of the money supply. www.teachmefinance.com A sudden reduction in the availability of loans and other types of credit Eg: Lehman brothers. Supply Factor Affecting House Price Immigration There had been a large influx of over 800,000 migrants from the Accession states who contributed towards the buy to let market bubble Strong UK Economy The UK economy at the centre of the worlds credit bubble continued to outperform mainland Europe, which looked on with envy from the less flexible and more regulated European countries of France and Germany, though as we find out during 2009, not participating in the credit boom did not help them as many of the European banks become belatedly suckered into buying U.S. subprime mortgage backed toxic securitized debt as one the last to fling themselves onto the debt derivatives pyramid.

Technology Addicts :: Technological Communication Essays

Technology Addicts Five empty chairs form a circle in the center of the room. Slowly but surely, people begin to make their way into the room. A young man dressed in a black suit sits down with his Newsweek and briefcase. He adjusts his tie, clears his throat, and pushes his wire-rimmed glasses up onto the bridge of his nose. A teenage girl sits down beside him, tucking blonde strands of hair behind her ears to reveal tiny white headphones attached to her iPod. She crosses her right leg over the left, tapping her foot in mid-air to the beat. The worn wooden door creaks open again, slamming shut behind a twenty-something carrying a thin silver laptop computer. He slouches down into the chair with an exasperated sigh and begins to type furiously at the keyboard. The businessman glares over the top of his glasses at him when the familiar chimes of instant messaging become as frequent as the taps of the keys. The young man continues, oblivious to his surroundings. The clock on the wall ticks closer to seven o'clock as the last two people amble in. A middle-aged woman sits down with her knitting, occasionally stopping to jot notes in the sleek PDA beside her. Finally, a woman with a clipboard comes through the door and takes her seat, completing the circle. She clears her throat and begins. "Good evening, and welcome to group therapy. Let's go over the ground rules: First no technology allowed at meetings. Put away your iPod, laptops, PDAs, etc. RIGHT NOW. And don't bring them back to these meetings or they will be confiscated." The group members scowl as they slowly wind up wires. "My only other rule is that you participate. You won't get anything out of group therapy if you don't put anything into it. Let's begin." * * * What would our lives be like if technology were our life support? We would probably not be able to go an entire day without emails, instant messaging, or the World Wide Web. Cell phones might as well be permanently attached to our ears.

Chemotherapy: Understanding the Basics

There are many ways to give chemotherapy; as an IV where medication is put into he body using veins (usually in your arm), or as a catheter, or an IV that stays in a blood vessel in your chest, so a normal IV doesn't have to stay stuck in your arm. More ways that chemo can be given are pills, capsules, or liquids, shots into the muscle and skin, or as an injection into an area below the spinal cord. Places to give chemotherapy are hospitals, cancer centers, doctor's offices, and at home.Many patients receive chemo in hospitals and clinics, while others may need to stay in a hospital so doctors can look over them. Chemo may be given at different times such as every day, every week, or every month. Between treatments the patient needs time to rest. Undergoing chemo might have uncomfortable side effects caused by the medications, the amount taken, and the general health of the patient. Most side effects don't last long because the healthy cells multiply and side effects eventually go aw ay.Cancer patients get lots of TTL (tender, love, and care), like lots of food and water, physical therapy, medicines, etc. This type of care helps patients get through treatments and avoid side effects such as nausea and vomiting. This most common effect of chemo Is fatigue. Tiredness can last for days, weeks, or months, but It eventually goes away once the treatment Is over. Rest can assist the body to recover from chemo. Short-term side effects caused by chemo are stomach problems Like not being hungry, constipation, diarrhea, nausea, and vomiting.Some drugs used In chemotherapy might cause problems that bother or harm the bladder or kidneys. Another Issue caused by chemo Is brief depression and confusion, which should disappear when treatment Is finished. More side effects can be blood disorders Like anemia and blood clotting. Any organ Like the heart, lungs, brain, kidneys, and liver can be affected by chemo for a long period of time. Factors Like the type of drug and/or chemo and whether the patient was treated with radiation at the same time he or she was receiving the treatment may cause a higher risk of cancer later on.It can be hard to deal with cancer and cancer treatment. Even If the side effects are uncomfortable, It's Important to make the patient happy and ensure that chemo Is administered. Chemotherapy: Understanding the Basics By accepted effect of chemo is fatigue. Tiredness can last for days, weeks, or months, but it eventually goes away once the treatment is over. Rest can assist the body to recover Short-term side effects caused by chemo are stomach problems like not being hungry, constipation, diarrhea, nausea, and vomiting.Some drugs used in Another issue caused by chemo is brief depression and confusion, which should sappier when treatment is finished. More side effects can be blood disorders like Any organ like the heart, lungs, brain, kidneys, and liver can be affected by chemo for a long period of time. Factors like the type of drug and/or chemo and whether the patient was treated with radiation at the same time he or she was receiving the It can be hard to deal with cancer and cancer treatment. Even if the side effects are uncomfortable, it's important to make the patient happy and ensure that chemo is administered.

Planning of support for individuals Essay

Assess potential issues which could arise from the involvement of several professionals in the planning of support for individuals Care plans are set out and designed to understand a service user’s needs, preference and choices. You must always discuss how they important for empowering them. If you constantly give a service user no choice in what they would like they will stop trying and become independent they will no longer feel they have any worth or value in the care home, and their self-awareness and self-esteem will decrease meaning their self-concept is at a low. They could feel marginalised and pushed out of option. When caring for someone you must make them feel empowered and capable of still doing things on their own otherwise they will give up. There is core principles and values that are also set out to advices cares on how a person should be treated, for example being treated as an individual, this means every person has the right be treat the way they would like to and the norm of how a person should be cared for, example with respect and their dignity maintained. Taking away a patient preference and choice does not treat them as an individual. This limits them from opportunities and chances, which is not what a health and social care professional should or would do. They would try to encourage a person, make sure they do not feel independent or even alone, allow them to make their own decisions on certain things they are entitled too. Ethnic issues could be of a certain religion or someone with ethnical background of rules that means they can’t eat meat, or no blood transfusions etc. Staff members must understand what other possible approaches such as meals or other treatment can be put in place, so the staff should speak to the patient about options. All staff and patients should respect their diverse way of living, in a care plan you would have to include that this person had these circumstances so that anyone who will care for them knows about it, and could make sure the person was treat correctly throughout his life in care. Making sure different religious rules and attitudes are followed extremely carefully so they are not disturbed or feel unwelcome in their own care home. Staff who will care for the patient should always be understood and the care plan always should state his religion and issues which may always occur. For example Pauline is 35 and is in need of dialysis. She is refusing treatment because she is scared of the treatment which she believes is invasive. She has been counselled about the nature of the treatment –Â  there are no alternatives that would be of practical benefit. She is competent to make treatment decisions. She understands that if she refuses she will die. She has a daughter of 15 years who lives at home. The clinician feels very strongly that she should receive treatment but despite numerous attempts to persuade her she refuses. Many issues can arise from that case study. Another issue occurring would be if for example a woman’s religion meant she could not be seen by a male doctor then her lifestyle choice should and would have to be respected and a female member of staff would have to treat her, in replace of the male. This is her individual preference and choice being respected and taken into consideration.

How well does Shell fulfil the needs of its stakeholders Essays

How well does Shell fulfil the needs of its stakeholders Essays How well does Shell fulfil the needs of its stakeholders Essay How well does Shell fulfil the needs of its stakeholders Essay A stakeholder is any individual or group which has a stake in a company. They therefore include the employees, suppliers, creditors, customers, shareholders and local communities that are affected by the actions of the business. I will be investigating whether Shell is able to fulfil all the needs of it stakeholders, by using secondary data collected from the company website and newspaper articles, in order to evaluate whether Shell has adopted either the stakeholder concept or the shareholder concept, and from this I will evaluate whether there are any conflicts between the stakeholders of Shell. If a business adopts the shareholders concept, this means that the main and sole objective of the business is to maximise the value of the company, so in practice the management tries to make the shareholders as much profit as possible. Therefore any decisions that the management makes is in the interests of the stakeholders, which means that the business avoids conflicting objectives. The advantages of this are that, in the short term, the business may be able to improve its short term profitability, as they do not make any philanthropic donations, or spend money trying to satisfy any stakeholders. The stakeholder concept has more objectives than just making the shareholders as much profit as possible, although this still remains one of the goals of the business, and the business attempts to fulfil the needs of all groups and individuals who are connected to the business. More and more businesses are adopting this concept, because it can improve a business reputation, and therefore give it a competitive advantage and can also attract socially responsible investors. However, problems can arise when the views of one stakeholder clash with the views of another. Royal Dutch Shell (or Shell) is a multinational group of energy and petrochemical companies, which has bases in over 130 countries and more than 108,000 employees. It describes itself as a company that operates in environmentally and socially responsible ways, safely and profitably, however its competitive advantage is in its innovative methods of exploration and production of chemicals, as its reputation is still being built, due to a lot of controversy that has surrounded Shell for decades. Shell wants to be seen as a socially responsible business that takes into account all the needs of its stakeholders, for example by looking for alternative sources of energy to replace finite resources, such as petrol. It is one of the biggest private sector organisations in the world, and in terms of operating profit, in 2006 it was the third most profitable company according to newspaper report, after making just over $26 million dollars after taxation. It 5 Year Financial Summary also shows that its income before taxation has increased every year from 2002 to 2006, and in fact has increased by over 155% in the past five years. This shows that investors are happy, because they are being rewarded for their investment by gaining a substantial profit, which has grown largely due to rocketing oil and fuel prices. Shells record profits were largely due to record oil prices, especially in petrol, where the price topped a dollar barrel. Furthermore, the growth of production in Nigeria has helped to increase profits of the largest European oil company. In fact Shell was one of the only major oil companies to turn a profit in the 2nd quarter of 2007 (April to June), after a fall in profits was expected due to a 2% decrease in production. Furthermore, earnings per share have increased by over 168% in the past 5 years, which shows that the value of their investment is improving continuously. However, the controversy surrounding Shell often leads to a fall in share prices, for example when Shell overstated its oil reserves by 20%, which caused investor anger, and a lot of selling of shares, which decreased the companies market value by $15 billion. A record profit is good news for employees, as if the company is growing, and then there is more money to explore for oil and gas, which means that their jobs are more secure. An example is Shells i 350 million investment programme for investments in Scotland, which it says will safeguard 300 jobs and create 100 new contractor jobs. Furthermore, Shell tried to address it social Royal Dutch Shells website says it recognises that employees are also a valuable stakeholder in the company and that their opinions are of the utmost importance, so it has a very democratic style in that it tries to listen to all employees and discuss are held before decisions are made, as they believe that that this management style is the best fit for their company. Shell published a document in 2000 called People and Principles, in which it emphasised how its beliefs in being a socially responsible company, which attracted a lot of graduates into the company. However, since then Shell has gained a lot of bad publicity, especially as they are often in trouble over employee safety, such as their operations in the North Sea of the coast of Scotland, where lapses in safety procedures have caused a variety of complaints to be made. Concerns have been raised by unions about the decrease in key personnel since Shell announced the sale of the instillations, which could leave staff unable to manage in the case of an emergency. Another example is the danger faced by their workers in Nigeria, due to pipeline explosions and the kidnap of oil workers in the Delta region. Fears have grown among employees and this in turn affects Shells share prices, which is bad news for investors as well. Despite the fact that Shell claims to get their resources in the most environmentally responsible way, they are often at loggerheads with another stakeholders, the environmentalists, because although Shell has more than one objective, the environmentalists only have one, to protect the environment, and Shell continues to be heavily criticised for its environmental record. An example of this is in late July this year; Shell announced that they were to begin drilling for oil in the arctic, off the shore off Alaska, America. Environmentalists believe that the impact of drilling on the wildlife (such as bowhead whales) would be catastrophic; however Shell (and its shareholders) opposed this. Furthermore, Russia has threatened to revoke Shells license for the development of oil and gas skills, due to what they believe to be Shells inability to address the safety concerns surrounding their Sakhalin project. Added to this, the Argentine government ordered Shell to shut down one of its refineries in Buenos Aires, as they discovered that the site didnt have the correct environmental permits and had failed to conduct the necessary impact studies. Action was taken after government inspections uncovered soil pollution and the Argentine government also accused Shell of illegally taking water from a local estuary. On all occasions, Royal Dutch Shell has fiercely defended itself, however the frequency of the allegations has damaged the reputation Shell has tried to build, as an ethically responsible company, and further disillusioned environmentalists about how socially responsible Shell is. Overall, I believe that for such a competitive industry such as energy and chemicals, and with such a large company such as Shell, it is inevitable that there will be some clashes between stakeholders (such as the environmentalists and the stakeholders), because they all have different aims. I also believe that is impossible for Shell to fulfil all the needs of its stakeholders, because clashes between stakeholders means Shell often has to side with one or a group of stakeholders, which at the moment seems to be the shareholders. I believe Shell must do more to prove that it is a socially responsible company, in order to satisfy the needs of more of its stakeholders, for example doing more to address safety concerns and increasing the investment in local communities in the countries where it explores for oil and gas, and increasing the amount of money it puts into making its process as environmentally friendly as possible. Although, initially this would cost some money, the shareholders would eventually see a return in the longer term, because the benefits of building a reputation as a socially responsible company would attract a lot of new customers. Furthermore, it would attract the best graduates to the company, and would mean fewer disputes with local communities and governments, which would not only save money but also benefit Shells reputation.

Finding Success by Attending College essays

Finding Success by Attending College essays When a little child is asked, "what would you like to be when you grow up?" there are so many responses to this question. I remember when I was a little girl and I was asked this question my answer was "I want to be a doctor when I grow up." That was about 11 years ago. From since then my answer to that question has changed from doctor to computer programmer to physician assistant to finally an accountant. If I were asked that question today my response would be "I want to go to college and get my masters degree in accounting, become an independent young woman, get married and start my own family, and just be happy and successful." As the only young woman in my family, a lot is expected from me. This is why it is and obligation to go to college and achieve my goal to become successful. First of all college is the only way that I know where you can become successful in this world. Without some type of degree in your hand, it will be very hard to make it in this world. Today if you really want to get your foot through those doors you better have a master's degree or better. I have always been a girl who wants to be in charge. Going to college can give me that advantage in life. As a young girl my mother always said, "Jahniqua, as an African-American especially, in this day and age you have to put your best foot forward in this world if you really want to go high places. If you want to wear all those fancy clothes you see and drive those fancy cars you like then college is the place that you have to go to get that. College is the only place that will get you there and the only thing that will get you respect in this world." Those words have been like words of wisdom to me. There have been plenty of times when I just wanted to give up but then those words would just appear in front of me like magic and just give me the strength to keep on going. Those words have been like a reality check for me because I think without them I would h...

Bush Sr & Clinton East Asian Security Approaches Essay Example for Free

Bush Sr & Clinton East Asian Security Approaches Essay President Bush via a main strategic reappraisal as well as continuing below president Clinton together with the U. S Secretaries of Defense Aspin and Perry. The previous administration tried and it is still trying to come into good terms with domestic pressures. It wants a calm dividend as well to adapt what the U. S has been always doing strategically to post cold war circumstances in a safe plus cautious way. All of this assists in helping to keep alive the rationales behind a United States bilateral security relationship with its Northeast Asian allies. Regardless of these echoes of the cold war, there is no one who can escape the truth that the cold war is presently over and that the Soviet Union does no longer exist. Furthermore, in Northeast Asia, also, the need has emerged to restructure U. S post Cold War alliances in order to make them fit the moments. A revision of the bilateral alliance relations goes on; there has been mounting interest in applying multilateral approaches towards the region’s issues. The Clinton administration did not have a well developed vision for what it intended to do in the Asia Pacific region during the time it entered the office. This seems to exactly know how it intended to deal with Asia by putting greater emphasis relatively within diplomacy as well security on a multilateral means over bilateral venues. During the first Clinton administration, inspiration regarding this approach appears to stalk from a bit reluctant admiration for the ways Southeast Asian states have tried to utilize multilateral techniques. The successes enjoyed by hatchling economic organizations in Asia such like the Pacific Basin Economic Council, the APEC forum and the Pacific Economic Cooperation Council. In any case, Assistant Secretary of State for East Asia together with the Pacific Affairs Winston Lord signaled the administration of Clinton. They signaled because Clinton had an intention of relaxing past United States objections towards multilateralism. He intended to do this by stating the goal the administration had towards Asia Pacific region. The goal was just to develop the multilateral forums for safety consultations while maintaining the sold foundation of the alliances. President Clinton has put more emphasis on the multilateral theme when he emphasized the phrase which was â€Å"a new Pacific community†. Winston used this expression earlier on although President Clinton placed it at the center stage internationally. Tokyo gets preoccupied by domestic political turmoil. It got preoccupied because the Japanese seemed to be reluctant to let the well known aspects of their bilateral security go. During the President Clinton administration, was somehow captivated because of the repayments multilateralism tent to give. The major disparagement of the United States governmental enthusiasm came from PRC. Despite the fact that Chinese suspected the idea, there was no any sign that what the Clinton administration was carrying on amounted to a closet form of unilateralism. The prospect for Northeast Asian multilateralism is so challenging. President Clinton, tent to give support concerning multilateral approaches in dealing with the problems of East Asia’s security. In the earlier administration, multilateralism was refused in support of reliance entirely on the existing bilateral alliances. The good security framework for the region consisted of a fan together with its base in Northern America and radiating west across the Pacific. The administration of Clinton reaffirmed the existing security alliances. It called for new equipments multilateral in character which was to supplement the U. S bilateral arrangements in dealing with the present emerging security problems. Washington did not advocate developing new comprehensive agencies, for example the conference on security and cooperation in Asia or the Northeast Asia Treaty Organization within this context. The multilateral agencies are going to be constructed for specific problems and they will differ in membership and the structure as required due to the administration of Clinton. The emphasis on a return towards a more traditional approach to a foreign policy in Asia is actually a prominence on bilateral and unilateral initiatives against multilateral ones. A larger focus on narrow military security issues over economic together with the marginalization of newer issues such as health and environment. However, there was tension and twist in the bush’s administration. The tension was concerning the conflict among the open trade wing of the Republican Party. The tension really emphasizes admission to the markets in promotion of U. S corporate interests. It again emphasized on the more security oriented folks who recognized military threats as the overriding concern of United States policy in the region. As a result, the tension was well-defined in assembly than in the executive branch. Pressure was far above the ground in White House depending on Bush’s arrangements to the key economic posts. The pressure was on the treasury, the United States Trade Representatives together with the description of the National Economic Council. Interweave was not similar with traditional realists. Some members of Bush’s Asia overseas policy squad saw a responsibility for advancing electoral democracy abroad. They saw it as a way of enhancing the economic welfare along with the safety of the United States within the area. During the Clinton’s administration, he tried to position rhetorically more emphasis on the two Asia Pacific forums. He again put more emphasis on the Association of Southeast Asian Nations Post Ministerial Conference plus the new ASEAN Regional Forum. As far as multilateralism is concerned, the Clinton administration expressed a readiness to pay attention in letting nations of the region decide on the regional problems instead of dictating them from Washington. Even if the Clinton administration acted in agreement with these promises they are still not clear. The idea of the President Clinton’s administration did not become a reality with reference to multilateral agencies in supplementing United States bilateral associations. It intended to give a framework for security dialogue as well as the cooperation. It wanted to do this by offering the potential to redress the most stressing aspects of the present approaches to achieving security objectives in East Asia. Bush has foreign policy advisers who had a significant experience about Asia. These advisers really shaped the Bush administration policy towards Asia; from the time Bush signified that he had a big personal interest in associations with Latin America and Europe. Relating to the economic issues, there is a slight difference linking the Clinton administration as well as the Bush administration. Bush seems to be more of an unconditional free trader. That means that even the present modest efforts at integrating environmental and labor matters into bilateral trade agreements will not be present from the Bush outline. This fact will be greeted with sighs of relief between the business leaders together with the region’s political leaders. The biggest change under Bush’s administration was a greater emphasis on intensifying the alliances. He wanted to intensify alliances on matters concerning bilateral with Japan, the Philippines, South Korea and Thailand. That created the establishment of the cold war-era security structural design in Asia. Bush noted that people must show the American powers and purpose in supporting Asian people. That meant that they must keep their promise to discourage violent behavior against the Republic of Korea as well as strengthening security ties with Japan. That was through expanding theater missile defenses between their allies. The main motivation for USG participation in East Asia has always been right of entry to the markets of Asia. In one way or the other the Bush administration determined to strengthen the United States and Japan alliance. He intended to strengthen them by encouraging Japan to play a significant role concerning security matters within the region. That includes the redefining assignment of Japan’s self-protection armed forces as well as paying more of the bills. It is not clear at all that there is support either in the area as a whole or within Japan for Japan to assume a better security task. From China’s opinion, Bush’s success raises the view of stronger White House assistance for theatre in addition to nationwide missile protection systems. His success again raises the advanced levels of United States arms supplies to Taiwan of which Beijing stubbornly opposes. Gore administration gave greater scope to organized labor than Bush White House. The AFL-CIO did not manage to prevent the Clinton administration against pursuing trade at no cost with China. Alternatively Japan has been far less pleased with the next term of the Clinton administration compared to China. Japan resented the downgrading of the United States associations as the keystone in Asia. Clinton’s administration gave acknowledgment on a regular basis to bilateral. He emphasized on U. S and South Korean initiatives within the current cautious steps in the direction of finishing the isolation of North Korea. It is said that President Clinton passed over Japan during his visit to Beijing which was done in the year 1998. There are some issues whereby the Bush administration differs drastically with the Clinton administration. It is said that the Clinton’s administration, there were actually some few foreign policy conquest stories. That was the negotiation of the established structure in the year 1994. North Korea arranged to chill its nuclear plan in trade for the structure of two nuclear reactors as well as fuel oil shipments. During the time when the United States had to follow the guide of South Korean President together with the North, connection eased and pressures on the neck of land were at their depths of despair in memory. During the administration of Bush it really threatened to demoralize the significant development which was made within this area. Congregational republicans over-involved time after time the implementation of the framework. It did this by preserving appropriations, even if South Korea and Japan provided the enormous bulk of the funds beneath the agreement. There are a good number of very essential continuities among the Clinton as well as the Bush administration concerning East Asian security policy. This should not surprise as much as the Clinton administration embraced a lot of bedrocks of post cold war East Asian. They inherited this from the first Bush administration which was actually based on long time United States interests. It might be surprising if at all there were not permanence across administration for the reason that the basics of the US security policy within East Asia really transcend administrations. It is very necessary to recall the aforesaid fundamentals of continuity since the Bush foreign policy team came to office. The Clinton administration had already a bad work with virtually every aspect of the East Asian security policy. It might be astonishing if at all there was no permanence within administrations for the reason that the basics of US security policy in East Asia go beyond administrations (Martin, 112). It is very essential to recall the aforementioned elements of continuity since the Bush foreign policy team appeared to the office. The Clinton administration did not do a good job with virtually every aspect of East Asia security policy. The only way to distinguish the Bush administration with the one for Clinton is that there was a lot of reticent to insist that the core of gravity of United States security policy within East Asia is the coalition with Japan. The Clinton administration was not sure whether China or Japan was significant. it was too preventive in connections with Taiwan even if in fairness, as far as security matters is concerned. The Clinton Defense Department started inquiring very seriously into the state of Taiwan’s defenses and it also started pressing Taiwan to recover the software characteristic of their defense attitude. Bush administration was too captivated with multilateralism that was unsuitable for the region or had the potential to deteriorate bi-lateral alliances. The administration of Bush had a more customary approach meaning that it is not likely to involve Asia effectively on two wide areas of growing concern. That is global environmental matters for example the climate change, ozone, invasive species and global health matters such like communicable diseases. Bush did not propose the ratification of the Kyoto Protocol. He did not consider China’s proposal that greenhouse gas discharge be restricted on a per capita basis instead of a per country basis. The very poor records that were kept by Bush concerning the environment in Texas didn’t bode very well in engaging Asia on essential environmental issues. However, the first Bush administration is more likely to be fragmented, incoherent as well as contradictory. It suffered from the vision thing for so many reasons. In the first place, the Bush administration lacked a clear mandate. When he was campaigning, the new president did not offer sound foreign policy plan as a package, Asia countries included. Last but not least, East Asia has really undergone a considerable transformation since the time President Bush started ruling. Nevertheless, the coverage of this revolution in the western press is over and over again restricted to articles on China’s environmental problems or North Korea’ nuclear ambitions. Most of the East Asia’s leaders believe that for United States policy toward East Asia which has always remained essentially bilateral as well as ad hoc for decades to go on to be valuable, it must be updated to reflect more accurately contemporary realities in the region. Finally, Multilateral as well as unilateral sanctions have always been imposed on Iran in order to increase the pressure on its regime. The United States puts more prominence on its wide range of unilateral sanctions. Works Cited Glen, S. Axis of Evil and Rogue States: The Bush Administration. Washington: Glen Segell Publishers, 2006. Martin, G. International Relations Theory for the Twenty-First Century. Routledge, 2007. Seung, H. North Korea’s Second Nuclear Crisis and Northeast Asian Security. New York: Ashgate Publishing Ltd, 2007. Bush Sr & Clinton East Asian Security Approaches. (2016, Jul 31). We have essays on the following topics that may be of interest to you

Strategic Training Paper Essay Example | Topics and Well Written Essays - 750 words

Strategic Training Paper - Essay Example Human resource management is also instrumental in determining and utilizing the strategic position of organizations in a competitive environment. Google Inc. is one such organization that uses human resource development as part of its competitive strategy. Its co-founders, Sergey Brin and Larry Page, put every effort to design Googleplex (headquarters complex of Google) as a lively and fun place to work. From a small web firm, Google Inc. has emerged as a dominant industry giant over the past 12 years. Google’s set of available resources and capabilities enables it to build a strategy focused on company’s internal environment rather than following the market trends. According to Robert Grant, â€Å"When the external environment is in a state of flux, the firm itself, in terms of its bundle of resources and capabilities, may be a much more stable basis on which to define its identity†. The firm values its employees with a number of benefits, performance rewards an d is also considering wide expansion to its current human resource. A highly qualified and unique workforce is one of the prime resources of Google Inc. Organizations often tend to systematically evaluate potential employees in terms of setting up future performance targets at the time of hiring. Human resource development plays an important role in achieving cost effective and performance based targets. Rastogi (2000) noted that human capital is an important input for organizations especially for employees’ continuous improvement mainly on knowledge, skills and abilities. Successful integration of business and workforce concerns is the strategic ability distinguishing the organizations from each other. Google as an organization has been able to acquire this ability to a greater extent and thus enjoys a firm competitive advantage. In order to utilize human resources to formulate effective competitive strategy, organizations should improve their ability to recruit, develop and retain employees. Reich (1998) has described human resource development as, "to attract and keep talented people, companies today are not just experimenting with how they approach the competitive marketplace of goods and services; they are also experimenting with how they approach the competitive marketplace of talent†. An organization requires its employees' competence in achieving the present as well as future performance goals. As a company, Google is fully aware of the fact that employees’ commitment and devotion are the keys in developing a long-term competitive strategy. So, Google has its own unique way to encourage and value employed workforce in order to motivate their commitment towards innovative pursuits. For instance, an engineer at Google, Peter Norvig says that few years back the average search took about 3 seconds. Now, it requires around 0.2 seconds, but still it's not fast enough compared to zero second. Despite facing growing criticism over its disti nctive human resource recruitment methodology, the company has managed to maintain its competitive edge. The company's success among other technology giants is undoubtedly due to loyalty and strong commitment of its employees. Google offers a highest remuneration package and other thoughtful set of factors in return to their valuable services. For an organization to implement strategy effectively, it must consider human resource development as key strategic partner. Human resource policies and practices determine the goals and

USB device encryption. Types of USB flash drives Essay

USB device encryption. Types of USB flash drives - Essay Example Corsair flash padlock Kingston data Traveler secure Ironkey secure Flash drive Lexar jumpdrive secure II Looks like pull-off cap with Numeric pad down the front Uses 256-bit AES hardware based encryption Uses AES,CBC-mode, 128-bit encryption Uses 256-bit AES encryption Has speed of 15.9MB/sec Speed of 20.2MB/sec Speed of 18MB/sec (4GB) 15.5MB/sec Has average read rate of 15.4MB/sec Read rate of 24MB/sec Read rate 25MB/sec 15.9MB/sec Price range between $27-$39 for 1GB Price from $60 for 512MB Price $149 for 4GB and $71.50 for 1GB Price ranges $15.48 for 1GB has five numbered buttons as entry to security No minimum characters required. Generate password to about 99 characters. 32 characters for name and password I would recommend Kingston data traveler secure flash drive. This is because it is small in size thus portable. Too its password protection and its data encryption are compatible with several operating systems such as windows 2000, windows XP and Win98SE. The flash device has high speed both read and write. It durability cannot be doubted. That is why there is a five year warranty on a device bought. Data protection is the base line of this device. It has a higher security levels. Its high memory also acts as advantage to this device as privacy edition can hold up to 8GB. Computer foot print Creating a new foot print Downey and Stein have outlined how to create a new foot print. In the library manager screen first choose create new footprint. Name the footprint appropriately using an appropriate name such as ‘mybank†. Make a drawing of the outline in the zoomed window. Select save as and thereafter choose on create new library button. Create a new directory with the details about the bank accounts. Name the directory such as â€Å"library†. This has to be separate from where the layout and capture files were initially stored. Give a name to the new library file such as â€Å"homefile†. Save it in â€Å"mybank†. At last th ere are two files â€Å"homefile† that contain the foot print â€Å"mybank† Using ones EID credentials, log into foot prints of your bank. Click on the new request button that appears at the top-left corner. The incident information has then to be filled. The notes should be through so as to supply ITS with enough information for quick identification and to easily resolve the issue. The contact information is updated in the contact information. The information can be modified as it may be appropriate so as to enable contact with the ITS. The data is then saved. The updates are received through the email or by logging into the footprint system. Data on the details will be displayed in a â€Å"hours per day† and â€Å"days per month†. Time/days location ISP provider processor RAM Computer IP 10-11.00 11-12.00 12-1300 The characteristics that will help identify the computer in use will include computer’s IP address, mother board details and also the n ame accorded to it operating system. If access into footprint data is attempted either from a different computer or different way from the characteristics given, access first of all will be denied. The second option will be where one will be asked for a password before accessing the information. The last one will be where an individual must register as members to gain access. HTTPS This is a combination of hyper text transfer

Basic economics Assignment microeconomics Essay

Basic economics Assignment microeconomics - Essay Example a. Price Elasticity of Demand 9 4. b. Short-Run and Long-Run Price Elasticity 12 4. c. Price Elasticity of Demand for a Particular Brand 13 4. d. If Price Elasticity of Demand for Cigarettes Is Inelastic 13 References 14 Bibliography 15 1. a. Impact on ‘Law of Demand’ when there is no Scarcity of Resources According to a theory of ‘Law of demand’, an inverse relationship exists between quantity demanded by customers and price of products and/or services. If there is no scarcity of resources in a given market, the price of a commodity may fall rapidly which in turn will provide rise to demand of the commodity. As stated in the theory, a decrease in price of a commodity increases its demand in market. Moreover, in economic perspective, human nature is termed to be always demanding which depicts that demand of commodity will continue to rise and thereby affecting its price at large. Therefore, it can be stated that whether there is a scarcity of resources or no t, the ‘Law of Demand’ will still exist (Baumol & Blinder, 2009). Consequently, price rationing can also be observed in this case due to a fact that demands of human-beings are termed to be never-ending or unlimited. However, on the contrary, resources of goods are limited. Thus, price rationing will be strongly evident (Maddala, 2004). Conclusively, from an economic point of view, it can be stated that resources will be efficiently used when there is no scarcity. ... efects of a Market System In the study of microeconomics, three fundamental problems faced by any society are: What goods and/or services can be produced in a given society and what will be an appropriate quantity of production? How to produce the required goods and/or services? The produced goods and/or services will be targeted to which market segment or customers? (Gabay & Et. Al., 2007). On the similar context, price mechanism is referred to as determining prices of goods and/or services with the influence of various forces of demand and supply in a given society. The theory assumes to have no interference in terms of external factors to the society. According to a theory of economics, producers always tend to produce those commodities which can be sold in market at a high price and apply those production techniques which are cost-efficient in order to maximise their profits. Similarly, customers tend to favour products which are less costly and thus it determines the price of th e commodity in a given market. Thus, price mechanism states an interdependent relationship between self-interests of producers and buyers. In other words, actions of producers are regulated by actions of consumers and vice-versa. This efficiently determines quantity of production and price of a commodity, solving the three fundamental problems of a society (Jain & Khanna, 2007). However, there are a few defects that exist in a market which provides rise to various limitations of price mechanism theory. They can be identified as, market competencies, inefficient or wasteful productions, external influences, indolence of commodities, uneven circulation of income and others (Jain & Khanna, 2007). 2. a. Reasoning The aspect of ‘opportunity cost’ can be well identified in this case. It is

The position of non-executive director Essay Example | Topics and Well Written Essays - 1000 words

The position of non-executive director - Essay Example The researcher of the current paper states that there is no distinction made between the responsibilities of a non-executive director and an affiliated director. According the United Kingdom company law, however, both have distinct roles while fulfilling their responsibilities. The affiliated director is an employee of a company and is given an executive position and authority to involve in the day to day business operations of the company; on the other hand, the non-executive director is not an employee of the company; consequently, he or she does not possess an executive position or executive authority similar to the executive position or executive authority extended to the affiliated director. In addition to that, the affiliated director receives salary or remuneration for his or her services performed for the company; on the other hand, the non-executive director charges fees for providing his services for the board. Fundamentally, the functions of the non-executive directors are to provide a creative contribution to the board with the provision of objective criticism. Also, the non-executive directors are required to ponder over the board matters and avoid straying into the executive direction, which is the role of the affiliated directors. And, at the same time, the affiliated directors involve and carry out the executive decisions for the company on day to day basis in contrast to the function of the non-executive director. ... Consequently, the Sarbanes-Oxley 2002, in the United States, and Higgs Review of Non-Executive Directors in 2003, in the United Kingdom, revitalized the role of the non-executive director and gave more clarity to the participation and contribution of the non-executive director. Dispersed and concentrated ownership Particularly, in the United States and the United Kingdom, the dispersed ownership, which is also identified with the term â€Å"outsider systems† (Maher and Andersson, 1999), is featured with relatively high turnover along with widely dispersed share ownership; in the dispersed ownership, a more equitable distribution of information and a considerable emphasis is given to the protection of the shareholders rights and, especially, those of minority investors. On the other hand, concentrated ownership, also known as insider systems, have features such as the presence of ownership concentration or concentration of voting power in a few hands along with a multiplicity o f corporate holdings and inter-firm relationships. The specific examples, denoting the concept of concentrated ownership, include familial control, banks, holding companies and other non-financial institutions. Both types of ownerships offer different sorts of advantages. The dispersed ownership provides the benefits such as extended liquidity of stock; as a result, the investors can easily avail the better risk diversification possibilities; and, at the same time, the corporate governance framework in the dispersed ownership encourages the use of public capital markets (OECD, 1999); on the other hand, the problems such as supervision and monitoring of management, which remains to be a point of high tension in

DISCUSSION QUESTION RESPONSE Essay Example | Topics and Well Written Essays - 250 words - 10

DISCUSSION QUESTION RESPONSE - Essay Example It is true that in higher education, high level of professionalism is expected. My personal though is that the quality of higher education determines the level of professional competence. This is because higher education is responsible in developing and nurturing professionalism in all aspects of the society. We have worked in the military together for some time and travelled to other countries. I noted the same concern with you that the standards of education in our country need to be improved so that the country can improve the standards of professional competence. For instance, professionalism in the military largely depends on the quality of learning and training received from learning institutions and training camps. In your conclusion, you pointed a very important concern for the public. Americans really need to understand the strong correlation between professional competence and higher education. This way, they will be able to uphold the standards and integrity of education thereby improving the standards of professional competence in the

Basic economics Assignment microeconomics Essay

Basic economics Assignment microeconomics - Essay Example a. Price Elasticity of Demand 9 4. b. Short-Run and Long-Run Price Elasticity 12 4. c. Price Elasticity of Demand for a Particular Brand 13 4. d. If Price Elasticity of Demand for Cigarettes Is Inelastic 13 References 14 Bibliography 15 1. a. Impact on ‘Law of Demand’ when there is no Scarcity of Resources According to a theory of ‘Law of demand’, an inverse relationship exists between quantity demanded by customers and price of products and/or services. If there is no scarcity of resources in a given market, the price of a commodity may fall rapidly which in turn will provide rise to demand of the commodity. As stated in the theory, a decrease in price of a commodity increases its demand in market. Moreover, in economic perspective, human nature is termed to be always demanding which depicts that demand of commodity will continue to rise and thereby affecting its price at large. Therefore, it can be stated that whether there is a scarcity of resources or no t, the ‘Law of Demand’ will still exist (Baumol & Blinder, 2009). Consequently, price rationing can also be observed in this case due to a fact that demands of human-beings are termed to be never-ending or unlimited. However, on the contrary, resources of goods are limited. Thus, price rationing will be strongly evident (Maddala, 2004). Conclusively, from an economic point of view, it can be stated that resources will be efficiently used when there is no scarcity. ... efects of a Market System In the study of microeconomics, three fundamental problems faced by any society are: What goods and/or services can be produced in a given society and what will be an appropriate quantity of production? How to produce the required goods and/or services? The produced goods and/or services will be targeted to which market segment or customers? (Gabay & Et. Al., 2007). On the similar context, price mechanism is referred to as determining prices of goods and/or services with the influence of various forces of demand and supply in a given society. The theory assumes to have no interference in terms of external factors to the society. According to a theory of economics, producers always tend to produce those commodities which can be sold in market at a high price and apply those production techniques which are cost-efficient in order to maximise their profits. Similarly, customers tend to favour products which are less costly and thus it determines the price of th e commodity in a given market. Thus, price mechanism states an interdependent relationship between self-interests of producers and buyers. In other words, actions of producers are regulated by actions of consumers and vice-versa. This efficiently determines quantity of production and price of a commodity, solving the three fundamental problems of a society (Jain & Khanna, 2007). However, there are a few defects that exist in a market which provides rise to various limitations of price mechanism theory. They can be identified as, market competencies, inefficient or wasteful productions, external influences, indolence of commodities, uneven circulation of income and others (Jain & Khanna, 2007). 2. a. Reasoning The aspect of ‘opportunity cost’ can be well identified in this case. It is

DISCUSSION QUESTION RESPONSE Essay Example | Topics and Well Written Essays - 250 words - 10

DISCUSSION QUESTION RESPONSE - Essay Example It is true that in higher education, high level of professionalism is expected. My personal though is that the quality of higher education determines the level of professional competence. This is because higher education is responsible in developing and nurturing professionalism in all aspects of the society. We have worked in the military together for some time and travelled to other countries. I noted the same concern with you that the standards of education in our country need to be improved so that the country can improve the standards of professional competence. For instance, professionalism in the military largely depends on the quality of learning and training received from learning institutions and training camps. In your conclusion, you pointed a very important concern for the public. Americans really need to understand the strong correlation between professional competence and higher education. This way, they will be able to uphold the standards and integrity of education thereby improving the standards of professional competence in the

Technology in Hotels Essay Example for Free

Technology in Hotels Essay With the rapid pace of technological advancements and the fast rate of implementing it into everyday life, people need the latest IT facilities. They demand this from hotels as well. But the industry has always been lagging behind the needs, not being able to offer the latest advances in technology. Now management has started to take note of the guest’s needs and is aware that technology is a very competitive advantage and is starting to adjust their strategies in consequence. Boutique hotels offering sci-fi levels of technology are starting to emerge and may be prefiguring the future of hospitality as a whole. I Introduction With technology advancing now faster than ever before, everyone needs and demands using the latest technological means just to survive. Such is the case in the hotel industry too, especially in the upper-class and boutiques hotels area of the market. With hotels always lagging behind other sectors in adopting new IT systems ( PLUGGED IN, 2009; Buick, 2003), keeping the pace with customers’ demands becomes a pressing issue to hospitality providers. This problem is acknowledged by the players in the industry, being debated in trade-specific publications, conferences and academic literature. There are two sides of the use of technology in hotels: â€Å"back of house† systems (property management systems, revenue management systems, internal control instruments etc.) and technology that is used directly and mainly by the consumers. The following review aims to put the current technological state, future trends and most pressing issues of the hotel and hospitality industry i nto perspective. II Literature review The newest trends in the hospitality industry show an emphasis on the experience delivered to the customer and not so much on the tangible aspect of the product. With the service sector beginning to dominate the world’s economies, there is a growing concern on delivering meaningful, memorable customer experiences (Meyer and Schwager, 2007). This can be seen from a practitioner’s point of view with The Ritz-Carlton Hotels Company, which prides its self with becoming an â€Å"experience and memory creator† (Nixon and Rieple, 2010). The next generation of clients demands continual technological updates for every business and personal user and hotels often can’t keep up the pace. Property owners are understandably reluctant to renovate as often as needed to support the latest technology, meaning major renovations never happen often enough to keep the tech-crazy guests satisfied (Russ, 2008). No longer are people going to hotels to experience something new, but hoteliers are looking at guests as technology consumers and supply little more than the average customer demands (Freed, 2010). The use of modern technology can help hotel employees deliver a service of better quality and also enhance the stay for guests by satisfying their needs, thus creating a better all-round experience. This view, however, is not unanimous across the whole of the industry. Even though 82.4% of managers believe that IT is important for increasing customer satisfaction (Brewer et al, 2008), they also worry that the benefits provided by investments in technology are not as high as expected (ITGI, 2007). Research shows that companies around the world are losing out on their investments because they can’t derive sufficient value from these investments in IT (Bowen, Cheung and Rhode, 2007; ITGI, 2007). Value from IT can be defined as a function whose primary focus is delivering the promised benefits (Mathe, 2009) and as a provider of strategic, informational and transactional benefits (Gregor et al, 2006). Therefore, all definitions show that value added by IT leads to successfully achieving business goals and strategies. So a contradiction appears between managers’ beliefs and actions. The majority is certain IT helps their organization but has failed to fully take its benefits yet. Customer satisfaction with the hotel begins shaping before the service is provided, with the process of making the reservation preceding it. The new trends using of mobile platforms such as smart phones, tablets and laptops for shopping (Gupta, 2012) dictate that these means of communication should be targeted by hoteliers. The number of mobile users researching travel options on their mobile devices is expected to grow by 51% in 2012 and another 15% by 2013 (Saio, 2012). A market study by Reuters Synovate Global (plugged in) shows that 47% of potential clients demand the latest technology from the hotels they choose. Also, one third of guests assess a hotel by its website and 50% do research and comparisons online, before making their choice. The same report found that seven out of ten consumers would rather stay in a less expensive hotel and that hi-tech facilities are the top criteria in choosing a hotel. The latest study conducted by Motorola Solution, Inc. (2011) concludes that information technology (IT) spending in the hospitality industry is expected to have increased in 2011, with guest experience being the primary driver for investments. And yet, 57% of the industry’s leaders admit they don’t know how to launch, track and achieve mobile platform success (Eyefortravel, 2012), proving the same contradicting views towards technology. This proves one of the critical challenges for hotel technology managers is convincing upper management to approve investing in the latest technology (Petiza, 2011). According to Gregor et, al. (2006) the failure to measure the value added by IT is due to measurement errors, management practices and time lags between the investment and ROI. The alignment of IT with business strategy and its use may allow competitive advantage to be achieved (Levy and Powell, 2005; Peppard and Ward, 2004). The same opinion is presented in a study conducted by Amadeus (2011), which states that if hotels are to secure growth in the next three years they must align strategy and IT priorities. Peppard and Ward (2004) suggest that IT has become pivotal to the existence of most organisations and that should the technology used by organisations come to a halt, they would cease to function. Now that the importance of using technology is recognized unanimously there are two schools of thought emerging: the first believes that IT should be present to aid the guests inconspicuously from the shadows and the other approach that puts technology in the forefront of the operations and makes it the core theme. Choosing one or the other dictates the whole strategy of the hotel or company. Some guests are not comfortable with technological changes in the lobby, in the room or when trying to make a booking (Withiam, 2007). Others, as shown above, need and demand hi-tech facilities from their hotels. After choosing the market you target, the strategy should be adjusted in consequence. A tool for creating market segments based on consumers’ opinion on technology is a so-called Techno logy Readiness Index (TRI) (Verma et al., 2007). This is a 10 question survey that guests should fill in (Appendix 1). This measures their view of technology on four dimensions: optimism, innovativeness, discomfort and insecurity. Tech-focused individuals are usually thought of in terms of their willingness to innovate, but the research behind TRI measures the extent to which people think IT helps improve their life (optimism), or if they feel overwhelmed by technology (discomfort) or whether they don’t trust devices to operate correctly (insecurity). The over-technologic approach can be best seen in boutique hotels. Taking the forefront in this arms race is somewhat easier with smaller, non-chain, exclusive hotels because they don’t have to maintain the same standards in thousands of rooms across hundreds of hotels around the world. An article by Myers (2011) showcases the latest boutique hotels that offer now desk-free check-in aided by tablet PCs, hybrid cars with Wi-Fi for the guest, 42 inch LCD TVs (The Upper House Hotel, Hong Kong), retina scans just to enter the room (Nine Zero Hotel, New York), touch-screen room controls and bedside iPads (Establishment Hotel, Sydney) or Wii exercise rooms where guest can play virtual tennis (Le Parker Meridian, New York). The latest trends in hotel technological development include converging technologies that complement each other to reach the common goal of customer satisfaction. The hotel room would automatically set itself up to the guest’s unique tastes, based on the pervious information provided through guest profile forms. When the front desk clerk checks-in the guest or the guest checks-in using the self service kiosk in the lobby, the lights in the room automatically turn on and the thermostat sets itself to the users preferred temperature. The entertainment system turns on, playing the guest’s favorite music, TV program or radio station. These services would please the guest but also reduce energy costs by keeping everything turned off when the guest is not using the room. The list of computer operated can include such luxurious services like automatically drawing a bath to be ready at a certain time or automatically open the drapes in the morning in order to wake the guest with natural light and not the old fashioned wakeup call. (Russ, 2008) In order to offer a variety of payment options, some hotel managers have adopted cashless payment systems via the use of radio frequency identification (RFID). RFID utilizes computer chips and antennas, allowing the chips to wirelessly communicate with a receiver. In the hotel industry RFID systems are being integrated with POS systems to process credit card and debit account transactions (Kasavana, 2005). Some hospitality companies even accept biometrics, such as fingerprints, iris scans, facial scans or hand geometry analysis systems to increase physical or data security. III Conclusion Customers are more demanding from hotels in terms of technology than ever. They need it for entertainment, business, communication and socialization. And with technology advancing in a rampant pace, people more aware of the latest gadgets and devices and techno-fear decreasing as new generations come along using technology from infancy, hotels are being pressed into making monumental investments more often just to cater to the technological needs of the guests. Added to these there are the other investments to be made in â€Å"old fashioned† hotel operation, property management systems etc. Studies show that even though customers demand it and managers recognize its importance the hotel industry is still lagging behind in offering the latest IT facilities. However, there are innovative boutique hotels that have reached an almost sci-fi level of technology. These hotels are shaking the position of the big hotel chains and are attracting more tech-crazy guests. On the other side there are hotels that focus more on the environment, nature with a more traditional approach. Both have their own well established market segments that usually don’t overlap because of being on different ends of the spectrum. Only the future can say of this arms race to demand and provide more and more technological means will prove effective. It is commonly known that too much of something can become harmful.

Attitude of Unlisted Companies Towards IFRS

Attitude of Unlisted Companies Towards IFRS SECTION I INTRODUCTION The adoption of international financial reporting standards across the European Union from 1st January 2005 is one of the biggest events in the accounting history. This is especially important after the capital markets were rocked by some big accounting frauds in recent years. In the first phase, 7000-plus listed European companies will have to implement new financial reporting standards from January 2005 (Fuller, Jan 2005). When European Union moved towards one market across Europe, it faced the prospect of different financial reporting regimes across EU participants. To achieve true scale of financial integration, it has become necessary to adopt common financial reporting standards. In June 2002, the European Commission adopted a regulation requiring all listed EU companies in regulated markets to prepare their financial statements in accordance with International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS). The regulation is applicable only on consolidated accounts and companies are free to choose their national GAAPs for subsidiaries and associate companies. The regulation came into force from January 2005. Companies Act 1985 governs the use of UK GAAP by UK based companies. Similarly other EU states have their own laws for accounting standards. The EU states have now modified their national laws to include IFRS regulation to offer a common financial reporting standard. Companies Act 1985 (International Accounting Standards and Other Accounting Amendments) Regulations 2004 has extended the application, on a non-compulsory basis, of the EU IFRS regulation to all non-charitable organisations. In the last quarter of previous century, the world economies have moved towards globalisation. Multinational companies are manufacturing and selling across the world and many of these firms are listed at foreign stock exchanges. Globalisation of markets and establishment of multinationals led to increased desire and awareness about international markets. This was soon followed by globalisation of financial markets which increased the value of understanding of international financial results and reporting formats. Rapid improvement in communication technologies and easy access through internet has further spread the profile of international investor. Now a day international investors are not limited to some portfolio managers in big banks. International investors are now as diverse as sophisticated equity manager to a small investor in a remote town. Investors too have diversified their portfolio by international equities and bonds. This rapid globalisation has fuelled the desire to h ave common international standards that could be understood and followed across nations. The ever increasing network of investors has not only opened new financing sources to countries, it has also put some pressure on the financial regulatory authorities to design and improve their financial reporting systems in a manner that is easily understood by wider audiences. The regulatory authorities have on one hand evolve the financial reporting system to match the ever increasing demands of international investors and on the other hand make sure that companies in their countries are not faced with sudden increase in time, resources and knowledge needed to cope with new regulations.   In 1973, 9 countries included UK formed International Accounting Standards Committee (IASC) with an aim to develop common accounting standards. The membership has now grown well over hundred countries with each country, especially bigger economies, bringing in their own perspectives of accounting standards. IASC had to deal with accounting conflictions in coming up with common acceptable accounting standards. One would immediately think whether IASC has been successful in resolving all the conflicts with all member countries and the answer would easily be no. To fully satisfy more than hundred accounting bodies from across the world is almost an impossible task. Yet IASC has done a commendable job and from 1 January 2005, International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS) is applicable in more than 90 countries. In EU, IFRS is compulsory only for listed companies. The standards that UK listed companies will follow are not those issued directly by the International Accounting Standards Board, but are those that have been endorsed by the European Commission. EU has now endorsed IFRS, except for IFRS 6 and some of the IFRIC interpretations, and some changes in IAS 39 relating to the fair value of financial instruments (PwC, 2005a). While the EU regulation is only enforceable on listed companies, it also says that a member state has an option to extend the use of IFRS to unlisted companies within their jurisdiction. Department of Trade and Industry (DTI), the government trade body responsible for company regulation in UK, has said that while there is no mandatory move to IFRS for unlisted companies, the unlisted companies would still be allowed to adopt IFRS over UK GAAP from 2005 onwards. The basic aim of new financial reporting standards is same as that of existing standards – to provide information about financial performance and position of a company to different stakeholders. Internal stakeholders – management – normally have a good grip of what’s going in the business. It is external stakeholders like investors, auditors, suppliers and creditors who need to be informed in a succinct and clear manner about financial implications of business decisions. The IFRS would aim to present a more complete picture of a business by making operating income a more encompassing number. As an example, the financial implications of stock options were kept out of income statements. Companies merely mentioned the number of stock options granted. But now onwards, companies will have to incorporate the fair costs of granting stock options in their income statements. This will allow investors to assess the true costs of executive remuneration. Though the overall aim is same, the differences in implementation and financial reporting do occur due to social, economic and political backgrounds of different nations. Will it be a good policy to allow two different accounting standards in UK – one standard for listed companies and another for unlisted companies. UK’s Accounting Standard Board clearly sees there is no merit in having two separate standards. ASB issued a Discussion Paper in March 2004 highlighting its strategy for convergence with IAS and says that convergence of UK accounting standards to IAS is a foregone conclusion. It has already introduced many changes in recent past to bring UK’s GAAP in line with IFRS. Smaller companies, even listed ones, will find it difficult to cope with extra work due to IFRS. Alternative Investment Market (AIM) realises that most of its companies won’t be in a position to meet IFRS requirements soon. So it changed its regulatory status in October 2004 and is now an â€Å"exchange regulated market† and out of purview of European Commission regulation on regulated markets. Now companies listed on AIM have time until January 2007 to implement IFRS. Accounting Standards Board is also sensitive to the needs placed on business in making a transition from UK accounting standards to IFRS. Big businesses probably have sufficient resources to cope with the change in one year. But the smaller businesses will find it difficult to make all required changes in one year. ASB has proposed a series of changes that would be implemented in 2005 and 2006 which will bring UK financial reporting standards more in line with IFRS. Thereafter ASB will carry out a series of step changes by replacing one or more UK standards. So by the end of 2005-2006, UK standards will almost be in line with IFRS and unlisted companies transition to IFRS in 2007 would be smooth. This research analyses the attitude of unlisted companies towards IFRS. Many research and surveys have been carried out on the acceptance and readiness of listed companies for transition to IFRS. But the issue has not been explored in depth with respect to unlisted companies. The research is based on primary and secondary data. Primary data is collected via interviews and questionnaires with companies and their auditors. A total of [34] interviews – [20] with companies and [14] with their auditors – were conducted to obtain primary data. [52] questionnaire responses by postal survey were also analysed. The results show that there is definitely a much scope in improving International Financial Reporting Standards for unlisted companies. Respondents were concerned about the costs associated with transition to IFRS and also the additional burden that will come with regular enhanced reporting. That IFRS will help in globalisation of capital markets and probably cheaper costs of capital is not of much significance for unlisted companies registered in UK. This research would be useful for institutes and associations framing accounting standards for unlisted companies. Mostly accounting standards have been framed with an eye for listed and large companies. But unlisted companies have much lesser resources to spend on large regulatory requirements and hence should have different reporting requirements that match the benefits obtained from such reporting. The time limitation and resource constraint mean that the primary data via interviews and questionnaire surveys could only be collected through a limited number of respondents. It would be useful to cover a larger data base before implementing the changes. Also more users of data in unlisted companies like banks and creditors should be contacted before policy formulation. The remaining paper is divided in the following sections. Section II is a literature review on justification and applicability of IFRS, and state of readiness in companies. Section III discusses the methodology used in this research. Section IV covers analysis of data obtained through the primary data collection and its interpretation. The paper concludes with section V. SECTION II LITERATURE REVIEW In June 2000, the European Commission proposed a new directive requiring that all publicly traded companies in the member states to adopt International Accounting Standards Board (IASB) standards by no later than January 2005. On 19 July 2002, the European Parliament and the Council approved the IAS regulation (EC) 1606/2002 which said ‘For each financial year starting on or after 1 January 2005, companies governed by the law of a Member State shall prepare their consolidated accounts in conformity with the international accounting standards adopted †¦ if, at their balance sheet date, their securities are admitted to trading on a regulated market of any Member State’ (EU, 2002). Rationale for EU’s adoption of International Financial Reporting Standards The main aim of International Financial reporting Standards is to bring convergence among different national financial reporting standards. Over time, the evolution of different national financial reporting standards has been influenced by local social, political and economic environments. Some of the major reasons for differences in accounting standards are: Political – Capitalist or Communist. Capitalist and communist countries have almost contrasting fundamental economic approach and their accounting standards reflect the same. Stage of economic development. Developed countries generally have better accounting standards in terms of transparency and clarity. Corporate finance – debt or equity. Companies in continental Europe are financed more by debt than the companies in UK. Accounting standards have over time evolved to reflect the importance placed by different sources of financing on different aspects of financial statements. Legal and taxation systems. Convergence will help investors and analysts to compare companies across borders in a better way. But it also implies that either member countries will lose their independence to make national accounting standards that reflect local economic conditions or if they start introducing some changes, IFRS may slowly lose its main strength of common standard. Local, political and economical conditions may force national accounting bodies to introduce variations in IFRS. EU has already introduced some changes in the IAS 39 dealing with financial instruments. It is beyond the scope of this research to see which member countries have introduced variations in IFRS. Convergence between UK GAAP and IFRS ASB has declared its intention to converge UK GAAP with IFRS. It has issued a number of new standards in December 2004 to speed up the convergence of UK GAAP with IFRS. So sooner, even unlisted companies would be following a substantial portion of IFRS due to this convergence. Comparison of UK GAAP and IFRS Similarities The ultimate goal of UK GAAP and IFRS is same – to present information about financial performance and position to all concerned stakeholders. If the aim is same, then should be the main approach adopted by both accounting standards. The UK’s Accounting Standard Board’s Statement of Principles for Financial Reporting is a vital contributor at macro level standard setting. It plays almost same role as International Accounting Standards Committee’s ‘Framework for the Preparation and Presentation of Financial Statements’. ‘It is a description of the fundamental approach that the Accounting Standards Board (ASB) believes should, in principle, underpin the financial statements of profit-oriented entities’ (ASB, 1999). The Statement of Principles has true and fair concept at its core, much like the focal point in International Accounting Standards. Also like IAS, Statement of Principles insists on financial information being relevant and comparable. It is beyond the scope of this research to highlight each and every similarity between UK GAAP and IAS. Differences Though the overall aim is same, the differences in implementation and financial reporting do occur due to social, economic and political backgrounds of different nations. Main concepts behind UK GAAP and IFRS are same, but when we look at micro level, we see many differences at the individual standards level. Following are the main differences between UK GAAP and IFRS: The Statement of Principles allows use of both historical cost and current value approaches in measuring balance sheet categories. The dual use of historical and current value methods is known as modified historical cost basis (ASB, 1999). Under historical cost, the carrying values of assets and liabilities are stated at the lower of cost and recoverable amount. This approach is more conservative as compared to IAS approach which uses fair value method. Also the choice of historical or current value method is based on subjective analysis of a company’s management and hence it is open to some manipulation. Fair value. If we look at global level, both UK GAAP and IFRS have adopted fair value method as the foundation of their accounting standards. IFRS takes fair value adoption even higher when it says that income statement will include the changes in the fair value of items that have not been yet traded like derivatives. The emphasis in new accounting standards is on mark-to-market fair value of assets and liabilities rather than on actual market price based fair values. Now both realised and unrealised changes in fair values would be incorporated in income statements. The first year of transition will see high volatility in earnings and balance sheet statements. Though this brings higher volatility, it will also test the management skills in proper presentation and explanation of changes. It may also change the benchmarks of success for managements. Acquisitions. Acquisition accounting will change under new accounting standards. Under UK GAAP, companies can choose between purchase and merger accounting. Under IFRS, companies will have to account under purchase method only. Goodwill. UK GAAP allowed amortisation of goodwill and companies had the option of not segregating intangible assets from goodwill. Under IFRS, intangible assets have to be separated from goodwill. Goodwill can not be amortised now but companies will have to undertake annual impairment tests to justify the value of goodwill on the balance sheets. BAT’s profits for year 2004 increased by  £454m because it no longer had to amortise goodwill of that amount (AccountancyAge, 2005b). Consolidation of accounts. Under new accounting rules, companies may have to consolidate certain additional subsidiaries into group accounts. On the other hand companies will have to exclude certain subsidiaries or special purpose vehicles which were not included till now. Research and development costs. Under IAS 39, research costs can’t be carried on the balance sheet and would have to write them off as incurred. Companies would still be allowed to capitalise development in line with UK GAAP. Stock options. Internet and share market last boom in late 1990s led to rapid increase in share options as a way to reward employees. The new requirements to record an expense on income statement for the value of share options granted to employees could have a significant impact on earnings. AstraZeneca said in its pro forma 2004 IFRS numbers that new accounting rules on stock options has made it re-consider the use of stock options in rewarding its employees (Tricks, 2005). Distributable profits. Organisations ability to pay dividends is dependent on their distributable profits. Following are some of the major impacts of IFRS on distributable profits Inability to discount deferred tax liabilities, higher provisions for deferred tax when companies move from historical costs to fair value and inclusion of pension deficits in income statement. All of the above will reduce distributable profits. Many companies would have to financially restructure themselves in order to have sufficient distributable profits to meet dividends paid in last year. Deferred tax credit. Deferred tax credit is available under UK GAAP but not under IFRS. GlaxoSmithKline’s restated its 2004 earning per share by (1.9p) due to non-availability of deferred tax credit under IFRS (AccountancyAge, 2005a). Inclusion of business disposals gains in profits from operations. BAT’s profits for year 2004 increased by  £1.3bn after it included gains from disposals to operating profits (AccountancyAge, 2005b). Adding disposal gains to operating profits will make it harder for investors and analysts to separate the earnings from continuing businesses. Derivative contracts. Under IFRS, some derivative contracts will not qualify as hedges as they wont meet the criteria. UK GAAP allowed deferment of such contracts until transaction took place. IFRS won’t allow the deferment of such contract and would impact the profit and loss account even before the transaction took place. It is better in a way that investors will know the current value of the firm as on date rather than historical costs of such instruments, especially if the duration of financial instruments was long. At the same time, it would increase the burden on the company to calculate the fair value of all such transactions. Agricultural. UK GAAP allowed companies to use a cost model for biological assets and all agricultural produce. But under IAS companies would have to use mark to market method for valuing such assets. Now companies would have to use market valuation even for assets in far off countries. Advantages of IFRS over UK GAAP Common financial language. Adopting common financial reporting standards will open up a company to more markets and investors. The growth in telecommunications has made it easier for smaller investors to invest across physical boundaries. Such investors are normally not as financially sophisticated as some big financial institutions. They would also not like to understand more than one accounting standards as they don’t have required resources in hand to do so. With one common accounting standard, more investors would like to explore companies across nations. Acquisitions. IFRS 3 is more open and transparent than UK GAAP on acquisitions. It will allow investors and analysts to judge faster the success of an acquisition. Many of the companies that have relied on acquisition as a key cornerstone for growth would now come under intense scrutiny and may have to develop a new strategy for growing business.    Consolidation. In IFRS, all entities will have to provide a cash flow statement. Additionally there would be more transparency within the group companies and this should make the consolidation process more straight-forward. Securitisation by businesses is likely to be impacted by the new ways governing how companies can show assets and liabilities on their financial statements. Companies have used securitisation to cash in assets like trade receivables sitting on their balance sheets. Securitisation helps companies to slim down their balance sheets and hence allows companies to show higher return on assets at same earnings. And it was one of the reasons why companies went for securitisation. But stringent criteria for moving assets and liabilities off balance sheet will threaten securitisation. Sue Harding, chief accountant at Standard Poor’s in Europe said that new international accounting standards were sweeping a lot of securitised assets back on to balance sheets (Jopson, Feb 2005). This will help investors compare like to like and avoid companies that have used securitisation only to make-up their balance sheets. There is no harm in using securitisation if used in a proper way and not to deceive stakeholders. But we have seen how corporations like Enron had used securitisation to disguise their true financial position. Annual impairment review. Annual impairment review will benefit investors because the companies then won’t like to take big goodwill cuts in one year and not do anything for years. Annual reviews would help investors judging whether the amount paid by companies in acquiring other company was justified or not. Access to cheaper capital. Increase in investor profile diversification would most probably lower the cost of capital for most of the companies. This is especially true for smaller companies which don’t have financial muscles and resources to tap international investors. Expensing research costs gives better information to investors and other stakeholders because at research stage the chances of success are quite uncertain. Investors can only be sure of development costs bringing in some returns in future. Also by segregating research and development costs, external stakeholders will now have a better chance to differentiate the suitability of costs incurred in developing new products. Multiple listings. Many companies now have multiple listings across different countries. Companies need to prepare financial statements as per each local accounting standard to meet listing requirements. With one accounting standard only it will save a lot of botheration for companies with multiple listings. Dividends. Under IFRS dividends are not provided for until the dividend recommended by the Board is approved by shareholders. This move will bring more convergence between accounting profits and cash flows. Disadvantages of IFRS Fair value. While fair value in a way conveys more up to date value of a company as compared to historic costs, it also puts a question mark on the methods used and the reliability of fair value. Derivative instruments which are commonly traded on various stock exchanges can be easily assigned value. So while valuing some of the assets or liabilities may not be difficult, the question still remains what impact such valuations will have on companies’ business models. Many companies use hedging instruments as a strategic tool rather than for intentional gains. Any short-term swings in such instruments may have a significant impact on income statement and probably adverse market reactions may deter companies’ from using such instruments. Then comes the more important issue of valuing assets and liabilities that don’t have a proper market. The companies may use some valuation model, which itself may not be the right way, to value an asset or liability. The model will incorporate some subjective assumptions. An example would be brand value. A same brand can have two different values for two different companies because of its strategic importance. So at one hand, investors and other external stakeholders are getting more objective information about a companies’ assets and liabilities, they are also getting valuation based on more subjective assessments. Only time will tell whether some individuals or companies will use it to manipulate results. An interesting thing to observe would be the treatment and importance given by analysts to unrealised fair value of assets and liabilities. Some investors may try to separate unrealised gains and losses from other operational performance. It may also prompt companies to issue adjusted earnings excluding unrealised gains and losses. An important point to note about fair value principle is that the financial statements should not be seen as perfect prediction of things to come. That depends on the strategic and business decisions management will take in future. Just having a fair value of assets and liabilities doesn’t mean that the company will be able to extract those values in future.    Dividend. New accounting standards promote payment of dividend from distributable reserves. With the inclusion of unrealised gains and losses and pension deficits, the first few years of new accounting standards may not leave enough of distributable reserves for dividend payments. Securitisation. Securitising assets into special purpose vehicles and re-financing them through had also helped companies raise funds at lower costs. The new accounting standards by restricting the use of special purpose vehicles, would diminish some sources of cheap financing. It is question yet to be fully tested in the practical world that since the assets are same, change in financing options shouldn’t change the returns on total assets. By refinancing at lower rates through securitisation should result in higher financing cost for remaining assets such that the overall costs remain same. But examination of this hypothesis is beyond the scope of this dissertation. But what is mostly observed in capital markets is that when companies announce refinancing, the share price rises. How much of the rise is from relief that company will survive and how much from the fact that the overall costs have lowered is not known. Annual impairment tests. Annual impairment tests are easier said than done. Companies would not only have to devote substantial resources to do that first would have to train its personnel to do that. Assessing true value of a goodwill is not easy. If there is a comparable market then companies can easily value it. Even then it may differ from case to case as it would be very unusual to see exactly two similar companies. Goodwill is very different from tangible assets or technologies and depends a lot on market perception and strategy. Companies would have to review the whole process of valuing goodwill and would have to review the valuation process at constant intervals. Net pension liability. The inclusion of net pension liability on the balance sheet may have severe impact on the shareholders funds. Companies will be required to have annual actuarial valuation of their pension liabilities and the same would be reflected in financial statements. Most of the pension funds invest in equity markets, which have been quite volatile in the recent years. So though over a longer period, the movements in pension liabilities may even out but in short to medium term, it may have a dramatic effect on balance sheets and earning statements. Segmental information. IAS 14 requires companies to report information on their business segments and on a scale more detail than UK GAAP. As of date, no agreed accounting practices have emerged on how much should be disclosed because companies may end up revealing sensitive information to its competitors. If companies disclose the turnover, earnings and expenditure for each segment, its profitable operations may come under intense competition. Ian Dilks of PwC said that â€Å"some companies have found they’re giving much more information than they’re comfortable with on sales and the profitability of product areas† (Tricks, 2005) Expensing research costs may result in listed companies focusing more on products in development stage than in research stage. This will keep their balance sheets healthy but may harm long term prospects. Complex and long IFRS compliant reports. PricewaterhouseCoopers estimates that an IFRS compliant financial report for insurance companies could be up to twice as long as those prepared under existing UK GAAP (Finn Zoon, 2004). The requirement for other industry sectors though may not be as intensive as for insurance sector, their IFRS compliant financial may also be longer and resource intensive than under UK GAAP. Any company that has makes an acquisition will have to do annual goodwill impairment analysis and most of them would like to explain the results also. Comparable formats. IAS 1 is less prescriptive than the UK GAAP when it comes to the format of the balance sheet and income statement. It just distinguishes current and non-current assets and liabilities. Investors, when faced with different formats, may find it difficult to compare companies. Modify organisation structures. Meall (2003) suggested that the additional burden of more financial reporting along different segments may force companies to modify their existing organisational structures within their financial systems to collect and analyse data. Impact of IFRS on different industries IFRS will have different impact on different industries. For some, most of the applied UK GAAP is almost same as IFRS and won’t feel the difference. But for some industries, the difference in accounting standards may have a substantial impact. Financial services and insurance companies are among them. Financial services companies would be affected by substantial change in recognition and measurement of financial instruments under IAS 39. UK GAAP has no equivalent to IAS 4 which deals with insurance contracts. Insurance companies would now have to account for this in their financial statements. Under IFRS, insurance companies would have to book financial instruments such as derivatives at market value rather than historical value allowed under UK GAAP. Many insurers have said that this will distort their earnings (Reuters, 2005a). IFRS will put more stringent criteria for classification of insurance products and this may lead to reclassification of some insurance products as investment products. Other industries that might face higher impact are the ones that heavily use hedging instruments in their day to day operations. Mostly companies using commodity materials like oil as a significant part of their input costs use hedging to smooth over the volatile changes in commodity markets. New accounting standards will reduce Tesco’s projected annual profit of  £2,000m by  £30m only, a reduction of 1.5%. But for some companies the impact would be much more. Royal Sun Alliance said that new accounting rules would reduce its net assets by  £400m (Reuters, 2005a). This is a big number by any standards and shareholders Attitude of Unlisted Companies Towards IFRS Attitude of Unlisted Companies Towards IFRS SECTION I INTRODUCTION The adoption of international financial reporting standards across the European Union from 1st January 2005 is one of the biggest events in the accounting history. This is especially important after the capital markets were rocked by some big accounting frauds in recent years. In the first phase, 7000-plus listed European companies will have to implement new financial reporting standards from January 2005 (Fuller, Jan 2005). When European Union moved towards one market across Europe, it faced the prospect of different financial reporting regimes across EU participants. To achieve true scale of financial integration, it has become necessary to adopt common financial reporting standards. In June 2002, the European Commission adopted a regulation requiring all listed EU companies in regulated markets to prepare their financial statements in accordance with International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS). The regulation is applicable only on consolidated accounts and companies are free to choose their national GAAPs for subsidiaries and associate companies. The regulation came into force from January 2005. Companies Act 1985 governs the use of UK GAAP by UK based companies. Similarly other EU states have their own laws for accounting standards. The EU states have now modified their national laws to include IFRS regulation to offer a common financial reporting standard. Companies Act 1985 (International Accounting Standards and Other Accounting Amendments) Regulations 2004 has extended the application, on a non-compulsory basis, of the EU IFRS regulation to all non-charitable organisations. In the last quarter of previous century, the world economies have moved towards globalisation. Multinational companies are manufacturing and selling across the world and many of these firms are listed at foreign stock exchanges. Globalisation of markets and establishment of multinationals led to increased desire and awareness about international markets. This was soon followed by globalisation of financial markets which increased the value of understanding of international financial results and reporting formats. Rapid improvement in communication technologies and easy access through internet has further spread the profile of international investor. Now a day international investors are not limited to some portfolio managers in big banks. International investors are now as diverse as sophisticated equity manager to a small investor in a remote town. Investors too have diversified their portfolio by international equities and bonds. This rapid globalisation has fuelled the desire to h ave common international standards that could be understood and followed across nations. The ever increasing network of investors has not only opened new financing sources to countries, it has also put some pressure on the financial regulatory authorities to design and improve their financial reporting systems in a manner that is easily understood by wider audiences. The regulatory authorities have on one hand evolve the financial reporting system to match the ever increasing demands of international investors and on the other hand make sure that companies in their countries are not faced with sudden increase in time, resources and knowledge needed to cope with new regulations.   In 1973, 9 countries included UK formed International Accounting Standards Committee (IASC) with an aim to develop common accounting standards. The membership has now grown well over hundred countries with each country, especially bigger economies, bringing in their own perspectives of accounting standards. IASC had to deal with accounting conflictions in coming up with common acceptable accounting standards. One would immediately think whether IASC has been successful in resolving all the conflicts with all member countries and the answer would easily be no. To fully satisfy more than hundred accounting bodies from across the world is almost an impossible task. Yet IASC has done a commendable job and from 1 January 2005, International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS) is applicable in more than 90 countries. In EU, IFRS is compulsory only for listed companies. The standards that UK listed companies will follow are not those issued directly by the International Accounting Standards Board, but are those that have been endorsed by the European Commission. EU has now endorsed IFRS, except for IFRS 6 and some of the IFRIC interpretations, and some changes in IAS 39 relating to the fair value of financial instruments (PwC, 2005a). While the EU regulation is only enforceable on listed companies, it also says that a member state has an option to extend the use of IFRS to unlisted companies within their jurisdiction. Department of Trade and Industry (DTI), the government trade body responsible for company regulation in UK, has said that while there is no mandatory move to IFRS for unlisted companies, the unlisted companies would still be allowed to adopt IFRS over UK GAAP from 2005 onwards. The basic aim of new financial reporting standards is same as that of existing standards – to provide information about financial performance and position of a company to different stakeholders. Internal stakeholders – management – normally have a good grip of what’s going in the business. It is external stakeholders like investors, auditors, suppliers and creditors who need to be informed in a succinct and clear manner about financial implications of business decisions. The IFRS would aim to present a more complete picture of a business by making operating income a more encompassing number. As an example, the financial implications of stock options were kept out of income statements. Companies merely mentioned the number of stock options granted. But now onwards, companies will have to incorporate the fair costs of granting stock options in their income statements. This will allow investors to assess the true costs of executive remuneration. Though the overall aim is same, the differences in implementation and financial reporting do occur due to social, economic and political backgrounds of different nations. Will it be a good policy to allow two different accounting standards in UK – one standard for listed companies and another for unlisted companies. UK’s Accounting Standard Board clearly sees there is no merit in having two separate standards. ASB issued a Discussion Paper in March 2004 highlighting its strategy for convergence with IAS and says that convergence of UK accounting standards to IAS is a foregone conclusion. It has already introduced many changes in recent past to bring UK’s GAAP in line with IFRS. Smaller companies, even listed ones, will find it difficult to cope with extra work due to IFRS. Alternative Investment Market (AIM) realises that most of its companies won’t be in a position to meet IFRS requirements soon. So it changed its regulatory status in October 2004 and is now an â€Å"exchange regulated market† and out of purview of European Commission regulation on regulated markets. Now companies listed on AIM have time until January 2007 to implement IFRS. Accounting Standards Board is also sensitive to the needs placed on business in making a transition from UK accounting standards to IFRS. Big businesses probably have sufficient resources to cope with the change in one year. But the smaller businesses will find it difficult to make all required changes in one year. ASB has proposed a series of changes that would be implemented in 2005 and 2006 which will bring UK financial reporting standards more in line with IFRS. Thereafter ASB will carry out a series of step changes by replacing one or more UK standards. So by the end of 2005-2006, UK standards will almost be in line with IFRS and unlisted companies transition to IFRS in 2007 would be smooth. This research analyses the attitude of unlisted companies towards IFRS. Many research and surveys have been carried out on the acceptance and readiness of listed companies for transition to IFRS. But the issue has not been explored in depth with respect to unlisted companies. The research is based on primary and secondary data. Primary data is collected via interviews and questionnaires with companies and their auditors. A total of [34] interviews – [20] with companies and [14] with their auditors – were conducted to obtain primary data. [52] questionnaire responses by postal survey were also analysed. The results show that there is definitely a much scope in improving International Financial Reporting Standards for unlisted companies. Respondents were concerned about the costs associated with transition to IFRS and also the additional burden that will come with regular enhanced reporting. That IFRS will help in globalisation of capital markets and probably cheaper costs of capital is not of much significance for unlisted companies registered in UK. This research would be useful for institutes and associations framing accounting standards for unlisted companies. Mostly accounting standards have been framed with an eye for listed and large companies. But unlisted companies have much lesser resources to spend on large regulatory requirements and hence should have different reporting requirements that match the benefits obtained from such reporting. The time limitation and resource constraint mean that the primary data via interviews and questionnaire surveys could only be collected through a limited number of respondents. It would be useful to cover a larger data base before implementing the changes. Also more users of data in unlisted companies like banks and creditors should be contacted before policy formulation. The remaining paper is divided in the following sections. Section II is a literature review on justification and applicability of IFRS, and state of readiness in companies. Section III discusses the methodology used in this research. Section IV covers analysis of data obtained through the primary data collection and its interpretation. The paper concludes with section V. SECTION II LITERATURE REVIEW In June 2000, the European Commission proposed a new directive requiring that all publicly traded companies in the member states to adopt International Accounting Standards Board (IASB) standards by no later than January 2005. On 19 July 2002, the European Parliament and the Council approved the IAS regulation (EC) 1606/2002 which said ‘For each financial year starting on or after 1 January 2005, companies governed by the law of a Member State shall prepare their consolidated accounts in conformity with the international accounting standards adopted †¦ if, at their balance sheet date, their securities are admitted to trading on a regulated market of any Member State’ (EU, 2002). Rationale for EU’s adoption of International Financial Reporting Standards The main aim of International Financial reporting Standards is to bring convergence among different national financial reporting standards. Over time, the evolution of different national financial reporting standards has been influenced by local social, political and economic environments. Some of the major reasons for differences in accounting standards are: Political – Capitalist or Communist. Capitalist and communist countries have almost contrasting fundamental economic approach and their accounting standards reflect the same. Stage of economic development. Developed countries generally have better accounting standards in terms of transparency and clarity. Corporate finance – debt or equity. Companies in continental Europe are financed more by debt than the companies in UK. Accounting standards have over time evolved to reflect the importance placed by different sources of financing on different aspects of financial statements. Legal and taxation systems. Convergence will help investors and analysts to compare companies across borders in a better way. But it also implies that either member countries will lose their independence to make national accounting standards that reflect local economic conditions or if they start introducing some changes, IFRS may slowly lose its main strength of common standard. Local, political and economical conditions may force national accounting bodies to introduce variations in IFRS. EU has already introduced some changes in the IAS 39 dealing with financial instruments. It is beyond the scope of this research to see which member countries have introduced variations in IFRS. Convergence between UK GAAP and IFRS ASB has declared its intention to converge UK GAAP with IFRS. It has issued a number of new standards in December 2004 to speed up the convergence of UK GAAP with IFRS. So sooner, even unlisted companies would be following a substantial portion of IFRS due to this convergence. Comparison of UK GAAP and IFRS Similarities The ultimate goal of UK GAAP and IFRS is same – to present information about financial performance and position to all concerned stakeholders. If the aim is same, then should be the main approach adopted by both accounting standards. The UK’s Accounting Standard Board’s Statement of Principles for Financial Reporting is a vital contributor at macro level standard setting. It plays almost same role as International Accounting Standards Committee’s ‘Framework for the Preparation and Presentation of Financial Statements’. ‘It is a description of the fundamental approach that the Accounting Standards Board (ASB) believes should, in principle, underpin the financial statements of profit-oriented entities’ (ASB, 1999). The Statement of Principles has true and fair concept at its core, much like the focal point in International Accounting Standards. Also like IAS, Statement of Principles insists on financial information being relevant and comparable. It is beyond the scope of this research to highlight each and every similarity between UK GAAP and IAS. Differences Though the overall aim is same, the differences in implementation and financial reporting do occur due to social, economic and political backgrounds of different nations. Main concepts behind UK GAAP and IFRS are same, but when we look at micro level, we see many differences at the individual standards level. Following are the main differences between UK GAAP and IFRS: The Statement of Principles allows use of both historical cost and current value approaches in measuring balance sheet categories. The dual use of historical and current value methods is known as modified historical cost basis (ASB, 1999). Under historical cost, the carrying values of assets and liabilities are stated at the lower of cost and recoverable amount. This approach is more conservative as compared to IAS approach which uses fair value method. Also the choice of historical or current value method is based on subjective analysis of a company’s management and hence it is open to some manipulation. Fair value. If we look at global level, both UK GAAP and IFRS have adopted fair value method as the foundation of their accounting standards. IFRS takes fair value adoption even higher when it says that income statement will include the changes in the fair value of items that have not been yet traded like derivatives. The emphasis in new accounting standards is on mark-to-market fair value of assets and liabilities rather than on actual market price based fair values. Now both realised and unrealised changes in fair values would be incorporated in income statements. The first year of transition will see high volatility in earnings and balance sheet statements. Though this brings higher volatility, it will also test the management skills in proper presentation and explanation of changes. It may also change the benchmarks of success for managements. Acquisitions. Acquisition accounting will change under new accounting standards. Under UK GAAP, companies can choose between purchase and merger accounting. Under IFRS, companies will have to account under purchase method only. Goodwill. UK GAAP allowed amortisation of goodwill and companies had the option of not segregating intangible assets from goodwill. Under IFRS, intangible assets have to be separated from goodwill. Goodwill can not be amortised now but companies will have to undertake annual impairment tests to justify the value of goodwill on the balance sheets. BAT’s profits for year 2004 increased by  £454m because it no longer had to amortise goodwill of that amount (AccountancyAge, 2005b). Consolidation of accounts. Under new accounting rules, companies may have to consolidate certain additional subsidiaries into group accounts. On the other hand companies will have to exclude certain subsidiaries or special purpose vehicles which were not included till now. Research and development costs. Under IAS 39, research costs can’t be carried on the balance sheet and would have to write them off as incurred. Companies would still be allowed to capitalise development in line with UK GAAP. Stock options. Internet and share market last boom in late 1990s led to rapid increase in share options as a way to reward employees. The new requirements to record an expense on income statement for the value of share options granted to employees could have a significant impact on earnings. AstraZeneca said in its pro forma 2004 IFRS numbers that new accounting rules on stock options has made it re-consider the use of stock options in rewarding its employees (Tricks, 2005). Distributable profits. Organisations ability to pay dividends is dependent on their distributable profits. Following are some of the major impacts of IFRS on distributable profits Inability to discount deferred tax liabilities, higher provisions for deferred tax when companies move from historical costs to fair value and inclusion of pension deficits in income statement. All of the above will reduce distributable profits. Many companies would have to financially restructure themselves in order to have sufficient distributable profits to meet dividends paid in last year. Deferred tax credit. Deferred tax credit is available under UK GAAP but not under IFRS. GlaxoSmithKline’s restated its 2004 earning per share by (1.9p) due to non-availability of deferred tax credit under IFRS (AccountancyAge, 2005a). Inclusion of business disposals gains in profits from operations. BAT’s profits for year 2004 increased by  £1.3bn after it included gains from disposals to operating profits (AccountancyAge, 2005b). Adding disposal gains to operating profits will make it harder for investors and analysts to separate the earnings from continuing businesses. Derivative contracts. Under IFRS, some derivative contracts will not qualify as hedges as they wont meet the criteria. UK GAAP allowed deferment of such contracts until transaction took place. IFRS won’t allow the deferment of such contract and would impact the profit and loss account even before the transaction took place. It is better in a way that investors will know the current value of the firm as on date rather than historical costs of such instruments, especially if the duration of financial instruments was long. At the same time, it would increase the burden on the company to calculate the fair value of all such transactions. Agricultural. UK GAAP allowed companies to use a cost model for biological assets and all agricultural produce. But under IAS companies would have to use mark to market method for valuing such assets. Now companies would have to use market valuation even for assets in far off countries. Advantages of IFRS over UK GAAP Common financial language. Adopting common financial reporting standards will open up a company to more markets and investors. The growth in telecommunications has made it easier for smaller investors to invest across physical boundaries. Such investors are normally not as financially sophisticated as some big financial institutions. They would also not like to understand more than one accounting standards as they don’t have required resources in hand to do so. With one common accounting standard, more investors would like to explore companies across nations. Acquisitions. IFRS 3 is more open and transparent than UK GAAP on acquisitions. It will allow investors and analysts to judge faster the success of an acquisition. Many of the companies that have relied on acquisition as a key cornerstone for growth would now come under intense scrutiny and may have to develop a new strategy for growing business.    Consolidation. In IFRS, all entities will have to provide a cash flow statement. Additionally there would be more transparency within the group companies and this should make the consolidation process more straight-forward. Securitisation by businesses is likely to be impacted by the new ways governing how companies can show assets and liabilities on their financial statements. Companies have used securitisation to cash in assets like trade receivables sitting on their balance sheets. Securitisation helps companies to slim down their balance sheets and hence allows companies to show higher return on assets at same earnings. And it was one of the reasons why companies went for securitisation. But stringent criteria for moving assets and liabilities off balance sheet will threaten securitisation. Sue Harding, chief accountant at Standard Poor’s in Europe said that new international accounting standards were sweeping a lot of securitised assets back on to balance sheets (Jopson, Feb 2005). This will help investors compare like to like and avoid companies that have used securitisation only to make-up their balance sheets. There is no harm in using securitisation if used in a proper way and not to deceive stakeholders. But we have seen how corporations like Enron had used securitisation to disguise their true financial position. Annual impairment review. Annual impairment review will benefit investors because the companies then won’t like to take big goodwill cuts in one year and not do anything for years. Annual reviews would help investors judging whether the amount paid by companies in acquiring other company was justified or not. Access to cheaper capital. Increase in investor profile diversification would most probably lower the cost of capital for most of the companies. This is especially true for smaller companies which don’t have financial muscles and resources to tap international investors. Expensing research costs gives better information to investors and other stakeholders because at research stage the chances of success are quite uncertain. Investors can only be sure of development costs bringing in some returns in future. Also by segregating research and development costs, external stakeholders will now have a better chance to differentiate the suitability of costs incurred in developing new products. Multiple listings. Many companies now have multiple listings across different countries. Companies need to prepare financial statements as per each local accounting standard to meet listing requirements. With one accounting standard only it will save a lot of botheration for companies with multiple listings. Dividends. Under IFRS dividends are not provided for until the dividend recommended by the Board is approved by shareholders. This move will bring more convergence between accounting profits and cash flows. Disadvantages of IFRS Fair value. While fair value in a way conveys more up to date value of a company as compared to historic costs, it also puts a question mark on the methods used and the reliability of fair value. Derivative instruments which are commonly traded on various stock exchanges can be easily assigned value. So while valuing some of the assets or liabilities may not be difficult, the question still remains what impact such valuations will have on companies’ business models. Many companies use hedging instruments as a strategic tool rather than for intentional gains. Any short-term swings in such instruments may have a significant impact on income statement and probably adverse market reactions may deter companies’ from using such instruments. Then comes the more important issue of valuing assets and liabilities that don’t have a proper market. The companies may use some valuation model, which itself may not be the right way, to value an asset or liability. The model will incorporate some subjective assumptions. An example would be brand value. A same brand can have two different values for two different companies because of its strategic importance. So at one hand, investors and other external stakeholders are getting more objective information about a companies’ assets and liabilities, they are also getting valuation based on more subjective assessments. Only time will tell whether some individuals or companies will use it to manipulate results. An interesting thing to observe would be the treatment and importance given by analysts to unrealised fair value of assets and liabilities. Some investors may try to separate unrealised gains and losses from other operational performance. It may also prompt companies to issue adjusted earnings excluding unrealised gains and losses. An important point to note about fair value principle is that the financial statements should not be seen as perfect prediction of things to come. That depends on the strategic and business decisions management will take in future. Just having a fair value of assets and liabilities doesn’t mean that the company will be able to extract those values in future.    Dividend. New accounting standards promote payment of dividend from distributable reserves. With the inclusion of unrealised gains and losses and pension deficits, the first few years of new accounting standards may not leave enough of distributable reserves for dividend payments. Securitisation. Securitising assets into special purpose vehicles and re-financing them through had also helped companies raise funds at lower costs. The new accounting standards by restricting the use of special purpose vehicles, would diminish some sources of cheap financing. It is question yet to be fully tested in the practical world that since the assets are same, change in financing options shouldn’t change the returns on total assets. By refinancing at lower rates through securitisation should result in higher financing cost for remaining assets such that the overall costs remain same. But examination of this hypothesis is beyond the scope of this dissertation. But what is mostly observed in capital markets is that when companies announce refinancing, the share price rises. How much of the rise is from relief that company will survive and how much from the fact that the overall costs have lowered is not known. Annual impairment tests. Annual impairment tests are easier said than done. Companies would not only have to devote substantial resources to do that first would have to train its personnel to do that. Assessing true value of a goodwill is not easy. If there is a comparable market then companies can easily value it. Even then it may differ from case to case as it would be very unusual to see exactly two similar companies. Goodwill is very different from tangible assets or technologies and depends a lot on market perception and strategy. Companies would have to review the whole process of valuing goodwill and would have to review the valuation process at constant intervals. Net pension liability. The inclusion of net pension liability on the balance sheet may have severe impact on the shareholders funds. Companies will be required to have annual actuarial valuation of their pension liabilities and the same would be reflected in financial statements. Most of the pension funds invest in equity markets, which have been quite volatile in the recent years. So though over a longer period, the movements in pension liabilities may even out but in short to medium term, it may have a dramatic effect on balance sheets and earning statements. Segmental information. IAS 14 requires companies to report information on their business segments and on a scale more detail than UK GAAP. As of date, no agreed accounting practices have emerged on how much should be disclosed because companies may end up revealing sensitive information to its competitors. If companies disclose the turnover, earnings and expenditure for each segment, its profitable operations may come under intense competition. Ian Dilks of PwC said that â€Å"some companies have found they’re giving much more information than they’re comfortable with on sales and the profitability of product areas† (Tricks, 2005) Expensing research costs may result in listed companies focusing more on products in development stage than in research stage. This will keep their balance sheets healthy but may harm long term prospects. Complex and long IFRS compliant reports. PricewaterhouseCoopers estimates that an IFRS compliant financial report for insurance companies could be up to twice as long as those prepared under existing UK GAAP (Finn Zoon, 2004). The requirement for other industry sectors though may not be as intensive as for insurance sector, their IFRS compliant financial may also be longer and resource intensive than under UK GAAP. Any company that has makes an acquisition will have to do annual goodwill impairment analysis and most of them would like to explain the results also. Comparable formats. IAS 1 is less prescriptive than the UK GAAP when it comes to the format of the balance sheet and income statement. It just distinguishes current and non-current assets and liabilities. Investors, when faced with different formats, may find it difficult to compare companies. Modify organisation structures. Meall (2003) suggested that the additional burden of more financial reporting along different segments may force companies to modify their existing organisational structures within their financial systems to collect and analyse data. Impact of IFRS on different industries IFRS will have different impact on different industries. For some, most of the applied UK GAAP is almost same as IFRS and won’t feel the difference. But for some industries, the difference in accounting standards may have a substantial impact. Financial services and insurance companies are among them. Financial services companies would be affected by substantial change in recognition and measurement of financial instruments under IAS 39. UK GAAP has no equivalent to IAS 4 which deals with insurance contracts. Insurance companies would now have to account for this in their financial statements. Under IFRS, insurance companies would have to book financial instruments such as derivatives at market value rather than historical value allowed under UK GAAP. Many insurers have said that this will distort their earnings (Reuters, 2005a). IFRS will put more stringent criteria for classification of insurance products and this may lead to reclassification of some insurance products as investment products. Other industries that might face higher impact are the ones that heavily use hedging instruments in their day to day operations. Mostly companies using commodity materials like oil as a significant part of their input costs use hedging to smooth over the volatile changes in commodity markets. New accounting standards will reduce Tesco’s projected annual profit of  £2,000m by  £30m only, a reduction of 1.5%. But for some companies the impact would be much more. Royal Sun Alliance said that new accounting rules would reduce its net assets by  £400m (Reuters, 2005a). This is a big number by any standards and shareholders