Juror Organised Highly Conscientious Philosophy Essay

Juror Organised Highly Conscientious Philosophy Essay 12 Angry Men is a story of 12 juries making decision for a boy who have been accused for murdering his own father. A jury not only symbolizes democracy, but also embodies important cultural values which teamwork. The movie, 12 Angry Men clearly depicts how a random group of people can come together for a common goal, and in this case specifically to reach a final verdict. Each member possesses specific personality traits and diverse backgrounds that affect the decision making process. In the beginning, eleven juries out of twelve voted guilty. Only Juror No.8 voted the boy is not guilty. Juror 8 thought that they should re-examine the evidences again and not simply make decision on the boys life within five minutes. All of them agreed to speak out their opinions about the case. Most of them voted guilty based on the evidences and testimonials by the witnesses. 2.0 Personalities According to the Gordon Allport, personality is the dynamic organization within the individual of those psychological systems that determine his unique adjustment to his environment In other words, the ways in which a person reacts or interacts with others. Actually, it is the mixture of characteristics or traits that form a persons character and makes the person unique from another. In the movie 12 Angry Men the twelve juries got twelve different personalities. Hence, by using the personality traits models, like Big Five Model we have analyzed what kind of personalities they fall into. 2.1 Juror#1- Responsible, Conscientiousness Firstly, Juror #1 was the leader (foreman) of the twelve jury board. Throughout the discussion on whether the boy who was accused as a murderer of his father is guilty or not, he acted as a responsible leader. We discover that he handled situation in an organized way, for example- at start he suggested everyone to sit by their numbers and after that when everyone was settled on their seats he explained what they are supposed to do, and also when Juror#12 was distracted from his responsibility as a juror, Juror#1 reminded him his reason to be in the juror board. So, this proves that he has high conscientiousness. Furthermore, his agreeableness is also quite high as he considered others opinion about voting at first and keeping everyones view in front according to jury numbers and so on. In addition, his emotional stability is high, he was calm throughout the discussion even when 10th Juror questioned his leadership by asking him to stop treating them as kids, he did not raise his voic e too much but he just offered Juror#10 to take over his position. 2.2 Juror#2- Mild Openness to Idea It was the first time as a juror for Juror#2, so he was at first clueless about how thing works in a juror discussion. He was not very comfortable to voice out his ideas about why he thinks the boy is guilty, he just believes the evidences and the words he heard from the case. It gives the idea that his openness to new things is not high; he is not autonomous when taking decision. But he got more involved as the discussion goes on after a while and when the Juror#8 was showing out his doubt about the truth of the evidence, Juror#2 took notice of the logic behind the doubts and eventually supported Juror#8. 2.3 Juror#3- Stubborn Next, Juror#3 was the one who changed his vote to not guilty in the end. His stubbornness made him stick towards voting guilty throughout the discussion. He did not want to listen to any opinion other than his; he also denied the facts that make the evidences doubtful, this makes him low on agreeableness. Furthermore, he is low on conscientiousness as he did not feel responsible for the boys life, he thought that the courtroom was sleepy, people are talking too much when the case was obvious, and it is just a waste of time and money for him, even when the Juror#8 was giving out his view instead of listening carefully why Juror#8 thought the boy might not be guilty Juror#3 was playing with Juror#12. Next, he also lost his temper when Juror#8 was convincing others with his reasons of having doubt on the evidences and the number of vote for not guilty was increasing, he yelled at those who changed their mind, he was emotionally unstable. 2.4 Juror#4- Organised, Highly Conscientious Now, we move to Juror#4. He gives an impression of a very professional and organized person because he supported his view about the boy being guilty with facts and logic, without simply just saying guilty because the court said so. Despite that, he is highly conscientious as he took his duty as juror seriously. He was emotionally stable and opens to others opinion. He was not influenced by others, when making decisions he was independent, rational and calm. He changed his vote only after Juror#8 and Juror#9 gave him enough evidence (e.g. remembering the movie name, marks of spectacles on the womans nose) to doubt his decision over the kid as the murderer. However, at the beginning of the discussion he showed a little negative thinking about the slum and the people who live there by saying He was born in a slum. Slums are breeding grounds for criminals, I know as a view its no secret. 2.5 Juror#5- Introvert Next, Juror#5 shared the same background in terms of environment and culture in which, the boy who was accused to be murderer grew up. He was not comfortable to judge the boy and also did not want to give reason behind his vote at first. He showed the symptoms of an introvert person. Later on when he connected the evidence with his own experience and when he was offended by having a background that was born in a slum, he changed his vote to not guilty. 2.6 Juror#6- Simple When we come to Juror#6, we can know that he was a simple man. When it was his time to give his opinion on the cause of voting guilty he simply said there was a motive like every murder case and the picture presented in the court makes it obvious that the boy killed his father, he could not argue with the fact Juror#8 brought in front of him then. He just agrees with the court decision. He never became hyper throughout the meeting; he tried to stop whenever people got into fight just like Juror#4. In the movie we could also see his feeling of responsibility towards the old man. 2.7 Juror#7- Irresponsible, Irrational We realized that Juror#7 was the most irresponsible and irrational. He wanted the discussion to finish as fast as possible so that he could go to watch a baseball match. To him, the life of a person was like a child play to him. He did not fulfill his responsibility as a jury which makes him low on conscientiousness. He related the boys past offences to judge him as guilty. 2.8 Juror#8- High in conscientiousness, Emotionally Stable Next, Juror#8 is the most important character in the story, because of him everybody started to think the case from a what if situation. He felt responsible for the boys life, he presented his opinion with logic, he thought about the reliability of the evidence presented in the court, he put a lot of effort to show the leaks in the evidences (e.g. the knife, the old man testimony about seeing the boy running down the stairs, women who saw the murder from a moving train). This proves he is high on conscientiousness. He was emotionally stable even though he was frequently questioned about his decision. Just once he lost temper for a bit because Juror#3 was not paying attention to his talk. 2.9 Juror#9- Old, Timid, Low Confidence Level The negative personalities can be detected through Juror#9. He is very old and afraid to voice out his thought. His confidence level is low as he does not have the strength to argue with the other juries who were younger than him. He was threatened by Juror#10. At a point of time he wished he was younger to voice out his argument. However, he is a very good observer. He was the second not guilty voter. He changed his vote when he saw Juror#8s view connects with his observation. His observing quality supported Juror#8s doubt about the evidences throughout. His decision making was based on intuition where he himself also not sure whether the story told by the defendant was true or not. He just thinks that they need to discuss further before sending the defendant for the execution. 2.10 Juror#10- Hyper, Emotionally Unstable The most emotional character was Juror#10 as he was the most hyper, emotionally unstable person in the group. He did not want to hear any argument that contradicts with his opinion about the boy, he shouted, yelled at those who thought the boy was not guilty. His judgment was discriminative. He referred the boy as trash, animals, drugged up person who do not care about peoples life and kill them without having any proper reason; he is just like other people who grow up in the slum. 2.11 Juror#11- Introvert In contrast to Juror#10, Juror#11 has an introvert personality. He was not noticeable at the beginning of the movie. During the time of voting he raised up his hand with some hesitation after seeing the majority were raising hands to vote as guilty. At first he observed Juror#8, Juror#9 and Juror#5s logic in voting not guilty then he changed his vote and started to share his opinion. He was open towards the facts presented by Juror#8, 9 and 10. Although he was calm all the way but when Juror#7 changed his vote to not guilty without giving any proper reason he burst out in anger seeing that childishness over a serious matter. This also shows that Juror#11 is conscientious. 2.12 Juror#12- Extrovert Lastly, Juror#12 at the beginning tried to interact with other juries; it shows that he is an extrovert. But when the discussion started he did not expressed much, instead he was carried away with his own personal job. His agreeableness level was high. He did not have his own thinking or opinion on the case; he was easily distracted by the two parties (guilty and not guilty) in the discussion. When majority vote for guilty, then he raises his hand. He was unsure about his own decision. This decision making may be affected by his high agreeableness personalities that caused him to listen, or even follow others opinion without own judgment. 3.0Values Actually, values were developed from a belief that people hold in. Hence, value is defined as specific mode of conduct or end-state of existence is personally or socially preferable to an opposite or converse mode of conduct or end-state of existence. Normally, they contain a judgmental element in that they carry an individuals ideas as to what is right, good, or desirable. We realize values are important in this movie because they contain jurors interpretations of right and wrong. We will classify and interpret the values found in each characters of 12 Angry Mens using Rokeach Value Survey which is consists of terminal values and instrumental values. 3.1 Juror#1-Equal Opportunity As we know, foreman should be fairer and stress on equality. Juror#1 is the foreman of the jury. He has terminal value of equality which is equal opportunity for all juries to vote. He is serious about his authoritative role and wants to be as fair as possible to everyone. He offers everyone an equal opportunity to vote and speak out their opinion whether the boy guilty or not guilty. He also has instrumental values of broad-minded. He is open-minded in listening and accepting every jurors opinion. For instance, he accepted the proposal of Juror#8 to have a round of secret vote. His broad-minded values also affected his decision making. He vote for guilty at first, but with the reasonable doubt with all the evidence, he shift to not guilty at last. His decision making was quiet rational and did not shift too often as what Juror#12 did. 3.2 Juror#2-Polite Juror#2 is a quiet man who is easily persuaded by the opinions of others and cannot explain the roots of his opinions. He has instrumental values of polite. He is trying to voice out his own opinion with polite way. His politeness can be seen through the discussion process where he kept one asking question in a polite manner and gain respect from other Jurors. 3.3 Juror#3- Capable, Courageous Now we move to another instrumental value, which are capable and courageous. Juror#3 has instrumental values of capable and courageous. He stands up for his belief that the boy is guilty based on the facts such as the switchblade used as the murder weapon and evidence from the witness. However, his strong belief on the defendant must guilty was also influenced by his bad relationship with his son who hit and left him, which thus lead him to be irrational in analyzing the reasonable doubt for those evidences and decisions made. 3.4 Juror#4-Logical, Broad-Minded Juror#4 has instrumental values of logical and broad-minded. He logically related his decision with the evidences. On the other hand, he is also able to listen to other juries opinion. He was convinced by Juror#9 that the witness across the road may not really see what is happening at the murder place. He tries to support his own decision by further analysis of the facts with logical ways. 3.5 Juror#5-Forgiving, Logical Next, we can find instrumental value of forgiving on Juror#5. Although he got offended when Juror#3 and Juror#10 criticizing him on his background, however he is still willing to forgive them. Witnessing knife fights and normal slum behaviour, he feels obligated to explain an experience that would later help the jurors vote not guilty. The ability to link his experience of knife fights and normal slum behaviour to this case whereby the defendant is also from slum shows that Juror#5 has instrumental value of intelligence in his thinking. 3.6 Juror#6-Respect, Loving Now let us move to Juror#6 who has terminal values of respect and instrumental values of loving. He respects Juror#9 which is the eldest among them. He tries to let Juror#9 has the chance to voice out his opinion. Juror#6 bravely stands up to Juror #3 when he speaks rudely to Juror #9, threatening to hit Juror #3 if he ever speaks to the old man like that again. 3.7 Juror#7-Pleasure, Cheerful Meanwhile, terminal values of pleasure and instrumental values of cheerful are clearly shown on Juror#7. He is a baseball fan. He bought two tickets to watch live baseball game on that particular day. During the break time of the discussion, everyone was tensed with how things going to be as a jury, but he still could talk with others cheerfully. 3.8 Juror#8-Logical, Responsible Juror#8 has instrumental values of logical and responsible. He does not believe the evidence that presented by lawyer. He analyzed evidence by using logic. For instance, he questioned on the old man who claimed himself had taken fifteen seconds from his bedroom to rush to his front door and gotten a look on the murderer. He does not simply make a decision that may destroy the boys life. He feels that as one of the Juror, he has the responsibility to make a right decision. This is clearly shown when he first voted not guilty because he wants further discussion and not to decide the defendants life just within five minutes without any further discussion. Majority were trying to give some pressure to the Juror#8 for his odd decision. But the pressure could not shake off his decision; he stood strong with his own decision which was affected by his values. 3.9 Juror#9-Intellectual, Logical Follow with Juror#9 who has instrumental values of intellectual and logical. Although he is the eldest among them still he paid a lot of attention during the trial and looked into detailed on every witness. He convinced Juror#4 on the reasonable doubt on the woman has deep marks on her nose, which means she is wearing spectacles and might not be able to see clearly on the murder case that happened across the road with train passed by and just got up from bed which is not putting on her spectacles. This shows how he used his intelligence and observance in daily life in this case. 3.10 Juror#10-Courageous Next, Juror#10 has instrumental value of courageous. He is standing up for his belief that with the background of the boy comes from, which is born in a slum, the boy must be guilty. This has become his prejudice which caused him fail to think and decide rationally on whether the boy is guilty or not. Besides that, Juror#10 also has terminal value of self-respect. He holds very high esteem not to be someone from the slums. Juror#10s decision making was affected by his perceptions towards the background of the defendant which occurred from his self-esteem values that want to be differentiated from people of that background. 3.11 Juror#11-Responsible Instrumental value of responsible can be found on Juror#11. He felt the responsibility being juror to give the correct judgment on the defendant and believe in justice. Besides that, Juror#11 also has instrumental value of logical. He is observant with the facts and changed his vote to not guilty due to the doubt on whether the defendant would have reasonably fled the scene and come back three hours later to retrieve his knife. His decision is based on logical thinking about how a normal people might act after committing a murder. 3.12 Juror#12-An Exciting Life Lastly, Juror#12 has terminal value of having an exciting life. He involves actively in social activities and his work. However, this has caused him often distracted during the discussion of the jury. 4.0 Attitude Attitudes are evaluative statements or judgments concerning objects, people, or events. Attitudes give warnings of potential problems and influence behavior. Attitudes have three components which are cognitive (evaluation), affective (feeling), and behavioral (action). In this movie, most of the jurors have a positive attitude that the boy is guilty. They believe that the evidences are solid, which is the cognitive component for their attitude. Following with this, the affective component of their behaviour were set up whereby they feel the boy is guilty. Subsequently, it affected their behaviour component and they voted the boy is guilty. Conversely, Juror#8 has a different attitude compared to other Juries. He thinks there are a lot of reasonable doubts in the evidences yet no one questioned the validity of those evidences in the court. This has become the cognitive component for his negative attitude towards the boy is guilty. He feels that the boy might not be guilty, which is the affective component of his attitude. Because of this, he voted the boy as not guilty and wants to have a discussion with other jurors on the evidences. 5.0 Emotion and Mood After discussing the personality and values depicted by the 12 Angry Men, emotion and moods are two other important variables that affect decision making process. Actually, emotions are intense feelings directed at someone or something while moods are less intense feelings than emotions and often lack a contextual stimulus. In addition, emotions are reactions to a person or an event but moods usually are not directed at a person or an event (Robbins, S.P. Judge, T.A. (2013) Organizational Behavior). In 12 Angry Men movie, decisions making of 12 juries whether that young boy guilty or not guilty are always affected by their emotions and moods. Thus, having a stable emotion is necessary for them to make a rational decision. 5.1 Juror#1- Mood: Neutral to Bad; Emotion: Frustration Juror#1 is the foreman of the jury and he shows his leadership at first and neutral mood. However, he gets frustrated when other jurors questioned his leadership. He wants to be as fair as possible and try to maintain a relaxed and calm mood when discussion is going on. Luckily, he was able to regulate back his emotion to normal state and facilitate the discussion at the mid. 5.2 Juror#2- Mood: Anxious; Emotion: Nervous On the other hand, Juror#2 is a quiet and the most timid guy in the group. Having his first time to deliberate in such jury case made him anxious and fear to voice out his opinion. He was easily persuaded by other jurors due to his lack of self confidence. Besides, he also failed to explain the roots of his opinion that grounded his decision at the beginning. However, his courage to voice out his opinion has been mounting as the discussion goes further. 5.3 Juror#3- Mood: Bad; Emotion: Angry Let us move to the main antagonist of the movie, Juror#3. Juror#3 is a person who quick to lose his temper. His was having a bad mood since the beginning when he complains on the lawyers talked for so long even on such an obvious case. He gets angry when Juror#8 and other members disagree with his opinions, and his anger becomes stronger when other jurors change their vote from guilty to not guilty. He believes that the defendant is absolutely guilty until the very end of the play. His emotion gets affected in this case because he has poor relationship with his own son, which causes him to have biased views. Being in angry emotion and biased views has caused him irrational in making decision on guilty and not guilty for the defendant until the very end of the movie. His decision making was based on his own experience that does not related much to the trial. 5.4 Juror#4- Mood: Neutral; Emotion: Calm We realize that Juror#4 is a logical and well-spoken stockbroker. Being rational while maintaining his calm mood allowed him to have the most stable emotion throughout the discussion and able to discuss and make decisions rationally. For instance, he urges fellow jurors to avoid emotional arguments and engage in rational discussion. When one of the jurors says this is not an exact science, he does not take into account the feelings, the passions and the characters of the people involved in the case. Other than that, most of the jurors mood has been affected and they got frustrated easily as they were staying in a no air-conditioned room in a hot sunny day. Yet, under this hot environment, he is the only juror that does not take his jacket off and always adapt for logical thinking and able to make reasonable decision. 5.5 Juror#5- Mood: Anxious to Neutral; Emotion: Nervous Next, Juror#5 has an anxious mood when expressing his opinion especially in front of the elder members of the group. He is under emotional stress because of having the same background with the boy which is growing up in the slums. This appears one of the main reasons for him voting guilty at first because he does not want compassion to influence his decision. However as the trial goes on he is able to gain more confident to voice out his opinion and sharing his experience on knife fights and normal slum behaviour that convinced other jurors there is reasonable doubt on the evidences. This makes him emotionally more stable and his mood also back to neutral. Juror#5s decision was affected by his emotion whereby at first he passes his chance to give reason why he voted guilty for the trial which maybe feeling of ashamed for having the same background with the defendant that is living in slum, uneducated and bad environmental where knife fighting was just a common phenomena. 5.6 Juror#6- Mood: A little tensed; Emotion: Calm Juror#6 is a regular employee that has high agreeableness to others. He has little tense mood because of everyone in the room is better qualified than him in making decisions and offering explanations and opinions. However he has a stable emotion that enables him to see the good in others. 5.7 Juror#7- Mood: Good to Bad; Emotion: Frustration Juror#7 is the only one that really has no opinion on this case. This can be shown by when he follows others suggestion and changes his vote easily just because he wants to go back home early. One of the sources of emotions and mood which is social activities has influenced his mood throughout the discussion. He felt happy at the beginning as he could go to watch live baseball game. However, his mood turned down and get frustrated when the discussion takes longer. His emotion and decision making was distracted by the baseball game as he wanted to speed things up a bit so he can be out of the jury room as soon as possible to enjoy his baseball game. 5.8 Juror#8- Mood: Neutral to Good; Emotion: Determined and Calm In contrast to Juror#7, Juror#8 stands firm on his decision grounded with his reasonable doubt on the evidences. Juror#8 is a caring man and he feels the responsibility to care about the boys life. Maintaining a stable emotion enables Juror#8 have a logical mind and able to make a rational decision. He has put more thoughts into the case than any other jurors which make him able to prove and explain the situation in different ways to persuade other jurors change their vote. For example, he bought the same knife used as murder weapon that is not ordinary and tried to prove the reasonable doubts on those witnesses such as the old man who drags one foot when he walks because of stroke, able to rush to the front door from his bedroom which is quite distance away in fifteen seconds and managed to look on the murderer. Juror#8 also has high emotional intelligence in this movie that he always shows the right feeling and knows how to control his own emotion even every other juror has voted g uilty but he is the only one to vote not guilty at the first. Besides that, Juror#8 urges others to be patience with the discussion and contemplate the details of the case. 5.9 Juror#9- Mood: Neutral; Emotion: Calm Next, Juror#9 is a wise old man with his great life experience and he has quite a unique way of looking at this case. His calm and relaxed mood allows him to think logically and be a good observer. He is the first one who realizes the woman, who testified that she saw the murder, had deep marks on the side of her nose and it means she wears glasses. This has put on reasonable doubt that the woman who just got out from bed may not wearing glasses, and thus it is likely for her not able to see clearly the murder across the road. He has high positive mood which is alert. For instance, he is the first to openly recognize Juror#10s racist attitude, stating that What this man says is very dangerous. 5.10 Juror#10- Mood: Bad; Emotion: Angry Let us proceed to Juror#10. Juror#10 is the most horrifying character in this movie. He tries to force his opinion of guilty to other jurors and gets angry easily when other jurors opinion is not same with him. He votes guilty and does not even try to hide the fact that he does so because of the boys social background. He has a strong stereotyping attitude and this stopped him to think rationally and voted the boy guilty just because of the boys background. This has lead to other jurors turning their back on him near the end of the movie after his outburst that shows his prejudice on the defendant. 5.11 Juror#11- Mood: Neutral; Emotion: Calm When we come to Juror#11, we know that he is an immigrant watchmaker. He believes in justice and feels he is responsible to make the correct judgment for the case. He tries to keep himself calm and relaxed throughout the discussion. This stable emotion allows him able to look at both sides of the problem. However, Juror#11 lost his temper once when he was horrified by juror#7 who voted not guilty just because want to make the trial ends as soon as possible. 5.12 Juror#12- Mood: Anxious; Emotion: Nervous Eventually, Juror#12 is an arrogant and impatient advertising executive. He has an anxious mood for the discussion to be over so that he can get back to his career and his social life. His decision gets affected by his nervous mood. This can be shown by when he change his vote easily just to follow majority and do not have his own opinion. 6.0 Other Variables That Affects Decision Making Process 6.1 Hot Environment Besides the abovementioned variables like personality, values, attitudes, emotions and moods, external factor do affect the decision making process also. One of the most prominent external factors is the environment for the discussion room. When all the jurors entered the discussion room, they found that the room was hot due to the breakdown of the air-conditioner. As a result, all the jurors just kept on finding ways to make the rooms more ventilated instead of seeking for discussion. So, the morale of all jurors has been lowered down by the hot and non-conducive environment and affects the discussion process. Definitely, they would just hope that the discussion may be ended up quickly and this drives them to make illogical decision. 6.2 Stereotype Next, the shortcut of stereotyping people used by the eleven jurors except Juror #8 in judging the suspected murderer will affect the decision making process too. Juror #3 has related his son with the suspected murder attitude. In fact, the Juror#3 did not get along with the suspected murderer attitude. He said that How kids are nowadays. He mentioned that he had a bad relationship with his son after his son hit him. Following his bad experiences, Juror#3 perceived that all teenagers were rebellious and will attack his own father. So, his stereotyping attitude has affected his decision making process and made him stressing that The boy is guilty. Another prominent stereotyping judgment can be discovered through the accusation of Juror#10 that the boy was deemed to be guilty was due to his family background. He cited that the suspected murders slum background as the evidence for him to kill his father. Undoubtedly, this stereotyping attitude will affect their decision making especiall y Juror#3 and Juror#5 and vote the boy to be guilty. 6.3 Bounded Rationality and positive Intuition Apart from those discussed variables, Juror#8 has exhibited the positive elements in making rational decision. The positive elements are bounded rationality and positive intuition. Juror#8 has constructed simplified models model that extract the essential features from problems without capturing the complexities. For example, Juror#8 has questioned about the validity of the old mans testimonial. Hence, he extracted the essential features that Can the old man who had suffered a stroke and could only walk slowly, gotten to the door to see the suspected murderer ran to the downstairs in fifteen second? in a clear manner. Furthermore, the Juror#8 also has portrayed positive intuition that mentioned that he felt the boy will not kill his father and there is a doubt about the validity of the witnesss testimonial. He once told other Juror You dont believe the boy, then why you believe the women? 6.4 Overconfidence bias However, there are several decision biases and errors happened throughout the hot discussion among those 12 angry Jurors. The first common bias shown by majority of Jurors except 8th Juror is overconfidence bias. This can be evidence through the opening of the scene where majority of the Jurors were complaining and presuming the obvious guilt of the suspected murderer. Most of them were overconfidence that the defendant had definitely killed his father. Besides that, when there was a new doubt arose like switchable knife that was not as unique as the Juror mention, most of them just upset that they were still arguing the facts and cannot go home. Hence, their overconfidence about defendant was the murderer causes them could not have a rational discussion and develop reasonable doubt. Luckily, there was 8th Juror tried to lead the team to the rational path. 6.5 Anchoring Bias Furthermore, we can detect numerals biases rooted in the mind of the Juror#3. Fro

Propaganda Theories and Models: The MH370 Incident

Propaganda Theories and Models: The MH370 Incident PROPAGANDA THEORY ON THE MH370 INCIDENT Contents (Jump to) INTRODUCTION PROPAGANDA THEORY RELATING TO MH370 INCIDENT COUNTER PROPAGANDA BY THE GOVERNMENT REFERENCES INTRODUCTION Mystery continues to surround the fate of Malaysia Airlines flight MH370, which disappeared en route from Kuala Lumpur to Beijing on 8 March. Malaysian authorities, assisted by international aviation and satellite experts, are now battling to piece together the planes final hours in the hope that they can find its wreckage and explain what happened to its 239 passengers and crew. Some preliminary details were released on 1 May in a short report. Accordingly, many propaganda arises on this issue. Some of propaganda emanating from the local media and not to forget from abroad. If we look from the point of propaganda theory itself, there is some good propaganda that led to the issue of loss MH370, but there also resulting in a negative impact on public perception towards the way the government is dealing with the issue. To deal with the propaganda that apply to this incident, we will analyze whether the form of propaganda, the propaganda perspective itself and how the government to overcome this problem. Merriam Webster Dictionary gives the definition of propaganda as ideas or statements that are often false or exaggerated and that are spread in order to help a cause, a political leader, a government, etc. the spreading of ideas, information, or rumor for the purpose of helping or injuring an institution, a cause, or a person, ideas, facts, or allegations spread deliberately to further ones cause or to damage an opposing cause; also : a public action having such an effect First introduced by Edward S. Herman and Noam Chomsky (1988), Manufacturing Consent: The Political Economy of the Mass Media, the propaganda model argues that the material news through five filters, which in turn form the audience received the news. This filter determines what is considered newsworthy events, how they are covered, where they were placed in the media and how much coverage they receive. Propaganda model of media control that was introduced by Edward. S. Herman and Noam Chomsky (1988) states how propaganda works in the media. This model tries to understand how populations are manipulated, and how social, economic, political attitudes are formed in the minds of the people through propaganda. Herman and Chomsky are mostly concentrated in the American population and the media for their research, but the theory applies universally. Propaganda model seeks to explain the behavior of the media by examining the institutional pressures that limit and influence the news content in a profit-driven system. In contrast to liberal theories that argue that journalism is defined hostility power, the propaganda model predicts that the company-owned news media will consistently produce news content that serves the interests of established power (Herman Chomsky, 1988). PROPAGANDA THEORY RELATING TO MH370 INCIDENT Among the propaganda that exists from within Malaysia itself mostly spread through social media on the internet, given the sophistication of the current information age, there are blogs and websites questioned the credibility of the government and even spread propaganda relating to this issue of MH370. Among the widely disseminated propaganda on the website saying that Malaysia experienced a bad media Especially from the Western press and especially CNN and Extension of this, of good journalistic practice for hazardous and agenda driven, further lead to more conspiracy theories especially the involvement of CNN.The Mole reproduces an article written by Matthias Chang, the profession as a lawyer, social activist, author and political analyst. He reveals how the MH370 is a multi-dimensional, and why the Zionist hands should not be overlooked. Although somewhat lengthy, is worth reading every word printed: Before proceeding with Expose of Zionist propaganda Insidious Dastardly and Israel on the Cessation of MH 370, let me take this opportunity to convey my personal condolences and that of my family to a family who loves Ones have been killed in this tragedy and we hope ur strength to overcome the disadvantage pint them.† He would also commend the Malaysian governments efforts in the SAR Mission involved 26 countries that had never happened before. Allegations of unfair and unfounded against the Malaysian government made by many people in social media who do not have a clue and or expertise to comment on the operation of the Standard and Poors scale. Another propaganda that there is involvement from the United States, which was propagated that where Maldives island Residents reported sighting of low flying jet on the morning of the planes Disappearance thats was finally Reported on twelve days after the fact. The pilot of the missing plane had a home flight simulator, Which was been Reported twelve days later to contain the landing simulation program of the Diego Garcia runway along with four other Approaches in the region. Whether any, all, or none of this information is true is still a matter of Conjecture. What Remains thats a fact is not a trace of the Malaysian 777-200ER has been found. At his daily news briefing on 3-18-14, WH spokesperson Jay Carney has denied any Involvement of the Diego Garcia facility with the Disappearance of flight MH370. In addition to conspiracy theories involving the United States, one side is highly spoken of as real mastermind behind the MH370 is a tribe of lost Jewish or Israeli. It is the act of buying and Israel has a Boeing 777 2H6 (ER) long owned Malaysian Airline (MAS). Aircraft twin MH370 has been recorded at a small airport in Tarbes-Lourdes-Pyrà ©nà ©es, France on October 4, 2013 before he was taken to Ben Gurion Airport, Tel Aviv, Israel on 4 November 2013. Understandable, MAS Boeing 777 aircraft with serial number 28 416 and registered as 9M-MRI has been sold to GA Telesis, LLC in Fort Lauderdale, Florida on October 21, 2013 before the N105GT.Pesawat registered as recorded in Tarbes Lourdes Pyrenees on October 4, 2014 before taken to Tel Aviv a month later. The question is, why would Israel want to buy and have a long plane MAS this? If referred back Israeli reactions associated loss MH370, a security expert of the country, Isaac Yeffet relate it to the theory that MH370 have been captured by the terrorists and taken to Iran to be used for a series of terror will come. Yeffet reportedly gave a statement to the Times of Israel: What happened to this aircraft, nobody knows. My guess is based upon the stolen passports, and I believe Iran was INVOLVED. They hijacked the aircraft and they landed it in a place that nobody can see or find it. (There is no case what has happened to the aircraft. Based on reported cases of stolen passports, I believe Iran is involved in this case. They had seized the plane and fly it into a place that cannot be found). Another propaganda that arises during the incident came from the opposition parties, where they claim that the incident crated by the government was to create a diversion to the voter, as coincidently at that time Kajang by-election was taking place. The propaganda was that by showing the great effort towards the search and rescue operations, the government will the heart of the voters. Actually, there was so many propaganda arises during the incident even until now, people are still fed with various elements of propaganda for the positive and negative as well. If we examine this theory from the angle of propaganda, the government should also take the opportunity by using this incident as their leverage in building up the government credibility. COUNTER PROPAGANDA BY THE GOVERNMENT According to brownpoliticalreview.org in its reports, the recent disappearance of Malaysian Airlines Flight MH370 and the resulting media spotlight has revealed Malaysia’s fundamental shortcomings and glaring political issues. While the plane’s disappearance itself is horrendous – in particular for the many families left in limbo – the Malaysian government’s handling of the situation has drawn considerable international disapproval which leads to the dissemination of the propaganda. In order to deal with the issue of propaganda in connection with the issue of MH370, the government shall be wise to use methods and tactics namely through counter propaganda. Counterpropaganda is a structure of communication consisting of method in use and messages relayed to resist propaganda which seeks to manipulate action or perspectives among a targeted audience. It is closely linked to propaganda as the two often utilize the same methods to transmit methods to a targeted audience. Counterpropaganda differs from propaganda as it is defensive and responsive to identified propaganda. in addition, counterpropaganda consists of several elements that further differentiate it from propaganda and ensure its efficiency in opposing propaganda messages. While propaganda messages may not always be straightforward, efficient counterpropaganda commonly only broadcast the truth. Without a doubt, counterpropaganda is generally understood to be the truthful, honest opposition to an adversarys propaganda. Counterpropaganda communicates honest messages for ethical and realistic reasons. Looking though reporting of the event, the government from the beginning should report the facts related to this incident. Counter propaganda elements should be applied to achieve the best effect. Reporting matters of fact, although filtered, to some extent can relieve speculations made by the public, especially from the families involved. This can create a deficiency or weakness in reporting which leads to the dissemination of wild propaganda, even more so from the opposition. References: Chomsky, Noam and Herman, Edward. (1988) Manufacturing Consent: The Political Economy of the Mass Media. New York: Pantheon Books. Cole, Robert. (1996)Propaganda in Twentieth Century War and Politics Lasswell, Harold D.. (1971)Propaganda Technique in World War I. Cambridge, Mass: The M.I.T. Press. Garth Jowett and Victoria ODonnell, Propaganda and Persuassion, 4th ed. Sage Publications, 7 Herbert Romerstein, Counterpropaganda: We Cant Do Without It,] in Waller, ed., Strategic Influence: Public Diplomacy, Counterpropaganda and Political Warfare (IWP Press, 2008), 135. [Frontpost, Nachrichten fà ¼r Deutsche Soldaten, Herausgeber: Die Amerikanischen Truppen in Westeuropa,] No. 1(March 1945), 3 in Waller, ed., Strategic Influence: Public Diplomacy, Counterpropaganda and Political Warfare (IWP Press, 2008), 144-145.

Equality by Differences Essay -- essays research papers fc

Equality by Differences   Ã‚  Ã‚  Ã‚  Ã‚  The end of the Civil War marked the destruction of the institution of slavery and thus, at least officially, the equality of all races within America. However, people used to being either slaves or masters for many years simply do not change out of their former roles overnight. In the decades following the Civil War, the legacy of slavery was very apparent, as blacks struggled with both poverty and second-class citizen status. True equality had yet been achieved. Such was the aim of writers like W.E.B Dubois and Booker T. Washington, who sought to put both level the social, political, and economic playing fields for both blacks and whites. Although both Dubois and Washington had similar ends, they disagreed on the means. Washington considered blacks’ poverty the more basic problem, claiming that once blacks could establish themselves economically within society, recognition as political and cultural equals would follow. However, Dubois took the opposite sta nce by saying that the training of blacks for economic usefulness was no better than what had occurred during slavery, and that before all else, blacks as a race must assert their unique identity and cultural integrity.   Ã‚  Ã‚  Ã‚  Ã‚  Booker T. Washington stressed in his article, â€Å"The Awakening of the Negro†, the importance of blacks being able to economically support themselves. By proving themselves as productive members of society, blacks could win the approval of whites, and slowly but surely gain recognition as equals. No longer would blacks be considered a sub-human people, but a people that white people saw as worthy of respect and admiration. By using their status as a free people to integrate themselves into the economic life of America, blacks could become the providers of many goods and necessities to whites. By becoming a vital cog in the economic machine, blacks could then become a social and political force that whites could no longer ignore or dismiss. This is the rationale for Washington as he stresses industrial training in his Tuskegee Institute: â€Å"we find that as every year we put into a Southern community colored men who can start a brick-yard, a sawmill, a tin-shop, or a printing-office, -- men who produce something that makes the white man partly dependent upon the Negro, instead of all the dependence being on the... ...p;  Ã‚  Ã‚  Ã‚  The two writers’ theories were applied in real life, as Washington set up the Tuskegee Institute to help in the economic training of black persons in the South, while Dubois formed the NAACP to organize black people as a group and race. Both Dubois and Washington had logical explanations of their positions, and the fruits of their beliefs and work are evident today, as race relations continue to improve and the drive for true equality among Americans of every color pushes forth. Works Cited Du Bois, W.E.B. â€Å"Of Our Spiritual Strivings.† Making Connections. McGraw-Hill:   Ã‚  Ã‚  Ã‚  Ã‚  Boston, 2001. Du Bois, W.E.B. â€Å"Of the Training of Black Men.† The Atlantic Monthly. 12 February 1997. . Washington, Booker T. â€Å"The Awakening of the Negro.† The Atlantic Monthly. 12 February 1997. . Washington, Booker T. â€Å"The Case of the Negro.† The Atlantic Monthly. 12 February   Ã‚  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  1997. .

The Difficulty of Teaching English :: Teaching Education

The Difficulty of Teaching English   Ã‚  Ã‚  Ã‚  Ã‚  Ã¢â‚¬Å"I decided to become a teacher because I thought that I could do it better then my teachers did. I quickly learned that teaching isn’t as easy as I thought it would be.† Dr. Proser quickly learned that teaching English would be as easy as he thought it may have been. He may be a better teacher then his were, many CHS students would agree, but also found out that why it was so hard to teach English. There are many reasons why teaching English is difficult. First and major reason is the constant changing, and new words that are being brought into the language. While many of these words that are being are classified as slang, these words may become more and more common. In addition, many of the forms of languages that were used in the writing that students read are no longer used. Also, the change in styles of writing which have occurred make it hard for any student to completely understand what each writer is trying to say. Thousands of new words are brought into the English language each year. Just a few examples are dude, chic, cool, homes, and tubular. â€Å"Dude was brought into by many of the hippies of the sixty’s. Dude has many means, a person who someone is referring to can be taken into contexts as awesome.† When many people refer to a chic, they are no longer talking about a baby chicken, but a female who is found somewhat attractive. This word also becomes very popular during the sixties. Homes and tubular is probably the most recent of slang words. Homes is mostly used by gang-bangers and blacks of the southern area. When people say homes they are referring to one of their male friends. Not just a friend, but a male friend who would fight for the person. Tubular is just a new word for awesome or cool. It means really sweet (high quality of awesome) or awesome. In addition, words are used with a different context then before. Many new words are created this in America. The words sweet and fine have taken some of the largest changes in context of words. â€Å"Sweet no longer means have a sugar taste or pleasing to the senses.† If one was to ask a teenage what sweet meant to them, they would probably tell â€Å"really nice or awesome.† â€Å"The word fine has also completely change in context.

Tan Sri Syed Mokhtar Al-Bukhary

Early life Syed Mokhtar al-Bukhary was born into a mid-low class Malay family; whose house was without necessities and luxuries. His highest education was only until form five, and he never went to university. A whole lot of his knowledge and experience was gained through his own entrepreneurship experience during his youth time. Due in part his family's mediocre-to-poor background, Syed Mokhtar al Bukhary had to step into the working world in his early life, while pursuing his primary and secondary studies. Syed Mokhtar helped his mother planting and selling vegetables in the market and also selling roti canai. His numeric knowledge was used to help his father in doing daily book keeping. After finishing school, Syed Mokhtar helped his father in breeding cow business but only to see the business washed away by foot and mouth disease. Nevertheless, he took over the business and start over by selling meats. He then move on to packaging the meats and start selling them wholesale. His determination paid off and the business started to take off. Career Syed Mokhtar and Zainal started his business in Kedah in the 1990s dealing in rice. More success followed and he moved to rice trading business. He worked even harder after awarded the rice trading license from Lembaga Padi Negara, and was later awarded successions of supplier contract government-linked corporations as partner with Zainal Hatim Hj Ambia Bukhary. As his determination starting to skyrocket, he quickly moved to expand into diversification of other businesses. His next big move was in the logistics business, with initial goal to transport their trading materials. Today, his business empire has grown into areas such as plantation, property development, construction, engineering, power generation, infrastructure and ports. He owns 51. 8% share in Malaysian Mining Corporation via his wholly owned company, Syarikat Impian Teladan Sdn. Bhd. Tan Sri Syed Mokhtar and Zainal Hatim personally owns SKS Ventures, which was awarded the task of building the site for 2100MW coal-fired power station at Tanjung Bin, Johor. Tan Sri Syed Mohktar has a 32% share in PERNAS through his own company, Syarikat Ratu Jernih. Syarikat Perdana Padu Sdn. Bhd. and Corak Kukuh Sdn. Bhd. Tan Sri Syed Mokhtar and Zainal are Board Members of Syarikat Bina Puri Holdings Berhad, whereby, on his own, he has 7. 34% share. Apart from these, Tan Sri Syed Mokhtar and Zainal has varied interest in a number of companies, both in Malaysia as well as abroad. Charity His philanthropic values were nurtured from the age of 23 when he started a small business dealing in rice. When he received his first monthly income of RM1,500, his mother had told him to donate half of it to the poor. [3] From 1996 to 2006, his foundation has contributed almost RM1bil to charity, although his total income is probably in multiples of that figure. He has humanitarian projects in Asia and Africa, including rebuilding the lives of Afghan refugees, Pakistan's ear's tsunami victims and is now working to establish an AIDS hospital in Uganda. Among the foundation's initiatives are the Albukhary Tuition Programme for poor underachievers and the Albukhary Scholarship Programme for poor high achievers. Recognition In appreciation of his enormous services and contributions, he was bestowed with several awards, which among others, include the Panglima Setia Mahkota (P. S. M. ) by His Majesty Seri Paduka Baginda Yang di-Pertuan Agong, which carries the title Tan Sri and the Dato' Setia Mahkota Kedah (D. S. D. K. by HRH The Sultan Kedah, which carries the title Dato'. On 10 January 2008 or 1st Muharram 1429 Hijra he was announced and awarded as â€Å"Tokoh Ma'al Hijrah† by The Yang Di Pertuan Agong of Malaysia in recognition of his contribution to nation building and also Controversies A number of companies controlled by Syed Mokhtar have come under attack for development activities on greenfield sites. For example, the clearance of mangroves for the development of Johor Port has led to some criticisms from local environm ental groups. 4] He has also been identified as a major beneficiary of political connections that have given his subsidiary companies monopoly control over crucial Malaysian sectors, including rice, power and ports. Started out in the â€Å"bowl of Malaysia† as a rice trader. Later got government backing. Today controls Malaysia Mining Corporation (MMC); has stakes in Malaysia's Johor Port; the country's largest independent power producer Malakoff; and natural gas distribution company Gas Malaysia. Has invested in MPH (a book retailer in Singapore and Malaysia). He's contributed to a number of Islamic schools, mosques and Islamic arts.

Maslow’s Hierarchy of Needs Essay

1)Explain the motivation problem with the hourly-paid employees in this organization in terms of the content models of motivation. What are the other things that the human resources manager is referring to in speaking of things besides money, conditions, and fringe benefits that are needed to motivate employees? The first theory that is briefly presented is Maslow’s hierarchy of needs. After which, this is linked to the needs of Tom, Rajina, and Harry. Maslow’s Hierarchy of Needs Perhaps, the most famous theory of satisfaction and motivation was developed by Abraham Maslow (1954 in Loop, 1994). Maslow believed that employees would be satisfied with their jobs at any given point in time if certain needs were met. Maslow believed that there are five major types of needs and these needs are hierarchical – that is, lower level needs must be satisfied before an employee will be concerned with the next level of needs. Basic biological needs. Maslow thought that an individual first seeks to satisfy basic biological needs for food, air, water, and shelter. An individual who does not have a job, is homeless, and is on the verge of starvation will be satisfied with any job as long as it provides for these basic needs. When asked how well they enjoy their job, people at this level might reply, â€Å"I can’t complain, it pays the bills. † Safety needs. After the basic biological needs have been met, a job that merely provides food and shelter will no longer be satisfying. Employees then become concerned about meeting their safety needs. That is, they may work in an unsafe coal mine to earn money to ensure their family’s survival, but once their family has food and shelter, they will remain satisfied with their jobs only if their workplace is safe. Safety needs have been explained to include psychological as well as physical safety. Psychological safety – often referred to as job security – can certainly affect job satisfaction. For example, public sector employees often list job security as a main benefit to their jobs – a benefit so strong that they will stay in lower paying public sector jobs rather than take higher paying, yet less secure, jobs in the private sector. Social needs. Once these first two need levels have been met, employees will remain satisfied with their jobs only when their social needs have been met. Social needs involve working with others, developing friendships, and feeling needed. Organizations attempt to satisfy their employees’ social needs in a variety of ways. Company cafeterias provide workers the place and opportunity to socialize and meet other employees, company picnics allow families to meet one another, and company sports programs such as bowling teams and softball games provide opportunities for employees to play together in a neutral environment. Ego needs. When social needs have been satisfied, employees concentrate next on meeting their ego needs. These are needs for recognition and success, and an organization can help to satisfy them through praise, salary increases, and publicity. Ego needs can be satisfied in many ways. For example, many organizations use furniture to help satisfy ego needs. The higher the employee’s position, the better his office furniture. Self-actualization needs. Even when employees have friends, have earned awards, and are making a relatively high salary, they may not be completely satisfied with their jobs because their self-actualization needs may have not been satisfied yet. These needs are the fifth and final level of Maslow’s needs hierarchy. Self-actualization may be best defined by the US Army’s recruiting slogan, â€Å"be the best that you can be. † An employee striving for self-actualization wants to reach her potential in every task. Thus, employees who have worked within the same machine for 20 years may become dissatisfied with their jobs. They have accomplished all that they can with that particular machine and now search for a new challenge. If none is available, they may become dissatisfied (Knoop, 1994). In the case study, it has been pointed out that Tom does not seem to be simply motivated by money alone, suggesting that he has probably gone beyond the basic biological needs. There should be effort on the part of his supervisor to look for esteem or self-actualization needs, perhaps. One option is for his job to be enriched. This is also true in the case of Rajina who does have loyalty to the company, but is not too assertive. She may be asked to engage in activities that will increase her self-esteem. Finally, Tom is easily motivated by monetary rewards, and may be rewarded and motivated by these. Still another theory is the two factor theory of Herzberg. Two-factor Theory Still another needs theory, which reduces the number of needs to two, was developed by Herzberg. He believed that job-related factors can de divided into two categories, motivators and hygiene factors – thus the name two-factor theory. Hygiene factors are those job-related elements that results from but do not involve the job itself. For example, pay and benefits are consequences of work but do not involve the work itself. Similarly, making new friends may result from going to work, but it is also not directly involved with the tasks and duties of the job. Motivators are job elements that do concern actual tasks and duties. Examples of motivators would be the level of job responsibility, the amount of job control, and the interest that the work holds for the employee. Herzberg believed that hygiene factors are necessary but not sufficient for job satisfaction and motivation. That is, if a hygiene factors is not present at an adequate level (e. g. the pay is too low), the employee will be dissatisfied. But if all hygiene factors are represented adequately, the employee’s level of satisfaction will only be neutral. Only the presence of both motivators and hygiene factors can bring job satisfaction and motivation. Herzberg’s theory is one of those theories that makes sense but has not received strong support from research. In general, researchers have criticized the theory because of the methods used to develop the two factors as well as the fact that few research studies have replicated the findings obtained by Herzberg and his colleagues (Knoop, 1994). McClelland’s Needs Theory The final needs theory was developed by McClelland (1961 in Knoop, 1994) and suggests that differences between individuals stem from the relationship between a job and each employee’s level of job satisfaction or motivation. McClelland believed that employees differ in their needs for achievement, affiliation, and power. Employees who have a strong need for achievement desire jobs that are challenging and over which they have some control, whereas employees who have minimal achievement needs are more satisfied when jobs involve little challenge and have high probability of success. In contrast, employees who have a strong need for affiliation prefer working with and helping other people. These types of employees are found more often in people-oriented service jobs than in management or administration (Smither & Lindgren, 1978). Finally, employees who have a strong need for power have a desire to influence others rather than simply be successful. Research has shown that employees who have a strong need for power and achievement make the best managers (Stahl, 1983) and that employees who are motivated most by their affiliation needs will probably make the worst managers. It is apparent from both theories that Tom, Rajina and Harry may have need for hygiene factors to increase their productivity. This means that management must offer motivators to retain them or to motivate them to work more. 2)Building on the response to Question 1, explain the motivation of the hourly-paid employees in this company in terms of the process models of motivation. Based on the information provided by the confidential interviews, what would you guess are some of the expectancies, valences, and inequities of the hourly-paid employees of this company? How do these compare to those of Pat (the Director of Manufacturing and Operations)? Based on Vroom’s expectancy theory, Tom, Rajina and Harry have varying valences, expectancies and instrumentality. For example, in the case of Tom, values inspiration and motivation – which are intangibles. However, he is not motivated because he does not receive this from the company. He also does not believe that exerting more effort at work would allow him to receive such inspiration. In the case of Rajina, she has a high need for esteem, which she does not experience because she does not know to advertise her efforts to colleagues. Recognition is what may be given to her to compensate for her efforts and loyalty. There is no direct link from her perspective, of exerting more effort at work, and receiving such recognition as reward. Finally, Tom puts great premium on monetary rewards and benefits. However, based on the perceptions of hourly paid employees in general, there is no significant difference between those who work hard and those who contribute little. A compensation and bonus scheme reflective of relative contribution must be established to motivate employees like him. Based on these information, how can management leverage on the motivation of employees to enable them to attain higher productivity? Individual differences theory postulates that some variability in job satisfaction is due to an individual’s personal tendency across situations to enjoy what she does. Thus, certain types of people will generally be satisfied and motivated regardless of the type of job they hold (Weaver, 1978). The idea also makes intuitive sense. We all know that people who constantly complain and whine about every job they have, and we also know people who are motivated and enthusiastic about every job or task. First, we should be aware of the fact that there are several factors that affect our hourly paid employees’ satisfaction. Apart from money and fringe benefits that motivate employees like Harry, personality is another factor to consider. Whether the consistency in job satisfaction is due to genetic or environmental factors, there appears to be a series of personality variables that are related to job satisfaction. That is, certain types of personalities are associated with the tendency to be satisfied or dissatisfied with one’s job. Judge et al. (1998) have hypothesized that these personality variables are related and involve people’s outlook on life (affectivity), view of their self-worth (self-esteem), ability to master their environment (self-efficacy), and ability to control their environment (external vs. internal locus of control). People prone to be satisfied with their jobs have high self-esteem, high self-efficacy, high positive affectivity, and an internal locus of control. Research supporting this view has come from Judge et al. 1998), who found a significant correlation between a combination of these four variables and job satisfaction, and from Garske (1990), who found that employees with high self-esteem are more satisfied with their jobs than are employees low in self-esteem. Results consistent with the core evaluation theory were reported by Dubin and Champoux (1977), who found that some people are happier in their jobs than people without this focus. Moreover, the degree to which they are satisfied with their lives is also another determinant of their motivation on the job. Judge et al. 1998), Judge and Watanabe (1993), and Tait et al. (1989) have theorized not only that job satisfaction is consistent across time but that the extent to which a person is satisfied with all aspects of her life (e. g. marriage, friends, job, family, geographic location) is as well. Furthermore, people who are satisfied with their jobs tend to be satisfied with life. These researchers found support for their theory, as their data indicate that job satisfaction is significantly correlated with life satisfaction. Thus, people happy in life tend to be happy in their jobs and vice versa. Individual differences theories postulate that some employees are more predisposed to being motivated than others. Such things as genetics and affectivity are involved in the extent to which some people tend to always be satisfied with their jobs and others always dissatisfied. However, rather than genetics and affectivity, self-esteem, need for achievement, and intrinsic motivation tendency are the individual differences most related to work motivation. To be able to address hourly employees’ intangible needs, there must be much effort on management’s part to increase employees’ self-esteem. These may not be too applicable for Harry who seems to be more motivated by basic needs, i. e. money and fringe benefits. There are various ways of carrying this out, as follows: Employees who can attend workshops or sensitivity groups in which they are given insights into their strengths. It is thought that these insights raise self-esteem by showing the employee that he has several strengths and is a good person. Management also ought to provide hourly paid employees with experience on success. With this approach, an employee is given a task so easy that he will almost certainly succeed. It is thought that this success increases self-esteem, which should increase performance, then further increase self-esteem, then further increase performance, and so on. This method is based loosely on the principle of self-fulfilling prophecy, which states that an individual will perform as well or as poorly as he expects to perform. In other words, if he believes he is intelligent, he should do well on tests. If he believes he is dumb, he should do poorly. So if an employee believes he will always fail, the only way to break the vicious cycle is to ensure that he performs well on a task (Knoop, 1994). Particularly in the case of Tom, management has to think of ways to motivate him to achieve. Employees who have a strong need for achievement desire and are motivated by jobs that are challenging and over which they have some control, whereas employees who have minimal achievement needs are more satisfied when their work involves little challenge. Employees who have a high need for achievement ate not risk takers and tend to set goals that are challenging enough to be interesting but low enough to be attainable. Employees with a high need for achievement need recognition and want their achievements to be noticed. To increase motivation, goal setting should be used. This is particularly applicable in Tom’s and Rajina’s case who do not seem to perform well without adequate supervision. With goal setting, each employee is given a goal, which might be a particular quality level, a certain quantity of output, or a combination of the two. For goal setting to be most successful, the goals themselves should possess certain qualities. First, they should be concrete and specific. Setting more specific subgoals can also improve performance (Klawsky, 1990). Second, a properly set goal is high but reasonable (Locke & Latham, 1990). To increase the effectiveness of goal setting, feedback should be provided to the employee on his progress in reaching his goal (Locke & Latham, 1990). Feedback can include verbally telling an employee how he is doing, placing a chart on a wall, or displaying a certain color of light when the employee’s work pace will result in goal attainment and a different color of light when the pace is too slow to reach the goal. Feedback increases performance best when it is positive and informational rather than negative and controlling. Another set of theories hypothesizes that workers are motivated when they are rewarded for their behavior. As a result, organizations offer incentives for a wide variety of employee behaviors, including working overtime or on weekends, making suggestions, referring applicants, staying with the company (length of service awards), coming to work (attendance bonuses), not getting into accidents, and performing at a high level (Henderson, 1997).

Assessing Compnay’s Financial Health

Assessing a Company's Future Financial Health Assessing the long-term financial health of a company is an important task for management in its formulation of goals and strategies and for outsiders as they consider the extension of credit, long- term supplier agreements, or an investment in a company’s equity. History abounds with examples of companies that embarked upon overly ambitious programs and subsequently discovered that their portfolios of programs could not be financed on acceptable terms.The outcome frequently was the abandonment of programs in mid-stream at considerable financial, organizational, and human cost. It is the responsibility of management to anticipate future imbalance in the corporate financial system before its severity is reflected in the financials, and to consider corrective action before both time and money are exhausted. The avoidance of bankruptcy is an insufficient standard. Management must ensure the continuity of the flow of funds to all of it s strategically important programs, even in periods of adversity.Figure A provides a conceptualization of the corporate financial system, with a suggested step-by- step process to assess whether it will remain in balance over the ensuing 3-5 years. The remainder of this note discusses each of the steps in the process and then provides an exercise on the various financial measures that are useful as part of the analysis. The final section of the note demonstrates the relationship between a firm’s strategy and operating characteristics, and its financial characteristics.Professor Thomas Piper prepared the original version of this note, â€Å"Assessing a Firm’s Future Financial Health,† HBS No. 201-077, which is being replaced by this version prepared by the same author. This note was prepared as the basis for class discussion. Copyright  © 2010, 2011 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-80 0-545- 7685, write Harvard Business School Publishing, Boston, MA 02163, or go to www. hbsp. harvard. edu/educators.This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School. 911-412Assessing a Company's Future Financial Health Figure AThe Corporate Financial System Goals Step 1Strategy Market, Competitive Technology Regulatory and Operating Characteristics Step 2Revenue Outlook †¢growth rate †¢volatility, predictability Step 3Step 4 Investment in AssetsEconomic Performance †¢to support growth†¢profitability †¢improvement/deterioration in asset management cash flow †¢volatility, predictability Step 5Step 6 External Financing NeedTarget Sources of Finance †¢$ amount†¢lending/investing criteria †¢timing, duration †¢deferability †¢attractiveness of firm to each target source Step 7 Viability of 3-5 Year Plan †¢consistency with goals â € ¢achievable operating plan †¢achievable financing plan Step 8 Stress Test for Viability Under Various scenarios Step 9 Financing and Operating Plan for Current Year Steps 1, 2: Analysis of FundamentalsThe corporate financial system is driven by the goals, business unit choices and strategies, market conditions and the operating characteristics. The firm’s strategy and sales growth in each of its business units will determine the investment in assets needed to support these strategies; and the effectiveness of the strategies, combined with the response of competitors and regulators, will 2 Assessing a Company's Future Financial Health911-412 strongly influence the firm’s competitive and profit performance, its need for external finance, and its access to the debt and equity markets.Clearly, many of these questions require information beyond that contained in a company’s published financial reports. Step 3: Investments to Support the Business Unit(s) Stra tegy(ies) The business unit strategies inevitably require investments in accounts receivable, inventories, plant ; equipment, and possibly, acquisitions. Step 3 of the process is an attempt to estimate the amount that will be tied up in each of the asset types by virtue of sales growth and the improvement/deterioration in asset management.An analyst can make a rough estimate by studying the past pattern of the collection period, the days of inventory, and plant ; equipment as a percent of cost of goods sold; and then applying a â€Å"reasonable value† for each to the sales forecast or the forecast of cost of goods sold. Extrapolation of past performance assumes, of course, that the future underlying market, competitive and regulatory â€Å"drivers† will be unchanged from the conditions that influenced the historical performance. Step 4: Future Profitability and Competitive PerformanceStrong sustained profitability is an important determinant of (1) a firm’s acce ss to debt and/or equity finance on acceptable terms; (2) its ability to self-finance growth through the retention of earnings; (3) its capacity to place major bets on risky new technologies, markets, and/or products; and (4) the valuation of the company. A reasonable starting point is to analyze the past pattern of profitability. 1. What have been the average level, trend and volatility of profitability? 2. Is the level of profitability sustainable, given the outlook for the market and for competitive and regulatory pressures? . Is the current level of profitability at the expense of future growth and/or profitability? 4. Has management initiated major profit improvement programs? Are they unique to the firm or are they industry-wide and may be reflected in lower prices rather than higher profitability? 5. Are there any â€Å"hidden† problems, such as suspiciously high levels or buildups of accounts receivable or inventory relative to sales, or a series of unusual transactio ns and/or accounting changes? Step 5: Future External Financing NeedsWhether a company has a future external financing need depends on (1) its future sales growth; (2) the length of its cash cycle; and (3) the future level of profitability and profit retention. Rapid sales growth by a company with a long cash cycle (a long collection period + high inventories + high plant ; equipment relative to sales) and low profitability/low profit retention is a recipe for an ever- increasing appetite for external finance, raised in the form of loans, debt issues, and/or sales of shares. Why?Because the rapid sales growth results in rapid growth of an already large level of total assets. The increase in total assets is offset partially by an increase in accounts payable and accrued expenses, and by a small increase in owners’ equity. However, the financing gap is substantial. For example, the company portrayed in Table A requires $126 million of additional external finance by the end of y ear 2010 to finance the increase in total assets required to support 25% per year sales growth in a business that is fairly asset intensive. 3 911-412Assessing a Company's Future Financial Health Table A |Assuming a 25% Increase in Sales ($ in millions) | | | | | | |Assets |2009 |2010 | |Cash |$ 12 |^ 25% |$ 15 | |Accounts receivable |240 |^ 25% |300 | |Inventories |200 |^ 25% |250 | |Plant ; equipment | 400 |^ 25% | 500 | |Total |$852 | |$1,065 | | | | | | |Liabilities and Equity | | | | |Accounts payable |$100 |^ 25% |$ 125 | |Accrued expenses |80 |^ 25% |100 | |Long-term debt |272 |Unchanged |272 | |Owners’ equity | 400 |footnote a | 442 | |Total |$852 | |$ 939 | |External financing need | 0 | | 126 | |Total |$852 | |$1,065 | a It is assumed (1) that the firm earns $60 million (a 15% return on beginning of year equity) and pays out $18 million as a cash dividend; and (2) that there is no required debt repayment in 2010. If, however, the company reduced its sales growth to 5% (and total assets, accounts payable and accrued expenses increased accordingly by 5%), the need for additional external finance would drop from $126 million to $0.High sales growth does not always result in a need for additional external finance. For example, a food retailer that extends no credit to customers, has only eight days of inventory, and does not own its warehouses and stores, can experience rapid sales growth and not have a need for additional external finance provided it is reasonably profitable. Because it has so few assets, the increase in total assets is largely offset by a corresponding, spontaneous increase in accounts payable and accrued expenses. Step 6: Access to Target Sources of External Finance Having estimated the future financing need, management must identify the target sources (e. g. banks, insurance companies, public debt markets, public equity market) and establish financial policies that will ensure access on acceptable terms. 1. How sound is the fi rm’s financial structure, given its level of profitability and cash flow, its level of business risk, and its future need for finance? 2. How will the firm service its debt? To what extent is it counting on refinancing with a debt or equity issue? 3. Does the firm have assured access on acceptable terms to the equity markets? How many shares could be sold and at what price in â€Å"good times†? In a period of adversity? 4. What criteria are used by each of the firm’s target sources of finance to determine whether finance will be provided and, if so, on what terms? 4 Assessing a Company's Future Financial Health911-412The evaluation of a firm’s financial structure can vary substantially depending on the perspective of the lender/investor. A bank may consider a seasonal credit a very safe bet. Considerable shrinkage can occur in the conversion of inventory into sales and collections without preventing repayment of the loan. In contrast, an investor in the f irm’s 20-year bonds is counting on its sustained health and profitability over a 20-year period. Step 7: Viability of the 3-5 Year Plan 1. Is the operating plan on which the financial forecasts are based achievable? 2. Will the strategic, competitive, and financial goals be achieved? 3. Will the resources required by the plan be available? 4.How will the firm’s competitive, organizational, and financial health at the end of the 3-5 years compare with its condition at the outset? Step 8: Stress Test under Scenarios of Adversity Financing plans typically work well if the assumptions on which they are based turn out to be accurate. However, this is an insufficient test in situations marked by volatile and unpredictable conditions. The test of the soundness of a 3-5 year plan is whether the continuity of the flow of funds to all strategically important programs can be maintained under various scenarios of adversity for the firm and/or the capital markets—or at least be maintained as well as your competitors are able to maintain the funding of their programs.Step 9: Current Financing Plan How should the firm meet its financing needs in the current year? How should it balance the benefits of future financing flexibility (by selling equity now) versus the temptation to delay the sale of equity by financing with debt now, in hopes of realizing a higher price in the future? The next section of this note is designed to provide familiarity with the financial measures that can be useful in understanding the past performance of a company. Extrapolation of the past performance, if done thoughtfully, can provide valuable insights as to the future health and balance of the corporate financial system.Historical analysis can also identify possible opportunities for improved asset m a n a g e m e n t or margin i m p r o v e m e n t , as well as provide an important, albeit incomplete, basis for evaluating the attractiveness of a business and/or the effective ness of a management team. Financial Ratios and Financial Analysis The three primary sources of financial data for a business entity are the income statement, the balance sheet, and the statement of cash flows. The income statement summarizes revenues and expenses over a period of time. The balance sheet is the list of what a company owns (its assets), what it owes (its liabilities), and what has been invested by the owners (owners’ equity) at a specific point in time.The statement of cash flow categorizes all cash transactions during a specific period of time in terms of cash flows generated or used for operating activities, investing activities, and financing activities. The focus of this section is on performance measures based on the income statements and balance sheets of SciTronics—a medical device company. The measures can be grouped by type:(1) 5 911-412Assessing a Company's Future Financial Health profitability measures, (2) activity (asset management) measure s, (3) leverage and liquidity measures. Please refer to the financial statements of SciTronics as shown in Exhibits 1 and 2 at the end of the note.As you work through the questions that follow, please also consider three broad questions: 1. What is your assessment of the performance of SciTronics during the 2005-2008 period? 2. Has its financial strength and its access to external sources of finance improved or weakened? 3. What are the 2-3 most important questions you would ask management as the result of your analysis? Sales Growth Sales growth is an important driver of the need to invest in various type assets and of the company’s value. It also provides some indication of the effectiveness of a firm’s strategy and product development activities, and of customer acceptance of a firm’s products and services. 1.During the four-year period ended December 31, 2008, SciTronics’ sales grew at a % compound rate. There were no acquisition or divestitures. Prof itability Ratio: How Profitable Is the Company? Profitability is a necessity over the long-run. It strongly influences (1) the company’s access to debt; (2) the valuation of the company’s common stock; (3) the willingness of management to issue stock; and (4) the capacity to self-finance. One measure of profitability of a business is its return on sales, measured by dividing net income by net sales. 1. SciTronics’ profit as a percentage of sales in 2008 was %. 2. This represented an increase/decrease from % in 2005.Management and investors often are more interested in the return earned on the funds invested than in the level of profits as a percentage of sales. Companies operating in businesses requiring very little investment in assets often have low profit margins but earn very attractive returns on invested funds. Conversely, there are numerous examples of companies in very capital-intensive businesses that earn miserably low returns on invested funds, despit e seemingly attractive profit margins. Therefore, it is useful to examine the return earned on the funds provided by the shareholders and by the â€Å"investors† in the company’s interest-bearing debt.To increase the comparability across companies, it is useful to use EBIAT (earnings before interest but after taxes) as the measure of return. The use of EBIAT as the measure of return also allows the analyst to compare the return on invested capital (calculated before the deduction of interest expense), with the company’s estimated cost of capital to determine the long-term adequacy of the company’s profitability. EBIAT is calculated by multiplying EBIT (earnings before interest and taxes) times (1—the average tax rate). EBIT x ? 1 ? tax rate? Owners? equity plus interest bearing debt 3. SciTronics had a total of $_ of capital at year-end 2008 and earned before interest but after taxes (EBIAT) $ during 2008.Its return on capital was % in 2008 which r epresented an increase/decrease from the % earned in 2005. 6 Assessing a Company's Future Financial Health911-412 From the viewpoint of the shareholders, an equally important figure is the company’s return on equity. Return on equity is calculated by dividing profit after tax by the owners’ equity. Profit after taxes Owners? equity Return on equity indicates how profitably the company is utilizing shareholders’ funds. 4. SciTronics had $_ of owners’ equity and earned $_ after taxes in 2008. Its return on equity was % an improvement/deterioration from the % earned in 2005. Activity Ratios: How Well Does the Company Employs Its Assets?The second basic type of financial ratio is the activity ratio. Activity ratios indicate how well a company employs its assets. Ineffective utilization of assets results in the need for more finance, unnecessary interest costs, and a correspondingly lower return on capital employed. Furthermore, low activity ratios or deterior ation in the activity ratios may indicate uncollectible accounts receivable or obsolete inventory or equipment. Total asset turnover measures the company’s effectiveness in utilizing its total assets and is calculated by dividing total assets into sales. Net sales Total assets Total asset turnover for SciTronics in 2008 can be calculated by dividing $ into $ .The turnover improved/deteriora ed from times in 2005 to times in 2008. It is useful to examine the turnover ratios for each type of asset, as the use of total assets may hide important problems in one of the specific asset categories. One important category is accounts receivables. The average collection period measures the number of days that the company must wait on average between the time of sale and the time when it is paid. The average collection period is calculated in two steps. First, divide annual credit sales by 365 days to determine average sales per day: Net credit sales 365 days Then, divide the accounts r eceivable by average sales per day to determine he number of days of sales that are still unpaid: Accounts receivable Credit sales per day SciTronics had $ invested in accounts receivables at year-end 2008. Its average sales per day were $ during 2008 and its average collection period was _days. This represented an improvement/deterioration from the average collection period of days in 2005. A third activity ratio is the inventory turnover ratio, which indicates the effectiveness with which the company is employing inventory. Since inventory is recorded on the balance sheet at cost (not at 7 911-412Assessing a Company's Future Financial Health ts sales value), it is advisable to use cost of goods sold as the measure of activity. The inventory turnover figure is calculated by dividing cost of goods sold by inventory: Cost of goods sold Inventory 3. SciTronics apparently needed $ of inventory at year-end 2008 to support its operations during 2008. Its activity during 2008 as measured by the cost of goods sold was $_ . It therefore had an inventory turnover of times. This represented an improvement/deterioration from times in 2005. An alternative measure of inventory management is days of inventory, which can be calculated by dividing cost of goods sold by 365 days to determine average cost of goods sold per day.Days of inventory is calculated by dividing total inventory by cost of goods sold per day. A fourth and final activity ratio is the fixed asset turnover ratio which measures the effectiveness of the company in utilizing its plant and equipment: NetsalesNet fixed assets 4. SciTronics had net fixed assets of $ and sales of $ in 2008. Its fixed asset turnover ratio in 2008 was times, an improvement/deterioration from times in 2005. Leverage Ratios: How Soundly is the Company Financed? There are a number of balance sheet measures of financial leverage. The various leverage ratios measure the relationship of funds supplied by creditors to the funds supplied by owners.The use of borrowed funds by reasonably profitable companies will improve the return on equity. However, it increases the riskiness of the business and the riskiness of the returns to the stockholders, and can result in financial distress if used in excessive amounts. The ratio of total assets divided by owners’ equity is an indirect measure of leverage. A ratio, for example, of $6 of assets for each $1 of owner’s equity indicates that $6 of assets is financed by $1 of owners’ equity and $5 of liabilities. 1. SciTronics’ ratio of total assets divided by owners’ equity increased/decreased from at year –end 2005 to at year-end 2008.The same â€Å"story† of increasing financial leverage is told by dividing total liabilities by total assets. 2. At year-end 2008, SciTronics’ total liabilities were % of its total assets, which compares with % in 2005. Lenders—especially long-term lenders—want reasonable assuranc e that the company will be able to repay the loan in the future. They are concerned with the relationship between a company’s debt and its total economic value. This ratio is called the total debt ratio at market. Total liabilities Total liabilities ? market value of the equity The market value of the equity is calculated by multiplying the number of shares of common stock outstanding times the market price per share. 8Assessing a Company's Future Financial Health911-412 3. The market value of SciTronics’ equity was $175,000,000 at December 31, 2008. The total debt ratio at market was . A fourth ratio that relates the level of debt to economic value and performance is the times interest earned ratio. This ratio relates earnings before interest and taxes—a measure of profitability and of long-term viability—to the interest expense—a measure of the level of debt. Earnings before interest and taxes Interest expense 4. SciTronics’ earnings befor e interest and taxes (operating income) were $_ in 2008 and its interest charges were $ . Its times interest earned was times.This represented an improvement/deterioration from the 2005 level of times. A fifth and final leverage ratio is the number of days of payables. This ratio measures the average number of days that the company is taking to pay its suppliers of raw materials and components. It is calculated by dividing annual purchases by 365 days to determine average purchases per day: Annual purchases 365 days Accounts payable are then divided by average purchases per day: Accounts payable Average purchases per day to determine the number of days purchases that are still unpaid. It is often difficult to determine the purchases of a firm.Instead, the income statement shows cost of goods sold, a figure that includes not only raw materials but also labor and overhead. Thus, it often is only possible to gain a rough idea as to whether or not a firm is becoming more or less depende nt on its suppliers for finance. This can be done by tracking the pattern over time of accounts payable as a percent of cost of goods sold. Accounts payable Cost of goods sold 5. SciTronics owed its suppliers $ at year end 2008. This represented % of cost of goods sold and was an increase/decrease from % at year end 2005. The company appears to be more/less prompt in paying its suppliers in 2008 than it was in 2005. 6.The financial riskiness of SciTronics increased/decreased between 2005 and 2008. Liquidity Ratios: How Liquid is the Company? The fourth basic type of financial ratio is the liquidity ratio. These ratios measure a company’s ability to meet financial obligations as they become current. The current ratio, defined as current assets divided by current liabilities, assumes that current assets are much more readily and certainly convertible into cash than other assets. It relates these fairly liquid assets to claims that are due within one year—the current liab ilities. 9 911-412Assessing a Company's Future Financial Health Current assets Current liabilities 1.SciTronics held $ of current assets at year-end 2008 and owed $ to creditors due to be paid within one year. Its current ratio was , an increase/decrease from the ratio of at year-end 2005. The quick ratio or acid test is similar to the current ratio but excludes inventory from the current assets: Current assets ? Inventory Current liabilities Inventory is excluded because it is often difficult to convert into cash (at least at book value) if the company is struck by adversity. 2. The quick ratio for SciTronics at year-end 2008 was _, an increase/decrease from the ratio of at year-end 2005. Profitability RevisitedManagement can â€Å"improve† its return on equity by improving its return on sales and/or its asset turnover and/or by increasing its financial leverage as measured by total assets divided by owners’ equity. ROE ? Net Income x Sales Sales Total Assets Total As sets x Owners? Equity Each method of â€Å"improvement† differs operationally and in terms of risk. 1. The improvement in SciTronics’ return on equity from 8. 2% in 2005 to 18. 7% in 2008 resulted from an increase/decrease in its return on sales; and an increase/decrease in its asset turnover, and an increase/decrease in its financial leverage. A WarningThe calculated ratios are no more valid than the financial statements from which they are derived. The quality of the financial statements should be assessed and appropriate adjustments made, before any ratios are calculated. Particular attention should be placed on assessing the reasonableness of the accounting choices and assumptions embedded in the financial statements. The Case of the Unidentified Industries The preceding exercise suggests a series of questions that may be helpful in assessing a company’s future financial health. It also describes several ratios that are useful in answering some of the questi ons, especially if the historical trend in these ratios can be reasonably extrapolated.However, it is also important to compare the actual absolute value with some standard to determine whether the company is performing well. Unfortunately, there is no single current ratio, inventory turnover, or debt ratio that is appropriate to all industries. The operating and competitive characteristics of the company’s industry greatly influence its investment in the various types of assets, the riskiness of these investments, and the financial structure of its balance sheet. 10 Assessing a Company's Future Financial Health911-412 Try to match the five following types of companies with their corresponding balance sheets and financial ratios as shown in Exhibit 3. 1. Electric utility 2. Japanese automobile manufacturer 3. Discount general merchandise retailer 4.Automated test equipment/systems company 5. Upscale apparel retailer In doing the exercise, consider the operating and competitiv e characteristics of the industry and their implications for (1) the collection period; (2) inventory turnover; (3) the amount of plant and equipment; (4) the profit margins and profitability; and (5) the appropriate financing structure. Then identify which one of the five sets of balance sheets and financial ratios best match your expectations, given the difficult economic conditions in 2009. 11 911-412Assessing a Company's Future Financial Health Exhibit 1SciTronics, Inc. Consolidated Income Statements 2005-2008 ($ in thousands) 20042005200620072008 | | | | | | |Sales |$115,000 |$147,000 |171,000 |$205,000 |$244,000 | |Cost of goods sold | | 43,000 | 50,000 | 63,000 | 74,000 | |Gross margin | |104,000 |121,000 |142,000 |170,000 | |Research ; development | |15,000 |20,000 |26,000 |28,000 | |Sell, general ; administrative | | 79,000 | 92,000 | 106,000 | 116,000 | |Operating income | 10,000 |9,000 |10,000 |26,000 | |Interest expense | | 1,000 | 2,000 | 2,000 | 2,000 | |Profit before tax | |9,000 |7,000 |8,000 |24,000 | |Income tax | |4,000 | 2,000 | 3,000 | 10,000 | |Net income | |$ 5,000 |$ 5,000 |$ 5,000 |$14,000 | Exhibit 2SciTronics, Inc. Consolidated Balance Sheet at December 31, 2005-2008 ($ in thousands) | | | | | | |2005 |2006 |2007 |2008 | | | | | | | |Cash |$ 9,000 |$ 10,000 |$ 15,000 |$ 18,000 | |Accounts receivable |42,000 |53,000 |61,000 |66,000 | |Inventories |21,000 |28,000 |30,000 |29,000 | |Other current assets | 10,000 | 13,000 | 21,000 | 20,000 | |Total current assets |82,000 |104,000 |127,000 |133,000 | |Net property ; equipment |9,000 |12,000 |13,000 |18,000 | |Other | 2,000 | 2,000 | 6,000 | 8,000 | |Total assets |$93,000 |$118,000 |$146,000 |$159,000 | | | | | | | |Notes payable |$ 3,000 |$ 18,000 |$ 8,000 |$ 10,000 | |Accounts payable |5,000 |6,000 |7,000 |6,000 | |Accrued expenses |10,000 |13,000 |21,000 |28,000 | |Other current liabilities | 3,000 | 3,000 | 4,000 | 4,000 | |Total urrent liabilities |21,000 |40,000 |40,000 |48,000 | |Lo ng-term senior debt |10,000 |9,000 |8,000 |7,000 | |Subordinated convertible debt |– |– |20,000 |20,000 | |Other liabilities |1,000 |3,000 |7,000 |9,000 | |Owners’ equity |61,000 |66,000 |71,000 |85,000 | |Treasury stock |– |– |– |(10,000) | |Owners’ equity | 61,000 | 66,000 | 71,000 | 75,000 | |Total liabilities and equity |$93,000 |$118,000 |$146,000 |$159,000 | 12 Assessing a Company's Future Financial Health911-412 Exhibit 3Unidentified Industries Balance Sheet Percentages ABCDE Cash1. 5%14. 4%12. 1%13. 3%11. 0% Receivables4. 63. 830. 939. 811. 8 Inventories1. 824. 613. 74. 716. 7 Other current assets2. 04. 35. 03. 810. 0 Property and equipment (net)74. 549. 634. 122. 120. 3 Other assets 15. 6 3. 4 4. 3 16. 3 30. 2 Total assets100%100%100%100%100% Notes payable5. 3%0. 4% 5. 4%18. 2%1. 4% Accounts payable2. 124. 811. 0 8. 38. 8 Other current liabilities5. 917. 014. 28. 716. 5 Long-term debt33. 610. 034. 323. 121. 7 Other liabilitie s26. 32. 211. 25. 62. 0Owners’ equity 26. 8 45. 6 23. 9 36. 1 49. 6 Total100%100%100%100%100% Selected Ratios Net profit/net sales10. 3%1. 5% 5. 1%1. 3%(5. 8%) Return on capital 6. 8%9. 2%12. 6%0. 9%(3. 1%) Return on equity12. 5%10. 8%28. 1%2. 2%(7. 6%) Sales/total assets . 323. 251. 31. 63 . 65 Collection period (days)5248623243 Days of inventory43326231147 Sales/net property ; equipment. 436. 73. 82. 93. 6 Total assets/equity3. 732. 194. 192. 792. 01 Total liabilities/total assets. 73. 54. 76. 66. 50 Interest-bearing debt/total capital 59%19% 62%53% 32% Times interest earned3. 2 16 6. 0 4. 4NM Current assets/current liabilities . 671. 112. 011. 221. 85 13