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Tuesday, December 31, 2019

Have Law and Equity Influenced Each Other - Free Essay Example

Sample details Pages: 10 Words: 3064 Downloads: 10 Date added: 2017/06/26 Category Law Essay Type Argumentative essay Level High school Did you like this example? 1 Table of Cases Bank of Boston Connecticut v European Grain and Shipping Ltd Central London Property Trust Ltd v High Trees House Ltd Cresswell v Potter (1978) 1 WLR 255 Cuckmere Brick Co Ltd v Mutual Finance Ltd Earl of OxfordÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Case (1615) 1 Rep Ch 1 Napier and Ettrick (Lord) v Hunter Tinsley v Milligan United Scientific Holdings v Burnley Borough Council Walsh v Lonsdale Table of Statutes Bills Supreme Court Act 1981 Supreme Court of Judicature Act 1873 (36 37 Vict C. 66) Supreme Court of Judicature Act 1875 (38 39 Vict C. 77) Ãƒ ¢Ã¢â€š ¬Ã‹Å"Ãƒ ¢Ã¢â€š ¬Ã‹Å"Neither law nor equity is now stifled by its origin and the fact that both are administered by one Court has inevitably meant that each has borrowed from the other in furthering the harmonious development of the law as a wholeÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[1] In Order to critically evaluate the accuracy of the above statement and to enable an analysis of the relative strengths of the Ãƒ ¢Ã¢â€š ¬Ã‹Å"dualismÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ and Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusionÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ debate, in order to form a cogent narrative it will be necessary to briefly explore both the definitions, history, distinctions and development of common law and equity. DonÃ¢â‚¬â„¢t waste time! Our writers will create an original "Have Law and Equity Influenced Each Other?" essay for you Create order Firstly, whilst definitions of the Ãƒ ¢Ã¢â€š ¬Ã‹Å"Common LawÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ system differ it can be defined as the Ãƒ ¢Ã¢â€š ¬Ã‹Å"general lawÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ which is common to the realm, and also the body of law which has evolved by judges from precedent.[2] Moreover the definition of Equity in common parlance translates to fairness/justice (aequitas equitas). Although according to S Worthington, Ãƒ ¢Ã¢â€š ¬Ã‹Å"[Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] even the most experienced of lawyers finds it difficult to give a short, intelligible answer to the question Ãƒ ¢Ã¢â€š ¬Ã‹Å"What is equity?Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[3] However, an eloquent definition was stated in Cresswell v Potter[4] Ãƒ ¢Ã¢â€š ¬Ã‹Å"The law which modifies the general common law rules where the general rules cause practical hardship in a particular case (restrains the unconscionable exercise of rights or powers at common law)Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢. Prior to the Norman Conquest in 1066 England had no functional common law which was consistent ly applied to the whole of the realm, there existed only cursory oral rules and customs which were wide-ranging between different provinces,[5] for example the Ãƒ ¢Ã¢â€š ¬Ã‹Å"Jutes in the South having different laws to the MercianÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢sÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ along with informal gatherings and medieval Tests[6]. However, even post Norman Conquest the Ãƒ ¢Ã¢â€š ¬Ã‹Å"Leges Henrici Primi (c.1118)Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ documented fragmented legal codes and jurisdictions such as Mercian, Danelaw and Wessex law.[7] During the following three centuries post Norman Conquest (1066) the priority became the establishment of a strong Ãƒ ¢Ã¢â€š ¬Ã‹Å"Common lawÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ central to the realm mainly to safeguard Ãƒ ¢Ã¢â€š ¬Ã‹Å"Royal revenuesÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[8], which led to Royal envoys participating in local courts, such as the (the curia regis) by the thirteenth century the Common Law courts of KingÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Bench, the Court of Exchequer and the Court of Common Pleas w ere established.[9] During the reign of Henry II who has been credited with principally generating the advancement of the common law[10] with the royal envoys Ãƒ ¢Ã¢â€š ¬Ã‹Å"justiciae errantes (wandering justices)Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[11]. However, the common law was not without faults as the writ system was technical, inflexible and compounded by the provisions of Oxford 1258 and the statute of Westminster led to injustices.[12] Nevertheless, by the Fourteenth Century those who felt aggrieved could appeal to the KingÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s conscience for a remedy, however the role was passed to the Lord Chancellor as Ãƒ ¢Ã¢â€š ¬Ã‹Å"Keeper of the Kings conscienceÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ due to the volume of appeals, with decisions based randomly on Ãƒ ¢Ã¢â€š ¬Ã‹Å"conscienceÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢. This led to one of the historic criticisms of its application as arbitrary, as famously quoted by Jurist John Selden, Ãƒ ¢Ã¢â€š ¬Ã‹Å"Equity varies with the length of the Chancellors footÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[13]. Over the next few centuryÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s growing friction between equity and the common law courts increased, as the Ãƒ ¢Ã¢â€š ¬Ã‹Å"Court of Chancery acted as a check upon the common law ensuring that their application did not lead to a manifest injusticeÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[14].This conflict dramatically reached its nexus in the Earl of Oxfords Case[15] with the dispute being settled in 1616 by James I with the Court of Chancery gaining supremacy. Lord Ellesmere Stated, menÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s actions [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] diverse and infinite that it is impossible to make any General law which will [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] meet with every particular and not fail in some Circumstances. The office of the Chancellor is to correct menÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s consciences for fraud, breaches of trust, wrongs and oppressions[Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] and to soften and mollify the extremity of the law.[16] This gave rise to the equitable maxim Ãƒ ¢Ã¢â€š ¬Ã‹Å"that where the law and equ ity conflict, equity prevailsÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[17] this principle was later given statutory authority under section 25[18] and re-enacted under section 49[19] after The three common law courts and the Court of Chancery were merged into a single Supreme Court, comprising of the High Court and the Court of Appeal. Under the Judicature Acts[20] allowing Ãƒ ¢Ã¢â€š ¬Ã‹Å"The jurisdiction of judges in the new Supreme Court was fused, this reduced delays and expense of starting separate actions as now all judges were able to use the whole range of common law and equitable rulesÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[21]. There remains a considerably contentious debate between legal scholars that has thundered on for well over one hundred and thirty years, as to whether the common law and equity are truly fused, either on a substantive or procedural level, those who believe in the dualist Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusion fallacyÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ doctrine and even those who conclude whether they should be fused. P.V Baker[22] states Ãƒ ¢Ã¢â€š ¬Ã‹Å"that fusion [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] there is no distinction [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] between legal rights, remedies and thus cannot be supportedÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ this view is reinforced by J Martin[23] who states the Ãƒ ¢Ã¢â€š ¬Ã‹Å"Supreme Court act clearly, envisaged both equity and common law would [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] separate existenceÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ and that Lord Brandon[24] stated that Ãƒ ¢Ã¢â€š ¬Ã‹Å"important proceduresÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ changed, although no third party rights were altered [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] or were intended to be[25]. Although, controversially those who advocate Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusionÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ suggest it is the Ãƒ ¢Ã¢â€š ¬Ã‹Å"awarding of legal remedies for a breach of an equitable rightÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[26]. However, P. Mason in Harris v Digital Pulse[27] did in a dissenting opinion argue that it [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] Ãƒ ¢Ã¢â€š ¬Ã‹Å"exposes the error of restricting equityÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s capacity to award compensation for infri ngement of a right recognised in the pre-Judicature Act eraÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ citing Viscount HaldaneÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s speech in Nocton v Lord Ashburton[28] Furthermore, Walter Ashburner argues[29] from a procedural dualist standpoint, that the judicature acts[30] only fused the administration of law by Ãƒ ¢Ã¢â€š ¬Ã‹Å"unifying Common law and equity into one court systemÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢, it did not fuse the content of the two doctrines. The principles of equity and the principles of law remained separate: of jurisdiction, he likened both equity and the common law to that of two streams which run side by side [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] however Ãƒ ¢Ã¢â€š ¬Ã‹Å"never minglingÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ their waters. Moreover, Lord Diplock who has long been hailed as Ãƒ ¢Ã¢â€š ¬Ã‹Å"the most forceful exponent of fusion [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦]Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[31] argues in obiter[32] the fusion of common law and equity is more substantive and has already occurred with the Ãƒ ¢Ã¢â€š ¬Ã‹Å"streamsÃƒ ¢Ã¢â€š ¬ Ã¢â€ž ¢ of equity and the common law [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] long since mingled togetherÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢. In addition Lord Diplock went so far as to state that AshburnerÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s metaphorical usage was both Ãƒ ¢Ã¢â€š ¬Ã‹Å"mischievous and deceptiveÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[33]. Nevertheless, Meagher, Heydon and Leeming[34] who are amongst the strongest supporters of dualism. Maintain that the decision in the United Scientific[35] as not only Ãƒ ¢Ã¢â€š ¬Ã‹Å"the low water mark of modern English jurisprudenceÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ and the conjecture that lord Diplock believing [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] Ãƒ ¢Ã¢â€š ¬Ã‹Å"the Statutes of Uses [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] of Quia Emptores played no contemporary part in English property law.Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[36] Ãƒ ¢Ã¢â€š ¬Ã…â€œThe fusion fallacy involves the administration of a remedy, for example common law damages for breach of fiduciary duty, not previously available at law or in equity, or in the modification of principles in one branch of the jurisdictio n by concepts that are imported from the other and thus are foreign, for example by holding that the existence of a duty in tort may be tested by asking whether the parties concerned are in fiduciary relationshipsÃƒ ¢Ã¢â€š ¬Ã‚ [37] However, there is seemingly an accord with Lord Diplock as Lord Denning M.R. who suggests a deeper fusion between equity and common law which would suggest that it has been fused for a considerable time. Ãƒ ¢Ã¢â€š ¬Ã‹Å"When law and equity have been joined together for over seventy years, principles must be considered in the light of their combined effectÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢.[38] Furthermore, Peter Sparkes suggests, the Ãƒ ¢Ã¢â€š ¬Ã‹Å"doctrine of Walsh v LonsdaleÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[39]. Ãƒ ¢Ã¢â€š ¬Ã‹Å"that an agreement for a lease is as good as a leaseÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢. And cites Jessel MR, Ãƒ ¢Ã¢â€š ¬Ã‹Å"equitable rule prevailing [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] He appeared to espouse a true fusionÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[40]. And went on to argue that varying attempts to Ã ƒ ¢Ã¢â€š ¬Ã‹Å"distort the decision and the old procedureÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ in order to Ãƒ ¢Ã¢â€š ¬Ã‹Å"make it fitÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ with Ashburners procedural dualist standpoint, although in Sparkes opinion in reality it could Ãƒ ¢Ã¢â€š ¬Ã‹Å"only be explained as an example of true fusionÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[41]. It would on the face of it seem anomalous that a unified court with jurisdiction over both common law and equity would strictly preserve an historical distinction between them[42] and that it would suggest it would inevitably result in fusion[43] The Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusion of law and equity is often categorised as if they were factÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[44] albeit that the reforms brought about by the Judicature Acts have clearly fused their administration. However, no new grounds of Ãƒ ¢Ã¢â€š ¬Ã‹Å"action, remedy or defence have been createdÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[45] as the Judicature Act was intended to rid the law of unnecessary delay overlap and complication[46] Moreover, Andr ew Burrows argues for more Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusionÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ so We do this at common law and we do the same at equity[47] additionally taking account of BakerÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s definition of Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusionÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ Ãƒ ¢Ã¢â€š ¬Ã‹Å"there is no distinction [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] between legal rights, remedies [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦]Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[48] this combined with David Hughes Ãƒ ¢Ã¢â€š ¬Ã‹Å"arguments counter to the fusionÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ of common law and equity such as Ãƒ ¢Ã¢â€š ¬Ã‹Å"Courts lacking the power to fuse common law and equityÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢, and asserting that this would be exercising a Ãƒ ¢Ã¢â€š ¬Ã‹Å"radical law reform briefÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢.[49] Remain Ãƒ ¢Ã¢â€š ¬Ã‹Å"compelling as [Ãƒ ¢Ã¢â€š ¬Ã‚ ¦] still deny the availability of a common law remedy for an equitable wrongÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢.[50] Likewise, Jill Martin suggests, that the Courts of England and Wales have not followed other Commonwealth jurisdictions who appear to support and enc ourage the concept that the judicature Acts have in some way Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusedÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ common law and equity substantively, such as is suggested in cases like United Scientific Holdings Ltd[51] and Cuckmere Brick Co Ltd[52] and have instead conversely reinforced the more orthodox view apparent from Ãƒ ¢Ã¢â€š ¬Ã‹Å"mortgage casesÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ and decisions of the Ãƒ ¢Ã¢â€š ¬Ã‹Å"House of LordsÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ such as Napier v Hunter[53] and Tinsley v Milligan[54] which contain Ãƒ ¢Ã¢â€š ¬Ã‹Å"meticulous analyses of the separate common law and equitable origins and principles in areas such as subrogation and illegalityÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[55]. Consequently, in the context of the law in England and Wales and based on the in depth critical analysis of the Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusion v dualismÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ debate the overall relative strength of the dualism argument is highly indicative that although there is administrative Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusionÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢, it is evident that common law and equity are still not Ãƒ ¢Ã¢â€š ¬Ã‹Å"fusedÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ in the substantive sense therefore, even with a high degree of harmonisation there has been no actual synthesis between the common law and equity post judicature Acts, and although the Courts can and do apply both rules to common law and equity as aptly illustrated by the maxim, Ãƒ ¢Ã¢â€š ¬Ã‹Å"Equity follows the lawÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ Ãƒ ¢Ã¢â€š ¬Ã…â€œonly in cases when there is an important context disregarded or if the common law is used in an unconscionable way that equity interferes.Ãƒ ¢Ã¢â€š ¬Ã‚ [56]. Furthermore, as to the accuracy of the statement above[57] Gary Watt elucidates quite succinctly that Ãƒ ¢Ã¢â€š ¬Ã‹Å"nowadays this summary finds overall approvalÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢[58] from most quarters due to harmonisation and evolution in both the common law and equity. Bibliography Books Alastair H and Hudson A,Equity and Trusts (Routledge Cavendish 2009) Arnold-Baker C,The Compan ion to British History, S.v. Ãƒ ¢Ã¢â€š ¬Ã‹Å"English LawÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (Loncross Denholm Press 2008) Ashburner W,AshburnerÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Principles of Equity. (2nd edn, Butterworth 1933) Atkins S,Equity and Trusts (Routledge 2013) Baker P and Langan P,SnellÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Principles of Equity (29th edn, Sweet Maxwell 1990) Baker PV,SnellÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Equity (23rd edn, Sweet Maxwell , London 1990) Clement R and Abass A,Equity Trusts, Text, Cases and Materials (2nd edn, Oxford University Press 2011) Equity and Trusts Law Directions, Fourth Edition, Gary Watt, 2014 Oxford University Press Equity and Trusts, Scott Atkins, 2013, Routledge Heydon JD, Gummow WMC and Austin RP,Cases and Materials on Equity and Trusts (4th edn, Butterworths 1993) Hudson A,Equity and Trusts (Routledge Cavendish 2012) Kelly D and Slapper G,The English Legal System (11th edn, Routledge 2010) Maitland F,Selected Historical Essays of F W Maitland: Chosen and I ntroduced by H M Cam (1957) 134 Martin E and Law J,A Dictionary of Law (Oxford University Press, USA 2006) Martin J and Hanbury,Modern Equity (Sweet Maxwell 2009) McDonald I and Street A, Equity Trusts Concentrate: Law Revision and Study Guide (Oxford University Press 2014) McDonald I and Street A,Equity Trusts Concentrate: Law Revision and Study Guide (Oxford University Press, USA 2011) McGhee J,SnellÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Equity (Sweet Maxwell) Meagher R and Heydon J,Meagher, Gummow and LehaneÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Equity, Doctrines, and Remedies (Butterworths LexisNexis 2002) Meagher R, Heydon JD and Leeming M,Meagher, Gummow and LehaneÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Equity: Doctrines and Remedies (4th edn, 2002) 2-105 Plucknett TF,A Concise History Of The Common Law (Liberty Fund 1956) Simpson AWB,Ãƒ ¢Ã¢â€š ¬Ã‹Å"the Survival of the Common Law System; Then and NowÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (Sweet Maxwell 1974) Stenton LDM,English Justice Between the Norman Conquest and t he Great Charter, 1066-1215 (1st edn, Allen Unwin 1964) Thurston,A PractitionerÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Guide to Trusts (Bloomsbury Professional 2006) Todd and WattÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Cases Materials on Equity and Trusts, 9thEdition, 2013, Oxford University Press, Gary Watt Toomer GJ,John Selden: A Life in Scholarship (Oxford, OUP 2009) Watt G, Equity and Trusts Law Directions (Oxford University Press) Watt G,Todd and WattÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Cases and Materials on Equity and Trusts (Oxford University Press, USA 2007) Wilson S,Todd ; WilsonÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Textbook on Trusts (Oxford University Press 2013) Worthington S,Equity (2nd edn, OUP 2003) Journal Articles Baker P., Ãƒ ¢Ã¢â€š ¬Ã‹Å"Future of EquityÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢, (1977) 93 Law Quarterly Review 529 540 https://www.heinonline.org.ergo.glam.ac.uk/HOL/Index?index=journals/lqrcollection=journals accessed 12 November 2014 Burns F, Ãƒ ¢Ã¢â€š ¬Ã‹Å"The Fusion Fallacy RevisitedÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (1993) 5 Bond Law Review Burrows A, Ãƒ ¢Ã¢â€š ¬Ã‹Å"We Do This At Common Law But That In EquityÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (2002) 22 Oxford Journal of Legal Studies Chesterman S, Ãƒ ¢Ã¢â€š ¬Ã‹Å"Beyond Fusion Fallacy: The Transformation of Equity and DerridaÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Ãƒ ¢Ã¢â€š ¬Ã…â€œThe Force of LawÃƒ ¢Ã¢â€š ¬Ã‚ Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (1997) 24 JOURNAL OF LAW AND SOCIElY 350 Hughes DA, Ãƒ ¢Ã¢â€š ¬Ã‹Å"A CLASSIFICATION OF FUSION AFTER HARRIS V DIGITAL PULSEÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ 29(2) UNSW Law Journal 38 James E, Ãƒ ¢Ã¢â€š ¬Ã‹Å"A Ãƒ ¢Ã¢â€š ¬Ã…â€œFusion FallacyÃƒ ¢Ã¢â€š ¬Ã‚ Fallacy?Ãƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (2003) 119 Law Quarterly Review 375-380 Jho R, Ãƒ ¢Ã¢â€š ¬Ã‹Å"The Ãƒ ¢Ã¢â€š ¬Ã…â€œFusion FallacyÃƒ ¢Ã¢â€š ¬Ã‚ between Equity and Common Law: A Criticle AnalysisÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (2014) 56 NSWLR https://racheljho.files.wordpress.com/2014/04/the-fusion-fallacy-between-equity-and-common-law.pdf Martin J, Ãƒ ¢Ã¢â€š ¬Ã‹Å"Fusion, Fallacy and Confusion; a Comparative StudyÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ [1994] Conveyancer and Property Lawyer Sparkes P, Ãƒ ¢Ã¢â€š ¬Ã‹Å"WALSH V LONSDALE THE NON-FUSION FALLACYÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (1988) 8 Oxford Journal of Legal Studies Tilbury M, Ãƒ ¢Ã¢â€š ¬Ã‹Å"Fallacy or FurphyÃƒÆ'Ã‚ ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¯: Fusion in a Judicature WorldÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (2003) 26 (2) U.N.S.W. Law Journal 357 Websites Ãƒ ¢Ã¢â€š ¬Ã‹Å"Judges and the LawÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ https://www.open.edu/openlearn/society/the-law/judges-and-the-law/content-section-2.1 accessed 12 November 2014 Ãƒ ¢Ã¢â€š ¬Ã‹Å"Legislation.gov.ukÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢https://www.legislation.gov.uk/ukpga/1981/54/section/49 accessed 12 November 2014 Ãƒ ¢Ã¢â€š ¬Ã‹Å"TheNationalArchivesÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ https://www.nationalarchives.gov.uk/pathways/citizenship/citizen_subject/law.htm accessed 11 November 2014 Cases Bank of Boston Connecticut v European Grain and Shipping Ltd Central London Property Trust Ltd v High Trees House Ltd Cresswell v Potter (1978) 1 WLR 255 Cuckmere B rick Co Ltd v Mutual Finance Ltd Earl of OxfordÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Case (1615) 1 Rep Ch 1 Napier and Ettrick (Lord) v Hunter Tinsley v Milligan United Scientific Holdings v Burnley Borough Council Walsh v Lonsdale Statutes Supreme Court Act 1981 Supreme Court of Judicature Act 1873 (36 37 Vict C. 66) Supreme Court of Judicature Act 1875 (38 39 Vict C. 77) 1 [1] (per Somer J, Elders Pastoral Ltd v Bank of New Zealand [1989] 2 NZLR 180 at 193). [2] Elizabeth Martin and Jonathan Law, A Dictionary of Law (Oxford University Press, USA 2006). [3] Sarah Worthington, Equity (OUP 2003). [4] [1978] 1WLR 255) [5]Theodore FT Plucknett, A Concise History Of The Common Law (Liberty Fund 1956). [6] Ãƒ ¢Ã¢â€š ¬Ã‹Å"Judges and the LawÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ https://www.open.edu/openlearn/society/the-law/judges-and-the-law/content-section-2.1 accessed 12 November 2014. [7]Ãƒ ¢Ã¢â€š ¬Ã‹Å"The National ArchivesÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ https://www.nationalarchives.gov.uk/pathways/citizenship/citizen_subject/law.htm accessed 11 November 2014. [8] Martin (n 2) 109. [9] Ibid 109. [10] Lady Doris Mary Stenton, English Justice Between the Norman Conquest and the Great Charter, 1066-1215 (1st edn, Allen Unwin 1964) [11] Martin (n 2) 109. [12] David Kelly and Gary Slapper, The English Legal System (11th edn, Routledge 2010) [13]GJ Toome r, John Selden: A Life in Scholarship (Oxford, OUP 2009). [14] Iain McDonald and Anne Street, Equity Trusts Concentrate: Law Revision and Study Guide (Oxford University Press 2014). [15] (1615) 1 Rep Ch 1 [16] Lord Ellesmere, in the Earl of Oxfords Case [1615] 1 Rep Ch 1 [17] McDonald (n 13) 9. [18] Supreme Court of Judicature Act 1873 (36 37 Vict c. 66) [19] Supreme Court Act 1981 [20] Supreme Court of Judicature Act 1873 (36 37 Vict c. 66) and the Supreme Court of Judicature Act 1875 (38 39 Vict c. 77) [21] McDonald (n 13) 9. [22] P. Baker, Ãƒ ¢Ã¢â€š ¬Ã‹Å"Future of EquityÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢, (1977) 93 Law Quarterly Review 529 540 https://www.heinonline.org.ergo.glam.ac.uk/HOL/Index?index=journals/lqrcollection=journals accessed 12 November 2014. [23] Martin (n 22) 1. [24] ibid [25] Bank of Boston Connecticut v European Grain and Shipping Ltd [1989] A.C. 1056 at p. 1109. [26] Rachel Jho, Ãƒ ¢Ã¢â€š ¬Ã‹Å"The Ãƒ ¢Ã¢â€š ¬Ã…â€œFusion FallacyÃƒ ¢Ã¢â€š ¬Ã‚ between Equity and Common Law: A Criticle AnalysisÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (2014) 56 NSWLR https://racheljho.files.wordpress.com/2014/04/the-fusion-fallacy-between-equity-and-common-law.pdf. [27] Pty Ltd [2003] NSWCA 10 [28] [1914] AC 932 [29] W Ashburner, AshburnerÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Principles of Equity. (2nd edn, Butterworth 1933). [30] Supreme Court of Judicature Act 1873 (36 37 Vict c. 66) and the Supreme Court of Judicature Act 1875 (38 39 Vict c. 77). [31] JD Heydon, WMC Gummow and RP Austin, Cases and Materials on Equity and Trusts (4th edn, Butterworths 1993) 27. [32] United Scientific Holdings v Burnley Borough Council AC 904 924-925. [33] ibid [34] Roderick Meagher, John Dyson Heydon and Mark Leeming, Meagher, Gummow and LehaneÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Equity: Doctrines and Remedies (4th edn, 2002) 2-105. [35] R Meagher and J Heydon, Meagher, Gummow and LehaneÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Equity, Doctrines, and Remedies (Butterworths LexisNexis 2002). [36] ibid [37] Ibid (n 34) [38] Central London Property Trust Ltd v High Trees House Ltd [1947] KB 130. [39] (1882) 21 ch D 9. [40] PETER SPARKES, Ãƒ ¢Ã¢â€š ¬Ã‹Å"WALSH V LONSDALE THE NON-FUSION FALLACYÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (1988) 8 Oxford Journal of Legal Studies 350. [41] ibid [42] AWB Simpson, Ãƒ ¢Ã¢â€š ¬Ã‹Å"the Survival of the Common Law System; Then and NowÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (Sweet Maxwell 1974). [43] Ibid (n 26) [44] Michael Tilbury, Ãƒ ¢Ã¢â€š ¬Ã‹Å"Fallacy or FurphyÃƒÆ'Ã‚ ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¯: Fusion in a Judicature WorldÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (2003) 26 (2) U.N.S.W. Law Journal 357, 26 U.N.S.W.L.J. 357 2003. [45] Martin (n 22) 1. [46] ibid (n 13) 9. [47] A Burrows, Ãƒ ¢Ã¢â€š ¬Ã‹Å"We Do This At Common Law But That In EquityÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ (2002) 22 Oxford Journal of Legal Studies. [48] Baker (n 22) [49] Meagher (n 35) 2-320. [50] David A Hughes, Ãƒ ¢Ã¢â€š ¬Ã‹Å"A CLASSIFICATION OF FUSION AFTER HARRIS V DIGITAL PULSEÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ 29(2) UNSW Law Journal 38. [51] United Scientific Holdings v Burnley Borough Council AC 904 924-925. [52] Cuckmere Brick Co. Ltd. v. Mutual Finance Ltd [1978] A.C. 904. [53] Napier and Ettrick (Lord) v. Hunter [1993] 2 W.L.R. 42. [54] Tinsley v. Milligan [1993] 3 All E.R. 65. [55] Jill Martin, Ãƒ ¢Ã¢â€š ¬Ã‹Å"Fusion, Fallacy and Confusion; a Comparative StudyÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢ [1994] Conveyancer and Property Lawyer. [56] P Baker and P Langan, SnellÃƒ ¢Ã¢â€š ¬Ã¢â€ž ¢s Principles of Equity (29th edn, Sweet Maxwell 1990). [57] Ibid (n 1) [58] Gary Watt, Equity and Trusts Law Directions (Oxford University Press) 10.

Monday, December 23, 2019

Cyber Bullying And The Rise Of Technology Essay - 1055 Words

In reading 8, Bullies Move Beyond the Schoolyard, Patchin and Hinduja discuss the ways that bullying has expanded and increased in the rise of technology. Before technology bullying was a face-to-face interaction, usually at school or coming and going from school. Bullying can cause emotional, physical, or social harm. Now that Internet is available in everyoneÃ¢â‚¬â„¢s home and on his or her phones people can be bullied from any location not just at school. Bullies are also becoming anonymous by using fake names to attack their victims, making the bullies unrivaled. Cyber bullying is at an all time high because of the amount of technology that is available to children ages 12 to 17 years old. Bullying is a deviant act that is becoming more and more easier to do, and research shows that bullies can create long-term damage to the victimÃ¢â‚¬â„¢s mental health causing them to be depressed or respond to issues with extreme violence. An example for this is the Columbine shooting in 1999 , the shooters were bullied their whole lives by students and turned their anger into something catastrophic such as killing other students in cold blood. Research also found that bullies are more likely to grow up and commit violent crimes. The research method that Patchin and Hinduja decided to use a survey method while using the Internet, which is the main source of bullying today, the web-based questionnaire, was put on a popular musicians website. Hence, this questionnaire was meant to attract bullies,Show MoreRelatedCyber Bullying is a Crime Essay examples1326 Words Ã‚ |Ã‚ 6 Pagesmay break my bones, but words will never hurt meÃ¢â‚¬ . With todayÃ¢â‚¬â„¢s technology, that saying may no longer hold true. Studies show that in the past five years, online bullying has quadrupled (M. Ross, 3). The technology has given bullies a whole another proposal for their actions; virtual name-calling can have harsh effects on the security of kids and teens in todayÃ¢â‚¬â„¢s society. An onli ne bully is someone who sends messages via technology, hides behind that keyboard and uses words or pictures to embarrassRead MorePersuasive Essay On Cyber Bullying925 Words Ã‚ |Ã‚ 4 Pagesgolden age of technology, everything is going digital. Classes could be taken online. There s no more need for people to go into the classroom. Paper copies are a good back up source but most people save a draft onto different sources instead. With everything becoming accessible by the computer, crime is evolving. Children went from bullying other kids at the playground to cyber bullying. Cyber bullying is the sending and taunting of other via the Internet. More advanced levels of cyber crime continueRead MoreCyber Bullying And Its Effect On Society883 Words Ã‚ |Ã‚ 4 PagesCyber-bullying is the use of electronic communications to bully a person. Cyber-bullying takes place by using the Internet, cell phones, video game systems, and other technology. Cyber-bully sends or posts text or image that i s intended to hurt feelings or embarrass another person in front of others. Bullying is an aggressive behavior which causes harm and stress to its victims and it escalates over time. Furthermore, everybody has mobile phones and they are using it all day long. There is certainlyRead MoreBullying Is A Common Problem Among Children And Adolescents996 Words Ã‚ |Ã‚ 4 PagesBullying is a common problem among children and adolescents (Wang, Nansel, Lannotti, 2011). Bullying takes different forms include physical (hitting), verbal (name-calling), and rational (social isolation) which are typically known as traditional bullying or cyber bullying which occurs on the internet (Wang, Nansel, Lannotti, 2011). The purpose of the paper is to examine the situations and contexts that promote cyber and traditional bullying by reviewing studies that suggest (1) increased technologyRead MoreCyber Bullying Must Be Improved And Consistent1267 Words Ã‚ |Ã‚ 6 PagesJanuary 2015 Cyber Bullying Have you ever been cyber bullied? The effects of cyberbullying are greater than many people have come to realize. Cyber bullies have been around for a long time, but technology now gives them a whole new way to get to their victims easier and faster. Cyberbullying is the use of information technology to repeatedly harm or harass other people in a deliberate manner (abouthealth). Cyberbullying happens when kids bully each other through electronic technology. The consequencesRead MoreThe Internet and Cyberbullying Essay576 Words Ã‚ |Ã‚ 3 PagesCyber Bullying Nowadays, the Internet is regarded as the most widely used source of social media and the fastest way to exchange knowledge and information all over the world, playing a vital role in everyoneÃ¢â‚¬â„¢s daily life. The internet has countless functions, useful for everyday work and entertainment, but it is being abused by people nowadays. One of the ways it is being abused is by cyber bullying. Cyber bullying is when people use the internet to make fun of others, belittle them, andRead MoreBullying and the Internet Technology is and will be constantly changing, because of this cyber1500 Words Ã‚ |Ã‚ 6 PagesBullying and the Internet Technology is and will be constantly changing, because of this cyber bullying is becoming more of a problem. Some advances in technology like being able to have x-rays, MRIÃ¢â‚¬â„¢s have had a positive affect, while others like the cell phone, and social media have not. In about the last 25 years bullying has evolved from being picked on at school to being harassed through things like text messaging, social media, and email. In the past, bullying could happen anywhere like onRead MoreCyberbullying And Its Effect On Society893 Words Ã‚ |Ã‚ 4 Pagesmodern technology pose a new challenge in todayÃ¢â‚¬â„¢s society. It affects not only students, but adults and teachers alike in contesting what is commonly known as cyberbullying. Cyberbullying can be defined as the willful and repeated use of cellphones, computers, and other electronic communication devices to harass and threaten others. (McQuade, 2006) Because we live in a cyber society, nearly anyone can become a victim of cyber bullying. It is important to distinguish the difference between cyber harassmentRead More Cyber Bullying Essay1419 Words Ã‚ |Ã‚ 6 Pages The rise in technology has influenced our lives with the use of social networking sites and electronic devices predominant with todayÃ¢â‚¬â„¢s youth. What many adults are unaware of is bullying exists in many forms and is more common in the cyber world. In 2012, CBC news reporter Joan L eishman , aired Ã¢â‚¬Å"Cyber-bullying,Ã¢â‚¬ she describes a story about a student named David KnightÃ¢â‚¬â„¢s unbearable life entering the Internet. Later in 2014, Rachel Simmons, a former Rhodes Scholar and the founding directorRead MoreCyber Bullying And Its Effects On Its Victims1651 Words Ã‚ |Ã‚ 7 Pagestechnological advances that are creating, changing and shifting the individuals who live in it, especially cyber bullying. With the rise in the use of technology, digital culture and anonymity, cyber bullying has become a prominent issue that can have negative psychological effects on its victims through the power of these technological advances. This new 21st century term is derived from standard physical bullying has become a prominent and revolving issue as cellphone, texting and social media sites take away

Sunday, December 15, 2019

GhostÃ¢â‚¬â„¢s Child Essay Free Essays

Feather made the right choice, he should not have stayed with Maddy. Intro: Sonya HartnettÃ¢â‚¬â„¢s The GhostÃ¢â‚¬â„¢s Child reveals the mystifying story of MatildaÃ¢â‚¬â„¢s remarkable journey up the mountain of life. Even though the departure of Feather pained Maddy emotionally, the overall outcome significantly boosted her emotional strength and confidence. We will write a custom essay sample on GhostÃ¢â‚¬â„¢s Child Essay or any similar topic only for you Order Now Feather loved Maddy so much, but he knew he couldnÃ¢â‚¬â„¢t change, so he had to do what was best for Maddy in order for her to be happy. The loss of Feather as well as the Fay encouraged Maddy to embark on many new adventures. At the end of MatildaÃ¢â‚¬â„¢s glorious journey of life, she was, truly, happy. BP1: All Feather wanted was for Maddy to be happy, and the only way that was possible was to free her from herself by leaving her and letting her go. Maddy had thought that because of all the times he crept off to the beach, and to be with just the water and sand, that Ã¢â‚¬Å"Feather didnÃ¢â‚¬â„¢t careÃ¢â‚¬ about her, but it was not her, it was that Maddy was Ã¢â‚¬Å"less important than this strange, mysterious summoning thingÃ¢â‚¬ . Feather knew he couldnÃ¢â‚¬â„¢t change his lifestyle to live with Maddy, and if he didnÃ¢â‚¬â„¢t, he would continue to hurt her inside. The only way to satisfy them both was to leave. It was not the fact that Feather could not change for Maddy, but that he could not change enough for Maddy. Feather is willing to do anything for Maddy to Ã¢â‚¬Å"make her happyÃ¢â‚¬ . Even when he says that Ã¢â‚¬Å"it makes no differenceÃ¢â‚¬ to him, it actually does, and he knows that if he does Ã¢â‚¬Å"move to the desertÃ¢â‚¬ with Maddy, they wonÃ¢â‚¬â„¢t be able to live happily together because of Feathers urge to get back to his old life. Maddy was holding Feather back by making him more civilized and changing him to be the opposite of the person she fell in love with. After living with Feather for quite a while, Maddy Ã¢â‚¬Å"still called him Feather, but it was easy to forget whyÃ¢â‚¬ because of the new clothes she made him wear and his hair was washed and looked smart, and he had just lost the Ã¢â‚¬Å"strange smoky shimmer that swam from himÃ¢â‚¬ like the sun reflecting off a gold fish, in clear blue water. This shows that Feather left Maddy, not only to help her be happy, but also to let himself be happy. BP2: When Feather left Maddy, he freed her from the windowless Ã¢â‚¬Å"boxÃ¢â‚¬ inside her head, and enabled her to live life without worrying about love or oss, and as a result Maddy proceeded to have many great experiences that heavily influenced her life. The loss of Feather strived Maddy to actually do something with her life, rather than dwelling on all of the bad things that have happened. Whether Feather meant to or not, he enabled Maddy to fight for what she wanted, and actually do the things she wanted to do right now. The Ã¢â‚¬Å"i sland of stillnessÃ¢â‚¬ gave Maddy many new experiences and helped her learn a lot from them. The most vital thing that Maddy learns on the island is that Ã¢â‚¬Å"love is not the strongest or most important thing in the worldÃ¢â‚¬ . She accepted the fact that she had lost the Fay, and now was losing Feather. After learning this she can properly move on with her life and leave Feather and all their memories together in the past. Maddy going to help with the war was a very significant experience as it gave her the epiphany that she wanted to be an eye doctor for the remainder of her career. She was inspired by the fact that the blind injured men in the war had lost the biggest thing of all, Ã¢â‚¬Å"they had lost the sight of beautiful thingsÃ¢â‚¬ . This tells us that one bad experience, can often lead to several good life changing experiences BP3: In the end, all of MatildaÃ¢â‚¬â„¢s great journeys and adventures love and loss, finally enabled her to accept that the loss of Feather did help her learn to be happy. Love can be brutal and leave you injured, but eventually we learn that we can move past this and learn from our experiences to help us become wiser more knowledgeable. Through all the amazing good times, and the ever-lasting bad times, all MatildaÃ¢â‚¬â„¢s memories made up an overall happy life. After the island of stillness and the war, Maddy was living her perfect life, a job she wanted to do and nothing to worry about. It is strange to think of the outcome if she was still living with Feather, and if she would be doing what she was doing now. In the end, all alone Ã¢â‚¬Å"Matilda was standing on the mountain top, and looking back along the path sheÃ¢â‚¬â„¢d walked and she was satisfied with what she saw. Ã¢â‚¬ Feather leaving, not only hurt Maddy, but more importantly it taught her valuable lessons in life and gave her many amazing experiences. Sonya Hartnett was trying to explain that love can give you as much pain as it does happiness and to really experience great love, you must first experience the bad times as well as the good. Even if something bad does happen and you end up losing the one thing you love most, you must accept the fact that it has happened and that you cannot change it, and use it as a learning experience. No matter what happens, you have to learn to move on and enjoy all of the good things in life. As MatildaÃ¢â‚¬â„¢s eyes saw the last things they would ever see, Ã¢â‚¬Å"on her face were the remnants of a smileÃ¢â‚¬ . How to cite GhostÃ¢â‚¬â„¢s Child Essay, Essay examples

Saturday, December 7, 2019

Hofstede and GLOBE National Culture Models Ã¢â‚¬ MyAssignmenthelp.com

Question: Discuss about the Hofstede and GLOBE National Culture Models. Answer: Introduction: We are living in a global era whereby all people are brought together and closer by technology. This implies that people from different cultures are working together and communicating to their colleagues more and more (Hofstede et al., 2010, p. 350). Despite this being exciting, it could turn out to be frustrating and fraught with uncertainty. How does a person relate to another of a different culture management? What does he/she say or not say to start a conversation? Are there any culture-bound taboos that one has to be aware of or not? Establishing connections with different people from varying cultural backgrounds is important to an organization. Building connections is a factor to consider when motivating personnel, structuring projects, and implementing strategies (Tung and Verbeke, 2010, p. 33). How we understand cultural differences is relegated to learning from our mistakes and the general guidelines that have to be followed. Fortunately, Hofstede researched these questions in the 1970s. What emerged after ten years of research and thousands of interviews was a cultural dimension model that today is internationally recognized as a business standard management. Hofstede accessed people working in the same company in over 40 countries where he gathered cultural data and proceeded to analyze his findings (Valente, 2010, p. 1900). Initially, he identified four cultural dimensions that help in differentiating one culture from the rest. He later added a 5th dimension that forms todays model. Hofstede scored every country on a scale of 0 to 100 for the five dimensions (Hofstede, 2010, p. 55). The higher the score, the higher that dimension is manifest in the society and workplace. After gathering sufficient database about cultural statistics, He analyzed his results and found out that there were clear patterns of differences and similarities amid the responses along these 5 dimensions (Minkov and Hofstede, 2012, p. 10). Hofstede research was undertaken on IBM employees only, which enabled him to characterize the patterns of national differences in culture by significantly alleviating the challenge of the differences manifest in a company culture management. The five Hofstede dimensions are: Power or distance (PD) Individualism (IDV) Masculinity (MAS) Uncertainty or Avoidance Index (UAI) Long-term orientation (LTO) In todays workplaces, it has been interesting to see how employees with different cultures react and interact with foreign colleagues in their nation, including Australia. In Eastern Europe nations, the main reaction to foreign workers is age. However, given sufficient knowledge then knowledge is not a barrier to Hofstede dimensions. To begin with, Professor McSweeneys view of national cultures will be presented. The myth of national culture is nothing more than just the collection of media and social imaginings that live in a permanent exception to the realities of a nation. The exception is assumed to waterproof national culture against interaction with foreigners while destroying the meaning of nationals outside the national territory at the same time (Burgess and Gold, 2015, p. 40). The question about whether everything addressing this aforementioned reality is exceptional and contains local causes, then the much people know and think about national culture is dismissed with no validity beyond their borders. The myth states that a nation is like an orphan and in this case an orphan, or an autistic individual who faces massive challenges while attempting to establish a meaning outside the relationship with his/her state-territory-origin (Venaik and Brewer, 2013, p. 469). This is the reason why nation-states pr ovide themselves with the folklore of national animals that face death when they cross the States border, from the Purto Rican coquito the Iberian lynx, which is a Disneyfied model of the primary national virtue, being unable to exist outside of the borders of the State and its imagination. On the other hand, Hofstede survey on Australia provides revealing results on national cultures. Hofstede generalizes about the whole national population in all countries using questionnaire responses from the IBM. There is no evidence that the feedback he gathers is nationally representative of all nations. His 5 model is based on assumptions that every person share a common national culture with the other people from other countries. Hofstedes assumption that all people are equally plausible like those of IBM is a myth and cannot be relied upon. Relying on his assumption requires people to assume that the average national culture is acceptable among all groups of people. However, there is no evidence based on sound reasoning that the average IBM responses reflected the national average. His assumption can be termed as a mere leap of faith. The IBM respondents were already permanently mentally programmed with three non-interacting culture hence subverting its reliability. Based on t hese justifications, Professor McSweeneys view on national cultures is more compelling than that of Hofstede (Venaik and Brewer, 2010, p. 88). Finally, a single culture can be applied in determining the actions of the entire population as postulated my Prof McSweeneys view on national cultures. Conclusion National culture has to be against the kind of activities that people do but has to be okay with them. People with different cultures are able to work together in a different country that offers a different cultural setting that all of the employees are comfortable with. In summary, national culture goes hand in hand with cultural differences, and this forms a national unity. Bibliography Burgess, J. and Gold, J.R. eds., 2015.Geography, the media, and popular culture. Routledge. Hofstede, G., 2010. Geert Hofstede. National cultural dimensions. Hofstede, G., Garibaldi de Hilal, A.V., Malvezzi, S., Tanure, B. and Vinken, H., 2010. Comparing regional cultures within a country: Lessons from Brazil.Journal of Cross-Cultural Psychology,41(3), pp.336-352. https://geert-hofstede.com/countries.html https://www.youtube.com/watch?v=u_l84Dj2eXY Minkov, M. and Hofstede, G., 2012. Hofstedes fifth dimension: New evidence from the World Values Survey.Journal of cross-cultural psychology,43(1), pp.3-14. Tung, R.L., and Verbeke, A., 2010. Beyond Hofstede and GLOBE: Improving the quality of cross-cultural research. Valente, J., 2010.The myth of manliness in Irish national culture, 1880-1922. University of Illinois Press. Venaik, S. and Brewer, P., 2010. Avoiding uncertainty in Hofstede and GLOBE.Journal of International Business Studies,41(8), pp.1294-1315. Venaik, S. and Brewer, P., 2013. Critical issues in the Hofstede and GLOBE national culture models.International Marketing Review,30(5), pp.469-482.

Friday, November 29, 2019

Acca Questions Lrp Essay Example

Acca Questions Lrp Essay Ã¢â‚¬ËœIn the broadest sense, all accounting is management accounting. All financial and cost information generated by accountants is of some interest to management. But, in practice, where management accounting differs from financial accounting Ã¢â‚¬â„¢ (from An Insight into Management Accounting by John Sizer) Required: (a) (b) Give a brief definition of management accounting. 6 marks) Give a discussion of the major differences between management and financial accounting. (20 marks) (Total: 25 marks) 2 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS A COLLEGE A college offers a range of degree courses. The college organisation structure consists of three faculties, each with a number of teaching departments. In addition, there is an administrative/management function and a central services function. The following cost information is available for the year ended 30 June 20X7: (1) Occupancy costs Total ? 1,500,000. Such costs are apportioned on the basis of area used which is: Square feet Faculties 7,500 Teaching departments 20,000 Administration/management 7,000 Central services 3,000 (2) Administration/management costs Direct costs: ? 1,775,000. Indirect costs: an apportionment of occupancy costs. Direct and indirect costs are charged to degree courses on a percentage basis. (3) Faculty costs Direct costs: ? 700,000. Indirect costs: an apportionment of occupancy costs and central service costs. Direct and indirect costs are charged to teaching departments. (4) Teaching departments Direct costs: ? ,525,000. Indirect costs: an apportionment of occupancy costs and central service costs plus all faculty costs. Direct and indirect costs are charged to degree courses on a percentage basis. (5) Central services Direct costs: ? 1,000,000. Indirect costs: an apportionment of occupancy costs. Direct and indirect costs of central services have in previous years been charged to users on a percentage basi s. A study has now been completed which has estimated what user areas would have paid external suppliers for the same services on an individual basis. We will write a custom essay sample on Acca Questions Lrp specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Acca Questions Lrp specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Acca Questions Lrp specifically for you FOR ONLY $16.38 $13.9/page Hire Writer For the year ended 30 June 20X7, the apportionment of the central services cost is to be recalculated in a manner which recognises the cost savings achieved by using the central services facilities instead of using external service companies. This is to be done by apportioning the overall savings to user areas in proportion to their share of the estimated external costs. KAPLAN PUBLISHING 3 PAPER F5 : PERFORMANCE MANAGEMENT The estimated external costs of service provision are as follows: ? 00 Faculties 240 Teaching departments 800 Degree courses: Business studies 32 Mechanical engineering 48 Catering studies 32 All other degrees 448 ____ 1,600 ____ (6) Additional data relating to the degree courses are as follows: Degree course Business Mechanical Studies Engineering Number of graduates 80 50 Apportioned costs (as % of totals) Teaching departments 3% 2. 5% Administration/management 2. 5% 5% Central services are to be apportioned as detailed in (5) above. The total number of graduate s from the college in the year to 30 June 20X7 was 2,500. Required: (a) (b) Prepare a flow diagram which shows the apportionment of costs to user areas. No values need be shown. (5 marks) Calculate the average cost per graduate, for the year ended 30 June 20X7, for the college and for each of the degrees in business studies, mechanical engineering and catering studies, showing all relevant cost analysis. (15 marks) Suggest reasons for any differences in the average cost per graduate from one degree to another, and discuss briefly the relevance of such information to the college management. (5 marks) (Total: 25 marks) Catering Studies 120 7% 4% c) 4 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS ADMER Admer owns several home furnishing stores. In each store, consultations, if needed, are undertaken by specialists, who also visit potential customers in their homes, using specialist software to help customers realise their design objectives. Customers visit the store to make their selections from the wide range of goods offered, a fter which sales staff collect payment and raise a purchase order. Customers then collect their self-assembly goods from the warehouse, using the purchase order as authority to collect. Administration staff process purchase orders and also arrange consultations. Each store operates an absorption costing system and costs other than the cost of goods sold are apportioned on the basis of sales floor area. Results for one of AdmerÃ¢â‚¬â„¢s stores for the last three months are as follows: Department Kitchens $ Sales Cost of goods sold Other costs Profit/(loss) 210,000 63,000 130,250 _______ 16,750 _______ Bathrooms $ 112,500 137,500 81,406 _______ (6,406) _______ Dining Rooms $ 440,000 176,000 113,968 _______ 150,032 _______ Total $ 762,500 276,500 325,624 _______ 160,376 _______ The management accountant of Admer is concerned that the bathrooms department of the store has been showing a loss for some time, and is considering a proposal to close the bathrooms department in order to concentrate on the more profitable kitchens and dining rooms departments. He has found that other costs for this store for the last three months are made up of: $ Employees Sales staff wages Consultation staff wages Warehouse staff wages Administration staff wages General overheads (light, heat, rates, etc. ) 164,800 124,960 130,240 130,624 175,000 _______ 325,624 _______ 12 4 6 4 KAPLAN PUBLISHING 5 PAPER F5 : PERFORMANCE MANAGEMENT He has also collected the following information for the last three months: Department Number of items sold Purchase orders Floor area metres) Number consultations (square of Kitchens 1,000 1,000 16,000 798 Bathrooms 1,500 900 10,000 200 Dining Rooms 4,000 2,500 14,000 250 The management accountant believes that he can use this information to review the storeÃ¢â‚¬â„¢s performance in the last three months from an activity-based costing (ABC) perspective. Required: (a) (b) Discuss the management accountantÃ¢â‚¬â„¢s belief that the information provided can be used in an activity-based costing analysis. 4 marks) Explain and illustrate, using supporting calculations, how an ABC profit statement might be produced from the information provided. Clearly explain the reasons behind your choice of cost drivers. (8 marks) Evaluate and discuss the proposal to close the bathrooms department. (6 marks) (c) (d) Discuss the advantages and disadvantages that may arise for Admer from introducing activity-based costing in its stores. (7 marks) (Total: 25 marks) 6 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS QP PLC QP plc is a food processing company that produces pre-prepared meals for sale to consumers through a number of different supermarkets. The company specialises in three particular preprepared meals and has invested significantly in modern manufacturing processes to ensure a high quality product. The company is very aware of the importance of training and retaining high quality staff in all areas of the company and, in order to ensure their production employeesÃ¢â‚¬â„¢ commitment to the company, the employees are guaranteed a weekly salary that is equivalent to their normal working hours paid at their normal hourly rate of ? 7 per hour. The meals are produced in batches of 100 units. Costs and selling prices per batch are as follows: Meal Selling price Ingredient K (? /kg) Ingredient L (? 10/kg) Ingredient M (? 15/kg) Labour (? 7/hour) Factory costs absorbed Required: (a) (b) State the principles of throughput accounting and the effects of using it for short-term (6 marks) decision making. QP plc is preparing its production plans for the next three months and has estimated the maximum demand from its customers to be a s follows: TR PN BE 500 batches 400 batches 350 batches TR ? /batch 340 150 70 30 21 20 PN ? /batch 450 120 90 75 28 80 BE ? /batch 270 90 40 45 42 40 QP plc has adopted throughput accounting for its short-term decisions. These demand maximums are amended figures because a customer has just delayed its request for a large order and QP has unusually got some spare capacity over the next three months. However, these demand maximums do include a contract for the delivery of 50 batches of each to an important customer. If this minimum contract is not satisfied, then QP plc will have to pay a substantial financial penalty for nondelivery. The Production Director is concerned at hearing news that two of the ingredients used are expected to be in short supply for the next three months. QP plc does not hold inventory f these ingredients and, although there are no supply problems for ingredient K, the supplies of ingredients L and M are expected to be limited to: Ingredient L Ingredient M 7,000 kilos 3,000 kilos The Production Director has researched the problem and found that ingredient V can be used as a direct substitute for ingredient M. It also costs the same as ingredient M. There is an unlimited supply of ingredient V. Required: Prepare calculations to determine the production mix that will maximise the profit of QP plc during the next three months. (10 marks) KAPLAN PUBLISHING 7 PAPER F5 : PERFORMANCE MANAGEMENT c) The World Health Organization has now announced that ingredient V contains dangerously high levels of a chemical that can cause life-threatening illnesses. As a consequence it can no longer be used in the production of food. As a result, the production director has determined the optimal solution to the companyÃ¢â‚¬â„¢s production mix problem using linear programming. This is set out below: Objective function value TR value PN value BE value TR slack value PN slack value BE slack value L shadow price value M shadow price value Required: Explain the meaning of each of the values contained in the above solution. 9 marks) (Total: 25 marks) 110,714 500 357 71 0 43 279 3 28 8 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS MN LTD MN Ltd manufactures automated in dustrial trolleys, known as TRLs. Each TRL sells for ? 2,000 and the material cost per unit is ? 600. Labour and variable overhead are ? 5,500 and ? 8,000 per week respectively. Fixed production costs are ? 450,000 per annum and marketing and administrative costs are ? 265,000 per annum. The trolleys are made on three different machines. Machine X makes the four frame panels required for each TRL. Its maximum output is 180 frame panels per week. Machine X is old and unreliable and it breaks down from time to time. It is estimated that, on average, between 15 and 20 hours of production are lost per month. Machine Y can manufacture parts for 52 TRLs per week and Machine Z, which is old but reasonably reliable, can process and assemble 30 TRLs per week. The company has recently introduced a just-in-time (JIT) system and it is company policy to hold little work-in-progress and no finished goods stock from week to week. The company operates a 40-hour week, 48 weeks a year (12 months ? weeks) but cannot meet demand. The demand for the next year is predicted to be as follows. This is expected to be typical of the demand for the next four years: Units per week January February March April May June 30 30 33 36 39 44 July August September October November December Units per week 48 45 42 40 33 30 The production manager has suggested that the company replaces Machine Z with either Machin e F or Machine G. Machine F can process 36 TRLs per week and costs ? 330,000. It is expected that labour costs would increase by ? ,500 per week if Machine F were installed. Machine G can process 45 TRLs per week and costs ? 550,000. It is estimated that the variable overhead cost per week will increase by ? 4,500 if TRLs are made on Machine G. The maintenance manager is keen to spend ? 100,000 on a major overhaul of machine X Ã¢â‚¬â€œ he says this will make it 100% reliable. The management of MN Ltd is wondering whether it should now install a full standard costing and variance analysis system. At present, standard costs are calculated only as part of the annual budgeting process. Management is concerned about implementing so many changes in a short space of time, but feels the system could be very useful. The companyÃ¢â‚¬â„¢s cost of capital is 10% per annum. It evaluates projects over four years and depreciates its assets over five years. Required: Using the case of MN Ltd in the scenario above: (a) (b) (c) Explain the concept of throughput accounting. (6 marks) To what uses do advocates of throughput accounting suggest that the throughput ratio be put? (6 marks) Explain how the concept of contribution in throughput accounting differs from that in marginal costing. 7 marks) KAPLAN PUBLISHING 9 PAPER F5 : PERFORMANCE MANAGEMENT (d) If MN Ltd has decided to purchase Machine G and spend ? 100,000 on a major overhaul of Machine X, the management accountant and the production manager should collaborate to ensure a new focus for monitoring and reporting production activities. What is the new focus? Explain what should be monitored and reported. 6 marks) (Total: 25 marks) 10 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS BML BML has three product lines: P1, P2 and P3. Since its creation the company has been using a single direct labour cost percentage to assign overhead costs to products. Despite P3, a relatively new line, attracting additional business, increasing overhead costs and a loss of market share, particularly for P2, a major product, have convinced the management that the costing system is in need of some development. A team, led by the management accountant was established to develop an improved system of costing based on activities. The team spent several weeks collecting data (see tables below) for the different activities and products. For the accounting period in question, given in the tables below is data on BMLÃ¢â‚¬â„¢s three product lines and overhead costs: P1 7,500 units ? 4 ? 18 ? 47 4 0. 5 1 30% 1 P2 12,500 units ? 8 ? 25 ? 80 25 0. 5 5 20% 7 P3 4,000 units ? 6. 40 ? 16 ? 68 50 0. 2 10 50% 22 Overhead cost ? 150,000 390,000 18,688 100,000 60,000 ___________ Production volume Direct labour cost per unit Material cost per unit Selling price per unit Materials movements (in total) Machine hours per unit Set-ups (in total) Proportion of engineering work Orders packed (in total) Activities Material receiving and handling Machine maintenance and depreciation Set-up labour Engineering Packing Total Required: (a) (b) 718,688 ___________ Calculate the overhead rate and the product unit costs under the existing costing system. (5 marks) Identify for each overhead activity, an appropriate cost driver from the information supplied, and then calculate the product unit costs using a system that assigns overheads on the basis of the use of activities. (11 marks) Comment on the results of the two costing systems in (a) and (b) above. 9 marks) (Total: 25 marks) (c) KAPLAN PUBLISHING 11 PAPER F5 : PERFORMANCE MANAGEMENT ABC PLC ABC plc, a group operating retail stores, is compiling its budget statements for 20X8. In this exercise revenues and costs at each store A, B and C are predicted. Additionally, all central costs of warehousing and a head office are allocated across the three stores in order to arrive at a total cost and net profit of each store operation. In earlier years th e central costs were allocated in total based on the total sales value of each store. But as a result of dissatisfaction expressed by some store managers alternative methods are to be evaluated. The predicted results before any re-allocation of central costs are as follows: A B ? 000 ? 000 Sales 5,000 4,000 Costs of sales 2,800 2,300 ____ ____ Gross margin Local operating expenses Variable Fixed Operating profit The central costs which are to be allocated are: ? 000 Warehouse costs: Depreciation Storage Operating and despatch Delivery Head office: Salaries Advertising Establishment Total 100 80 120 300 200 80 120 2,200 660 700 ___ 840 ___ 1,700 730 600 ___ 370 ___ C ? 00 3,000 1,900 ____ 1,100 310 500 ___ 290 ___ ________ ________ 1,000 The management accountant has carried out discussions with staff at all locations in order to identify more suitable Ã¢â‚¬Ëœcost driversÃ¢â‚¬â„¢ of some of the central costs. So far the following has been revealed: A B C Number of despatches 550 450 520 Total delivery distances (thousand miles) 70 50 90 Storage space occupied (%) 40 30 30 1 2 3 An analysis of senior management time revealed that 10% of their time was devoted to warehouse issues with the remainder shared equally between the three stores. It was agreed that the only basis on which to allocate the advertising costs was sales revenue. Establishment costs were mainly occupancy costs of senior management. This analysis has been carried out against a background of developments in the company, for example, automated warehousing and greater integration with suppliers. 12 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS Required: As the management accountant prepare a report for the management of the group which: (i) computes the budgeted net profit of each store based on the sales value allocation base originally adopted and explains Ã¢â‚¬Ëœcost driverÃ¢â‚¬â„¢, Ã¢â‚¬ËœvolumeÃ¢â‚¬â„¢ and Ã¢â‚¬ËœcomplexityÃ¢â‚¬â„¢ issues in relation to cost allocation commenting on the possible implications of the dissatisfaction expressed; (7 marks) computes the budgeted net profit of each store using the additional information provided, discusses the extent to which an improvement has been achieved in the information on the costs and profitability of running the stores and comments on the results. 14 marks) (ii) (b) Explain briefly how regression analysis and coefficient of determination (r2) could be used in confirming the delivery mileage allocation method used in (a) above. (4 marks) (Total: 25 marks) KAPLAN PUBLISHING 13 PAPER F5 : PERFORMANCE MANAGEMENT KEY FACTORS AND THROUGHPUT ACCOUNTING Sunglow Estates Com pany (SEL) has acquired a 600-hectare site comprising the following: Land groups (1) Agricultural land in current use (2) Derelict land formerly occupied by factories (3) Contaminated land formerly used for chemical storage 280 hectares 250 hectares 70 hectares It is possible for SEL to develop this site with a combination of houses, apartments and shops. The associated development costs per hectare are as follows: Houses Land group (1) (2) (3) $000 370 340 ? Apartments $000 715 640 ? 820. 52 It is not possible to use land group (3) for houses or apartments, but this land can be used for the development of shops without first decontaminating it. Income per hectare generated by the three types of development are: Sale of leases $000 Houses Apartments Shops 230 480 ? Annual ground rent $000 40 70 200 Shops $000 790 698 SELÃ¢â‚¬â„¢s planning consent for the development specifies that no more than 40 hectares of the development should be occupied by shops and no less than 200 hectares should be occupied by houses. Land developed for houses in excess of the minimum specified by the planning consent will qualify for a government subsidy in the form of an interest-free loan of $200,000 per hectare developed, repayable in four annual instalments of $50,000. It is possible to decontaminate all or part of land group (3) at a cost of $80,000 per hectare. Such decontaminated land is, for development purposes, the same as agricultural land. SEL appraises investments using DCF evaluation, a 10% cost of money for low-risk investments (including development of houses and apartments), a 15% cost of money for high-risk investments (including the development of shops) and an eight-year time horizon. Ã¢â‚¬ËœI remember being told about the useful decision-making technique of limiting factor analysis (also known as Ã¢â‚¬Ëœcontribution per unit of the key factorÃ¢â‚¬â„¢). If an organisation is prepared to believe that, in the short run, all costs other than direct materials are fixed costs, is this not the same thing that throughput accounting is talking about? Why rename limiting factor analysis as throughput accounting? Ã¢â‚¬â„¢ 14 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS Required: (a) Explain what a limiting (or Ã¢â‚¬ËœkeyÃ¢â‚¬â„¢) factor is and what sort of things can become limiting factors in a business situation. Which of the factors in the scenario could become a limiting factor? (8 marks) Explain the techniques that have been developed to assist in business decision-making when single or multiple limiting factors are encountered. (7 marks) Explain the management idea known as throughput accounting. State and justify your opinion on whether or not throughput accounting and limiting factor analysis are the same thing. Briefly comment on whether throughput accounting is likely to be of relevance to SEL. (10 marks) (Total: 25 marks) (b) (c) KAPLAN PUBLISHING 15 PAPER F5 : PERFORMANCE MANAGEMENT DECISION MAKING TECHNIQUES JB LTD JB Ltd is a small specialist manufacturer of electronic components and much of its output is used by the makers of aircraft for both civil and military purposes. One of the few aircraft manufacturers has offered a contract to JB Ltd for the supply, over the next 12 months, of 400 identical components. The data relating to the production of each component is as follows: (1) Material requirements 3 kg material M1 Ã¢â‚¬â€œ see note (i) below 2 kg material P2 Ã¢â‚¬â€œ see note (ii) below 1 part no. 678 Ã¢â‚¬â€œ see note (iii) below Notes: (i) Material M1 is in continuous use by the company. 1,000 kg are currently held in stock at a book value of ? 4. 70/kg but it is known that future purchases will cost ? 5. 50/kg. 1,200 kg of material P2 are held in stock. The original cost of this material was ? 4. 30/kg but, as the material has not been required for the last two years, it has been written down to ? 1. 50/kg scrap value. The only foreseeable alternative use is as a substitute for material P4 (in current use) but this would involve further processing costs of ? 1. 60/kg. The current cost of material P4 is ? 3. 60/kg. It is estimated that the part no. 678 could be bought for ? 50 each. (ii) (iii) (2) Labour requirements Each component would require five hours of skilled labour and five hours of semiskilled. An employee possessing the necessary skills is available and is currently paid ? 5/hour. A replacement would, however, have to be obtained at a rate of ? 4/hour for the work which would otherwise be done by the skilled employee. The current rate for semi-skilled work is ? 3/hour and an additional employee could be appointed for this work. (3) Overhead JB Ltd absorbs overhead by a machine hour rate, currently ? 20/hour, of which ? 7 is for variable overhead and ? 13 for fixed overhead. If this contract is undertaken, it is estimated that fixed costs will increase for the duration of the contract by ? 3,200. Spare machine capacity is available and each component would require four machine hours. A price of ? 145 per component has been suggested by the large company which makes aircraft. Required: (a) (b) State whether or not the contract should be accepted and support your conclusion with (16 marks) appropriate figures for presentation to management; Comment briefly on three factors which management ought to consider and which may influence their decision. (9 marks) (Total: 25 marks) 16 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS EXE AND WYE A firm manufactures two products, EXE and WYE, in departments dedicated exclusively to them. There are also three service departments, stores, maintenance and administration. No stocks are held as the products deteriorate rapidly. Direct costs of the products, which are variable in the context of the whole business, are identified to each department. The step-wise apportionment of service department costs to the manufacturing departments is based on estimates of the usage of the service provided. These are expressed as percentages and assumed to be reliable over the current capacity range. The general factory overheads of ? 3. 6m, which are fixed, are apportioned based on floor space occupied. The company establishes product costs based on budgeted volume and marks up these costs by 25% in order to set target selling prices. Extracts from the budgets for 20X8 are provided below: Annual volume (units) EXE WYE 200,000 100,000 150,000 70,000 EXE Costs (? m) Material costs Other variable costs Departmental usage (%) Maintenance Administration Stores Floor space (sq m) Required: Workings may be ? 000 with unit prices to the nearest penny. (a) (b) Calculate the budgeted selling price of one unit of EXE and WYE based on the usual mark up. (6 marks) Discuss how the company may respond to each of the following independent events, which represent additional business opportunities: (i) (ii) an enquiry from an overseas customer for 3,000 units only of WYE where a price of ? 5 per unit is offered an enquiry for 50,000 units of WYE to be supplied in full at regular intervals during 20X8 at a price which is equivalent to full cost plus 10%. 1. 8 0. 8 50 40 60 640 WYE 0. 7 0. 5 25 30 40 480 Stores 0. 1 0. 1 25 20 240 Maintenance 0. 1 0. 2 Admin Ã¢â‚¬â€œ 0. 2 Maximum capacity Budget 10 80 160 In both cases support your d iscussion with calculations and comment on any assumptions or matters on which you would seek clarification. (13 marks) (c) Explain the implications of preparing product full costs based on maximum capacity rather than annual budget volume. (6 marks) (Total: 25 marks) KAPLAN PUBLISHING 7 PAPER F5 : PERFORMANCE MANAGEMENT PLASTIC TOOLS A small company is engaged in the production of plastic tools for the garden. Sub-totals on the spreadsheet of budgeted overheads for a year reveal the following: Moulding department 1,600 2,500 0,800 1,200 Finishing department 500 850 600 800 General factory overhead 1,050 1,750 Variable overhead ? 000s Fixed overhead ? 000s Budgeted activity Machine hours (000s) Practical capacity Machine hours (000s) For the purposes of reallocation of general factory overhead it is agreed that the variable overheads accrue in line with the machine hours worked in each department. General factory fixed overhead is to be reallocated on the basis of the practical machine hour capacity of the two departments. It has been a long-standing company practice to establish selling prices by applying a mark-up on full manufacturing cost of between 25% and 35%. A possible price is sought for one new product which is in a final development stage. The total market for this product is estimated at 200,000 units per annum. Market research indicates that the company could expect to obtain and hold about 10% of the market. It is hoped the product will offer some improvement over competitorsÃ¢â‚¬â„¢ products, which are currently marketed at between ? 90 and ? 100 each. The product development department have determined that the direct material content is ? 9 per unit. Each unit of the product will take two labour hours (four machine hours) in the moulding department and three labour hours (three machine hours) in finishing. Hourly labour rates are ? 5. 00 and ? 5. 50 respectively. Management estimate that the annual fixed costs which would be specifically incurred in relation to the product are: supervision ? 20,000, depreciation of a recently acquired machine ? 20,000 and advertising ? 27,000. It may be assumed that these costs are included in the budget given above. Given the state of development of this new product, management do not consider it necessary to make revisions, to the budgeted activity levels given above, for any possible extra machine hours involved in its manufacture. Required: (a) (b) (c) Briefly explain the role of costs in pricing. (8 marks) Prepare full cost and marginal cost information which may help with the pricing decision. (10 marks) Comment on the cost information and suggest a price range which should be considered. marks) (Total: 25 marks) 18 KAPLAN PUBLISHING LECTURER RESOURCE PACK Ã¢â‚¬â€œ QUESTIONS BIL MOTOR COMPONENTS PLC (a) In an attempt to win over key customers in the motor industry and to increase its market share, BIL Motor Components plc have decided to charge a price lower than their normal price for component TD463 when selling to the key customers who are being targeted. Details of component TD463Ã¢â‚¬â„¢s standard costs are as follows: Standard cost data Machine Group 1 ? Materials (per unit) 26. 00 Labour (per unit) 2. 00 Variable overheads (per unit) 0. 65 Fixed overheads (per unit) 3. 00 _____ 31. 5 _____ Setting-up costs per batch of 200 units Required: Compute the lowest selling price at which one batch of 200 units could be offer ed, (9 marks) and critically evaluate the adoption of such a pricing policy. (b) The company is also considering the launch of a new product, component TDX489, and have provided you with the following information. Product TDX489 Standard cost per box ? 6. 20 1. 60 ____ 7. 80 ____ Market research ? forecast of demand Selling price (? ) 13 12 11 10 9 Demand (boxes) 5,000 6,000 7,200 11,200 13,400 The company only has enough production capacity to make 7,000 boxes. However, it would be possible to purchase product TDX489 from a sub-contractor at ? 7. 75 per box for orders up to 5,000 boxes, and ? 7 per box if the orders exceed 5,000 boxes. Required: Prepare and present a computation which illustrates which price should be selected in order to maximise profits. (10 marks) (c) Where production capacity is the limiting factor, explain briefly the ways in which management can increase it without having to acquire more plant and machinery. (6 marks) (Total: 25 marks) ? 10 Component TD463 Batch size 200 units Machine Group 7 ? 17. 00 1. 60 0. 72 2. 50 _____ 21. 82 _____ ? 6 Machine Group 29 ? 0. 75 0. 80 1. 50 ____ 3. 05 ____ ? 4 Assembly ? 3. 00 1. 20 0. 36 0. 84 ____ 5. 40 ____ ? Variable cost Fixed cost KAPLAN PUBLISHING 19 PAPER F5 : PERFORMANCE MANAGEMENT MOV COMPANY MOV Company produces custom-built sensors. Each sensor has a standard circuit board (SCB) in it. The current average contribution from a sensor is ? 400. MOV CompanyÃ¢â‚¬â„¢s busine ss is steadily expanding and in the year just ending (2001/2002), the company will have produced 55,000 sensors. The demand for MOV CompanyÃ¢â‚¬â„¢s sensors is predicted to grow over the next three years: Year 2008/09 2009/10 2010/11 Units 58,000 62,000 65,000 The production of sensors is limited by the number of SCBs the company can produce. The present production level of 55,000 SCBs is the maximum that can be produced without overtime working. Overtime could increase annual output to 60,500, allowing production of sensors to also increase to 60,500. However, the variable cost of SCBs produced in overtime would increase by ? 75 per unit. Because of the pressure on capacity, the company is considering having the SCBs manufactured by another company, CIR Company. This company is very reliable and produces products of good quality. CIR Company has quoted a price of ? 16 per SCB, for orders greater than 50,000 units a year. MOV CompanyÃ¢â‚¬â„¢s own costs per SCB are predicted to be: Direct material Direct labour Variable overhead Fixed overhead Total cost ? 28 40 20 24 112 (based on labour cost) (based on labour cost and output of 55,000 units) The fixed overheads directly attributable to SCBs are ? 250,000 a year; these costs will be avoide d if SCBs are not produced. If more than 59,000 units are produced, SCBsÃ¢â‚¬â„¢ fixed overheads will increase by ? 130,000. In addition to the above overheads, MOV CompanyÃ¢â‚¬â„¢s fixed overheads are predicted to be: Sensor production in units: Fixed overhead: 54,001 to 59,000 ? ,600,000 59,001 to 64,000 ? 2,900,000 64,001 to 70,000 ? 3,100,000 MOV Company currently holds a stock of 3,500 SCBs but the production manager feels that a stock of 8,000 should be held if they are bought-in; this would increase stockholding costs by ? 10,000 a year. A purchasing officer, who is paid ? 20,000 a year, spends 50% of her time on SCB duties. If the SCBs are bought-in, a liaison officer will have to be employed at a salary of ? 30,000 in order to liaise with CIR Company and monitor the quality and supply of SCBs. At present, 88 staff are involved in the production of SCBs at an average salary of ? 5,000 a year: if the SCBs were purchased, 72 of these staff would be made redundant at an average cost of ? 4,000 per employee. The SCB department, which occupies an area of 240 ? 120 square metres at the far end of the factory, could be rented out, at a rent of ? 45 per square metre a year. However, if the SCBs were to be bought-in, for the first year only MOV Company would need the space to store the increased stock caused by outsourcing, until the main stockroom had been reorganised and refurbished. From 2009/10, the space could be rented out; this would limit the annual production of

Monday, November 25, 2019

Healthy Food and Junk Food Essays

Healthy Food and Junk Food Essays Healthy Food and Junk Food Paper Healthy Food and Junk Food Paper Healthy Food and Junk Food: An Annotated Bibliography This article discusses the effects of eating junk food on childrenÃ¢â‚¬â„¢s development, health, and behavior. It provides the physiological and psychological effects of junk food eating. The article points out the demise of the traditional value of dining because of the preference for junk food. It cites the common diseases that children may experience later on in their lives out of their habit of eating junk food. Food to Have Sometimes.Ã‚ March 2007. Better Health Channel. 13 November 2007 betterhealth.vic.gov.au/bhcv2/bhcarticles.nsf/pages/Food_to_have_sometimes?open. This fact sheet provides information regarding the common ingredients in junk food. It also discusses how these ingredients harm the body when consumed regularly. However, the fact sheet also states that eating junk food occasionally is still healthy. It suggests that the important thing is to eat healthy and natural food regularly and to moderate the intake of junk foods. Bauer, Joy. Can Junk Foods be Good for you? March 8, 2007. Ã‚ Today Show, MSNBC. 13 November 2007 http://today.msnbc.msn.com/id/17515303/. This article attempts to show that junk foods will never be good for an individual if taken excessively. With the emergence of healthy junk food, such as whole-grain, low-fat, or low-salt versions of the common types of junk food, Bauer answers the question, Ã¢â‚¬Å"Are these really healthy?Ã¢â‚¬ BauerÃ¢â‚¬â„¢s answer is no. In using the Krispy Kreme Whole Wheat Doughnut as an example, Bauer points out that despite the use of whole wheat, the doughnut has still a large amount of trans fat and still has a high calorie count.Ã‚ Basically, Bauer points out that there are no substitutes for the natural and more nutritious snacks like fruits and vegetables. More importantly, some treats are just meant to be taken occasionally, whatever vitamins, mineral or grains are added to them. Larsen, Joanne. Junk Foods. Ask the Dietitian. 13 November 2007 dietitian.com/junkfood.html. This article provides a definition of what junk food really is. Larsen describes junk foods as those that are high in sugar, salt, fat, or calories and have low nutrient content. Larsen states that junk foods usually have empty calories. Some of the common junk food are salted snack foods, candy, most sweet desserts, fried fast food, and carbonated beverages. The article then characterizes each of these. Also, the article lists down ways of how to identify junk food. It emphasizes the need to consult the nutritional label of each food item. It provides suggestions of how to classify foods as junk or not. Koh, Vivienne. The Battle Between Junk Food and Health Food. Ezine Articles. 13 November 2007 http://ezinearticles.com/?id=708154. This article describes junk foods. It provides a definition of what junk food really is. It lists down some reasons why junk foods are so popular. It cites the taste, price, and availability as common reasons for its popularity. Koh also identifies the reasons why junk foods should be avoided as much as possible. She points out the health hazards that can result out of eating too much junk food. She cites the common diseases and attributes these health hazards to the ingredients of these food items. The article ends with a call to consumers to be more wary of what they buy. It calls consumers to consult nutrition labels for medical bills are far more costly than junk food.

Friday, November 22, 2019

Text messaging and the positive effects on literature Essay

Text messaging and the positive effects on literature - Essay Example Some even stated that they extensively text message on a regular basis. When those young adolescents spoke up regarding the use of cell phones, we were not surprised when they stated that they are using text messages as a primary form of communication between friends and family. According to the Mobile Life Report, 52% of children consider text messaging their number one form of communication with their friends. (Dunstone, 2008) Another factor driving the widespread adoption of cell phone use is parents want their children to carry cell phones for safety reasons. In fact, parents often object to school policies that ban cell phones, staging rallies and threatening lawsuits (Wallace, P., 2011). So with such a wide spread implementation of cell phones being purchased by parents for their children, why is it so hard to understand that children and adults are going to be using mobile devices as a primary form of communication? As you will see in this paper, using cell phones can actually improve the literacy of the users when text messages are the primary source of communication used. Even though text messaging can cause children and adults to use the abbreviated text spelling, text messaging its the largest form of communication for children and adults alike. Some studies have evidence that suggests that text messaging is positively affecting literacy skills in adults and children around the world. As many parents and teachers know, keeping an adolescent focused on learning to read is a daunting task. According to the Institute of Education Science, school, districts had total expenditures of approximately $596.6 billion in 2007Ã¢â‚¬â€œ08 in the United States. How much of that money goes into programs that are designed to keep young adolescents focused and motivated to learn? Why are the schools not using all the mobile technology at their fingertips? Students enjoy learning as

Wednesday, November 20, 2019

Segment 4,5,and 6 Term Paper Example | Topics and Well Written Essays - 1500 words

Segment 4,5,and 6 - Term Paper Example lberger recounts that the migrant passengers were Ã¢â‚¬Å"packed densely, like herringsÃ¢â‚¬ into the ships awaited them in harbors of Rotterdam and Amsterdam. Each person received no more than 2-ft. wide bedstead, as a typical ship carried over 400 to 600 passengers. The miseries of the passengers usually began in the Dutch waters already, as the ships were compelled to pass through 8-14-day long customs examination at British ports, as they arrived there. However, the real hardship was to begin during the voyage across the Atlantic, as the vessels carrying migrants took 8 to 12 weeks until they reached Philadelphia. During such trips, gales and epidemics often struck the passengers, leading to rather high mortality levels and general discontent. In particular, infants and 1 to 7 year-old children were rarely to survive such trip. The most degrading part of the voyage, nevertheless, was to begin in the harbor of Philadelphia, as the destitute passengers were effectively sold to those who could pay for their new servantsÃ¢â‚¬â„¢ passage money. Usually adult persons were to serve for 3 to 6 years for the benefit of their purchasers, while the adolescents could be purchased to serve until they would be 21 year old. During such sale procedures, whole families were frequently torn apart. Segment 5. William PittÃ¢â‚¬â„¢s Speech on the Stamp Act, 14 January 1766. This speech by William Pitt, Sr., who was at that time a leader of the Opposition, was to play one of the decisive roles in the repeal of the Stamp Act and the temporary softening of the British position with respect to the Colonies. Pitt pointed out that even Ã¢â‚¬Å"under former arbitrary reignsÃ¢â‚¬ it had been assumed that taxation entails the right of representation in the Parliament, and vice versa. He cited the example of Wales to show that the Colonists were right to demand the same attitude towards themselves. Pitt warned that the attempts of Ã¢â‚¬Å"the late administrationÃ¢â‚¬ to Ã¢â‚¬Å"robÃ¢â‚¬ the Colonies would be a dangerous

Monday, November 18, 2019

Pre-certification assignment Essay Example | Topics and Well Written Essays - 500 words

Pre-certification assignment - Essay Example In level 212 the patients reach 211 (1, 3 and 4,) the history of the patient also demonstrates the patient to have had episodes of sore throat with is a sign of tenderness of the tonsils. The patient also has difficulty in swallowing which is a typical sign of tonsillar enlargement. In addition, the patient presents with fever in the history. Finally, in level three, the patient seems to have taken two courses of antibiotics even though it is nonspecific; most strep antibiotics are 7 to 12 days The patient should have a history of snoring, bleeding, suspected sleep apnea hyponasal speech persistent drooling or more than six months accompanied by grade three or four tonsillar enlargements with the patient having normal palate This patient qualifies for the criteria 400 for the diagnosis of adenotonsillar hypertrophy. In 412, the patient snores a sign of sleep apnea she also has signs of bleeding. In 411, the speech is hyponasal with the sore strep throat; the patient, however, does not meet the level 413. 420 The patient also meets the criteria 413 as he has a 4+ tonsillar enlargement on the right that touches the uvula and 3+ in the left tonsil that is pink in appearance. The patient seems to meet the 430 criteria, as there is no physical pathology with the palate for it is not reported. In this, the assumption is that only the pathological findings are recorded. The patient, therefore, meets all the requirements for these criteria for the insurance cover The patient needs to present with symptoms of tonsillar history enlargement of grade 3 or for by physical exam. Besides, on the physical exam the patient should have a normal palate. Also, the patient needs to have history any of the following symptoms, bleeding, suspected sleep apnea hyponasal speech persistent drooling or more than six months. The patient meets the criteria for this

Saturday, November 16, 2019

Permanent versus Transitory Earnings and Security Valuation

Permanent versus Transitory Earnings and Security Valuation In this study we examine the role of permanent and transitory earnings and cash flows in explaining security r in three major capital markets, UK, USA and France. We hypothesize that the relationship between cash flows and security returns improves when earnings are transitory and this robustness is country specific. The dataset consists of more than 40,000 USA, UK and French firm-year observations over a nine year period. Multivariate statistical regression analysis is undertaken to test the major research hypotheses. Results indicate that when earnings are transitory (not stable), investors pay more attention to cash flows and less attention to earnings, a result indicating that investors penalize firms with unstable earnings. In summary, the evidence provided in this study supports that indeed there are substantial differences in the way investors and financial analysts perceive financial information such as earnings and cash flows in the UK, France and the USA. These results shou ld be of great importance to the major stakeholders such as investors, creditors, financial analysts, especially after the recent global financial crisis and the collapse of giant organizations worldwide. Keywords: Permanent and Transitory Earnings, Capital markets, Earnings, Cash flows, France, Empirical. * Dr. Melita Charitou is an Assistant Professor of Finance and Accounting, University of Nicosia, Cyprus. Address for correspondence: Division of Finance and Economics, School of Business, University of Nicosia, Cyprus, email: [emailprotected] .1. INTRODUCTION Capital markets emphasized to a great extent the value relevance of earnings in the marketplace. The usefulness of earnings has also been examined recently in conjunction with cash flows (Bali et al (2009), Banker et al (2009), Bartov et al., 2001; Charitou et al., 2001, Ball et al., 2000, among others). Empirical research provided evidence to support that earnings are more useful than cash flows in the capital markets. Existing evidence on the association of operating cash flows beyond earnings in explaining security returns has been inconclusive. Furthermore, to date comparative international research on the value relevance of cash flows has been limited. Moreover, researchers argue that when aggregate data is used, it is assumed that the relationship between earnings and cash flows with security returns is homogeneous across firms. It should be noted that this assumption that investors react identically to earnings and cash flows of all firms is not that pragmatic.The present stud y hypothesizes the value relevance of earnings and cash flows is country specific and it depends on the transitoriness of earnings. Earnings persistence studies consistently report that earnings persistence is significantly positively associated with ERC (Easton and Zmijewski, 1989; Donnelly and Walker, 1995; Ali and Zarowin, 1992; Chambers, 2004). Cheng et al. (1996) extended prior studies on this topic and added cash flow variables in their models. They found that the incremental information content of cash flow from operations(CFO) should increase with a decrease in the permanence of earnings. Furthermore, Ali (1994) using non-linear models concluded that earnings, cash flows and working capital from operations(WCFO) have incremental information, which increases the lower are the absolute changes in earnings, cash flows and WCFO respectively. Finally, Ali and Zarowin (1992) show that the more transitory the previous periods earnings are, the greater the increase in the ERC and the expected incremental explanatory power from inclusion of the level variable. According to Cho and Chung (1991) the persistence meas ure used in those studies has 3 limitations: first, although persistence is changing over time, a constant parameter assumption is made which is problematic, especially when estimations are based on annual data for several year time series. Second, a measurement error problem exists, from using time-series reported earnings. Easton and Zmijewski (1989) use revision coefficient avoiding to some extend the latter problem. The third limitation is that persistence as measured by the time series of earnings is a crude proxy for the construct because it contains little economic content. Researchers also extended prior studies in order to examine the value relevance of the permanent and transitory earnings. Cheng et al (1996), Ali (1994), Ali and Zarowin (1992) and Easton and Zmijewski (1989) among others examine the impact of permanent and transitory earnings on the relations between returns and earnings or between returns and cash flows. Ali and Zarowin (1992) concluded that for firms with permanent earnings in the previous period, when the earnings level variable is included in the model, the incremental explanatory power and the increase in Earnings Response Coefficient (ERC) are small. Cheng et al. (1996) investigated whether the incremental information content of cash flows increases when earnings are transitory. Transitory earnings have smaller marginal impact on security returns. Moreover, their results showed that the incremental information content of accounting earnings decreases, and the incremental information content of cash flows increases with a decre ase in the permanence of earnings. Regression analysis was undertaken to test the major hypothesis. A sample of more than 40,000 USA, UK and French firm year observations was used to test the research hypotheses. The major conclusions of the empirical results are summarized as follows. First, regarding our basic proposition which stated that earnings and cash flows are associated with stock prices in USA, UK and France, results indicate that indeed both earnings and cash flows are taken into consideration by investors in their investment decisions. Second, regarding our major hypothesis which stated that the value relevance of earnings and cash flows is country specific and depends on the transitoriness of earnings, results indicate that when earnings are transitory (not stable), investors pay more attention to cash flows and less attention to earnings, a result indicating that investors penalize firms with unstable earnings. In summary, evidence provided in this study supports that indeed there are substantial differences in the way investors and financial analysts perceive financial information such as earnings and cash flows in UK, France and USA and that the value relevance of cash flows depends on the transitoriness of earnings. .2. LITERATURE REVIEW and Hypotheses development. Earnings are of primary importance to managers, because managerial executive compensation contracts are usually based on earnings. Managers select financial reporting methods to maximize the value of their bonus awards through incentives created by bonus schemes. In addition, managers indulge in income smoothing, that is, taking actions to dampen fluctuations in their organizations earnings, as investors pay more for a firm with a smoother income stream (Dechow et al. 2003; Barth et al. 2005). In the past few years there has been an increased interest in the role of earnings and cash flows in explaining security returns. Contextual factors, such as earnings transitoriness, have a common objective. To identify specific circumstances where the value relevance of earnings and cash flows is altered (improves or deteriorates). Using USA data, Freeman and Tse (1992) and Ali (1994) showed that transitory earnings have smaller marginal impact on security returns. Cheng et al (1996) and Charitou et al (2001) extended these studies by hypothesizing that when earnings are transitory, the value relevance of earnings diminishes, whereas the value relevance of cash flows is expected to increase. Earnings transitoriness was measured as the earnings change scaled by the beginning of period price and also by the earnings to price ratio. Extreme values of these measures could be considered as an indication of earnings transitoriness. Transitory items are expected to have limited valuation implications. Examples of transitory items in earnings include current and long-term accruals such as losses due to restructuring, current recognition through asset sales of previous periods increases in market values, one time impact on income from changes in accounting standards. The results of the Cheng et al. (1996) study indicated that a) when level and changes in earnings and cash flows are included in the model, all are value relevant in the marketplace, and b) when earnings are transitory the value relevance of earnings diminishes substantially, and simultaneously the value relevance of cash flows increases. In summary, these results are indeed of great importance since earlier studies assumed that the earnings returns relation is homogeneous across firms. These studies, however, disprove this assumption and indeed show that the value relevance of earnings and cash flows depends on the permanence or transitoriness of these measures. The present study goes a step further to examine whether the value relevance of earnings and cash flows is country specific and whether it depends on the transitoriness of earnings. 2.2 Research HypothesIs Empirical evidence supports that earnings are valued more than cash flows in the marketplace. Extant evidence though on the incremental information content of cash flows beyond earnings in different countries when earnings are transitory has been inconclusive (Barth et al., 2004, Bartov et al., 2001). The inconclusive results in prior studies, and the limited research on this issue provide motivation for this study. The research hypothesis to be tested is: Hypothesis 1: The value relevance of cash flows improves when earnings are transitory, whereas the value relevance of earnings decreases when earnings are transitory. The framework developed thus far suggests that both earnings levels and changes have explanatory power when they are included simultaneously in explaining stock returns. Earning changes are used as a proxy for unexpected earnings, following the assumption that earnings follow a random walk. Based on these arguments, in developing the theoretical framework on the transitoriness of earnings, it is proposed that annual earnings follow an Integrated Moving Average, IMA (1,1) process, which includes both levels and changes, i.e. permits for both transitory and permanent components. IMA was chosen because prior theoretical and empirical evidence shows that annual earnings follow a random walk (Cheng et al., 1996; Easton and Harris, 1991). This hypothesis predicts that the value relevance of earnings decreases when earnings are transitory and therefore, the value relevance of cash flows improves in all three countries when earnings are transitory. The issue of the time permanence of earnings has raised the stimulus in the present study in examining the role of operating cash flows when earnings are transitory. As Cheng, Liu and Schafer (1996) argue, earnings may contain transitory items with limited valuation implications. For example, transitory items that may be included are current and long- term accruals such as losses due to restructuring, current recognition (through asset sales) of increases in market value previously (or currently), one-time impact on income from changes in accounting standards etc. Moreover, because of compensation contracts and debt covenants are often based on reported accounting income, incentives exist for managers to introduce transitory elements in earnings. Dechow (1994) and Charitou et al (2001) also argue that because management has some discretion over the recognition of accruals, this can be used to manipulate earnings. Following Ali and Zarowin (1992) and Cheng, Liu and Schafer (1996), included in the theoretical framework, both levels and changes in order to characterise the unexpected components of earnings, whereas they also include levels and changes of cash flows from operations. This is done in order to test the hypothesis that when earnings are transitory the earnings response coefficients (ERCs) on both levels and changes will have reduced significance in explaining security returns. In this situation the importance of cash flows from operations will be greater. As in Freeman and Tse (1992) and Ali (1994) transitory elements are more likely to be present when unexpected earning values are large relative to price. Hence in the model [58], the coefficients c1t + c2t and c3t+ c4t represent the estimates of the earnings and cash flow response coefficients when earnings are mainly permanent. The coefficients c5t+ c6t and c7t+ c8t capture the additional information content of earnings and cash fl ows for firms with predominantly transitory earnings. It is expected c5t+ c6t to be negative and c7t+ c8t to be positive. In summary, following the aforementioned theoretical framework, I hypothesize that the incremental information content of cash flows from operations is expected to increase as the permanence of earnings decreases (see also Freeman and Tse, 1992; Ali, 1994; and Cheng, Liu and Schafer, 1996. Prior studies that examined earnings transitoriness include Cheng et al (1996) for the USA and Charitou et al (2000) for the UK. Prior studies have not examined the role of the cash flows when earnings are transitory in both Anglo-Saxon and code law countries. 3.0 Research Design 3.1 Dataset All industrial firms that belong in the Manufacturing Industry (SIC 100-4299, 4400-4799), Retail Industry (SIC 5000-5999) and Service Industry (SIC 7000-8999) from the USA, UK and France over the recent nine year period were selected. Industrial firms that had all the information available for the computation of operating cash flows, operating earnings and security returns were included in the sample, resulting in the following firm-year observations for the recent nine year period: USA =36695, UK =4234 and France = 1181. Consistent with prior empirical studies, observations that were regarded as outliers were excluded from the sample, i.e. observations with absolute change in earnings/market value, absolute change in cash flows/market value, earnings/market value and cash flow/market value greater than 150%. Also observations that were in excess of three absolute studentized residuals were considered outliers and were excluded from the sample. These restrictions resulted in approxim ate reduction of the sample size of about 2%, which is consistent with prior empirical studies. Therefore, the final sample size used for regression analysis purposes equals to 35872 firm-year observations for the USA sample, 4178 firm-year observations for the UK sample and 1165 firm-year observations for the French sample. 3.2 Measurement of financial and market variables In order to examine whether investors in UK, USA and France take into consideration in their investment decisions the levels and changes of earnings and cash flows, independent of each other, the following univariate regression model will be used: Univariate (Simple Regression) Model: RETit = b0 + biXi + eI (1) where: Xi: is replaced by: E: Operating Earnings ÃŽâ€E: Change in operating-earnings CFO: Operating cash flows ÃŽâ€CFO: Change in operating cash flows. RETit: stock return for firm i measured over a 12-month return interval ending three months after the fiscal-year-end. b0: the intercept term bi: slope coefficient ei: error term In order to test whether both the levels and changes of earnings and cash flows are valued differently in the capital markets, namely in USA, UK and France, the following multivariate regression model will be used: 3.3 Permanent vs transitory earnings models: In order to investigate the role of permanence of earnings, the basic regression model that includes the level and changes of earnings and cash flows will be extended to include additional dummy variables. The following model will be tested: RETit = c0 + c1Eit + c2Ã‚ Ã¢â‚¬Å¾Eit + c3CFOit + c4Ã‚ Ã¢â‚¬Å¾CFOit + c5Eit*D + c6Ã‚ Ã¢â‚¬Å¾Eit*D + c7CFOit*D + c8Ã‚ Ã¢â‚¬Å¾CFOit*D + eit where RETit= Security returns for the year, Eit = operating earnings CFOit = operating cash flows for firm i in period t, Ã‚ Ã¢â‚¬Å¾ denotes the change in a variable, eit is the error term for firm i in period t D is a dummy variable taking a value of one when earnings are transitory and zero otherwise. Consistent with Cheng et al. (1996), two alternative definitions are used to determine D. Under one approach, D equals 1 (0) when | Ã‚ Ã¢â‚¬Å¾Eit/ Pit-1 | is greater than (less than) its yearly cross-sectional median (Ali, 1994). Under the second approach, firms are ranked each year according to their Eit/ Pit-1 , placing firms with positive Eit/ Pit-1 into the first nine groups with equal number of firms per group and firms with negative earnings in the tenth group. Earnings are classified in the bottom two and top two groups as transitory (D=1) and earnings in the middle six groups as permanent (D=0) (Ali and Zarowin, 1992, Charitou et al, 2001). 4.0 EMPIRICAL RESULTS 4.1. Descriptive Statistics Table 1 presents basic descriptive statistics for all the earnings, cash flows and security returns variables examined in the study for all three countries (USA, UK and France) for the recent nine year period. Results indicate the following: a) the mean security return for UK and USA is the highest (0.092 and 0.08, respectively), whereas in France is somewhat lower, 0.055, b) the mean earnings level is higher for UK (0.057) and lowest for USA. For the French dataset the mean of earnings levels is 0.037; c) the mean of the cash flow levels is shown to be the highest for the French dataset (0.184) and lower for UK and USA (0.123 and 0.057, respectively); d) as expected the standard deviation of the levels and changes of cash flows is always higher than the level and changes of earnings in all three countries. These results are consistent with the results provided in prior empirical studies. Moreover, untabultated correlation analysis results indicate that there are no significant corre lations that may possibly affect the results. 4.2. Regression analysis results 4.2.1 Univariate and multivariate regression analysis results on the value relevance of earnings and cash flows for the USA, UK and France. Univariate results presented in table 2 indicate the following. First, as far as the value relevance of earnings is concerned, as expected, the results indicate that both the levels and changes in earnings are positive and statistically significant in all three countries. Interestingly, the size of the levels of earnings and the size of the changes in earnings is approximately equal in all three countries, in spite of the fact that the French financial reporting system is much more conservative. Specifically, the coefficients of the level of earnings are 0.759, 0.767 and 0.793 for the USA, the UK, and France, respectively. The coefficients of the changes in earnings are 0.701, 0.612 and 0.669, for the US, UK and France, respectively. As far as the R2 is concerned, results indicate that French earnings (levels and changes) are more value relevant than the earnings in the USA and the UK, even though the financial reporting system in France in more conservative. The R2 for the level of earnings is 11.20%, 8.80% and 6.70% for France, the UK and the USA. The same ranking applies to the changes in earnings, although the R2 is somewhat lower, indicating that the level of earnings is more value relevant than the changes in earnings. As far as the value relevance of cash flows is concerned, as expected, results indicate that cash flows are value relevant in all three countries. All the coefficients of the levels and changes in cash flows are positive and statistically significant. The size of the coefficients of cash flows as well as the magnitude of the R2 are somewhat higher in the Anglo-Saxon countries, suggesting that cash flows could be less value relevant in France. Moreover, as it was expected the size of the earnings coefficients and the magnitude of the R2 are relatively higher than the equivalent cash flow statistics. These results are consistent with our hypotheses, expectations and consistent with prior empirical evidence. This is due to the fact that earnings are considered more value relevant in the stock markets. 4.2.2 Multivariate regression analysis results for examining the valuation of earnings and cash flows when the earnings are transitory. Hypothesis 1 predicts that the value relevance of earnings decreases when earnings are transitory and thus, the value relevance of cash flows is expected to improve in all three countries when earnings are transitory. The issue of the earnings permanence has raised the stimulus in the present study in examining the role of operating cash flows when earnings are transitory. As Cheng, Liu and Schafer (1996) argue, earnings may contain transitory items with limited valuation implications. For example, transitory items that may be included are accruals such as losses due to restructuring, current recognition through sale of assets of previous periods, increases in market value, one-time impact on income from changes in accounting standards etc. Moreover, because of compensation contracts and debt covenants are usually based on profit, incentives exist for managers to introduce transitory elements in earnings and thus manipulate earnings. Results in Table 3 provide evidence to support hypothesis 1, that is, when earnings are transitory the role of earnings in stock markets decreases and the role of cash flows improves. Consistent with prior studies and with my theoretical framework, I included in my multivariate regression model in Table 3 both the level and changes of earnings and cash flows (Cheng, Liu and Schafer, 1996), in order to characterise the unexpected components of earnings and the unexpected components of cash flows from operations. This is done in order to test the hypothesis that when earnings are transitory the earnings response coefficients on both levels and changes will have reduced significance in explaining security returns. In this situation the importance of cash flows from operations will be greater. Therefore, in the model in Table 3, the coefficients c1t + c2t and c3t+ c4t represent the estimates of the earnings and cash flow response coefficients when earnings are mainly permanent. The coeff icients c5t+ c6t and c7t+ c8t capture the additional information content of earnings and cash flows for firms with predominantly transitory earnings. It is expected that c5t+ c6t to be negative and c7t + c8t to be positive. Specifically, results in Table 3 indicate the following. First, as expected, the sum of the coefficients of earnings (c3+c4) are positive and statistically significant in all three countries, the USA, the UK and France. These results indicate that in all three countries, the earnings are taken into consideration in the valuation of stock prices by security analysts and investors. Second, as expected, the sum of the coefficients of cash flows is positive and statistically significant in all three countries. Again, these results show that cash flows are important to security analysts and investors in the USA, the UK and France for stock valuation purposes. These results are consistent with the results provided thus far in all previous models. Third, the sum of the coefficients of earnings c5+c6 is negative and statistically significant in all three countries, the UK, the USA and France. These results are consistent with my expectations and with my hypothesis. These results mean that wh en earnings are transitory, i.e. when the variation of the earnings compare to stock prices is relatively high (in the present study above its median), then the stock market does not perceive this information as good news and the relative importance of earnings on stock prices decreases. This is measured by the sum of the coefficients of (c1+c2) + (c5+c6). To give an example to make things clearer, let us assume that earnings are stable, not transitory. In that case the effect of earnings on stock prices in the UK will be 5.65 (sum of coefficients of earnings c1+c2). In contrast, when earnings are transitory for a firm in the UK, the effect of earnings on stock prices will not be 5.65 as above, but it will be 5.65 minus 4.933 (b5+b6), which is 0.68 only. So for, stable or permanent earnings firms in the UK the effect of earnings on stock prices is 5.65 whereas for transitory earnings firms the effect of earnings on stock prices in the UK is only 0.68. As far as the USA and France is concerned the results are consistent with the UK results just discussed. Specifically, in the USA results indicate that when earnings are permanent the effect of earnings on stock prices is 5.88 (c1+c2), but when earnings are transitory (not permanent), then the effect of earnings on stock prices is only 1.08 (i.e. 5.88 minus 4.8 or c1+c2 minus c5+c6). Results in France also support the results of the UK and the USA. French results in Table 20 indicate that when earnings are permanent, the effect of earnings on stock prices is 5.66 (c1+c2), but when earnings are transitory (not permanent), then the effect of earnings on stock prices is only 1.15 (ie., 5.66 minus 4.51 or c1+c2 minus c5+c6). Fourth, as hypothesised, results in Table 3 support that the cash flow variables are taken into consideration by investors in investment decisions. Specifically, the sum of the coefficients of cash flows c3+c4 is positive and statistically significant in all three countries. For example, in the UK it is 0.15, in the USA it is 0.095 and in France is 0.18. These results are consistent with the results provided thus far in all previous models and hypotheses. Fifth, as hypothesised, results in Table 3 support that when earnings are transitory, investors and security analysts in the UK and the USA pay more attention to cash flows. This is evidenced by the sum of the coefficients of cash flows c7+c8. For example, in the UK when earnings are transitory, stock prices are affected more by 0.03 (c7+c8) from changes in cash flows. Similarly, in the USA, when earnings are transitory, stock prices are affected by 0.02 more from changes in cash flows. These results are very interesting because they show that in Anglo-Saxon countries such as the USA and the UK, investors do pay additional attention to cash flows because they do know that earnings are of lower value when they are transitory. On the other hand, consistent with prior evidence in previous models and tables of this study, French analysts and investors pay more attention to earnings because their code law system make financial reporting in France much more conservative, and thus the varia bility of earnings is not that high as the variability of earnings in the UK and the USA. Sixth, in all countries examined, results support that the model is statistically significant and the variation of stock returns as explained by the R2 is 15.6 in the UK, 12.8 in the USA and 17.2% in France. In summary, results presented in Table 3 support my hypothesis that when earnings are transitory (not permanent), investors pay less attention to earnings and more attention to cash flows. 5.0 Conclusions Consistent with our hypotheses and our expectations, these results indicate that earnings and cash flow information is country specific, that is investors and financial analysts pay different attention to earnings and cash flows depending on the country under investigation and on whether earnings are transitory or permanent. Specifically, results indicate that earnings and cash flows are perceived differently by investors, depending on the country to which they belong. When earnings are transitory, investors in Anglo-Saxon countries penalize more these firms because the effect of earnings on stock returns is much more negative (c5+c6= -4.933 and -4.8 for UK and USA, respectively, whereas it is only -4.51 for France). The results of this study have practical implications as well and should be of great importance to the major stakeholders such as investors, creditors, financial analysts, especially with the latest events that are taking place, and the major collapses of giant organizations worldwide such as Lehman Brothers, Bear Stearns, among others. Regulatory bodies, investors, financial analysts and the financial press, blamed among others, the possible manipulation of financial information supplied to the investors by these organizations. The question raised, is whether this type of information is taken into consideration by investors in their investment decisions.