Public Health Challenge Essay

Possibly the most imperative public health challenge for the United States today is the obesity epidemic the population has. This obesity epidemic, is linked to an array of costly and debilitating health consequences. The widespread challenge of obesity and the health problems and concerns that go with that is an American public health problem. FDA’s approval of two new medications that can help to decrease some of the obesity , decrease some of the chronic diseases associated with obesity, and decrease the costs associated with obesity. This essay will be addressing these pertinent problems and will prove that the new FDA drugs approved for weight loss will help American’s with weight loss that will decrease obesity, decrease chronic illnesses that are associated with obesity and decrease health care costs. Prevention of obesity along with investing in research is necessary for us to see a change in the obesity epidemic (Hammond, 2012). Research suggests that decreasing obesity will decrease the costs of health care, decrease chronic illnesses associated with obesity. Total obesity costs would be much more reduced, along with the cost for other conditions caused by excess weight in our population (Finkelstein, Trogdon, Cohen & Dietz, 2009). Research suggests that the newest FDA approved diet pills will benefit Americans by decreasing obesity, decreasing chronic diseases associated with obesity and decreasing health care costs. Research shows that newest FDA approved diet pills Qysimia, and Blviq (lorcaserin), are helping to decrease obesity in the American population that were taking these medications. The new diet drugs approved by FDA will benefit Americans by decreasing obesity rates in the American population. With two-thirds of all our population being obese or overweight or and the related cost of health costs, FDA was under pressure to approve any weight loss treatments (Berkrot & Yukhananov, 2012). The Food and Drug Administration (FDA) permitted long-term weight loss obesity drugs for the first time in 13 years, these drugs are suppose to help unhealthy overweight and obese Americans with weight control that have been unsuccessful (FDA, 2012). These two new drugs, Belviq (lorcaserin) and Qsymia will be a tool to help Americans get and stay at a healthy weight (FDA, 2012). Belviq (lorcaserin) is one of the two new drugs that have been approved by the FDA. Resesearch currently showing promise and benefit from this medication. Belviq (lorcaserin) which drug’s efficacy submitted by FDA and Arena pharmaceuticals show a weight loss of five percent of their starting weight, averaging twelve pounds (Park, 2012a). Belviq (lorcaserin) works activating the brain receptors for serotonin which help to control appetite. Arena researchers explain that their drug is designed to seek out these appetite serotonin receptors and saturate them so that appetite is controlled. FDA and Arena pharmaceuticals show a weight loss of five percent of their starting weight, averaging twelve pounds. The best results have been shown in people that are on a healthy diet and an exercise program (Park, 2012a). FDA has approved this medications for obese patients with a BMI of 30 or above, or if a BMI of 27 and high cholesterol, hypertension or Type 2 diabetes. Side effects associated with this medication are fatigue, dizziness, dry mouth, constipation, headache and nausea; side effects for diabetic patients are fatigue, low blood sugar, headache, back pain and cough. The standard labeling for Belviq suggests that the drug be terminated in patients who fail to drop 5 percent of their body weight after 12 weeks of therapy, because they will probably not start achieving weight loss. When Belviq is given 10 milligrams twice a day, Belviq does not appear to activate the serotonin 2B receptor, which is what caused the withdrawal of fenfluramine and dexfenfluramine drugs because of cardiac issues. (Yao, 2012). The weight loss proven in research from this drug proves that Bekviq (lorcaserin) that will helped decrease the obesity in the American population that are prescribed this medication. A second new drug Qsymia, made by Vivus, is has been approved by FDA closely behind Belviq. Qsymia which drug’s efficacy in trials show a weight loss of 8.4 -10.6 percent of their starting weight. (2012b). This drug is a combination drug, topiramate, and phenertermine. Phentermine is an appetite suppressant stimulant, and topiramate is an anti-seizure medication that makes gives people the feeling of being fuller after eating. Research suggests that it works by targeting brain receptors that trigger eating too much. With clinical trials, obese patients that took Qsymia for a full year lost on average 8.4 % to 10.6% of their weight, the weight loss increased with higher doses. The FDA’s approval of Qsymia, after such a long diet-drug drought and despite the potential safety problems that plague weight-loss pills, marks a willingness to make new solutions available. FDA approved this drug for obese people with a BMI of thirty or greater or twenty-seven or more with another co-morbidity disease. Risks or side effects include increased heart rate, birth defects for pregnant women, and metabolic acidosis. With the American population increasing in obesity by over a third of the adults and effective weight loss treatments are few and rare. FDA approving these new weight loss pills shows us that new solutions are available (Park, 2012b). The weight loss associated with this drug is greater than that of Belviq but the potential complications and risk may be greater. FDA approving these two new drugs Qysmia and Belviq after a 13 year gap in FDA diet drug approval is promising to Americans, both drugs shows a substantial weight loss in obese patients with BMI of 27 or greater. This weight loss will be effective in decreasing obesity in the American population. These drugs are supposed to help unhealthy overweight and obese Americans with weight control that has been unsuccessful (Yao, 2012). Belviq (lorcase-rin) is a 10 mg tablet taken twice a day that works by sending signals to the brain that controls hunger. Weight loss from Belviq in studies averaged 3-3.7 percent. Qsymia is taken once a day, with patients starting at the lowest dose (3.75 mg phentermine/23 mg topira-mate extended-release), then increas-ing to the recommended dose (7.5mg/46 mg). The maximum dose increased to the highest dose (15 mg/92 mg). Weight loss from Qsymia in studys averaged 6.7-8.9 percent. Orlistat is the last FDA approved drug on the market currently. Prescriptions approved by FDA in the past have a history being removed because of detrimental side effects (FDA, 2012). A new solution for weight loss is necessary to help decrease the obesity epidemic in the United States and the FDA’s approval of Qsymia and Belviq, is the a start to answering how Americans can make weight loss being accessible (Park, 2012a). The two new diet drugs, Qysmia and Belviq approved by FDA will benefit Americans by decreasing chronic diseases associated with obesity in the American population. Conditions associated to obesity include heart disease, stroke, type 2 diabetes and certain types of cancer, some of the leading causes of preventable death. (CDC, 2012). Decreasing obesity will decrease the amount and or severity of these chronic. Obesity is defined as an adult with a BMI (Body Mass Index) greater than 30 and overweight is defined as BMI of 25- to 29.9 or greater. In 2009-2010 37.5% of the American population was obese according to data from the National Health and Nutrition Examination Survey (Ogden, Carroll, Kit & Flegal, 2012). BMI is not a diagnostic tool. For example, if a person has a high BMI, a health care provider would need to perform further assessments to determine if the excess weight is a health risk. These assessments might include evaluations of diet, physical activity, family history, blo od tests and other appropriate health screenings (CDC, 2011). With over one third of Americans being overweight it increases the chronic illnesses of over one third of our population. Almost 41 million women and more than 37 million men aged 20 and over were obese in 2009–2010. Obesity leads to higher health risks and chronic diseases including type two diabetes, hypertension, and increased lipids to name a few. Adults aged 60 and over were more likely to be obese than younger adults. The Healthy People 2010 goals of 15% obesity among adults and 5% obesity among children were not met (Ogden, Carroll, Kit & Flegal, 2012). Decreasing obesity rates will decrease our chronic illnesses associated with obesity. . An effective obesity prevention strategy will be to include education and change policies to incorporate healthy changes to decrease obesity. According to an analysis in the American Journal of Public Health, as little as a 5 percent reduction in the prevalence of diabetes and hypertension would save almost $25 billion annually in med ium-term health care costs (Hammond, 2012). Sixty percent of the Americans obese or overweight population reported one or more chronic illnesses that were associated with obesity, in 2006, compared to 33 percent of normal-weight adults. Cardiovascular disease is one of the major risks associated with obesity. The excess fat associated with obesity raises cholesterol and blood pressure. Decreasing the excess fat will decrease cardiovascular disease. Cancer over the last decades has been linked to obesity, decreasing obesity will decrease some of the cancer risks. Type II diabetes is the one chronic disease mainly associated to obesity, and studies suggest that a weight gain of 11 pounds or more in adult aged patients is associated with 27 percent of type 2 diabetes (Combs, 2011). Decreasing weight of 11 pounds which is a possibility for patients on these diet drugs will decrease these chronic illnesses. The new approved diet pills help decrease chronic diseases associated with obesity as evidenced by decreased chronic illnesses being present in lower weighted Americans The new diet drugs approved by FDA will benefit Americans by decreasing health care cost associated with obesity in the American population. This obesity epidemic is associated with increased health care costs and will continue to increase over the next years. Prevention of obesity along with investing in research is necessary for us to see a change in the obesity epidemic (Hammond, 2012). Obesity cost health care large amounts of money and is a health concern (Berkrot & Yukhananov, 2012). The abstract â€Å"Annual medical spending attributable to obesity† connects the unquestionable connection between growing rates of obesity and escalating medical spending. The liability of obesity has escalated to almost ten percent of all medical spending and could amount to $ 147 billion in 2008 these are the overall estimates that the authors found (Finkelstein, Trogdon, Cohen & Dietz, 2009). As a result, the article will be useful to support the points that decreasing obesity will decre ase health care costs. Obesity rates have continued to escalate despite all aspects of government’s efforts including state, national and local. This is a concern to the American public and also to the health care industry. The medical charges increased by 37 percent from 1998 to estimated 2006 numbers. The rising number of Americans with obesity is influencing the increases in total medical costs. Amplified costs is evidenced by prescription drug benefits from Medicare, that show Medicare overweight recipients spend $600 per year more than non obese Medicare recipients. The authors estimate that the occurrence of obesity being on the rise is to blame for the greater than before health care costs from 1998 to 2006 (Finkelstein, Trogdon, Cohen & Dietz, 2009). These numbers show again that reduction in obesity rates will decrease all medical costs including the $600 Medicare costs. Methods and Study data points are used for research in this article. This article goes over the methods used in the research. The methods used are a four part equation regression approach to predict the total medical spending. This is part of the modifications to allow stratifications to be more detailed , by separate spending from inpatient to outpatient settings, prescription costs of drugs, each service then was able to conclude and predict total spending (Finkelstein, Trogdon, Cohen & Dietz, 2009). The methods include accounting for Body Mass Index (BMI), BMI greater than 30 was used. Regressions for characteristics included control of ethnicity/race, age, income, smoking status, marital status, and insurance variables. Running separate models for each payer. Each type of service calculated from total predicted spending for obese patient had they be calculated to normal weight using bootstrap method. Also using obesity prevalence increase by computing the difference in these from 2006 back to 1998, shows hypothetical obesity costs and attributable to 2006 (Finkelstein, Trogdon, Cohen & Dietz, 2009). All this shows us that decreasing obesisty will decrease the cost of health care. Results of the first exhibit show obese persons had medical increase spending that was 42 percent larger ($1429/per person) then non obese persons. Results of the second exhibit that show costs estimates by payer show Medicaid increase of forty-seven percent, private insurance increased by fifty-eight percent and Medicare costs increased by 36 percent. Exhibit three type of service shows prescription drug increase from sixty percent to eighty-one percent, Inpatient increase from 4 percent to ninety percent and outpatient increase from fourteen percent to forty percent. Exhibit four shows medical spending attributable to cumulative obesity shows increases on all spending , this show that if obesity would have remained the same prevalence from 1998 we would have shown 47 billion spent in 2006 instead of 86 billion. These results imply that the eighty-nine percent of the spending was accounted by the obesity numbers rising (Finkelstein, Trogdon, Cohen & Dietz, 2009). This is a significant amount of money in all the exhibits. The authors provide evidence and statistics that support the argument that obesity increases the cost of health care and that reduction in obesity will in turn decrease the cost of health care. The article provides results and also explains the new evidence of the important role of prescription drug spending, in increasing the costs of obesity. The main message of this article obesity will continue to inflict major expenses on the health system for the upcoming years, without a solid and persistent decline in obesity prevalence. Although pharmaceutical, medical, and surgical interventions to treat obesity are available, these treatments remain rare.. Pharmaceutical is one of the three types of interventions we use to treat obesity. Pharmaceutical treatments are remaining rare in treating obesity. If not for obesity, total obesity costs would be much more reduced, along with the cost for other conditions caused by excess weight in our population (Finkelstein, Trogdon, Cohen & Dietz, 2009). This article discusses it limitations. A limitation of this source is that, though the page has credibility the authors do cite the limitations of this analysis being that the dependence of height and weight being reported is done by individuals. And the regressions of sample from 1998 is only half that of 2006 sample. This approach does not allow for precise diseases or behaviors connected with obese individuals (Finkelstein, Trogdon, Cohen & Dietz, 2009) Workers all over the world are experiencing cost increases to health care because of obesity. Employers estimated costs of health care decrease with decrease in weight (CDC, 2011). Total obesity costs would be much more reduced, along with the cost all chronic diseases and conditions caused by excess weight in our population (Finkelstein, Trogdon, Cohen & Dietz, 2009). The newest FDA approved diet pills benefit us by decreasing obesity for the American population that takes this medication. American obesity has been evidenced by studies that show a measurable weight loss. The new approved diet pills Qysimia and Belviq will decrease chronic diseases associated with obesity as evidenced by decreased chronic illnesses being present in lower weighted Americans (even a few pounds changes many chronic illnesses assosciated with obesity. Decreasing obesity will decrease health care costs as evidenced by costs decreasing by $1429 per person less on non obese patients (Finkelstein, Trogdon, Cohen & Dietz, 2009). Research data given in above essay suggests that the newest FDA approved diet pills will benefit Americans by decreasing obesity, decreasing chronic diseases associated with obesity and decreasing health care costs. The thesis has been proven to be correct, with the above information. Research showed that the newest FDA approved diet pills does benefit Americans by decreasing obesity, decreasing chronic diseases associated with obesity and decreasing health care costs. References Berkrot, B., & Yukhananov, H. (2012). Fda oks first obesity drug in 13 years. Retrieved from http://www.reuters.com/article/2012/06/27/us-arena-obesity-idUSBRE85Q1AA20120627 CDC. (2011, October 06). Cdc. Retrieved from http://www.cdc.gov/leanworks/costcalculator/index.html CDC. (2012, August 13). Cdc. Retrieved from http://www.cdc.gov/obesity/data/adult.html Combs, S. (2011). Retrieved from website: http://www.window.state.tx.us/specialrpt/obesitycost/pdf/GainingCostsLosingTime.pdf FDA. (2012). Retrieved from website: http://www.fda.gov/downloads/ForConsumers/ConsumerUpdates/UCM312391.pdf Finkelstein, E., Trogdon, J., Cohen, J., & Dietz, W. (2009). Annual medical spending attributable to obesity: Payer-and service-specific estimates. Retrieved from http://content.healthaffairs.org/content/28/5/w822.full.pdf html Hammond, R. A. (2012). Obesity, prevention, and healthcare costs. Retrieved from http://www.brookings.edu/research/papers/2012/05/04-health-care-hammond Ogden, C. L., Carroll , M. D., Kit, B. K., & Flegal, K. M. (2012). Retrieved from National Center for Health Statistics for Health S website: http://www.cdc.gov/nchs/data/databriefs/db82.pdf Park, A. (2012, June 28).

Harnischfeger Corporation

Financial Reporting & Analysis April 19th, 2013 Case Study- Harnischfeger Corporation 1. Describe clearly the accounting changes Harnischfeger made in 1984 as stated in Note 2 of its financial statements. The accelerated depreciation method was changed from to straight-line on all company assets that caused to increase after-tax net income for 1984 by $11. 005 million. The cumulative effect of change in 1984 there will be no reduction in the depreciation expense due to change. in 1984 decreased by $7. 0 million over the previous year.Most of this reduction was a result of the company's agreement with Kobe Steel, Ltd. Under this agreement, Kobe agreed to reimburse Harnischfeger up to $17. 0 million dollars of R;D expense over a period of three years. However, some students argue that Harnischfeger may be cutting its research budget since the actual reduction in Harnischfeger's    1984 R&D expense is more than one-third of this amount. (See Exhibit 4, Notes 6 and 9, in the case. ) 8 . Effective 1984, Harnischfeger began to include in its net sales products purchased from Kobe Steel, Ltd. , and sold to third parties by Harnischfeger.Previously only the gross margin on Kobe-originated equipment was included in Harnischfeger's financial statements. This increased Harnischfeger's sales in 1984 by $28. 0 million but had no impact on its profits. Some students would mistakenly argue that this had an impact on Harnischfeger's net income. (See Exhibit 4, Note 2, in the case. ) Although some of the above are pure accounting decisions with no direct cash-flow consequences, the other decisions affect the company's reported profits as well as its cash flow. The instructor should ask the class to identify the latter-type decisions among the above.Discussion of Question 2 The above analysis shows that most, if not all, of the reported profits of Harnischfeger in 1984 are produced by accounting changes. Therefore, the accounting changes helped the management report a signific ant profit rather than a modest loss. The instructor should point this out to the class and ask: Why do you think the management of Harnischfeger made these accounting changes? Students point out a number of possible motives for the accounting changes: 1. Boost the company's stock price so that the company could raise new capital, 2.Meet the earnings targets of the company's top management compensation plan, 3. Avoid the violation of debt covenant restrictions, and 4. Improve the company's image with the customers, dealers, and prospective employees. Some students argue that the analysis in Question (1) shows that it is too complicated for an average investor to â€Å"see through† the impact of all the accounting changes. They further point out that, even if many analysts recognize the effect of the company's accounting decisions on the 1984 profits, it is quite unlikely that the analysts would be able to assess the impact of these changes in future years.Other students are l ikely to argue that the market processes the reported profit numbers efficiently. They argue that there are some sophisticated analysts who could perform the analysis that was done in the class. The instructor should encourage this discussion. At some point in the discussion, the instructor should intervene and summarize the evidence from the research literature: 1. There is considerable evidence in finance and accounting literature that shows that the capital markets are generally efficient. 2.For stock prices to reflect reality in an unbiased manner, it is not necessary that everyone in the market has to process the information correctly. As long as there are some sophisticated investors who can â€Å"see through† the company's accounting changes, the stock price will reflect this due to the possibility of arbitrage by these investors. 3. The accounting studies that examine the stock market reaction to accounting changes conclude that the market is not fooled by the account ing decisions of firms. However, the evidence presented in these studies is not conclusive.Also, these studies do not examine whether the stock market recognizes the recurring effects of accounting changes. Without additional research, it is difficult to make conclusive statements on this issue. 4. Even if capital markets see through the effects of accounting changes, managers may believe otherwise in making accounting decisions. This is likely to happen if there are no significant penalties associated with such behavior. Even if investors fully recognize the impact of Harnischfeger's accounting decisions, there are other reasons for the company's managers to make these decisions.As Exhibit 2 in the case indicates, the top management of the company is awarded significant bonuses based on the company's reported profits. This provides an incentive for the managers to boost profits through accounting changes. However, if the compensation committee of the company's board of directors re cognizes this possibility, the committee could adjust the reported profits before awarding management bonuses. The instructor should challenge the students by asking: If investors can see through these changes from public information, why can't the board do it, especially when it has access to additional information in the firm?The third possible motive that is mentioned by the students is the desire of Harnischfeger's management to avoid the violation of debt covenant restrictions. Since the company recently experienced the painful consequences of violating these restrictions, it is plausible that the management changed the accounting policies to avoid future violations of the debt restrictions. If debt covenants are specified in terms of accounting numbers, managers have an incentive to choose accounting policies to minimize the violation of the covenants.However, if lenders recognize this possibility, lending agreements would be modified to avoid this possibility as long as the c ost of such a modification is not significant. The fourth possibility is that the accounting decisions are motivated by a desire to convince the company's customers, suppliers, dealers, and employees that Harnischfeger is again back on track and is viable. Given the nature of the company's products, a lack of confidence in the company's viability is likely to impair the company's ability to sell its products.In fact, the company was negotiating long-term contracts in 1984 with the governments of Turkey and China. It is quite possible that the company's return to profitability might have helped the management in this respect. Similarly, the company's ability to attract and retain talented employees might have been helped by the image that the company was back on track. During my visit to the company, Harnischfeger's management pointed out one additional factor in the company's accounting decisions: the role of internal management considerations.The company used the same set of accoun ting rules for external reporting and for internal management accounting. The company's product pricing was based on fully allocated product costs, and therefore its accelerated depreciation policies apparently caused its products to be overpriced relative to competition. In addition, the higher depreciation charges led to increased capital reinvestment demands from its divisions for maintaining and replacing the company's fixed assets.The company's management mentioned three principal reasons for its accounting decisions: (1) a belief that the external users of accounting data did not adjust for Harnischfeger's conservative financial reporting when comparing the company's performance with other companies in the industry, (2) the unpleasant experience with its debt covenant restrictions, and (3) the interaction between management accounting and external reporting. These reasons are discussed in greater detail in my paper, â€Å"The Anatomy of an Accounting Change. â€Å"Underlying all the accounting changes was a reporting philosophy outlined by the then chief financial officer and the current president of the company: In accounting there is no such thing as absolute truth. The same underlying reality can be accounted for using a range of assumptions. The earlier philosophy of this company was to choose the conservative alternative whenever there was a choice. Now we have decided to change this. We would like to tell the world that we are alive and well. We wish to tell the truth but do not want to be overly conservative in doing so.When the outside world compares our financial performance with that of other companies, they may or may not take the time and effort to untangle the effects of the differences in financial policies that various companies follow. My own belief is that people adjust for the obvious things like one-time gains and losses but have difficulty in adjusting for ongoing differences. In any case, these adjustments impose a cost on the user . If people adjust for the differences in accounting policies when they compare us with other companies, then it should not matter whether we follow conservative or liberal policies.But suppose they do not adjust. Then clearly we are better off following the more liberal policies than conservative policies. I am not sure whether people make the adjustments or not, but either way we wish to present an optimistic version of the picture and let people figure out what to do with the numbers. As a company you have to put the best foot forward if you want to raise capital, convince customers that you are a viable company, and attract talented people to work for the company. I feel that the financial reporting should help rather than hinder the implementation of our operating trategy. In my opinion, the changed accounting format highlights the effectiveness of our strategy better than the old policies do. The instructor can sum up the class discussion on question (2) by mentioning the view s of the management described above. Discussion of Question 3 After completing the analysis of Harnischfeger's accounting policy changes, the class should be asked to assess the company's future. At this point, I go back to my original question to the class, namely, â€Å"Is it worthwhile to invest in the company's stock in early 1985?    I call on a student who considers the company's stock a good investment and ask him or her to explain why. Harnischfeger's turnaround strategy consists of four elements: (1) changes in top management, (2) cost reductions to lower the company's break-even point, (3) reorientation of the company's business, and (4) restructuring the company's finances to facilitate the implementation of the reorientation strategy. The changes in the top management seem to be good. The new chief executive officer (CEO) has considerable experience in Harnischfeger's industry.The new CEO demonstrated his credibility with the financial community by successfully negoti ating with the company's lenders to restructure the company's debt. The new management has taken several steps in the right direction. The company's cost-reduction programs seem to be paying off. These programs were helpful in reducing the company's losses in 1984. The financial management of the company also seems to be sound. The cost-reduction programs and the pension restructuring have improved the company's cash flow.The total cash-flow analysis, shown in Exhibit 1, indicates that the company has been able to generate positive cash flow from its operations in 1984. The company raised substantial new capital through a public offering of debentures and common stock and used the proceeds to pay off all of the company's restructured debt. Finally, the company's business strategy seems to be sound. The management recognized the potential to exploit the company's strength in the material handling equipment business.Through its Harnischfeger Engineers subsidiary, the company planned t o expand in this area and concentrate on the high margin â€Å"systems† business. This strategy is likely to help the company to move away from the mining and construction equipment business, which is a low-growth and cyclical industry, to a higher-growth and more stable business. Students who are optimistic about the company's future cite the above factors as the reasons for their support for the company and its management.They argue that these factors indicate that the company's new management has the right ideas and knows how to turn the company around. These students suggest that the management's accounting decisions were part of its attempt to implement the company's strategy and are therefore constructive. The instructor should wrap up the case discussion by reviewing the company's motives for its accounting decisions. The instructor should point out that understanding these motives is essential for an analyst who is interested in assessing the company's current perform ance and its future potential.The instructor may end the class by taking a second vote on the investment potential of the company's stock and sharing with the class the subsequent events described below. SUBSEQUENT DEVELOPMENTS The following events describe the developments subsequent to the time of the case. As can be seen, Harnischfeger seems to have succeeded in implementing its strategy effectively. Also, the company continued to liberalize its financial reporting policies. 1985 1. The company changed its accounting for duration patterns and tooling. Previously, the cost of the patterns and tooling was expensed in the year of acquisition.Under the new method, these costs are capitalized and amortized over their estimated useful lives. 2. Harnischfeger reported a net profit of $0. 74 per share for fiscal 1985. The accounting change described above contributed $0. 24 per share to the reported profits. 3. The company raised $147 million by issuing preferred stock. 1986 1. Mr. Goess el was appointed as the chairman and CEO of the company, and Mr. Grade was appointed as the president and chief operating officer (COO). Previously, Mr. Goessel was the president and COO, and Mr. Grade was the CFO. 2.Harnischfeger acquired Beloit Corporation, a producer of papermaking machinery and systems, for $175 million in cash. Later in the year, stock equivalent to a 20% equity interest in Beloit was sold to Mitsubishi Heavy Industries, Ltd. , for $60 million in cash. 3. The company acquired Syscon Corporation, a firm based in Washington, DC for $92 million in cash. Syscon developed advanced computer systems for military markets. 4. Harnischfeger announced a plan to sell the company's Construction Equipment Division for approximately $17 million in cash and $55 million in debentures. . The company reported that Harnischfeger Engineers received a major order for the design of an automated car assembly plant. 6. Harnischfeger reported a net loss of $1. 14 per share for fiscal 19 86. This consisted of a profit of $2. 15 per share from continuing operations, a loss of $4. 45 per share from discontinued operations (Construction Equipment Division), and a gain of $1. 16 per share from the adoption of the new pension accounting rules. 1987 1. Harnischfeger received a takeover offer from Columbia Ventures, Inc. , for $19 per share in cash.The company considered the offer inadequate and rejected it. Exhibit 1 Total Cash-Flow Analysis ($ in thousands) |                                                                                                          |1984                         |1982                         |1981                         | |                                                                                                          |                               |                               |                               | |Working capital from operations                                                          | $ 2,961                   | $ 1,763                   | $ (55,902)             | |(Increase)/decrease n accounts receivable                                           |(23,908)                   |(5,327)                   |42,293                      | |(Increase)/decrease in inventories                                                       |9,282                      |56,904                      |26,124                      | |(Increase)/decrease in refundable income taxes and related interest    |                               |                               |                               | |                                                                                                          |11,289                      |(2,584)                   |(6,268)                   | |(Increase)/decrease in other current assets                                        |259                         |10,008                      |(439)                      | |Increase/(decrease) in accounts payable                                              |16,488                      |(1,757)                   |(3,302)                   | |Increase (decrease) in employee compensation and benefits payable       |                               |                               | |                                                                                                          |698                         |(15,564)                   |(3,702)                   | |Increase/(decrease) in accrued plant closing costs                               |(3,888)                   |(14,148)                   |20,496                      | |Increase (decrease) in other current liabilities                                  |    (3,181)                |    (15,927)                |    (3,030)                | |Cash from operating cycle                                                                   | $ 10,000                | $ 13,368                | $ 16,270                | |Minus plant and equipment additions                                                    |    (5,546)                |    (1,871)                |    (10,819)                | |Cash before dividends, investments, and    external financing                |                               |                               |                               | |                                                                                                          |$ 4,454                   |$ 11,497                   |$ 5,451                   | |Minus cash dividends                                                                   à ‚         |    0                         |    0                         |    (2,369)                | |Cash before investments and external financing                                     | $ 4,454                   | $ 11,497                | $ 3,082                   | |Minus advances to unconsolidated companies                                           |(2,882)                   |0                            |0                            | |Plus other                                                                                           |    269                      |    1,531                   |    848                      | |Cash before external financing                                                             | $ 1,841                   | $ 13,128                | $ 3,930                   | |                                                                                                          |                               |                               |                               | |External Financing:                                                                            |                               |                               |                               | |                                                                                                          |                               |                               |                               | |Proceeds from senior notes and subordinated                                        |                               |                               |                               | |Debentures                                                                                           |$ 120,530                |$ 0                         |$ 0                         | |Conversion of export and factored receivable sales to debt                   |                               |                               |                               | | 0                            |23,919                      |0                            | |Restructured debt                                                                               |0                            |158,058                   |0                            | |Debt replaced, including conversion of    receivable sales of 23,919       |                               |                               |                               | |                                                                                                          |0                            |(158,058)                |0                            | |Repayments of debt                                                                               |(161,500)                |(760)                      |(9,409)                   | |Increase (repayment) of short-term bank notes payable                         |2,107                      |(3,982)                   |(2,016)                   | |Other increases in debt                                                                      |1,474                      |0                            |25,698                      | |Issuance of common stock                                                                      |21,310                      |0                            |449                         | |Issua nce of common stock warrants                                                       |6,663                      |0                            |0                            | |Salaried pension assets reversion                                                       |    39,307                   |    0                         |    0                         | |Cash from external financing                                                                | $ 29,891                | $ 19,177                | $ 14,722                | |Net increase (decrease) in cash    and temporary investments                   |                               |                               |                               | |                                                                                                          |$ 31,732                   |$ 32,205                   |$ 18,652                   | 2. What is the effect of the depreciation accounting method change on the reported income in 1984? How will this change affect profits in future years? It increased the net income to $11 million for 1984 or $. 93 per common and common equivalent share. The straight-line method will allow the assets to continue to depreciate in the same amount for the life of the asset.This change will increase profit in future years even thought the depreciation expense in strait-line will be higher that would’ve been with accelerated method. 3. What is the effect of the depreciation lives change? How will this change affect future reported profits? As a result of going t o strait-line the company also has changed its estimated depreciation lives on certain U. S. plants, machinery and equipment and residual values on certain machinery and equipment, which increased net income for 1984 by $3. 2 million or $. 27 per share. No income tax effect was applied to this change. This change should report higher profits in the coming years. $3. 2 million or $. 27 per share. No income tax effect was applied to this change. This change should report higher profits in the coming years. 4.The depreciation accounting changes assume that Harnischfeger’s plant and machinery will last longer and will lose their value more slowly. Given the business conditions Harnischfeger was facing in its primary industries in 1984, are these economic assumptions justified? Not necessarily, they can not fully predict the outcome of these changes but history shows them that as long as their plant machinery are more up to date production will perform at a better rate which shoul d lead to valuable resources needed to conduct good business. 5. In Note 7, Harnischfeger describes the effect of LIFO inventory liquidation on its reported profits in 1984.Describe what is meant by LIFO liquidation and how liquidation affects a company’s income statement and balance sheet. By LIFO liquidation means when a company’s accounting sells its oldest inventory since the current sales are higher then current purchases then the liquidation will occur, meaning that older inventory will be sold. The effect of the LIFO liquidation on the company’s income statement is an increase in net income by $2. 4 million or $. 20 in fiscal year 1984. There is no income tax effect. On the balance sheet there is a decrease of inventory, due to liquidation. 4. The depreciation accounting changes assume that Harnischfeger’s plant and machinery will last longer and will lose their value more slowly.Given the business conditions Harnischfeger was facing in its primary industries in 1984, are these economic assumptions justified? They cannot fully predict the outcome of these changes but history shows; however, we know they were experiencing a drop in sales this would also mean that they were giving less use to their machinery, and that would cause less wear and tear to the machinery justifying and increase on the useful life of the asset. 5. In Note 7, Harnischfeger describes the effect of LIFO inventory liquidation on its reported profits in 1984. Describe what is meant by LIFO liquidation and how liquidation affects a company’s income statement and balance sheet.The liquidation means selling of older inventory since the current sales are higher then current purchases then the liquidation will occur and as result any inventory not sold in previous periods must be liquidated. The company will benefit by an increase in net income by $2. 4 million or $. 20 in fiscal year 1984. Meaning that the net loss of previous year 1983 was reduced by a pproximately 15. 6 million. The balance sheet would have decrease of inventory from 12. 6 mil in 1983 to 5. 5 mil in 1984. 6. Note 8, states Harnischfeger’s allowance for doubtful accounts. Compute the ratio of the allowance to gross receivables (receivables before the allowance) in 1983 and 1984.What would the allowance have been if the company maintained the ratio at the 1983 level? How much did the pre-tax income increase as a result of the changed ratio in 1984? The company's provision for doubtful accounts receivables as a percentage of total receivables was 8. 4% in 1984. The corresponding percentage in 1983 was 11. 3%. If the company maintained the same percentage provision in the two years, the bad debt expense in 1984 would have been $1. 5 million more than the reported expense. 7. Note 9, page 216, states that Harnischfeger decreased R&D expense in 1984 relative to the previous two years. Do you think this change was motivated by business considerations or accountin g considerations?How did this change affect the company’s reported profits in 1984? Also R&D expense in 1984 decreased by $7. 0 million over the previous year. Most of this reduction was a result of the company's agreement with Kobe Steel, Ltd. Under this agreement, Kobe agreed to reimburse Harnischfeger up to $17. 0 million dollars of R;D expense over a period of three years plus the company was reduced in its size so there was no need to that big expenditures on R;D. 8. Note 11, describes a number of changes in Harnischfeger’s pension plans in 1984. Describe these changes as clearly as you can. What are the economic consequences of these changes to Harnischfeger and its workers?The reduction in benefits and wedges were significant from 1982 to 1984. In 1984 the pension expenses accounted for 1. 9 million, 1983 for 6. 5 million and 1982 for 12. 2 million The change in the return on investment assumption is for all US plans. The economic consequence is that there will be less expenditure made by these pension owners during the lifetime of their pension. The company established a new plan, which goal was an improvement in the minimum pension benefit. This constituted in a restructure of the Salaried Employees’ Retirement Plan. From one side that decision could help the company to rebuild the trust of customers and suppliers for continuing in business.From the other side, the workers would suffer a significant economic lost and could lose the motivation to work for the company. But there is a possibility that a positive view could emerge because they could appreciate the company’s efforts to keep them working there, and then cooperate to take the company to the next level. 9. How did the pension plan changes affect Harnischfeger’s financial statements in 1984? Are these changes likely to affect future profits? The effect of the changes in the investment return assumption rates for all U. S. plans, together with the 1984 restruc turing of the U. S. Salaried Employees' Plan, was to reduce pension expense by approximately $4. 0 million in 1984 and $2. million in 1983, and the actuarial present value of accumulated plan benefits by approximately $60. 0 million in 1984. This may have an effect on future profits. The pension plan changes affected positively the statements in 1984. Less assets were available for benefits; therefore, more income was reflected in the financial statements, which contributed to the cash to pay debt obligations. Furthermore, if reducing the debt, company could recover the banks and shareholder’s trust. 10. Summarize all the accounting changes Harnischfeger made in 1984, and their effects on pre-tax profits and cash flows in 1984. 1. Change in the recognition of some types of sales. This resulted in a change in sales calculation.Harnischfeger incorporated products purchased from Kobe Steel, which were re-sold by the company, into its net sales. This increased aggregate sales and cost of sales by $28 million. The effect of the change in sales calculation was an increase in both aggregate sales and cost of sales by $28 million. Also, profit margin dropped from 1. 55% to 1. 44%, which represented a 7. 1% change in profit margin. 2. Change in the fiscal year for some foreign subsidiaries. By changing the fiscal year of foreign subsidiaries (ending period of September 30 instead of July 31), the effect was the lengthening of the 1984 reporting period for the subsidiaries from 12 months to 14 months.This increased sales by $5. 4 million. 3. Change in the depreciation methods on assets. The depreciation policy for financial reporting purposes was changed to a straight-line method from a principally accelerated method. The effect of the change in depreciation method (straight-line method) was a net income of $11 million realized in 1984. Overall, depreciation charges resulted in an increase of $3. 2 million in net income in 1984. 4. Change in the use LIFO liquidat ion in inventory valuation. The effect of LIFO inventory liquidation was an increase in 1984 net income by $2. 4 million, as gains. 5. Change in the allowance for doubtful accounts.The company adjusted its allowance for doubtful accounts to 6. 7% of sales for 1984 from 10% of sales in 1983. The effect of the change in the allowance for doubtful accounts was that it resulted in $2. 9 million in operating income for 1984. 6. Change in the R&D expenses. Harnischfeger significantly reduced its R&D expenses to $5. 1 million in 1984, from 412. 1 million in 1983. The effect of the change in R&D expenses was an increase in operating profit by $9. 1 million. 7. Change in employee pension plans. The effect of the change in pension plans was a reduction in pension expenses by $14 million and increase in net income by $3. 9 million, and a positive cash flow. 11.Accounting statements are used by investors, lenders, customers, employees, and governments in dealing with Harnischfeger. Among these groups, who is most likely to â€Å"see through† the above accounting changes, and who is least likely to do so? The least likely to â€Å"see through† the accounting changes are just normal people who don’t know accounting concepts because some methods of reporting can overstate or understate the numbers without a sustainable change so investors, lenders, and governments should be the ones to most likely â€Å"see through† the change and based on what they see they make a decisions. Employees in accounting, finance, and upper management should be able to â€Å"see through† the changes. 12.Are the accounting changes likely to help or to hinder Harnischfeger’s ability to implement its business plan? Be as specific as possible. Even thought the changes indicate an optimistic move, it does not guarantee that the company is going to be able to implement its business plan. The changes made strongly justify company’s boost in the periods an alyzed. From my point of view, company reflects a positive result on management through its financial reports. Basically the mission to satisfy shareholders and business related entities such as banks and suppliers was accomplished by showing the ability to overcome financial problems through management based on the financial statements.However, the accounting practice can be a matter of numbers’ convenience and it can be altered just to show easy actions. 13. Overall, what is your assessment of Harnischfeger’s future as of 1984? The company is taking a risk by expecting that the one-time boost in income and cash in 1984 will enable the company to successfully expand internationally and grow in new high tech areas and become profitable once again. They wanted to make their financial statements look pretty so that investors would buy their stocks and suppliers would continue giving credit for being able to produce product and sell. They need to stop playing with account ing methods and hiding the true story otherwise they will be in danger to not survive in a long run.

Business Law for Dick Smith

The Sydney Morning Herald, March 20, 2017 The Directors and the Executives of Dick Smith have been accused of mitting a breach of their directorial duty to exercise reasonable care after the pany has suffered financial collapse in January 2016. The former directors of the Dick Smith had to face legal action 14 months after the electronics chain was put into administration. Receiver brought a legal action against the directors and executives to recover losses worth $60 million as the directors failed to exercise reasonable standard of care and skill managing the pany’s inventory. The pany was alleged that its inventory purchasing decisions are based on maximizing rebates instead of demand of the customers which led to an increase in the redundant stock amounting to $180 million by October 2015. The excessive stock led the pany write off $60 million of inventory in November 2015. The directors were accused of inflating profits artificially in the 2015 financial year, as they were recoding rebates as profit. Although the directors denied that they made the purchasing decisions based on rebates, the chief financial officer of the pany admitted in court that the pany did adopt a strategy to enhance the earnings from rebates. The law firm defending the directors contended that the directors have always acted diligently, consciously and exercised reasonable care while carrying out the business operation of the pany. The issue that arises in the Dick Smiths case is that the directors have failed to exercise their statutory duty to exercise due care and diligence while carrying out the business operations of the pany. According to Section 180 (1) of the Corporations Act (Cth) a director was required to act with reasonable care and diligence. Under general law, whether a director had mitted a breach of his directorial duties is subject to the subjective assessment and depends largely on the director’s own knowledge and skill (Velasco 2014). However, in Re City Equitable [1925] the rule, the court held that in order to determine whether a director has violated his directorial duties, the objective test shall be applied where the director must establish that he has exercised reasonable care and diligence and had not mitted a breach of his duties. In Dick Smith’s case, the directors and the executives were alleged to have failed to place adequate systems to manage the supplier rebates and inventory of the pany. In ASIC v Healey [2011], the court held that the directors of the pany are under statutory obligation to be able to read and prehend the financial statements of the pany instead of simply relying on the fact that the systems are in place. Further, in Daniels v Anderson [1995], the Court of Appeal held that directors must prehend the nature of the duty that they are statutorily obligated to perform. Section 180 (1) of the Act further requires to impose an objective ‘reasonable person’ test in order to determine whether the director has exhibited hid duty of care and diligence in the manner as any reasonable person would exhibit under similar circumstances. ASIC v Healey & Ors [2011] FCA 717 JWS Daniels v Anderson [1995] 37 nswlr 438 Re City Equitable Fire Insurance Co [1925] Ch 407 Velasco, J., 2014. A Defense of the Corporate Law Duty of Care.

Advertising Campaign of McDonalds Case Study Example | Topics and Well Written Essays - 2500 words

Advertising Campaign of McDonalds - Case Study Example and social issues.First of all, there was a rapid upsurge of public interest to the healthy lifestyle,and together with this tendency there was one more - McDonald's was gradually becoming a symbol of unhealthy eating that causes problems with health and obesity.At the end of the XXth century, Atkin's Diet gained a great amount of adherents,and it also affected the reputation of the fast-food giant, as people were becoming increasingly more concerned as for the volume of fat and carbohydrates,and in number of calories in their everyday meals, and surely, Big Macs, hamburgers,soft drinks with lots of sugar and French fries proved to be 'champions' as far as the content of 'bad' calories was concerned.Though the companies that were competing with McDonald's could not boast to serve healthier food, yet because McDonald's was the most popular chain of fast food restaurants,it played a trick on the company making it a 'collective' symbol embodying all the negative sides of eating junk. It cannot be overlooked that with the world's businesses becoming global and the emergence of various anti-global movements that blame multinational corporations for exploiting people and affecting the economy of the developing countries, McDonald's has also become a symbol of 'the world's corporate evil' that attempts to 'catch' the entire planet into its 'vicious net'. In 2002, the American president G.W. Bush started an anti-obesity campaign that included propagating healthy food among schoolchildren and their parents, and in the course of this campaign the direct connection between eating junk food and obesity was being pinpointed. As a result, there was a significant decrease in the number of McDonald's customers, and many of its restaurants were closed. It was also stressed that there had been a decrease in the number of young people visiting McDonald's, and as soon as the company's analysts noticed that the ratio of teenagers and young people among their customers was decreasing, 'I'm lovin' it' advertising campaign was launched. Taking into account all the above said, this new advertising campaign was meant to enhance the image of McDonald's so that to deal with the crisis the company found itself in. In contrast to the 2001-2002 campaign that targeted mainly children and family audiences ('Happy Meal', Ronald McDonald, playgrounds for children, toys, balloons, birthday parties etc.), the new global task for McDonald's was to attract young people and teenagers. McDonald's advertising campaign whose slogan has become 'I'm lovin' it' was launched in 2003, and proved to be a significant breakthrough as far as the company's branding is concerned. This slogan

Streptococcus pyogenes Essay Example | Topics and Well Written Essays - 1000 words

Streptococcus pyogenes - Essay Example Most types need an enriched media (blood agar). They spread through respiratory secretions. In human- beings, Streptococci causing diseases generally occur in the respiratory tract, bloodstream or appear as skin diseases. If it is a respiratory infection, then its habitat would be the pharyngitis or tonsillitis but in case of a skin infection it occurs as pyoderma. Streptococcus Pyogenes creates inflammatory lesions at the portal of its entry which is most often the upper portion of the respiratory tract. At times it infects the lower respiratory tract and causes infections of the sinuses (sinusitis), or lungs (pneumonia) or the middle ear (otitis media), Streptococci are both useful as well as harmful. They are essential and are used as indicators of pollution and in various dairy and industrial processes. But beside its good side, it also has a dangerous side to it. Of all bacterial pathogens that attack humans, streptococcus A causes the most number of diseases. It is harmful and causes many significant diseases among which are – rheumatic heart, impetigo, scarlet fever glomerulonephritis, and pneumococcal pneumonia, bacteremia, meningitis, periodontal disease and pneumonia. For the past several decades scientists and researchers have focused their attention on two primary species which cause severe infections: They are - S pyogenes (group A streptococci) and S pneumoniae (pneumococci). Streptococcus pyogenes is a common and clinically important human bacterial pathogen causing a wide range of invasive and non-invasive disease, as well as non-suppurative sequelae. (Cunningham, M. W. (2000) Clin. Microbiol. Rev. 13, 470–511). This bacteria attacks the inner lining of the throat and is highly contagious. Symptoms include severe pain and redness of the throat. The patient experiences swelling within the throat and has difficulty in swallowing. This is accompanied by fever and uneasiness. It is very difficult to diagnose

Trust Situation paper Assignment Example | Topics and Well Written Essays - 750 words

Trust Situation paper - Assignment Example Not until this is achieved that one will receive an annual income from the fund. Before this time the trustee (may be a bank), manages the fund in a manner appropriate to the trust funds specifications. After this time, the beneficially will usually receive allowance may be for living expenses and or educational expenses (Matthews, 2006). A trust may be revocable or irrevocable. A revocable trust provides for any modification or termination without the permission of the beneficiary. After grantor, has transferred all or part of his assets into the trust, he as from that effect withdraws all his rights of ownership from the assets and the trust. Mr. Raymond has a recoverable Trust, this means that he can alter the terms of the trust or even terminate it without consultation with his children who are the beneficiaries of the trust. A recoverable trust allows the grantor to change the terms of the trust or take the property back at any time (Hayton, 2005). This is not in accordance with the interest of the beneficiaries, and therefore it raises concern to the children of Mr. and Mrs. Raymond. (2) In harmony with the terms of the agreement, the trustee will distribute benefits to the trust beneficiaries or as per the orders from the grantor who can at any time change the terms of the trust. The trustee (bank) as the holder of the property is all times required to act in the best motive of maximizing the trust benefits. This responsibility of loyalty to clients is referred to as a fiduciary obligation, and it places a high reliance standard of care and expectations upon the trustee (bank) (Matthews, 2006). The copies of the bank statements indicate that there have been massive withdrawals for the trust by Mr. Raymond although the trust investment has been positive. This can be attributed to the manner in which Mr. Raymond has been spending on the many trips he takes to visit his children and also for leisure overseas. When the trust funds are

Flexible Working Practices and Their Place in Todays Organizations Essay

Flexible Working Practices and Their Place in Todays Organizations - Essay Example This is the reason why companies need to focus on increasing employees’ satisfaction with their jobs. Provision of flexible work environment to employees is one of the main steps a company takes to increase employee motivation and satisfaction levels (Brenner, Fairris & Ruser 2004). In this paper, we will discuss some of the key flexible work practices that can make jobs attractive for employees. The paper will include a discussion on the way human resources can be managed so that employees become more motivated and satisfied with their jobs. 2. Flexible Work Practices Flexible work practices mean different things for different organizations. Some organizations think of flexible work practices as a way to establish a good working relationship between partners, customers, and shareholders, whereas some companies take flexible work practices as the ways to improve employee performance. Generally speaking, flexibility in doing job is all about the way an employer and an employee make changes to when, how, and in which way he/she will work to meet business and individual needs in a proper manner. Flexible work practices help companies in reducing workplace conflicts and employee turnover problems. As Batt and Valcour (2003, p. 189) state, â€Å"the most effective organizational responses to work-family conflict and to turnover are those that combine work-family policies with other human resources practices, including work redesign and commitment-enhancing incentives†. Flexible work practices refer to that type of flexibility that serves both employees and companies in accommodating individual needs (Avery & Zabel 2001, p. 139). Flexible work practice enables businesses as well as individuals to meet their respective needs by making appropriate changes to location (where), time (when), and manner (how) in which employers and employees carry out their job activities. â€Å"Flexibility should be mutually beneficial to both the employer and employee and result in superior outcomes† (Workplace Flexibility 2011). There is a number of flexible work practices that managers can carry out to make employees satisfied with their jobs. Some of those practices include flexible working hours, part-time work, variable year and part-year employment, motivation through recognition, facilitating remote working, job sharing, phased retirement, and flexible job hours. Allowing employees to work in ways that can help them balance their personal and professional life requirements easily is good for employees, as well as for businesses (Stredwick & Ellis 2005, p. 1). Let us discuss some of the main flexible working practices in detail to know how they contribute to improved employee and organizational performances. 2.1 Flexible Working Hours One of the best flexible work practices is to allow flexible working hours to employees (Pil & Macduffie 1996). Managers can schedule the working hours of employees in such a way that employees can feel rela xed. For example, they can change the work timings of 8am - 4pm to 9am – 5pm. Similarly, they can alter the scheduling of work timings to facilitate employees in doing their personal works. For example, they can make employees work for 10 hours a day and then give a 2 hours relaxation for the next day. In this way, the total number of working hours for employees will be the same as in normal case.

Human resource in acction Essay Example | Topics and Well Written Essays - 1250 words

Human resource in acction - Essay Example For example, if we go to the ‘Areas of Talent’ category, we find a list of sub categories which include the departments in which the jobs are opened, such as, call center, food and beverages, and human resources. Next, when we click on any of these links, all jobs related to the department are opened with detailed job responsibilities, as well as location of job and other requirements. However, the salary is not mentioned in any of the job openings which I would like the company to put against each of the jobs. I think the website does everything quite well in every aspect. For example, a user can obtain sufficient amount of information under each of the links included in the website. Moreover, the website is not heavy and takes the least amount of time to open any particular link regardless of the amount of text included in the webpage. As a manager, the only improvement that I would like to make for the website will be to include some colored texts at some places to ma ke the website a bit more attractive. At present, almost all of the text is written in black with white background. Addition of some colors will definitely give a more graceful look to the website. Company 2: Carlson The second company we are going to talk about is Carlson, which is the world’s most renowned travel and hospitality company. If we explore the website of the company, we find it more colorful and expressive as compared to the website described earlier. The website includes videos, pictures, and all such information that a user may wish to see. If we talk about the link to careers, we can say that the information included in this website about career opportunities is enough to meet user expectations. When I explored the link to careers, I found four more links which were did not find any information on the semi-static page which corporate careers, hotel careers, restaurant careers, and travel careers. I clicked restaurant careers because of my interest in this fie ld. I found a lot of links to the available job vacancies. However, I did not find job description for any of the job which I would like to be included against each job mentioned in the website so that users can know what activities they will have to do if they get the job. I think the website provides enough information about every aspect. Navigation is also easy but some pages really take some time to open which may be because of inclusion of some visual aids. One more thing that I did not like about the website was its inclusion of so many things in every webpage. The web developers for this website seem to have put more focus on inclusion of visuals and colors which have made this website a bit more complex for a new user. As a manager, I would like to make this website a little simple in order to provide ease to new users. Part 2 Methods of Recruitment Company: Hilton Worldwide Position: Director Brand Marketing Methods of Recruitment: 1. Internal Sourcing Internal sourcing mea ns creating existing employees aware of new job opportunities or publishing the information about job vacancies within the company. Some of the main advantages of using this type of recruitment for Hilton Worldwide will be no training costs for new employees, reduced advertising fees, time saving related to selection of candidates because of no need of background checks, increased employee dedication, and motivation for

Employee Empowerment in the Workplace Essay Example | Topics and Well Written Essays - 2500 words

Employee Empowerment in the Workplace - Essay Example Empowerment is seen as a process that results in individual employee enjoying autonomy while performing their jobs. This also ensures accountability on their part and thus develops a sense of ownership and increases the sense of fulfillment, while achieving shared organizational goals. Employee Empowerment has grown in importance in public administration. Early concern for employees as human resources and for the social aspects of work grew into the Quality of Work Life movement and such other efforts (e.g., McGregor 1960; Peters and Pierre 2000). The new public administration and the reinventing government movements have emphasized empowering employees (Marini 1971; Osborne and Gaebler 1992; DeWitt et al. 1994). Empowerment has become "one of the buzzwords of the hour" (Clark 1999, 5) (Lacerda Ramos Eduardo 1995). There were instances of efforts in stimulating employee empowerment in the history "Since World War II, the movement for worker empowerment has steadily gained momentum, c ertain countries have attempted (and in some cases sustained) experiments in various cooperative form of empowerment. With state support, the communal kibbutzim of Israel and Palestine have existed for over eight decades. In Latin America, major national trials in workers' ownership were initiated by the government in both Chile and Peru. In Europe, workers' firms came to constitute a major portion of Italian cottage industry, as well as French small- to medium-sized firms - especially in professional services such as printing, architecture, and engineering" (Lacerda Ramos Eduardo 1995). The present project work is an attempt to describe the importance of employee empowerment for employees as well as the organization. It takes an descriptive approach to illustrate the direct relationship between employee empowerment and their contentment and improved performance. Employee Empowerment- Meaning In common parlance, the term 'empowerment' refers to the process of enabling or authorizing an individual to think, behave, take action, and control work and decision making in autonomous ways. It is the state of feeling self-empowered to take control of one's own destiny. In the organizational context, this term is used with the term 'workers' to denote a changed work atmosphere where employees are at liberty to take decisions on their work and given the responsibility for the performance or otherwise at work place. In other words, employee empowerment is the process of granting the authority to employees with non-managerial capabilities to take decision in an autonomous way. Employee involvement and participative management are similar concepts used in the context of empowerment, but are not interchangeable. In fact, empowerment is the act of strengthening an individual's beliefs in his or her sense of effectiveness. In essence, then, empowerment is not simply a set of external act ions; it is a process of changing the internal beliefs of people (Conger and Kanungo, 1988). Individuals believe themselves powerful when they feel they can adequately cope with environmental demands-that is, situations, events, and people they confront. They feel powerless when they are unable to cope with these demands. Conger and Kanungo (1988) were among the first to define psychological empowerment. They described empowerment as

Boeing’s e-enabled advantage Essay Example for Free

Boeing’s e-enabled advantage Essay The Boeing Company is a major aerospace and defense corporation, originally founded by William E. Boeing in 1916 in Seattle, Washington. In 2004, it became one of the United State’s largest manufacturers with nearly 160, 000 employees and a net income of $1. 87 billion. It was the world’s largest aerospace company and for decades, had dominated the world’s commercial aviation market. THEIR STRATEGY Their main strategy was to streamline their core processes and to diversify. In streamlining their core processes, Boeing adopted simpler procedures for configuring aircraft to specifications, scheduling, ordering parts and managing inventory. They also diversified and entered into other markets, becoming more agile geographically and becoming less dependent on the highly cycled commercial jetliner market. They also integrated defense systems, Capital Corporation and the commercial airlines. HOW I. T. FACTORED INTO THAT In launching the aforementioned integration and innovative technologies, Boeing needed high end Information Technology expertise. That helped them launch a couple of websites including MyBoeingFleet. com. They also launched the Boeing Connexion and the Airplane Health Management (AHM). They went further and took great strides to understand both the airlines and the airline customers and integrate their business processes with Information Technology. This helped them provide broader services and is the main source of the e-enabled technology mentioned in the case study. This helped them plan and prioritize current and future processes effectively. THE MARKET Their market initially was the United States military which drove their technology but later grew to include commercial airliners. Their commercial airline market rapidly grew to 60% of the market world over and they appeared to have reached the pinnacle of the corporate might. As this happened, the only direction Boeing seemed to be headed was downward due to the emergence of big competitors. THEIR COMPETITION In the commercial airliner, Airbus seemed to be their biggest competition but because of all the technologies they integrated into their business, it was competing in segmented markets against industry giants like Oracle, IBM and Accenture as well as Garmin International and Aero Exchange International but their visionary leadership and their willingness to invest in technology sees them come out on top. THEIR WEAKNESS One of the main weaknesses of Boeing was their inablitiy to meet delivery schedules for airlines. Some airplanes they manufactured were also said to be inefficient but that did not stop them from producing more of those aircrafts which led to the belief that they are out of touch with their customers. Also, their frequent change of leadership could be considered a weakness as that makes them frequently go back to the drawing board to re-strategize.

Should Police Officers Wear Body Cameras?

Should Police Officers Wear Body Cameras? Abstract In recent years the amount of cases of police brutality has increased significantly. These officers have shown the public that those who are meant to protect us can also hurt us. Those who are supposed to uphold the law can also abuse it. In light of the recent Michael Brown incident the people have finally decided to make a stand against the police officers who believe that they are above the law. This was not the only case that things have escalated this bad before. There are many cases of police brutality that the public had rallied around and made the whole nation aware of the issue. The most recent case of Michael Brown has caused the biggest uproar in recent history. The people have proposed a new law to help fix this issue and it has picked up a huge following and it is demanding the attention of the White House. Introduction Authority has been abused since others were given power over the many. In many cases it is often government officials that have abuse their power in many nations, but in the USA we have the issue of the law enforcers not enforcing the law or enforcing it a little too much. Police brutality cases have been on the rise since the early 2000s (CATO Institute, 2010). We as a people have often ignored the fact that those who are supposed to be upholding the law often break it. As of 2014 we as a people have taken a stand against the rise in police brutality cases. The people have proposed a law, named the â€Å"Mike Brown† law, to try and prevent any more of these cases (Anonymous, 2014). This law proposed that law enforcers wear tiny personalized cameras that captures any sort of misconduct an officer practices while on-duty. Police brutality has become a prevalent issue in American society. In recent years, police brutality cases have come into the public eye. This exposition of these acts is not an uncommon occurrence. In 1992 Rodney King was publically assaulted by a police officer and this event was being publically broadcasted (Skolnick, 1994). This drew attention from the many people that lived in the area and caused a public uprising. These L.A. riots were showcased to the whole nation as a result of a single man being beaten by a police officer. It was at this point that man people across the nation became disgruntled by the injustice. Public uprisings are a devastating aftermath because a simple event, but tragic event resonated with many people. These cases of police brutality can explode into large bouts of anarchy as we saw in 1992. As the number of police brutality cases is on the rise, so it the probability of another devastating event such as the week long L.A. riots. A simple solution has been proposed to solve all of the issues presented by these violent acts. The â€Å"Mike Brown† Law The police use a tactic where they place unmanned vehicles along roads where speeders are common. The â€Å"Mike Brown† law is seemingly trying to mimic that tactic by using these individual police cameras to deter excessive force to arrest the suspect. The â€Å"Mike Brown† law proposes that funds be set aside, so that law enforcement officers (including federal officers) can be assigned cameras that capture the on duty activities of the officers wearing them. If any illegal or illicit activity were to be performed while the officer was on duty, then the â€Å"cop cam† would capture it all on camera and the court would have definitive evidence to put these corrupt law enforcers away. This law was inspired by the shooting of an unarmed eight-teen year old in Ferguson, Missouri. The initial incident was: a police officer had stopped two teens (one of them being Mike Brown) and told them to get down on the floor. Mike Brown had complied and was on his knees with hi s hands behind his head, pleading for the officer not to shoot. The officer was reported to have shot the unarmed teen at least 6 times. Michael Brown was murdered in broad daylight by a police officer. This is another case of police brutality has cause a large amount of civil disobedience and unrest. Police Brutality and Civil Unrest The unrest in Ferguson is only the most recent case of civil unrest due to an unjust act from a police officer. According to Todd C. Frankel (2014), the unrest in Ferguson, Missouri is only due to the recent buildup of mistrust between the people and the law enforcers. According to an interview between Frankel and Antonio French (2014), French has observed that the police have mishandled cases, especially cases dealing with predominantly black neighborhoods, and he believes that this is what the cause of all this unsettlement is. French had also stated that this explosion of anarchy has been bubbling up for a long time and this is true because this is not the only case of anarchy breaking out from a case of police brutality. Rodney King was all over the national news in 1992. He was not a star, he was not a rising celebrity, nor was he an artist of any kind. Rodney King was all over national television because he was brutally beaten by multiple police officers of the Los Angeles Police Department. This was the first real widely known case of police brutality. This was also the case that revealed just how brutal police can be. The majority of Americans were shocked because before this was publicized the police were often depicted as upstanding citizens on television and to watch them beat a mean nearly to death was an eye opener that was well needed to spark a change. After the police officers were acquitted of all charges, L.A. broke out into riots (Skolnick, 1994). These riots were actually considered â€Å"insurrections† because these acts were political instead of anarchic. The amount of people that took to the streets was massive. Many of the people that were taking part in this â€Å"insurrection† were actually brown instead of black. At this point this event was considered to be a multiracial affair because there was many races involved including the Asian population. These people were taking a stand against the racial issues of the area and this is what is happening currently in Fergusson, Missouri. References Simmons, K.C. (2008). The Politics Of Policing: Ensuring Stakeholder Collaboration In the Federal Reform of Local Law Enforcement Agencies. Journal of Criminal Law Criminology, 98 (2), 489-546. Skolnick, J. (1994). No way to delay, trouble in LA Reading Rodney King, Reading Urban Uprising edited by Robert Gooding-Williams / The City in Crisis by Special Advisor to the Board of Police Commissioners on the Civil Disorder in Los Angeles. Contemporary Sociology, 23(4), 475. Ochs, H. L., Gonzalzles, K. M. (2014). Police brutality. Salem Press Encyclopedia, Maney, K. (2014). EVEN FERGUSON’S COPS CAN BE FIXED WITH MORE VIDEO. Newsweek Global, 163(12), 44-45. Anonymous (2014). Mike Brown Law. Requires all state, county, and local police to wear a camera. Retrieved from https://petitions.whitehouse.gov/petition/mike-brown-law-requires-all-state-county-and-local-police-wear-camera/8tlS5czf CATO Institute (2010). 2010 Annual Report. Retrieved from http://www.policemisconduct.net/statistics/2010-annual-report/ Frankel, C.T. (2014, August 12). Why the police-shooting riots in Ferguson, Mo., had little to do with Ferguson. Retrieved from: http://www.washingtonpost.com/news/storyline/wp/2014/08/12/why-the-police-shooting-riots-in-ferguson-mo-had-little-to-do-with-ferguson/ Credo Action (2014). Justice for Mike Brown. Retrieved from: http://act.credoaction.com/sign/mike_brown_justice

Dinner With Bill Gates :: essays research papers

Dinner With Bill Gates [The time is the late 1990's and the setting is an unidentified city in the northwest United States, in Washington. Three employees of Microsoft, the narrator, Encolpius, and his co-workers Giton and Ascyltus, have been invited to the illustrious mansion of billionaire Bill Gates, for a banquet.] It was slightly drizzling as we approached the house. We were simply amazed at it's size, it was a good quarter mile in length and equally long in width. As we approached the enormous wooden door, lights flicked on and a computer generated voice greeted us. Not knowing what to do, we waited, letting the rain soak our dinner suits. When the door was opened, we were prompted to enter by a servant. Stepping into the entrance way, our coats were taken by a different servant than the one who had opened the door. We were ushered into a nearby room, an enormous lounge of some kind furnished with an indoor volleyball court, arcade and a pool. Giton and I were simply amazed. This guy had an amusement park in his living room. There were some young boys on the volleyball court, playing a game. I couldn't help but notice a middle-ages guy, dressed in a pair of worn jeans and a sports coat, watching the game with furious intensity. I turned to the servant, our guide, I suppose, and asked him who this man was. "Oh that's Master Gates, the proprietor of this house. You'll be dining with him shortly." The servant led us through this room, past the pool and into a narrow corridor. This hallway was adorned with pictures of Bill Gates, in various characters and positions. The only one I recognized was the cover from the recent issue of Time Magazine featuring him on the cover. From here, we were led into the dining room and seated at the large dinner table. The table occupied a majority of the room, however, there was an enormous hole in the middle, obviously for a dinner show of some kind. Immediately, our glasses were filled with wine and our hands were scrubbed with rose water. I looked at Ascyltus, and he was simply amazing at the luxurious nature of the dinner. I suddenly felt underdressed but I was relieved when Bill Gates entered, wearing a different, much darker shade of jeans and a simple, red pullover. Once Bill Gates seated himself, the dozen or so people in the room all silenced themselves, waiting for this legendary man to speak. "Welcome to my home," he began, "I hope you will have an enjoyable evening. Dinner With Bill Gates :: essays research papers Dinner With Bill Gates [The time is the late 1990's and the setting is an unidentified city in the northwest United States, in Washington. Three employees of Microsoft, the narrator, Encolpius, and his co-workers Giton and Ascyltus, have been invited to the illustrious mansion of billionaire Bill Gates, for a banquet.] It was slightly drizzling as we approached the house. We were simply amazed at it's size, it was a good quarter mile in length and equally long in width. As we approached the enormous wooden door, lights flicked on and a computer generated voice greeted us. Not knowing what to do, we waited, letting the rain soak our dinner suits. When the door was opened, we were prompted to enter by a servant. Stepping into the entrance way, our coats were taken by a different servant than the one who had opened the door. We were ushered into a nearby room, an enormous lounge of some kind furnished with an indoor volleyball court, arcade and a pool. Giton and I were simply amazed. This guy had an amusement park in his living room. There were some young boys on the volleyball court, playing a game. I couldn't help but notice a middle-ages guy, dressed in a pair of worn jeans and a sports coat, watching the game with furious intensity. I turned to the servant, our guide, I suppose, and asked him who this man was. "Oh that's Master Gates, the proprietor of this house. You'll be dining with him shortly." The servant led us through this room, past the pool and into a narrow corridor. This hallway was adorned with pictures of Bill Gates, in various characters and positions. The only one I recognized was the cover from the recent issue of Time Magazine featuring him on the cover. From here, we were led into the dining room and seated at the large dinner table. The table occupied a majority of the room, however, there was an enormous hole in the middle, obviously for a dinner show of some kind. Immediately, our glasses were filled with wine and our hands were scrubbed with rose water. I looked at Ascyltus, and he was simply amazing at the luxurious nature of the dinner. I suddenly felt underdressed but I was relieved when Bill Gates entered, wearing a different, much darker shade of jeans and a simple, red pullover. Once Bill Gates seated himself, the dozen or so people in the room all silenced themselves, waiting for this legendary man to speak. "Welcome to my home," he began, "I hope you will have an enjoyable evening.

Doublespeak: Nuclear Power Plants :: essays research papers

Doublespeak: Nuclear Power Plants Harrisburg, Pennsylvania is the home of a large, efficient, and threatening nuclear power plant, Three Mile Island. Nuclear power plants have the awesome ability to create large amounts of power with very little fuel, yet they carry the frightening reality of a meltdown with very little warning. Suppose you live in Harrisburg and you here that the nearby nuclear plant had a partial meltdown, how would you react? When most people here the word meltdown, they automatically think radiation, cancer, and death. Now suppose your living in Harrisburg and you here the nearby power plant experienced a "normal aberration", you would probably react differently. Even with the highly proven safety of nuclear power, there is still fear from citizens and the chance of an accident. The nuclear power industry uses misleading language, and words understood by nuclear employees only, or euphemisms and jargon, to mislead the public and make them believe that there is nothing to be afraid of and that there is no possibility of a major accident. They take the public's biggest fears, meltdowns and contaminations, and make them into "events" and "infiltrations." This use of doublespeak is misleading to the public and may make them believe that a major accident hasn't happened, or the accident was a normal event or minor incident. In 1979 a valve in the Three Mile Island stuck open, allowing coolant, an important part of the plant, to escape from the reactor. An installed emergency system did its job and supplied the reactor with necessary coolant, but the system was shot off for a few hours due to employee error. Corrective action was eventually taken, and only a partial meltdown occurred. The plant's containment building was able to hold most of the radioactive products from entering the local environment. Only a small amount of activity escaped, that activity was carried by coolant water that had overflowed into an auxiliary building and then to the environment. Though the event didn't pose any extreme harm to citizens, this one billion dollar incident wasn't an everyday event or normal occurrence, as the industry's doublespeak makes you believe. In 1986 a similar but more serious event occurred in the USSR. A nuclear power plant at Chernobyl exploded and burned. The explosion was caused by an unauthorized testing of the reactor by its operators. Radiation spread rapidly forcing 135,000 evacuations within a 1000 mile radius, and more then 30

Meditation: The Balance of Life Essay -- Religion, Buddhism, Hinduism,

All throughout history Buddhist monks and the eastern religion have been performing meditation, but recently anyone has been trying it. Meditation is a practice that someone may train their mind to be in a state of consciousness that benefits their mind and body. Meditation is about paying attention, focusing and being very calm. It sharpens creativity and performance while enhancing relationships. Meditators find when they stop taking things in life so seriously, the self drops away. They are more direct and absorb life easier. (Ellison 3) Meditation has been around for thousands of years. In every religion, the instructions for meditating are the same, only the words differ. There are two major types of meditation that may benefit the user. By meditating the human mind may find peace and enhancement of mental activity and awareness. It's very simple to do, and only takes a small amount of your time a day. (Roach 3) Meditation originated in the eastern religion with Buddhism and Hinduism. Monks have meditated their whole life, through time, helping them become better people. Tibetans and the Dalai Lama have been performing meditation intensely for centuries. These Buddhist followers train using the Tibetan Nyingmapa and Kagyupa traditions for about 10,000 to 50,000 hours over 15-40 years. At one time meditation was part of the basic training for the entire Mozambique military. (Kaufman 2)(Roach 2) Thinking and other mental activity produce short bursts of electrical activity in the brain called gamma waves. In studies monks, who have been training the longest, have higher levels of gamma waves. Gamma waves are some of the highest-frequency brain impulses; they are also the most important electrical brain impulses. G... ... and let your mind be vigilant. If you hear distractions or have thoughts, let them go. Be happy you noticed them; don't feel as if they interrupted your meditation. Continue doing this daily for 10-20 minutes and notice the effects it may have on you. Continue this practice until it gets easier and use whenever needed. Scientific data shows it has its benefits, as I listed most. Most doctor visits are from stress, so by meditating once or twice daily the visits to the doctor will be less. I actually am thinking about trying it out myself. If the benefits sounded as great to you, as they did to me, I hope you'll try it yourself. Meditation can help balance out your life, why not try it? It's fairly simple and fast. In the future, I predict meditation will be a major part of any person’s life to help deal with everyday frustrations a little easier. (Roach 3)

Review of Russia’s Wasteful Attitude towards Oil Reserves

Russia has a high potency for energy copiousness do to its resource rich land. Russia is one of the most uneconomical manufacturers of energy due to misdirection of resources. This is partly because of the fact that Russia is so big that its public assumes that there will ever be more oil to detect, so Russia is non efficient with what it has. This feature of Russia comes from the political orientation of monetary value relationships formed during Russia’s communist yesteryear. The Communist era’s leaders set their precedences on supplying the Soviet with military-industrial complex with inexpensive energy and natural stuffs, ( Goldman ) . This was done to maintain monetary values low to increase economic growing. The job is that these patterns are still portion of the substructure of Russia today. Russia’s ruin was that it had about excessively many resources that attracted corruptness. Right after the Bolshevik Revolution Lenin determined that Russia’s e conomic growing would be dependent on its ain energy potency. Lenin’s attempts went to make the State Electricity Development plan. This plan finally included oil and gas. Separate ministries within the plan led to direct the production and pricing of Russia’s energy and energy resources. This made the Soviet successful with energy, even to the point of catching the US by agencies of bring forthing crude oil in the 1970’s. This was one of the ruins to subsequently Russia. When Russia was bring forthing that much crude oil it made it harder for future production. One of the instances is that they used excessively much H2O injection which caused an addition in oil extraction, but created long term harm to Wellss that finally limited productiveness. This short term believing made Russia utilize up its huge resources, and will subsequently do jobs for the Russian economic system. Russia has ever been defined by its landscape every bit much as by its political orientation and its people. You can non command what is under your undersoil, but Russia is lucky plenty to hold tonss of oil. This will impact many of the picks its leaders have made. Oil makes up approximately 20 per centum of Russia ‘s economic system, 55 per centum of its export net incomes, and 40 per centum of its entire revenue enhancement grosss, ( Naim, Moises ) . In 2004 Russia had a 3rd of the world’s gas militias and was the 2nd largest oil exporter next to Saudi Arabia. Europe is dependent on this since they get a tierce of their oil from Russia. Russia’s high dependance on oil has led it to hold many of the features of a Petro-state. Think of an oil rich state, many are in the in-between E with some being in South America or Africa. Take Venezuela or a two-channel typical Middle Eastern state for an illustration. These states typically have weak establishments, a neglect ing public service, and the wealth is in a high concentration with the general public being in poorness. Russia has many of these features but non as extreme. The general populace of Russia is angered by the hapless per centum of the nation’s money from oil and widespread poorness. The job with a state being a Petro-state is that while it makes good gross, the money is in the custodies of those involved and people outside of the oil concern do non profit much at all. The ground for the bead of Russia’s laterality of oil in 2004 is from the new oil engineering that other states have developed. In the 1990’s Russia made inventions in geographic expedition and boring that brought oil Fieldss into production that had non been bring forthing before. The Middle East is non about as stable which has led many companies to turn to Russia for concern. When a state with weak cheques and balances is flooded with gross from crude oil, a petro province is created. If the stat e is strongly democratic with a good populace sector so oil money will non interrupt the economic system such as the US. Petroleum money mixed with hapless public establishments created poorness and corruptness. States with high dependance on oil exports end up with a jobless, volatile economic growing. Crude oil creates money in exports but does non make many occupations which is the ground for the hapless distribution of wealth. There has non been a recorded Petro-state that has turned oil into prosperity for the bulk of its public. While Russia is so dependent on oil, merely two million of its 67 million workers are employed in the oil and gas industry. This big independency on oil causes Russia’s economic system to fluctuate with the monetary value of oil, normally known as roar flop rhythm. When making good the economic system will din, but it ever finally busts. Russia gets over half of its revenue enhancement grosss from the top 10 largest companies. This is two-channe l typical of a Petro-state, which usually has a narrow revenue enhancement base. This causes corrupt authorities thanks to the concentration of revenue enhancement money in a few big companies. Since the companies make up a big per centum of the revenue enhancement gross, they have a larger pull in who gets elected. Guess who they want to acquire elected? They want whoever will profit the company more. This farther causes a larger difference in the spread of wealth because of big companies keeping on to the money and commanding the economic system. The job with nationalising the oil industry is that it causes province owned companies to pervert and command politicization and they can sabotage weak public establishments. Privatizing can besides be a job without a strong ordinances on its revenue enhancements. If this is non done a monopoly could interrupt out which would do greater jobs. Russia is fortunate that it has non yet go a complete Petro-state as of yet. It has a diverse eco nomic system, although mostly dependent on oil, but it could be of usage to follow a strong democracy to assist with its political failing. Russia’s economic system is non known for being stable and strong. If this was non bad plenty, the bead in the monetary value of oil is endangering Russia into a recession. The monetary value of rough oil reached its lowest point in four twelvemonth in October of 2014 ( Arutunyan 1 ) . There is a opportunity that Russia, who gets half of its gross Petroleum based exports, would lose one million millions due to the dropping rough oil monetary value, ( Arutunyan 1 ) . Russia’s economic system is so depended on oil that a mere five dollar loss per barrel of rough oil would be Russia six billion dollars per twelvemonth in lost gross. The heavy monetary value of oil has caused Russia’s exchange rate to other currencies to drop by 20 per centum in the past twelvemonth. A good part of Russia’s economic problems have been caused by Western countenances over Russia’s engagement with Ukraine, and ended up in countenances stoping Western funding assisting Russ ian companies, ( Arutunyan 1 ) . This might look like merely Russia is in problem, but due Russia’s economic dealingss with other states, the neglecting economic system could hold planetary effects. If Russia’s recognition goes down it could impact states in Europe and Asia that on a regular basis trade and rely on its economic stableness. This would be kindred to if China were to get down bear downing 50 per centum more for the goods it trades to America, so America would be in economic problem due to the fact that the US relies to a great extent upon China for its commerce. In the state of affairs of Russia, it is the world’s 8th largest economic system, so many other states depend upon it. If rough oil monetary values would drop to the point that oil dependant Russia goes into a recession, so a better portion of two continents would besides travel into recession. Russia usually exports in dollars and spends money in its ain currency, rubles. This means that the take downing value of ruble’s causes more rubles for every dollar received in oil gross, ( Arutunyan 1 ) . â€Å" This twelvemonth, ( 2014 ) , we have made more than 1.5 trillion rubles ( $ 36.5 billion ) on the ruble ‘s devaluation, † ( Orlova ) . This consequence is non all good though, if the monetary value of oil does non lift the buffer will run out. â€Å" If oil monetary value continues to fall at the same rate, the negative consequence for the GDP will increase, If oil falls to $ 75 per barrel, we could lose up to 3 % of economic growing. That would slightly intensify the recession that ‘s about to acquire underway. † Alexander Golovtsov main analyst at Moscow’s UralSib Asset Management. Soviet union does hold clip to retrieve nevertheless, because of its big Reserve and National Welfare Fund. This will purchase clip for about another two old ages for the oil monetary values to come back up. There would be effects for utilizing modesty financess, one of them being holding to cut military disbursement.