Accounting Ratio Analysis for Finances

Accounting Ratio Analysis for Finances Ratio analysis is a useful tool for analyzing financial statements. Calculating ratios will aid in understanding the companys strategy and in understanding its strengths and weaknesses relative to other companies and over time. They can sometimes be useful in identifying earnings management and in understanding the effect of accounting choices on the firms reported profitability and growth. Finally, the ratios help in obtaining a better understanding of a firms current profitability, growth, and risk which can improve forecasts of future profitability and growth and estimates of the cost of capital. In reviewing the basic financial ratios, we will examine the ratios of Best Buy for the fiscal years ended March 2, 2002 and March 3, 2001. Excerpts from Best Buys financial statements are included at the end of this document. Best Buy is a growing company. The following table reflects the growth in sales and income during the year ended March 2, 2002: Reference: http://www.docstoc.com/docs/4290867/calculating-ratios A number of accounting ratios are used to measure different aspects of performance. Many of these are derived from a single ratio known as the return on capitol employed. Any business would want high return on their capitol as this is the return on of investments made. But also they want the return to be as high as possible against their competitors. If we look at the results of Marks and Spencer over the five years the ROCE fell from 24.88% to just 14.44% thats a fall of 10.44% however. Compare that to the ROCE of next which was 65.54 in 2005 and it stayed around until 2008 when it went upto 84.73 however in 2009 that figure come down to just 40.10 in 2009 despite the big fall Next look like they are outperforming marks and spencer on the return of the capital invested All businesses want to get as high profit as possible marks and spencers gross profit margin over the period of five years it has been stable if will look at between 2006 and 2008 the gross profit margin stayed around 38% that figure saw a fall of just under 1% in 2009 however marks and spencer is doing better than Next as the gross profit margin of next is lower that ms and comparing over the five years they continue to experience a fall in gross profit margin but between 2007 (27.77) and 2008 (28.51) they experienced an increase of just under 1% in 2009 that did not improve because it started to fall again lower than 2008 The net profit margin of ms was looking was looking good up until 2009 as in 2008 it was 12.51 up from 9.38 in 2005 so it was good period however in 2009 that figure was 7.79 lower than the net profit margin of 2005. more worryingly for ms next is outperforming them over the five years not only are they getting high net profit margin but also it is stable at around 14% between 2005 and 2008 Sales per employee The asset turnover is how well the firm is putting its assets to work. The ratio indicates that the asset turnover of Next is better that MS if we compared between 2005 and 2008 however ms look like they gained ground in 2009 when their asset turnover was 3.41 up from 1.74 in 2008 compared this to next in 2008 Nexts asset turnover was 5.66 this was higher than ms 2008 asset turnover but in 2009 next that figure fell down to just 3.06 and this lower than ms if we compared the same year. The stock turnover of ms has been experiencing downward trend in the past five years the 2005 stock turnover was 23.38 but continouos fall in the next four years meant ms stock was turning over 16.91 however the decrease in stock turnover ms will be encouraged that their competitor next is doing worst than them as their stock turnover was just 10.27 Debtors turnover and debtors collection period This ratio indicates the speed with which debtors/accounts recievable are being collected, thus it is indicative of efficiency of trade management. The higher the ratio and shorter collection period the better the trade credit management and the better is the liquidity of the debtors and visa versa. we can see that the control of credit operating by MS is far better than Next. The debtors turnover being 108.53 and the debtor collection period being approximately 3 days compare to 5.77 for the debtors turnover and 63 days for the debtor collection period for Next. Businesses usually operate on a 30, 60 or 90 days policy in terms of debt of payment. Creditor collection period This ratio reflects the time it takes the company to pay its suppliers. Thus, the longer you can hold off payment the longer you have cash on disposal. We can see that the creditors collection period is low (roughly 14 days) compare to next (approximately 22 days) to pay their debts. So marks and spencer might want to look in to ways of improving relationship with suppliers so that they have enough time to pay them. Current ratio The current ratio is the ratio of total current assets to total current liabilities. The current assets of a firm represents those which can be in the ordinary business, converted in to cash within short period of time. Marks and spencer current ratio decreased in the past five years from 0.65 in 2005 to 0.60 in 2009 and the company is below the national average which is 1.8:1, next is doing better than ms even though they are also still below national average with a current ratio of 1.54:1 in 2009 but that is far from national average like ms. Acid test this ratio specifies whether your current assets that could be quickly converted into cash are sufficient to cover current liabilities. Until recently, a Current Ratio of 2:1 was considered standard. A firm that had additional sufficient quick assets available to creditors was believed to be in sound financial condition. Again just like the current ratio both companies are operating below the national average. MS acid test did not show much improvement over the past five years if we compare it to next in the same period 2005 of the both companies was 0.39:1 for MS and 0.82:1 for next however if we look the difference between the two companies ms is 0.37:1 lower than 2005 but next is improving slightly with acid test of 1.09:1 in 2009. Gearing ratio The gearing ratio reflects the amount of finance raised from the banks in relation to the total capital employed. If the gearing ratio is around 40% it is unlikely that a bank would make any further loans. We can see that both companies are far above the 40% and therefore even though they have good reputations it may cause some problems when obtaining loan. This really needs to be looked at and MS must be concerned about this. However, very large company generally operate above this rate. Reference: http://www.scribd.com/doc/19208907/Financial-Analysis-of-IDEA Part 3 UK is passing through a strong economic downturn and overall spending by the consumers is consistently decreasing. The economic growth of UK over the last three years is slowly and consistently declining[1]with forecasts for negative growth in 2009 and some recovery in 2010. These trends also indicate that almost every sector of the economy will be affected with the slow down in the consumer spending due to credit crunch. It is critical to note that there is a marked difference between the corporate social responsibility of the firm as well as improving the overall corporate image of the firm. Linking corporate social responsibility with the improvement of corporate image therefore is something which most of the companies attempt to achieve. (Moir, 2001). At the moment it looks like ms has escaped from criticism like child labour

Indigenous People Essay

The term indigenous has caused controversy across the world as some people see it an offensive name to describe people, the name is not the only thing that has caused a controversy also the people that this name applies to. Hence there have been many definitions of this word to try and make it more euphemism. Kuper (2003) agrees that this term causes a lot of debate. He argues that however most people prefer the word indigenous because it’s more euphemism than the term native and primitive, he also points out the fact that the name of the people that are seen as indigenous have also changed. We now have for example, Saami for Lapp, Inuit for Eskimo and San for Bushman† (Kuper, 2003:389). According to Kenrick and Lewis (2004) there are four principles that should be considered when defining indigenous people which are; â€Å"priority in time, with respect to the occupation and use of a specific territory, the voluntary perpetuation of cultural distinctiveness, self identification as well as recognition by other groups and state authorities , as a distinct collectivity and an experience of subjugation, marginalization, dispossession, exclusion or discrimination† (Kenrick and Lewis, 2004:5) . Indigenous people across the world are constantly fighting for recognition, they want what is rightfully theirs that is their land they also want their culture back as they are forced to adapt to the culture of the majority. This essay will look at debates around the efforts that they have made to try and bring back their culture. â€Å"Indigenous people are constrained to present their culture in ways that reinforce the dominant society’s worldview† (Kenrick and Lewis, 2004:9). As stated above indigenous people are fighting for recognition as they are treated unfair by their governments, as a result of colonization they had to stop practicing their rituals, hunt and gather food because they were forced to adopt to the western way of doing things. Even Kuper (2003) agrees to this when He states that indigenous people â€Å"demand recognition for alternative ways if understanding the world, but ironically enough they do so in the idiom of western culture theory† (Kuper, 2003:395). An example would the Bushman of Botswana and the Abatwa people of KwaZulu-Natal. The San of Botswana were forced to move from where they were staying because according to their government they were living there illegally. They were placed in the Central Kalahari game reserve where they were not even allowed to hunt for food because it is against the law (Kuper 2003). Even â€Å"Environmentalists complained that that residents were keeping donkeys that interfered with the game and that they were engaged in poaching† (Kuper, 2003:393). They found themselves restricted by rules as to what they should and should not do; they were restricted by the law when they had to practice their rituals and culture. It became worse when the â€Å"Botswana court refused to order the government to continue to provide services to people living in the Central Kalahari Game Reserve† (Kuper, 2003: 392). They found themselves working which was something that they were not used to do. It can be argued that this change must have affected them emotionally as one now had work to support their own family. Bushman rely on each other on almost everything as sharing is one of their characteristics; they share things like Tobacco, meat and plant food that was gathered. The Botswana government was unfair and inconsiderate in a way; what happens to households where there is an elderly person who can’t look for work? Or households where people have been trying to look for work and have no luck? Because people now used money to satisfy their needs and wants they no longer depended on natural resources that they used to share, sharing what you’ve worked hard for is hard. The Bushman of KwaZulu-Natal usually known as Abatwa were facing similar problem to that of the San of Botswana. They were also restricted by law when they had to perform their rituals, especially from the provincial heritage organization called Amafa. According to Francis (2010) â€Å"Amafa has acknowledged that the Abatwa people are the descendents of the painters, but limits their access to their heritage. By dictating who could enter and when, Amafa impinged on the community and what it felt was their rights† (Francis, 2010: 48). As stated above the Abatwa people are not in control of their heritage there are people who make decisions for them regarding what is rightfully theirs. Francis (2010) states that there is a fence around the paintings and rocks that belong to the Abatwa people. He states the Abatwa people â€Å"feel ostracized from their heritage and dread future dealings with Amafa, already their general access to the rock art sites is restricted and as such they rarely visit the main caves. † (Francis, 2010: 48). The Amafa use the Abatwa heritage to attract tourists and make money, they also use them for educational tours where students studying archeology come and study those rocks (Francis, 2010) That doesn’t end there Francis (2010) also point out that their rituals are a public thing instead of private as they are people guarding them when they perform them, they are also ordered not to touch these rocks. There are also a limited number of people that must attend rituals. Despite of all the challenges that these people face they still did not given up on trying to assert their indigenous identities. An example would be again of the Abatwa people of KwaZulu-Natal. According to Francis (2010) these people are Zulu speakers who decided to â€Å"reassert a San/Bushmen ethnicity in a region where all San are supposedly extinct or fully assimilated† (Francis, 2010: 41). They live in the Drakensberg Mountains and have done so much to re-event their culture, they do that with help of archaeologists, anthropologists, they read and also their memories by remembering the pieces of their past (Francis, 2010). Since they cannot remember all the ceremonies that their ancestors use to do they came up with new ones, these ceremonies follow up â€Å"from other cultural practices and beliefs and oral memories that can be traced back six generations to a point when the ancestors lived as hunter-gatherers† (Francis, 2010:42). The most practiced ceremony that they made up is called the eland ceremony which is to honor the crossing of the dead into afterlife where they live with their ancestors (Francis, 2010). According to Francis (2010) the eland ceremony â€Å"has a central figure in San cosmology long before the advent of colonialism† (Francis, 2010:45). This ceremony shows the struggle that the Abatwa are going through in trying to reclaim their identity, as some of them have left their culture and followed the dominant ethnic group (Francis, 2010). These ceremonies that they perform are a â€Å"defiant refusal to give what is gone† (Francis, 2010:49). The Abatwa do so much to claim their identity back, they feel that regardless of what they lost the little they have is worth keeping (Francis, 2010). One of the major challenges that indigenous people have face is the fact that people expect them to behave like their fore fathers. According to Besten (2011) there has been a debate going on about how indigenous people have changed. In nowadays many of them do not practice their rituals, they do not wear their traditional clothing and they do not speak the languages of their ancestors. Besten (2011) argues that there has been a lot a stereotyping of the indigenous people, many scholars still expect them to do exactly what their ancestors were doing. He states that â€Å"Popular image suggest definite and unchanging markers of Khoe-Sanness, such a being short in stature, having yellow-brown skin, using click languages, hunting, gathering or herding and wearing clothing made from animal skins† (Besten, 2011:176). It can be argued that the fact that indigenous people have changed and adapted to western ways of doing things might have an impact on them not taken serious in trying to reassert their identities. As stated in the first part of this essay indigenous people were forced to lose their identities by adapting to the western ways of thing and according to Besten (2011) that has backfired. Besten (2011) states that indigenous people â€Å"are not likely to be taken seriously if they do not conform to, or approximate their primordialist and essentialist expectations† (Besten, 2011:179). According to Besten (2011) indigenous people who are lacking the qualities mentioned above are called fake. The above statements suggest that if indigenous people want to be recognized and taken seriously by people they must go back to their ancient ways of doing thing which is not easy as their lands and identities were taken and there are laws now that restrict them from doing their rituals. Indigenous people do not need to conform to certain labels that are put on them in order to be recognized. The media and scholars have played a major role in this stereotyping of indigenous people. â€Å"A primordalist and essential discourse about the Khoe-San has manifested itself at various sites, notably in museums, the media and school history books† (Besten, 2011: 177). In almost all museums around the world San people are projected as â€Å"Quintessential human beings of nature† (Besten, 2011: 182). They are shown with grass house, wearing animal skins or half naked children with big tummies. Besten (2011) argues that westerners longing to see Bushman led to exploitation of these people. He made an example of the Khomani people who lived in Kagga Kama how they were stereotypically presented in the media (Besten, 2011). To help market the Kagga Kama Khomani were asked to demonstrate a â€Å"vulnerable , natural hunter-gathering way of life with the help of reserve owners† (Besten, 2011:186). These people were asked to fake who they were so that they can attract tourists, they were asked to wear their traditional clothing and grass houses were built to live in (Besten, 2011). These people used the San culture for their own benefit, they portrayed them the exact same way that people expect them to be. In an effort to claim their identities and to be recognized, indigenous people have managed to take the stereotyping to their advantage. They have decided to embrace those stereotypical characteristics. In every conference or public gathering that they were invited to they would wear they traditional clothes and speak their languages. According to Besten (2011) in a conference on Oudtshoorn a Bushman who spoke ! Xun language opened and closed the ceremony with prayed He pointed the fact that this prayer not only â€Å"reflected the religiosity of conferee, but were also significant acts of cultural, linguistic and psychological affirmation† (Besten, 2011:184). Also in a conference that was held in South Africa Cultural and History Museum a Khoe-Khoe chief was wearing his eye-catching traditional clothing which was a veil and headband bearing leopard design (Besten, 2011) , telling people to take pride in their culture and origin. When Sara Baartman the Khoe-San woman whose body was displayed in a museum in France’s remain came to be buried in South Africa the Neo-inqua chief performed traditional Khoe-San ritual which included burning aloes and sprinkling water all over her coffin (Besten, 2011). The above scenarios illustrate the efforts that they have tried in claiming back their identity and how they have taken these stereotypical characteristics that people have about them and embraced them. In conclusion indigenous people have done a lot to try and reclaim their identity but it seem like their efforts are falling on deaf ears. They are not taken seriously by their government and they are expected to fit in a stereotype in order to be recognized. Their efforts are exploited and misused by their governments. They are used as tourist attraction by some people their governments are fully aware of that but they are not doing anything about it. When they want to perform their rituals they are not given privacy that they deserve not only privacy but they cannot even access their heritage. But they still do not give up, each and every day the struggle continues.

The Role Of The Principal Teacher - 1049 Words

An evolution the role of the Principal Principals have been in American schools for more than a century; there are more principals than any other administrative office in education. The principal serves as a as a liaison between district administration, teachers, and community members (Mondale, 2001). When America was rural and the country’s population was low, schools were often single building, single classroom schools. As population increased and schools started to provide more services it was necessary to have managerial and clerical support for the teaching staff. These changes came along in the middle of the 19th century. In the early 19th century principals were called a principal teacher. A principal teacher was required to fulfill many roles in the community and in the school house. With the growth in population came the growth of schools, and eventually teaching and other duties required became too much for a single educator to manage (Mondale, 2001). The role of the principal became separate from that of teaching. Today, the principal main focus is on student achievement, leadership, and the managing of the school. According to Vinella (2007), school reform with the aim of increasing student achievement begins with â€Å"the leadership of the principal† (p. 67). School administrators face a myriad of daily choices: how to organize meetings and professional development, how to best utilize funding, how to protect learning time and balance school extracurricularShow MoreRelatedThe Role Of Principal And Teacher Retention1291 Words   |  6 Pagesqualitative research study of The Role of the Principal and Teacher Retention. The purpose of this study is to better understand teacher retention and teacher attrition among elementary school teachers in Prince George’s County Public Schools. 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Contingency - The Relationship Between Behavior and Reinforcement

Definition: Contingency is the relationship between two events, one being contingent or a consequence of the other event. Behaviorism (ABA) sees all behavior as a response to an antecedent and driven by the consequences. All behaviors have a consequence, even if that relationship is not very clear either to the observer or the student who may be the focus of an intervention, either behavioral or instructional. The goal of an Applied Behavior Analysis intervention is to change behavior. It may be to increase the desired behavior, to replace a problematic behavior or to extinguish a dangerous or difficult behavior. In order to increase the desired behavior, the student needs to know that receiving reinforcement is directly related to the behavior, or contingent on the behavior. This relationship of contingency is incredibly important to the success of an Applied Behavior Analysis program. The success of establishing contingency requires quick reinforcement, clear communication, and consistency. Students who dont receive immediate reinforcement, or are not clear about the relationship of contingency, will not be as successful as those children who clearly understand the relationship or contingency. Examples: It took a while for the team at Jonathons school to help him understand the contingency between his behavior and receiving reinforcement, so they repeated a simple imitation program with direct, one to one reinforcement until he would comply regularly.