North-west Frontier Province and National Peace Award

Being only sixteen years old did not matter squat to Malala Yousafazi. In a short fourteen years, she has won fame for fighting for peace, womens rights, and humanity. Last year, she won the National Peace award in Pakistan for all her efforts. In 2009—at only the age of 11—she fought Taliban insurgency that tried to take over her village of Swat. She wanted to set up her own political party which would campaign the right of young Pakistani girls to education. This girl—this heroine—was shot by a member of the Taliban, in the head and the neck, and is now in critical condition.The Taliban called her work â€Å"obscenity†. I call it heroism. They tried to silence this girl forever—they tried, and are still trying, to silence the ideas of freedom and rights and equality forever. But they will not win this war, not while human beings like Malala Yousafzai breathe and fight. An army chief called Malala â€Å"an icon of courage and hope†. S he’s more than that, much more. She’s the dawn of a new generation, the leader of a revolution in which humanity and justice prevails over the whole world.Malala, she stand as a role model for every girl in the world, to fight for what we believe in, no matter what the cost. she’ve brought a beautiful gift to the world, and to Pakistan, the gift of belief; belief that things can change. her message does not go unheard just as her own ideas have never gone unspoken. God-willing, we will see she gets back on her feet and go, to advocate for the rights shef deserve, with the power of the world behind her. We will see her reform her country and much more. we Thank her, for the inspiration she gave us all, by being a free-thinker, as much of a warrior as her namesake.The film I saw I recently saw an American movie which had impressed me much with its technical, screenplay and acting excellence. ?Witness? comes from Hollywood and it is an enjoyable crime thriller. ?Am ish? is an old forgotten culture in Pennsylvania. They live secluded with their unchanged 18th Centuary culture away from the modern society. They live a peasant life without any modern gadgets. As Amish boy unconsciously becomes an eyewitness to a murder. Killers belong to the police force and are very powerful.An honest detective takes the responsibility of saving the little boy from the killers and busting the crime. He becomes successful ultimately. The main attraction of the film is the excellent picturisation of ? Amish? culture. Every frame brings out the elegant beauty of a forgotten innocence with a contrast of modern ? organised crime?. A small 5-years old boy, the ? witness? is no natural with his stunning performance. Their faith, clannish loyalty and social discipline are filmed with a visual perfection. No overacting, melodramatic scenes and unrealistic car-chase and fights.The effect of the story strikes our thoughts so forcefully but nowhere the characters overplay t heir emotions. Harrison Ford, as a leading character expresses the pain of knowing the killers in all his tired and agonized looks. Here crime is not glorified. Hard truth of responsible people turning into betrayers is depicted quite efficiently in this movie. I think of it often and imagine the scene clearly. Even if they come to kill me, I will tell them what they are trying to do is wrong, that education is our basic right. † â€Å"I have a new dream . . .I must be a politician to save this country. There are so many crises in our country. I want to remove these crises. † -Malala Yousafzai â€Å"They cannot stop me; I will get my education if it is in home, school or any place. † –Malala Yousafzai Malala Yousafzai is a 16 year old who has been advocating for women’s education in Pakistan since she was 11 when she wrote a pseudonymous blog for the BBC about her experiences living under Taliban rule. The Taliban controls the Swat Valley in Pakista n, and had attempted numerous times to prohibit women and girls from attending school.They have removed signs on school buildings and have even destroyed schools to prevent women from being educated. In her BBC blog, Yousafzai describes having to go to school while the streets echo with gunshots and being forced to stay at home because women were not allowed to attend schools, but studying anyway, even though she was unsure if she would be allowed to take her exams. In 2012 Yousafzai was riding on a bus home from school when she was shot in the neck and head by the Taliban in an assassination attempt.She survived this attack, and has continued to fight for women’s education in Pakistan. In an interview with Jon Stewart on â€Å"The Daily Show† from Oct. 9, 2013, Yousafzai said, â€Å"I used to think that the Talib would come, and he would just kill me. But then I said, ‘If he comes, what would you do Malala? ’ then I would reply to myself, ‘Malala, just take a shoe and hit him. ’ But then I said, ‘If you hit a Talib with your shoe, then there would be no difference between you and the Talib.’†Ã¢â‚¬Å"You must not treat others with cruelty and that much harshly, you must fight others, but through peace and through dialogue and through education. Then I said I will tell him how important education is and that ‘I even want education for your children as well. ’ And I will tell him, ‘That’s what I want to tell you, now do what you want,’† Yousafzai said . Despite being personally hunted down by the Taliban for her activism, Yousafzai continues to be wise well beyond her years. In 2011, she was nominated for the International Children’s Peace Prize and awarded the National Youth Peace Prize.Yousafzai also founded the Malala Education Foundation which assists underprivileged girls attend school. Next time you might consider skipping class because the weather is i nconvenient or you did not finish your homework, just remember all that Yousafzai has done and been through for her education and the education of others. She took a bullet at point blank range because she wanted to learn and wanted others to have the right to learn as well. I think it will be okay if you have wet shoes during class once in a while.

Final Draft

Football is a kind of sport which involves kicking a ball with our foot to score a goal. In football, the common skills include passing, tackling, catching and kicking the ball. There are some reasons why soccer has been the most popular sport in the world, including Indonesia. The first reason why soccer has been the most popular sport in Indonesia is because it is played on all levels. Soccer can be played by children, teenagers or even middle-aged man. Experts found out that professional Club academies recruit thousands of young footballers – some of hem only five years-old, meaning children can also play football.Dry. Jean- Pierre Marksmen, a director of medical team in soccer, estimate that the maximum age for soccer players is about 40 years old. He added that this age is for top-class players who play in a well-known league, so for older people who wants to play soccer just for fun, they still can play but they shouldn't force their body too much. In Addition, playing s occer could also bring health benefits to our body which includes: lowers body fat, builds strength, flexibility, and endurance.One of Soccer Expert, Timmy Sutherland, explained that â€Å"An increase in aerobic capacity allows soccer players to run farther for a longer period Of time. † This means as soccer increases our cardiac capacity, it also improve our endurance or body stamina. He also added that â€Å"As people get older, bone density becomes more of an issue. The repeated weight-bearing loads on the body during a soccer match are an excellent way to increase the strength of our skeletal frame†. In other words, playing soccer will increases muscle and bone strength. Soccer is a great sport for weight ass because it works your muscles in different ways.Playing soccer burns more calories than typical workouts because you ire forced to switch between using your aerobic and anaerobic energy pathways. Playing soccer burns for about 260 calories in half an hour. The refore, if you play soccer for an hour three times a week, you can burn 1,500 calories each week, and lose 2 pounds each month from playing soccer. Other than that, many people choose soccer as the best sport to play because it is challenging yet easy to play. As we know, it is hard to score a goal in soccer because we need to pass wrought 10 enemy players then shoot towards goalie to score a goal.One key thing in playing soccer is teamwork, in order to score goal easily, we must show a good teamwork and team cooperation, because compared with the one who play individually, we can save our energy and work as a team. In conclusion, soccer is the most popular sport in Indonesia because in soccer, running and kicking the ball, or even scoring a goal can burn a lot Of fat in our body and make our body healthy. For those who like soccer, kicking a soccer ball around is something that can be so addictive and they can spend hours ongoing it without getting bored. Final Draft Ethos pertains to ethical appeals; pathos relates to emotions and values; and lastly, logos communicates a logical appeal. Through the use of logos, ethos, and pathos, this paper will discuss how I became a member of my discourse community; which is my youth group. In addition, it will give you an insight into a large segment of my life. The first night was ever invited to join my youth group was during the fall of 2008. Sitting in youth group on Wednesday nights has taught me about God on a much deeper level and has helped me have a more personal connection with my Lord and Savior.Because have been in youth for six years I have developed logos by having a well-rounded knowledge of the Bible, and because of my level of experience. My youth group knows that they can come to me if they are ever stressed or concerned about anything, or even if they have any questions. Additionally, Robert and Leslie know they can come to me if they need help with the youth or setting up a game. Every no w and then, Leslie and Robert will plan a game night instead of teaching. It is during these nights that they usually pick me as a team captain because of my knowledge of the Bible, due to all my years in youth group.Now some naysayer might say that have not yet become a part of this discourse community, but this summer my youth group leaders believed otherwise. Throughout the years, have developed a strong bond with my youth group leaders. Because am one of the original members of our youth group, I have been there the longest along with my best friend, Andrea Camp-Valve. Traditionally, after a person graduates from high school, our youth group traders throw a party in celebration of their entrance into the adult congregation that meets at the same time.This year, for the first time since youth began, my youth group leaders offered my friend Andrea and I an assistant leadership position in youth, further cementing my ethos. Although assistant leadership positions have been offered to others before, this marks the first time it has been offered to someone our age. Leslie and Robert felt we truly know God's Word and could teach it if one day something came up and they had to be absent. With that being said, one of our responsibilities as assistant leaders is to share a message once every two months.Some of our other responsibilities include decorating the youth room; planning game nights once a month; and assisting in planning youth events such as lock-ins, parties, and any trips we may take. In previous years, I have attended countless mission trips with my youth group to Mexico. During these trips, I have had the privilege to pray and intercede for many families and children. On one of our youth group mission trips to Mexico, I went to a shelter for or orphan children with mental disabilities. This home is not funded by the government at all and has been able to survive throughout the years from donations and several volunteers.It was at this shelter where th e youth and I were able to help the owners clean up the grounds, paint fences and gates, and feed the children. Once I finished helping out with the outside work, I was able to sit down and color and read with these beautiful children. Although they were poor and had very little, was highly impacted by how happy the children were and how peaceful the atmosphere seemed. This experience helped me develop pathos by having some one-on-one time with these children and by helping the owners refurbish part Of the grounds.Over the past few years, I have been a part of numerous fundraisers that my youth group has held in order to raise money for the lower income families in my church to go on mission trips. At the same time, most of the money we have raised during these fundraisers has gone into donations we give to people or churches when we go on mission trips. For the past two years, my youth group has been able to raise enough money to host a summer camp or the children in Mexico in two different churches. This is a very large feat for our youth to have been able to achieve.It takes countless hours and a willing staff to prepare all the decorations, games, toys, and prizes we hand out during Vacation Bible School. Even after everything has been made and prepped, we still have to load it all in several vans and drive it all the way down to Mexico. Last year, I had the privilege to go and share the Gospel with over 200 children and teenagers. The amount of prizes for the kids that were donated to our church was overwhelming. Even though we did BBS for two very large churches, we had enough prizes for all the kids to receive at least three toys per person.These kids are extremely poor, therefore for them to have received these toys was an incredible blessing to them. During BBS, we were also able to feed all the kids and make sure they went home full; sadly, for most of these kids, that meal we gave them was the only thing they would eat that day. Cannot stress enough just how poor these children are, and yet, they are tremendously happy. It is quite unbelievable to see heir need and yet none of them complain about anything, while here in America, we have everything and still complain if it is too hot in a building with air conditioning.This helped me develop the pathos aspect by highlighting these mission trips and visiting said orphanages and underprivileged individuals. Being a member of my youth group has helped me mature and grow in so many ways. It has opened my eyes to see the world in a completely different perspective. My youth group has always been there with me through thick and thin; not one time have I ever felt rejected by them. Lastly, it has taught me about God and how much He wants to have a personal relationship with me.Because of my youth group, have the best group of friends I could imagine; all of my best friends are members as well. I cannot wait to start this new chapter in my life as assistant leaders for my youth group a nd looking back on all the years I have been a part of youth, am truly thankful that God has put me in this discourse community. Because of ethos, pathos, and logos, have earned valuable skills that I know I will need for future endeavors. I can honestly say I am a proud member of this discourse community.

Huggies Mamy Poko Company Backgorund Essay

Kimberly Clark is founded in 1872 at Neenah, Wisconsin and is headquartered in Dallas, Texas. It is passionate about providing people with essentials for a better life by adding convenience to daily routines with some of the world’s most recognized products. Kimberly Clark has approximately 58,000 employees worldwide and operations in 36 countries. Its sales have increased to $21.1 billion in 2012. Kimberly Clark has many global brands and one of them is Huggies. Huggies diapers were first introduced by Kimberly Clark in 1978, and they’ve been improved nearly every year since. Refastenable diapers, breathable diapers and stretchy diapers are all Huggies firsts. At the controls of the Huggies innovation engine are everyday consumers. The art of understanding and anticipating consumer needs – sometimes before consumers do themselves – has led not only to product advances but the creation of whole new categories, businesses that didn’t exist before. In 1985, Huggies took leadership of the category for the first time, and has been the number one selling diaper in America since 1993. Today, Huggies brand introduces a demonstrably better product every year, and the imperative to innovate extends far beyond the Huggies diaper franchise. It’s no accident that Kimberly Clark offers consumers the number one or number two brand in 80 countries. Unicharm Corporation, MamyPoko Unicharm Corporation is a Japan-based company mainly engaged in the manufactured and sale of baby care products, feminine care products and pet care products. Unicharm is established on February 10, 1961. The company operates in three business segments. The personal care segment provides baby care related products, such paper diapers; feminine care related products, such as sanitary items, as well as healthcare related products, including incontinence articles for adults and powder puffs. The pet care segment provides pet food products and pet toiletry products. The others segment is engaged in the gravure printing, processing and sales business, as well as financial business. As of March 31, 2012, the company owned 40 consolidated subsidiaries and two associated companies. MamyPoko is a brand of the company Unicharm that focuses on pant-style diapers for babies. MamyPoko started manufacturing baby diapers since 1981. MamyPoko pants at present are sold in 14 Asian countries. MamyPoko pants come with a core that has maximum absorbent and moisture-locking capacity. MamyPoko diapers come in the following 3 types, MamyPoko tape diapers, extra soft fit and easy fit pants. Apart from manufacturing diapers, the brand also produces baby wipes, both in fragrant and non-fragrant varieties.

The Critical Appraisal of the Research Evidence Associated With an Essay

The Critical Appraisal of the Research Evidence Associated With an Area of My Professional - Essay Example Critical reviews of nursing research thus improve the experiences and knowledge of nurses in various practice areas. Hong Kong’s healthcare system has an increasing demand for evidence-based approaches. In particular, nurses face more serious evidence-based practice challenges given that the nature of their work requires that they rely on the available scientific evidence for decision making (Spring & Hitchcock, 2010). Observably, absence or lack of nurse representation in research would limit the growth and development of the profession (Duffy, Fisher & Munroe, 2008). Evidence-based practice in Hong Kong has numerous issues and implications in its establishment that need to be through the critical analysis of the available and relevant researchers. Despite the fact that evidence-based practice is a widely discussed concept in the literature, it is uncommon and not well adopted in nursing practice in Hong Kong and other countries. This paper critically appraises two journal articles on practice area relevant to Hong Kong. This critical appraisal is through the three essential elements of evidence-based practice, namely systematic reviews, clinical guidelines, and protocols. In essence, the appraisal explores some of the current issues associated with evidence-based practice in Hong Kong. It then outlines specific suggestions to researchers, nursing practitioners, managers, and academics so that the current nursing situation in Hong Kong is advanced. The appraisal is by a PICOT format question with the relevant population, intervention, comparison, outcome, and time. A critical appraisal of research evidence is a step in evidence-based practice in nursing. Through critical appraisal, the validity and usefulness of research evidence are established. This critical appraisal wasconducted in three main steps, namely validity, generalizability and

Film Analysis of Jean-Pierre Jeunet Essay Example | Topics and Well Written Essays - 2500 words

Film Analysis of Jean-Pierre Jeunet - Essay Example The comparative analysis of the two movies helps us to understand the technicalities used by Jean-Pierre Jeunet in establishing the themes for his movies. Thesis Statement: Jean –Pierre Jeunet uses the help of detailed storytelling and uses cinematic approaches for the establishment of the themes in his movies. The cinematic approach used by him differed in various outlooks according to the subject chosen by him. A Very Long Engagement: A Very Long Engagement by Jean-Pierre Jeunet is another master class created by him. The movie is based on French background and a superb piece of storytelling approach was followed by the director to set the story on pace. The director has taken the help of flash back to depict a part of his story and his class of mixing the two eras falls under a special genre (Hurley). Jeunet has been successful in depicting the memories of the French war by using stupendous location and the use of long shots through the muddy fields. The long shots is panne d at a fast pace with the help of Long cranes which signified the pace of the battle. The choice of exotic location throughout France helps to grasp the interest of the viewers. Locations like Paris, Brittany and Poitiers were used in the movie (A Very Long Engagement  (2004)). The battle scenes used in the movie are supposed to be inspired from the movie Saving Private Ryan. Though the movie is war based, yet Jeunet has been successful in depicting a well composed and a balanced portion of the story as a love epic. The screenplay used was optimally balanced and Jeunet used his master class to combine the two and deliver a master class. In the war scenes the use of sound has been critically and carefully used to give the viewers a raw feeling of the ongoing of a war. The sounds used in the sequence are of high quality. The director places the story in personal vision rather than trying to depict it as a historical epic. The use of color images from the start of the story helps the viewers to land into realism or better termed as cinematic impressionism. At the end viewers are left with multi hued memories. The camera angles used by Jeunet were also very much critical. Wide angled close ups of Tautou is used. The focal length and the height of the camera were carefully studied to get the best view of the shots of Tautou. The director uses a mix of cold colors in depicting the wartime trenches and the warm color to elaborate the peace time. The main tinge of color used in the film was that of the color brown while a patch of greenish brown was used in the war field. The color used is monochromatic and spots of other colors are used. In the scenes of the trench, the face portraying the soldiers is aimed to have a different image than the rest of the faces used in the movie. The aim was to provide a markup distinguish in the faces (Cinematic impressionism).The use of voice over has been carefully handled in the film and its dynamism in the tone of voice was crit ically appreciated. The audio mix used in the film is also stunning. The quality of sound is superb as the rain drops falling in the coats of the soldiers seemed almost real. The use of supplemental material in the film has also been solidly handled (Schager & Gonzalez). The tones used overall in the film are unrealistic and often ranges from golden to sepia to gray according to the varied situations and the plots used in the movi

Global Marketing Assignment 2 Case Study Example | Topics and Well Written Essays - 2000 words

Global Marketing Assignment 2 - Case Study Example Networking helps the new brands to improve their sales and markets. The networks expand the market segments for the new brand to increase the customers and reach the targeted customers (Philip & Keller, 2005). Thus, it is significant to have the connections to increase the market awareness of the brand. Lastly, there are enough infrastructures in place to make sure that there is efficient movement of the products. Honey needs good storage facilities to be in place. There is also need for transportation requirements to reach the customers. The Korea market has enough transport modes, roads, and railways to enhance the movement of the foods. Thus, the Korean foods have the advantage of the efficient infrastructure to improve its connections. There exist factors in the same market that make it unfavorable for the Korean honey. First, is the less experience on circulation of the products in Korea. The Korean culture and the environment of business are somehow different. The Korean food has only done some few exporting to Japan; thus, the Korean market does not do much international marketing. The globalization involves advertising the products overseas past Japan. As a result, it may provide great business to the business through broadening its customer base and improving the reputation of the Korean food brand. Customers prefer a brand that is selling in various markets to be of better services and higher quality than the other brands, in this case, the food markets. It may also provide opportunities for future opportunities in the international Korean market (Adcock & Al Halborg, 2001). Secondly, the Korean food act as an intermediary and not the producer. Thus, it has less control over suppliers in crucial factors such as quantity, quality and packaging technology. Managing of suppliers makes them improve their quality of their products, and it is the important factor in selecting a supplier (Kerin, 2012). Having control

Total Rewards Programs Research Paper Example | Topics and Well Written Essays - 2000 words

Total Rewards Programs - Research Paper Example According to the paper in spite of the age old concept, worth noting is that total rewards is especially relevant in the present-day work environment, whereby globalization has made it possible for employees to work in diverse environments. The following total rewards system proposal seeks to focus on the latest available information with regard to creating, organizing as well as effectively managing a total rewards program. The program is targeted for the ABC Company, a service-based organization that employs more than 20,000 located in 17 different countries. There are also over 2,000 management level employees who speak in diverse languages. In consideration of the multiple regulatory environments, a total rewards systems is proposed. Firstly, a brief overview of the company requirements for a total rewards system is provided. A total rewards strategy has then been formulated and the various advantages of the proposed strategy explained. Further, the key communication components o f the system are established. Lastly, but certainly not least, a strategy has been examined for devising a competitive pay structure. The total reward program is holistic and does not rely on one or two reward systems operating in isolation. Further, there is good account of every manner in which people can obtain satisfaction and are rewarded through their work. The objective of total rewards is to maximize the combined impact of a wide range of reward initiatives on motivation, organizational commitment and job engagement. This concept aims to blend the financial as well as non-financial reward elements into a cohesive whole. As put by O’Neal   Ã¢â‚¬Å"total reward embraces everything that employees value in the employment relationship.† WorldatWork also offer an equally wide definition of total reward, stating that â€Å"all of employer’s available tools that may be used to attract, retain, motivate and satisfy employees.† Overview of company requireme nts for a total rewards system From this paper it is clear that there is an increasing need for corporations to come up with reward systems that motivate employees to work harder and more effectively. These systems usually teach associates the importance of being productive and efficient, as well as their inherent value in companies. However, considering the pressures associated with incentives or performance, or even ineffective implementation procedures, in some situations, these systems can encourage unethical or even unwanted behaviors . Therefore, to attract and retain the best workers, corporations need to have an appropriate rewards system that will always reward and encourage workers to always remain focused on producing the best quality services in an efficient manner, thereby meeting the needs of customers. This corporation needs a reward system that will be linked with goal-setting, competency measures and employee development. A reward system will help the corporation in moving toward a better alignment between company strategies and values and performance management. This will help in decentralizing the decision-making down company hierarchy to help in empowering every manager located in different parts of the world.  

Write about yourself Personal Statement Example | Topics and Well Written Essays - 250 words

Write about yourself - Personal Statement Example With my current stand, I wish to contribute more to the political field by becoming a part of an embassy where I can practically impart my skills. Apart from my professional interests, I lead a balanced life by giving quality time to my part time activities and to my family and friends. I enjoy a very healthy relationship with my parents and younger brother and I manage to spend my vacations with them. A recent memorable holiday was only a few months back when we travelled to Orlando, Florida together and visited the Walt Disney World. It was an unforgettable experience as apart from the entertainment, we were able to spend unforgettable moments together. I lead an active lifestyle and keep myself engaged in various part time physical activities as well. I like swimming and regularly enjoy a swim with my friends. Apart from this, football is also my favorite sport and I like playing as well as watching the game. I am also fond of exploring new places and take pleasure in travelling to different places locally and abroad. Thus, I am an all-rounder and try to give my best to my professional field as well as to my family and

How Aircraft and Aircraft Carriers helped the U.S in WWII Research Paper

How Aircraft and Aircraft Carriers helped the U.S in WWII - Research Paper Example Air power facilitated the surveillance of the U.S land. The use of aircraft in the World War II was part of a national grand strategy. Higham observes that the use of aircraft in the war during the 20th century consisted of strategic planning by the government and tactical operations, which follows the, principles of war and commerce (2002, 1). In this paper, we focus the discussion on how aircraft and the aircraft carriers were of help to the U.S army during the World War II. Air power consists of the air forces, airlines, aircraft and the ancillary industry. For the operation of this industry, it requires management that entails command control communications and intelligence. All this things were a vital part for any U.S air force soldier to be familiar with before taking command of any U.S air force airline. During World War II, Higham points out that the air power was still a not an area familiar to the American army. However, over the years the airpower became a force to reckon with, the air force was vital to the ground power in the World War II. ... At the pacific, see the land, based air forces and the carrier task forces were in use. The U.S utilized the air force to patrol the sea-lanes in the north Atlantic; photoreconnaissance was also a part of the role done by the air force in the wars. The British and Americans used the air power for guerrilla warfare. In his book, the rise of American Air power, Sherry examines the American bombing strategy of specific interest is the Hiroshima and Nagasaki bombing. The author approaches this from the cultural point of history. Sherry points out that the U.S utilized the dropping of the atom bombs as a defence and due to its terror potential. Culturally speaking the use of air power was not because of the technological advancement of the weapons used in war but it was a continuation of the fantasy of scientific warfare and the evolving of political social and military views (1987,239). With the technological advancement in the air power, the dropping of the atom bombs was an easy way fo r the U.S to block the enemy’s ability to wage war. The Japanese according to sherry’s observation gave in to an unconditional surrender. Sherry does point out that in the use of aircraft; the aerial bombing was a chaotic and haphazard affair that yielded unintended consequences that included massive civilian casualties. This to sherry was a failure because it did not in any way address the necessity to defeat the main body of the enemy military forces (1987, 145). Sherry observed that the use of aircraft as an offensive strategy in the warfare did achieve its target because it did fuel for revenge between combatants. This was because of the inhumane pain inflicted upon the civilian population. The whole idea of developing technology related to aircraft warfare

Strategic Analysis Essay Example | Topics and Well Written Essays - 1750 words

Strategic Analysis - Essay Example In the modern scenario, to maintain sustainability in the global market, every organisation tends to form a basic company objective, vision as well as mission. Organisational culture has certainly created the need of following certain principles for attaining predetermined targets. These principles often help the employees to reap varied significant benefits like improved level of operational performance of the personnel. By taking into concern the present business market conditions, it can be affirmed that two vital factors including organisational culture and leadership are deemed to be quite important for any company that can assist in fulfilling desired objectives. A correct form of organisational culture and varied leadership practices may contribute in securing the future of the companies by a considerable extent (Wilson, 2005). Harley-Davidson (H-D) is a renowned American based business corporation, which deals with manufacturing motorcycles. It is regarded as one the oldest brands as a motorcycle manufacturer. It can be apparently observed that the company has strived to maintain organisational culture for fulfilling its desired targets. One of the main objectives of H-D is identified to offer quality products at a promised value. From the preceding few years, the company focused on changing its product design to gain more customer attention. In its long journey, H-D faced numerous difficulties in terms of finance. This can be justified with reference to the fact that the company experienced tremendous fall in market share due to the reason of having certain problems with one of its Japanese manufacturer. By taking into concern the trend of organizational culture prevailing within H-D, it can be ascertained that the company has produced new models with the increased level of improved operational performan ce of its employees. In the year 2003, H-D faced the challenge of severe decline in product demand, due to which, its share price

Biochemistry Final Project part 1 Essay Example | Topics and Well Written Essays - 500 words

Biochemistry Final Project part 1 - Essay Example ophrenia has been linked to the affected parents passing the genes to the children (genetic factors), unusual metabolic conditions and abnormal brain conditions (Cohen, Kleinman, & Saraceno, 2002). It is evident from research that kids with both parents free from schizophrenia have 1% risk of developing the illness. If either of the parents has schizophrenia, then the child`s risk of developing the disease rises to approximately 13%. If all parents have the illness, then there is a 46% chance of the child having the illness later in life. There is an 8% risk in cases where, all other relatives are free from the disease, but a brother or a sister to an individual has schizophrenia. An identical twin of an individual with schizophrenia is 48% at risk as compared to only 17% risk in case of dizygotic twins (Pfaff, 2013). First-degree relatives of an individual with schizophrenia are at a greater risk than second-degree relatives. In addition to genetic factors, other environmental factors such as general stress play a role in developing schizophrenia. Brain examination through neuroimaging has shown brain abnormalities in schizophrenics (Harman, 2003). The ventricles are enlarged, and there are fluid-filled cavities in the deeper parts of the brain. These abnormalities are the cause of the accompanying symptoms. Besides, an imbalance in neurotransmitters, dopamine, serotonin, and glutamate may cause schizophrenia. Homocysteine accumulation due to deficiency of methionine synthase and cystathionine ÃŽ ²-synthase causes schizophrenia. Other conditions such as hypocalcemia and hyperparathyroidism are linked to schizophrenia. Structural changes, copy number variations (CNV) in individual’s genome causes schizophrenia. CNV happens if the genetic material is lost, duplicated wrongly or inserted in a wrong manner. For instance deletion at 22q11 accounts for psychosis in 30% of cases. When 22q11 deletion occurs, essential genes that play a crucial role in schizophrenia such

Employee Rights Review Essay Example for Free

Employee Rights Review Essay â€Å"Acts of Equal Employment Opportunity and Employee Rights† laws make it illegal for employers to discriminate against an employee or potential employee in certain workplaces. The Family Medical Leave Act of 1993 was created to grant family temporary medical leave. The Age Discrimination in Employment Act of 1967 was created to prevent employees from being discriminated against because of age. The Drug- Free Workplace Act of 1988 requires some federal contractors and federal grantees to agree that they provide drug-free workplaces as a precondition of receiving a contract or grant from a federal agency. The requirements for organizations are more extensive because organizations have to take comprehensive, programmatic steps to achieve a workplace free of drugs. In the case, Coleman v. State of Maryland Court of Appeals, Coleman, an employee for the Maryland Court of Appeals, requested time-off for the purpose of tending to serious personal health issues. The request was denied and Coleman was informed he must resign from his position or risk termination. Coleman sued his employer, claiming that by denying him self-care leave the state court was in violation of the Family and Medical Leave Act of 1993. His employer, the state, argued that the case should be dismissed based on the state’s ‘sovereign immunity’. Sovereign immunity is a legal provision that says a government agency cannot be sued unless they agree to be sued. After dismissal by the Federal District Court and the Fourth Circuit Court, the case was heard by the United States Supreme Court. On March 20, 2012 the Supreme Court ruled that a provision of the Family and Medical Leave Act giving workers time off to care for health related issues such as serious illness, pregnancy, or childbirth, is not enforceable in cases involving state employees (Migdal, 2012). The Court justified the ruling by stating that the lawsuits by state employees permitted under the FMLA would violate the constitutional rule that the states, as sovereigns, are immune from suits for damages. Basically, the Supreme Court ruled that state workers cannot sue the states under the Family and Medical Leave Act, essentially stripping public employees of the job protection otherwise provided by the act. The Family and Medical Leave Act of 1993 protects employees of organizations with more than 50 employees in the case of childbirth, adoption, their own medical care or the care of a family member. The law has several stipulations such requiring 1250 working hours in the prior 12 months, therefore, accurate recordkeeping and a process in place to determine FMLA eligibility and compliance is crucial. An example of a company HR policy regarding the Family and Medical leave Act of 1993 may read: â€Å"Employees employed for 12 months or more and who have worked at least 1250 hours in the previous 12 months, may take an unpaid Family and Illness Leave for up to 12-weeks per year. Employees are required to use all available paid time accrued for the leave period prior to unpaid leave.† â€Å"The amount of Family and Illness leave will be based on the amount taken in the 12 months preceding the request for leave, and in cases of serious health condition, require adequate medical certification.† â€Å"Family and Illness Leave may be taken intermittently, or for less than a full day. If the employee remains out on leave for more than 2 weeks, additional medical documentation may be required as allowed by law.† â€Å"An employee returning to work from Family and Illness Leave shall return to the position held at the beginning of the leave, or to an equivalent position with equivalent pay and benefits.† â€Å"Employees on a Family and Illness Leave will continue to have the Employer’s portion of the cost for health insurance paid by the Employer during the leave period. It is the responsibility of the employee to make on-time payments for their portion of those benefits while on leave.† Individuals 40 years of age and older are protected with employment by The Age Discrimination Employment Act. Applicants and employees alike have protection under the ADEA. â€Å"The law protects discriminating against an individual with respect to any term of employment, as it relates to age, compensation, benefits, job assignments, hiring, firing, layoff, job assignments, and training† (U.S. Equal Employment Opportunity Commission, 2012). Employers who employ 20 or more employees must comply with the Act. A 70-year-old pharmacist employed by Kmart in Honolulu recently challenged The Age Discrimination Employment Act. The lawsuit charged by the EEOC recognized that Kmart unlawfully discriminated against the pharmacist, and a settlement was reached for $120,000. A Kmart store manager openly â€Å"stated that the pharmacist was too old, should retire and was greedy, for continuing to work at the age of 70† (Inside Counsel, 2012). The age discrimination act protects folks for age harassment. In this case the pharmacist was continually distraught with regard to remarks about her age and the hostile work environment that could have resulted. Employers tend to stereotype older workers as employees’ stuck in their ways, and who cannot adapt to new changes. Additionally, employers believe that training older workers is a cost and not a benefit. The Age Discrimination Act prohibits these scenarios from occurring with people over the age of 40. Regarding the Age Discrimination in Employment Act of 1967, certain occupations have an exception to the law if the organization can prove the necessity to enforce an earlier retirement or decrease of job responsibilities. An example of a company HR policy showing compliance with the Age Discrimination in Employment Act of 1967 may read something like this: â€Å"The Company complies with the Age Discrimination in Employment Act of 1967, and prohibits age discrimination in employment practices of individuals 18 years or older. This policy applies to but is not limited to issues involving hiring, discharge, compensation, terms, conditions, advancement, recruitment, promotion, demotion, transfer, layoff, training, or privileges of employment.† The Drug-Free Workplace Act â€Å"requires institutions that receive grants and certain contracts from any federal agency to certify that it will provide a drug-free work place† (Office Of General Counsel, 2012). The law was enacted in 1988 and it began with federal contracts of $25,000 or more but was later changed to $100,000 or more where it stands today. The court case that has caused the most controversy is Gary Ross v Ragingwire Telecommunications Inc. After California legalized medical marijuana Ross obtained a prescription for the drug and used it as directed. He was later fired by Ragingwire Telecommunications for failing a drug test as a result of the use of medical marijuana. â€Å"The court ruled that drug testing in the state was legal, that firing an employee for use of medical marijuana was not tantamount to discrimination and that employers are not obligated to accommodate the use of medical marijuana—even outside the workplace† (Schwartz, 2010). This ruling is important because while some states have legalized medical marijuana and protect individuals from criminal prosecution, it remains clear that a drug-free workplace is critical to the safety of the entire workforce. To avoid conflict an organization must establish the guidelines for drug testing and communicate the expectation clearly to employees. The human resources team may establish the process for drug testing and implement a plan to assist employees that test positive on drug screens, such as offering the employee rehabilitation (DeCenzo Robbins, 2007). An example of a company HR policy showing compliance with the Drug-Free Workplace Act may read something like this: â€Å"The possession, use, or sale of illegal drugs while on Company property is strictly prohibited. The misuse of any illegal drugs and/or alcohol while on Company time or during breaks or meals, is strictly prohibited. Any employee under the influence of alcohol or drugs that may impair judgment, performance, or the safety of the employee or others while on Company property, Company business, or during work hours, is subject to discipline up to and including termination. The Company conducts post-accident drug and alcohol testing of employees when an accident occurs during company time as allowed by law. The Company reserves the right to conduct random drug and/or alcohol testing at their discretion for performance or behavior issues. A positive result from any testing conducted may result in immediate termination, or unpaid leave to enter an approved rehabilitation program at the Company’s discretion. These conditions are by no means established as a right of the employee, and may be rescinded at any time without prior notice by the Company.† References Migdal, A. (2012). Blog of Rights. Retrieved from http://www.aclu.org/blog/womens-rights- reproductive-freedom/not-so-secret-war-moms-how-supreme-court-took-protections Swanton, Mary, Inside Counsel, EEOC Wins Settlements in Age Discrimination Cases Involving Senior Citizens, retrieved on December 1, 2012 from website, http://www.insidecounsel.com/2010/03/25/eeoc-wins-settlements-in-two-age-discrimination-cases-involving-senior-citizens U.S. Equal Employment Commission, retrieved on December 1, 2012, from website, http://www.eeoc.gov/eeoc/publications/age.cfm Schwartz, S. K. (2010). The Drug-Free Workplace v Medical Marijuana. Retrieved from http://www.cnbc.com/id/36179669/The_Drug_Free_Workplace_vs_Medical_Marijuana Office of General Counsel. (2012). Retrieved from http://counsel.cua.edu/copyright/index.cfm Sue Shellerbarger, â€Å"Work and Family,† The Wall Street Journal, August 22, 2001. Retrieved 11/29/2012. http://www.benefitslink/buying-time-off/policy/hr/whitman/press.org http://www2.cortland.edu/offices/hr/affirmative-action/policy-on-the-age-discriminatio n.htm http://www.eeoc.gov/laws/statutes/index.cfm http://en.wikipedia.org/wiki/Employment_(Equal_Opportunities)_Law,_1988

Development of Credit Facilities in Sierra Leone

Development of Credit Facilities in Sierra Leone Chapter 1 This study is on the creation of credit facilities to Small and Medium Size Enterprises in Sierra Leone with special focus on the construction industries. 1.1 Background to the Economy of Sierra Leone Sierra Leone is a relatively small country, on the West Coast of Africa with an area of approximately 28,000square miles. The estimated population is 5.5 million inhabitants, 30% of whom resides in the western area of the country according to recent census in 2006. The state of the country’s economy, immediately after independence from the British Colony in 1961 up to the 1970’s, was quite satisfactory in terms of performance. The exchange rate between the Leone and other foreign currencies was relatively good. More so, the British Pound Sterling was exchanged at One pound ( £1) to One Leone (Le1). The inflation rate was extremely low. The country’s earnings from exports were very much attractive, with Diamond export accounting for well over 50% of the country’s foreign exchange earnings. This was closely followed by cash crop exports such as Cocoa, coffee, oil palm, piassava and chillies. The country’s external debt position at this time was not high, Between 1972 to 1975, the economy started experiencing down turn that was mainly due to external factors, such as the famous oil price shock in 1973. Naturally, the 1980 Organisation of Africa Unity (OAU) summit that was hosted by the government of Sierra Leone fuelled the debt crisis in Sierra Leone. Because of the foreign exchange scarcity in the country, the credit agreement between domestic importers and their business partners aboard collapsed. In 1988, the country was forced to devalue her currency. Between 1992 and 1994, Sierra Leone successfully implemented an adjustment program supported by the International Monetary Fund (IMF) under the Right Accumulation Program (RAP). The World Bank also supported the program through the Reconstruction of Import Credit (RIC) in 1992 and the Structural Adjustment Credit (SAC) in 1993. Following the successful implementation of the RAP, the IMF approved a three year arrangement support under Enhanced Structural Adjustment Facility (ESAF). The implementation of the first annual program was disrupted by the escalation of the rebel activities in 1995. With the return of democracy in 1996, the IMF supported the economic recovery program adopted by the new Government with a second annual program under the ESAF. Poverty intensified with real per capita declining to US$142 in 2000. Since then Sierra Leone has been classified as the poorest country in the world and ranks at the bottom of the United Nations Development Programme (UNDP) Human Development Index. The growth in the economy has been underpinned by broad recovery in Agriculture, mining, manufacturing, construction and the service sector. The economy of the Country continues to worsen in early 1992 when the civil unrest started which causes untold sufferings on humans and the entire country. Many people were forced out of their houses and eventually became displaced persons and refugees in their own country and neighbouring country like Guinea, The Gambia and Ghana. Almost all segments of the business economy collapsed including banking and lending institutions. It was then the problems of growth in economy worsen and every thing completely deteriorated and collapsed. The almost 11 years of civil unrest ended in March 2002. The end of the war actually opens the door for a new beginning, for new economic growth and prosperity in the face of peace and unity. The situation has recently worsened because of the credit crunch faced by many of the world famous banking institutions and Sierra Leone has not been any exceptions. The effect coupled with other factors has created more gaps for banking institutions to provide loans to small and medium enterprises. In a press release from Prlog Dec. 15, 2008 by Robin Trehan as quoted â€Å"SMEs represent over ninety-nine percent of the country’s employers. While it is essential that these businesses obtain the necessary funding to remain active, they are often the first to suffer when financial crisis hits. Banks already facing financial hardship often deem SMEs as too risky to finance. Credit terms are becoming increasingly harder and qualifying for financing is subject to much stricter guidelines. The re are things that SMEs can do, however, to increase their chances of finding financing†. 1.2 Statement of the Problem The term credit in this thesis refers to an amount or sum placed at a person’s disposal by a bank and usually to be repaid with interest within a given period of time. Small and Medium Size Enterprises (SME) is very important in terms of the dynamic role in the development of the private sector in Sierra Leone. The SME’s are regarded as an engine for any economic growth and development in any country. They provide opportunities for job creation and expansion in the physical reconstruction of the economy especially for a post war development country like Sierra Leone. Majority of the physical infrastructures ranging from housing, office buildings and business structures were all destroyed during the civil unrest. These structures need to be reconstructed for the economy to grow and become prosper. Today many construction companies or firms have emerged to assist in the rehabilitation and reconstruction. While there may be some of the construction companies who have existed of years, it is also true that majority of these construction companies are new ones who are just coming up to help and provide their expertise in the development of Sierra Leone. But yet still, it is a challenge for many of these companies to adequately involve in the process of rehabilitation and reconstruction simply because they cannot get the required finance in the form of overdraft or loans, or provide the necessary collateral for the banks as required, making them less competitive. In Sierra Leone the performance of SME’s over the years has been very poor which is due to the fact that the creation of credit from the banks which is an essential stimulant for private investment in the construction industries has been grossly under performing. This is one of the reasons for poor performance of the economy in terms of growth in most developing countries including Sierra Leone. Construction companies have not been able to access huge funds by way of loan over the years from the banking and other financial institutions, mainly due to lack of confidence in the private sector as a result of problems like moral hazards and the absence of collateral security and the lack of experience in construction engineering. 1.3 Justification of the Study The importance of the construction industries in the process of rehabilitation and reconstruction of the war towns in Sierra Leone cannot be over-emphasized. During the war there was so much destruction of infrastructures in the country, now that there is peace there is high need for reconstructions and the development of new roads and structures to aid national growth. International organisations like the International Monetary Fund (IMF), World Bank, African Development Bank (ADB) main focus is to assist Small Medium Size Enterprises (SME) in developing countries gain strong financial base. It had been felt that SMEs employ majority of the work force in the developing countries, therefore, they have realised that when SME become financially stable the economy of the nation will be better and that the citizens will be able to live a comfortable life. The role of commercial banks and other financial institutions in private sector development and the assessment of their overall performance in terms of economic growth and development has not received much of the attention by researchers. The central bank maintaining interest rate at high level has greatly contributed to discourage SMEs from borrowing from retail banks and other financial institution for investment purposes. This is one of the reasons why most SMEs are under developed. Besides commercial banks are requesting for very stiff conditions to access loan by the private sector. A study on the provision of credit to construction companies for investment towards economic growth has not been studied in greater detail by previous researchers. This among others, gave me the urge to probe into the activities of the commercial banks and other financial institutions in the creation of credit to construction companies in Sierra Leone, This study is to help government and other professionals as well as other stakeholders, to grasp fully the implications of credit refusal to small and medium size enterprises and how it will affect the development of the nation. The result of this study is hope to enable banking and other financial institutions, local and national government and other stakeholders to device concrete ways by which small and medium size enterprises can easily get access to credit to undertake construction programmes. 1.4 Objectives of the study The main aim of the study is to assess the implications of credit creations by the banks and other financial institutions to Small and Medium Size Enterprises with special focus on the Construction Industries for economic growth and development in Sierra Leone. The specific objectives are: To determine the extent to which banks have been contributing to the development of the construction industries in Sierra Leone. To examine some of the reasons responsible for the inability of the construction industries to solicit loans from the banks and other financial institutions for the purpose of investment. To establish reasons for the reluctance of the banking and other financial institutions to provide the much needed funds for private sector development. To examine the reasons for the reluctance of the banking sector to provide the much needed funds for SME in the construction industries for development, even though SME’s are regarded as the engine of economic growth. 1.5 Research Questions: Certain research questions will be drawn up for proper examination of this objective. These include: To what extent do commercial banks provide funds to Small and Medium Size Enterprises in the construction Industries? What are the main problems encountered by the construction companies in terms of securing loans and overdrafts from the commercial banks? What is responsible for the low investment of the private sector (SME’s) in Sierra Leone? What is the role of the central bank in facilitating credit creation for SME’s in the pursuit of development in Sierra Leone? What is the role of the Government ministry in the area of infrastructural developmental plans for Sierra Leone? The study will make use of secondary data received from the Bank of Sierra Leone, Commercial Banks and some of the registered construction companies in Sierra Leone. The study will try to reveal the reasons for the constraints Small and Medium size Enterprises are facing in securing credit facilities from the banks. Interviews will be conducted with senior officers of both the banking industries and construction sectors, together with government officers in the area of national development for the country. 1.6 Definition of Operational Terms: 1. Credit Creation: Credit creation is the multiple expansions of banks demand deposits. It is an open secret now that banks advance a major portion of their deposits to the borrowers and keep smaller parts of deposits to the customers on demand. 2. Venture Capital: Venture Capital is the name given to equity finance provided to support new, expanding and entrepreneurial businesses. Venture capitalists usually prefer to take a close interest in the business that is the subject of their investment. This could involve taking part in decision made by the business. Funds provided by venture capitalist are often referred to as private capital.(Mclaney E, 2003) 3. Gearing: Small businesses are in a fundamentally different position from that of the larger one on the issue of gearing. Financial risk to which capital gearing gives rise tends to emphasise operating risk, which will be present with or without gearing. Small businesses are more exposed to financial risk than public liability companies. (Mclaney, 2003) 4. Bank and Institutional Debt: Long term loans are available from banks and other financial institutions at both fixed and floating interest rates, provided the issuing bank is convinced that the purpose of the loan is a good one. The cost of bank loan is usually a floating rate of 3-6 percent above the base rate, depending on the perceived risk of the borrowing company. The issuing bank charges an arrangement fee on bank loans, which are usually secured by a fixed and floating charge, the nature of the charge depending on the availability of assets of good quality to act as security. A repayment schedule is often agreed between the bank and the borrowing company, structured to meet the specific needs of the borrower and in accordance with the lending policies of the bank. (Watson D Head A, 2007) 5. Security –the Bank’s Perspective: A bank has little to lose and much to gain by taking security for a loan. A bank’s solicitor should check that the borrower and any other party providing security have capacity to do so. (The company act 1989, prima facie, a company could pursue only the objects for which its memorandum stated it was incorporated) 6. Security – the Borrower’s Perspective: It is often difficult for a borrower to argue against a reasonable request for security. However, some borrowers will be contractually prohibited from providing security by a negative pledge in a document to which they are already a party. Specialised lending for financing a project will always be secured over the asset or project in question. (Adams D, 2006) 7. Cash Flow Statements for Small Companies: Financial Report Standard (FRS1) prescribes a format for cash flow statements. Except for very small companies, all companies are required to prepare a cash flow statement for each accounting period. There are two approaches available under the standard; the direct method which shows the operating cash receipts and payments summing to the net cash flow from operating activities, and the indirect method which identifies the net cash flow via reconciliation to operating profit. (Wood F, 2002). CHAPTER 2 Literature Review 2.0 Introduction The purpose of this chapter is to make a review of related literature on Small and Medium isze Enterprises and the Creation of Credit in the Construction Industry. With these literatures the researcher will have a better understanding of the study, as well as what has already been done on it in the form of previous research. 2.2 Definition of Small and Medium Size Enterprises A business can be considered small on basis of predetermined criteria such as the number of employees, annual turnover or capital employed. In the late 1990s, it was estimated that small businesses with fewer than 50 employees accounted for 99 per cent of all UK business, almost 50 per cent of non government employment and 42 per cent of turnover. Small firms have become a focus for governmental policy at both national and intergovernmental level. Bolton in his report in 1971 identified three main characteristics of a small firm: were independently owned The business securities are not quoted in any established capital market that is they are not traded in the efficient market. were managed in a personalised way- The ownership of the business’s equity and hence its control lie in the hands of a small close knit-group; that is it is a family type business. possessed a limited share of the total market 2.3 Nature of Small and Medium Size Enterprises The Bolton report, the first official government inquiry into small firms attempted to establish standard definitions of small firms for particular sector of industry based on numerical indicators of size such as sales or number of employees. A firm with 250 employees in a labour intensive industry may still be a small firm. (Brown, 1987) Criteria for Small and Medium Size Enterprises Size Category Number of Employees Maximum Annual Turnover (euros) Maximum Balance balance sheet total Micro Firm 0 -9 2 million euros 2 million Small Firm 10 – 49 10 million euros 10 million Medium-sized Firm 50 – 249 50 million 43 million 2.4 Objectives of Small and Medium Size Enterprises In SME’s the managers and the shareholders are likely to be substantially the same person or at least closely connected with one another. Thus agency problems, and their potential associated costs, are likely to have little or possibly no impact on the typical small business. Because of the elimination of agency gap, most managers of SME’s are shareholder; they would make decisions following a pure wealth-maximising goal more determinedly than would be the case in the typical large enterprise. The motives of managers or owners of small businesses are diverse. These motives might be the desire to experience the satisfaction of building up a business, a desire to lead a particular way of life, or a desire to keep someone (perhaps family) tradition alive. Since it is possible for managers to know the personal objectives of shareholders of small business, decisions can probably be made with these in mind. Both large and small businesses that makes a series of decisions causing the wealth to diminish, will sooner or later fail. Wealth maximisation goal is very important to small business and cannot be ignored. 2.5 Organisation of Small and Medium Enterprises The research will consider Small and Medium Size Enterprises in the construction industries that are organised as private limited companies. According to Mclaney (2003) private companies need be of no minimum size; public companies must issue at least  £50,000 of nominal share capital, of which 25% must be paid up. There is no upper limit on the size of a private company. Private companies are entitled to restrict the transfer of their shares; that is it is possible for the company’s Articles of Association to contain a clause giving the directors the power to refuse to register a transfer, at their discretion. While private companies must publish annual accounts, the volume of details is rather less than that which the law requires of public companies. 2.6 Sources of Finance for Small and Medium Size Enterprises Several inquires have dealt with the financing of SMEs and each of these enquires discovered, to a greater extent, that small businesses find it more difficult and more expensive to raise external finance. A particular problem faced by small businesses in their quest for equity capital is the lack of an `exit route’. Generally investors require that there be some way of liquidating their investment before they are prepared to commit funds to it. A number of schemes have been introduced to help small businesses: 2.6.1. The loan Guarantee Scheme (LGS) as first introduced in 1981 to cover situations were potential borrowers were unable to provide sufficient collateral or where the bank deem the risk of lending unacceptable. 2.6.2. The Enterprise Investment Scheme (EIS) – This scheme replaced the Business Expansion Scheme (BES) and it is designed to help small unquoted companies to raise equity finance from business angels 2.6.3.The Venture Capital Trust (VCT) – The trust was introduced in 1995 to encourage individuals to invest in smaller, unlisted trading companies. Venture Capital is the name given to equity finance provided to support new, expanding and entrepreneurial businesses. Venture capitalists usually prefer to take a close interest in the business. This could involve taking part in decision made by the business. Funds provided by venture capitalist are often referred to as private capital.(Mclaney E, 2003) 2.6.4. The Enterprise Fund (EF) it was announced in the competitiveness white paper in 1998 and is designed to help the financing of small businesses with growth potential. 2.6.5. The National Business Angel Network (NBAN) it was launched in 1999 to connect ‘business angels’ with companies seeking equity capital 2.6.6. The late payment of Commercial Debts (Interest) act 1998 gives certain small businesses a statutory right to claim interest from large businesses and the public sector on late payment of commercial debts. 2.7 Gearing Small businesses are in a fundamentally different position from that of the larger one on the issue of gearing. Financial risk to which capital gearing gives rise tends to emphasise operating risk, which will be present with or without gearing. Small businesses are more exposed to financial risk than public liability companies.(Mclaney,2003) 2.8 Help and Advice to Small Businesses One of the major barriers faced by SMEs is the lack of information, help and advice on their operations. Recent initiative to improve this sphere includes: 2.8.1. The business link network – organised in 1993 as a ‘one stop shop’ for information and advice to SMEs. It brings together the services of major business development services in the single accessible location. 2.8.2. The Enterprise Zone – launched in 1997 as a definitive internet site for business information. It provides help on a whole range of business issues. 2.8.3. The Information Society Initiative/Interforum E-Commerce Award – launched in 1999 as part of government’s e-commerce strategy. It is essentially an award scheme to recognise and reward best practice in the use of electronic trading among smaller firms. 2.9 Bank and Institutional Debt Long term loans are available from banks and other financial institutions at both fixed and floating interest rates, provided the issuing bank is convinced that the purpose of the loan is a good one. The cost of bank loan is usually a floating rate of 3-6 percent above the base rate, depending on the perceived risk of the borrowing company. The issuing bank charges an arrangement fee on bank loans, which are usually secured by a fixed and floating charge, the nature of the charge depending on the availability of assets of good quality to act as security. A repayment schedule is often agreed between the bank and the borrowing company, structured to meet the specific needs of the borrower and in accordance with the lending policies of the bank. (Watson D Head A, 2007) 2.10 Security –the Bank’s Perspective A bank has little to lose and much to gain by taking security for a loan. A bank’s solicitor should check that the borrower and any other party providing security have capacity to do so. (The company act 1989, prima facie, a company could pursue only the objects for which its memorandum stated it was incorporated) 2.11 Security – the Borrower’s Perspective It is often difficult for a borrower to argue against a reasonable request for security. However, some borrowers will be contractually prohibited from providing security by a negative pledge in a document to which they are already a party. Specialised lending for financing a project will always be secured over the asset or project in question. (Adams D,2006) 2.12 Working Capital Problems of the Small Business Working capital is the difference between current assets over current liabilities. The amount invested by businesses in working capital is often high in proportion to the total assets employed. It is important that these amounts are managed properly. It is often claimed that many small businesses suffer from a lack of capital and, where this is the case, tight control over working capital investment becomes critical. There are evidence, however, that SB are not very good at managing their working capital, and this has been cited as the major cause of their high failure rate compared with that of large businesses. 2.13 Credit Management Small businesses don’t have the resources to manage their trade debtors (account receivables) effectively. Most small businesses don’t have a credit control department. Small business also lack proper debt collection procedures, such as prompt invoicing and sending out regular statements. These risks probably tend to increase where there is an excessive concern for growth. In an attempt to increase sales, small businesses may be too willing to extend credit to customers that are poor credit risk Lack of market power is another issue for small businesses. They find themselves in a weak position when negotiating credit terms with larger businesses. When big customer exceeds the terms of credit, the small supplier may feel inhibited from pressing the customer for payment in case future sales are lost. (A survey undertaken by the Credit Management Research Centre (CMRC) during April and June, 2003, indicates that small businesses are likely to have to wait an average of 60 days for their trade debtors to pay. 2.14 Cash Flow Statements for Small Companies Financial Report Standard (FRS1) prescribes a format for cash flow statements. Except for very small companies, all companies are required to prepare a cash flow statement for each accounting period. There are two approaches available under the standard; the direct method which shows the operating cash receipts and payments summing to the net cash flow from operating activities, and the indirect method which identifies the net cash flow via reconciliation to operating profit.(Wood F,2002) Credit Creation 2.15 Definition of Credit Creation The BNET business dictionary defines credit creation as the collective ability of lenders to make money available to borrowers. Credit creation is the multiple expansions of banks demand deposits. Banks advance a major portion of their deposits to the borrowers and keep smaller parts of deposits to customers on demand. The tendency on the part of commercial banks to expand their demand deposits as a multiple of their excess cash reserve is called creation of credit. 2.16 Functions of Financial Intermediation in Credit Creation Financial intermediation is the process of channelling funds between those who wish to lend or invest and those who wish to borrow or require investment funds. Financial intermediaries act as principal, creating new financial assets and liabilities. They do not act solely as agents, charging a commission for their services. (The Monetary and Financial System-CIB/BPP Publication 1993 Edition) Any institution standing between the ultimate provider of funds and the ultimate user of funds is engaged in financial intermediation. There are many types of institutions and other organisations that act as intermediaries in matching firms and individuals who need finance with those who wish to invest. These institutions also provide other services which are non-intermediary services like financial advisory services, fund management services and advice to undertakers and mergers provider by merchant banks. Some of the organisation that acts as financial intermediaries is as follows: 2.16.1 Clearing Banks – this bank participate in system which simplifies daily payment so that all the thousands of individual customer payments are reduced to a few transfers of credit between the banks. They offer various accounts to investors and provide large amount of short to medium-term loans to the business sector and the personal sector. The work of these institutions can best be understood through a consideration of the main items in their balance sheet. 2.16.2 Clearing Bank Liabilities – The money from the banks responsible comes chiefly from their customer’s sight and time deposits- mostly current and deposit accounts with which most people are familiar. An important additional item relates to certificates of deposit. These are issued generally for a medium amount of  £50,000 and a maximum of  £500,000 with an initial term to maturity of from three months to five years. Clearing Bank Assets Customers’ money is re-lent in a variety of ways. The main aim of the bank is to have a range of lending instruments of varying terms so that money can be recovered quickly and yet, at the same time, earn the maximum return. 2.16.3 Investment Banks / Merchant Banks The investment banks or Merchant banks have some functions that they undertake: 2.16.3.i Financial Advice to Business Firms Few manufacturing or commercial companies of any size can now afford to be without the advice of a merchant bank. Such advice is necessary in order to obtain investment capital, to invest surplus funds, to guard against takeover, or to take over others. Increasingly, the merchant banks have themselves become activity involved in the financial management of their business client and have had an influence over the direction these affairs have taken. 2.16.3.ii Providing Finance to Business Merchant banks also compete in the services of leasing, factoring, hire-purchase and general lending. They are also the gateway to the capital market for long-term funds because they are likely to have specified departments handling capital issues as ‘issuing houses’. 2.16.4 Foreign Trade A lot of merchant bank are active in the promotion of foreign trade by providing marine insurance, credits, and assistance in appointing foreign agents and arranging foreign payments. Merchant bank is essentially in the general business of creating wealth and of helping those who show that they are capable of successful business enterprise. It is expected that merchant banks will operate without the large branch network necessary for a clearing bank, they work closely with their clients and be more ready to take business risk and promote business enterprise than clearing bank. 2.16.5 Building Societies These take deposits from the household sector and lend to individuals buying their own homes. They have recently grown rapidly in the UK and now provide many of the services offered by clearing banks. Over the years many have converted to banks. 2.16.6 Finance Companies/Houses – Providing medium-term instalment credits to the business and personal sector. These are usually owned by business sector firms or by other financial itermediaries. 2.17 Services Provided by Financial Institutions Financial institutions are organisations that provide services in connection with one or more of the following:- Financial intermediation, linking ultimate providers of funds with ultimate users and creating new financial assets in the process. Exchanging financial assets on behalf of their customers, that is acting as brokers or agents for clients. Exchanging financial assets for their own accounts proprietary dealers, as they are termed. Helping to create financial assets for their customers, and then selling these assets to others in the market underwriting new share issues, for example Providing investment advice to others, example to people seeking a personal pension or to firms on mergers and takeovers. Fund management- managing the whole or part of a pension fund, for example some large non-financial companies have their own financial subsidiaries. In the United Kingdom Ford Motor Finance and Mark and Spencer Finance Se Development of Credit Facilities in Sierra Leone Development of Credit Facilities in Sierra Leone Chapter 1 This study is on the creation of credit facilities to Small and Medium Size Enterprises in Sierra Leone with special focus on the construction industries. 1.1 Background to the Economy of Sierra Leone Sierra Leone is a relatively small country, on the West Coast of Africa with an area of approximately 28,000square miles. The estimated population is 5.5 million inhabitants, 30% of whom resides in the western area of the country according to recent census in 2006. The state of the country’s economy, immediately after independence from the British Colony in 1961 up to the 1970’s, was quite satisfactory in terms of performance. The exchange rate between the Leone and other foreign currencies was relatively good. More so, the British Pound Sterling was exchanged at One pound ( £1) to One Leone (Le1). The inflation rate was extremely low. The country’s earnings from exports were very much attractive, with Diamond export accounting for well over 50% of the country’s foreign exchange earnings. This was closely followed by cash crop exports such as Cocoa, coffee, oil palm, piassava and chillies. The country’s external debt position at this time was not high, Between 1972 to 1975, the economy started experiencing down turn that was mainly due to external factors, such as the famous oil price shock in 1973. Naturally, the 1980 Organisation of Africa Unity (OAU) summit that was hosted by the government of Sierra Leone fuelled the debt crisis in Sierra Leone. Because of the foreign exchange scarcity in the country, the credit agreement between domestic importers and their business partners aboard collapsed. In 1988, the country was forced to devalue her currency. Between 1992 and 1994, Sierra Leone successfully implemented an adjustment program supported by the International Monetary Fund (IMF) under the Right Accumulation Program (RAP). The World Bank also supported the program through the Reconstruction of Import Credit (RIC) in 1992 and the Structural Adjustment Credit (SAC) in 1993. Following the successful implementation of the RAP, the IMF approved a three year arrangement support under Enhanced Structural Adjustment Facility (ESAF). The implementation of the first annual program was disrupted by the escalation of the rebel activities in 1995. With the return of democracy in 1996, the IMF supported the economic recovery program adopted by the new Government with a second annual program under the ESAF. Poverty intensified with real per capita declining to US$142 in 2000. Since then Sierra Leone has been classified as the poorest country in the world and ranks at the bottom of the United Nations Development Programme (UNDP) Human Development Index. The growth in the economy has been underpinned by broad recovery in Agriculture, mining, manufacturing, construction and the service sector. The economy of the Country continues to worsen in early 1992 when the civil unrest started which causes untold sufferings on humans and the entire country. Many people were forced out of their houses and eventually became displaced persons and refugees in their own country and neighbouring country like Guinea, The Gambia and Ghana. Almost all segments of the business economy collapsed including banking and lending institutions. It was then the problems of growth in economy worsen and every thing completely deteriorated and collapsed. The almost 11 years of civil unrest ended in March 2002. The end of the war actually opens the door for a new beginning, for new economic growth and prosperity in the face of peace and unity. The situation has recently worsened because of the credit crunch faced by many of the world famous banking institutions and Sierra Leone has not been any exceptions. The effect coupled with other factors has created more gaps for banking institutions to provide loans to small and medium enterprises. In a press release from Prlog Dec. 15, 2008 by Robin Trehan as quoted â€Å"SMEs represent over ninety-nine percent of the country’s employers. While it is essential that these businesses obtain the necessary funding to remain active, they are often the first to suffer when financial crisis hits. Banks already facing financial hardship often deem SMEs as too risky to finance. Credit terms are becoming increasingly harder and qualifying for financing is subject to much stricter guidelines. The re are things that SMEs can do, however, to increase their chances of finding financing†. 1.2 Statement of the Problem The term credit in this thesis refers to an amount or sum placed at a person’s disposal by a bank and usually to be repaid with interest within a given period of time. Small and Medium Size Enterprises (SME) is very important in terms of the dynamic role in the development of the private sector in Sierra Leone. The SME’s are regarded as an engine for any economic growth and development in any country. They provide opportunities for job creation and expansion in the physical reconstruction of the economy especially for a post war development country like Sierra Leone. Majority of the physical infrastructures ranging from housing, office buildings and business structures were all destroyed during the civil unrest. These structures need to be reconstructed for the economy to grow and become prosper. Today many construction companies or firms have emerged to assist in the rehabilitation and reconstruction. While there may be some of the construction companies who have existed of years, it is also true that majority of these construction companies are new ones who are just coming up to help and provide their expertise in the development of Sierra Leone. But yet still, it is a challenge for many of these companies to adequately involve in the process of rehabilitation and reconstruction simply because they cannot get the required finance in the form of overdraft or loans, or provide the necessary collateral for the banks as required, making them less competitive. In Sierra Leone the performance of SME’s over the years has been very poor which is due to the fact that the creation of credit from the banks which is an essential stimulant for private investment in the construction industries has been grossly under performing. This is one of the reasons for poor performance of the economy in terms of growth in most developing countries including Sierra Leone. Construction companies have not been able to access huge funds by way of loan over the years from the banking and other financial institutions, mainly due to lack of confidence in the private sector as a result of problems like moral hazards and the absence of collateral security and the lack of experience in construction engineering. 1.3 Justification of the Study The importance of the construction industries in the process of rehabilitation and reconstruction of the war towns in Sierra Leone cannot be over-emphasized. During the war there was so much destruction of infrastructures in the country, now that there is peace there is high need for reconstructions and the development of new roads and structures to aid national growth. International organisations like the International Monetary Fund (IMF), World Bank, African Development Bank (ADB) main focus is to assist Small Medium Size Enterprises (SME) in developing countries gain strong financial base. It had been felt that SMEs employ majority of the work force in the developing countries, therefore, they have realised that when SME become financially stable the economy of the nation will be better and that the citizens will be able to live a comfortable life. The role of commercial banks and other financial institutions in private sector development and the assessment of their overall performance in terms of economic growth and development has not received much of the attention by researchers. The central bank maintaining interest rate at high level has greatly contributed to discourage SMEs from borrowing from retail banks and other financial institution for investment purposes. This is one of the reasons why most SMEs are under developed. Besides commercial banks are requesting for very stiff conditions to access loan by the private sector. A study on the provision of credit to construction companies for investment towards economic growth has not been studied in greater detail by previous researchers. This among others, gave me the urge to probe into the activities of the commercial banks and other financial institutions in the creation of credit to construction companies in Sierra Leone, This study is to help government and other professionals as well as other stakeholders, to grasp fully the implications of credit refusal to small and medium size enterprises and how it will affect the development of the nation. The result of this study is hope to enable banking and other financial institutions, local and national government and other stakeholders to device concrete ways by which small and medium size enterprises can easily get access to credit to undertake construction programmes. 1.4 Objectives of the study The main aim of the study is to assess the implications of credit creations by the banks and other financial institutions to Small and Medium Size Enterprises with special focus on the Construction Industries for economic growth and development in Sierra Leone. The specific objectives are: To determine the extent to which banks have been contributing to the development of the construction industries in Sierra Leone. To examine some of the reasons responsible for the inability of the construction industries to solicit loans from the banks and other financial institutions for the purpose of investment. To establish reasons for the reluctance of the banking and other financial institutions to provide the much needed funds for private sector development. To examine the reasons for the reluctance of the banking sector to provide the much needed funds for SME in the construction industries for development, even though SME’s are regarded as the engine of economic growth. 1.5 Research Questions: Certain research questions will be drawn up for proper examination of this objective. These include: To what extent do commercial banks provide funds to Small and Medium Size Enterprises in the construction Industries? What are the main problems encountered by the construction companies in terms of securing loans and overdrafts from the commercial banks? What is responsible for the low investment of the private sector (SME’s) in Sierra Leone? What is the role of the central bank in facilitating credit creation for SME’s in the pursuit of development in Sierra Leone? What is the role of the Government ministry in the area of infrastructural developmental plans for Sierra Leone? The study will make use of secondary data received from the Bank of Sierra Leone, Commercial Banks and some of the registered construction companies in Sierra Leone. The study will try to reveal the reasons for the constraints Small and Medium size Enterprises are facing in securing credit facilities from the banks. Interviews will be conducted with senior officers of both the banking industries and construction sectors, together with government officers in the area of national development for the country. 1.6 Definition of Operational Terms: 1. Credit Creation: Credit creation is the multiple expansions of banks demand deposits. It is an open secret now that banks advance a major portion of their deposits to the borrowers and keep smaller parts of deposits to the customers on demand. 2. Venture Capital: Venture Capital is the name given to equity finance provided to support new, expanding and entrepreneurial businesses. Venture capitalists usually prefer to take a close interest in the business that is the subject of their investment. This could involve taking part in decision made by the business. Funds provided by venture capitalist are often referred to as private capital.(Mclaney E, 2003) 3. Gearing: Small businesses are in a fundamentally different position from that of the larger one on the issue of gearing. Financial risk to which capital gearing gives rise tends to emphasise operating risk, which will be present with or without gearing. Small businesses are more exposed to financial risk than public liability companies. (Mclaney, 2003) 4. Bank and Institutional Debt: Long term loans are available from banks and other financial institutions at both fixed and floating interest rates, provided the issuing bank is convinced that the purpose of the loan is a good one. The cost of bank loan is usually a floating rate of 3-6 percent above the base rate, depending on the perceived risk of the borrowing company. The issuing bank charges an arrangement fee on bank loans, which are usually secured by a fixed and floating charge, the nature of the charge depending on the availability of assets of good quality to act as security. A repayment schedule is often agreed between the bank and the borrowing company, structured to meet the specific needs of the borrower and in accordance with the lending policies of the bank. (Watson D Head A, 2007) 5. Security –the Bank’s Perspective: A bank has little to lose and much to gain by taking security for a loan. A bank’s solicitor should check that the borrower and any other party providing security have capacity to do so. (The company act 1989, prima facie, a company could pursue only the objects for which its memorandum stated it was incorporated) 6. Security – the Borrower’s Perspective: It is often difficult for a borrower to argue against a reasonable request for security. However, some borrowers will be contractually prohibited from providing security by a negative pledge in a document to which they are already a party. Specialised lending for financing a project will always be secured over the asset or project in question. (Adams D, 2006) 7. Cash Flow Statements for Small Companies: Financial Report Standard (FRS1) prescribes a format for cash flow statements. Except for very small companies, all companies are required to prepare a cash flow statement for each accounting period. There are two approaches available under the standard; the direct method which shows the operating cash receipts and payments summing to the net cash flow from operating activities, and the indirect method which identifies the net cash flow via reconciliation to operating profit. (Wood F, 2002). CHAPTER 2 Literature Review 2.0 Introduction The purpose of this chapter is to make a review of related literature on Small and Medium isze Enterprises and the Creation of Credit in the Construction Industry. With these literatures the researcher will have a better understanding of the study, as well as what has already been done on it in the form of previous research. 2.2 Definition of Small and Medium Size Enterprises A business can be considered small on basis of predetermined criteria such as the number of employees, annual turnover or capital employed. In the late 1990s, it was estimated that small businesses with fewer than 50 employees accounted for 99 per cent of all UK business, almost 50 per cent of non government employment and 42 per cent of turnover. Small firms have become a focus for governmental policy at both national and intergovernmental level. Bolton in his report in 1971 identified three main characteristics of a small firm: were independently owned The business securities are not quoted in any established capital market that is they are not traded in the efficient market. were managed in a personalised way- The ownership of the business’s equity and hence its control lie in the hands of a small close knit-group; that is it is a family type business. possessed a limited share of the total market 2.3 Nature of Small and Medium Size Enterprises The Bolton report, the first official government inquiry into small firms attempted to establish standard definitions of small firms for particular sector of industry based on numerical indicators of size such as sales or number of employees. A firm with 250 employees in a labour intensive industry may still be a small firm. (Brown, 1987) Criteria for Small and Medium Size Enterprises Size Category Number of Employees Maximum Annual Turnover (euros) Maximum Balance balance sheet total Micro Firm 0 -9 2 million euros 2 million Small Firm 10 – 49 10 million euros 10 million Medium-sized Firm 50 – 249 50 million 43 million 2.4 Objectives of Small and Medium Size Enterprises In SME’s the managers and the shareholders are likely to be substantially the same person or at least closely connected with one another. Thus agency problems, and their potential associated costs, are likely to have little or possibly no impact on the typical small business. Because of the elimination of agency gap, most managers of SME’s are shareholder; they would make decisions following a pure wealth-maximising goal more determinedly than would be the case in the typical large enterprise. The motives of managers or owners of small businesses are diverse. These motives might be the desire to experience the satisfaction of building up a business, a desire to lead a particular way of life, or a desire to keep someone (perhaps family) tradition alive. Since it is possible for managers to know the personal objectives of shareholders of small business, decisions can probably be made with these in mind. Both large and small businesses that makes a series of decisions causing the wealth to diminish, will sooner or later fail. Wealth maximisation goal is very important to small business and cannot be ignored. 2.5 Organisation of Small and Medium Enterprises The research will consider Small and Medium Size Enterprises in the construction industries that are organised as private limited companies. According to Mclaney (2003) private companies need be of no minimum size; public companies must issue at least  £50,000 of nominal share capital, of which 25% must be paid up. There is no upper limit on the size of a private company. Private companies are entitled to restrict the transfer of their shares; that is it is possible for the company’s Articles of Association to contain a clause giving the directors the power to refuse to register a transfer, at their discretion. While private companies must publish annual accounts, the volume of details is rather less than that which the law requires of public companies. 2.6 Sources of Finance for Small and Medium Size Enterprises Several inquires have dealt with the financing of SMEs and each of these enquires discovered, to a greater extent, that small businesses find it more difficult and more expensive to raise external finance. A particular problem faced by small businesses in their quest for equity capital is the lack of an `exit route’. Generally investors require that there be some way of liquidating their investment before they are prepared to commit funds to it. A number of schemes have been introduced to help small businesses: 2.6.1. The loan Guarantee Scheme (LGS) as first introduced in 1981 to cover situations were potential borrowers were unable to provide sufficient collateral or where the bank deem the risk of lending unacceptable. 2.6.2. The Enterprise Investment Scheme (EIS) – This scheme replaced the Business Expansion Scheme (BES) and it is designed to help small unquoted companies to raise equity finance from business angels 2.6.3.The Venture Capital Trust (VCT) – The trust was introduced in 1995 to encourage individuals to invest in smaller, unlisted trading companies. Venture Capital is the name given to equity finance provided to support new, expanding and entrepreneurial businesses. Venture capitalists usually prefer to take a close interest in the business. This could involve taking part in decision made by the business. Funds provided by venture capitalist are often referred to as private capital.(Mclaney E, 2003) 2.6.4. The Enterprise Fund (EF) it was announced in the competitiveness white paper in 1998 and is designed to help the financing of small businesses with growth potential. 2.6.5. The National Business Angel Network (NBAN) it was launched in 1999 to connect ‘business angels’ with companies seeking equity capital 2.6.6. The late payment of Commercial Debts (Interest) act 1998 gives certain small businesses a statutory right to claim interest from large businesses and the public sector on late payment of commercial debts. 2.7 Gearing Small businesses are in a fundamentally different position from that of the larger one on the issue of gearing. Financial risk to which capital gearing gives rise tends to emphasise operating risk, which will be present with or without gearing. Small businesses are more exposed to financial risk than public liability companies.(Mclaney,2003) 2.8 Help and Advice to Small Businesses One of the major barriers faced by SMEs is the lack of information, help and advice on their operations. Recent initiative to improve this sphere includes: 2.8.1. The business link network – organised in 1993 as a ‘one stop shop’ for information and advice to SMEs. It brings together the services of major business development services in the single accessible location. 2.8.2. The Enterprise Zone – launched in 1997 as a definitive internet site for business information. It provides help on a whole range of business issues. 2.8.3. The Information Society Initiative/Interforum E-Commerce Award – launched in 1999 as part of government’s e-commerce strategy. It is essentially an award scheme to recognise and reward best practice in the use of electronic trading among smaller firms. 2.9 Bank and Institutional Debt Long term loans are available from banks and other financial institutions at both fixed and floating interest rates, provided the issuing bank is convinced that the purpose of the loan is a good one. The cost of bank loan is usually a floating rate of 3-6 percent above the base rate, depending on the perceived risk of the borrowing company. The issuing bank charges an arrangement fee on bank loans, which are usually secured by a fixed and floating charge, the nature of the charge depending on the availability of assets of good quality to act as security. A repayment schedule is often agreed between the bank and the borrowing company, structured to meet the specific needs of the borrower and in accordance with the lending policies of the bank. (Watson D Head A, 2007) 2.10 Security –the Bank’s Perspective A bank has little to lose and much to gain by taking security for a loan. A bank’s solicitor should check that the borrower and any other party providing security have capacity to do so. (The company act 1989, prima facie, a company could pursue only the objects for which its memorandum stated it was incorporated) 2.11 Security – the Borrower’s Perspective It is often difficult for a borrower to argue against a reasonable request for security. However, some borrowers will be contractually prohibited from providing security by a negative pledge in a document to which they are already a party. Specialised lending for financing a project will always be secured over the asset or project in question. (Adams D,2006) 2.12 Working Capital Problems of the Small Business Working capital is the difference between current assets over current liabilities. The amount invested by businesses in working capital is often high in proportion to the total assets employed. It is important that these amounts are managed properly. It is often claimed that many small businesses suffer from a lack of capital and, where this is the case, tight control over working capital investment becomes critical. There are evidence, however, that SB are not very good at managing their working capital, and this has been cited as the major cause of their high failure rate compared with that of large businesses. 2.13 Credit Management Small businesses don’t have the resources to manage their trade debtors (account receivables) effectively. Most small businesses don’t have a credit control department. Small business also lack proper debt collection procedures, such as prompt invoicing and sending out regular statements. These risks probably tend to increase where there is an excessive concern for growth. In an attempt to increase sales, small businesses may be too willing to extend credit to customers that are poor credit risk Lack of market power is another issue for small businesses. They find themselves in a weak position when negotiating credit terms with larger businesses. When big customer exceeds the terms of credit, the small supplier may feel inhibited from pressing the customer for payment in case future sales are lost. (A survey undertaken by the Credit Management Research Centre (CMRC) during April and June, 2003, indicates that small businesses are likely to have to wait an average of 60 days for their trade debtors to pay. 2.14 Cash Flow Statements for Small Companies Financial Report Standard (FRS1) prescribes a format for cash flow statements. Except for very small companies, all companies are required to prepare a cash flow statement for each accounting period. There are two approaches available under the standard; the direct method which shows the operating cash receipts and payments summing to the net cash flow from operating activities, and the indirect method which identifies the net cash flow via reconciliation to operating profit.(Wood F,2002) Credit Creation 2.15 Definition of Credit Creation The BNET business dictionary defines credit creation as the collective ability of lenders to make money available to borrowers. Credit creation is the multiple expansions of banks demand deposits. Banks advance a major portion of their deposits to the borrowers and keep smaller parts of deposits to customers on demand. The tendency on the part of commercial banks to expand their demand deposits as a multiple of their excess cash reserve is called creation of credit. 2.16 Functions of Financial Intermediation in Credit Creation Financial intermediation is the process of channelling funds between those who wish to lend or invest and those who wish to borrow or require investment funds. Financial intermediaries act as principal, creating new financial assets and liabilities. They do not act solely as agents, charging a commission for their services. (The Monetary and Financial System-CIB/BPP Publication 1993 Edition) Any institution standing between the ultimate provider of funds and the ultimate user of funds is engaged in financial intermediation. There are many types of institutions and other organisations that act as intermediaries in matching firms and individuals who need finance with those who wish to invest. These institutions also provide other services which are non-intermediary services like financial advisory services, fund management services and advice to undertakers and mergers provider by merchant banks. Some of the organisation that acts as financial intermediaries is as follows: 2.16.1 Clearing Banks – this bank participate in system which simplifies daily payment so that all the thousands of individual customer payments are reduced to a few transfers of credit between the banks. They offer various accounts to investors and provide large amount of short to medium-term loans to the business sector and the personal sector. The work of these institutions can best be understood through a consideration of the main items in their balance sheet. 2.16.2 Clearing Bank Liabilities – The money from the banks responsible comes chiefly from their customer’s sight and time deposits- mostly current and deposit accounts with which most people are familiar. An important additional item relates to certificates of deposit. These are issued generally for a medium amount of  £50,000 and a maximum of  £500,000 with an initial term to maturity of from three months to five years. Clearing Bank Assets Customers’ money is re-lent in a variety of ways. The main aim of the bank is to have a range of lending instruments of varying terms so that money can be recovered quickly and yet, at the same time, earn the maximum return. 2.16.3 Investment Banks / Merchant Banks The investment banks or Merchant banks have some functions that they undertake: 2.16.3.i Financial Advice to Business Firms Few manufacturing or commercial companies of any size can now afford to be without the advice of a merchant bank. Such advice is necessary in order to obtain investment capital, to invest surplus funds, to guard against takeover, or to take over others. Increasingly, the merchant banks have themselves become activity involved in the financial management of their business client and have had an influence over the direction these affairs have taken. 2.16.3.ii Providing Finance to Business Merchant banks also compete in the services of leasing, factoring, hire-purchase and general lending. They are also the gateway to the capital market for long-term funds because they are likely to have specified departments handling capital issues as ‘issuing houses’. 2.16.4 Foreign Trade A lot of merchant bank are active in the promotion of foreign trade by providing marine insurance, credits, and assistance in appointing foreign agents and arranging foreign payments. Merchant bank is essentially in the general business of creating wealth and of helping those who show that they are capable of successful business enterprise. It is expected that merchant banks will operate without the large branch network necessary for a clearing bank, they work closely with their clients and be more ready to take business risk and promote business enterprise than clearing bank. 2.16.5 Building Societies These take deposits from the household sector and lend to individuals buying their own homes. They have recently grown rapidly in the UK and now provide many of the services offered by clearing banks. Over the years many have converted to banks. 2.16.6 Finance Companies/Houses – Providing medium-term instalment credits to the business and personal sector. These are usually owned by business sector firms or by other financial itermediaries. 2.17 Services Provided by Financial Institutions Financial institutions are organisations that provide services in connection with one or more of the following:- Financial intermediation, linking ultimate providers of funds with ultimate users and creating new financial assets in the process. Exchanging financial assets on behalf of their customers, that is acting as brokers or agents for clients. Exchanging financial assets for their own accounts proprietary dealers, as they are termed. Helping to create financial assets for their customers, and then selling these assets to others in the market underwriting new share issues, for example Providing investment advice to others, example to people seeking a personal pension or to firms on mergers and takeovers. Fund management- managing the whole or part of a pension fund, for example some large non-financial companies have their own financial subsidiaries. In the United Kingdom Ford Motor Finance and Mark and Spencer Finance Se