Advertising and Promotion Evaluating Arguments Essay Example for Free

Advertising and Promotion Evaluating Arguments Essay Emotional Argument 1- What if advertising does not exist? How a company wants to promote their products and services? 2- How mass media of advertising can promote a company’s products and services to potential customers. Ethical Argument 1- Leo Burnett, an advertising executive and the founder of Leo Burnett Worldwide Company said â€Å"Good advertising does not just circulate information. It penetrates the public mind with desires and belief.† 2- Robert Smith, an expert in advertising said, â€Å"Brand to consumer relevance† refer to situations where the advertised brand of a product or services is of personal interest to consumers. 3- Grant McCracken said advertisers must try to match the product or company’s image, the characteristics of the target market and the personality of the celebrities. Logical Arguments 1- A good advertising can attempt to persuade potential customers to purchase of a product. 2- A company cannot make dream to be a well known brand until they invests in their promotional activities for which costumer market have been dominating through advertisements. 3- Advertising is an important promotional tool for building company or brand as it is an effective way to provide customers with information and to influence their perception. See more: Social process essay What I found more persuasive Advertising is an effective way to promote a company’s product and service to potential costumer. Advertising is also a promotional tool for building company or brand as it is an effective way to provide customers with information and to influence their perceptions. This book is about the advertising and promoting of an integrated marketing communications perspective. The author gives lots of information of how advertising can be use by a company to promote their product. The author also states the definition, statistic and the development of advertising. The book is very interesting to read because the author used lots of color to divided every topics and give good examples. This book has a lot of photos for audiences to understand more what the author tried to say. I recommended the audiences to get more information about advertising from this book.

Visual Perception Essay -- Biology Essays Research Papers

Visual Perception Any one given experience an organism perceives must incorporate several sensory systems, that involves numerous number of organs , that further more are comprised of millions upon millions of firing cells. Perception is not a direct mirroring of stimulus, but a complex chaotic patterns dependent on the simultaneously activity of neurons. This essay deals primarily with neurons from the optical sensory system. The outer ridge of the brain, known as the cerebral cortex begins the analysis of sensory messages. (1) Nevertheless, visual perception is possibly more widespread than one area of the cerebral cortex and like ly over various subcortical structures and number of different systems as well. (2) One of the many ways for the "perception process" to begin, is vision. Vision is dependent on the interaction between light input and the eye. The visual input is seen through lens that takes different light outside, refract and bend into points of light that focus on specific places on the retina. This light-sensitive tissue that lines the back of the eye consists of interconnected neurons. The three diff erent types are receptor cells, bipolar cells and ganglian cells. When photoreceptors are stimulated, they change in structure of photopigments in the receptors and transduce light input into neural activity. (2) Electrical stimulus trave ls down the axon of bipolar cells to the ganglian cells. The ganglian cells are activated through nerve impulses or action potentials and travel down the optic nerve. This activity conducts along the optic nerve to the geniculate nucleus that then travels to the mid- brain. (2) Finally the firing neurons activity travels to the cortex at the back of the brain, known as the stria... ...ic methods are more reasonable than linear, straightforward procedures. Is it reasonable that all of what one perceives is dependent exclusively on a specific set of procedures, rather than the interaction of cells, organs and systems? The former process seems to be improbable, while the latter process proves to be a chaotic, massive and cooperative. It was alluded to in class that one does not need the formulized "picture" or the visual perception. Nonetheless, I think that this added perplexity is a necessity. The visual perception of the "picture" encourages our understanding of ourselves as we ll as our surroundings. Internet Sources: http://sulcus.berkeley.edu/FLM/MS/Physio.Percept.html Ratlif f, Floyd. "Contour and Contrast," Scientific American, June 1972, pp. 91-101 Crutchfield, James. "Chaos," Scientific American, December 1986, pp. 46-57

By Motivating people highest degree of involvement can be achieved Essay

Introduction Why do people do the things they do? How can I get people to do what ought to be done? How can I motivate people to opt for safety measures? What are they going to think about these measures? How can we change the attitude of people towards safety? Questions along these lines are amongst those that management has to be ready when it comes to changing the behavior of people towards safety. These challenges faced by the management can be overcome by the number of strategies adapted. There are two ways in which the workers can be motivated for safety of self, others and equipment (a) by rewarding them when the safety strategies are put into practice (b) and also best through by self-direction, self-control and disciplinary application. Text Indifferent Attitude Towards Safety We need to motivate workers towards safety so as to avoid and minimize accidents in the industry. The term accident can be defined as an event that results in unintended harm or damage it is a very unpleasant experience where losses can occur. In an industry it is usually a result of a contact with a source of energy (kinetic, chemical, electrical, radiation etc). In terms of damage, an accident could result in property damage such as fire, breakage, distortion etc. Why do these accidents occur there can be lot of reasons for that some of them are mentioned below: – Lack of Knowledge – The worker was not trained properly on a particular job, or he may not have had experience, skill to handle the job there was lack of orientation. The initial instructions given to him would not have been sufficient. Inadequate Leadership And/Or Supervision – His work was not supervised properly there was not adequate performance management and evaluation. The delegation of work was improper. There was no proper communication of policies, procedure and objectives. Inadequate communication of safety and health data. Communication Gap Between The Various Departments – All the departments are not co-operative and would not share their information with each other even if they need to work in close co-operation. Favoritism – There may be favoritism, which leads to demotion of some employees, which is highly de motivating and leads to indifferent attitude towards safety. Poor working conditions – In adequate lighting, lack of availability of safety devices and personal equipments, not a clean working environment, will not help employees to carry out work in the most safest manner. Here is when safety comes into picture it is defined as freedom from accidents or the condition of being safe from pain, injury or loss. It includes both preventing accidents and keeping losses to the minimum when accidents occur. Safety education and training is the only way we can prevent accidents and safeguard our employees the company from making huge looses due to accidents. Developing Safe Attitude For the development of safe attitude, there should be a high degree of participation by all employees and the management should be able to sustain their interest by providing them information about the various affects of an accident, consequences by the help of the following: * Posters – Should be located in places which are prone to accidents like near the equipments, corridors, areas where there are chemicals or big machineries to promote a theme or call attention to a problem, and changed at least monthly. * Handouts – Can be used in conjunction with monthly poster theme as reinforcement. Usually included in payroll envelope or can be mailed to the employee’s house. * In-House Newsletters – A separate section can be devoted to inform employees of current and future safety methods in a very informal way, messages by top management, achievement toward goals and ideas that worked. These are some items that will be of interest. * Suggestions – Employees should be encouraged to submit written ideas and suggestions. Providing a box where they can deposit these, gives them the feeling of having a direct line to management. * Group Safety Meetings – Are generally most effective when they involve top management, are planned to promote or train, and are of short duration (up to 1/2 hour). * Individual Safety Contacts – Usually performed by the employee’s supervisor on a scheduled basis, weekly to monthly, with one topic as the basis of discussion (5 to 15 minutes). * Safety Contests, Quizzes & Campaigns, etc. – These can be designed to reward individuals or groups. The best results are achieved when everyone is involved and many types of activities interface to promote the campaign or contest. Programs that show an interest from top management, through the supervisors, to the hourly employees, help to create the spirit of cooperation. Effective communication is a motivational tool. When top management knows and participates in the program, it communicates to all employees that safety is a company effort. Programs should be planned using a systematic approach aimed at the factors that are most influential to the affected employees. This will be much more effective than a hit-or-miss technique. Motivating For Safe Attitude When workers do not pay attention or are not interested (lack of proper attitude) managements answers are likely to be found in the realm of morale and motivation. The management knows that the employees have the know-how and are physically and mentally capable of doing the work correctly, conscientiously and safely – motivating these employees is a practical approach. So there to maintain interest, management has to see that the employees benefit directly. Interest will be aroused by activities that will appeal to them personally. However, everyone is not motivated by the same incentive. Therefore, activities that encompass several motivating factors will gain more overall participation. The key motivating factors are: Self -Preservation – Protection of oneself from harm or destruction is the most important motivational factors. The fear of injury can lead to safety and the management should sustain interest in this by highlighting the consequence of injury by videos, presentations, posters discussions and lectures. Personal and Material Gain – Monetary gain or getting a reward for their achievement appeals to a lot of people so the management should reward their achievements for outstanding safety performances. Like in a Oil Drilling Company if a particular rig does not have any accident for 1yr then all the employees of the rig get a certificate and a safety bonus. Loyalty – If a person is loyal towards the organization then he would have a greater interest in preventing the company from occurring losses. He would make it point to thoroughly understand the safety rules and implement it wherever possible because he feels the companies loss is his loss. Responsibility – The sense of responsibility of an employee will lead to active participation in safety measures. Like if a person would like to do a voluntary service by becoming a Loss Prevention team leader for a specific group so as to keep them updated with the latest in safety. Conformity – Fear of being different will be able to motivate a person to follow the policies, procedures of the safety measures. Violation of these methods would lead to serious consequence so therefore conformity would be a better choice and also prevent humiliation amongst other employees. Rivalry – Desire to compete in many people is a way of achieving things this can be used by management as an adequate tool of promoting safety measure by conducting contest on safety. Leadership – If a person has the traits of leadership then being a leader and training other people on safety issues could motivate him. Like giving presentations on using the different devices and equipments in the factories and this should be encouraged by the management by providing incentives to the leader. All these factors will help in achieving highest degree of involvement of the workers in the safety measure and help the organization to achieve its goal in a safest possible manner. Conclusion Safety has to be taken seriously in the industry. Now days industries are putting lot of emphasis on safety training and implementation as they know safety implementation and effectiveness is worth against the injury caused. If the behavior of the employees has to change for this the management has to change their attitude and motivate employees for taking up safety measure and using them. Although motivation is not a magic wand it takes knowledge, understanding, problem solving, empathy, interaction, patience and perseverance. But if used can work wonders.

Analysis of Gretel Ehrlichs About Men Free Essay Example, 1000 words

The essay About Men is a part of Gretel Ehrlich s book The Solace of Open Spaces where the writer describes her perception of Wyoming and understanding of its land and people (Hoy n. pag. ). That s why the perception of a cowboy s image is described in such a non-fictional way like a kind of metaphor or a sign that transfers a reader to some deeper interpretation of a cowboy, not as a profession, or some man from Marlboro s advertisement. Ehrlich s cowboy is a deeply perceptional character that possesses some crucially exceptional character traits that in some way characterize the kind of man that is considered to be an ideal. Thus the author describes the theme of conformity and rebellion in such way in order to emphasize the duality of man's nature and to reveal the universal truth of what men hide and what they actually demonstrate, which often are completely different things. What surprises us about the text s depiction of the theme is probably this universality of what the au thor describes, because there are different professions that could have been described instead of a cowboy in this essay. We will write a custom essay sample on Analysis of Gretel Ehrlich's About Men or any topic specifically for you Only $17.96 $11.86/page The way how Ehrlich describes it is very sensitive and imaginary so it almost reaches our intuitive perception of a cowboy s character and simultaneously transfers the perception on the men s general image. Thus the fact that the text is non-fiction benefits the sensual perception of the message that the author is trying to send to her reader. The point is that non-fiction texts are more apt to touch souls and influence those deep perceptional stimuli that activate people s imagination.

Media Acts And Its Impact On Society - 1190 Words

In our society today, media acts as an integral factor in creating and undoing social bonds, as well as communicating topics which enable social transformation. It is generally considered that political and economic subjects are rational and thus are treated as ‘men’s issues’, in comparison to social and cultural themes expressed as sensitive and accordingly correlated with femininity (Stevenson 1995). Although this is open to much criticism in terms of gender inequality, it is undoubtable that gender equality is progressing. Women have enrolled into conventionally male-dominated work places, reflecting the general consensus that women achieve better at school. Also, men have proceeded into ‘normally’ female-dominated areas such as†¦show more content†¦Over the course of the 40 years it was found that in both newspapers was an â€Å"evident gender bias, which has gradually overcome as new media genres have developed† (Stanley, 2012). I n the non-elite paper women are hardly pictured, and in the elite magazine women show up ‘just as often as men’ (Stanley, 2012). The audience of both papers consists of approximately 50% women and 50% men (Stanley, 2012). However, mirroring the diversity between elite and non-elite newspapers, â€Å"the typical reader of the New York Times has more formal education than is the case for the Daily News† (Daily News, 2012) (News York Times, 2012). Stanley states that the article addresses a myriad of key questions. Firstly, the progress of women’s appearance in newspapers today is explored in comparison to fifty years ago. Secondly, the location of where women are presented within the newspaper is of concern. The article then explores whether these locations are of similarity within elite and non-elite newspapers or whether they are different. An array of theoretical perspectives are provided, which are later used to justify and criticise findings. The first is an approach that the content within media is a parallel of realism; an increased number of women in society results in photography being progressively occupied by women. This is then followed by a supposition that the constitution of cultural presence in the media is influenced by cultural categories of editors

Human Rights For The Disabled - 1304 Words

Background The topic of human rights for the disabled came after centuries of discrimination and mistreatment by people who thought nothing of them. During the 1800s, people with disabilities were used in circuses or in sideshows for entertainment or were put in an asylum for their whole life. They were thought to be abnormal and pitiful. The Disability Rights Movement began in the United States after World War One, because disabled veterans demanded care from the government. The problem has developed into a global effort to protect and aid these people, along with others struggling with their human rights. Contributions by the UN have sparked initiatives, conventions and resolutions to be set in place. Undeveloped regions are most affected by lack of disabled rights, because of an absence of a strong government with strong laws and rights. The top ten worst countries for human rights are Nigeria, Yemen, Myanmar, Iraq, Afghanistan, Somalia, Pakistan, The Democratic Republic of Congo, Sudan, and Syria. These areas also suffer from so many other issues, which makes them a target for human rights issues. War, famine, genetics, diseases, complications during pregnancy,and disasters cause disabilities.People with disabilities live with â€Å"less legal protection, higher rates of poverty, lower educational achievements, poorer health outcomes and less political and cultural participation.† Because of the social barriers that are put up, people with disabilities were, and still are,Show MoreRelatedWomen s And Disability Issues Within A Broad Socio Cultural And Geographic Context Essay891 Words   |  4 Pagesview of disabled women and issues such as legal rights, housing, employment, mental illness, social assistance, and health care (Academia.edu. 2015). In 2010, she also co-edited a book on disabled people’s perspectives on society and space (Ashgate. 2015). She also appears to be branching out with similar topics and how they are seen in the southern hemisphe res. In her chapter on legal peripheries, Chouinard examines the social location in the context of legal rights as experienced by disabled peopleRead MoreUnderstanding the Disabled Essay1225 Words   |  5 Pagesmind of an able-bodied individual upon seeing a disabled person will undoubtedly pertain to their disability. This is for the most part because that is the first thing that a person would notice, as it could be perceived from a distance. However, due to the way that disability is portrayed in the media, and in our minds, your analysis of a disabled person rarely proceeds beyond that initial observation. This is the underlying problem behind why disabled people feel so under appreciated and discriminatedRead MoreThe Importance Of Inclusive Education729 Words   |  3 Pagessure that every adult and child receives basic good quality education and is based on the perspectives of human rights and also on held beliefs education is vital for national development and individual well -being. Nonetheless, various countries have not given sufficient attention to education for all marginalized groups particularly the children with disabilities or special needs. The disabled children have remained comparatively obscure in the efforts to attain universal primary education accessRead MoreRussi Children With Disabilities Face Violence, Neglect1548 Words   |  7 PagesDisabilities Face Violence, Neglect.† hrw. Human Rights Watch, 15 Sept. 2014. Web. 8 Jan. 2016. The article titled, â€Å"Russia: Children with Disabilities Face Violence, Neglect† (8. Jan. 2014) from the Human Rights Watch website asserts that the rights of disabled children are suppressed as they are often admitted to the terrible living conditions of an orphanage or institution, despite Russia’s recent governmental effort to address such rights. The Human Rights Watch article proves this claim by describingRead MoreDisabled a Poem by Wilfred Owen and Refugee Blues by W.H. Auden1219 Words   |  5 Pagesexpress their opinions on the sensitive topic of war, having experienced the direct impact of it first hand which is indisputably evident in their poems ‘Disabled’ and ‘Refugee Blues’ respectively. Both the poems focus on the intense depiction of the unglamorous consequences tied with war. ‘Disabled’ as per the title is about a young soldier disabled both physically and emotionally during combat. The poem is written in cl ose focus third person and zooms in on the soldier’s unwillingness to continueRead MoreUnderstanding the Proper Way to Treat the Disabled707 Words   |  3 PagesUnfortunately many communities still have ignorant views toward the disabled, which leads to discrimination and injustice toward the disabled community. The impaired community is made up of people who now live with a physical impairment, or a mental disability. Respect the disabled, they have rights that belong to them just as anyone; have courtesy, living with a disability does not mean being less capable, with the hardships that has faced the disabled community, they definitely deserve the same courtesy asRead MoreThe Development Of The Welfare State And Social Policies1563 Words   |  7 Pageshistorical literature, mental impairment has none (Borsay, 2005). The last 100 years have been dominant constructions of education based on human life and evaluation, preparing the working class for employment. Within soc iological terms the education system is the most important way in which society reproduces (Oliver Barton, 1997). The concept of educating disabled children in the UK, was a medically classified facility that expanded segregation practices from the past special school systems. The focusRead MoreChildren With Intellectual And Physical Disabilities1421 Words   |  6 Pagesintellectual and physical disabilities. These people don’t have any control over how they are born, but we as a nation have the authority over how they are taken care of. From reading the fictional book â€Å"Flowers for Algernon,† the nonfiction articles â€Å"Disabled Couple Forced to Live Apart,† and â€Å"Social Sensitivity.† Many people with disabilities are not allowed jobs and/or education. The percentage of unemployment for people with disabilities is 12.1. There are numerous laws prohibiting people from discriminatingRead MoreAbortion and Disability946 Words   |  4 Pagesvalues. (Total for Question 1 = 50 marks) There are several issues that arise when it comes to the development in medical ethics whilst also maintaining religious principles and ethical values. The development of medical knowledge has allowed for humans to practice different ways in helping society. But these new discoveries have found to clash with religious principles and ethical values. This can be related to the topic of abortion as it goes against monotheistic religious teachings. In the 21stRead MoreDiscrimination Against People With Disabilities1729 Words   |  7 Pagescommunity. The legal system needs to cater for all people, and particularly has a responsibility to protect the disabled, as they have different needs and cannot always protect themselves. The Universal Declaration of Human Rights determined by the United Nations provides basic human rights for all people under international law. The United Nations has also put forth the Convention on the Rights of Persons with Disabilities in 1975. However the convention is not compulsory for nations of the UN but is

Financial Review of Billabong Pty Ltd free essay sample

Billabong Financial Review Review of Billabong Financial information for 2005-2008 Note: tables are shown in $’000s (excluding $ values expressed with decimal places) Note: revenue is expressed and revenue from the sale of goods. Question 1 – Revenue and Revenue Margin 2005200620072008 Total Revenue $ (From the sale of goods)$840,701$1,018,227$1,222,911$1,347,618 % Change from previous year24. 60%21. 12%20. 10%10. 20% % Change from base year (2004)24. 60%50. 91%81. 24%99. 73% Change in $$165,972$177,526$204,684$124,707 It is important to note the $ value increases as it is not the biggest % increase. Showing strong growth until 2007, the 2008 smaller growth can be attributed to the GFC or that business expansion has slowed. This can be noticed in the Financial reports list of businesses owned by billabong increasing, from; â€Å"Billabong†, â€Å"Von Zipper†, â€Å"Element† and â€Å"Honolua Surf Co† in 2004 to the addition of; â€Å"Kustom†, â€Å"Palmers†, â€Å"Nixon†, â€Å"XCEL†, â€Å"Tigerlily†, â€Å"Sector 9† and Dakine up to 2008, this gives Billabong International a larger stake at market share, with their brands dominating surf shop shelves. Also with the addition of Billabong owned store fronts becoming more and more common, apposed to being a wholesale provider, the businesses expansion into new countries around the world and the growth of the brand within these countries has allowed Billabong to add to their ever-expanding global brand and an increasing revenue of 1422% over the past ten years, with now average growth of around 19% pa, a growth at perhaps a more manageable level, this shows a steep growth period that is and has for a few years been slowing down suggesting it may have reached its maximum profit potential. With all this in mind, we can see a company with a strong growth period that is now consolidating its position as one of the leading brands in this industry. Question 2 – Gross Profit margin Net Profit Margin GPM = GP (Revenue from sale of goods – Cost of Sales) / Sales * 100 20072008 Total Revenue (from sale of goods) $1,222,911$1,347,618 Minus Cost Of Sales$570,979$608,040 Equals GP $$651,932$739,578 GPM (GP$/Total Revenue*100)53. 31%54. 88% Gross profit margin shows us the percentage difference between sales and the cost of those sales. The result of the margin can help determine what the level of profitability is for the goods being produced. These results show a business that is more than doubling their money invested on the production of goods. Also, the figures show an increase in gross profit margin suggesting the business is becoming more efficient at production or sale of goods produced. These are both strong percentages that show the money invested into the production of goods is money well spent. NPM = NP (before tax interest) / Sales * 100 2005200620072008 Net Profit (Before tax Interest)$189,555$222,014$241,300$270,548 Over Total Revenue$840,701$1,018,227$1,222,911$1,347,618 Equals Net Profit Margin22. 55%21. 80%19. 73%20. 08% Net profit margin shows the margin of profit after expenses (however before tax interest). These percentages are reducing due to increased expenses, notably from increases in selling, general and administrative expenses and from cost of goods sold. Also expenses in depreciation are increasing; however this would be expected from a business at the tail end of a sharp growth period. The net profit margin is reducing to 2007 but showing some regain in 2008, perhaps the GFC and its effect on the cost, efficiency and ability of stimulating sales has had some impact on the 2007 decline but the business is still showing a strong financial position with reasonably steady profit margins. Question 3 – Return on Assets Return on Shareholder Equity ROA =NP (before tax Interest) / Average Total Assets * 100 2005200620072008 Net Profit (before Tax Interest)$189,555$222,014$241,300$270,548 Over Average Total Assets$919,559$1,097,835$1,324,155$1,508,016 ROA20. 61%20. 22%18. 22%17. 94% Return on assets shows how well the business assets are being employed, to what level they are utilised and to what impact any new assets may be having to overall net profit. These figures show a reducing percentage that may indicate the business is investing in higher risk assets that may not yet be presenting their full return potential or as a safe option within the economic climate are investing in lower risk assets with lower marginal return, alternatively it could represent a business that is not efficiently managing its new assets as it is not making the same return on their assets that they previously were. It could, also, be showing the current economic climate were return on assets are requiring more investment and higher cost to gain similar $ yield. ROE = NP (after taxation preference dividend) / Average Shareholder Equity during period 2005200620072008 Net Profit (after Tax preference dividend if any)$125,232$145,659$167,607$176,269 Over Average Shareholder Equity$607,938$674,729$735,903$777,393 ROE20. 60%21. 59%22. 78%22. 67% Return on Equity or the Return on Shareholders’ Funds shows a ratio that compares profit to the owners with a stake within the business. This ratio shows, that if there were no retained profits they may be able to make the percentage mentioned return on their funds invested in dividends, for example $100 invested in 2005 would see a return of $20. 60, these ratios can help investors decide whether they should invest compared to other investment opportunities. The difference between ROA and ROE is the ROA shows what level of return the business is getting on their funds invested into assets and how efficiently their managers are running these assets, whereas the ROE shows what level of return the investors are getting on heir funds invested into the company. Question 4 – Cash flow statements 2005200620072008 Operating activities$122,317$107,675$91,209$153,207 % Change from previous year83. 62%-11. 97%-15. 29%67. 97% % Change from base year (2004)83. 62%61. 64%36. 92%129. 99% Investing activities($37,453)($145,179)($73,462)($146,867) % Change from previous year54. 01%-287. 63%49. 40%-99. 92% % Change from base ye ar (2004)54. 01%-496. 98%-202. 08%-503. 92% Financing activities($86,883)$51,799$34,314$18,626 % Change from previous year-378. 35%159. 62%-33. 76%-45. 72% % Change from base year (2004)-378. 5%385. 19%288. 92%202. 55% Net cash Cash Equivalents$51,022$67,855$113,212$125,852 % Change from previous year-9. 93%24. 81%40. 06%10. 04% % Change from base year (2004)-9. 93%20. 98%101. 85%124. 39% The above table shows the cash flow within 4 main segments of the business operations and the changes within these levels from year to year. Noticeable changes included: -Operating activities ?Decreases in 2007 from higher income taxes ?Lower marginal increase in receipts from customers ?2005 shows lower (than trend in other years) payments to suppliers and employees ? 006 shows steep increase in payments to suppliers and employees ? 2007 2008 show significantly higher borrowing costs, this can be attributed to the significant increases in borrowings in these years. -Investing activities ?2005 sh ows the business made no purchases of subsidiaries or any net cash acquired. ?2007 shows reduced expense to subsidiaries and net cash acquired ? payments for intangible assets has reduced each year, excluding 2007 ? 2007 seems to be a weaker performance year for this business and this may be a reason to why investment in new subsidiaries reduced in this year. Financing activities ?2005 significantly smaller borrowings (of $87m as apposed to $338m in 2008) – main factor to negative figure. ?Higher repayments in 2005 than 2006. ?The business reduced their borrowings significantly in 2005 compared to later years, this may be an indicator to the business growth and expansion plans. ?The business has steadily increased the dividends paid to shareholders from each year. ?2005 seems to be a consolidation year with the business borrowing less and paying back more. 2007 2008 the business held significantly higher borrowings thus payments had to be higher however not compared to the s ize of their borrowings, EG borrowings of $113m at the end of 2005 with $114m repaid (over 50% repayment) compared to 2008 with $471. 4m borrowings with $197m repayment (closer to 30% repayment)). -Net cash cash equivalents ?Net cash held has increase significantly from 2006 to 2007 ? Net cash has increased to a high amount, perhaps this is required for the businesses day to day activities, however if not, it may be under utilising its cash resources. The business made profit from exchange rate in 2006 but in all other years has seen a loss from the effects of exchange rate, this could be due to the strength or weakness of the Australian dollar (or other currencies held by the global business) and the increased transfer from weak currencies to stronger currencies, EG the Australian dollar has remained relatively strong during the GFC whereas other currencies have seen a harsher effect on the value of their currency and as Billabong is an Australian business one could say that more cash would be transferred in to Australian dollars than would be transferred out. What this tells us about Billabong is there may have been some downfalls in 2007, however the organisation has remained stable and is investing for future growth, and although their growth might have slowed from years prior to 2005 they are still a growing and expanding organisation. Question 5 – Short Term Liquidity Current Ratio = Current Assets / Current liabilities 2005200620072008 Current Assets$340,255$474,008$573,518$667,523 Over Current Liabilities$136,645$180,748$172,273$217,102 Current Ratio2. 9 times2. 62 times3. 33 times3. 07 times The current ratio shows the comparison between the ‘liquid’ assets and current liabilities to find how many times the business can cover the short-term commitments of their current liabilities. The Pearson text (pg 298) states that an ‘ideal’ cover ratio is around 2 times, with this in mind we can see the business is in a stable position to cover their short-term commitments and is increasing its ability to do s o (Atrill, Mclaney, Harvey Jenner, 2009). Also it indicates the business is making wise growth decisions at a minimal cost and is investing their funds well, as the current assets are growing at an increasing rate than that of the current liabilities. Quick Ratio = Current Assets (excluding inventory and prepayments) / Current liabilities 2005200620072008 Current Assets (excluding Inv prepayments)$224,682$301,099$387,872$440,098 Over Current Liabilities$136,645$180,748$172,273$217,102 Quick Ratio1. 64 times1. 67 times2. 25 times2. 03 times The quick ratio (also known as the Acid test ratio) is a more accurate way of determining the liquidity of the business as inventory may not be as easily liquidated if needed. The ratios show that Billabong has covered their liabilities and for potential lenders (or trade payables) demonstrates that if the business was unable to make repayments it would not be hard for them to liquefy some assets to meet these payments without detrimental effects on business assets. Question 6 – Liabilities over assets Interest Cover Ratio 005200620072008 Total Liabilities (TL)$300,604$545,609$630,895$830,358 Total Assets (TA)$937,938$1,257,732$1,390,578$1,625,461 TL / TA32. 05%43. 38%45. 37%51. 08% The trend in this gearing ratio suggests the business in increasing its total liabilities faster than its assets and in the long term presents a bad trend towards over borrowing (almost half of 2008’s total liabilities are made up of borrowings). Perhaps the assets are not presenting their value in relation to the liabilities they may have produced while attaining them. However this percentage is still manageable as long as the trend does not continue for too long. Interest Cover Ratio = Profit / Interest expense 2005200620072008 Net Profit (Before interest and tax)$189,555$222,014$241,300$270,548 Over Interest expense$5,896$9,069$19,486$24,986 Equals Interest Cover Ratio32. 15 times24. 48 times12. 38 times10. 83 times This ratio is used by lenders to see the businesses ability to repay loans interest. Although reducing, an interest cover ratio of 10 times is still a strong ratio. However, if this trend continues at its current rate the business may have too much debt for their net profit to cover the interest expense, the business may find it difficult to make further borrowings and may prevent the business from reaping benefits from future investment opportunities. Question 7 Dividend Yield Price/Earnings Ratio 2005200620072008 Market Value Per share at close 30th June$13. 63$15. 35$17. 95$10. 80 Dividends Declared $64,897$84,858$97,435$112,014 Earnings Per share (cents)60. 970. 580. 785. 1 Number of Ordinary Shares on issue205,271,283205,984,631205,859,969205,753,609 Total value of Shares on issue$2,797,847,587. 29$3,161,864,085. 85$3,695,186,443. 55$2,222,138,977. 20 There is a drop in share issue in 2007, perhaps, due to high market value of shares thus investors would opt to sell shares and make high yield from value their shares in compared to the yield they earn from dividends. The 2007 drop can potentially be accredited to the market anticipating the 2008 drop in share value and selling shares at their high value rather than losing their invested capital when the share prices drop. However this alternatively could be a primary attributing factor to the 2008 drop in share value thus affecting the share price further, as there was reduced market confidence, which can be seen by the businesses originator, Mr. G. S. Merchant, selling off close to a third of his share capital invested in Billabong in 2006, potentially as a precursor to future reduced confidence in the performance of Billabong shares, although this may have just been a way for Mr. Merchant to cash out some of his shares in order to invest into other projects, it is a detractor to overall investor confidence. Dividend Yield Ratio = (Dividends per share / (1-t)) / Market Value per share *100 2005200620072008 Dividends paid per share (cents)31. 6241. 2047. 3354. 44 Tax Rate30% Market Value Per share at close 30th June$13. 63$15. 35$17. 95$10. 80 Dividend Yield Ratio3. 31%3. 83%3. 77%7. 20% The dividend yield ratio is a measurement tool for the investor on the return via dividends from the capital invested. The business strategy of increasing dividend paid may be seen as a strategy to maintain shareholders and stimulate current and potential shareholder confidence during decreasing share value and unstable global financial climate of 2008. Although the yield ratio of 2008 is significantly higher investors need to determine whether the reduced share price is worth the dividend yield and perhaps 2008 shows a period where purchase of shares for the long term would yield higher benefit rather than sale of shares and in hindsight suggest that purchase of shares or hold of current shares in 2007 to 2008 would result in negative change to an investors share portfolio. Price Earnings Ratio = Market value per share / Earnings per share 2005200620072008 Market Value$13. 63$15. 35$17. 95$10. 80 Earnings per share (cents)60. 970. 580. 785. 1 Price Earnings Ratio22. 38 times21. 77 times22. 4 times12. 69 times The Price Earnings Ratio is a practical guide to investor market optimism within the prospective outlook of the business. This Ratio shows how many times the dividend (at the current rate) would need to be paid until the initial outlay of purchasing the shares (at current price) would be covered by the dividends received. The Ratio is reasonably stable from 2005 to 2007, however it shows a sharp decline in 2008, this decline shows a dilapidated share and market confidence because of the dramatic decline in share price and outlines the overall deteriorating market conditions as a result of the global financial climate. This helpful tool allows potential investors the ability to judge the performance of this business in comparison to other investment opportunities and thus define which investment will yield the highest benefit to their investment portfolio. Question 8 – Share Recommendation (Yahoo. com. au, 2009) The above chart shows the 5 year share price of Billabong international and assists in determining the share trends and market confidence. Over past 5 yrsCurrent HighLow Share Price$10. 86$18. 81$6. 09 The first consideration an investor needs to make if they are considering investment is to find a company they have loyalty to, or can justify financially supporting. Secondly they must determine whether the capital invested would yield more than other investment opportunities or more than interest return of investing in a bank. Then they must decided using share analysis if the market is stable or whether the businesses share price is stable or growing enough to allow them to realise continued profit from their investment. Within share analysis there are two primary techniques to determine investment viability, which are Fundamental analysis and Technical analysis. Fundamental analysis is the method of analysing the stock through the use of key ratios, comparing these ratios to industry averages and by understanding the fundamentals of the business holistically. Whereas Technical analysis is a method that defines the investment viability by assessing the stock price, stock history, market confidence and other technical indicators. A brief review of these analysis techniques shows the following: Fundamental analysis: Continued financial growth †¢Proven business stability within unstable financial climate †¢Strong and sustainable financial ratios that suggest a growing and stable business †¢Increasing dividend yield ratio suggests growing profits to be made from long term investments through this dividend yield oDecreased share issue assists with compounding this ratio †¢The growing r evenue suggests that continued increases in dividend yield are maintainable with the growth of the business †¢The return on Equity ratio is relatively stable and perhaps on the incline. This suggests that if overall market confidence was to return to levels prior to the GFC the share price would most likely increase towards its previous heights †¢Return on Assets ratio may suggests the business may not be wisely investing their funds, however it is more likely a sign of the current financial climate and the fact that this ratio has not dropped as harshly as other businesses suggests the business has strategies in place to lessen external effects on profitability of its assets †¢Net profit margin and gross profit margin are relatively stable with some incline to gross profit margin, which demonstrates this business is selling its goods efficiently and thus the business should have a continued ability to distribute dividends and assist in growth of its share value through the growth and development of the business value and market confidence in the business Technical analysis: †¢5 year share price history shows low share price in 2008 thus long term sha re investment, in 2008, would potentially yield high profits on the share value †¢Mid-late February 2009 shows steep price drops to $6. 9 †¢Improving market sentiment due to stabilising financial climate †¢Market has not shown full recovery and some financial skeptics suggest the worst is yet to come, thus this uncertainty should be considered when deciding to invest †¢Share price demonstrates ‘bullish’ trend, that is a trend towards upward share price †¢Short term stock stability suggests better return through long term investment, potential trend towards future increasing share price whereas short term prices may only increase marginally. †¢The above chart suggests a potential bottom and end to previous bearish trends (that is, trends towards lower share value) †¢The end of bearish trends and a move towards more bullish trends shows a growing share price that could potentially produce high long term yield to invested capital With the above in mind my personal share recommendation would be in support of purchasing shares. However recommend this as a long-term investment, that is to invest funds; reap benefits from the growing dividends paid and when the share price has regained its strength to sell and yield further return from the probable trend towards increased share value. References: Atrill, McLaney, Harvey Jenner (2009) – â€Å"Accounting – An introduction†- 4th edition Pearson Education, Australia Yahoo. com. au (viewed 04/09/09) Billabong financial chart over 5 years http://au. finance. yahoo. com/q/bc? s=BBG. AXt=5yl=onz=mq=lc= Note: Figures and information have primarily been sourced from Billabongbiz. com and the financial statements within the website.