A Votre Sante Teaching Note Essay Example for Free

A Votre Sante Teaching Note Essay Additionally, the case questions require both quantitative and qualitative analyses of the business issues faced by AVS. AVS has been used in a graduate-level managerial accounting class for MBAs, and would be most appropriate for an advanced undergraduate or a graduate-level accounting or MBA course. The detail in the case is rich enough to support a variety of analyses. Alternative uses could be to have the student construct a cost of goods manufactured statement or a traditional financial statement, both of which reinforce the differences between product and period costs. Additionally, alternative decision analysis questions could be developed using the variable and fixed cost structures described in the case. Case question number two is only one example of a potential decision analysis question. The contribution margin income statement (Teaching Note Exhibit 1) is fairly straightforward, with the following concepts or calculations causing the most difficulty: The inclusion of liquor taxes and sales commissions in variable costs: These are both period expenses, but are clearly based upon the number of bottles sold, and therefore are included in the variable costs. Where to include the wine master expense: Since the wine master is paid according to number of blends, not number of bottles, this expense is listed as a fixed cost. Arguably, it could be listed as a variable cost, given that the cost will be based on the number of wines produced. As part of the discussion we will examine the rationale behind listing wine master as a fixed or a variable expense. Barrel expense: The case states that the barrels produce the equivalent of 40 cases of wine. A case of wine is post-fermentation/bottling and therefore after the 10% loss has occurred. The barrels contain the wine at the start of the process. Therefore, there have to be enough barrels to hold all the wine at the beginning of the process, not at the end. This factor results in 63 (62.5) barrels being required for the harvest2. Teaching Note Exhibit 1: Contribution Margin Income Statement Part b asks, â€Å"What is the maximum amount that AVS would pay to buy an additional pound of Chardonnay grapes?† There are three parts to calculating this answer: the benefit from the additional Chardonnay wine to be sold, the relevant costs related to producing this wine and the opportunity cost of not producing as much Blanc de Blanc wine. Teaching Note: Exhibit 2 displays the calculations relevant to this decision. Chardonnay regular wine requires a 2 to 1 mixture of Chardonnay and generic white grapes. Therefore, the 18,000 pounds of Chardonnay grapes will be combined with 9,000 pounds of generic white grapes. The 27,000 pounds of grapes will result in an additional 9,000 bottles of new Chardonnay regular wine being produced. However, it will also result in a 3,000-bottle decrease in the amount of Blanc de Blanc wine produced, since some generic grapes will now be used for the Chardonnay-regular wine. Recall that only Chardonnay wine is processed in barrels.

GIS: A Step Above Essay -- Business Essays

GIS: A Step Above Urban growth in the suburbs and maintaining what is already built is one problem facing the United States today. One difficulty in regional planning is the visualization of the area in question. Finding the problem areas, addressing all the issues involved, and discovering the best way to implement changes can create challenges for those in charge. A technology that is growing to accommodate the various areas of study which helps address these issues is Geographical Information Systems (GIS). Geographical Information Systems is the prime tool for spatial research. GIS at work Geographic Information Systems (GIS) are used in a wide variety of businesses across the United States. The program can compile various amounts and types of data into the system’s database. The computer can then use the information to aid in spatially analyzing a specific research topic. Information stored in the GIS database is structured to order the information in separate applications. In a study of an urban street, information about the poverty statistics over the last decade would be saved separate from the literacy percentages. This input data could serve to catalog all the information a homeless shelter would record for the different neighborhoods around it. The computer software of the GIS system is what is used to analyze that data. GIS provides â€Å"an accessible, realistic model of what exists in the real world,† (Martà ­n 2) which allows different types of questions to be addressed. â€Å"Spacial means related to the space around us, in which we live and function.† (Clarke 2) The foundation for the use of GIS is to incorporate the many details of life in one location to describe the unit as a whole. ... ...ilities of GIS makes the program software realiable, accurate, and updatable. 6) Martà ­n, David. Geographic Information Systems: socioeconomic applications. Ed. 2. Routledge: London, 1996. - This book defines GIS by its uses, history, and the principles behind the technology. Its purpose is to explain to newcomers how to use the software. It details recent advances in GIS. 7) Vine, Marilyn F., Darrah Degnan, and Carol Hanchette. Geographic information systems: their use in environmental epidemiologic research. Journal of Environmental Health v. 61 no3 (Oct. ‘98) p. 7-16. - This article shows how GIS allows for researchers to show the relationship between human exposure and inset of the disease. The data from previous technology analysis used with the recent data can be used to show the spatial relationsihp of these elements.

Investigate how a major event can influence the hospitality, travel and tourism industry Essay

Executive Summary Within this report it outlines how a major event can influence the hospitality, travel and tourism industries. It will go into great detail about the chosen event and how this particular event impacted these industries, with topics such as what an event is, the chosen event in detail, and how this event impacted these industries. Table of Contents I. Methodology II. Introduction III. Findings IV. Conclusion V. References VI. Appendices VII. Bibliography Methodology After already establishing the basis of the theoretical view of this report, it is now required to reflect on how the evidence will be composed to support the theory and research within this report. There are a number of ways in which this research will be collected. Firstly it will be important to establish what an actual event is as well as definitions of the terms hospitality, travel and tourism. This can be done through secondary sources such as books e. g. Allen, O’Toole et al 2011, websites and newspapers. The chosen event will then show how it has impacted the hospitality, travel and tourism industries in Belfast as well as how the Northern Ireland Tourism Board had this planned as part of Northern Ireland’s preparation of making Northern Ireland a huge tourist destination. Introduction The subject matter of this report is too educate how a major event can influence the hospitality, travel and tourism industries, looking a single event in particular, so that the impacts are more in a personal tone rather than generalising to looking into events as a whole. Definitions will be given of what an event, hospitality, travel and tourism actually are. Topics will include information on the chosen event that will be discussed in greater detail, Belfast as a tourist destination, important impacts on the hospitality, travel and tourism industries. Benefits of a major event within a city. How a major event can impact on a city or destination improvements, and a brief incite into Northern Ireland’s Tourist Board’s plan for Northern Ireland to become a huge and popular tourist destination in the future. Investigate how a major event can influence the hospitality, travel and tourism industry. For this report I have chosen to research and ‘Investigate how a major event can influence the hospitality, travel and tourism industry. ’ The event in which I aim on investigating is the opening if the Titanic Signature Building. This report will explain in detail how the opening of the Titanic Signature Building influenced the hospitality, travel and tourism industries. Within this report you will be introduced to the main question of this report. Topics will include talking about the building itself, its visitor numbers, Belfast as a tourism destination, the impacts the building had on Belfast’s hospitality, travel & tourism industry. â€Å"The hospitality and tourism industry is a multi-billion-dollar industry with 700 million international travellers per year around the world,† said Zainal (2012) in his book, ‘Current Issues in Hospitality and Tourism: Research and Innovations. ’ According to the oxford dictionary the exact definitions of what an event, hospitality and tourism actually are. â€Å"An event is described as a thing that happens or takes place, especially one of importance, a planned public or social occasion. † â€Å"Hospitality is the friendly and generous reception and entertainment of guests, visitors or strangers. † And the definition of tourism is the â€Å"temporary movement of people to destinations outside their normal places of work and residence, the activity undertaken during the stay in those destinations, and the facilities created to cater for their needs. † According to Northern Ireland Tourist Board (NITB) the Northern Ireland vision is, ‘To create the new Northern Ireland experience and get it on everyone’s destination wish list. ’ As the well-known slogan for Northern Ireland 2012 was that â€Å"Northern Ireland 2012 is our time, our place† This means that NITB have stated that they think Northern Ireland is a rising tourist destination. And that Northern Ireland is trying to offer a unique way to be involved and to celebrate. And we as a city need to take our story to a wider audience. So as part of this transaction to take ‘our story’ to a wider audience, the Titanic signature building project started. Shone and Parry (2010) said that â€Å"for a town or city wishing to become a tourist destination, elements such as attractions, accommodation, transport, infrastructure and facilities must be present. † Belfast has been in the middle of this process over the past few years, and especially as 2012 was meant to be ‘our time, our place’ Belfast certainly lived up to this. And a huge part was the titanic signature building. The Titanic Signature building is the world’s largest Titanic visitor attraction & 400,000 visitors were expected to visit the building per annum & 900,000 per annum footfall through the building. Within the first 6 months, 500,000 people had already visited Titanic Belfast. â€Å"One of the most important impacts is the tourism revenue generated by an event. In addition to their spending at the event, external visitors are likely to spend on travel, accommodation, and goods and services in the host city. Titanic Belfast was part of NITB’s plan to attract visitors to Belfast and Northern Ireland with a consequent increase in revenue, which will generate jobs and income. Based on projected visitor numbers its one off the most expensive buildings of its kind in Europe. It cost ? 77million to construct, with most of the funding (? 60million) coming from the public’s wallet. Mike Smith, the chief executive of the building said that, â€Å"We think the building is good value for money. † The opening of the Titanic Belfast produced instant employment benefits as it was estimated that 200 people would be needed to work in the building. The projected increase in visitor numbers, from within the UK and Ireland as well as internationally, will lead to a corresponding demand for local hotels and services, therefore generating job opportunities in the construction and hospitality sectors. Allen, O’Toole et al 2011, talked about how a major event has potential to bring ‘new money’ into Belfast from outside visitors. â€Å"The role event tourism is required to play in a destination’s tourism development efforts will vary according to the overall tourism strategy that is being pursued. † (Allen, O’Toole et al 2011) Belfast is now a popular short-break destination and one of Europe’s top visitor destinations. In 2006, Belfast had 6. 8 million tourists compared to 2011 when we had 7. 86 million tourists. There was quite a number if impacts the opening of Titanic Belfast had on tourism on not only Belfast but Northern Ireland as a whole. The Titanic Signature building is located only 5 minutes from the city centre, so therefore this increasingly popular tourism attraction is not difficult to travel to, there are buses to the Titanic Quarter every 10-15 minutes from the City Centre. It is also within walking distance. The city centre is always crowded with tourist companies who are there to promote tours of the city, these tours run every day and very frequently, they seem to be every popular and since the opening of the Titanic Signature Building, a new tour opened up that was solely about the Titanic alone and it’s attractions. â€Å"Events add to the range of experiences a destination can offer, and this then adds to its capacity to attract and hold visitors for longer periods of time. † (Getz and Wicks 1994) Since the opening of the Titanic Building, this saw Belfast’s biggest jump in hotel occupancy in March 2012 in nearly a decade and a 12% year on year hike in revenues. Then in April saw the year on year occupancy in Belfast’s leading hotels increase by 25%, the average is usually are 15% over April 2011. Belfast’s PWC partner Stephen Curragh said, â€Å"Overall, 2012 has been a successful year for Belfast hotels thus far, but it is off a very low base and will require sustained visitor numbers to bring Belfast back to pre-downturn levels of profitability. † Allen, O’Toole et al (2011) said that events can also provide a significant spur to both public and private investment in a destination. Large scale events can play in destination renewal and in the later development of a destination’s attractiveness and capacity as a tourist destination. NITB have identified excellent events and business tourism as two of their winning themes with the potential to deliver competitive advantages for Northern Ireland as part of their tourism Strategic Framework for Action 2004-2007. NITB said, â€Å"Note for the Excellent Events theme, research confirms that events are an effective tool for changing perceptions and attracting visitors. † Opportunity 2012 2013 2014 2015 Total Additional Visitors 150,00 333,000 200,000 150,000 833,00 Additional Revenue ?24 million ?52 million ?34 million ?30 million ?140 million Created Jobs 612 1,326 867 765 3,570 This table, which can be found on NITB’s 2012 guide, shows NITB’s goal for the future, which is to increase tourism spend to ? 1 million by 2020 and to increase visitor numbers to 4. 5 million by 2020 It shows NITB’s plan in more detail. In 2013 their plan is at its peak by expecting to have 333,000 additional visitors into Northern Ireland which will then create 52 million additional revenue and will generate 1,326 extra jobs in Northern Ireland. Events can affect the hospitality, travel ; tourism industries in many ways. In Belfast due to the opening of the titanic building we have shown you that there has been quite a high incline in Belfast as a tourist destination. Overall we found that the Titanic Building has had an positive impact on hospitality and tourism in Belfast. â€Å"2012 is about changing global perceptions and trying to get tourists to come to Northern Ireland,† – Arlene Foster.

Contemporary Issues in Accounting and Finance - Free Essay Example

Sample details Pages: 8 Words: 2448 Downloads: 9 Date added: 2017/06/26 Category Finance Essay Type Narrative essay Did you like this example? Bankers remuneration is perceived amongst the core recession triggers, which lured top bankers to engage into socially wasteful investments. The aim of this report is to discuss how remuneration packages may affect bankers behavior in the short and long term. Furthermore it will provide a critical evaluation of the main recommendations of the Walkers Review. Lastly, a comparison of the remuneration packages of directors in Barclays and RBS will deliberate whether they are justifiable with performance. Remuneration is defined as the payment that generally comprises the base salary topped with any bonuses or other economic benefits which an employee or executive receives during employment in exchange for professional services (Investopedia, 2011). It can be divided into fixed pay (not depending on any criteria) or variable (whereby additional payments or benefits are function of performance or various contractual agreements such as sales, profits, return on assets). The above are correlated with the output of the accounting system but may also reward in line with market price of the firms shares. Both these components may include monetary payments or benefits (such as cash, shares, options, pension contributions) or non-monetary benefits such as health insurance, discounts, fringe benefits or special allowances for car, mobile phone (CEBS, 2010). Don’t waste time! Our writers will create an original "Contemporary Issues in Accounting and Finance" essay for you Create order Regulatory bodies, (i.e. G20, Committee of European Banking Supervisors), seem to concur that the inappropriate remuneration structures of some financial institutions have been a contributory factor towards the failure of individual financial institutions and systemic problems in the European Union Member States and worldwide. Remuneration policies that offered incentives and encouraged risk-taking above a certain tolerable degree at institution level undermined sound and effective risk management and exacerbated such behaviour. It was admitted that excessive remuneration in the banking industry fuelled a risk appetite disproportionate with the loss-absorption capacity of the sector (CEBS, 2010). The remuneration of bankers situates at the very centre of moral outrage succeeding the financial crisis. While regulators are mostly concerned with the remuneration structure which incentivised undue risk-taking, society sternly blames the pay-offs to senior executives of failed banks and large bonuses which rewarded bankers whose activities were entangled with the crisis triggering mechanism. The protest is greatly about the perversity of apparently mischievous prizes for blatantly imposing such costs on other stakeholders. The mainstream analysis of moral hazard (information asymmetry) assumes behaviour to be rational with respect to self-interest, in other words opportunistic in the sense that it takes advantage of chances to achieve personal benefit regardless whether that may happen at the others expense (Dow, 2010). Society perceives bonuses as the main drivers of greed and irresponsibly short-sighted behavior (pp. 1). From an economic point of view, the central critiques about bonuses are concerned with risk-taking and short-term orientation. Nonetheless, it is noteworthy that the design of the overall compensation package appears to have generated bankers myopia rather than the bonus system per se. In fact, most banks now concur that, preceding the crisis, their systems were excessively short-sighted, and are currently striving to base rewards on more sustainable performance criteria such as average growth rates and volumes across longer sampling periods (Gehrig Menkhoff, 2009). Bonuses have stirred widespread aversion feelings because of their asymmetric payoff structure which invites risk-taking by bankers. As such, should the risky investment have succeeded, the manager would have been granted a hefty compensation; whereas even in the unfavourable scenario, he still satisfied with a comfortable fixed salary incurring no further repercussions. Put differently, the bonus-based compensation package failed to penalise accordingly the various outcomes of jeopardising investments and consequently encouraged them (Gehrig Menkhoff, 2009). The remuneration policy should be in line with the business strategy, objectives, values and long-term interests of the credit institution. Otherwise, if the variable part of the remuneration consists predominantly of remuneration instruments that are paid out immediately, without any deferral or ex post risk adjustment mechanisms, based on a formula that links variable remuneration to current year revenues rather than risk-adjusted profit, there are strong incentives for managers to shy away from conservative valuation policies, to ignore concentration risks, to rig the internal transfer pricing system in their favour and to ignore risk factors, such as liquidity risk and concentration risk, that could place the institution under stress at some point in the future (CEBS, 2010). The Principal-Agent theory implies that executive compensation should be correlated with the total return to shareholders, commonly by granting ownership of the firm through stock or options. However, despite this frameworks compelling logic, existing empirical support contradicts the effectiveness of the agency theory when applied to executive compensation (Kakabadse et al, 2004). They are also meant to serve as an effective retention tool for talent in the long term, meaning they should motivate loyalty in successful bankers. However, stock options reward success, but normally do not penalize failure (Branca and Imelmann, 2009). Frabotta (2000a) argued that short-term strategies may in fact achieve differing outcomes to those actually sought, as they may not be congruent with the long-term profitability of an organization (Taylor and Davies, 2004, pp. 468). As such, bankers might seek to maximize short-run profits by employing creative accounting. This comprises methods such as discretionary costs management (i.e. reduction in allowance for doubtful clients with a view to increase net accounts receivable), sales and expenses adjustment, or non-operational profits e.g. asset disposals. Furthermore, medium-term behaviour might encompass income smoothing to reduce earnings volatility and ensure less variable flow of benefits for the more loss-averse directors. According to Prasad (2008), evidence shows that executives contractually entitled to receive exhilarating pensions, tend to pursue corporate strategies which aim to reduce the overall risk of the firm. As such, these executives embark on fewer risky investment projects, reduce dividends, avoid excess debt or expand the average maturity of corporate debt. Likewise a CEO is more likely to retire voluntarily his pension has vested and is immediately payable. Besancenot Vranceanu (2007) based their study of compensations plans on game theory. The purpose was to analyse whether such structures incentivized managers to engage in fraudulent activities. Their model rendered that under perverse incentive plans managers eluded regulations and committed fraud. Walkers Review Sir David Walkers Review of corporate governance in UK banks and other financial industry entities was requested by the UK government in order to evaluate what prompted the financial crisis and how its recurrence could be prevented in the future. The final report suggests a series of reforms to improve the quality of boards, strengthen the role of shareholders, and increase transparency of pay and bonus structures. At the core of the recommendations lies the clear link which the author identifies between board behaviour deficiencies and poor business performance (Gill, 2009). The Review hints at the idea that some banking groups managed to survive the crisis and in relative terms have prospered, whereas others failed to do so and pleaded mercy from governmental bailouts. This situation indicates the gap in the quality of corporate governance between the two categories (Slaughter and May, 2009). One of the most important and controversial themes in Walkers (2009) Review is the remuneration policy of financial institutions. The recommendations in this respect emphasize that the board level oversight of remuneration policies demands substantial enhancement, in particular where variable pay and associated disclosures are concerned. Besides, the board remuneration committees should receive extended responsibility to cover the entire entitys remuneration framework especially executives whose remunerations exceed the median level throughout the board high end category. The term depicts employees who can have a material influence on the direction and risk profile of the entity (pp. 93). Through deliberate insistence on long-term focus, they should stand as a major countervailing force against any short-term pressure from shareholders or the executive. Furthermore, with a view to better align interests, performance conditions and deferment of variable payments for executives should be materially more demanding than anterior industry norms. In other words, it is advised that at least half of expected variable remuneration should be on a long-term incentive basis, and the actual granting depending on performance conditions, to be deferred for up to five years. As to the short-term bonus, which rewards the executive for performance in the current year, the proposal is that payments under any award should be phased over a three-year period, with at most one-third in the first year. Despite being convincing at first sight, the Reports main recommendations concerning financiers remuneration mask a more fundamental issue of principle: that the current bonus problem is a creation of accounting fictions of reliance on accrual accounting recognition of profit instead of economic profit. Focusing on earned or realised profit as the basis for bonus entitlement would eliminate many of the highlighted problems. The result of such a change in perspective would be similar to the intent of the Report; however it would possess the advantage of returning the debate to a focus on principles (Paradigm Risk, 2009). What is more, other critics such as Barker (2009) assess the recommendations regarding remuneration to be rather prescriptive or too specialised for implementation in the non-financial sector. The Walker Review does not seek to define the quantum of remuneration that should be awarded to board members or other high-end employees. However, it delivers several proposals which target the improvement of the remuneration structure in terms of links with risk taking and performance. An interesting proposal advocated in the Review is that the Chairman of the remuneration committee should stand for re-election if the issued report receives fewer than 75% of votes cast at the AGM. This would serve to increase the accountability of the remuneration committee vis--vis shareholders. Remuneration packages and Performance Remuneration packages of banks directors are made up of the basic salary and benefits which are topped by several cascading layers of rewards such as pension provisions and various bonuses. Barclays claimed that it had shown restraint on pay as it revealed that its chief executive, Bob Diamond, was paid a bonus of 6.5m for 2010. He also earned a 250,000 salary and was awarded a 2.25m long-term payment based on future performance. As chief executive he will be paid a 1.35m basic salary, a 20% raise compared to his predecessor (Treanor, 2011). But the debates are ongoing as Barclays plans to pay its top bankers bonuses in the form of cocos contingent convertible bonds. These are meant to represent a progressive form of rewards compared to the traditional distribution of upfront cash bonuses. In Barclays case, the recipient would not receive the amount in question if the banks core capital ratio (10.8% most recently) fell below 7% at any time during the three years after an award. Thus , the intention is to foster an incentive for traders not to assume any risky endeavours since they must wait three years to turn their bonus into cash. However, stakeholders are irritated with the 7% coupon, or rate of interest, substantially higher than any three-year savings rate available to customers, which Barclays has attached to the cocos to alleviate the waiting period (Pratley, 2011). The question on the adequacy of such staggering sums is to be dealt with in conjunction with the banks performance. Last year, Barclays recorded a Group profit before tax of 6,065m, up 32% compared to 2009: 4,585m. Diamond confessed pride with such an achievement, especially with the profit growth and enhanced capital and liquidity positions. He also praised the integrated business model which seemingly provides superior benefits to customers, clients and broader stakeholders because of its diversity by business, geography and funding source (Barclays, 2011). According to the Groups Finance Director, commenting previous years performance, the Core Tier 1 ratio increased to 10.8 %, return on equity was 7.2%, and return on risk weighted assets increased 26 basis points year on year to 1.12%. Earnings per share grew 26% to 30.4p. The total dividend for the year of 5.5 pence was more than 5 times covered (Lucas, 2011). All things considered, this accrual accounting perspective does indee d convey outstanding results for the past financial year which might arguably justify hefty rewards for the key bankers. On the other hand, one might not allow similar indulgence to Fred Goodwin from RBS. He was granted 9m in salary, 14m bonuses, and 276,000 extras (relocation expenses, school fees) totaling over 23m for the past 9 years of employment for the state-aided financial giant. Skeptics would catalogue these amounts as enormous rewards for failure. What is more, this former CEO gathered a sufficiently high pension pot to allow him the comfort of withdrawing 703,000 a year pension. Specialist lawyers infer that his contract was wisely and tightly drafted in his favour and very well negotiated. Moreover, the expenses incurred by the company to keep its executives pleased also included lavish benefits such as a permanent luxurious Savoy hotel suite; fleets of cars available at all times, special food, uncalled for refurbishment of floors, use of own corporate jets on regular bases (Dispatches, 2009). However, all these come in striking contrast with the modest performance of the bank under Goodwins steering. In 2008, RBS posted the biggest loss in corporate history and required a bail-out of 45.5bn (Andrews, 2010). Upon the freezing of the financial markets during that year, the government was forced to acquire 5bn of preference shares in RBS and another 15bn of ordinary shares provided the bank would not find willing private investors (BBC, 2008). Nonetheless, despite requiring such rescuing of last resort, Sir Goodwin escaped punishment by the Financial Services Authority. Although the investigation carried out by this entity revealed a series of bad decisions, it concluded they were not the result of a lack of integrity by any individual nor were any instances of fraud or dishonest activity identified (Andrews, 2010, pp. 1). Even under these terms the matter of excessive and undeserved payment remains unquestioned and was even recently confirmed by the banks Chairman, Sir Hamp ton who assessed that the bank was paying a lot of people who arent worth it and implied regulation would be the only key to this hot issue (Rowley, 2010). Contrary to public indignation with such policies, results of a study (Fahlenbrach and Stulz, 2011) show no evidence to prove that banks having a better alignment of the CEOs and shareholders interests had higher stock returns during the crisis. Some findings even revealed that banks led by CEOs whose interests were better aligned with those of their shareholders had worse stock returns and a worse return on equity. Consequently, many other factors were at play and potentially, in certain cases, an accumulation of uncontrollable events leaned the balance against them. Although the Walker Review might be a step forward in regulating the financial industry, one should bear in mind that a narrowing down the investigation lenses on the executives remuneration might be superficial and inconclusive.