Biography of Bobby Seale, Black Panther Party Co-founder

Bobby Seale (born October 22, 1936) co-founded the Black Panther Party with Huey P. Newton. The organization, which was the most well-known group launched during the black power movement, stood out for its free breakfast program and emphasis on self-defense—a departure from the nonviolent philosophy advocated by civil rights activists. Fast Facts: Bobby Seale Known For: Co-founder, along with Huey P. Newton, of the Black Panther PartyBorn: October 22, 1936 in Dallas, TexasParents: George and Thelma SealeEducation: Merritt Community CollegeSpouse(s): Artie Seale, Leslie M. Johnson-SealeChildren: Malik Seale, Jaime SealeNotable Quote: â€Å"You dont fight racism with racism, the best way to fight racism is with solidarity. Early Life and Education Bobby Seale, the first child of George and Thelma Seale, was born on October 22, 1936. He grew up with a brother (Jon), a sister (Betty), and a first cousin (Alvin Turner—the son of his mother’s identical twin). In addition to Dallas, the family lived in other Texas cities, including San Antonio. Seales parents had a rocky relationship, separating and reconciling repeatedly. The family struggled financially and sometimes rented out parts of their home to other families to earn additional income. Seales father, George, was a carpenter who once built a home from the ground up. He was also physically abusive; Bobby Seale later described being whipped with a belt by his father at age 6. When the family moved to California, George Seale struggled to get carpentry work or join a union, as unions often excluded African Americans during the Jim Crow era. When George Seale did manage to enter a union, he was one of just of three black men in the state with union membership, according to Seale. As a teenager, Seale hauled groceries and mowed lawns to earn extra cash. He attended Berkeley High School but dropped out to sign up for the US Air Force in 1955. After a conflict with a commanding officer, Seale was dishonorably discharged. However, this setback did not deter him. He earned his high school diploma and made a living as a sheet metal mechanic for aerospace companies. He also worked as a comedian. In 1960, Seale enrolled in Merritt College, where he joined a black student group and his political consciousness took hold. Two years later, he met Huey P. Newton, the man with whom he would start the Black Panthers. Founding the Black Panther Party At a 1962 demonstration against the Kennedy Administrations naval blockade of Cuba, Seale befriended Huey Newton. Both men found inspiration in black radical Malcolm X and were devastated when he was assassinated in 1965. The next year, they decided to form a group to reflect their political beliefs, and the Black Panthers were born. The organization reflected Malcolm X’s philosophy of self-defense by any means necessary. The idea of armed African Americans proved controversial in the broader United States, but as the civil rights movement waned following the assassination of the Rev. Martin Luther King Jr., many young black Americans leaned towards radicalism and militancy. The Black Panthers were particularly concerned about racism in the Oakland Police Department, but before long, Panthers chapters sprang up nationwide. The Black Panther Party became most well known for their 10-point plan and free breakfast program. The 10-point plan included culturally-relevant teaching, employment, shelter, and exemption from military service for African Americans. Legal Battles In 1968, Bobby Seale and seven other protesters were charged with conspiring to incite a riot at the Democratic National Convention in Chicago. When the trial date arrived, Seales lawyer was ill and unable to appear; the judge denied the request to delay the trial. Seale claimed the right to defend himself in order to advocate for his own constitutional rights, but the judge did not allow him to give an opening statement, cross-examine witnesses, or speak to the jury. Seale contended that the judge had denied him his right to counsel, and he began to speak out in protest during the proceedings. In response, the judge ordered him bound and gagged. Seale was chained (later strapped) to a chair, with his mouth and jaw strapped shut, for several days of the trial. Ultimately, the judge sentenced Seale to four years in prison for contempt of court. That sentence was later overturned, but it did not mark the end of Seale’s legal troubles. In 1970, Seale and another defendant were tried for killing a Black Panther believed to be a police informant. The hung jury resulted in a mistrial, so Seale was not convicted of the 1969 murder. As his court battles unfolded, Seale wrote a book tracing the history of the Black Panthers. The book, published in 1970, was titled Seize the Time: The Story of the Black Panther Party and Huey P. Newton. But the time Seale spent behind bars awaiting the outcomes of various court cases had taken a toll on the group, which began to fall apart in his absence. The settling of the court cases saw Seale take charge of the Panthers again. In 1973, he changed focus by putting his bid in to become the mayor of Oakland. He placed second in the race. He left the Panthers the following year. In 1978, he wrote his autobiography, A Lonely Rage. Later Years In the 1970s, the black power movement subsided, and groups like the Black Panthers ceased to exist. Deaths, prison sentences, and internal conflicts spurred by initiatives like the FBI’s Counterintelligence Program played a role in the unraveling process. Bobby Seale remains politically active, giving talks on his life and activism at college campuses and other venues. More than 50 years after the Black Panthers formed, the group continues to influence politics, pop culture, and activism. Sources â€Å"Bobby Seale.† PBS.org.Bennett, Kitty. Bobby Seale: Black Panther leader was one of the Chicago Eight. AARP Bulletin, 27 August, 2010.Glass, Andrew. Kennedy imposes naval blockade of Cuba, Oct. 22, 1962. Politico, 22 October, 2009.Seale, Bobby. â€Å"Seize the Time: The Story of the Black Panther Party.† 1970.

Embracing the Past A Difficult Ideal in African American...

During the struggle to rise to a higher social class, many African Americans have chosen to embrace white ideals while rejecting their heritage and anything that associates one with their â€Å"blackness† This type of rejection to one’s culture has been shown many times in African American literature. In â€Å"The Wife of His Youth,† by Charles Chesnutt, and Invisible Man, by Ralph Ellison, the authors use their writing to show this disconnection; both Chesnutt and Ellison are able to capture the struggle and help their characters to overcome it by embracing their pasts, which can be a very difficult ideal in African American heritage. In â€Å"The Wife of His Youth,† the main character, Mr. Ryder, is a man that has left slavery behind and has been†¦show more content†¦Ryder’s actions, was when he said ’Perhaps hes outgrown you, and climbed up in the world where he wouldnt care to have you find him’ (Chesnutt 926). This is tr uly the struggle for not only Mr. Ryder as the protagonist, but also for many other members of the African American community. As Mr. Ryder has built himself up so high, he would not want to embrace his slavery roots, which includes his slave wife. During the Blue Vein Society event, which he was going to host in order to propose to a young, very prominent lighter colored woman, Mr. Ryder gives a speech hypothetically laying out the woman’s story from her husband’s point of view. He talks about the rags to riches story of an escaped slave man who â€Å"made his way to the North†¦ where he had larger opportunities.† This man continued to grown up â€Å"to be as different from the ignorant boy who ran away from fear of slavery as the day is from the night.† He lists his own accomplishments of qualifying himself â€Å"by industry, by thrift, and by study† to be held in such high esteem by the community and by the Blue Vein Society. Then he mentio ns the wife he left behind, â€Å"not one who had walked by his side and kept pace with him in his upward struggle,†(631) but one who has continued to lead a downtrodden life. The strain in his decision is based on all of these factors. If Mr. Ryder embraces his previous slave wife, he would be giving up his prestigious life, one the he strived towards whileShow MoreRelatedCultural Immersion Project 3- Couple of the Muslim Faith Lillian Reaves1481 Words   |  6 Pagesa result of Rahim’ childhood experience, those experiences made him unsocial and difficult for him to relate with the opposite sex. Despite the negative effect that Rahim’s cultural background has had on his social life, the background has made him become determined and responsible in life. His cultural beliefs have played a significant influence in his past relationships. Dina cultural background is African American. To me, this seemed to be a perfect chance for a successful marriage since theyRead MoreBlack Naturalism and Toni Morrison: the Journey Away from Self-Love in the Bluest Eye8144 Words   |  33 Pagesnaturalistic perspective; however, while doing so I will propose that because Morrison s novels are distinctly black and examine distinctly black issues, we must expand or deconstruct the traditional theory of naturalism to deal adequately with the African American experience: a theory I refer to as black naturalism. But before I do this I think it is important to discuss why it is worth our while to dig up naturalism once again to explore not only earlier black novels but contemporary works as wellRead MoreThe History of Mexican Americans Essay2462 Words   |  10 PagesProblems in Mexican American History Zaragosa Vargas writes, Nearly two thirds of Latinos in the United States are of Mexican descent, or Chicanos- a term of self definition that emerged during the 1960s and early 1970s civil rights movement. Chicanos reside mainly in the Southwest, the Pacific Northwest, and the Midwest. Their history begins in the precolonial Spanish era, and they share a rich mestizo cultural heritage of Spanish, Indian, and African origins. 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Furthermore, a recent intelligence agency report stated findings that employees coming to retirement ageRead MoreEmployee Engagement and CSR: TRANSACTIONAL, RELATIONAL, AND DEVELOPMENTAL APPROACHES12982 Words   |  52 Pagesâ€Å"Volunteerism is a linchpin of the integrated philanthropy system— providing energy, expertise, and time to build the capabilities of nonprofits, and ensuring that each employee embodies the values and social mission of the organization.† In the past decade, Unilever employees have been engaged en masse to make over the business. On the food side, twenty thousand recipes have been reformulated to reduce trans fat, saturated fats, sugar, and salts. Base-of-the-pyramid investments in home CALIFORNIA

Ambiguity in Projects Samples for Student-Myassignmenthelp.Com

Question: Discuss about the Ambiguity in Projects. Answer: Introduction Ambiguity, in the literal sense of the world, refers to the situation or a statement that can lead to more than one interpretation. According to Philippo et al. (2013), one of the most essential criteria that is expected of project managers is to have the capability of managing ambiguous situations, as most organizational project teams are bound to face certain ambiguous situations during the life cycle of the entire project. FCB Abu Dhabi Advertising Agency is one of the leading advertisement agencies of the United Arab Emirates. The agency has been associated with some of the biggest campaigns of the year, like those used by Coca Cola, Paper Plus, Nivea and Levis. The following sections of the report provides an insight into the ambiguous scenarios that project teams associated with the organization have experienced in real life and the impact of such ambiguity on the lifecycle of the project. Background of the organization Foote, Cone Belding, or FCB is one of the largest advertising networks operates globally. Headquartered at Chicago, the organization is currently owned by the Interpublic group. At present, the organization operates across 90 countries of the world, the UAE being one of the most prominent ones (Fcb.com 2016). The FCB Abu Dhabi Advertising Agency has been in the receiving end of several awards, including the Caples, Effies, El Ojo along with those awarded at The One Show and the Cannes. In fact, the organization is well known for its genuine participation in ensuring the success of their client brands. Ambiguous situation in the organization Khushbu, a UK based fashion line had approached the sales team of The FCB Abu Dhabi Advertising Agency with the aim of branding their products in the UAE. Kushbu is a well known fashion brand in Europe, primarily due to the unique nature of the products that they sell: perhaps it is the sole organization that sells 'Islamic Wear' for women, using online platforms (Khushbu.tootinglife.com 2016). It is well known fact that women residing in the United Arab Emirates are encouraged to wear 'Islamic Wear', thus the interest expressed by the administrative authorities of Kushbu so as to launch their products in the country was solely based on the demands of the market (Epps and Demangeot 2013). However, the members of this project teams soon identified certain ambiguous situations that they felt should be resolved before the campaigns could be designed and launched: 1. The first and foremost issue that the project team identified was that the tagline used by Khushbu: while selling their product in Europe, Khushbu used the tagline Even covered women care about their appearance (Khushbu.tootinglife.com 2016). However, the project team of The FCB Abu Dhabi Advertising Agency was spilt into halves regarding the tagline to be used while launching the product line on the national television of UAE: while some of the members were against robbing off the brand of their signature tagline, yet another section was skeptical about using the same (they feared that the tagline might appear to be disrespectful towards the women residing in UAE) (Fcb.com 2016). 2. On the other hand, the project team had also identified the fact that the products launched by Khushbu were quite high (Khushbu.tootinglife.com 2016). The team was thus uncertain about the section of the population that should be targeted in the campaigning process. Besides, the pricing strategy, the un-traditional features of the 'Islamic Wears' designed and sold by the fashion line also required the identification of the particular section of the population that could be targeted, much before the campaigns could be designed (Pasha-Zaidi, Masson and Pennington 2013). At the very same time, the project team were not able to cover all sections of the potential customers (top, low and mid) as campaigns of such large scale require huge budgetary funds that the authoritative heads of Khushbu were not eager to bear with (Fcb.com 2016). Thus, it can be said that the ambiguity of the project laid in the fact that in spite of Khusbus idea being innovative, their signature tagline, style and design were controversial and that The FCB Abu Dhabi Advertising Agency neither had the data required to identify the section of the population that could be targeted effectively. In order to find solutions to the issues identified by the project team, the marketing team indulged in an extensive market research regarding the demand of the untraditional Islamic wears (similar to the ones designed and developed by Khushbu) among the women of the United Arab Emirates (Fcb.com 2016). Besides this, the marketing team also put efforts towards realizing whether the signature tagline of the brand would be acceptable to the UAE society. After the data collection process was completed, analytical tools were used to identify that particular section of the population that could be targeted for the purpose of campaigning. Besides this, the marketing team ultimately developed a new tagline for the fashion line with which the products were launched in the market (Epps and Demangeot 2013). Impact of the ambiguity on the organizational projects The impact of the ambiguous situation (as described in the section above), have been enlisted below: Positive Impacts the ambiguity on the organizational project The first and foremost point that demands mention in this context is that the fashion line of Khusbu was finally launched in the UAE without raising any discontent or complaints from the generals mass: courtesy to the new tagline designed by the project team of The FCB Abu Dhabi Advertising Agency (Khushbu.tootinglife.com 2016). Figure: Khusbu launched in UAE with a new tagline (Source: Khushbu.tootinglife.com 2016) On the other hand, the project team had identified educated women belonging to high income group families should be considered by Khusbu as the primary target customer group in the UAE . It is worth mentioning that almost 70 percent of the students attending Universities in the UAE are women, thus, the market chosen by the project team is quite extensive and promises significant revenue collection (Pasha-Zaidi, Masson, and Pennington, 2013). It is worth mentioning that in spite of the fact that the marketing agency was forced to conduct the survey as they had no information based on which the target market could be decided on, the data collected from the process was efficiently utilized in several other projects: the information available on the official website of The FCB Abu Dhabi Advertising Agency indicates that the campaigns designed for Olay and Nivea were largely based on the results of this particular survey (Fcb.com 2016). Negative Impacts the ambiguity on the organizational project The market survey made by the FCB was conducted over a period of six months, thus incurring considerable amount of cost to the fashion line. Thus increased time and budgetary requirements of the project were the primary adverse impacts of the ambiguities of the project (Gutirrez 2014). On the other hand, Khusbu is a renowned brand among the Muslim communities of the United Kingdom. Robbing of the brand of their signature tagline indeed forced them to build their reputation in the UAE from the scratch. Importance of acceptance of ambiguity in conducting a successful project Researchers Philippo et al. 2013 are of the opinion that among very few well tested and approved laws of conducting successful projects, the fact that Ambiguity Kills Projects holds true for projects of all sizes, structures and domains. However, the authors have also pointed out the very fact that in spite of the large number of tools and methods available for managing projects, embracing ambiguities is still considered to be imperative. Researcher Gutirrez (2014) seconds their opinion by stating that the very fact that the presence of ambiguities has adverse effects on the success of projects encourages project teams to document the SMART goals of the project, to identify the risks associated with it, to define the scope of the project and to develop strategies that could be used for overcoming the uncertainties. Thus, it can be said that while acceptance of ambiguity in projects might lead to disastrous outputs, embracing the same actually results in the utilization of methods that enables optimum management of the said projects. In respect to the situation under consideration, the campaigns designed for Khusbu might have been ruined completely in case the marketing team of The FCB Abu Dhabi Advertising Agency had incorrectly identified the target market (Fcb.com 2016).. Conclusion The above mentioned sections of the report provide an insight into ambiguities identified in one of the campaigning projects undertaken by The FCB Abu Dhabi Advertising Agency. The ambiguities have been defined in section 3, along with the measures taken by the project team to overcome it. Besides this, the impact of the ambiguous situation (both positive and negative) on the success of project have been provided in section 4, while a generalized discussion on the effects of accepting project ambiguities has been provided in section 5 of the report. In the light of the information provided in the report, it can thus be concluded that while ambiguous situations indeed threat the success of organizational projects, the attempts and efforts made towards overcoming such uncertainties leads to the adaptation of strategies that ultimately leads to the successful completion of any project, irrespective of its size, structure or domain. References Epps, A. and Demangeot, C., 2013. The rainbow of diversity versus the rain of fragmentation: the futures of multicultural marketing in the UAE.Foresight-The journal of future studies, strategic thinking and policy,15(4), pp.307-320. Fcb.com, 2016.FCB Abu Dhabi Advertising Agency - United Arab Emirates. [online] FCB Global. Available at: https://www.fcb.com/location/abu-dhabi [Accessed 27 Jul. 2016]. Gutirrez, E., 2014. Managing Ambiguity When Evaluating and Selecting New Ideas in Project Portfolio Management.International Journal of Innovation and Technology Management,11(05), p.1450030. Khushbu.tootinglife.com, 2016.Khushbu - Women's wear, Fashion, Salsas kameez in TootingLife. [online] Khushbu.tootinglife.com. Available at: https://www.khushbu.tootinglife.com [Accessed 27 Jul. 2016]. Pasha-Zaidi, N., Masson, T. and Pennington, M.N., 2013. Can I get a job if I wear Hijab? An exploratory study of the perceptions of South Asian Muslim Women in the US and the UAE.International Journal of Research Studies in Psychology,3(1). Philippo, E.J., Heijstek, W., Kruiswijk, B., Chaudron, M.R. and Berry, D.M., 2013, April. Requirement ambiguity not as important as expectedresults of an empirical evaluation. InInternational Working Conference on Requirements Engineering: Foundation for Software Quality(pp. 65-79). Springer Berlin Heidelberg.

Nature of Financial Management free essay sample

In the earlier years, it was treated synonymously with the raising of funds. In the later years, its broader scope, included in addition to procurement of funds, efficient use of resources. Scope of Financial Management Financial is broadly concerned with the acquisition and use of funds by a business firm. The important tasks of financial management, as related to the above, may be categorized as follows: A. Financial Analysis, Planning and Control †¢ Analysis of financial condition and preference †¢ Profit Planning †¢ Financial forecasting †¢ Financial Control B. Investing †¢ Management of current assets (cash, marketable securities, receivables and inventories) †¢ Capital Budgeting (identification, selection and implementation of capital projects) †¢ Managing of mergers, reorganizations and divestments C. Financing †¢ Identification of sources of finance and determination of financing mix †¢ Cultivating sources of funds and raising funds †¢ Allocation of profits between dividends and retained earnings Important Topics in Financial Management Table 1. 1 Balance Sheet and Topics in Financial Management Share Capital EquityCapital Structure and Cost of Capital Preference Reserves and Surplus Debentures Unsecured Loan Current Liabilities ProvisionsWorking Capital Trade CreditorsFinancing Policy Provisions Fixed Assets (Net)Capital Budgeting Gross Block Less Depreciation InvestmentSecurity Analysis Current Assets, Loans and Advances Cash and bank balancesCash Management ReceivablesReceivables Management InventoriesInventory Policy Loans and Advances Miscellaneous Expenditure and Losses Table 1. We will write a custom essay sample on Nature of Financial Management or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page 2 Income statement and Topics in Financial Management Net SalesRevenue risk Cost of goods Sold Materials and stocks Wages and Salaries Other Manufacturing Expenses Gross ProfitGross profit margin Operating Expenses Selling and Administration Expenses DepreciationDepreciation Policy Operating Profit Non operating surplus / deficit Earnings before interest and taxBusiness risk InterestFinancial risk Profit before tax TaxTax planning Profit after taxReturn on equity DividendsDividend policy Retained Earnings Goals / Objectives of Financial Management- Traditional Approach – It has been traditionally been argued that the objective of a company is to earn profit. This means that the finance manager has to make decision in a manner that the profit is maximised. Each alternative, therefore, is to be seen as to whether or not it gives maximum profit. Profit maximization objective gives rise to a number of problems as below: i) Profit maximization concept should be considered in relation to risks involved. There is a direct relationship between risk and profit. Many risky propositions yield high profit. Higher the risk, higher is the possibility of profits. If profit maximization is the only goal, then risk factor is altogether ignored. i) Profit maximization, as an objective does not take into account time pattern of return. Proposal A may give a higher amount of profits compared to proposal B, yet if the returns begin to flow say 10 years later, proposal B may be preferred which may have lower overall profits but the returns flow is more early and quick. iii) Profit maximization, as an objective is too narrow. It fails to take into account the social considerations as also the obligations to various interests of workers, consumers, society as well as ethical trade practices. Further, most business leaders believe that adoption of ethical standards strengthen their competitive positions. iv) Profits do not necessarily result in cash flows available to the stockholder. Owners receive cash flow in the form of either cash dividends paid to them or proceeds from selling their shares for a higher price than paid initially. Modern Approach The alternative to profit maximization is wealth maximization. This is also known as Value maximization or Net Present Worth maximization. Value is represented by the market price of the company’s equity shares. Prices in the share market at a given point of time, are the result of many factors like general economic outlook, particular outlook if the companies under consideration, technical factors and even mass psychology. However taken on a long-term basis, the share market prices of a company’s shares do reflect the value, which the various parties put on a company. Normally, the value is a function of two factors (i) The likely rate of earnings per share of a company (EPS) and (ii) The capitalization rate EPS are calculated by dividing the periods total earnings available for the firm’s common shares by the number of shares of common shares outstanding. The likely rate of earnings per share (EPS) depends on the assessment as to how profitably a company is going to operate in the future. The capitalisation rate reflects the liking of the investors for a company. If the company earns a higher rate of earning per share through risky operations or risky financing pattern, the investors will not look upon its shares with favour. To that extent, the market value of the shares of such a company will be low. If a company invests its fund in risky ventures, the investors will put in their money if they get higher return as compared to that from a low risk share. The market value of a firm is a function of the earning per share and the capitalisation rate. Suppose the Earning per share are expected to be Rs. 7 for a share, and the capitalisation rate expected by the shareholder is 20 per cent, the market value of the share is likely to be 7 7 x 100 = - = Rs. 5 20% 20 This is so because at this price, the investors have an earning of 20%, something they expect from a company with this degree of risk. The important issues relating to maximizing share prices are Economic Value Added (EVA) and the focus on stakeholders. Economic Value Added (EVA) is a popular measure used by many firms to determine whether an investment – proposed or existing – contribute positively to the owner’s wealth. EVA is calculated by subtracting, the cost of funds used to finance or investment fr om its after-tax-operations profits. Investments with positive EVA increase shareholder value as those with negative EVA reduce shareholders value. For example, the EVA of an investment with after tax operations profits of Rs. 510,000 and associated financing costs of Rs. 475,000 would be Rs. 35,000 (i. e. Rs. 410,000 – 375,000) Because this EVA is positive, the investment is expected to increase owner wealth and is therefore acceptable. What about Stakeholders? Stakeholders are group such as employees, customers, suppliers, creditors, owners and others who have a direct economic link to the firm. A firm with a stakeholder focus consciously avoids actions that would prove detrimental to stakeholders. The goal is not to maximize stakeholder well being but to preserve it. It is expected to provide long run benefit to shareholders by maintaining positive stakeholder relationships. Such relationship should minimize stakeholder turnover, conflicts and litigation. Clearly, the firm can better achieve its goal of shareholder wealth maximization by maintaining cooperation with other stakeholders rather than having conflict with them. The Role of ethics Ethics is standards of conduct or moral judgment. Today the business community in general and the financial community in particular are developing and enforcing ethical standards, purpose being to motivate business and market participants to adhere to both the letter and the spirit of laws and regulations concerned with business and professional practice. An effective ethics program is believed to enhance corporate value. An ethics program can reduce potential litigation and judgment costs, maintain a positive corporate image, and build shareholders confidence, and gain the loyalty, commitment and respect of the firms stakeholders. Such actions, by maintaining and enhancing cash flow and reducing perceived risk, can positively affect the firm’s share prices. Ethical behaviour is therefore viewed as necessary for achieving the firm’s goal of owner wealth maximization. Place of Finance function in the organization structure: The finance function is almost the same in most enterprises. The details may differ but the important features are universal in nature. The finance function occupies such a major place that it cannot be the sole responsibility of the executive. The important aspects of the finance function have to be carried on by the top management i. e. the Managing Director and the Board of Directors. It is the Board of Directors, which makes all the material final decisions involving finance. Financial management in many ways is an integral part of the jobs of managers who are involved in planning, allocation of resources and control. The responsibilities for financial management are disposed throughout the organization. For example: †¢ The engineer, who proposes a new plant, shapes the investment policy of the firm. The marketing analyst provides inputs in the process of forecasting and planning. †¢ The purchase manager influences the level of investment in inventories. †¢ The sales manager has a say in the determination of receivable policy. †¢ Departmental managers, in general, are important links in the financial control system of the firm. The chief financial officer (CFO) is basically to assist the top manageme nt. He has an important role to contribute to good decision making on issues, which involve all the functional areas of the business. He must clearly bring out financial implications of all decisions and make them understood. CFO (his designation vary from company to company) works directly under the President or the Managing Director of the company. Besides routine work he keeps the Board of Directors informed about all the phases of business activity, including economic, social and political developments affecting the business behaviour. He also furnishes information about the financial status of the company by reviewing from time to time. The CFO may have different officers under him to carry out his functions. Broadly, the functions are divided into two parts. (i) Treasury function (ii) Control function Treasury function (headed by financial manager) is commonly responsible for handling financial activities, such as financial planning and fund raising, making capital expenditures decisions, managing cash, managing credit activities, managing the pension fund and managing foreign exchange. The control function (headed by Chief Accountant / Financial Controller) typically handles the accounting activities such as corporate accounting, tax management, financial accounting and cost accounting. The treasurer’s focus tends to be more external, the controllers focus more internal: BOARD OF DIRECTORS Managing Director/President V. P ProductionV. P FinanceV. P Sales Treasurer Controller Credit Cash Banking PortfolioCorporate Taxes Internal Budgeting Management Management Relation ManagementGeneral Audit Accounting Cost Accounting Fig 1. 1 Organization chart of finance function Relationship of field of finance with economics – The field of finance is closely related to economics. Financial managers must understand the economic framework and be alert to the consequences of varying levels of economic activity and changes in economic policy. They must be able to use economic theories as guidance for efficient business operation. Examples include supply-demand analysis, profit-maximizing strategies, and price theory. The primary economic principle used in managerial function is marginal analysis, the principle that financial decisions should be made and actions taken only when the added benefits exceed the added costs. Nearly all-financial decisions ultimately come down to an assessment of their marginal benefits and marginal costs. Relationship to Accounting – The firm’s finance (treasurer) and accounting (controller) activities are closely related and generally overlap. Normally managerial finance and accounting are not often easily distinguishable. In small firms the Controller often carries out the finance function and in large firms many accountants are also involved in various finance activities. There are two basic differences between finance and accounting: i) Emphasis on cash flows: The accountant’s primary function is to develop and report data for measuring the performance of the firm, assuming its financial position and paying taxes using certain standardized and generally accepted principles. The accountant prepares financial statements based on accrual basis. The financial manager places primary emphasis on cash flows, the inflow and outflow of cash. ii) Relating to decision-making: Accountants devote most of their operation to the collection and presentation of financial data. The primary activities of the financial manager in addition to ongoing involvement in financial analysis and planning are making investment decisions and making financing decisions. Investment decisions determine both the mix and the type of assets held by the firm. Financing decisions determine both the mix and the type of financing used by the firm. However the decisions are actually made on the basis of cash flow effects on the overall value of the firm. Interface with other Functions Finance is defined as the lifeblood of an organization. It is a common thread, which binds all the organizational functions as each function when carried out creates financial implications. The interface between finance and other functions can be described as follows: Manufacturing Finance i) Manufacturing function necessitates a large investment. Productive use of resources ensures a cost advantage for the firm. i) Optimum investment in inventories improves profit margin. iii) Many parameters of the production cost having effect on production cost are possible to control through internal management thus improving profits. iv) Important production decisions like make or buy can be taken only after financial implications have been considered. Marketing Finance – i) Many aspects of marketing management have financial implications e. g. hol d inventories to provide off the shelf service to customers and thus increase sales; extension of credit facility to customers to increase sales. i) Marketing strategies to increase sales have additional cost impact, which needs to be weighed carefully against incremental revenue. Personnel Finance – In the global competitive scenario business firms are moving to leaner and flat organizations. Investments in Human Resource Development are also bound to increase. Restructuring of remuneration structure, voluntary retirement schemes, sweat equity etc. have become major financial decisions in the area of human resource management. Strategic Planning – Finance – Finance function is an important tool in the hands of management for strategic planning and control on two counts – i) The decision variables when converted into monetary terms are easier to grasp. ii) Finance function has strong inter-linkages with other functions. Controlling other functions through finance route is possible. Methods and Tools of Financial Management – i) In the area of Financing – Funds are procured from long-term sources as well as short-term sources. Long-term funds may be made available by owners, i. e. hareholders, lenders through issue of debentures / bonds, from financial institutions, banks and public at large. Short-term funds may be procured from commercial banks, suppliers of goods, public deposits etc. The finance manager has to decide on optimum capital structure with a view to maximize shareholder’s wealth. Financial leverage or trading on equity is an important method by which return to shareholders can be increased. ii) F or evaluating capital expenditure (investment) decisions, a finance manager uses various methods such as average rate of return, payback, internal rate of return, net present value and profitability index. ii) In the area of working capital management there are various methods for efficient utilization of current resources at the disposal of the firm, thus increasing profitability. The centralized method of cash management is considered a better method of managing liquid resources of the firm. iv) In the area of dividend decision, a firm is faced with the problem of declaring dividend or postponing dividend declaration, a problem of internal financing. There are tools to tackle such situation. v) For the evaluation of a firm’s performance there are different methods. For example, ratio analysis is a popular technique to evaluate different aspects of a firm. vi) The main concern of the finance manager is to provide adequate funds from the best possible source, at the right time and the minimum cost and to ensure that the funds so acquired are put to best possible use through various methods / techniques are used to determine that funds have been procured from the best possible available services and the funds have been used in the best possible way: Funds flow and cash flow statements and projected financial statements help a lot in this regard. The changing role of Financial Management in India – Modern Financial Management has come a long way from the traditional corporate finance. The finance Manager is working in a challenging environment, which changes continuously. As the economy is opening up and global resources are being tapped, the opportunities available to finance manager have no limits. At the same time one must understand the risk in the decisions. Financial management is passing through an area of experimentation and excitement, as a large part of the finance activities carried out today were not heard a few years ago. A few instances are enumerated below: i) Interest rates have been deregulated, further interest rates are fluctuating, and minimum cost of capital necessitates anticipating interest rate movements. ii) Rupee has become freely convertible in current account. iii) Optimum debt equity mix is possible. The firms have to take advantage of the financial leverage to increase the shareholders wealth. However financial leverage entails financial risk. Hence a correct trade off between risk and improved rate of return to shareholders is a challenging task. v) With free pricing of issues, the optimum price of new issue is a challenging task, as overpricing results in under subscription and loss of investor confidence whereas under pricing leads to unwarranted increase in number of shares and also reduction of earnings per share. v) Maintaining share prices is crucial. In the liberalized scenario the capital markets is the important avenue of funds for business. The dividend and bonus policies framed, has a direct bearing on the share prices. i) Ensuring management control is vital especially in the light of foreign participation in equity (which is backed by huge resources) making the firm an easy takeover target. Existing managements may loose control in the eventuality of being unable to take up the share entitlements. Financial strategies to prevent this are vital to the present management. Forms of Business Organization – The three most common forms of business organization are the sole proprietorship, the partnership and the company. Other specialized forms of business organizations also exist. Sole proprietorship are the most In terms of total receipts and net profits corporate form of business dominate. Sole Proprietorship – A sole proprietorship is a business owned by one person who runs for his own profit. Majority of the business firms are sole proprietorships. The typical sole proprietorship is a small business e. g. bakeshop, personal trainer or plumber. The majority of sole proprietorship is found in the wholesale, retail, service and construction industries. Typically, the proprietor along with few employees runs the business. He raises capital from personal resources or by borrowing and is responsible for all business decisions. The sole proprietor has unlimited liability, towards creditors not restricted to the amount originally invested. The key strengths and weaknesses of sole proprietorship are given in table 1. 3. Partnership – A partnership firm is a business run by two or more persons for profit. Partnership accounts for the next majority of business and they are typically larger than sole proprietorship. Finance, legal and real estate firms often have large number of partners. Most partnerships are established by a written contract known as ‘Deed of Partnership’. In partnership, all partners have unlimited liability for all the debts of the partnership. In India, partnership is governed by the Partnership Act, 1932. Strengths and weaknesses or partnerships are summarized in Table 1. 3. Company Form – A company form of business is a legal entity, separated from the owners, with perpetual succession. Just like an individual, the company can sue and be sued, make and be party to contracts and acquire property in its own name. The company form of organization is the dominant form of business organization in terms of receipts and profits. Although, corporations are involved in all types of business, manufacturing corporation account for the largest portion of corporate business receipts and net profits. The key strengths and weaknesses of corporate form are summarized in Table 1. 3. The owners of the company are its shareholders, whose ownership is evidenced by either common shares or preference shares. Shareholders get a return by receiving dividends i. e. periodic distribution of earnings or gains through increase in share price. Owner’s liability is limited to the amount paid on their shares. Shareholder elects the Board of Directors through vote. The Board of Directors has the ultimate authority in running the organization including making the general policy. The President or Chief Executive Office (CEO) is responsible for managing day to day operations and carrying out the policies established by the Board. The CEO is required to report periodically to the firm’s board of directors. The corporate form of business are subject to strict control by Regulatory Agencies including Companies Ac, 1956, SEBI, etc. Table I Strengths and weaknesses of the common forms of business organizations Sole Proprietorship |Partnership |Company | | | | | |Strengths | | | | | | | |Owners receive all profits and incurs all losses |Can raise more funds than the sole proprietorship |Owners liability is limited to the extent paid on | | |their shares | |Low organizational costs |Borrowing powers enhanced by more owners | | | | |Can achieve large size via sale of shares | | |More available manpower and managerial skill | | |Income is included and taxed on owners personal tax | |Ownership (share) is readily transferable | |return |Income included and mixed on individual partner’s tax | | | |return |Long life of the firm | |Independence | | | | | |Can have professional managers | |Secrecy | | | | | |Has better access to financing | |Ease of dissolution | | | | | |Receives some tax advantage | | | | | | | | | |Weaknesses – |Owners have unlimited liability and may have to cover | | | |debts of other partners |Taxes generally higher, because corporate income is | |Owner has unlimited liability towards debt of the firm| |taxed and dividends paid to owners are also taxed. | |Partnership is dissolved when partner dies |(the latter has been exempted at the hands of the | |Limited fund raising power limits growth | |shareholders in India) | | |Difficult to liquidate or transfer partnership | | |Proprietor must be jack-of-all trades | |More expensive to organize than other forms of | | | |business | |Difficult to give employees long-run career | | | |opportunities | |Subject to greater control by regulating authorities | | | | | |Lacks continuity when proprietor dies or unable to | |Lacks secrecy since the shareholders must receive | |operate | |financial reports at periodic intervals | | | | | Limited Liability Partnership A limited liability partnership (LLP) is a partnership in which some or all partners (depending on the jurisdiction) have limited liability. It therefore exhibits elements of partnerships and corporations. In an LLP, one partner is not responsible or liable for another partners misconduct or negligence. This is an important difference from that of an unlimited partnership. In an LLP, some partners have a form of limited liability similar to that of the shareholders of a corporation. In some countries, an LLP must also have at least one general partner with unlimited liability. Unlike corporate shareholders, the partners have the right to manage the business directly. In contrast, corporate shareholders have to elect a board of directors under the laws of various state charters. The board organizes itself (also under the laws of the various state charters) and hires corporate officers who then have as corporate individuals the legal responsibility to manage the corporation in the corporations best interest. An LLP also contains a different level of tax liability from that of a corporation. Limited liability partnerships are distinct from limited partnerships in some countries, which may allow all LLP partners to have limited liability, while a limited partnership may require at least one unlimited partner and allow others to assume the role of a passive and limited liability investor. As a result, in these countries, the LLP is more suited for businesses where all investors wish to take an active role in management. There is considerable confusion between LLPs as constituted in the U. S. nd that introduced in the UK in 2001 and adopted elsewhere  Ã¢â‚¬â€ see below  Ã¢â‚¬â€ since the UK LLP is, despite the name, specifically legislated as a Corporate bo dy rather than a Partnership. India The Limited Liability Partnership Act 2008 was published in the official Gazette of India on January 9, 2009 and has been notified with effect from 31 March 2009. However, the Act, has been notified with limited sections only. The rules have been notified in the official gazette on April 1, 2009. The first LLP was incorporated in the first week of April 2009. 1. In India, for all purposes of taxation, an LLP is treated like any other partnership firm. 2. be limited to their agreed contribution in the LLP. 3. Further, no partner would be liable on account of the independent or unauthorized actions of other partners, thus allowing individual partners to be shielded from joint liability created by another partners wrongful business decisions or misconduct. 4. LLP shall be a body corporate and a legal entity separate from its partners. It will have perpetual succession. Indian Partnership Act, 1932 shall not be applicable to LLPs and there shall not be any upper limit on number of partners in an LLP unlike an ordinary partnership firm where the maximum number of partners can not exceed 20, LLP Act makes a mandatory statement where one of the partner to the LLP should be an Indian. 5. Provisions have been made for corporate actions like mergers, amalgamations etc. 6. While enabling provisions in respect of winding up and dissolutions of LLPs have been made, detailed provisions in this regard would be provided by way of rules under the Act. 7. The Act also provides for conversion of existing partnership firm, private limited company and unlisted public company into a LLP by registering the same with the Registrar of Companies (ROC) 8. Nothing Contained in the Partnership Act 1932 shall effect an LLP. 9. The Registrar of Companies (Roc) shall register and control LLPs also. 10. The governance of LLPs shall be in electronic mode based on the successful model of the present Ministry of Corporate Affairs Portal. Chapter Assignments – 1. What are the tasks of Financial Management? 2. Discuss the salient features of the traditional approach to Corporation Finance. 3. Discuss the distinctive features of modern approach to Corporation Finance. 4. What is the normative goal of financial management? 5. â€Å"Financial Management is an integral part of the jobs of all managers. Hence it cannot be entrusted to a staff Department†. Discuss. 6. Discuss some of the problems the financial managers in a developing country like India have to grapple with. 7. Draw a typical organization chart highlighting the finance function of a company. 8. Which of the following functions should be the responsibility of a Finance Manager? i) Maintaining the books of account. ii) Negotiating loans with banks iii) Preparation of cost statements iv) Conducting of internal audit v) Analysis of new projects i) Ensuring that enough cash is available at all the branches and factories of the company. vii) Assisting the management in taking a decision regarding the quantum of dividend. viii) Negotiating under-writing agreements in case of new issues ix) Preparing the financi al statements. x) Deciding about change in the policies regarding recruitment. xi) Decision on administrative practices. xii) Change in marketing and advertising techniques routine. 9. Which of the following statements are true? i) It is the job of the finance manager to approve all payments. ii) The finance manager has to keep a proper balance in the procurement and use of funds. iii) Acquisition of fixed assets is of no concern to the finance manager. v) It is always advisable to distribute the total amount of profit as dividend. v) Since it is crucial that all sections of the business have adequate cash, it is a good policy to give each sections of the business double the amount of cash that they normally require so that they can meet even emergencies. vi) Debentures and loans from financial institutions are very important sources of long-term funds. vii) It is better if no credits are given to the customers since this would mean that no amounts are tied up in sundry creditors. v iii) In a period of rising prices, it is better to stock as much as raw material as possible, irrespective of the cost of procuring funds. x) A proper capitalization ensures that there is a balance between long-term funds and short-term funds and also proper ratios are maintained between the various sources of funds. 10. Which of the following statements do you agree? i) Financial management is essential only in private sector enterprise. ii) Only capitalists have to bother about money. The bureaucrat is to administer and not manage funds. iii) The public administrators in our country must be given a basic understanding of essentials of finance. iv) A state owned Transport Company must immediately deposit in the bank all its takings. v) â€Å"Financial Management is counting pennies. We do not believe in such miserly attitude†. vi) â€Å"Finance function is important as any other function in an organization†.