Maslow’s theory Essay Example for Free

Maslow’s theory Essay There is an interrelationship between Maslow’s theory and Herzberg’s theory. These two theories have a similarity in that both of them suggest employee satisfaction as a motivation factor. Form the above discussion, it is possible to tell that Herzberg cites esteem needs and self-actualization needs from Maslow’s theory as the motivators. Others needs do not cause motivation and failure to address them in the organization setting only leads to dissatisfaction. Criticisms Maslow’s theory Several criticisms exist about Maslow’s motivation theory. To begin with, there is limited scientific evidence if any to support the above theory. Furthermore, personal need priorities may not be in the order given by Maslow. For example, there is a possibility of social needs coming before security needs since one must belong to a society in the first place. Another criticism is that people do not necessarily satisfy each level of need at a time. Needs tend to conflict such that a person may be motivated to achieve different needs at the same time or make priorities depending on the urgency of each need. Maslow’s theory is therefore general and does not consider individual differences. Herzberg’s theory Herzberg’s theory does not also consider individual differences when analyzing factors that cause satisfaction and those that cause dissatisfaction. One dissatisfaction factor may be a motivator for someone else and vise versa. For example, increased responsibility could be a dissatisfier for someone who is resistant to change. Again Hertzber’s model is too simplistic and only addresses factors that people would consider normal motivational factors in any workplace setting. Describe goal setting theory. Explain how this theory can be applied to performance appraisal and compensation This is a motivational theory developed by Edwin Locke. It is actually an improvement of the final causality theory advanced by Aristotle which put forth that purpose can lead to action. According to Locke, an individual’s behavior is to a large extent influenced by their ambitions and goals (Latham and Locke, 2002). For this reason, goals significantly improve performance. Most individuals set goals in anticipation for something; usually a reward to be obtained after achieving the set goal. Goals can be said to affect performance in three different ways (Latham and Locke, 2002). Firstly, they narrow an individual’s attention so that all efforts are directed towards activities that are relevant to achieving the set goals. Similarly, irrelevant or undesirable activities are avoided. Secondly, goals increase effort as individuals strive to achieve the set goal so as to gain the expected reward. Thirdly, goals help individuals to develop persistence. In other words, they become more willing to work even in the midst of challenges and setbacks. Goal setting is guided by factors known as moderators (Latham and Locke, 2002). These include goal –commitment, attainability and self-efficacy. In order to attain a certain goal, an individual must be ready to face every challenge that he or she finds on the way. Commitment depicts the need to achieve no matter what the circumstances. Set goals must also be attainable so that individuals must not set goals that cannot be reached. Finally, self-efficacy must be present for goals to be achieved. This refers to the ability to act in a certain way so as to be able to achieve set objectives.

Roles of a financial manager

Roles of a financial manager Introduction Of The History Of The Function And Qualifications Of A Financial Manager First we need to understand the term ‘financial manager, Brealey, Myers and Allen (2008, p.6) referred this term to anyone in an organization who is specialized in finance and responsible for the companys investment or financing decision, large corporation may name it as ‘controller, international conglomerates even appoint a Corporate Financial Officer [CFO] to be responsible for corporate planning. History Of The Financial Managers Function Ever since 1900s and even after the Great Depression in 1930s, the primary role of a finance people was only a descriptive discipline on bookkeeping which means accurately recording all transactions related to the payment of suppliers, billing of customers, and handling of cash passing through the accounts department and issuing periodic financial statements. Until late 1960s increased competition in industries forced financial managers to shift their focus towards evaluating investment opportunities and making decisions on the choice of assets and liabilities necessary to maximize the companys value. The 1970s and 80s was a period of increased international competition, CEOs became concerned with operational efficiency to cope with the fast growing market, this included the accounting functions which was streamlined and required to reach out to becoming a profit center for the whole organization (Besley Brigham, 2005, p.6). This transitional shift was gradual and finance managers r oles are no longer stuck solely to the accounting functions, hence a new operational trend brought in a new breed of heavily educated controllers profession with MIS training and computer systems operational capabilities to bring forth efficiency and accuracy in management reports and analysis versus the old accounting systems. Olley (2006) quoted a study by the Institute of Management Accountants (IMA) [The Practice Analysis of Management Accounting (1996)] which mentioned that since the mid 1980s, management accountants have transitioned from the traditional role of being a ‘number cruncher to an internal management consultant and decision-support specialist. Over the century, finance manager has risen to a highly educated, professional and useful positions in the entire corporate structure. Qualification Requirements Of A Financial Manager [FM] In normal practice, a finance manager has to have ACCA/ HKICPA or degree in accountancy or financial planning academic track record or even a chartered accountant qualification, who may possess a minimum of 10 years experience in accounting and financial planning. The traditional career path towards a Financial Manager was through the accounting clerical ranks, then move onto being an assistant accountant and accountant. Other recruiters would prefer one who has been an auditor as this experience allows the individual a wide exposure to auditing and learning from different industries, knowledge of financial situations and how to avoid human or systems errors, so that the person is more affluent on how to manage a smooth transaction flow. Expectations From Corporations, Job Description And Key Attributes Of FM Expectations From Corporations The functions, levels and scopes of responsibilities of financial managers can be very different depending on the size of organizations. For large corporations, the generic role is highly focused on strategic analysis while for smaller organizations, the role could only be more concerned on the collection and preparation of accounts and ledgers. Michael Page International, one of the worlds executive recruitment agent, posted a front page headline advertisement in Classified Post of South China Morning Post on 14 November 2009 in the need of a Chief Financial Manager. The advertisement stated the incumbent will be an integral part of the senior management team, report to the Managing Director [MD] with the ultimate responsibility for the control of the global finance operation of a new venture. The person will need to manage the cash situation of each branch of the business and exercise the financial strategy across multiple locations and will need to build the necessary reporting, risk and control frameworks. The person also needs to prepare analysis and financial models and ensure compliance to corporate policy and national accounting practices. In addition to technical finance advice, the incumbent should possess strong commercial acumen and will work closely with the MD on strategic growth and development plans for the b usiness, furthermore, to liaise with shareholders, key investors and build relevant banking relationships. The client expected someone with experience working within an entrepreneurial environment and display the ability to be part of a dynamic team. Allicolven, another executive search consultant, listed the criteria on its advertisement in JobsDB (13 November 2009) that the applicant has to provide value-added insight into opportunities and risks, responsible for completing the statutory consolidated financial audit for the organization, as well as ensuring the impeccable application of global accounting policy issues for the company and its subsidiaries, the development and maintenance of global controls surrounding treasury and cash management. The client required from the incumbent excellent leadership, proven understanding of regulatory capital issues and align with regulators, excellent communication and command of English and Chinese. These advertisements include all the criteria this paper aims to discuss on and one can easily see the challenging roles of a finance manager nowadays which exceeds the normal accounting functions already. Job Description Of FM Typical work activities, stated in the Job Description of a Financial Manager in JobsDB (9 Nov 2009), Prospects (16 Dec 2009), and Careerplanner (16 Dec 2009) are summarized below, with each requirement stating clearly a standard that has to be met and how the results of the good work would impact the organization: Manage and oversee the daily accounting functions to ensure relevant accounting activities are handled in compliance with the regulatory requirements and group accounting policies and maintain the highest standard; Coordinate and execute all financial related activities in the groups businesses to ensure the proper financial management and minimize the financial risks; Assist the top management to formulate strategic and long-term business plans; Monitor and supervise the month-end closing to ensure all management reports are tendered on time and with accuracy; Prepare and review monthly financial charts for all offices, debrief the financial data and results into business implication to relevant divisional heads; Compile various periodic analytical reports and hold discussion meetings with department heads timely to alert them of the updated business performance; Liaise with external auditors to ensure annual auditing is performed smoothly; participate in the group internal audits to ensure proper control procedures are in place; Monitor cash flows, oversee the total funding, predict future trends of cash and fund management to optimize the benefits of the companys fund usage; Establish the annual budget program and financial models to sustain a smooth and comprehensive process; Handle taxation and legal matters; Review and implement efficient and effective internal control system, make recom- mendations on existing work procedures to improve efficiency. Set up accounting software to ensure it meets the corporate accounting requirement; Supervise the accounting staff locally and ensure the accounts department is well managed, liaise with overseas accounting heads to make sure appropriate guidance and directions are given. Assist in appropriate recruitment and provide coaching and training programs to staff members and conduct performance review for them; Work independently, when applicable, take the initiative to provide input on process improvements as it relates to reconciliations; Develop network and relationships with community and external contacts, such as customers, auditors, solicitors, bankers, brokers, creditors, insurance companies and statutory organizations. Provide assistance and solutions to them whenever necessary; Analyze and keep updated of changes in legislation, financial regulations, competitors move and market trends, research and report on factors influencing the organizations business performance and advise the management accordingly. The Key Attributes And Competencies Required For FM It is almost a prerequisite for a professional finance manager to be analytical, rational, cautious and meticulous yet possessing a macro view of the whole accounting picture, ethical, risk sensitive and inquisitive to detect fraud in any areas in the organization. General personal attributes such as being hardworking, independent with initiative, responsible and accountable, well organized, efficient, timely, cost-effective, self motivating, willing to work under pressure are expected. In addition, management skills to enhance productivity of the accounting team, interpersonal skills in proactively communicating the financial facts and findings to the management, coordinating with other department personnel and decision makers, and being a team player would be most appropriate and eligible to be a finance team leader. Typical Accounting Roles Of Financial Managers And The Critical Aspects Gitman (1992, p.8) defined that financial management is in the arena of business management, dedecated to a careful selection of sources and prudent use of capital, with the aim in enabling a spending unit to move towards the direction of reaching its goals. The duties and responsibilities of financial managers vary with their specific functions and position titles in different organizations, this includes being a controller, treasurer, credit manager, cash manager, internal auditor, taxation manager, risk and insurance manager. Each of these functions has their critical aspects and prime objectives. Function As A Controller Controllers direct and compile the preparation of financial analysis reports concluding and forecasting the organizations financial status. These analyses include income statements, balance sheets, continual review of revenue and expense trends and analysis of future earnings. Controllers provide periodic compilation of business cycle forecasting statistics and periodic calculation of a standard set of ratios for corporate financial performance and regulatory authorities. Controllers make financing decisions typically including should the company raise funds by borrowing short term or long term debt or by selling stock and equity, timing to pay dividends and timing to sell the debt and equity. The long range plan should include a listing of capital investments required and calculate the economic benefits to attain the revenue and profit objectives. Brigham Ehrhardt (2002, p.502) mentioned clearly that effective capital budgeting and funding allocation including cash management, budg eting, sourcing and requirement can improve both the timing and quality of asset acquisitions, all of these decisions affect the investment profile of the company hence impact the shareholders value. It is common that controllers oversee the accounting, audit and budgeting, logistics departments and are responsible to communicate any financial variances and adverse trend results to management, along with recommendations for improvement. With regards to budgeting, Mason (2007, pp.121-123) briefed that a controller should determine various budgets on sales and revenue, revenue expenditure, profit and loss, capital expenditure and cash budgeting. The prime purpose of budgetary control is to maintain expenses to be spent within the limits of income. As the budget is set, a controller must control costs and management overheads and allocate the costs accordingly. Figure 1.0 illustrated basic elements of management overheads, listing clearly actual expenses versus the budget assigned. Function As A Treasurer Treasurers are responsible to oversee the organization cash, execute capital-raising strategies to support expansion of the company. Basically, as Brealey et al. (2008, p.6) mentioned, treasurers look after the investment of funds and manage associated risks, supervise cash management and deal with merging and acquisition activities. To ensure tasks to be properly processed, they need to maintain relationships with bankers, stockholder and other investors holding the companys securities. An example of Allied Air Products, given by Besley Brigham (2005, pp.690-691) which issued different classes of securities because the finance team was aware that different investors had different risk and return trade off preferences, so to appeal to the broadest possible market, Allied offered securities to attract as many different types of investors as possible. Besides, different securities are more popular at different points in time, the company can issue whatever is popular at the time they need money. A wise strategy that takes advantage of market conditions can lower a companys overall cost of capital. Function As A Credit Manager Credit managers have to tailor make credit agreements that concerns the indebtedness limits, evaluate the credit applicants, ensure that the company maintains a fixed amount of working capital to cover the companys operating cash needs. Primarily, they monitor the companys issuance of credit, develop credit rating criteria and determine the ceilings, establish an accounting system for the sake of banking transactions (Van Horne, 2002, pp.449-459). Furthermore, they are responsible to review the collection reports, status of outstanding balances, then arrange to collect debts of past-due accounts or submit the delinquent accounts to solicitors or outsourced agencies for collection. This role ensures the company to have valid funds for the operation and arrange new sources of finance for a companys debt facilities. Function As A Cash Manager Cash managers monitor and control the flow of cash, control check stock, signature plates, separate the responsibility for the cash receipts and bank reconciliation functions, process all accounts payable and receivables, and cash application transactions in accordance with rigidly defined procedures. Petty cash authorization and usage is to be supervised, recording incoming cash payments and verify amount of cash discounts taken. All above measures have to be scrutinized to ensure proper cash in-flow record and usage to meet the business and investment needs of the company and avoiding the risk of committing fraud if the operations are not monitored well. Least to mention, cash flow projections are required so that the management needs to determine if external loans are needed to meet the cash requirements or if surplus cash can be invested in other interest-bearing instruments. Cost accounting and Inventory accounting is another major role of Cash Managers, they need to conduct job or process costing and verify the inventory valuation, because inventories form a link between production and sale of products. Van Horne (2002, p.463-465) explained that cash managers measure the benefits of inventory versus the cost, like account receivables, inventories hedging should be increased as long as the resulting savings exceed the total cost of holding the added inventory. Other than paper work, cash managers have to coordinate periodic physical inventory counts, audits and allocation methods, and provide periodic compilation and evaluation of the inventory costs. Function As An Internal Auditor And Coordinator With External Auditors The scheduling and management of periodic audits within the company lies upon the shoulder of the Internal Auditor. The preparation of audit reports and communicating the findings and recommendations to the management and board of directors is essential. Without saying, they are responsible to assist the annual external auditing. Auditing for fraud especially for small scale transactional fraud is difficult, so by observing the environment, the managing persons accountabilities and employee lifestyles may help in detecting unnoticeable fraudulent act. American and European based corporations have their own internal auditors who perform ad hoc auditing within the corporation worldwide at least once or twice a year. Function As A Tax Manager The reporting requirements of all governmental authorities have increased significantly and become more complex, so it becomes mandatory that companies comply with the changing federal and local tax laws and regulations. Tax managers handle the tax filing and reports for the organization so they must be familiar with tax laws and report timely to the Inland Revenue and tax authorities. Profound knowledge of and experience in international business and personal tax laws will help in this role although company may hire external tax consultant or tax attorneys. Tax managers should review the annual and strategic plans to develop the tax jurisdiction and liabilities for each period, develop tax shelter policies, research the foreign tax consequences of the business plan, recommend actions concerning all tax adjustments and at times, defend the company in respect to disputed tax matters. Eun Resnick (2001, pp.475-486) recommended some measures to be taken by tax managers, such as acceler ating deductions which involve depreciation, making use of local and foreign countries tax credits, avoiding non-allowable expenses, increasing tax deferrals and obtaining tax exempt income to use the excess tax savings in other forms of investment. It is critical that the application of tax laws must be considered in many day-to-day operating decisions, setting up business operations overseas, utilize tax havens, consider personal tax situation when hiring expatriates which will help to avoid paying excess taxes by the company or individuals. Function As A Risk And Insurance Manager And Liquidity Crisis Manager Risk and insurance managers oversee the operations, projects and production programs to minimize risks and losses that may arise from financial transactions and business operations. They need to manage the insurance budget, analyze and measure risks of the investments, direct operations of brokerage firm which were commissioned in buying and selling securities, insurance negotiations, and finally select the insurance brokers and carriers. Establishing procedures for custody and control of assets, records, loan collateral, and securities, review reports of securities transactions and price lists is critical to ensure safekeeping and analyzing the market conditions. Rowe et al. (1994, pp.383-386) suggested risk managers to work on the capital cost overruns, nationalization of facilities as some countries may nationalize certain industries with little or no compensation to the previous owners, ecological costs notably in the asbestos and tobacco industries, sales fluctuations, market gr owth rate, companys market share, investment required, cost of production, raw material scarcity, deterioration of margins for competing products, and technological advances. They would identify the key variables that have impact on the business decision, after all, a long range plan should include an in-depth assessment of the risks that may occur as a result of the business plan. If impending problems are predicted, company can avoid going into involuntary liquidation. Functions Specifically Required In Financial Institutions Financial managers who serve in financial institutions, such as commercial and investment banks, finance associations and credit unions, oversee a variety of functions, including loans, trusts, mortgages, futures, lines of credit and investments. They must be highly familiar and operate in compliance with the State laws and investment regulatory rules and always keep abreast of the fast growing array of financial services and products. Arnold (2005, p.627) suggested that managers have to evaluate and examine application, approve or reject, lines of credit and commercial, real estate and personal loans, they also need to be aware of, and assess the international risk that arises due to foreign currency exchange rates and inflation rates, economical and political situations which may impact the local and foreign countries bonds requisition. Liability Responsibility Financial manager, regardless of the functions above, should monitor the accruals, take a standard review of customer advances in the closing procedure if the company regularly deals with a large amount of customer deposits. They should plan the current and long-term liabilities, such as accrual for bonuses, commissions, property and income taxes, royalties, unpaid wages and vacation pay, warranty claims, by period, in addition, they can analyze each way to reduce the companys obligation such as using just-in-time inventory methods to reduce accounts payable and arrange for a good payment terms for product or materials purchase and update the projected debt status to the year-end closing (Spiceland et al., 2009, p.358). A cautious procedure and alertness will assist the companys growth with little draw back. Organizational And Strategic Roles Of A Financial Manager As computerized systems are unanimously used in corporations, so finance managers can utilize more time in establishing strategies and implementing the short and long term goals for their corporations. As Part Of Management With Management Skills A Financial Managers function can be very distinct and like any other department manager, a finance manager needs to have general management skills such as A) Planning on what work is to be done and the completion schedule in the accounting department, especially in the timely processing of transactions and guiding the budgeting process; B) Organizing the financial tasks, office management, and software, hardware utilization; C) Directing the department work to ensure it operates in an orderly manner; D) Measuring the performance of all key aspects of the department to ensure that performance meets or even exceeds the standards set; E) Delegating work to accounting subordinates and F) Process controlling and constant reviewing if assignments are completed with accuracy and within the time frame; F) A finance manager must have a good knowledge of both company and industry operations in order to know how they impact the operations and new strategic move of the organization. As A Strategic Business Partner Any business decision, in particular the crucial strategic move, cannot dart ahead if without assessing the financial implications. This extends the domain of a finance manager to be involved in strategic business management. To compete successfully, a company must analyze its cost position relative to that of competitors, finance manager will play a strategic role here to provide competitive-cost analysis, if all competitors costs are researched, the company can project future price levels, anticipate competitors moves, prepare countermoves, and assess the potential of its strategies for success. Van Horne (2002, p.199-200) interpreted competitive-cost analysis begins with an analysis of strategic cost-driving factors which determine a companys relative long-run position. The initial question is to determine which costs are relevant in a strategic sense, should the company ‘do the things right by cutting costs in the short run or ‘doing the right things to position the o rganization for long term cost advantages by exploiting opportunities for excess returns. Rowe et al. (1994) had a good insight by raising a number of questions while revealing the financial analysis, the manager should ask if the new strategy is appropriate given the companys current financial position in the industry, do we have the financial resources to initiate the strategy, are financial resources being allocated correctly in order to achieve the strategic goal, should acquisitions be considered, should outsourcing be considered. Finance manager can help in companys growth by determining a wise use of the strategic funds (which is total funds available minus the baseline funds) for purchase of new tangible assets such as facilities, equipment, and inventory, to increase working capital, and to fund direct expenses for research and development, marketing, advertising and promotions and even for mergers and acquisitions. As Corporate Policies Writer And Evaluator Being cautious and versatile in the financial principles and discipline, knowing a thoughtful planning would affect the strategies of the company, finance manager should initiate the details of all procedures, the authorization and limitations of peoples act, regardless such act is aggressive or ignorant, into written polices and procedures. Such policies can include the operation of the accounting systems and statements issuance, the inventory purchase and control, capital and asset investments, human resources compensation plans and expenses, capital evaluation and auditing control measures must be enacted into a procedural manual for all divisional managers to follow suit. Besides, authorization and procedures of credit and collection policies, dividend polices with regards to the dividend amount and payout timing must be thoroughly documented and regulated because rightful process allow less human error or falsified ethics, avoid paying excess tax which would overall influence th e level of a companys accounts receivable. A good policy and practices impact the quality of the trade accounts, increase the companys branding and competitive edge in the market. Handle Mergers And Acquisitions And Consolidations Financial managers have an essential function in mergers and consolidations, in global expansion and related financing. The primary motive and purpose of merging two companies is to increase the value of the combined enterprise. Say if company A and company B merge to form a company C, and if Cs value exceeds that of A and B separately, then synergy exists and such merger should be beneficial to both As and Bs shareholders. A recent headline is Bank of Americas [BA] 2008 acquisition of Merrill Lynch which made BA the worlds largest wealth manager. Both Brealey (2008, p. 883) and Brigham Ehrhardt (2002, p.970) cited on the same record breaking example of AOL spending a significant amount of USD156 billion in acquiring Time Warner, aimed to create a company which offer consumers a comprehensive package of media and information products. Financial managers possess extensive and special knowledge in the areas of risks reduction, valuing the targeted firm, compliance of merger regulation s, international foreign exchange, tax considerations, analysis of the companys current surplus funds, merger analysis of benefits of the complementary resources of income, and last of all provide a post-merger report. Without the merger analysis by financial managers, these merger and acquisitions and consolidation in the market would not have been active worldwide, especially in the USA. Maximize Shareholders Value A competent finance manager should act in the interests of the companys owners and shareholders, maximize current wealth and profit of the organization by increasing the companys market value. To do so, monitoring the equity of the organization in terms of debt and credit is important, because investors expect a high return on the capital invested in terms of dividends, minimized liabilities and a maximized stock price. Brealey et al. (2008, p.22) explained that the real assets of the organization need to produce sufficient cash to satisfy bankers debt, so the capital budgeting responsibility of the finance manager plays an important role to calculate how much money the company can invest and into what kind of assets that could be predicted to earn the most and fastest, and diffuse all concerned risks. This measure is to ensure enough flow of money from investors into the company is well utilized and then maximize the return back to them to satisfy the shareholders. Summary With any and all of above accounting and organizational functions that Financial Managers have to perform and fulfill, it is almost imperative that they should take the initiative to advise, make recommendations for improvement to the management on all financial related matters. Acting as a counselor and invigilator of senior management is critical and affect the survival of the company. Prince (2005, p.15) quoted an example on the CEO of Kmart who exercised extensive high spending manners, extravagances and received excessive executive compensation in the cost of the corporation finally led to the bankruptcy of the company in January 2002, now became a subsidiary of Sears Holdings Corporation. Likewise, General Motors Company [GM] which was ranked as the largest US automaker, filed for liquidation in June 2009, finally assisted by US â€Å"Governments Troubled Relief Program and commenced its reorganization since July 2009. On the other hand, the low resource utilization manner of Murdoch (Prince 2005, p.15) was advised to use the high value assets to offset News Corporations debt, eventually, the company was spared liquidation due to the financial approach. Nowadays Financial Manager Versus Traditional Accounting Manager And The Challenges Accompanied With This Role There is a growing realization that a Financial Manager is no longer called on only to process accounting transactions and issue financial statements when these tasks require detailed technical knowledge but no considerable management or analysis skill. Instead, the modern finance manager or controller must exhibit additional mastery of a multitude of management skills, so that the accounts department runs in an efficient and effective manner, offers a detailed analysis of financial statement results, recommends improvements, and monitors the activities of other departments and perhaps even manages the computer systems in a smaller organization. They should no longer focus on the paper driven reports, so modern finance managers need to radically change the finance report styles and to be efficiently generated by the computerized systems. Financial managers need to cope with the competitive advantage, add values to the corporation, and advance into the use of electronic spreadsheets for financial analysis, target costing, disaster recovery planning, fraud prevention plan, inventory valuation, activity-based costing and budgeting, outsourcing information systems security and software package integration. Nowadays finance managers should utilize the analyzed information to strategize plans to maximize profits and act as business advisors to top management. Global Expansion And International Financial Management Globalization is a trend where business enterprise can search for lower production and labor costs complemented with high quality merchandise and production efficiency, companies may have a need to broaden the markets, seek for raw materials and new technology. Kim Kim (2006, p.4) defined globalization means integrating the world marketplace and creating a â€Å"borderless world† for goods and services. In the era of heightened global competition, international finance managers have to be a strategic partner by starting off to consider the external environment in terms of economic situation, the current and future stage of the business cycle, entrance of the new competitors, political

Benefits Of Mangroves Forests Environmental Sciences Essay

Benefits Of Mangroves Forests Environmental Sciences Essay The general distribution of mangrove forests are in both tropical and sub-tropical parts of the world with them only being found at latitudes of 25oN and 25oS of the equator and in as high latitudes as 32 oC which is in 117 countries (Barbier Cox 2003) where the sea surface temperature does not get lower then 16oC because they cannot withstand freezing temperatures. According to literature, it is estimated that 75% of the worlds mangrove forests are found in 15 countries (Giri, et al 2011). The proportions of mangrove forests found throughout the world are as follows (Giri et al 2011): Asia: 42% Africa: 21% North/Central America: 15% Oceana: 12% South America: 11% Mangrove forests inhabit tidal areas which include estuaries which receive a somewhat indirect tidal influence and marine shorelines which receive direct tidal influences. The forest is flushed by seawater which is brought in by high tide that inundates the forest floor for an extended period each day and at low tides the water recedes. Due to evapouration, the soil salinity becomes concentrated and raises to high levels (NOAA 2010). Benefits of mangrove forests According to Ronnback (1999) some of the products that can be had from mangrove forests are as follows: Fuel which includes firewood, charcoal and alcohol Construction material such as timber for scaffolds and heavy construction, Beams, poles, flooring, panelling, etc. Fishing: poles for fish traps, fish attracting shelters, fishing floats, fish poison and tannins for net and line preservation Food and beverages: fish, Crustaceans, Molluscs and Other fauna. Vegetables from propagules, fruit and leaves, Tea substitutes,Alcohol,Vinegar and Fermented drinks Household items: Furniture,Glue,Wax,Household utensils, Incense and Matchsticks Textiles and leather: Fur, skins, Synthetic fibres (e.g. rayon),Dye for cloth and Tannins for leather preservation Other products very useful products that can be harvested from mangrove forests are: Fish, shellfish and mangrove roots for aquarium trade Medicines from bark, leaves, fruits and seeds Fodder for cattle, goats and camels Fertilisers Lime Paper Raw material for handicraft Cigarette wrappers Ecosystems services obtain from the mangrove resource are as follows (Ronnback 1999): Acts as a natural sea defence Provides biophysical support for coastal ecosystems Provides biological regulation of ecosystem processes and functions Production of oxygen It functions as a carbon sink so it will have an impact on local and global climate It sustains the livelihood of global communities Heritage, cultural, spiritual and religious values Educational and scientific information Recreation and tourism Statement of the Problem In the years gone by mangrove forests were being increasingly destroyed by persons that are seeking a livelihood or just see the mangroves as a cheap and readily available fuel source. This leads to each one of these so called users to try to exploit this resource to their maximum benefit and cannot be prevented from doing so (free rider problem) because this resource is what we call common property which further contributes to the destruction and degradation of mangroves since there is no defined ownership or responsibilities towards the resource. In recent years many countries especially developing countries have begun to increase their economic activity in pursuit of development from which the pollution negatively affect the mangroves either directly or indirectly. Causes of mangrove degradation and destruction Negative Externalities Firstly, we know that a negative externality occurs when an individual, a group or firm makes a decision that only makes consideration for direct costs of production and not the costs of pollution caused by the consumption of the good and services produced i.e. they make a decision to produce certain goods and services which negatively affect third parties and the environment in the form of pollution whether it be air, water, etc. This pollution in some cases are unregulated which causes market inefficiency because the cost of pollution cause by the consumption of goods and services will not be reflected in the market price proposed (Helbling 2012). In the case of mangroves, there are a number of activities produce negative externalities that affect this ecosystem and cause extensive degradation and destruction. Some of the main ones are as follows (Kathiresan 2012): Agricultural expansion and encroachment e.g. vast expansion of aquaculture farms that produce shrimp in countries such as Honduras, Thailand, Bangladesh, Sri Lanka, et cetera. This is also a result of increase population growth and the demand for food which requires more land to keep up with this demand so in essence its land scarcity that causes the encroachment into the mangrove forests and the land to be converted. Urbanization e.g. in Haiti mangrove mudflats are being cleared to build homes Cutting for timber, fuel and charcoal e.g. in Haiti vast areas of mangrove forests are decertified by poor farmers desperately trying to making a living from charcoal making Prevention of freshwater flow and tidal flow e.g. in Guyana when the Berbice River Bridge was first constructed, it cut off some of the tidal flow of water to a section of the mangrove forest through which it passes which caused part of the forest to start dying off Pollution e.g. in Guyana haphazardly disposed plastic bottles used in the beverage industry end up in the drains and make the way out into the sea and are washed back up on shore and are trapped in the mangrove forests where they accumulate to very large amounts and cause extensive pollution This negative externality problem can also be as a result of unallocated property rights (Schenk 2002). Even Though the mangrove resource common property status would be changed through regulation, the fact remain that the air above the mangroves and the water surrounding them (both surface and ground) are still considered as common property so anyone that are involved in economic activities cannot be told not to pollute the air over the mangrove or not to pollute the surface and ground water resources beneath the mangroves because in actuality no owns them; hence the surrounding resources will collapse as described in the Tragedy of the Commons (Hardin 1968). When the air and water (surface and ground) are polluted they will cause a great amount of degradation and destruction to the mangrove forests which will cause them to reduce in area. This has been so extensive in some areas of the world; those areas which once had mangroves are today completely without because of all the unregulated negative externalities cause by economic activities over the years (Baten 2009). Common Property Common property is basically any resource that is considered shared property or have no specific ownership or property rights and this includes a wide range of natural resources along with the goods and services that can be derived from them (Wade 1987). In many countries the mangrove forests are considered as common property in which a lot of individuals use the mangrove forest as a means of making a livelihood by harvesting its various products such as wild meat, timber, fish, shrimp, et cetera. According to Hardin (1968) in an essay titled The Tragedy of the Commons from which he basically emphasized that every individual using the resource (in this case the mangrove forest) will seek to maximize his/her benefits that are being derived from the forest and as result of this the resource will be doomed to overuse which will cause the ecosystem to become depleted and eventually collapse. This problem is evident in many countries worldwide especially in the third world countries where people consider harvesting the timber from mangrove forest is a cheap and affordable source of energy so this leads to widespread degradation and destruction (Scherr and Yadav 1996). For example in Guyana, mangrove timber was used as a source of fuel in cremation and other religious ceremonies. This was also practiced among the Hindustani community in Suriname. Solutions Negative Externalities The problem of negative externalities can be solved by the parties that are involved and one of the most common ways of doing this is through a political process that is called a tacit agreement. In this system, governments are elected that represent the citizens and to come to compromises in certain interests (Hussain 2011). In the case of the mangroves, what happens is that governments pass laws and regulations to address the negative externalities that affect the mangrove forests e.g. in countries such as Guyana, Fiji, et cetera there has been implementation of mangrove management plans that set standards, targets and processing requirements as it relates to mangroves so that destruction and degradation will be reduced. This is what is known as Command and Control Regulations which also includes environmental taxing reforms (Pigouvian taxes) where each unit of pollution is taxed (Hussain 2011) e.g. environmental tax on plastic bottles used in the beverage industry of Guyana tradable pollution permits or the creation of markets for ecological services similar to those that are used in Europe. Another strategy that can be used is through bargaining in which stakeholders can come together and come to common grounds to bring about and efficient outcome without government intervention which would put stricter sanctions on the use of the mangrove resource and this is known as the Coase Theorem (1960). This was put into practice in Jamaica to reduce the rate of deforestation of the mangrove forests as well as other forest types on lands that are privately owned. Common Property According to Hardin (1968) and others suggested the most likely solution to The Tragedy of the Commons is to impose some form of regulation on the small scale livelihood activities that utilize this natural resource since it would be in the best interest to society for this to be done. This regulation is also needed because if this ecosystem collapses, there will be a great cost that will be bourne by all of society since the many ecosystem services such as coastal protection, erosion protection, et cetera will be lost. In Guyana, the common properties status of mangrove was somewhat eliminated by designation the responsibilities of the mangrove resource to the Guyana Work Services Group (WSG) which have responsibility for sea defences and this include the mangrove resource (Guyana Mangrove Action Project 2011). Regarding the legislation that was needed to make this solution more efficient, a legislative review indicated that mangrove protection to more will be more efficient when loopholes are closed. Fortunately the legislative framework for immediate protection already existed and as it was within the power of the Minister of Agriculture to declare any tree a protected species and this was done (Guyana Mangrove Action Project 2011). On January 29, 2010 the Minister of Agriculture amended to Regulation 17 of the Principal Regulations by the substitution of the following (Guyana Mangrove Action Project 2011): Protected Trees 17. (1) No bullet-wood tree or red, black or white mangrove trees shall be felled without first obtaining the permission in writing of an authorized forest officer not below the rank of an Assistant Commissioner of Forests (GoG 2009) so this effectively listed the mangrove as a special category under the GFCs code of practice. Rangers called mangrove wardens were also trained and hired then stationed in a newly established mangrove management units which has the responsibility to regulate any activities taking place within the mangrove forests. Since the implementation of this plan, there has been a positive response in the acreage of the mangroves forest. There has actually been an increase in the area of mangrove forests on Guyanas coast and this has been possible through revegetation and afforestation programmes (Guyana Mangrove Action Project 2011). There has even been natural mangrove regeneration in areas where there hasnt been any growth in many decades because of the unregulated usage that was previously allowed. Discussion In the solution that was used to curb the negative externalities that affected the mangrove resource what was done is that by implementing the environmental tax on goods and services, the cost of the damage that was done to the resource was internalised into the market prices of the goods and service that were produced by the industries which were negatively affecting the resource directly or indirectly. Hence the cost of the damages done to the mangroves was no longer an external cost and this eliminated this inefficiency that was present beforehand (Pigou 1920). Although Pigouvian taxes are an efficient ways of handling the negative externalities that would affect the mangrove resource because basically the more the tax is raised, the more incentive there will be to reduce the level of negative externalities (Mankiw 1998). However, Carlton and Loury (1980) argued that a pure Pigouvian tax instrument will fail to address this problem over the long run so it must be combined with other instruments such as technology and performance standards. With the solution taken toward the common property problem, the strategy simply just reduced the level of access to the mangrove forest which was done using governmental policies that now restricts the way in which the resource is used i.e. a command and control regulation. This system by itself is inefficient hence so they would have to be combined with an incentive or market based solution in the form of fines for breaching the newly set policies hence individuals and firms will have an incentive to follow the policies in order to avoid having to pay the fines (U.S Environmental Protection Agency 2010). Conclusion In the past because of the open-access or common property nature of the mangrove resource we saw that most of the market benefits where only gained by a few select individuals or firms while the non-consumptive benefits (erosion protection, oxygen production, carbon sequestration, et cetera) which could benefit all of society was only short lived. Now that that resource is regulated we can see that it will stay intact for longer periods of time and we can see society benefiting more from it because the non-consumptive benefits (marginal benefits) would be increased and the marginal cost of the resource to society would be decreased.

Destiny, Fate, Free Will and Free Choice in Oedipus the King - Fates

The Power of Fate in Oedipus Rex  Ã‚   Oedipus, the fated tragic hero of Sophocles’s Oedipus Rex, is a complex character who, through slow realization, learns that one cannot escape fate.   Throughout the course of the tragedy, Oedipus’s attitude evolves from arrogance to humbleness as he learns to seek for truth and finds that fate is impossible to control. In the beginning of Oedipus Rex, Oedipus is a strong, noble king in search of justice for the slain former King Laios. Oedipus is both arrogant and ignorant of his future misfortune. â€Å"With the help of God, we shall be saved,†... ... full of rage, curiosity, impatience, ignorance, denial, and finally, remorse.   His persisting denial to accept the enormous coincidences that are made known to him and his complete ignorance towards these facts lead Oedipus to his tragic downfall from a noble king to a blind, humbled, man.

Vocational :: Business and Management Studies:

Vocational A. Calculate break even point on the basis of average guest per week. - Break even = Fixed costs Contribution - Fixed costs =  £35,000 +  £8,650 =  £43,650 - Contribution = Selling price – Variable costs - Selling price =  £150 per person - Variable costs =  £35 +  £3 + £5 +  £10 =  £53 - Contribution =  £150 -  £53 =  £97 - Break even =  £43,650  £97 = 450 guests - This shows that 450 guests are to be held within a 30 week period. Therefore for the charity to break even 15 guest are required each week. In order to heck that the answer I came to is correct I will take the 450 guests (answer I came to) and, should the answer be correct, income – (fixed costs + variable costs) would be equal to 0. Income = 450 x  £150 =  £67,500 Fixed costs =  £43, 650 Expenditure = 450 x Variable costs = 450 x  £53 =  £23, 850 Fixed costs + Variable costs =  £23,850 +  £43,650 =  £67,500 Therefore income – (fixed costs + variable costs) =  £67,500 -  £67,500 = 0 B. Assume that the holiday home is full (20 guests) for the whole period (30 weeks). Calculate the margin of safety and the sales price that could be charged per guest to break-even. -Margin of safety = maximum number of residents – break even -Max number of residents = 600 -Break even = 450 Therefore margin of safety = 600 – 450 = 150 guests When referring to the margin of safety equalling 150, in simple terms this means that the charity can drop 150 guests and still not make a loss. By dividing 150 by 30 it can also be seen that they can drop 5 guests per week making the break even point of 15 guests. Sales Price Selling price x Contribution = 150 x 97 = 14,550 Maximum income =  £150 x 600 = 90,000 (with 600 being the total number of guests.) 90,000 – 14,550 =  £75,450  £75,450 600 = 125.75 This tells us that  £125.75 can be offered to residents to break even. In order to check that the resulting answer is in fact correct I will total all costs and, if the my original answer is correct, they should equal  £75,450 Fixed costs =  £43,650 Variable costs =  £53 x 600 (number of guests) =  £31,800  £43,650 +  £31,800 =  £75,450 - £75,450 600 = £125.75 (per guest) Therefore in order for the charity to break even a charge of  £125.75 can be given to each person. C. The charity can extend its accommodation by renting an adjoining property, this would allow a further 10 guests.

Art Is Important To Religion :: essays research papers

â€Å"Why is Art Important to Religion† Art is important to religion in many different ways. Perhaps none has analyzed how art and religion have influenced and affected each other through the ages. Pictures painted of past events that help to bring back the feeling and importance of the past have been forgotten by some. To the one’s that haven’t forgotten are able to see the event’s as the bible says they happened. Not only can you see the events, but it also allows the younger students of the church to understand the events. The use of images of God became widespread after the second century. This religious art has defiantly been around for centuries and plays an important role to the history of religion as well as the future.   Ã‚  Ã‚  Ã‚  Ã‚  Religious art helps people that are looking for security and hope. Today society is looking for peace and an anchor to hold onto. This religious art lifts the spirit and brings peace within through a beautiful way. It helps reassure people that there is a life after this one. One needs not fear the power of God but to understand his actions and the way one should live his or her life.   Ã‚  Ã‚  Ã‚  Ã‚  Art through the ages has been a powerful voice for both secular and religious ideas, and the treasury of Christian art should not be relegated to museum viewing. The art should be displayed in the church were it is meant to be. Its richness can be brought to people in schools and adult study groups. This, in turn, can help to bring art up to the level, that the faith deserves. Churches should fill the walls with art to show what happened throughout the bible. Art creates connections and associations between what we see and what we sense happened. Both ritual and art challenge us to take us beyond the immediate, if they are to bring about true insight and transformation in our lives. When the religious art leaks out of the religious community and into the broader world of culture, it is one of the ways the meaning of the art can evolve. This is also an opportunity for the art to draw the world to religion. Moreover, artistic reinterpretation of sacred imagery can help keep religion honest. The church has always been enriched by the tension that comes with diversity in art. Art is communication and effective art communicates effectively to any group at any level.

Financial Markets Assignment Essay

Explain how interest rates decline following major Fed purchases of mortgage-backed securities. The FED implements quantitative easing by buying financial assets of longer maturity, e. g. , mortgage-backed securities, from commercial banks and other private institutions in order to inject a pre-determined quantity of money into the economy. This is a means of stimulating the economy and lowering longer-term interest rates further out on the yield curve; quantitative easing increases the excess reserves of the banks, and raises the prices of the financial assets bought, which lowers their yield. Graphically, this can be explained with the aid of Figure below. The supply of money is shifted from point 1 to the right (MS1 to MS2) and, all else equal, the new equilibrium point (with aggregate money demand curve) is at point 2, where the interest rate is lower. i i1 i2 AD1 MS1 MS2 Quantity of Money 2. What could be the implications of lower interest rates for households and businesses? By implanting the policy of purchasing mortgage-backed securities, the FED has set its sight on increasing consumption and investment, which will ultimately increase employment. As described in question one Bernanke’s policy decreased interest rates to new record lows, encouraging borrowing for both businesses and households. The ability to borrow money at more attractive rates stimulates investment in durable consumer goods, such as automobiles, and in operational necessities such as buildings and capital equipment for businesses. Indeed, after the implementation of the policy mortgage applications increased significantly. Because of low interest rates households and businesses as investors could shift their preference away from bonds and into stocks. According to frbsf. org, the increase in stock trading volume has the effect of raising the value of existing stock portfolios, which in turn stimulates consumer and spending across the country due to the psychological effects of rapid capital appreciation. Lower interest rates can have negative effects on the value of the local currency compared to other currencies. As foreign investors dump their local-denominated investments in favor of more profitable currencies, exchange rates can shift to the detriment of the local currency. The weakening of the local currency serves to increase the attractiveness of local goods to foreign purchasers, which has the effect of boosting exports and international sales. All of the factors mentioned above have the combined effect of increasing productive output, or GDP, and increasing employment across a wide range of industries. As individuals, businesses and foreign investors are encouraged to spend more due to increased access to capital, higher portfolio valuations and weaker currency values, businesses in nearly every sector experience an increase in sales, often requiring them to grow their operations and employ additional labor. However, there are some negative implications from this policy. Without a strong commitment to control inflation over the long run, the risk of higher inflation is one potential implication of experiencing real interest rates below the economy’s natural interest rate. Low interest rates provide a powerful incentive to spend rather than save. In the short term, this may not matter much, but over a longer period, low interest rates penalize savers and those who rely heavily on interest income. If short-term interest rates are low relatively to long-term rates, households and firms may overinvest in long-term assets, such as Treasury securities. If interest rates rise unexpectedly, the value of those assets will fall (bond prices and yields move in opposite directions), exposing investors to substantial losses. Finally, low short-term interest rates reduce the profitability of money market funds, which are key providers of short-term credit for many (large) firms, e. g. the commercial paper market. 3. Explain the Fed’s policy dilemma and try to rationalize why unemployment in the US is stubbornly high while inflation is low. Based on the theory of the Philip’s curve diagram we notice that there is an inverse relationship between inflation and unemployment. Stated simply the lower the unemployment in an economy the higher the rate of inflation. Philip’s Curve Inflation Unemployment The explanation of the inverse relationship between inflation and unemployment is based on two assumptions. The first has to do with the fact that as unemployment rises there is no room for workers and labor unions to demand an increase so a wage inflation that would increase the prices of the final products cannot occur. Secondly high unemployment is a reflection of the decline in economic output and indicates an economy’s slowdown. Therefore competition among firms in recession will lead the prices at lower levels. But this is not the case currently in the US since we observe high unemployment and low inflation. The FED is concerned about the unemployment rate and in an effort to stimulate the economy and improve the labor market conditions it started implementing the quantitative easing policy. So the FED purchased MBS, helped banks to rebuilt their balance sheets, contributed into maintaining price stability, preserved interest rates near zero for more than three years, and prevented the economy from slipping into greater recession. Despite all these efforts the situation in the labor market did not improve. Apparently the fact that unemployment is still very high depicts the limitations of the monetary policy. The low business confidence, policy uncertainty, and the government’s reluctance to act are beyond the FED’s capacity. What is more the infinite use of the quantitative easing may produce undesirable effects in the long run such as stagflation. The only optimal solution under these circumstances is the co ordination of the FED’s monetary policy with the government’s fiscal policy plan that could boost the society’s confidence. . Do you think that another round of quantitative easing (QE) by the Fed would help stimulate the US economy? Please explain. The FED declared that the use of QE will be aggressively continued until the economy is improved. The cash injections into the economy helped interest rates to remain at low levels. Consequently everyone wins from this decision in the short run; homeowners can borrow at historical low levels of inter est rate, corporations can also take advantage of this act and invest, consumption increased and also the banks increased their profits and the stocks record a growth. So as long as the QE is active in the short run everyone is a winner. But in the long run things become vague. First of all historical evidence shows that despite the fact that interest rates may be at levels near zero it remains uncertain whether this will be the incentive to boost the actual economy. Secondly the fact that consumers will have more money to spend but fewer goods to buy might lead to a hyper inflation. Furthermore by repeating the use of QE is very possible to lead to a liquidity trap, unless the economy finds ways to stimulate production. Last but not least the FED’s decision to inject cash into the economy by purchasing MBS is questionable; Mortgage backed securities entail the risk of defaulting once again as they did in the real estate crisis and that would cost the Americans a lot more money repeating the history that started back in the September of 2001. To sum up the use of QE is indeed very effective but only in the short run. Short periods of economic recession can be avoided by stimulating the economy temporarily through cash injections but to maintain growth on the real economy we need to improve labor market conditions, productivity, innovation and bolster the economy’s confidence. So a combination of fiscal and monetary policy is the only way to prevent an economy from collapsing, and also is this is the only way to avoid a possible systemic risk that will negatively affect all the institutions and individuals. . How is a loose Fed monetary policy in the US affecting fundamentals (such as inflation, asset and commodity prices) in other countries? What does that imply about global monetary policy? Since the dollar is the vehicle currency in the global economy almost every country is tied to its value and everyone is affected by the monetary decisions of the FED. By the QE, the supply of dollars is increased and consequently the dollar depreciates against foreign currencies. This means that America’s exports will increase and on the contrary the imports will decrease. So countries trading with the US fear about the capital inflows and the possible inflation on commodities. On the other hand the FED support that there can be no further inflation since the global economy is in recession. Moreover countries experiencing huge capital inflows resulting in inflation can implement fiscal policy, such as imposing taxes, in order to contain the effects of foreign capital inflows which push up local stock prices and the currency itself. Every country should focus on its own monetary policy adjusting it to the problems that may experience. For example the US chose to inject more money in the economy. The results of such a decision are low interest rates, more exports but always with the risk of inflation. On the other hand a country experiencing high inflation might limit the money supply, increasing the interest rates with the risk of experiencing a decline in exports.