Saturday, January 25, 2020

Dangers of Methamphetamine

Dangers of Methamphetamine Mark Dawod The United Nations Office on Drugs and Crime has estimated that five hundred metric tons of amphetamine-type stimulants are produced, coinciding with almost twenty-five million abusers. The US government reported in 2008 that about thirteen million people over the age of twelve has used meth, with over half a million being regular users of the substance. Meth has a market price in the US of thirteen billion dollars, which corroborates with its high street price, ranging from three to four hundred dollars for a fourth of a gram. Although meth is known for its disastrous side effects such as severe damage to the brain and heart, it helps those suffering with ADHD, narcolepsy, and dietary problemy. Overall, methamphetamine is a perilous stimulant that cripples the lives of its users and bystanders. However, with strong public awareness and education regarding the drugs deleterious effects, the dilemma of meth exploitation can be stopped. What is meth? Where did it originate from? Amphetamine, a dialect of the perilous methamphetamine we know today was first synthesized in Germany in 1887, however, scientists were blinded to its stimulant effects at the time. A few years later in 1893, meth was synthesized in Japan, it was not until 1919 that crystal meth was synthesized, similarly in Japan. At the time, the effects of this drug were not fully understood and were not perceived as dangerous, in turn the drug began to gain its popularity, although it did not fully take off until after the second great war. Methamphetamine was given to troops in wars such as World War II, the Korean Wars, and the Vietnam War to help them attain alertness throughout the battles, gaining an advantage over their counterparts. Additionally, methamphetamine was used during Nazi Germany as Hitler was intoxicated and enjoyed indulging in drugs. However, it was not until he sent Nazis thirty-five million pills of meth, known as Pervitin, which gave them the alertness to stay awake and fo cused for days at a time, they believed this pill to be just like coffee. Soon after World War II, biker gangs in California saw the value of this stimulant and began producing and smuggling it, resulting in them making a hefty profit as the drug was easy to produce and sell. To this day, methamphetamine is very well known and used frequently, especially in densely populated regions such as Miami and California. Methamphetamine also has very limited medical use, but is used largely by women seeking to lose weight as the drug suppresses appetite well. Methamphetamine is referred to as crystal, speed, ice, dope, whizz, chalk, and fast, just to name a few. Meth, usually used as a club drug, taken mostly at rave parties, is a poison that systematically destroys the body. I tried it once and BOOM! I was addicted, said a meth addict that lost all that he stood for because of this stimulant. Methamphetamine addiction is single handedly one of the toughest drug addictions to treat and resul ts in death largely because it burns up bodily resources that can only be replenished through frequent consumption of the drug. Who uses meth? And How? Studies show that meth users range from thirteen years old to thirty-three users old, although typically, users are within the fifteen to twenty-two year old age gap. Concerning race, African Americans are less likely to use meth than Caucasians. Meth users are predominantly Caucasian, blue collar workers, unemployed, and studying in either high school or college. Methamphetamine is also largely used in Native American communities because the spread of addiction has been widely spread from Mexican Drug Cartels, which is one of their main access sources for the substance. Women are also more likely to consume meth compared to other stimulants like heroin and cocaine because of its appetite suppressing side effect. Meth can be snorted, smoked, injected, and ingested; statistics concerning the different ways meth is consumed are as follows: 3% injest 12% snort 25% inject 60% smoke How does meth affect the body, mind, relationships, and environment? Upon the consumption of meth, the heart rate of user increases, along with their breathing patterns. Methamphetamine also releases exceedingly high levels of dopamine, 1100% more than cocaine does. This stimulant effect is also one of the main reasons that this substance is very addictive. However, with time, the brain builds a shield to the substance and the only way to get around this is by the consuming the drug more frequently and in higher doses, at this point the user is addicted and builds a reliance on the drug to feed their body resources. Short term, according to drugfreeworld.org, methamphetamine effects include the following: A limited desire for food Heightened heart rate, blood pressure, and body temperature Dilated pupils Disorganized sleeping patterns Nausea Abnormal behavior, possibly violent if permitted Hallucinations and irritability Panic and psychosis Convulsions, seizures, and death Long term, according to drugfreeworld.org, methamphetamine effects include the following: Permanent damage to blood vessels, the brain, and/or the heart Liver, kidney, and/or lung damage If smoked, the carnage of nose tissues If injects, excessive diseases Malnutrition which leads to weight loss Harsh tooth decay Disorientation Increased psychological dependence Psychosis Depression Effects of Alzheimers in the brain Methamphetamine also plays a considerably large role in disturbing relationships between family members and friends. When on meth, the drug basically controls the body, resulting in unintended physical, mental, and emotional harm. The producing of meth within the household or near others is also significantly dangerous to those near by. Through explosions, fumes, or even waste (one pound of meth results in five pounds of waste) which in turn damages the environment. How can we lower the consumption and use of methamphetamine not used medically? According to P.A.C.E representatives, users of methamphetamine have indicated that the drug takes complete control over their body. This is due partially because of the high levels of dopamine that is released through the consumption of the substance. However, if a community is well-educated through a program such as Meth360, methamphetamine use will drop and more awareness will spread through neighboring areas. Conclusion Methamphetamine is a perilous stimulant that cripples the lives of its users and those surrounding them. Although, knowing what it is, its effects, and the dangers of its consumption, along with circulation of such information, the use of this drug will decrease and the environment, along with many families coping through the addiction of a loved one, will improve.

Friday, January 17, 2020

From Man to Boy

Lemons. The author makes his first stand at the very opening of the work with this hard peeled, soft-fleshed visual. The sour fruit, which is cut into by the narrator at the beginning of John R. Coleman’s, essay From Man to Boy, stands as a metaphor for the life circumstances in which he continues to find himself and others. The choice allows for a much shorter opening to the essay by utilizing the well-known allegory of the lemon as an acerbic, broken object or happenstance from which the owner has no means of escape. In the beginning lines Coleman produces the appearance of a setting in which the weight of an entire world the reader does not have to see to believe in, is resting on the shoulders of the narrator. He does this by coupling the lemon with a position of employment that is both low on the wage scale, and limited in skill requirements. Even the waitress, a position most readers will equate with being lesser in station, looks down on the work, therefore the worth, of the narrator. This immediately sets up the main character as a victim of his surroundings and appeals to the reader for compassionate understanding and perhaps even pity. This appeal is sustained by the dialogue between the co-workers when Dana tells Jack â€Å"It’s no use†(LaRocco, 128) trying to change the attitude and belief of the waitress who called him a boy. The writer tells the audience, in the same paragraph, that Dana was working this job even as he, the narrator, was reading the billboards’ insidious warnings. In doing so, the narrator is offering up tangible evidence for the argument of an irredeemable quality of ignorance in the world. The argument of ignorance is juxtaposed against the theme of education. The billboards, a metaphor for society’s spoken standards versus their actual behaviors,  promise the worthy and dedicated student a life free of discrimination, bias, and general condemnation. What the writer declares to be the truth of the matter however, is that reality falls far short of the pledge. Life is a lemon. Education does not prevent the action from happening; the waitress still calls him a boy. What education provided him with was a means to recognize the insult and therefore be injured by it. This injury is noted in the sad look on Dana’s face. The exposure of the treatment of the housekeepers by the students at the college serves to call further attention to the wide spread plight of the working class. At the same time, it presents an argument that educated people are as likely to fall into the pattern of abuse, yet more likely to change their behavior once it is questioned. The narrator seems to convince the students to cease the use of the term â€Å"wombats (128),† however he also makes clear that it does not erase the ramifications of the actions for those who were abused by them. Naming them as â€Å"the cleaning women (129)† continues a convention from the beginning that says much about society by not saying anything at all. Coleman maintains Dana and himself as the only individuals worthy of names, therefore individual identities, in the short piece. Doing this preserves the notion of a singular hero with only nominal support attacking the great beast of society without actually coming forward and declaring himself a hero. Rather than failing to define himself as the hero of the episode, Coleman comes closer to refusing it. This leaves him on the same playing field as his audience, which acts in tandem with his stylistic choices in the text. By using the quick, almost darting  motions of his statements, and the clipped pacing of short paragraphs and a barely over one page essay, he keeps the reader not only involved but in step with the narrative voice. In order to make points with the intended audience of blue collar working class America, Coleman does all he can to avoid triggering the alienation he is so adamantly set out to battle. Simplicity is the key to the peace. Coleman gets in, makes his point in clear, concise terms, and gets out. This appeal to the working class reader for whom this particular piece is written is continued with a lack of satire in the essay. The simple vocabulary, short sentence construction, and lack of word play beyond the lemon all feed into the assembly of a connection between the writer and blue collar America. He never feels the need to address the existence of those high paying white collar positions directly, while they are inferred by the PhD, the collegiate tack of the students, and the billboards with their empty promises. Reference to the Quaker tradition further exposes the intention of the author to connect with a wholesome and righteous way of life. This is the assumed role many hard working laborers aspire to. The association of Godliness with the Quaker traditions works on another metaphorical level with the housekeepers when the saying is considered; Cleanliness is next to Godliness. Throughout the entire essay, Coleman does his best to solidify his roots in this working class in order to achieve a single goal. The final remark returns to the scene of the first crime in the work, a seemingly flippant remark about being a boy who cuts lemons. By returning to this line the narrator takes a stand for all of the young men who  have had to defend their honor as men simply because they were not making money in the right tax bracket. Coleman combines this with an appeal to the student from working class family to be aware of the results of their choices in treating others before the damage is done. Overall, he produces a very effective essay that is driven on the backs of metaphors and unspoken pieces of the puzzle, which are alluded to behind sweeping statements designed to stir the primal instinct of honor and self preservation in the face of societal imposed duress. Work Cited LaRocco, C (Ed.). (1995). The Art Of Work : An Anthology of Workplace Literature. McGraw- Hill.

Thursday, January 9, 2020

Gender, Gender And Gender Roles - 1476 Words

Remember the 50s in America, how men were the predominant head of the household and women were expected to cook, watch their kids, and clean? This is an excellent example of gender roles, and how they control some aspects of life. Gender roles according to multiple sources are, the way people behave, what they do and say, to express being a female or male. (â€Å"Gender Identity†, Blackstone, Gender Spectrum). They are forced upon an individual from the day that person is born even in the most trivial of terms of putting boys in blue clothes and girls in pink. Throughout that person’s life from then on, they will face everyday cultural expectations to act according to their sex. Gender roles can often be confused and hurtful, many stores have moved away from assigning products to a specific gender, but not only can gender roles affect behavior, it plays a huge role in transgenderism. Many people confuse the definition of gender and sex. â€Å"Gender, on the other hand, refers to the meanings, values, and characteristics that people ascribe to different sexes. Sex is a biological concept, determined on the basis of individual s primary sex characteristics.† (Blackstone) Society gives social cues on the appropriate behavior for each sex. For example, women are to exert more feminine traits such as dependent, emotional, passive, innocent, nurturing, and/ or self-critical. On the other hand, men are to behave more masculine such as independent, non-emotional, aggressive, competitive,Show MoreRelatedGender, Gender And Gender Roles1437 Words   |  6 Pages Gender roles play an important role in society whether it is for good or for bad. These roles have been placed in society since the beginning of time. The term gender is socially created and it therefore categorizes men from women. How is gender defined, and what makes it different from the term sex? â€Å"†¦sex refers to the biological characteristics that distinguish women and men: se x chromosomes, reproductive organs, sex-specific hormones, and physical characteristics†¦Gender†¦ refers to the socialRead MoreGender Roles : Gender And Gender1587 Words   |  7 Pagesbetween gender and sex. Sex is anatomical and biological. Gender role can be defined as a person’s inner sense of how a male or female should feel and behave. Culture and society are two important factors in relation to this particular topic. This implies that various societies and cultures may produce children and later fully grown men and women who may have diverse perspectives of a man or a woman’s place or role in the world around them; this is often determined by their culture’s gender stereotypesRead MoreGender, Gender And Gender Roles844 Words   |  4 PagesSociety has institutionalized gender roles since the beginning of time, a common one is that women are the nurturers and housekeepers, while men are the breadwinners of household. In spite of centuries, and fighting for women s rights, such as the right to vote in the late 1920s. Women still have roles to fulfill, even in a modern society that is dominated by a virtual world. Gender identification has multiplied from that of men and women, to Lesbian, Gay, Bisexual, Transgender and Queer (LGBTQ)Read MoreGender, Gender And Gender Roles1110 Words   |  5 Pagesbelieve gender is only based on being male or female. People believe gender is based on the physical and biological differences between women and men. Over the last few years, the term gender has changed. When some people believe gender is being male or female. Most people associate gender with gender roles and how people are supposed to function or perform based on society’s expectations. In other words, people believe males and females have to behave according to their gender or gender roles to beRead MoreGender, Gender And Gender Roles863 Words   |  4 PagesGender can sometimes be seen as biological characteristics h umans have, when in fact it is the social characteristic ones society deems either masculine or feminine. Sex, on the other hand, is the biological differences in humans, for example, hormones and sex organs. People usually play gender roles in society, otherwise known as gender ideology. Gender ideology is when men and women have certain attitudes regarding their ‘fixed’ roles, responsibilities and rights. Throughout history men and womenRead MoreGender, Gender And Gender Roles1225 Words   |  5 Pagesoptions related to gender conduct. Male gender roles are instilled early on in childhood. As men meet these unwritten expectations they acquire acceptance from other men, attain potential mates, increase self-esteem and increase social status. This in part is called the socialization process. These benefits reinforce men to continue with this as their standard. What are these unwritten rules that are nurtured and taught so crucially by family and friends? Traditional g ender roles are what determineRead MoreGender, Gender And Gender Roles Essay1823 Words   |  8 Pagesclearly determined line from both involving parties reveals to us the ancient war of genders. A society which has overcome many social indifferences yet gender roles is a highly controversial and complicated topic. It seems this generation is caught in the crossfire of the final frontier of this ancient war. An increase in fundamental changes in gender roles is resulting in manipulating society and altering gender boundaries; females are breaking out of traditional restraints. As with all changesRead MoreGender, Gender And Gender Roles2086 Words   |  9 PagesGender refers to being male or female. It is usually used to determine the cultural and social difference between men and women. Gender roles are expectations of how males and females should behave, what attitudes they should have, what activities they should do and etc. according to their culture (Witt, 2016). Years ago , males and females had specific roles that separated them from each other. Males were known to go hunting to provide food for the family, and females were to stay at home andRead MoreGender, Gender And Gender Roles1829 Words   |  8 PagesGender socialization often begins early once parents are shown the sex of their child; from then on, baby showers are planned according to gender â€Å"appropriate† colors, which are often pink for girls and blue for boys. Even differences in how children are spoke to can be picked up easily in Western cultures. Girls are called pretty and sweet, whereas boys are handsome and strong. Ultimately, the way children learn to identify with their gender culture is in part due to not only family and friendsRead MoreGender Roles And Gender Role844 Words   |  4 PagesGender Roles can be defined as roles society expects people to play on account of their sex life. Like all roles, gender roles are made up of sets of expectations, so they can be thought of as sets of expirations, so they can be thought of as sets of expectation that are attached to sex.(pp: 220 John E. Farley Michael W. Flota). The key word gender role affects me personally because as recent graduate of high school it’s time for me to go into the real world, of working class gender role of the

Wednesday, January 1, 2020

Overview of henry boot groups performance - Free Essay Example

Sample details Pages: 16 Words: 4784 Downloads: 7 Date added: 2017/06/26 Category Finance Essay Type Argumentative essay Did you like this example? 1 Introduction In this post module work, a detailed analysis of Henry Boot PLC for the financial year 2008 is presented by examining their annual report in detail. The work mainly consists of: The Company description, its various businesses and the market scenario. A Brief overview of Henry Boot Groups performance in the last five years In-depth Financial Statement Analysis which will involve study of Income statement, balance sheet, cash flow statements, notes to accounts, accounting policies, chairmans statement and other management discussions mentioned in the annual report. Conclusion at the end would present a summary of financial performance and comment on the way ahead. The press releases and press commentaries on results have been referred to wherever appropriate. Don’t waste time! Our writers will create an original "Overview of henry boot groups performance" essay for you Create order 2 About the Company Henry Boot Group is a Sheffield-based organisation which is one of UKs leading players in property and construction (Annual Report, page 2). The company was founded in 1886 by Henry Boot whose direct descendant, Jamie Boot, is the current Managing Director. The Boot family owns about 20% of the companys shares, either directly or in trust (https://business.timesonline.co.uk/tol/business/specials/rich_list/article3815317.ece, Sunday Times, Dt.12th Feb 2010). The company transformed from a pure play construction company to a firm with interests in property development, land management, construction and plant hire in the 1990s (https://www.henryboot.co.uk/corporate/history.aspx?s=corporatep=history, Henry Boot PLC, Dt.12th Feb 2010). The group today consists of the following four trading subsidiary companies: The first two companies listed have endured a rough market in 2008 because of falling property rates and decrease in demand. These two companies have had to significantly downgrade the values of their inventory and book losses due to the economic downturn. Construction hasnt suffered as much because of its reliance on centrally funded contracts under initiatives like Decent Homes and Prison Alliance. Plant Hire has seen a drop in demand but is still in the green (Annual Report, page 8). 3 Five Year Analysis Before looking at the financial performance of Henry Boot for the year 2008, it is useful to have a look at its performance over the past five years to provide a background for comparison and analysis. Since the annual report for 2008, didnt have a five year review, the annual reports of the past 5 years have been used to get the financial numbers in this section. 3.1 Revenues and Cost of Sales As can be seen from the graph and table above, the revenue and cost of sales for Henry Boot have seen an upward trend in the past five years except for the year 2007 when both parameters fell. It is interesting to note that the property market in which Henry Boot operates has been seeing problems since 2007. In discussion later in this work, it can be seen that the rise in revenues for 2008 was more on account of profit booking by selling off inventory at the price available than a sign of a genuine sustainable trend. Cost of sales for a property developer and real estate player like Henry Boot consists of the initial cost paid to acquire the property, the money spent to develop it and in constructing structures. Cost of sales for Henry Boot isnt as reliable a measure as it is for say a manufacturing firm, but is still quite indicative of the market conditions. Revenues generated from a property, through sale or rent, reflects two aspects first the inherent quality of the prope rty (which is more or less captured by cost of sales) and second the bullishness in the market. The years 2005 and 2006 were the boom years for the real estate market (https://www.lloydsbankinggroup.com/media/pdfs/research/2010/270110HousePricesin2000s.pdf, Lloyds Banking Group, Dt.12th Feb2010) and so rise in revenues outpaced rise in cost of sales. As normalcy returned in 2008, the cost of sales started to catch up with revenues once again. 3.2 Capital Employed and Profits The Capital employed by a firm is the amount of earning assets that a firm has or the total assets of the firm minus the current liabilities. Operating Profit is the Profit before Interests and taxes i.e. PBIT and is a measure of the operational well being of a firm. As can be seen from the figure, from 2004 to 2007, the operating profits increased as the capital employed increased. But in 2008, even though the capital employed has increased, the operating profit has taken a sharp turn for the worse. The reasons behind this fall in profit will be examined later in this work in detail. 3.3 Total Shareholder Return The total shareholder return includes the gain in share price over the period plus the dividends granted by the company. As can be seen from the chart, the TSR of Henry Boot was much higher than FTSE Small Cap Index during the boom period of 2006-07 but has since fallen and in Dec 2008, the TSR was actually negative. 4 In-Depth Analysis of Financial Statements For gaining an in-depth understanding of the operating and financial performance of Henry Boot Group in the past two years, their Annual Report for the year 2008 was examined. The profitability, operational efficiency, cash management and capital structure for Henry Boot Group have been examined. The prospects of the group from a shareholders point of view have also been analyzed. Apart from the annual report, press releases and commentaries have also been used and are duly referenced. 4.1 Profitability The ultimate objective of any enterprise is to earn profits and ensure that it keeps earning them year after year. To study financial and business performance it is essential to look at how profitable the firm is and what inferences can be drawn for future from the present profit numbers. From the published accounts of Henry Boot for 2008, the profitability of the firm is analyzed below: 4.1.1 Revenues Higher revenues are often the key to higher profits, so first a brief overview of revenues is being presented. Henry Boot witnessed an increase of 55% in the revenues from pound; 124.8 million in 2007 to pound; 193.7 million in 2008 (Annual Report, p58). The segment wise revenues are shown below: All major segments have shown an increase in revenue compared to 2007. Given the adverse economic scenario, Henry Boot has stayed away from making new acquisitions or investing in new developments unless the opportunity is very attractive according to the Operations Review (Annual Report, page8). The increased revenue has come because Henry Boot has completed several large land deals (Annual Report, page 4) which is also evident from the decreased inventories shown in Note 17 (Annual Report, page66). 4.1.2 Gross Profit and Operating Profit With increased revenues, gross profit has also increased 38.5% from pound; 42.4 million in 2007 to pound; 58.7 million in 2008. However the increased gross profits dont get reflected in operating profits which have fallen 56% from pound; 50.4 million in 2007 to pound; 22.1 million in 2008 (Annual Report, page 50). This fall has largely been on because of property, impairments and revaluation account which has gone from a surplus of pound; 18.1 million in 2007 to a deficit of pound; 22.4 million (Annual Report, page 50). As per chairmans report, the deficit in 2008 has been on account of decrease in market value of a number of properties and land held by Henry Boot, most notably, their shopping centre at Ayr (Annual Report, page 4). The graph above shows the segment wise split of profits for Henry Boot. Increased sales in Land development segment have brought higher profits. The construction segment had a strong order book with centrally contracted work in initiatives like Decent Homes and Prison Alliance and so has seen a robust profit growth. Property investment and development has suffered on account of the revaluation deficit of pound; 19.3 million. Group overheads and other report more losses on account of higher share based income and pension expenses. 4.1.3 Profitability Ratios Profit margin or PBIT expressed as a percentage of revenues is one of the most commonly used ratios to measure profitability. It measures the relationship between revenue and overall costs. The greater the ratio, the stronger is the ability to earn profits (Wendy, 2003). As can be seen from the table above, the profit margins have fallen from 40.38% in 2007 to just 11.41% in 2008. This fall again has been due to the revaluation adjustment made during the year 2008. Since revaluation is more of a one-time activity than a regular one, the profit margin is expected to improve as market conditions improve. However, the cost of sales going up from 66% in 2007 to 69.6% of revenues in 2008 can be an indication that the profit margins in near future will fall. Return on Total assets and Return on Capital Employed are ratios that measure how much profit can be earned by a unit investment in the firm. As Henry Boot is in a variety of businesses, it is difficult to compare its returns to t hose of its competitors. In 2008 both ROTA and ROCE have fallen significantly as seen from the table above. As explained earlier, the decrease in PBIT in 2008 is on account of revaluation of property and land and does not reflect any fundamental long term change in the business of Henry Boot. In a cyclic sector like real estate, there are bound to be years when there would be a huge revaluation surplus and other years when there is a huge revaluation deficit. The cyclicity of booms and busts is getting reflected in the ROCE and ROTA numbers. Overall, it can be concluded that the profitability of Henry Boot suffered a big blow in 2008 because of the revaluation and impairment deficit. 4.2 Operational Efficiency For any business to remain competitive over a long run, attention has to be paid to operational effectiveness. Operational effectiveness implies use of the given assets to generate the maximum possible revenues. A firm has two types of assets fixed assets and current assets. How effectively Henry Boot used these assets in 2008 will be seen in the following section: 4.2.1 Net Asset and Fixed Asset Turnovers The table above shows that the Net Asset Turnover for Henry Boot Group has improved significantly to 0.841 in 2008 from 0.545 in the previous year. ROCE is a product of Net Asset Turnover and the Profit Margin. Since Net Asset Turnover has improved, it can be concluded that the fall in ROCE was only due to fall in Profit margin. The improvement in net asset turnover shows that Henry Boot was able to achieve higher sales per pound; of capital employed. The improvement is a result of a strategy shift discussed in the Operations Review (Annual Report, page8) whereby Henry Boot is no longer interested in adding new properties to its portfolio and is keen to sell whenever it can get a fair price. This way revenues increase while the net assets employed remain constant. Fixed Asset Turnover also has increased significantly from 0.502 in 2007 to 0.765 in 2008. Property, Plant and Equipment (PPE) and Investments are the two biggest components of fixed assets (Annual Report, page 51). As most of the developments underway at the beginning of 2008 were completed during the year (Annual Report, page4), a significant amount of assets moved from PPE to Investments. Unlike a pound; stuck in PPE, a pound; in Investments can earn rent or is available for sale and so the revenues have increased because of higher share of investments compared to PPE in the fixed assets. 4.2.2 Debtor Days The debtor days has improved significantly from 84.27 to 51.31 which imply that Henry Boot has started collecting payments from its buyers more than a month earlier than it did last year. However there is no mention of any special effort put towards this end in the Annual Report and so finding out the reasons would require a more careful analysis. Firstly, receivables of pound; 5.344 million which are due after more than a year have been shifted to non-current assets in 2008 (Annual Report, page 64). Secondly in large land deals, like those completed in 2008, payments are generally made upfront. These two factors have resulted in higher revenues with receivables being same and have brought down the debtor days number. 4.2.3 Creditor Days Creditor days for Henry Boot has come down from 244.72 to 140.29 implying that the suppliers are less willing to extend credit to Henry Boot. There has been a transfer of pound; 7.233 million to non-current liabilities. Secondly increased sales in 2008 have been accompanied by decrease in inventory and not by fresh investment in stock. So the payables have remained constant with cost of sales increasing significantly. 4.2.4 Days Inventory The Days Inventory number has also come down from 369.36 in 2007 to less than half i.e. 159.56 in 2008. The reasons for this are two fold sales have happened in 2008 without fresh addition to stock thereby depleting inventory and secondly cost of sales has increased in keeping with revenues. With the numerator falling and denominator rising, a fall in days inventory number is understandable. Overall, it can be concluded that Henry Boots operational efficiency is improving on most parameters and if it can be maintained, it will be very helpful for the group in the hard economic conditions expected in near future. 4.3 Capital Structure The assets that a firm has have to be financed in one way or the other either through equity or by borrowings. The exact mix of equity and borrowings defines the capital structure in use. Let us have a look at how Henry Boots capital structure has changed in the past two years and how robust is its balance sheet to meet its payment obligations: 4.3.1 Loans taken As on 31st December 2008, Henry Boot had pound;45.463 million of loans due within a year compared to pound;55.702 million due within a year on 31st December 2007. The loans due after more than a year have fallen drastically from pound; 17.556 million in 2007 to pound; 6.394 million in 2008 (Annual Report, page 67). Majority of the loans taken are floating rate loans and expose the firm to flow interest rate risk. 4.3.2 Gearing The gearing or leverage is defined as the amount of borrowings or high risk finance the firm has for every pound; of equity or low risk finance (WMG Notes, 2010). Borrowings are high risk finance because of interest rates risk as well as the fact that interest has to be paid even when firm is making losses. Shareholders who provide equity need not be paid any dividends if the firm is short of money. As seen from the table, the Gearing has been brought down to 26.16% in 2008 from 39.28% in 2007. The reduction in gearing indicates a decision to reduce the financial risk involved by getting rid of high risk sources of finance i.e. loans. In the prevailing economic climate, the business risk for Henry Boot Group is pretty high in itself with property values reducing by as much as 15% in a single quarter (Annual Report, page 8). Adding financial risk on top of the business risk will further aggravate the situation. So, Henry Boot Group has wisely chosen to reduce its dependence of loans. 4.3.3 Interest costs Since 2007, the interest rate to be paid on floating rate bank loans or for bank overdrafts has fallen by close to 1%. A 1% change in interest rate would impact PBT by pound; 346,000 (Annual Report, page 67). The interest paid during the year 2008 was pound;3.427 million compared to pound;4.195 million in 2007. The reduction in interest rates occurred because the total borrowings have gone down from pound;73.258 million in 2007 to pound;51.857 million in 2008 (Table 9). The reduction in interest costs is essential for the time being because the current economic situation is believed to prevail for quite some time. In such a situation, Henry Boot has to depend on rental incomes from investments and construction incomes which are not a match for the deal driven profits being made earlier (Annual Report, page 4). Accordingly it is wise to cut the expenses also as much as possible and starting with interest costs isnt a bad idea at all. 4.3.4 Is the firm solvent? To examine whether any firm would be able to honour its payment obligations, it is important to check its interest cover figure. As can be seen from the table the interest cover for Henry Boot has fallen from 12.01 in 2007 to 5.63 in 2008. Though such a steep fall is worrisome, Henry Boot has been reducing its borrowings and the profits for 2008 were especially low because of the revaluation deficit and can be expected to pick up in future. Current Ratio and Acid Test Ratio check the ability of a company to pay its short term obligations from its short term assets. With a current ratio of 0.795 in 2008, Henry Boot will only be able to pay for about 80% of its short term obligations from its short term assets. Overall, it can be concluded that Henry Boot has manageable financial risk (30-40% gearing is normal for firms in UK as per WMG Notes, 2010). The efforts to reduce gearing even further will only help in reducing risk even more. And despite taking a hit in 2008, the group also has enough liquidity to meet its payment obligations as reflected by an interest cover of 5.63. 4.4 Cash Management Though a firm might be making profits, it can still go out of business if it doesnt pay attention to its cash situation. After all, a firm can make losses a number of times but can only run out of cash once (WMG Notes, 2010). The cash management abilities of Henry Boot are being analyzed in this section by examining its Cash Flow Statements: 4.4.1 Cash Flow from Operating Activities The Cash Flow from operating activities for years 2008 and 2007 throw up interesting and contrasting pictures. In 2007, the operating profit was high at pound; 50.381 million but the net cash from operations was only pound; 4.005 million. On the other hand, for 2008 the operating profit was much lower at pound; 22.115 million but the net cash from operations was pound; 57.234 million (Annual Report, page 53). This is because in 2007, there was a revaluation surplus which increases profit without increasing cash flow. Also in 2007, the inventories increased which means that additional cash was tied up but profits remained the same. In complete contrast to this, in 2008, there was a revaluation deficit which decreases profits but has no effect on cash. Also the inventories fell in 2008 which means that cash was freed up. 4.4.2 Cash Flow from Investing Activities The cash out flow from investing activities is much lower at pound;27.614 million in 2008 than the outflow of pound;51.800 million in 2007. This decrease in investing outflow is primarily because the purchase of property, plant and equipment has gone down from pound;58.275 million in 2007 to pound;38.687 million in 2008. Apart from this the cash inflow from disposal of investment properties is pound;5.729 million in 2008 compared to just pound;0.739 million in 2007. 4.4.3 Cash Flow from Financing Activities The cash outflow due to financing activities in 2008 is almost the same as that in 2007. Overall, the cash and cash equivalents witnessed an increase of pound;21.654 million in 2008 compared to a decrease of pound;55.034 million in 2007. This is because in 2007, a lot of property and land blocks seemed attractive for investment and Henry Boot built up inventories anticipating gains in future. But the economic climate in 2008 has forced Henry Boot to adopt a defensive strategy whereby they are trying to dispose off inventory if offered a reasonable price and are not too keen on adding more to their stock (Annual Report, page 5). 4.5 What Henry Boot should mean to a Shareholder? Henry Boot PLC saw its Earnings per share decline from 24.5p per share in 2007 to 10.8p per share in 2008. Aside from the information available in the table, Henry Boot PLC has underperformed every comparative index by giving a Total Shareholder Return of 62% in 2008 compared to -42% on FTSE Construction Sector, -47% on FTSE Real Estate and -44% on the FTSE Small Cap index (Annual Report, page 5). As can be seen from the table, the return to shareholders also has fallen from 17.40% to 7.35%. Dividends though, have been maintained at 5.0p a share. Overall, Henry Boot in 2008 doesnt sound too attractive for the shareholder in the short run. But one must also understand that Henry Boot has a strong order book in Construction, the road link A69 will keep bringing in recurring income and also the defensive strategy with respect to property development and land development will give its benefits sooner rather than later (Annual Report, page 5). According to IPD, the annual decline in commercial property has been 26.3% but Henry Boot has only taken a 12.6% revaluation deficit (Annual Report, page8). Another important factor in favour of Henry Boot is that despite taking a big hit in 2008, its NAV per share has increased by 5% to 146p. Recurring income from property rentals, A69 and construction sector coupled with a rise in NAV, makes me believe that Henry Boot still has something to offer to a shareholder in the long run. 5 Conclusion Henry Boot PLC had a rough year like everyone else in 2008. Though the group is focussed mainly on the real estate sector which is going to be under strain in the foreseeable future, Henry Group also has alternate businesses that can keep bringing in income even when the market is bad. Rental income from property investments, centrally contracts for construction segments and PFI will keep the cash registers ringing till the situation improves and real estate market starts picking up again. The real challenge for Henry Boot will come if the crisis continues longer and it has to take tough decisions about reorganizing its business around construction once again, the way it had started way back in 1886. 6 Management Accounting 6.1 Part A: Significance of Working Capital Management The need for Working Capital Management arises because of mismatch in the timings of sales receipts and the expenditure incurred to earn it. Working capital forms the lifeblood of any firm as it is used to pay for day to day expenses and bills. If a firm can extract a significant portion of its receipts earlier than it has to make payments, it will end up having a cash surplus. A firm with cash surplus has to invest surplus wisely balancing the return it wants to earn with the risk it is willing to take. If a firm has to pay up earlier than it starts receiving, it will run a cash deficit. A firm with a cash deficit has to raise money to stay afloat. Money can be raised by borrowing from banks, selling property or raising fresh equity. Effective working capital management involves choosing the best way to address cash deficit situation. After all, a firm can make losses many times but it can run out of cash only once. (WMG Notes, 2010) As commercial manager in my group, I had to keep in mind my responsibility towards working capital management whenever I made any decision about spending on Engineering and Quality or bidding for contracts. I had to make sure that even though my job required me to bid aggressively to get more orders, I wasnt overstretching the finances of the firm while doing so. The payments from sales contract will only come once the delivery was made 6 quarters later but the expenses on production and those on engineering and quality had to happen before hand. Though financing this deficit is the finance managers job, I also had to make sure that the consequences of my decisions are not only profitable in the long run but also that the team can survive in the short run. For example, in Year 1, I got an order for 8 units of Terrier for the American market which required production cost of pound; 16 million. To finance this, the firm took a loan of pound; 10 million in Year 1. Similarly in year 2 and year 3, team took loans of pound; 10 mill ion and pound; 60 million respectively. My decisions to spend on developing market for Tigers resulted in the team getting orders for the same and so it had to take loans to buy special machinery. Since loans were available at an interest of 10% whereas contribution was nearly 60% of sales value, it wasnt much difficult for the team to manage the short term cash deficits. In a real world situation, the commercial manager has to deal with such issues in much more depth. For example, he has to negotiate the exact terms of payment to be received from buyers, offer discounts to those who pay early and make provisions for payments received in different currencies. Also in real world, there are various types of loans available short term, medium term, long term, at different interest rates. Knowing exact requirements can lead to more efficient usage of loans. So, a commercial manager would also have to draw up sales plans, expected schedule of cash receipts and other projections for t he coming periods so that finance manager can plan the raising of funds more effectively. 6.2 Part B 6.2.1 Absorption Costing Absorption costing is a technique used to trace the overhead cost to the product being produced. The material and labour costs are directly attributed to the product but it is more difficult to determine how much of the overhead costs should be absorbed by a particular product when there are multiple products being produced. The aim of absorption costing is to find out the complete product cost which will help decide the firm which of the products is the most profitable to produce and what price should it offer to its customers. In the context of Winning Margin, it is possible to allocate some of the overhead costs directly to the product. This is because one machine was producing only one product. So the depreciation costs, the annual maintenance cost and the set up costs can be directly attributed to the product. Such a costing technique gives a much clearer picture about the profitability of a product than that given by contribution margin. For example, in Winning Margin, my team bought a Mark III machine for producing Tigers. A Mark III machine produces a unit of Tiger in one period. The depreciation cost for a Mark III machine is $0.5 million per period [$12-$4 i.e. $8 million to be depreciated over 4 years or $2 million each year or $0.5 million each period]. The maintenance cost for Mark III machine is $0.75 million per period since the annual maintenance cost is $3 million. So, this additional cost of $1.25 million (i.e. 0.5+0.75) should be absorbed by a unit of Tiger because it was the only product the machine was used for. Absorption costing cannot give the complete cost picture because it doesnt deal with absorption of non-production overheads like expenditure on market development or research and development costs. 6.2.2 Investment Appraisal In todays competitive and fast changing environment, a business continuously needs to change in order to survive. This change often entails investment in a new research, technology, machines or marketing campaign. Investment appraisal is the decision making process where any investment proposal is evaluated based on the potential costs involved and the potential benefits it might bring in future. Understanding the expected cash flow pattern, evaluating the return against the companys required rate of return and understanding uncertainties involved are the steps involved in investment appraisal (WMG Notes, 2010). In Winning Margin game, the investment appraisal process was used to evaluate the decision of buying a Mark III machine. Since the demand for Tigers was increasing, the team had decided to concentrate on the market for tigers. First step of investment appraisal was to check whether the Mark III machine being bought fitted into this strategy of the team. Next, we had to u nderstand the risk and return involved. A Mark III machine was capable of faster production but it would only be helpful if there were sufficient orders. Now the risk was that if the team failed to get enough orders, the investment as well as the annual fixed costs for the Mark III would be wasted. After that we had to calculate how long the payback period would be, will the machine be able to pay for itself in 2 years or 3 or 4. The team was confident of getting enough orders and also needed to produce fast, so investing in Mark III seemed the right choice. 7 References Annual Report 2008 Henry Boot About Jamie Boot and family, The Sunday Times 27th April 2008, https://business.timesonline.co.uk/tol/business/specials/rich_list/article3815317.ece, accessed on Feb12th, 2010 Henry Boot Groups Corporate History, https://www.henryboot.co.uk/corporate/history.aspx?s=corporatep=history, accessed on Feb12th, 2010 UK house prices doubled during 2000s, Lloyds banking groups research, https://www.lloydsbankinggroup.com/media/pdfs/research/2010/270110HousePricesin2000s.pdf, accessed on Feb12th, 2010 WMG FACS Notes (2010) Wendy McKenzie (2003), The Financial Times guide to using and interpreting company accounts, 3rd Edition, London: Financial Times Prentice Hall