Risk Tolerance in Financial Decision Making

Question: Discuss about the Risk Tolerance in Financial Decision Making. Answer: Introduction: This report is based on the Harvey Norman Holdings Limited's 2015 annual report. Harvey Norman is listed on the Australian Securities Exchange as a public company operating in the security exchange market. This report will analyze the company's 2015 book value of debt and the book value of equity. Conversely, Harvey Norman's Interest Rate Risk Management has also been scrutinized as well. Harvey Norman's book value of debt As at 30th June 2015, Harvey Norman's book value of debts stood at $ 1,801,684 million which was an increment from $1,715,025 during the 2014 financial year. The book value of debt comprises of both the current liabilities which stood at $1,283,079 and non-current liabilities which was $ 518,605. Both categories of liabilities were increased between the financial years 2014 and 2015. Harvey Norman's book value of equity As at 30th June 2015, Harvey Norman's book value of equity stood at $2,556,860 which was an increment from $ 2,491,106 during the 2014 financial year. The total value of equity is made up of; a) contributed equity at $ 380, 328; b) Reserves at $ 113, 290; c) retained profit at $ 2,043, 463; and d) Non-controlling interests at 19,779. All these categories of equity, as listed in the company's annual report, had all increment between the 2014 and 2015 financial years. Harvey Norman's Interest Rate Risk Management According to the company's 2015 annual report, Interest Rate Risk Management has defined as "The risk that movements in variable interest rates will affect financial performance by increasing interest expenses or reducing interest income (Campbell, 2014, p. 23)." The company's interest rate risk during the 2015 financial year arose from balance sheet items such as bills payable, cash and cash equivalents, bank overdraft, borrowings, non-trade debts and non-trade debts owed to related parties and directors. Harvey Norman's interest rate risks range between 0.01% and 12% according to respective items named above. The following table shows a summarized interest rate risks according to different balance sheet items: Balance sheet items Interest rate risk Floating Fixed Cash 0.20%-3.60% 0.01%-4.10% Loans 9.00% Receivables 10.00%-12.00% Non-trade debtors loans 4.32%-12.22% 7.00%-12.00% Borrowings 0.47%-5.93% Interest rate swaps 5.21%-5.54% Other loans 3.07%-4.22% Bank overdraft 1.97%-6.68% Bills payable 2.08%-2.72% Finance lease liabilities 9.50% Other financial liabilities 5.21%-5.54% Note: As a consolidated entity, The Company pays its interests at different floating rates to prevent the risk interest rates from increasing. Sensitivity analysis on the companys interest rate risks The Harvey Norman holding uses a sensitivity of 50 basis point decrease and 50 basis point increase based on the fluctuation of the Australian dollar exchange rate both in the short and long run. The interest rate risk analysis shows that in the event that the rates moved, the after tax profit would be affected (other factors remaining constant) (Harvey Mayne, 2016, p. 122). The change in the post-tax profit is caused by lower/ higher interest rates from cash balances and variable rates of debts. Likewise, the movement experienced in the comprehensive income resulted from decrease/ increase in the fair value of cash flow items. The movement of interest rate experienced in 2015 was less sensitive compared to those in 2014 (Harvey Mayne, 2016, p. 123). References list Campbell, J. Y., 2014. The Econometrics of Financial Markets. Princeton University Press: Washington, DC. Guenther, D. A., 2004. Financial Reporting and Analysis. New York: McGraw-Hill. Harvey, N. Mayne, J., 2016. 2015 Annual Report: Harvey Norman Holdings Limited, Kent Street, Sydney NSW: Harvey Norman Holdings Limited. Kaplan, D., 2012. Introduction To Financial Statement Analysis. New Delhi, India: The Kaplan Group. Lucarelli, C., 2011. Risk Tolerance in Financial Decision Making. Washington: Palgrave Macmillan Studies.

Cultural Identity free essay sample

â€Å"Representation; refers to the way people, events, issues or subjects are presented in a text. The term implies that texts are not mirrors of the real world – they are constructions of ‘reality’. These constructions can be shaped through the writer’s use of conventions and techniques.†1 Cultural identity; â€Å"the identity of a group, culture or individual as far as one is influenced by one’s belonging to a group or culture.†2 The epic drama Australia, (2008), by award-winning director Baz Luhrmann, is the second highest grossing film in Australia’s history. Australia is set during the Second World War. A context and time different from ours and therefore one, which allows for an examination of cultural identity and those values, beliefs and attitudes which we as a nation have, normalized and some of which we have challenged. The setting allows cultural beliefs to be exaggerated and also contradictory to the majority of today’s beliefs, therefore creating a larger response from the viewer. These cultural beliefs – representations of the time – are both challenged and normalized throughout the film. This includes the belief that Australia was a typical wild-west nation and the cultural attitude that the indigenous race was inferior. These beliefs are fundamentally raised through the use of various writer’s filmic techniques. These techniques used by Luhrmann include the use of dialogue, symbolism, camera lengths and repetition. It is through these techniques that Luhrmann raises various cultural beliefs throughout the film. A significant cultural belief that is represented in the film Australia is the attitude that Australia was viewed as a mysterious and often Wild West nation. This representation is strongly normalized throughout the film. Luhrmann uses filmic techniques including the use of dialogue, camera angles and scenery to portray this cultural identity. â€Å"But Lady Sarah Ashley (Nicole Kidman), its Australia,† says her butler (Peter Gwynne). Through the use of dialogue, Luhrmann has encouraged a negative viewpoint towards Australia. Emphasizing â€Å"Australia† has the effects of portraying Australia as a real unknown, unpredictable and dangerous nation. Another technique is the use of panning and craning camera angles. The effect of this filmic  technique is that it enables the Australian landscape at large to be in view. Within this view we as the viewer acknowledge a truly Wild-western theme. This is seen through the barren landscape and constant swirling of dust. Furthermore this dust is a constant motif throughout the movie. The dust is interchangeable throughout as smoke or mist amongst other substances. The effects of this motif are to further add to the mysteriousness of Australia. Further use of dialogue reinforces this cultural belief. â€Å"Carney (Bryan Brown) is the authority around here†. Through the use of dialogue Luhrmann has encouraged Australia to be viewed as a typical Wild West nation. This is because, as seen in the Wild West, a big business owner (King Carney) has the power of the town. It is even more stereotypical that he is a cattle baron, with baron having the connotations of power and greed. It is through these filmic techniques that Luhrmann has normalized the cultural belief that Australia is a mysterious and typical Wild West nation in his representations of cultural identity. A cultural attitude that is represented by Luhrmann is that the indigenous race is inferior to the white peoples race. This cultural identity is both normalized and challenged throughout the film Australia. A significant method Luhrmann has used to portray this attitude is through the dialogue and attitude of characters throughout the film. â€Å"It’s a fact of science that the Aboriginal mother soon forgets her offspring†. This quote provides an extremely negative representation that supports the cultural identity that the indigenous race is inferior to white people. This is seen how the quote likens an Aboriginal mother to an animal, who forgets their offspring. Furthermore, the basis that it is simply a ‘fact of science’, something we know not to be true, portrays how strong this cultural identity was at the time. â€Å"I’m as good as black up there†. This quote from the Drover truly typifies the lack of understanding of racism at the time. We come to understand the Drover as one of the strong supporters of the indigenous throughout the movie. However, in this quote, the Drover basically suggests being black is a bad thing. This is a typical representation of understandings at the time. Even those who were against racism still lacked the knowledge to understand what drove racism and committed racism themselves. This is still seen today (Harry O’Brien saga). Nonetheless this  representation may be reinforced for the majority of the movie but there are parts where it is challenged. Lady Ashley states â€Å"Jus t because it is doesn’t mean it should be†. This statement is broad, however it is identifying that just because something is accepted by society, doesn’t mean it is the correct approach. Specifically, she is relating this to racism and the belief that the indigenous are inferior. Ashley challenges the belief that the indigenous are viewed as inferior. This displays that Luhrmann for the majority of Australia normalizes the representation that the indigenous are inferior, however in small doses challenges it. Luhrmann raises this representation of cultural identity through the use of various filmic techniques including dialogue. A last strong representation seen in Australia is the cultural belief that men and women are not equal. In the film, Luhrmann normalizes the cultural identity that men are superior to women. This cultural belief is reinforced through the use of dialogue and setting. Throughout Australia there is a recurring theme that women are inferior to men. For example, the bartender states â€Å"No women† are allowed in the bar. They are required to go to their own segregated lounge in the dungy, back of the bar. This use of setting in the bar reiterates this cultural belief. Another example is the proceedings in town when a dance with the women of the town is sold to the highest bidder. It conveys the idea that women are items that can be bought. This strong use of symbolism reinforces the cultural belief that women are inferior. Another example is the second time Lady Ashley enters the bar, the bartender again states â€Å"no women†. The use of repetition reiterates this representation. Eventually, she is granted a drink, however she is only permitted it due to her incredible trek across the â€Å"Never-never†. This represents that women have to prove themselves to be worthy to society, whilst men are just accepted. Luhrmann constantly reiterates this belief throughout the film in different examples to identify the problems seen in a pre-feministic world. He displays these problems through his representation of the cultural belief that women are inferior to men. This cultural identity is normalized through the use filmic techniques includi ng symbolism and dialogue. In the film Australia, Baz Luhrmann displays various representations of different cultural identities seen during the Second World War in a pre-feministic era. This includes the normalized cultural belief that women are inferior to men. He also normalizes the cultural belief that Australia is seen as a mysterious and ‘Wild-western’ nation. Lastly, he normalizes, and in some parts challenges, the cultural attitude that the indigenous are viewed as inferior to white people. Luhrmann displays these representations of cultural identities with filmic techniques including dialogue, symbolism and camera angles. This is how Baz Luhrmann has raised representations of cultural identities in the film Australia through the use of filmic techniques. Furthermore Luhrmann normalizes and/or challenges these representations of cultural identities by filmic techniques.

A profit margin Essays

A profit margin Essays A profit margin Essay A profit margin Essay Already highly competitive and overcrowded market; establishing a new name in this area would be very difficult and an expensive business.  As Giusti is a well established firm in this sector with a worldwide customer base it has already overcome these threats of entry. The company however is constantly looking to widen its product range; recently in the field of storage silos and homogenisers for cosmetic creams. In the new product range these barriers do exist and Giusti struggles in this area, as it does not have sufficient personnel to develop these new ranges. As a result we find that new products are evolutionary rather than revolutionary. The company tends to develop products on the job, and this is a practice common with small engineering companies. It is beneficial in that it keeps overheads low but when the newly developed product does not perform as anticipated then the rectification costs can escalate as generally the unit is on site at a customers factory.  Becomix, who are a German competitor of Giusti, have similar problems but a higher level of manning so development can be carried out along side production engineering. Threat Of Substitutes  Manufacturing in the United Kingdom has been on a general slow down for a number of years now and this is reflected in the customer base Giusti has in this country. Along with other process equipment suppliers Giusti has accepted that, especially in the food sector, the use of second hand vessels and pumps etc is becoming more and more common due to constraints on expansion budgets. As a result the company has formed close ties with second hand equipment stockists and, where appropriate, will offer the option of using new or pre-used equipment. Bargaining Power Of Suppliers  The price of stainless steel is elevated due to surcharges for nickel content, but this is fairly constant and common to competitors. Occasionally a customer may specify that a particular manufacturer of ancillary equipment be used in a project and in cases like these it is very difficult to negotiate significant discounts.  Giustis prices have been known to be at the upper end of the market scale in the past and great efforts have been made over the last nine years to reduce the cost of the equipment by increasing the efficiencies in the factory (purchasing seam-welding equipment, the increasing use of computer controlled laser cutting, economic batching of standard components, etc.), value-engineering the equipment to reduce materials used, required fabrication, machining, polishing, and fitting time on the shop floor. The efficiency increases have resulted in the company being able to use a nine year old pricing list for current, and much improved, equipment. The area that is still expensive is the control systems and bought out components.  The company has been aware for some time that many bought out components (valves, pumps, gear units, electrical equipment, etc.) are manufactured in India and the Far East, shipped to Europe and then distributed on to the customer. In setting up an office in India three years ago the company is endeavouring to cut out the European middle-man and gain the cost saving. Ironing out the reliability and quality issues with these suppliers is key to this initiatives long-term success. Bargaining Power Of Buyers  In recent years the customer base serviced by Giusti has seen a rationalization; with pharmaceutical companies merging, e.g. SmithKline Beecham and Glaxo Wellcome now knows as Glaxo SmithKline (GSK), and firms such as Avon Cosmetics relocating to save on production costs, i.e. moving production from Northampton to Poland. As a supplier to these companies Giusti now have fewer customers but the buyers that remain now have greater bargaining power. In a suppliers seminar held by GSK in the last year they stated that all suppliers were to reduce prices across the board by 21% if they were to remain on the recommended suppliers list. As stated earlier Giusti has made great efforts to reduce production costs in an attempt to maintain profitability but when customers such as H. J. Heinz hold tendering auctions on-line and award the contract to the lowest bidder then there is a point where a line is to be drawn between maintaining a busy factory and maintaining a profit margin.  Becomix do not enter into pricing or delivery time battles, relying on the quality of their products. The price on the box is the price that everyone pays and stated delivery may go back, but never be improved on. They have a perceived added value that is high and is sufficient to bear a price and delivery premium.

Are Eyewitnesses Reliable essays

Are Eyewitnesses Reliable essays Studies say that even though 50% of eyewitness testimonies are wrong, the information given to the jury by a confident eyewitness beats the reliable facts of fingerprints and DNA. Researchers have studied the affects of eyewitness testimony and it is said that incorrect eyewitness identifications account for more convictions of innocent people than any other causes combined. Two studies have shown that after being questioned for a crime, positive feedback by police enforcers or other investigators made the eyewitness more confident, even if there answer was wrong. Unfortunately, how confident people are about making identifications doesn't necessarily reflect how accurate their identification is. In fact, an eyewitness' degree of certainty is quite flexible and can easily become overblown. "Confidence levels can be influenced by external factors that have nothing to do with the witness's actual memories or perceptions of the event." (psychologist, Elizabeth Brimacombe). I believe that eyewitness testimony should not be used in court cases in which it is the only factor of determining the defendant's future. Other factors should be considered. In some cases, the jury may not understand the concept of DNA and might not understand the importance and the accuracy of it. They have to understand also, that the witnesses are not lying or being deceptive, they are moral citizens and are trying to be contributive. In order to understand why eyewitnesses have such a high incorrectness level, it is important to know a few things about memory. A person's memory does not function like a video recorder. It is more like static, which changes and fluctuates over time. When someone experiences a consequential event, they remember only fragments of the situation and re-associate the information with previously stored memories and also prior expectations. Often times an event occurs in a split second and accurate details about the ev ...

Hydrogels Term Paper Example | Topics and Well Written Essays - 2000 words

Hydrogels - Term Paper Example A hydrogel construction can be described as a three-dimensional jetty is made up of linear polymer chains with covalent connections, which are in turn connected together by further cross-connections. These cross-connections could be covalent, ionic grafts or crystal sections [2]. Hydrogels form due to polarity and hydrophilic nature of polar groups existing between the polymer chains cross-connections that render it insoluble. There are several known methods of synthesizing hydrogels, some of which are explained below. A simple method of constructing hydrogels is by crosslinking water-soluble polymers (with functional groups like -OH, -COOH, -NH2) in solution. In solution co-polymerization reactions, ionic or neutral monomers are mixed with a multi-functional crosslinking agent. The reaction is initiated thermally using UV-light, or by a redox initiator system. The solvent serves as heat sink and minimizes temperature control problems. The reaction is carried out in an organic solvent to prevent water from reacting with the crosslinking agent. Once crosslinked, the resultant hydrogels are washed with distilled water to remove any unreacted monomers, crosslinking agent, and the initiator. Equation 1 shows one such solution polymerization reaction conducted on 2-hydroxyethylmethacrylate monomers to form a hydrogel. This solution crosslinking method is often advantageous since the starting material used can be a well-characterized, purified polymer, and the crosslinking conditions required are mild enough to be carried out in the presence of an active agent. For example, poly (2-hydroxyethyl methacrylate) hydrogels are prepared from hydroxyethyl methacrylate by this method, using ethylene glycol dimethacrylate as the crosslinking agent [3]. The hydrogels synthesized can be made pH- sensitive or temperature-sensitive as required by incorporating methacrylic acid or N-isopropylacrylamide [4] as monomers. Ionizing radiation, such as Co-ÃŽ ³ or

Unhappy Customers Personal Statement Example | Topics and Well Written Essays - 750 words

Unhappy Customers - Personal Statement Example Unhappy customers On the other hand a satisfied customer pulls number of other customers towards the organization and service. Customers help defining success in a way that they set benchmarks for what is in demand, and things that need to be avoided or are out of date. For them its more about quality than the costs, they are willing to pay more for comfort and quality rather than low quality and more hassle of repair and low productivity. The policies so made should be customer centric. Customers’ response is related to the online sales and services as well as the physical world businesses responses. A relationship matrix can be defined in this way to identify all the factors and benefits that may be achieved through successful implementation of customer response and satisfaction. A prime example in this regard was seen when a musician had his guitar damaged in an aero plane flight and when the compensation was demanded, it was not provided; the same musician went on to make a song on the Unit ed Airlines services and this incident and ended up with millions of views to his video and song, this earned the company a bad name, and in the end they had to apologize and provide compensation, all to customer dissatisfaction (Cheryl Hamilton 2010). Customer Relationship Management is an approach towards establishing a relationship with the customers and working to their satisfaction and demand, in other words, a key to success. C.R.M stresses upon focusing on individual customer rather than masses, this helps knowing the customer behavior, the past experiences. The entire process would focus on the manufacturing strategy, the services to be provided after the product is prepared. Customer identification, differentiation, and personalization are few important terms and phenomena that need to be taken into consideration while dealing with the customers since every customer has a different taste than other, and so is the demand and requirement. The differentiation aspect helps identifying the customers that are more regular, have larger stakes on hold, and are slightly sensitive to the subject and services, and since all resources might not be available every time, implementing them at the right place and towards the right custome r becomes important. Paretho Principle is another similar concept related to the customer response. It is also known as the 80-20 rule, and according to it, the 20 percent customers that makes up for 80 percent of the sales. It is being stated that cost of making a new customer is far higher than retaining one. Even the 5 percent customers retained, results in 25 percent increase in overall productivity of an organization (Ronald S.Swift 2001). Besides customer satisfaction the individual characteristic of the product or service defines the rate of customer turnover from any company or brand. Customer response is considered a Key performance Indicator (K.P.I) and based on its value; the company’s performance is measured in the marketing world. Surveys are being conducted about particular product or service, or the overall experience of the customers with the company, based on their response in the rating scale, further strategies are being devised that helps molding the struc ture of company according to the need of customers. A company must be open to claims, and repairs, however the best policy is to prevent rather than repair, it helps in many ways, not

Financial Management Term Paper Example | Topics and Well Written Essays - 1250 words

Financial Management - Term Paper Example income statement (Profit & Loss Account), statement of financial position (Balance Sheet) and a statement of changes in financial position (Cash Flow Statement), it is called Accounting Ratio. Accounting Ratios are very powerful analytical tools for measuring performance of a business enterprise. The basic objectives of Ratio Analysis are: To provide a deeper analysis of the liquidity, solvency, profitability and activity levels of a business enterprise. To know about the potential areas that could be improved with more effort in the desired direction. To provide information for making inter-firm comparison and intra-firm comparison by comparing firm’s performance with best in the industry figures. The advantages of using Ratio Analysis are: These ratios help the management to analyze past performance and also to make future projections. Interested stakeholders as shareholders, investors, creditors and governments and independent analysts can evaluate certain aspects of a busi ness with the help of ratio Analysis. Accounting ratios provide an easy way to compare current performance with previous periods. These Ratios correctly elucidate the strengths and weaknesses of a firm’s operations and provide a clear insight about the financial health of a firm. Current Ratio The purpose of this ratio is to shed further light on the short-term solvency of the company and, more specifically, on its ability to pay the debts as they fall due, by calculating the relation between current assets and current liabilities. A widely used rule of the thumb is that a current ratio of 2:1 is an ‘ideal’ ratio. However, such a generalization is not always true. The standard ratio will vary from industry to industry and within the same industry from season to season, depending upon the rate at which current assets are converted into cash and how quickly current liabilities must be paid. The ratio cannot be accepted as adequate without considering the compositio n of its current assets and their liquidity. A high current ratio will not be a measure of solvency of business if the current assets are made up mainly of obsolete stock or debtors outstanding for a long time. The current ratio of PepsiCo is 1.44 (PepsiCo Inc., 2010) while that of Coca Cola is 1.13 (Coca-Cola Enterprises Inc., 2010). Though the current ratios of both the companies fall short of the ‘ideal’ standard but considering the fact that both are multinational beverages giants in their own right it must be said that PepsiCo scores over Coca-Cola in this regard as it is in a better position to honor its current liabilities as and when they fall due. Profitability Indicator Ratios Profitability ratios measure a concern’s degree of success in earning a return on sales or on investment. The rate of return on capital employed, often described as the primary ratio, relates the income earned from the company’s activities to the resources employed by the c ompany. The ratio indicates the efficiency with which the capital employed in the business is being utilized, and by comparison with other businesses it may provide a means of evaluating whether the management has the ability of to earn a reasonable income for the company with the resources at their disposal. There are a number of ways of computing rate of return on capital employed depending upon the definition of ‘capital employed’. The term ‘capital employed’ is used, in accountancy to signify three different financial totals: (i)