Women Should Women Be Ever Equal - 1968 Words

Venecia Middlebrooks Julie Dorris Comp.II July 28, 2016 Will Women Be Ever Equal to Men In today’s society it is a shame that women are still not respected and treaty fairly and equally as men in the workplace and society. A lot of men and even some women are stuck in the 1950’s mentally that women are better than men, and should not be treated with the same respect as women. Why does it have to be a man’s jobs and a woman’s job; why can it just me a person’s job. Women are capable of doing just as much work as a main and maybe more. It is not fair that women get paid less than a man when they both do the same job. Men have always been considered the strong dominant gender, and women are the weak needed to be saved and protected by their men. Women are expected to stay home and take care of the children and let the man be the bread winner and run the household. Women have been fighting for equal rights and equal pay for the last 100 years. In the United States women make about seventy six cent for every dollar a man makes for doing the same job. â€Å"That’s up from about sixty three cents three decades ago. The fact is the gap has closed so little in the last 30 years that, at this rate, we’ll catch up in a century† says Betty Spence, President of the National Association for Female Executives it’s really disheartening. ( McAlevy. L 12). Equal pay is a family issue. â€Å"Women make up nearly half of the U.S. labor force and are a growing number of breadwinners in theirShow MoreRelatedEssay on Gender Inequality Still Exists in Modern Society677 Words   |  3 PagesThe search for equality between men and women is fuelling a never ending war between genders. There are still doubts that women are not equal to men; even though people try to convince themselves otherwise, we are faced with day to day situations that prove that women are not equal to men. For example: working in a men’s environment, doing as you please with your sexuality and segregation by nature. Though most men have full respect for women, there is still a lot of conflict in the male perceptionRead MoreFeminism : A Feminist Movement1553 Words   |  7 PagesAlthough it is now 2015, women still must put up a fight for equality. Males and females are constantly being compared in society. Especially at work, whether it is by earning less, or bei ng subjected to an unfavorable environment, women are still seen as inferior to men, even if it is not directly portrayed. This is a problem that has been ongoing since time began, movements for women to gain equality have been occurring for nearly two centuries. However, the goals set by women like, Mary WollstonecraftRead MoreWomens Unequal Pay1333 Words   |  5 Pagesequality in the Declaration of Independence states that, â€Å"all men are created equal.† According to this constitution that we live in correlation with, it suggest and says that we are the same, no one is greater than anyone, whether it be a woman or man. In response to the statement, why should women be paid less than men? Woman should and deserve the right be paid equally for the same jobs they possess in comparison to men. Women have always been seen inferior to men, and in a result has impacted usRead MoreInjustices Of Women And Women1121 Words   |  5 PagesInjustices towards Women (Analysis of sources of unequal treatment to women) Injustices of women go way back to hundreds of years ago. When you learn about women from a long time ago, you hear things like: women didn’t work, women couldn’t vote, women did what they were told, etc.; that was just how it was and very few questioned it. It wasn’t until a movement started back in the 1800’s, known as the women’s suffrage, that the female population started to fight and rebel for equal rights. This startedRead MoreWomen s Rights For Equal Rights1317 Words   |  6 PagesAt this time period racism and discrimination was going on, women were fighting for equal rights. However African American women had to fight double because of racism. Sojourner Truth was the most famous of the 19th Century black women orators, she was born into slavery, she fought for equal rights for men and women. Her speech â€Å"Ar’nt I a Woman† was written by others, after 25 years she had spoken.The people that wrote her speech had problems agreeing with what and how she said things on her speechRead MoreThe Solitude Of Self By Elizabeth Cady Stanton1206 Words   |  5 Pagesequality in every situation, including education and suffrage. Stanton clearly was opposed to the idea of inequality and believed that every person, man or woman, deserved to have the same rights. Elizabeth began her speech with the idea that women are equal to men in every aspect, and in being so, they deserve the same rights. She focuses on four key points: â€Å"her rights under such circumstances are to use all her faculties for her own safety and happiness,† â€Å"since she is considered a citizen sheRead MoreGender And Gender Within The American Workforce1306 Words   |  6 Pagesforefront of America for many years. Whether it is equality for races, religion, gender or sexual orientation, people just desire for life to be equal and fair. Although much has changed and is continuously changing, women still struggle to be seen as equivalent to men in the American workforce. Bound by a wage gap that is bias towards the female species, women have to battle different factors which lead to inequivalent compensation. There are wage gaps stimulating from gender within the American workforceRead MoreAn Essay on A Vindication of the Rights of Woman878 Words   |  4 Pag esWoman I have concluded that the situations of women, as far as rights are concerned, have indeed improved vastly. However, even though their situation has been amended and they are now afforded the same equal rights as men, not all women take advantage of these rights. A fraction of women still care more about their own physical beauty, appearance, and the prospect of finding a husband than anything else. Furthermore even, some of the more juvenile women will even occasionally go so far as to playRead MoreEssay Seneca Falls937 Words   |  4 PagesSeneca Falls In the early 1800s, many of the women in the United States were plain and simple getting fed up with their lack of writes. Men had dominated everything in the past and they were still continuing to do so. Women were finally ready to come forward and voice their opinions about how men and women are created equal. It was now time for women to go out and become what ever they want to be and not have to worry about the fact that they are females. The Seneca Falls Convention wouldRead MoreHow Women Should Break the Glass Ceiling That Exists Nowadays?1175 Words   |  5 PagesSocial Stratification: How women should break the glass ceiling? The glass ceiling starts to form itself very early on. Glass ceiling is one of the most compelling metaphors used for analyzing inequality between men and women in the workplace. Appelbaum Chambliss (1997 : 232) describe the term ‘’glass ceiling’’ as a seemingly invisible barrier to movement into the very top positions at all levels of employment in business and government, which makes it difficult for women to reach the top of their

Rhetorical Analysis Of Marvell s Bermudas - 996 Words

The 17th Century marked an Age of Discovery for both new sea routes and new ways of expressing erotic lust. The Anglican Church of England continued to be the powerholder over England, enforcing the dominant religion and the jurisdiction over those who opposed it. However, after the English Civil War the Church’s power began to fluctuate and other religions including Christianity were gaining religious and civil rights. Embracing steps towards religious recognition Marvell’s ‘Bermudas’ takes the idea of faith to a sensual level, using metaphors to uncover a promised Eden and erotic lust. Marvell’s approach to lust through religion is unimaginable, how is he able to mask his love for women through his faith in God? He embraces New World language to explore faith in God and lust for his promised land. In order to understand Marvell’s use of lust in a religious way I will uncover how his New World language expresses love in Religious Persecutio n, Faith and an eagerness for Virgin territory. Overcome with religious restriction and persecution, Christian sailors were eager to escape England and meet the Eden they are promised in the Bible. Living in a world of restrictions creates a sense of desperation for the unknown. Marvell expresses this in the way he metaphorically relates to water. In order to escape the â€Å"prelate’s rage† sailors must pass through waters that are a â€Å"watery maze† full of â€Å"huge sea-monsters. Marvell encompasses the 17th century view of the world: flat and

Resumen Future of Management Free Essays

UNIVERSIDAD DEL PACIFICO TRABAJO FINAL DE GERENCIA ALUMNO: FREDDY ALEMAN QUIROZ TEMA: OPINION SOBRE â€Å"THE FUTURE OF MANAGEMENT† EL FUTURO DE LA GESTION Desde hace varios anos existe gran demanda de los libros sobre administracion, liderazgo, innovacion, etc. es decir de los libros sobre negocios, todos ellos reflejan un gran optimismo y te dicen como llegar al exito, los best seller sobre este tema siempre tratan sobre experiencias de empresas exitosas bajo la idea de que cualquiera puede lograrlo, pero todos son generales despues de la batalla y escriben libros para contar sus hazanas( su modelo de negocio) en el que cada uno nos cuenta su experiencia, pero definitivamente nunca nos cuentan todo. Gary Hamel es uno de esos escritores que han llamado la atencion desde hace anos, (graduado de la Universidad de Andrews y la Roos School of Business de la Universidad de Michigan, es el fundador de Strategos, una empresa internacional de consultoria de gestion), es uno de los mas exitosos escritores sobre negocios. We will write a custom essay sample on Resumen Future of Management or any similar topic only for you Order Now Es asi que en la Maestria en Administracion de la Universidad del Pacifico, en el afan de introducirnos dentro de las mas actuales tendencias sobre administracion llega a nuestras mentes la ultima publicacion de este â€Å"guru de la estrategia en el mundo†(The Economist), †el innovador sin par de la gerencia en el mundo†(Fortune) con su libro â€Å"The Future of Management†, en el cual nos explica en su primera parte que parece que la administracion como ciencia ha alcanzado su maximo desarrollo y que a lo largo de estos anos ya hemos dominado, en cierta forma, la ciencia de organizar personas, asignar recursos, establecer y definir planes y objetivos, minimizar los errores de procedimientos y que la administracion posiblemente ya haya resuelto sus problemas mas dificiles, y es por eso que se pregunta cual es el futuro de esta ciencia, dice que ha habido poca innovacion en la administracion y la direccion de empresas en los ultimos 20 o 30 anos. Pero Hamel nos dice que esto no es cierto y que a pesar de sus indiscutibles logros hasta ahora, tales como superar complicados problemas triunfando en dividir tareas complejas en pequenos y repetitivos pasos, en que se cumplan y se hagan procesos operativos estandarizados, en medir costos y beneficios hasta el ultimo sol, en coordinar los esfuerzos de miles de trabajadores y en sincronizar operaciones a escala global. Sin embargo hace tambien que las personas se ajusten a las reglas desperdiciando grandes cantidades de imaginacion e iniciativa humana, es por eso que la administracion moderna nos ha legado una serie de dificiles preguntas, que complican disyuntivas que necesitan de un pensamiento muy audaz y nuevos enfoques porque ahora tenemos nuevos problemas, dificultades y dilemas que ponen en evidencia los limites de nuestros actuales y desgastados sistemas y procesos administrativos, y que si bien a originado la multiplicacion del poder adquisitivo de los consumidores de todo el mundo, al mismo tiempo a esclavizado a millones en empresas casi feudales; ha ayudado a que los negocios sean mas eficientes, pero pone en peligro la adaptacion organizacional. Entonces, mientras en la practica la administracion no esta evolucionando a la velocidad que una vez lo hizo, el futuro de los negocios en el siglo XXI no puede ser mas volatil, por eso Hamel nos muestra una cantidad de nuevos retos administrat ivos: †¢ En el entorno cambiante en que vivimos el liderazgo del mercado cambia constantemente de manos y las ventajas competitivas se reducen mas rapido que antes. Las desregulacion, junto con los efectos de la nueva tecnologia estan reduciendo dramaticamente las barreras de entrada en muchas industrias, lo que origina que los oligopolios se esten rompiendo y que la competencia esta incrementandose anarquicamente. †¢ El Internet esta pasando el poder de negociacion de productores a consumidores, antes las companias se aprovechaban de la lealtad de los clientes y les vendian casi cualquier cosa, hoy en dia los clientes saben exigir calidad y no hay espacio para productos o servicios mediocres. †¢ Los ciclos de vida de las estrategias se estan reduciendo. †¢ La baja de los costos de comunicacion y globalizacion estan abriendo competidores con costos ultra-bajos. Ante estos nuevos retos se necesitan nuevas capacidades organizacionales y administrativas, por eso las companias deben adaptarse mas rapidamente en sus estrategias y ser igual de eficientes, tienen que volverse pioneros de las innovaciones y deben saber como inspirar a sus trabajadores para que den lo mejor de si mismos todos los dias. Pero esto no es nada facil, estamos metidos en nuestro paradigma administrativo, el cual esta centrado en la eficiencia y en la burocracia (Taylor y Weber) que es el principio organizativo de casi todas las empresas del mundo. Por eso es necesaria una completa revolucion, hay que pensar hacia delante, hay que imaginar primero y despues inventar el futuro de la administracion. La segunda parte del libro nos dice que debemos reinventar la administracion mediante la innovacion administrativa que es la que nos va a dar poder para crear cambios dramaticos y duraderos y sobretodo producira beneficios. Pero ? Que es la innovacion administrativa? Es â€Å"cualquier cosa que substancialmente cambia la manera en la que el trabajo de administrar es llevado, y que modifica significativamente las formas habituales de la administracion adelantando las metas organizacionales† Pero lo explica de varias formas: â€Å"las innovaciones administrativas tambien comprenden cambios que crean valor para las estructuras organizacionales y para los papeles que desempenan las personas† como ejemplo podemos decir que las empresas consisten de unidades de negocios, departamentos, trabajadores, proveedores, socios y consumidores, por lo tanto una nueva forma de conectar todo esto puede constituir una innovacion administrativa. Ojo que es diferente a una innovacion operacional que se concentra en los procedimientos de negocio de una compania (compras, marketing, servicio al cliente, etc. ), las innovaciones administrativas se enfocan en los procesos administrativos de una empresa, es decir las formas y rutinas que determinan como el t rabajo administrativo es hecho dia a dia. Asimismo nos muestra como empresas lideres como General Electric, Procter Gamble, y Toyota, alcanzaron el exito no solamente gracias a buenos productos, ejecucion disciplinada y buena vision, sino que fue la innovacion administrativa la que los llevo a la grandeza: †¢ General Electric uso la disciplina administrativa en el descubrimiento cientifico, es decir, organizo sus laboratorios y GE fue la que gano mas patentes que cualquier compania en la primera mitad del siglo XX . †¢ Procter Gamble en la decada de los 30s creo las marcas haciendo la novedad de crear valor de los activos intangibles. A partir de alli PG a crecido en base a la creacion y administracion de grandes marcas. †¢ Toyota es el fabricante de automoviles mas rentable del mundo y gran parte de su exito se baso en su sistema â€Å"de gente pensante† para olucionar problemas complejos por ideas de mejoras de empleados ordinarios. Siendo entonces la innovacion administrativa tan importante ? como exactamente estas crean ventajas competitivas? , La respuesta es que las innovaciones administrativas tienden a dar ventajas competitivas cuando se satisfacen una o mas de estas tres condiciones: †¢ La innovacion esta basada en un principio de administracion nuevo que reta a uno que esta desde antes. †¢ La innovacion es sistemica, abarcando un rango de procesos y metodos. †¢ La innovacion es parte de un programa de invencion, que existe actualmente y en el que el progreso se acumula alo largo del tiempo. Las innovaciones pueden ser de diferentes maneras: (en orden de importancia de arriba hacia abajo, en base a los niveles de creacion de valor): †¢ Innovacion Administrativa †¢ Innovacion estrategica †¢ Innovacion en el producto o servicio †¢ Innovacion operativa Ahora, hay que hacer la salvedad de que no toda innovacion administrativa crea una ventaja competitiva, ademas ningun descubrimiento administrativo significativo, no importa que tan audaz o bien ejecutado este, va a darnos ventajas competitivas para siempre, es por todo esto que los gerentes son muy escepticos respecto a las innovaciones ya que son, en su mayoria personas pragmaticas, que no imaginan y que se quedan realizando una y otra vez lo que dice la teoria. Despues de todo lo dicho, Hamel nos muestra un modelo de programa de accion para la Innovacion Administrativa. , basandose en una serie de preguntas que pueden ser utiles para identificar primero la necesidad de una innovacion ( se plantean problemas principales y sugiere solucionarlos con el metodo de Descartes) y luego plantea los siguientes retos respecto a la administracion del futuro: †¢ Acelerar dramaticamente el paso de la renovacion estrategica en organizaciones grandes y pequenas †¢ Hacer de la innovacion un trabajo de todos, todos los dias. †¢ Crear un ambiente laborar altamente atractivo que inspire a los empleados para que den lo mejor de si. Reitero que esto es muy dificil de lograr, pero hacerlo sera grandioso ademas, si tal como hemos visto que las empresas lideres han logrado progresar y tener beneficios de una y muchas innovaciones administrativas, sera mediante la constante innovacion que seguiran en el mercado. Es en esta parte en que Gary Hamel despues de darnos todo su punto de vista, dice que el objeto de este libro no es determinar el futuro de la administracion y la direccion de empresas, sino a ayudar a los lectores que lo inventen, por lo tanto nos deja una tarea muy grande, pero a medida que la hagamos obtendremos el exito y beneficios para nuestras empresas. FREDDY ALEMAN QUIROZ How to cite Resumen Future of Management, Essays

Leading and Managing Organizational Change Australian Rugby Team

Question: Discuss about the Leading and Managing Organizational Change. Answer: Introduction The Australian national rugby union team, the Wallabies are among the finest rugby teams in the world and are ranked third in the world. The Australian rugby team has firmly established rivalries with France and England (Wallabies, 2017). The paper offers a weekly journal on the learning experiences related to the HRM practices of Wallabies as a sports organization. The weekly reflections will help evaluate the current management practices and their role in improving the organizational behavior. I was appointed as a Promotion Director for the Australian rugby team, and my responsibility was to make the team more popular with the help of special events and team promotions. I had to coordinate with the business manager and the marketing director and other members of the sports management. Sport is a special commercial venture where the sportsmen are the product as well as the service providers. The organization is very different from other organizations, and one needs to set up effecti ve ways of integrating proper organizational behavior within the Rugby sports organization. I took about a week to settle down and get familiar with the team and its management practices. A meeting was held last week to discuss the ensuing challenges and increasing number of difficulties faced by the Rugby team. The sports team was unable to attract and retain good coaches, volunteers, sportsman and administrators within the organization. The conclusion of the meeting was that the fundamental governance structure and the organizational behavior need to be looked into. The sports management team felt that it was not just enough to hire right people but also keep in mind the business goals and objectives. Strategic HRM practices were discussed which can take care of rewards and incentives. The focus should be on developing effective culture and strong interpersonal relationships that can handle conflicts, disputes, and grievances. After being in the Australian rugby sports management team, I understood that Sports organizations are a bit more complicated and it is challenging. I think that it is important to look into individual behaviors and perceptions of each and everyone involved. I felt that it would indeed be challenging to bring positive outcomes and enhance organizational effectiveness. The sports club was facing difficulties because of the higher commercial focus and was struggling to meet the costs. Many of the rugby players were moving to other countries lured by higher wages and better job satisfaction. This is certainly not good news for the Australian rugby. The sports management team will have to battle with the external pressures by developing mutual satisfaction between the players, coaches, the governing bodies, etc. (Taylor and Francis, 2013). A meeting was held by the sports management team to review the current status of the team and discuss the challenges. The main issues were the scarci ty of funds and lower level of satisfaction among the players and coaches. It was decided to make two different teams; one would focus on raising funds awhile others would build the morale of the rugby players and coaches. Each team member was to focus on the goals and work together. I was made the leader of the team responsible for building funds as I was also the Promotion Director for the Australian rugby team. The other team leader was assigned the role of taking care of the training, evaluating and rewarding of the rugby team and its performance. Their objective was to raise the level of satisfaction among the team members with better communication, and conflict resolution. However, I had to coordinate with the team leader of the other group. I was thinking about how to lead my team towards a new way of working together and make positive changes within the sports organization. As a team leader and the Promotion Director, I held a meeting with my team members last week and brainstormed different ideas on how to raise funds for the Rugby team and make it even more popular. I believe in the style of transformational leadership to bring about meaningful changes in my team members and the organization. I encouraged everyone to get involved and motivated them to rank the issues faced by the rugby team and develop an action plan to raise funds. Based on the discussion, our team decides on selling merchandise, getting sponsorship and hosting Exhibition matches with the local teams to raise funds and popularity of the team. I had a meeting with the other team leader, and after discussions, we came to the conclusion that a proper organizational behavior needs to be integrated into the team if it has to perform successfully and make more wins. Even if a single rugby player is not doing his job correctly or the sports coach is not performing to his optimum capacity, t he impacts can be seen immediately in the performance of the whole team. Our team began working on additional merchandise such as beer glasses, car stickers, mugs, ties, and T-shirts. The merchandised was first sold within the club as players are often self-motivated purchase merchandise and feel a part of the team. The merchandises make for a convenient gift for all people associated with the club and are an effective way of advertising the club and its players. Exhibition matches were organized between the team and the local schools and clubs for free. Sponsorships were looked for to boost commercial advantage. During my meet with the other team leader, we agreed upon that it is essential to building strong interpersonal relationships to handle any grievances, stress, and conflicts among the team players and the coach. The team members of the other group organize one-on-one meeting to unravel the attitudes of individuals in the organization. The coaches and the players were asked how they felt about their work environment, their commitment to the Rugby organization and their pay. It is essential to note here that individual performance of a player plays a major role in strengthening the foundation of rugby team performance, and hence it should never be ignored. Thus, it was suggested to use performance appraisals every month. Two types of performance appraisals were used, the administrative appraisals and developmental appraisal. Administrative appraisals focused on the salary, bonuses, promotions and training programs for the players, while the developmental appraisal should be customized according to the needs and experience of each player. It was time-consuming to plan and organize merchandised items. Finally, additional merchandise with the Rugby team logo and the players names and pictures was ready. A professional team was hired to design colorful designs and logos. It took about a week to get mugs, ties and T-shirts printed and organized the sale. Pos ters and invitations were designed to send an invitation for exhibition matches to local clubs and school. The Proper schedule was managed so that there is at least one exhibition match every week. A team was organized to take care of sponsorships. I got together with the other team leader to print out performance appraisal forms for each player and a different one for the coach to assess their performance and satisfaction level within the sports organization. Everyone in the team worked hard and is now ready to go ahead with the plans. We ensured that there was effective communication between all team members at all times. Stadium operators and local teams were contacted with detailed plans for venue and ticketing plans to host exhibition matches. Merchandise items carrying the name and logos of the team were gifted and sold to raise awareness and popularity of the sport. Performance appraisal forms were handed out to all the team members. Sponsorship was followed to build the busi ness relationship and get essential funding for the sports club. I realized over the weeks that how important is the teamwork behind the success of every organization. A strong teamwork is essential to understand the challenges and prevent any conflicts that can act as a hindrance. The conflict did arise among the team taking care of merchandised items and their sale. I intervened when necessary and made sure each and everyone was treated with respect. I gave encouraging opinions to the team members to reduce any conflict. I made sure that everyone felt warm in the working climate. After all, running the rugby team and club requires a strong physical and mental connection. It was indeed a great learning experience to go through the planning and organizing the teamwork. I learned the important role and responsibility of a leader to accomplish complex tasks. As asserted by Tsai (2011), it is essential to understand the culture within an organization and maintain a healthy environment with adequate communication and promote the organizational philosophy with the interaction between the leadership and team members. Different teams have different challenges and risks, and the team effectiveness can be worked on with effective communication and timely dissolution of conflicts. I would use the new knowledge and experience in future projects. References Tsai, Y. (2011). Relationship between Organizational Culture, Leadership Behavior and Job Satisfaction. BMC Health Services Research, 11, 98. https://doi.org/10.1186/1472-6963-11-98 Wallabies. (2017). The Roar - Your Sports Opinion Retrieved from https://www.theroar.com.au/rugby-union/wallabies/

Wuthering Heights Heathcliff Personality Essay free essay sample

Personality Heathcliff is one of the main characters in the renowned novel, Wuthering Heights, by Emily Bronte. Heathcliff is such a memorable character due to his unique personality and how he approaches and engages conflicts in his life. Whether Heathcliff’s actions spark sympathy or lead to disappointment with his conduct, some characteristics of his personality do seem to stand out throughout the novel. Traits such as his unwillingness to forgive those for events in the past, his selfish nature, or even the deep emotion that emerges through this seemingly dark figure. In the novel Heathcliff is betrayed by those around him. He is forced to do servant duties by Hindley, who he lives with for many years. As if this is not degrading enough, he begins to lose the love of his life, Catherine, because Heathcliff can no longer provide her with the luxurious life to which she is accustomed. We will write a custom essay sample on Wuthering Heights Heathcliff Personality Essay or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page This betrayal probably is what caused him to develop his unforgiving nature, especially since it causes dramatic alterations to his lifestyle, cripples his chances for a successful future, and leaves him emotionally distraught. In chapter 7 of the novel Heathcliff says, â€Å"I’m trying to settle how I shall pay Hindley back. I don’t care how long I wait, if I can only do it at last. † This quote shows the grudge he holds against Hindley and his unwillingness to forgive him. Quotes like these can be plucked out from various chapters in the novel, but they all reveal the same thing about Heathcliff. No matter whether it has been a week or years, he seems to hold his grudges and be unable to forgive. Another trait that Heathcliff exhibits throughout the novel is his selfish side. I believe this side emerges hand in hand with his unforgiving nature. I think when his world is crashing down around him he decides that he is the only person he can trust and he developes a fear of building a bond that can be severed leading him to be selfish. This selfishness is also reflected in his love affairs as he yearns to be with Catherine once again, not for her own good but simply because he cannot live happily without her. This trait is reflected well when Heathcliff exclaims, â€Å"Catherine Earnshaw, may you not rest so long as I live on. † This quote shows that he could care less if Catherine is able to rest. Instead Heathcliff wants to assure that Catherine will not be freed from her internal conflict before Heathcliff is able to put to rest his own emotional battles. Although many of the traits that Heathcliff is guilty of possessing are on the negative side, he does show great love and emotion in some portions of the novel. This is the side of Heathcliff’s personality that can really make one feel sympathy for him, as it seems that his deep love probably contributes to his negative side. Heathcliff so desperately wants Catherine to return to him that he can hardly live through a day without his emotional tornado wrecking his relations with others. Heathcliff really shows that he wants nothing more than Catherine’s love when he confesses to her his feelings even while she is married. If he loved you with all the power of his soul for a whole lifetime he couldn’t love you as much as I do in a single day. † The fact that Heathcliff is completely unable to move on and get over his feelings for Catherine really display his emotional nature. Heathcliff is one of those characters that will only be fully understood by the person who created the character. For everyone else there will always be room for discussion and disagreements concerning the unforgiving, selfish, yet desperately e motional personality of Heathcliff.

Rosencrantz and Guildenstern

After reading Rosencrantz and Guildenstern are Dead by Tom Soppard, I thought that such a literary masterpiece of that same caliber could not be equaled. However, Samuel Beckett, author of Waiting for Godot has also created a stunning work about two lost men seeking a point to their existence, always looking to the nonexistent for enlightenment. This similarity is so striking that in several points during the story, Rosencrantz and Guildenstern merged with Estragon and Vladimir, so similar were the two characters in some respects. One of many things that made Estragon and Valdimir similar to Rosencrantz and Guildenstern is their inclination to play games with world. Rosencrantz and Guildenstern played the question game where they would ask each other nothing but questions. Ros: We could play at questions. In turn, Estragon and Vladimir also seek ways to distract themselves from the realities of life through word games. Estragon: Thats the idea, lets abuse each other. They turn, move apart, turn again and face each other. Vladimir: How time flies when one has fun! Another striking similarity between the two plays was the constant way in which the main characters questioned everything. These questions, in both cases, stemmed from the main characters amazing lack of memory. Guil: ...Whats the first thing you remember? Ros: Oh, lets see....The first thing that comes into my head, you mean? Guil: No-the first thing you remember. Ros: Ah. (pause) No, its no good, its gone. It was a long time ago. Guil: (Patient but edged) You dont get my meaning. What is the first thing after all the things youve forgotten? Ros: Oh I see. (Pause) Ive forgotten the question.

CW1 Rooms division systems Essay Example | Topics and Well Written Essays - 2250 words

CW1 Rooms division systems - Essay Example   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Deadline & schedule. The twenty rooms will be constructed between November 1 to 30 2006 in order to open to the coming December clients and seminar(Hardill, 33) participants. The planning which includes the design, specifications and contracts will be ready by the end of October 10, 2006.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Planning. The design, specifications(Croak, 51) and contracts will be ready by the end of   June in order to give time for the construction team to acquaint itself with the room construction technicalities.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Budget. Since only local room construction materials will be used, except the room door which will be imported from another country, and only expert construction crews will be hired, the cost of construction will be budget conscious. The budget will funded by   loans with the bank and investments from prospective shareholders in the stock market. The budget will easily be recovered within five years’ time based o n a well researched project feasibility study.   .  Ã‚   The hotel staff will hire an outside building contractor to renovate(Hands et al, 33)   all the rooms of the company. The company will save more money because there will lesser   raw materials wastes when skilled carpenters and their co –workers   work together because as the famous saying  Ã‚   goes, united we stand, divided we fall.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Segmentation. The clients will be concentrated on the couples, their family which includes their children and seminar participants. The entire room can easily be converted to a seminar room that has a capacity to seat around one hundred fifty persons.  Ã‚  Ã‚  Ã‚  Ã‚  

Book Report on Don't Fire Them, Fire Them Up by Frank Pacetta Essay

Book Report on Don't Fire Them, Fire Them Up by Frank Pacetta - Essay Example Although he mentions that an individual is an essential element in any organization, the role of the team or group is emphasized more in the book. This perspective eliminates possible jealousy and unhealthy competition within the organization, thus creating an atmosphere of teamwork and cooperation. Pacetta outlines principles that are doable in both non-military and military settings since the underlying principles of motivation and teamwork are essential in any successful organizational environment. LEADERSHIP IN MANAGEMENT 3 Leadership Principles in Management There are several principles on effective leadership that Frank Pacetta discusses in his book. According to â€Å"The One Minute Manager† author Kenneth Blanchard, leadership skills focused on people are significant for leaders who know that the work force is the primary resource of any organization (Nohria & Groysberg, 2008). In Pacetta’s (1994) book, he touches on the extraordinary potential of a well-directe d and highly motivated human spirit. Although some say that the book is more of a marketing and sales guide because Pacetta (1994) first applies his ideas on marketing and sales, the overall concept discussed in the book is applicable to any organizational setting, corporate or non-corporate. In the book, creating loyalty and developing trust is one of Pacetta’s (1994) important leadership principles. Loyalty and trust creates an atmosphere of teamwork and dependability. Additionally, he mentioned that establishing accountability and encouraging the process of giving constructive feedback is a vital part in an organization. The value of accountability pushes the concept of professional ethics, while feedback encourages working on possible areas of improvement that support continuous development. Generating passion and enthusiasm is also deemed essential. One must remember that a happy employee is a productive employee (Mrudula, 2006). Pacetta (1994) also mentions that a leade r’s ability to enliven, manage, and rebuild an organization is a necessary attitude that encourage employee trust to the organization’s management team. It reflects the internal strength of the organization, thereby promoting a sense of security among employees or members of the organization. To top it off, a leader’s capacity in pushing the organization to the top and maintaining its status at that level develops a sense of pride among every member of the organization. A leader is considered as the LEADERSHIP IN MANAGEMENT 4 one having command responsibility in every aspect of the organization, therefore making the position both challenging and crucial. Pacetta (1994) asserts that although there are normally 3 main reasons for organizational failures --- namely poor leadership, lack of enthusiasm, or skills deficiency --- poor leadership is almost always the main factor why organizations fail. The practicality of the leadership principles presented by Pacetta ( 1994) makes them applicable not only in corporate situations, but also in military settings. In order to realize success and continuous growth within any organizational set-up, there must be strong leadership skills and tactics, and flexibility in methods and processes building and

Marketing plan for Riverford Essay Example | Topics and Well Written Essays - 2500 words

Marketing plan for Riverford - Essay Example The measure has also downgraded the staff level into a manageable number with the delivery system maintained. Cost of the merchandize transacted The summation of the products sold to the clients within the next three years will be obtained from the sellers who have been tasked with keeping a record of the orders completed (Kotler, Keller, Brady, Goodman, and Hansen 2009, p16). Based on the past records, the records have suggested that Riverford affords to deliver to at least 600 homes within England on a daily basis. With the launch of the website service, the number is expected to rise to a minimum of 1000 deliveries daily. The transport cost per delivery is expected to cost 15% of the total delivery made, generating a profit of 23% of the total expenses used in production. The costs of internet services included in the profit ratings include $235 per month, which includes the e-mail service fee. Other Costs The number of trucks to be added in the new delivery routine is expected to be added in the field. The total cost per truck will hike by 10% within the next two years costing $500,000 per truck. The growth would be based on the ability of the company to employ new employees on the management field with four supervisors on the new branches to cost $2500 monthly. The demoted clients are to be compensated as they have helped generate the needed profit and will cost the company an additional $5000 annually for the next three years. The money used in rent for the new offices to be established to complement the existing blocks is estimated to be costing the financial departments a total of $4, 500/month. The other facilities needed would be new refrigerators to preserve some of the products and extra expenses on the packaging that would utilize the biodegradable packing bags to preserve the environment. There is the need to engage in other marketing ventures to sell the newly attained idea to present online marketing franchise (Baker & Hart 2007, p34). The marke ting ventures would include presenting the products on online magazines, covering magazine ads and utilizing community advertising spaces. The company wishes to extend the services to a market beyond the UK presentation hence the desire to collaborate with major restaurants like McDonalds. This would cost an added fee of $1500/month in employing skilful advertisers. The above mentioned criteria can be analyzed to present the vision to present the new service on the desired demographic. The leading groups to be served would be included in the family and company setting (Kotler, Keller, Brady, Goodman, and Hansen 2009, p41). Break even To achieve the desired goods for retention of the employees and deficit the expenditure, there is the need to produce monthly sales of $50, 000 to cater for the incurred costs. The assumption would be placed in the need to venture into new strategies of advertising and completing the sales. The company expects to realize elimination of the competition f rom small-scale businesses and adopt the system of product selection and delivery. Sales forecast The sales have picked up since the company started supplying fruits to the customers who appreciate a wider concentration of the products needed. There company also presents an establishment of the branches that not only specialize in the vegetables, but also witness participation in producing juice that sells the

Development of Credit Facilities in Sierra Leone

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