Ba Finance

By 1985 Arthur had already sold his dairy herd to focus on cereal production when a fortuitous meeting with Lucy Bellingham at a business conference led him to reconsider the future of the family farm. Bellingham is a designer of bespoke fitted kitchens who had a business plan but little capital. The plan was to manufacture top quality fitted kitchen furniture and establish design studios/showrooms in high income areas. Having recently sold his dairy herd, Arthur had enough capital to fund the new business and also a number of large barns and outbuildings suitable for manufacturing the kitchen units subject to refitting and planning consent being obtained. Lucy’s business plan was so convincing that Arthur decided to get out of farming altogether (by leasing his arable land to a local co-operative) and focus on developing the new business. From this small beginning grew the now publicly quoted company of Bellingham plc. Initially, showrooms were established in Beaconsfield and then Kensington. Demand for their kitchens was brisk and â€Å"Bellingham Bespoke Kitchens† expanded rapidly but remained a partnership. The firms clients are mainly celebrities from the entertainment world and the cost of a Bellingham Bespoke Kitchen is now ? 40,000 – ? 150,000 or more. The firm was restructured as a limited company in 1990 and subsequently experienced rapid growth until 1999. In that year the then directors decided that the business had reached the limit of development in it’s present form. Future development required large-scale expansion of production facilities in order to provide the range of materials, furniture, quality and prompt delivery required by their discerning clients. This in turn needed an injection of capital that the directors were unable to generate themselves. The conviction that there was much money to be made from â€Å"quality fitted kitchens† † had been vindicated. They investigated a number of possibilities deciding eventually to expand production facilities by purchasing a modern production unit on an industrial estate in Aylesbury. The expansion was funded by a stock market floatation and raising the necessary capital in the name of Bellingham plc. As the market grew and to keep abreast of new production technology, the directors agreed to reverse the maxim so dear to the heart of the founders, Arthur and Lucy; â€Å"neither a (long-term) borrower nor lender be. † They financed updating of equipment and premises by means of issuing debentures. It is now October 2012 and the present directors of Bellingham plc believe that the long-term success of the company lies in future international diversification and expansion. They consider that the most beneficial action they could take is to investigate the acquisition of a subsidiary in the USA. The newly-appointed finance director, Bill Moneypenny, agrees with this opinion but insists that the company must first appraise its own current position and if necessary, make changes to strengthen its existing financial situation before embarking on new plans. He is particularly concerned that the company should preserve adequate liquidity and finance its assets in a beneficial manner. He is also concerned that too much emphasis has been placed on â€Å"pandering to the whims of the rich and famous† and not enough on running an efficient business operation. Lucy and Arthur still retain 30% of Bellingham’s equity and other long-standing directors own a further 20%; a change of control is unlikely to be welcome. During the last two years, the company has updated it’s design, production and showroom assets and, in what has been a difficult year, has been able to maintain sales and profit growth (see Bellingham’s accounts in appendix 1). There has been a great deal of uncertainty about world economic growth and stock markets have been extremely volatile resulting low returns. However the firm’s ordinary shares have made good progress during the year. Ordinary share dividends have achieved substantial growth over the last two years although this rate of increase is not expected to continue. Ordinary dividends have grown at an average rate of 14% per annum over the past 10 years and this rate is a more realistic growth rate for future dividends. The present market prices for Bellingham’s shares and debentures are: ?1 Ordinary shares? 7. 02 ex div ?0. 50p, 6% Pref shares? . 55 ex div 7% Debentures 2016? 100. 51 ex interest Any new venture would be expected to achieve a return on capital employed in line with that experienced recently by Bellingham plc. The finance director favours a payback period of 5 years. Bellingham would therefore need to agree a realistic acquisition price for such a new venture and its future cash flows in order to determine whether these criteria could be met. Although a number of investment projects are being considered, the main proposal currently being investigated offers an expansion into the US prime-property market which is forecast to grow faster than the UK market. Bellingham’s finance director has already calculated the trends in the financial ratios of American Creations, an unquoted US company, from its unaudited annual accounts (see appendix 2) and has concluded that the proposal is now worthy of further investigation. American Creations is a family-owned venture requiring further capital to repair it’s balance sheet after making losses on a property development in Nevada from which it has now withdrawn. Profits have suffered in the last two years due to write-offs associated with this development. The existing owners feel that the firm’s future lies in establishing wider international links and the retirement of senior family members, leaving the younger members active in the management of the firm. They are therefore considering selling a controlling interest of 60% to a suitable company. The firm has been established for 23 years, and is well respected in business circles. The average age of its fixed tangible assets is 3 years. The directors have indicated that they may accept part payment in Bellingham shares subject to negotiation. The firm’s nominal share capital is $2. m, and the directors have indicated that they value the firm at five times the year 2010 net profit. They consider this to be the firm’s â€Å"normal† level of profit excluding the â€Å"extraordinary† effects of the Nevada development. As the firm is at present family owned and run, there is no available price/earnings ratio. P/E ratios for the only two publicly-owned c ompanies in the same business sector, Harvey Wilkinson Designs plc and Cucci Lifestyle plc, are currently 10 and 8 times respectively although both of these firms, unlike Bellingham, operate internationally. Wilkinson has grown at a similar rate to Bellingham. The dividend yields of these companies have been as follows: WilkinsonCucci Year to 31 December 2011 8. 1% 7. 25% 2010 7. 2% 6. 9% 2009 5. 3% 5. 95% American Creations has its own manufacturing facilities and operates throughout the USA and Caribbean with design offices in New York, Miami, Los Angeles and Colorado Springs. Their main business, which is thriving, involves complete home furnishing and interior design for wealthy clients. In addition, the firm has a real estate office in each location and is thus able to offer a complete property service. The value of properties handled by the real estate offices is typically $5m – $20m. Bellingham is interested not only in extending its operations internationally but particularly in the possibility of diversifying into the real estate business. Whilst well aware of the existence of a number of competitors, the directors feel that there is a ready market in the US for their established name in terms of design flair, service and products. After discussions with the directors of American Creations, Bill Moneypenny has produced the following forecast. Under average economic growth conditions, the American Creations operating forecasts (in $*1000) for the next five years are based on the following: Income:from Sales: $7500 in 2013, rising by 12% per annum for the foreseeable future. from real estate sales commissions: $2850 in 2013 increasing by 15% per annum for the foreseeable future. Manufacturing variable costs: Labour: $1250 in 2013, expected to increasing by 8% per annum. Materials: $3800 in 2013, expected to increasing by 5% per annum. Fixed costs excluding depreciation: Manufacturing O/H: $2065 in 2013, increasing by 5% per annum. General O/H: $1850 in 2013, increasing by 2% per annum. Depreciation:Factory, machinery vehicles: $500 per year. Office/Design Studio fixtures: $200 per year. The beta of Bellingham plc is believed to be 1. 65 , the risk-free rate of return is 5. 5% and the return for the last year on the FT All-share index is 2%. UK corporation tax is currently 32% payable 9 months after the end of the accounting year in question (you may assume for the purpose of this case that accounting profit and taxable profit are identical. ) Bellingham’s directors estimate that the after-tax profits of American Creations could be allocated as follows: 70% as retained earnings and 30% as dividends. This has been the pattern under the under the present ownership. There would be no restriction on the transfer of the appropriate share of these dividends to the UK. The US corporation tax rate applicable is 20% payable in the year in which the profit arises. There is no double taxation of profits of US origin in the UK. (For the purpose of this case, ignore the possibility of any withholding taxes and the effects of foreign exchange risk. It is considered possible that, as the US economy develops further, even higher wages than those forecast may be demanded by the workforce. Required: Evaluate the American Creations proposal on behalf of Bellingham plc, supporting your arguments with relevant theory and calculations and indicating any non-financial matters you feel should be taken into consideration. Your report should consider the following areas: 1. An analysis of Bellingham’s current position using relevant financial ratios. You should show the calculation of the ratios and provide interpretation of the results. . Calculation of Bellingham’s cost of capital, using alternative methods and arriving at the most appropriate figure. 3. An investment appraisal of the American Creations proposal assuming the valuation suggested in the case, using a variety of methods and evaluation of the results. 4. A sensitivity analysis of the proposal and interpretation of the results. 5. Calculation and discussion of alternative valuations for acquiring the share in American Creations and how these would impact on the investment appraisal. 6. A discussion of the various available methods of financing the acquisition and consideration of which is the most appropriate. Your calculations and arguments should be supported by relevant theory, with evidence of wide reading around the subject. You should provide a complete bibliography with appropriate referencing in your report. Submission requirements: Your answer should take the form of a written report of approximately 2500 words excluding appendices and the reference list. Deviations from the word count exceeding plus or minus 10% will attract a penalty of 5%. The hand-in deadline for submission is 23. 0 on 25th November 2012. Submissions up to 24 hours late will attract a 10% penalty whilst those beyond 24 hours but less than 1 week late will be capped at 40%. Reports submitted more than one week late will attract a mark of zero. Submit one electronic copy via Studynet. This is an individual assignment and the report submitted should be entirely your own work. Appendix 1:B ellingham plc| | | | | | | Abridged Trading, Profit Loss Account for the year ended 30th June 2012:| All amounts are in thousands of pounds sterling| | | | | | | | | | | | | | | | | | | 2012| | 2011| | 2010| | Sales| 9606| | 7564| | 6100| | Production Cost| 4034| | 3101| | 2240| | Gross Profit| 5572| | 4463| | 3860| | | | | | | | | Selling Expenses| 1467| | 1250| | 1080| | Installation Expenses| 1689| | 1300| | 980| | Administration Expenses| 960| | 630| | 597| | Operating Profit| 1456| | 1283| | 1203| | Debenture Interest| 53| | 53| | 53| | Profit Before Tax| 1403| | 1230| | 1150| | Corporation Tax| 449| | 394| | 368| | Profit After Tax| 954| | 836| | 782| | Dividends| 341| | 280| | 220| | Retained earnings| 613| | 556| | 562| | Balance Sheet at 30th June 2012:| | | | | | | | | | | | | Fixed Assets (net):| | | | | | | Land Buildings| 2300| | 2400| | 2500| | Plant Machinery| 1700| | 1186| | 552| | Fixtures Fittings| 700| | 600| | 402| | Motor Vehicles| 185| | 140| | 105| | Office equiptment| 250| | 185| | 100| | | 5135| | 4511| | 3659| | Current Assets:| | | | | | | Stocks: Raw Materials| 216| | 208| | 182| | Work in Progress| 200| | 205| | 190| | Finished Goods| 150| | 128| | 97| | Debtors| 1775| | 950| | 595| | Bank/Cash| 230| | 136| | 104| | | 2571| | 1627| | 1168| | Current Liabilities:| | | | | | | Trade Creditors| 1190| | 788| | 270| | Corporation Tax| 449| | 394| | 368| | Final Dividend| 171| | 140| | 110| | | 1810| | 1322| | 748| | | | | | | | | Net Current Assets| 761| | 305| | 420| | Net Assets| 5896| | 4816| | 4079| | | | | | | | | Long-term Liabilities:| | | | | | | 9% Debentures 2016| 750| | 750| | 750| | | | | | | | | | 5146| | 4066| | 3329| | | | | | | | | Shares reserves| | | | | | | ?1 ordinary shares| 1000| | 1000| | 1000| | 6% Preference shares of 50p ea,| 500| | 500| | 500| | Retained pr for yr| 613| | 556| | 562| | Profit loss| 3033| | 2010| | 1267| | Shareholders funds| 5146| | 4066| | 3329| | Ba Finance By 1985 Arthur had already sold his dairy herd to focus on cereal production when a fortuitous meeting with Lucy Bellingham at a business conference led him to reconsider the future of the family farm. Bellingham is a designer of bespoke fitted kitchens who had a business plan but little capital. The plan was to manufacture top quality fitted kitchen furniture and establish design studios/showrooms in high income areas. Having recently sold his dairy herd, Arthur had enough capital to fund the new business and also a number of large barns and outbuildings suitable for manufacturing the kitchen units subject to refitting and planning consent being obtained. Lucy’s business plan was so convincing that Arthur decided to get out of farming altogether (by leasing his arable land to a local co-operative) and focus on developing the new business. From this small beginning grew the now publicly quoted company of Bellingham plc. Initially, showrooms were established in Beaconsfield and then Kensington. Demand for their kitchens was brisk and â€Å"Bellingham Bespoke Kitchens† expanded rapidly but remained a partnership. The firms clients are mainly celebrities from the entertainment world and the cost of a Bellingham Bespoke Kitchen is now ? 40,000 – ? 150,000 or more. The firm was restructured as a limited company in 1990 and subsequently experienced rapid growth until 1999. In that year the then directors decided that the business had reached the limit of development in it’s present form. Future development required large-scale expansion of production facilities in order to provide the range of materials, furniture, quality and prompt delivery required by their discerning clients. This in turn needed an injection of capital that the directors were unable to generate themselves. The conviction that there was much money to be made from â€Å"quality fitted kitchens† † had been vindicated. They investigated a number of possibilities deciding eventually to expand production facilities by purchasing a modern production unit on an industrial estate in Aylesbury. The expansion was funded by a stock market floatation and raising the necessary capital in the name of Bellingham plc. As the market grew and to keep abreast of new production technology, the directors agreed to reverse the maxim so dear to the heart of the founders, Arthur and Lucy; â€Å"neither a (long-term) borrower nor lender be. † They financed updating of equipment and premises by means of issuing debentures. It is now October 2012 and the present directors of Bellingham plc believe that the long-term success of the company lies in future international diversification and expansion. They consider that the most beneficial action they could take is to investigate the acquisition of a subsidiary in the USA. The newly-appointed finance director, Bill Moneypenny, agrees with this opinion but insists that the company must first appraise its own current position and if necessary, make changes to strengthen its existing financial situation before embarking on new plans. He is particularly concerned that the company should preserve adequate liquidity and finance its assets in a beneficial manner. He is also concerned that too much emphasis has been placed on â€Å"pandering to the whims of the rich and famous† and not enough on running an efficient business operation. Lucy and Arthur still retain 30% of Bellingham’s equity and other long-standing directors own a further 20%; a change of control is unlikely to be welcome. During the last two years, the company has updated it’s design, production and showroom assets and, in what has been a difficult year, has been able to maintain sales and profit growth (see Bellingham’s accounts in appendix 1). There has been a great deal of uncertainty about world economic growth and stock markets have been extremely volatile resulting low returns. However the firm’s ordinary shares have made good progress during the year. Ordinary share dividends have achieved substantial growth over the last two years although this rate of increase is not expected to continue. Ordinary dividends have grown at an average rate of 14% per annum over the past 10 years and this rate is a more realistic growth rate for future dividends. The present market prices for Bellingham’s shares and debentures are: ?1 Ordinary shares? 7. 02 ex div ?0. 50p, 6% Pref shares? . 55 ex div 7% Debentures 2016? 100. 51 ex interest Any new venture would be expected to achieve a return on capital employed in line with that experienced recently by Bellingham plc. The finance director favours a payback period of 5 years. Bellingham would therefore need to agree a realistic acquisition price for such a new venture and its future cash flows in order to determine whether these criteria could be met. Although a number of investment projects are being considered, the main proposal currently being investigated offers an expansion into the US prime-property market which is forecast to grow faster than the UK market. Bellingham’s finance director has already calculated the trends in the financial ratios of American Creations, an unquoted US company, from its unaudited annual accounts (see appendix 2) and has concluded that the proposal is now worthy of further investigation. American Creations is a family-owned venture requiring further capital to repair it’s balance sheet after making losses on a property development in Nevada from which it has now withdrawn. Profits have suffered in the last two years due to write-offs associated with this development. The existing owners feel that the firm’s future lies in establishing wider international links and the retirement of senior family members, leaving the younger members active in the management of the firm. They are therefore considering selling a controlling interest of 60% to a suitable company. The firm has been established for 23 years, and is well respected in business circles. The average age of its fixed tangible assets is 3 years. The directors have indicated that they may accept part payment in Bellingham shares subject to negotiation. The firm’s nominal share capital is $2. m, and the directors have indicated that they value the firm at five times the year 2010 net profit. They consider this to be the firm’s â€Å"normal† level of profit excluding the â€Å"extraordinary† effects of the Nevada development. As the firm is at present family owned and run, there is no available price/earnings ratio. P/E ratios for the only two publicly-owned c ompanies in the same business sector, Harvey Wilkinson Designs plc and Cucci Lifestyle plc, are currently 10 and 8 times respectively although both of these firms, unlike Bellingham, operate internationally. Wilkinson has grown at a similar rate to Bellingham. The dividend yields of these companies have been as follows: WilkinsonCucci Year to 31 December 2011 8. 1% 7. 25% 2010 7. 2% 6. 9% 2009 5. 3% 5. 95% American Creations has its own manufacturing facilities and operates throughout the USA and Caribbean with design offices in New York, Miami, Los Angeles and Colorado Springs. Their main business, which is thriving, involves complete home furnishing and interior design for wealthy clients. In addition, the firm has a real estate office in each location and is thus able to offer a complete property service. The value of properties handled by the real estate offices is typically $5m – $20m. Bellingham is interested not only in extending its operations internationally but particularly in the possibility of diversifying into the real estate business. Whilst well aware of the existence of a number of competitors, the directors feel that there is a ready market in the US for their established name in terms of design flair, service and products. After discussions with the directors of American Creations, Bill Moneypenny has produced the following forecast. Under average economic growth conditions, the American Creations operating forecasts (in $*1000) for the next five years are based on the following: Income:from Sales: $7500 in 2013, rising by 12% per annum for the foreseeable future. from real estate sales commissions: $2850 in 2013 increasing by 15% per annum for the foreseeable future. Manufacturing variable costs: Labour: $1250 in 2013, expected to increasing by 8% per annum. Materials: $3800 in 2013, expected to increasing by 5% per annum. Fixed costs excluding depreciation: Manufacturing O/H: $2065 in 2013, increasing by 5% per annum. General O/H: $1850 in 2013, increasing by 2% per annum. Depreciation:Factory, machinery vehicles: $500 per year. Office/Design Studio fixtures: $200 per year. The beta of Bellingham plc is believed to be 1. 65 , the risk-free rate of return is 5. 5% and the return for the last year on the FT All-share index is 2%. UK corporation tax is currently 32% payable 9 months after the end of the accounting year in question (you may assume for the purpose of this case that accounting profit and taxable profit are identical. ) Bellingham’s directors estimate that the after-tax profits of American Creations could be allocated as follows: 70% as retained earnings and 30% as dividends. This has been the pattern under the under the present ownership. There would be no restriction on the transfer of the appropriate share of these dividends to the UK. The US corporation tax rate applicable is 20% payable in the year in which the profit arises. There is no double taxation of profits of US origin in the UK. (For the purpose of this case, ignore the possibility of any withholding taxes and the effects of foreign exchange risk. It is considered possible that, as the US economy develops further, even higher wages than those forecast may be demanded by the workforce. Required: Evaluate the American Creations proposal on behalf of Bellingham plc, supporting your arguments with relevant theory and calculations and indicating any non-financial matters you feel should be taken into consideration. Your report should consider the following areas: 1. An analysis of Bellingham’s current position using relevant financial ratios. You should show the calculation of the ratios and provide interpretation of the results. . Calculation of Bellingham’s cost of capital, using alternative methods and arriving at the most appropriate figure. 3. An investment appraisal of the American Creations proposal assuming the valuation suggested in the case, using a variety of methods and evaluation of the results. 4. A sensitivity analysis of the proposal and interpretation of the results. 5. Calculation and discussion of alternative valuations for acquiring the share in American Creations and how these would impact on the investment appraisal. 6. A discussion of the various available methods of financing the acquisition and consideration of which is the most appropriate. Your calculations and arguments should be supported by relevant theory, with evidence of wide reading around the subject. You should provide a complete bibliography with appropriate referencing in your report. Submission requirements: Your answer should take the form of a written report of approximately 2500 words excluding appendices and the reference list. Deviations from the word count exceeding plus or minus 10% will attract a penalty of 5%. The hand-in deadline for submission is 23. 0 on 25th November 2012. Submissions up to 24 hours late will attract a 10% penalty whilst those beyond 24 hours but less than 1 week late will be capped at 40%. Reports submitted more than one week late will attract a mark of zero. Submit one electronic copy via Studynet. This is an individual assignment and the report submitted should be entirely your own work. Appendix 1:B ellingham plc| | | | | | | Abridged Trading, Profit Loss Account for the year ended 30th June 2012:| All amounts are in thousands of pounds sterling| | | | | | | | | | | | | | | | | | | 2012| | 2011| | 2010| | Sales| 9606| | 7564| | 6100| | Production Cost| 4034| | 3101| | 2240| | Gross Profit| 5572| | 4463| | 3860| | | | | | | | | Selling Expenses| 1467| | 1250| | 1080| | Installation Expenses| 1689| | 1300| | 980| | Administration Expenses| 960| | 630| | 597| | Operating Profit| 1456| | 1283| | 1203| | Debenture Interest| 53| | 53| | 53| | Profit Before Tax| 1403| | 1230| | 1150| | Corporation Tax| 449| | 394| | 368| | Profit After Tax| 954| | 836| | 782| | Dividends| 341| | 280| | 220| | Retained earnings| 613| | 556| | 562| | Balance Sheet at 30th June 2012:| | | | | | | | | | | | | Fixed Assets (net):| | | | | | | Land Buildings| 2300| | 2400| | 2500| | Plant Machinery| 1700| | 1186| | 552| | Fixtures Fittings| 700| | 600| | 402| | Motor Vehicles| 185| | 140| | 105| | Office equiptment| 250| | 185| | 100| | | 5135| | 4511| | 3659| | Current Assets:| | | | | | | Stocks: Raw Materials| 216| | 208| | 182| | Work in Progress| 200| | 205| | 190| | Finished Goods| 150| | 128| | 97| | Debtors| 1775| | 950| | 595| | Bank/Cash| 230| | 136| | 104| | | 2571| | 1627| | 1168| | Current Liabilities:| | | | | | | Trade Creditors| 1190| | 788| | 270| | Corporation Tax| 449| | 394| | 368| | Final Dividend| 171| | 140| | 110| | | 1810| | 1322| | 748| | | | | | | | | Net Current Assets| 761| | 305| | 420| | Net Assets| 5896| | 4816| | 4079| | | | | | | | | Long-term Liabilities:| | | | | | | 9% Debentures 2016| 750| | 750| | 750| | | | | | | | | | 5146| | 4066| | 3329| | | | | | | | | Shares reserves| | | | | | | ?1 ordinary shares| 1000| | 1000| | 1000| | 6% Preference shares of 50p ea,| 500| | 500| | 500| | Retained pr for yr| 613| | 556| | 562| | Profit loss| 3033| | 2010| | 1267| | Shareholders funds| 5146| | 4066| | 3329| |

Case 5 Ethics - Working Conditions Essay Example | Topics and Well Written Essays - 750 words

Case 5 Ethics - Working Conditions - Essay Example Jameson (2010, February 1) disagreed with this article in â€Å"Fed Up with Fat.† He asserted that fat people should be penalized for not actively addressing health issues, in the same way that smokers are paying more for their insurance because of their bad habit. This paper asks: Should an overweight employee who chooses not to participate in a wellness program be penalized? Using deontology and utilitarianism, it stresses that when a personal problem has widespread negative social consequences, then that person should be penalized for not participating in wellness programs, if healthcare assistance is free and other support systems are present. Deontology focuses on respecting people as ends, not as means to ends, and people have autonomy over their bodies, which society should not violate. Deontological thinking does not support stigmatizing people, especially because of physical differences (Morrison, 2009, p.403). Jameson (2010) talked about weight discrimination, which is immoral, because a person should be hired based on merit and other objective qualifications, not because of their weight. Tsai and Bessesen (2012) pointed out that many normal-weight people are actually unhealthy, such as smokers and those who are fond of eating fried, sweet, and salty foods, and yet are not gaining extra weight. They stressed that other fat people, on the contrary, are eating or living healthy, but they continue to have weight issues. This comparison highlights the injustice of being stigmatized because of being overweight. Furthermore, it is wrong to penalize people just because they are overweight, specifically people who are genetically predisposed to be overweight. Tsai and Bessesen (2012) mentioned that genetic studies prove that obesity has genetic causes, which is why some people get fat easily and have an unusually hard time losing weight. Some of them might even have illnesses that store fats in their bodies. Tsai and Bessesen (2012) stressed that socie ty will only be doing more harm than good, if it penalizes people who hardly have control over genetic predispositions. In addition, fat people are ends in themselves. They have autonomy, and they cannot be forced to apply in wellness programs, if they lack time and resources (Morrison, 2009, p.403). They might also have other issues, such as childcare, whereas if they spend time in these wellness programs, they have no money or no one to take care of their children. If these people are penalized despite these conditions, they are being seen as means to ends. The ends served are those of society, or the â€Å"thin† strata, who do not strive to understand the genetic, economic, and social conditions and limitations of the overweight. Fat people are people-as-ends too, and their autonomy over matters that concern their private bodies must be protected. Deontology further argues that the healthcare sector has a primary duty to do no harm to the obese. Healthcare professionals ha ve a duty to help the obese be aware of their options, in order for them to have a normal weight (Morrison, 2009, p.403). They must discuss prevention, not only cure, and suggest the best treatments and interventions to help the overweight deal with their weight problems (Morrison, 2009, p.403). The principle of beneficence is important. They must do no harm to the obese, and they can attain this if they provide the resources needed to help them (Morrison, 2009,

Market Entry into China (According to case study finish a Report) Essay

Market Entry into China (According to case study finish a Report) - Essay Example China becomes a hot favourite for investment in the sectors of cooperative enterprises, joint ventures. â€Å"According to Zhang (2005), the impact of the overseas Chinese on China’s FDI inflows can be seen at least in two ways. First, the overseas Chinese invest in China based on language and historical bonds; accordingly they possess advantages in operations in China. Second, the overseas Chinese act as a bridge through which foreign investors understand the Chinese culture.† (Devinney et al 2010). The country, however, did not allow solely foreign-owned ventures earlier, and they had limitation of technological support. This situation has now changed and through export from other countries they now have all the infrastructural facilities. China has now removed many limits, which were also different from their WTO promises and encouraged foreign-owned ventures to guide in higher technology and add to their export quantity. Thus, only foreign-owned enterprise under joint venture model is the most accepted structure of FDI in China. There are a mixture of FDI available in China and the most common among them have been the Equity Joint Venture, Co-operative Joint Venture, and, to rising quantity, completely Foreign Owned Enterprise. However, they have a viable system of legislation and ground rules for creating such ventures and suitable government approvals and business licenses are mandatory. Hong Kong and East Asia are the main sources of FDI in China. Presently Taiwan is also a major source of China’s FDI with increasing amount of investment. Taiwan positions as the second place of FDI in China. â€Å"During the past two years, the government has been working to reform the foreign investment approval system. The approval procedure for five categories of foreign investment has now been vastly simplified, as the central government has allocated significant approval power to its local counterparts.   For foreign investment projects with

National Labor Relation Act and Employee Rights Essay

National Labor Relation Act and Employee Rights - Essay Example The program will take two weeks of an intense training for the supervisors, during which the supervisors will be trained four hours every day, except for the weekends. Therefore, the training will constitute a ten-day training program, undertaken by the labor professionals and hired legal experts on employment from the labor department and other various professional labor organizations. At the end of the training, the supervisors will be required to undertake a test regarding the training, where only the ones who pass the test will be retained, while the ones who fail will be replaced. The program will also include a regular refresher course, undertaken once every 4 months for a three-day period, where the supervisors will refresh their knowledge on the duties, rights , freedoms and responsibilities of the employees and the employers, while also learning new developments in that area. Under the training program, several employee rights, freedoms, duties, and responsibilities will be covered, to equip the supervisors with the rightful knowledge about the rights of the employees, and, thus, to ensure that they do not interfere into such rights in the future. First, employees have the rights to attempt to form or to form a union in their workplace (Sack, 2010). Therefore, the supervisors will be trained to acknowledge the rights of the employees to establish unions within their workplaces, which will be used as a basis of championing for their rights, while also being as the bargaining vehicles for the employees, through which they can channel their grievances to the employers. The recognition of the fundamental right of the employees to form a union is in line with the basic human rights and the freedom of association and expressions, which no individual should be denied (Emerson, 2009). Therefore, through training the supervisors on the need to recognize and consequently respect the rights and freedoms of the employees to form and engage in union activities, the supervisors will cease to interfere with such freedoms of the employees, which will in turn serve to reduce the negative effects that the organization has felt, such as strikes and demonstrations. Additionally, by allowing the employees to engage in the formation of their own unions, they will be in a position to present their grievances to the employers or the relevant government agencies, which will, in turn, reduce the legal suits filed by the employees to the courts, which are detrimental to the organization, both in damaging its reputation, as well as causing it huge financial burdens (Dannin, 2006). The other fundamental aspect of the training for the supervisors, regarding the employee rights and freedoms, is the right of the employees to join and engage in the activities of a workers’ union, even if it is not recognized by the employer (Sack, 2010). This lesson will be very fundamental, since the employers can interfere with the rights of the employees to engage in u nion activities on the basis that such a union is not recognized by the employer. The fact that the employer does not recognize certain workers’ union does not limit the employee from joining such organizations. This fundamental

Corporate Social Responsibility and Globalisation Essay

Corporate Social Responsibility and Globalisation - Essay Example The discussion mainly focuses on the ethical principles underlying social responsibility in the business world. Ultimately, this essay argues that CSR becomes more and more important as globalisation rapidly develops. Confronting the growing environmental issues in the current global marketplace, MNCs are aggressively or constructively taking part in strategic programmes towards resource management and environmental preservation. Dedication of global businesses to sustainable initiatives are motivated by several internal and external factors, such as social activism, technological improvements encouraging sustainable programmes, customer demand for ecologically friendly goods and/or services, and governments’ environmental policies (Wilson 2000). Concerns about the corporate social responsibilities have been the point of contention for decades. However, recently, a new approach towards the issue has emerged and prevailed (Lechner & Boli 2004). Both in the corporate domain and beyond it, there is far-reaching and mounting advocacy for the existing idea of Corporate Social Responsibility (CSR). ... A particular explanation for this may be the perception that global corporations are not as impregnable as they were believed to be in the past; hence, their operations can be controlled to profit society (Wilson 2000). According to Bomann-Larsen and Wiggen (2004), another explanation could be a perception that successful legal regulation of businesses whose operations reach outside national boundaries is unlikely, making self-regulation as the sole realistic, feasible option. Thus, MNCs should self-regulate in a way that promotes the wellbeing of the society and its citizens. CSR has been controversial for decades, and some aspects of the subject matter have been introduced by ethicists. This controversy has been broadened recently to encompass the practices of MNCs. Even nowadays, the long-standing issue still reverberates through the halls of international corporations across the globe: â€Å"If it is legal, does that make it ethical?† (Manakkalathil & Rudolf 1995, 29) The emphasis of the word ‘ethics’ can be related to views concerning what is moral and what is not; one description of ethics may be the explanation of what comprises human wellbeing and the actions needed to support it. The concept of ‘ethical norms’ is brought into play to characterise compliance to generally accepted moral codes (Sullivan 2002). Consequently, according to Sims (2003), these moral codes are ruled mostly by values, traditions, and behaviour that a society implements as parameters for interpersonal manners. Hence, corporate social responsibility is tantamount to societal norms and values, which then implies that MNCs should formulate objectives that are congruent to

Is gambling a moral issue Essay Example | Topics and Well Written Essays - 1250 words

Is gambling a moral issue - Essay Example Although some of these arguments may be correct, gambling is more of a moral issue because it results in people’s suffering while others thrive. According to Fitzgerald there is no point in considering gambling and casinos as an economically viable industry. No doubt it adds to the pocket of a few and also contributes to the governments revenue box, yet considering the social maladies casinos and gambling are responsible for; it is more of a curse than blessing. Furthermore a healthy society can thrive amidst healthy individuals. Here health does not only refer to physical health but also the psychological one. Gambling results in erratic behavior through a complex neurochemical reaction that is far from being healthy and therefore according to Fitzgerald should be abstained from. Last but not the least the writer has also criticized gambling and casinos for spreading pollution and congestion in weekends through the rush of gamblers in peaceful localities where casinos are loc ated. Fitzgerald states at first that gambling although illegal in the state of California, in recent time permission has been extended to some Indian tribes. Might be placed in a light note but according to him since from historical times the Indians have been exploited by the other Americans the state now want to compensate them by conferring right of exploiting the others. United States of America as a uniform country must follow the same law for all and the logic that the writer has presented in legalizing gambling is no short of disgracing the goodwill of the government and the equality doctrine of the constitution. Without any grain of doubt the writer is against legalizing gambling but his arguments against such legalization are all driven on materialistic grounds. Fitzgerald has referred that gambling can never be considered as an economic boost owing to the $2 net loss it imposes on the government for each dollar earned as revenue. Another economic argument placed by the wr iter is the doubling of bankruptcy rate in countries with casinos in compare to those without them. The writer carefully states statistics to act as a psychologist while judging the compulsion of a gambler to spend more than he can afford. The statistics according to Fitzgerald in favor of such compulsion is quite high at 43%. Apart from economic and psychological reasons another aspect that Fitzgerald has referred to is the environmental aspect of gambling or casinos. The economic aspect that Fitzgerald has cited against gambling holds quite a ground. However quantifying the qualitative variables and indicators often stirs much debate. Owing to this fact it is hard to tell that whether the exact number that the writer has cited as a burden on revenue owing to gambling is appropriate. Another study amidst a different surrounding might have yielded a different result. Furthermore the modern day economics is a social science and much more beyond monetary value exists in a society that economic consideration must take into account. The psychological cost that gambling imposes on an individual in terms of erratic behavior and addiction might well receive a counter attack from those who support gambling and considers it as a means to joy. Gambling is based upon probability and neither the cost of loosing nor the profit from winning is assured. A

Phase 2 Individual Project Assignment Example | Topics and Well Written Essays - 2000 words

Phase 2 Individual Project - Assignment Example The primary objective of this case study is (a) to define fixed, variable, and mixed costs; (b) to determine cost behaviour patterns, and (c) to explain how these different patterns affect operating and pricing decisions. II.Cost Analysis a. Definition of Variable Costs + Example All expenses incurred that increase as the Production Output and Sales increases and decreases whenever the Production Output and Sales decreases should be considered as variable costs. Albrecht, Steve W., et.al.(2010, p.1062) defined variable costs in a more general way by saying that they are the costs that change in total in direct proportion to changes in activity level.. In the SAC operations, an example of the variable cost would be Raw Materials. The higher the demand for the product which would be evident in the increase in Sales volume, the higher the required Production Output, and a corresponding set of Raw Materials will be needed to produce the desired order quantity. b. Definition of Fixed Cost s + Example All expenses that are incurred whether or not operations are at high or low level should be called Fixed Costs. Rich, J.S., et. al. (2009, p.757) defined fixed cost as constant costs â€Å"within the relevant range as the level of of output increases or decreases.† At SAC, an example of that fixed cost is Depreciation Expense – Factory. Each month, whether or not the factory produces for high demand or for low demand, the value of depreciation expense will not change. c. Definition of Mixed Costs + Example Some costs known as mixed costs are made up of a combination of fixed cost and variable cost. Weygandt, J.J. et.al. (2009, p.209) teaches the need to separate these two in order to properly perform a cost-volume-profit analysis. Kinney, M.R. and Raiborn, C.A. (2012, p.70) also refers to the â€Å"high-low method† of determinine variable costs per unit and then separating it from fixed costs. That is, the formula to determine the portion that is var iable in a mixed costshould be as follows: Cost at High Level of Operations less Cost at Low Level Operations divided by High Activity Level expressed in volume of production or sales less Low Activity Level also expressed in volume of production or sales. The result will be the variable cost per unit within that mixed cost. Variable Costs may then be computed for its total and then separated from the total mixed cost in order to arrive at the fixed cost total within the mixed cost. In the case of SAC, there are data from two years, 2005 and 2006. Cost of Goods sold in 2005 was 50.81% whereas in 2006, the percentage increased to 59.30%. This means Cost of Goods Sold (CGS) may not be considered as 100% variable costs. A closer look at the details of CGS in the 2006 journal entries shows the following accounts: Cost of Goods Sold Raw Materials Labor Overhead Classification: Fixed, Variable, Mixed Supplies-Factory 3,500 MC Insurance-Factory 800 FC Indirect Labor 16,000 MC Factory Salar ies 12,500 FC Factory Property Tax 7,500 FC Maintenance Expense- Factory 8,700 FC Depreciation Expense-Factory 1,600 FC Utilities- Factory 3,650 MC Raw Materials RM, beg.=19,360 Purchases=33,710 RM, end= 10,000 RM, used 43,070 WIP, beg.= 1,800 RM processed = 41,270 WIP,end= 7,000 FG added=34,270 FG,beg.= 25,360 FG,total= 59,630 FG,end= 36,360 FG,sold= 23,270 VC Direct Labor 8,500 VC Selling Expenses 1,560 MC Admin.