Poem of William Caslos William Essay

William Carlos Williams is a pioneer who creates a whole new realm in American poetry. He is regarded as an important and influential poet because of his unique and usually plain style. The poem â€Å"Poem† is one of the most prominent poems reflecting Williams’ style of writing. In this piece of work, Williams discusses a central contrast between the mortality of life and immortality of art through the image of two roses – in nature and in poetry. It can be said that life is symbolized by the rose, the central image and also the main theme of â€Å"Poem†. The real rose and unreal one are skillfully used to represent two factors: the reality and the art. In nature, a rose which cannot avoid the cycle of time undergoes stages of nature rules. First, it germinates from a seed. Then, it grows up and blooms or blossoms. Next, it fades or discolored. Finally, it dies. â€Å"The rose fades – And is renewed again – By its seed naturally† (Williams, 1983). The issue of the rose fading show that life, no matter what forms, follows the nature changing rule and eventually fades away. Meanwhile, Williams uses the image of the rose in poem to respect the art because the real rose will fade naturally but the rose of art keeps an ever-lasting beauty: â€Å"Save in the poem – shall it go – to suffer no diminution – of its splendor† (Williams, 1983). Generally, the whole poem presents the central contrast of nature versus art, death versus life and cycle of time versus perfection that lasts forever. With respect to the highlighted image of the rose in poetry, it can not be touch but lives forever and remains perfect, fresh, young, and beautiful regardless of time. It has the empowerment of splendor, perfection, and immortality. In fact, Williams’ intention after his words of praising the power of the rose in poem is to advocate the power of art in general. It seems that the poet gives prominence to art whose role is to inspire and guide people through curves of life thanks to its beauty and significance of teaching truth, giving beauty and pleasure, shaping moral characters, showing power of language and showing human experience.

Escape Essay

All day long Orloff had paced his cell. The blackness of the sky outside was equaled only by the blackness of his thoughts. The deep rolling of the thunder reverberated through the thick stone walls of his prison, and every now and then a fitful gust of rain swirled through the tiny broken window, wetting his face as he stared out into the night. Orloff cursed, wiped the water from his face with his grimy fingers, and turned to pacing his cell once more. For seven long years Orloff had been thus confined – but a small fraction of the life sentence he was serving for the horrible crime he had committed. But at times he had asked himself, â€Å"Was it not worth it, after all?† He could still feel the wet, warm blood trickling between his fingers, and see the whites of his victim’s eyes. Then, too, there was that great day of the trial, when so many officials, in their splendid uniforms and gold braid, and so many beautiful women, clad in their furs and satins, had gazed at him, horror-struck, unable to avert their eyes from his face, or miss one word that fell from his lips†¦At such times Orloff would rub his hands and smile to himself, in memory of that great day. But tonight Orloff was in a different mood. Black despair and vengeance reigned supreme in his soul; he wished only to escape, in order that he might seek out his destroyers and in turn destroy them. His steps became more feverishly agitated; perspiration gathered on his forehead and he clenched his hands until the nails bit into his flesh and little trickles of blood oozed from between his fingers. A brilliant lightning flash illuminated the far wall of his cell –lighting it as it had never been lighted before. Orloff’s eyes became riveted upon a huge stone, on the lowest tier†¦Were his eyes deceiving him, or had he in truth seen a tiny crack surrounding it, as though the cement had been scraped away or altogether removed? Hardly daring to breathe he tip-toed across the room and fell on his knees before the stone, feeling its edges with his blood-stained fingers. Yes, there was a deep crevice surrounding it. And, what was more, the stone was loose. Orloff tugged at it, scraping the flesh from his fingers, sweat pouring from his face and matted hair†¦It moved†¦He pulled the great stone from its place and peered into the blackness beyond. Another lightning flash showed him what he had hardly dared hope for – a passage in the rock, leading downward from his place of torment. On the floor was a piece of paper, folded and yellow with age. With trembling fingers he carried it to the window, through which shone the faint rays of a lamp in the courtyard below, and there unfolded it. On it was a brief message, apparently written with some dark red fluid. For the first time in his life Orloff was glad that he had been made to read, if only a little. For on the paper was written: â€Å"I escaped by this passage. May he who finds this share my good fortune.† It was signed S.K. The tramp of the sentry’s feet resounded outside the door of his cell. Orloff threw himself over the stone till the footsteps had died away; then he thrust his head and shoulders into the opening, and began slowly to worm his way along the narrow passage before him. The walls of the passage were wet with slime and mould, and sharp, jagged rocks protruded, tearing Orloff’s clothes and scratching deep into his flesh†¦But of all this Orloff knew nothing. His eyes were gleaming, but only one thought was present in his mind –escape. He dug his bloody fingers into the mud and pushed himself steadily forward, flat on his stomach, like a serpent. As he advanced, the floor of the passage became steeper and steeper, sloping at an ever-greater angle. The walls became yet wetter and more slimy and the jagged rocks bit deeper into his writhing limbs. Foot after foot Orloff propelled himself along this narrow, sloping path. His breath came in short gasps, while the darkness seemed to become ever more intense. For one moment he paused, an agonizing fear shooting through him. He realized that it would be impossible for him ever to ascend that sloping passage to regain his cell. A cold shiver ran down his spine. Then, he clenched his teeth and propelled himself forward with the superhuman strength of despair. A sharp bend in the passage revealed a sight which made him gasp. A faint circular opening in the distance permitted the rays of the moon –which had fitfully begun to shine –to penetrate the stygian blackness. The end of the passage lay before him. Victory –escape! The cold night air fanned his face; he urged himself onward in a last desperate effort. The passage became ever more sloping as he advanced. His body was inclined at a sickening angle. Strange streaks of blackness seemed to cross his vision, as he half fell, half slid the few feet which yet remained to be traversed. Orloff’s head crashed into something hard, which half stunned him. A moment later he opened his eyes, and saw before him a heavily barred iron grating, and – a skeleton.

Chronic Obstructive Pulmonary Disease

COPD which is Chronic Obstructive Pulmonary Disease is known as a condition that progressively makes it harder to breathe because the airflow into and out of the lungs is reduced. This usually occurs because the airways and air sacs lose their elastic quality, the walls between the air sacs are destroyed, the walls of the airways become swollen, or if the airways are clogged because they made more mucus than usual. Three main conditions of this disease are emphysema, chronic obstructive bronchitis, and asthma. Most patients who suffer from COPD also suffer from emphysema and chronic bronchitis as to why they are commonly just defined as COPD. The patients who experience one or more of these conditions usually find it even more difficult to breathe. It is known to be a major cause of disability, and the fourth leading cause of death in the United States. It is said that approximately 12 million people have been diagnosed with COPD while another 12 million may have it and don’t even know it. COPD is mostly caused by cigarette smoke; however, pipe, cigar, and other types of tobacco smoke, as well as, second-hand smoke can contribute to this disease. This disease can also be caused by inhalation of air pollution, chemical fumes or dust either in the workplace or from the environment. COPD is usually found in patients of at least 40 years of age; however, it may affect a patient younger if they happen to have the genetic condition, which is alpha-1 antitrypsin deficiency. Alpha-1 antitrypsin is a protein made in the liver. This is an inherited deficiency that puts patients at a high-risk for lung disease. This deficiency occurs when the AAT proteins are not the right shape, which means they get trapped in the liver cells and cannot get into the bloodstream to travel to the lungs in order to protect them. Signs and symptoms of COPD are chest tightness, wheezing, shortness of breath, and also the â€Å"smoker’s cough. † The â€Å"smoker’s cough† is defined as an ongoing cough in which the patient produces large amounts of mucus. Severe COPD can cause symptoms such as weight loss and lower muscle endurance. If a patient is having a hard time catching their breath or talking, their not mentally alert, their heartbeat is very fast, their lips or fingernails turn gray, or blue or their recommended treatment which usually works isn’t work emergency treatment should be sought. If a doctor is attempting to diagnose COPD, he will first determine whether or not the patient is a smoker, then look into the patient’s family and medical history as well as their signs and symptoms. The doctor will also perform an auscultation using a stethoscope to listen for any wheezing or abnormal chest sounds. If the diagnosis process isn’t completed at that point, the doctor may then perform lung function tests. There are many different lung function tests; those are a spirometry, a peak flow meter, a lung volume measurement, a lung diffusion capacity, pulse oximetry, or an arterial blood gas test. A spirometry is a test to measure how much air you breathe in and out and how fast you blow it out. A peak flow meter is a small, hand-held device that shows how well air moves out of your lungs. A lung volume measurement like a spirometry measures how much air you can breathe in and out, however, it also measures the size of your lungs. A lung diffusion capacity determines how well oxygen passes through your lungs to your bloodstream. Last, are a pulse oximetry and an arterial blood gas test, both of these tests are used to see how much oxygen is in your blood. The arterial blood gas test is usually what is used to determine how severe your COPD condition is. After COPD is diagnosed, different treatments may be advised. There is no cure for this condition, but certain treatments may help a patient to feel better, remain more active and also keep their condition from progressing so fast. First, the doctor will tell you if you are a smoker the best thing to do is to quit. And, depending on the severity of your COPD your doctor may advise you to see a pulminologist, who is a doctor who treats patients with lung problems. Then, different medications may be prescribed such as bronchodilators, short-acting or long-acting again depending on the severity of the disease. Both are used to relax the muscles around your airways to help make breathing easier; however, short-acting is said to only last four to six hours, whereas, long-acting is said to last twelve hours or more. Most bronchodilators are used through metered-dose inhalers. Also, inhaled steroids may be prescribed to reduce the airways from swelling. Doctors will usually prescribe the steroid for a trial period of six weeks to three months. Other treatments to help this disease from progressing may be pulmonary rehabilitation, oxygen therapy, and vaccines to prevent the patient from the pneumonia or the flu. Rarely, a patient may be advised to have surgery such as a bullectomy, which is a removal of one or more very large bullae of the lungs, a lung volume reduction surgery, which is used to removed damaged tissue from the lungs, or a lung transplant may also benefit patients who suffer from COPD. Although emphysema, chronic bronchitis, and asthma are all conditions of this disease COPD, each condition affects the lungs slightly different. Emphysema is the condition that affects the lungs almost the same way because just like COPD it involves damage to the air sacs within the lungs; however, chronic bronchitis and asthma are different. Chronic bronchitis is known as a long-term inflammation of the bronchi, which causes increased mucus and other changes. Asthma occurs when the muscles in the bronchial tubes tighten and the airways become blocked by the extra mucus the airways are producing. Emphysema just like COPD is more progressive than chronic bronchitis or asthma. Patients with emphysema usually have shortness of breath and within later stages of the illness develop a chronic cough or sputum, whereas, patients with chronic bronchitis usually have a cough and develop sputum for many years before suffering from shortness of breath. And, for patients with asthma if proper treatments are followed then symptoms can be controlled. Causes of these conditions are also very similar. The most common cause for all of these conditions is smoking. The AAt deficiency can also play a role on patients who suffer from emphysema like COPD. Other causes for emphysema are known to be the HIV infection, as well as, connective tissue disorders. Other causes for chronic bronchitis can be from bacterial or viral infections. And, many different causes for asthma are airborne allergens, like pollen, mold, animal dander, dust mites, etc. , exercise-induced asthma, cold air, and certain medications, like beta-blockers, aspirin and other NSAID’s. It is said that the menstrual cycle in some women, as well as, the gastroesophageal reflux disease, which causes stomach acids to back up into the throat can lead to an asthma attack. And, allergic reactions to foods, like peanuts or shellfish can also cause an asthma attack. Symptoms of emphysema are known as a mild or chronic cough, loss of appetite and weight loss, and muscle fatigue. Symptoms for chronic bronchitis are known as a cough, spitting out of excess mucus, lips and skin may appear blue, abnormal lung signs, swelling of the feet, and heart failure. And, symptoms of asthma are chest tightness or pain, shortness of breath, a whistling or wheezing sound when exhaling, and trouble sleeping because of the shortness of breath, coughing, or wheezing. The diagnosis and treatments for both emphysema and chronic bronchitis are very similar as COPD, where pulmonary function tests, x-rays, and/or CAT scans may be performed to diagnose the condition. And different treatments may include bronchodilators, oxygen therapy, steroidal medications, and even possible lung surgery. Different procedures that may be used to diagnose the condition known as asthma are a methacholine bronchial challenge, where the patient inhales an asthma trigger called methacholine to mildly constrict the airways and a positive methacholine test will support the diagnosis. Another test is known as the nitric oxide test, which is used to measure the amount of nitric oxide you have in your breath. If your airways are inflamed, that is a sign of asthma. Medications that may be prescribed to treat asthma symptoms are inhaled corticosteroids, like Flovent Diskus, Pulmicort, Azmacort, Aerobid; Long-acting beta-2 agonists, which are long-acting bronchodilators; Leukotrine modifiers, theophylline. Also, short-acting bronchodilators may also be prescribed such as albuterol, atrovent, and oral and intravenous corticosteroids.

Organization Culture Exercise Essay Example | Topics and Well Written Essays - 500 words

Organization Culture Exercise - Essay Example The personnel of the organization are involved as well as specialized in the arrangements of intercultural dialogues, networks and relationships. The organization is also involved in promoting education among the poor people of several countries. Considering the transparent role that the company is playing in terms of bringing together the people of different countries for the promotion of culture, the organizational culture of British Council is an example to be followed by the same people who are involved in different programs initiated by the organization. Considering the discussion of the organizational culture, the Competing Values Framework is one of the most successful business models which can answer well about an organizational environment and its working. The significant traits of this model can be seen through figure presented below: The model presented above can be said to be perfectly executed in the organizational culture of British Council. The human resource development is the key aim within the organization according to which the morale of the individual employees of the organization is boosted through various means. The internal process of the company is very transparent in which all the employees have stability in their job and they have firm control over their duties. The key aim is the spread of the information through all the departments involved in the organization into a particular activity. Growth is another feature that the employees are expected to show in the organizational environment, which means that the employees have to be forward-thinking and have positive approach in carrying out a particular function, and this is one main feature that has been experienced by me in the British Council’s organizational culture. The employees of the BC are also expected to be efficient and productive and for which they have better resources by using which they can become more transparent in their approach that

Religious Liberty Essay Example | Topics and Well Written Essays - 1750 words

Religious Liberty - Essay Example It is, therefore, the very first amendment, introduced in the constitution in 1791, provides an absolute and unrestricted religious freedom to the masses, where the followers of all faiths are declared free to perform their religious practices without any prohibition, interference or restrictions from the state or government altogether. The first amendment in the US constitution states: Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof, or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble...† Runquist (2007) observes that the first clause prohibits the government from establishing a religion (including preferring one religion over another or over no religion). The second clause guarantees the free exercise of religion. Father of the US nation, George Washington, hand-wrote in his own personal prayer book that it is impossible to rightly govern the world without God and th e Bible (Judiciary House, 2011). Hence, the Americans are free to attend churches, mosques, synagogues, and temples without any checks on their religious performances from the state as well as from their religious opponents and rival communities. Religion can rightly be stated as one of the most fundamental elements of human life. Though it is a diversified subject, and thousands of faiths exist in the world, yet believe in the supernatural and metaphysical powers is common in all cultures of the world. An overwhelming majority of the people at global scale maintain that some Supreme Being certainly exists in the universe, which could solve all their difficulties and problems, and can protect them from the disasters and calamities they themselves are unable to combat with. Consequently, people develop emotional attachments with the deity they adore and do not allow any type of hindrance or obstacle that could stop them from displaying their sincere compliance, reverence, and worship to the deity. History is replete with the examples of horrible wars fought in the name of religion, which resulted in heavy and irreparable losses in men and material. Adherence to the religious teachings is not confined to one single community or social class only; rather, it is equally popular among the rich and poor and the strong and weak. It is, therefore, George W. Bush (2001) had declared the war of terrorism as the continuity of the crusade wars fought by the Christians against the Muslims in the medieval times. Judis (2005) submits to state that in putting forth his foreign policy, George W. Bush speaks of the United States having a calling or mission that has come from the Maker of Heaven. Thus, the religion is central in the life of the American people; it is therefore 79% of the population openly declares it as the follower of various Christian factions. Keeping in view all these facts and realities, along with the mental condition and sentiment of the people behind the m, the founder-leaders of the USA decided to offer unrestricted religious liberty to the masses in order to avoid and escape any unpleasant state of affairs for the future years to come. I

What It Means To Be A Coast Guard Wife Essay Example | Topics and Well Written Essays - 500 words

What It Means To Be A Coast Guard Wife - Essay Example In grasping the idea of protection as the chief aim of a coast guard on duty, a wife must instill in herself a gentle but firm heart at thoughtfulness when peril strikes and the better half guards someone else's life at the expense of his. More than awareness of how significant the profession is in times of real coastal emergencies, lifetime partnership with a man of the coast entails aligning thoughts, goals, and actions with the professional objectives of the latter. It means exhibiting a profound level of support to his cause that extends to getting involved in strengthening the man's faith in himself both emotionally and psychologically. Taking part in a routinary mission to prevent smuggling or intercept contraband trading is truly a tough work to accomplish so a coast guard's wife must possess the courage to accept any unforeseen circumstances especially the worst. She must not be susceptible to easily losing heart when her husband experiences distressing situations in the cour se of providing intense security in aiding vessels or merchant sailors for instance.

Nurses Involved in Lawsuits Research Paper Example | Topics and Well Written Essays - 750 words

Nurses Involved in Lawsuits - Research Paper Example Case ‘Patricia Fierle and Daniel Fierle, Husband And Wife, Appellants, vs. Jorge Perez M.D., Ltd., A Nevada Professional Corporation, D/B/A Sierra Nevada Oncology Care; Jorge Perez, M.D., Ph.D, MRCP, MRCPATH, An Individual; Linda Lesperance, R.N., APN-C, An Individual; Charmaine Cruet, R.N., APN-C, An Individual; and Melissa Mitchell, R.N., An Individual, Respondents.’ (Lexis-Nexis, 2009) The case was heard in the Supreme Court of Nevada. A brief history of this case is that it was also heard and dismissed in the district court, repudiating a post judgment motion (Lexis-Nexis, 2009). Overview Mrs. Fierle, Daniel’s wife was a patient under chemotherapy at the medical facility, Jorge Perez M.D., Ltd. She suffered burns on her skin as a result of this treatment and the husband and wife filed a case against Jorge Perez M.D., Ltd. They sued the facility but the action was dismissed by the court. The claims were of ‘medical malpractice’ (Lexis-Nexis, 2009), and the people who are the target were Jorge Perez, Linda Lesperance, Melissa Mitchell and Charmaine Cruet. The affidavit requirement of Nev. Rev. Stat.  §41A.071, (Lexis-Nexis, 2009) was applicable and the requirement was to file expert affidavits ‘non-res for ipsa loquitur claims’ (Lexis-Nexis, 2009), but the couple failed to attach them, however in case of assistants like the nurses, there is no such requirement, which is why under Nev. Rev. Stat.  § 41A.100 (1) (Lexis-Nexis, 2009), registered nurse was accused of professional negligence. Facts Patricia had been diagnosed with breast cancer in 2005 and she was under treatment at the John Perez medical facility, she had mastectomy, and a catheter was put in her chest, so that chemotherapy medicines could be instilled. One part of the catheter was attached to the subclavian vein, so this setting would let the caretaker administer the chemo medicine via a needle inserted in the catheter. Chemotherapy was to be admi nistered under the supervision of Dr. Perez and her nurses Charmaine Cruet, Linda Lesperance and Melissa Mitchell. Mitchell was the only registered nurse (being a registered nurse is very important for legal accusations). On her third visit, Patricia felt something was wrong during chemotherapy. According to the patient’s narrative, Mitchell’s chemo administration did not go into the catheter, instead it went into the tissue, causing a skin burn, known as the â€Å"extravasation† (Lexis-Nexis, 2009). She complained of the pain but medical attention was not given. The other day, a nurse noticed red spot on her chest and sent her to radiologist, which after ultrasound test, confirmed that catheter tip was not in subclavian vein but in the tissue. Patricia went to another doctor, Dr. Miercort, for her treatment, who also provided the affidavit for the case that â€Å"negligent extravasation† (Lexis-Nexis, 2009) had ensued by previous treatment. Patricia†™s claim in the court says that Mitchell failed to provide due care while administering chemo and that negligence caused her severe burn over her right shoulder and in subclavian region with epirubicin (Lexis-Nexis, 2009). Strategy to prevent it NSCA ("Standards and competencies," 2012) has issued a report how doctors and nurses can be extra careful while administeri

Discussion Assignment Example | Topics and Well Written Essays - 250 words - 31

Discussion - Assignment Example Jurisdiction specifications and legal aspect consideration are other inputs that the company might use in an investment policy. Jurisdiction specification may include other inputs such as environmental, social, and governance standards, classes of assets and guidelines to ensure effective collaboration with external managers. Primary market differ from secondary market in such that, for the primary market, the organization or company is involved directly in the transactions, while in secondary market, there is no involvement between the company and the transactions because transactions occur between investors (Hall and Lieberman 405-406). Both market segments are inter-related and they influence each other in terms of performances. However, the primary market success and functionality is dependent on the secondary market’s complementary role in providing and opening a business opportunity for primary investors. As a result, the secondary market forms the baseline for investors in primary issues to transact on their investments that give other investors a chance to invest in the company. Consequently, primary market functionally dependant on the secondary

Business Communication Essay Example | Topics and Well Written Essays - 1500 words

Business Communication - Essay Example An in-depth study of women in management settings, conducted by Korac-Kakabadse and Kouzmin revealed several insights into how communication is often a key factor in women not achieving the same level of power as men in the workplace. It explored the differences in their manner of communication and the way that these differences lead them to have less power. He pointed out, for example, that even the terminologies used in a workplace used to be male-oriented. (Korac-Kakabadse and Kouzmin, 1997, pp. 190-193) As researchers have observed, several positions in an organization would have titles such as â€Å"chairman† or â€Å"salesman†, making them seem like jobs that are designed for males only. Furthermore, women occupied some positions so often that these job titles were associated only with women. Some of the most well known examples of this are â€Å"secretary† and â€Å"manager’s assistant. The reason why this point is essential to this critique is tha t these job titles, both the ones associated with males and the ones associated with females, were altered around the same time that the role of women in the workplace started gaining more power. Women, whom these stereotypes had suppressed for a long time, stood up and fought for change, and achieved it. They had the male associated positions changed to â€Å"chairperson† and â€Å"salesperson†.... In addition, the women-associated job titles now stand replaced by more male-oriented titles such as â€Å"office manager† or â€Å"assistant manager† (Pringle, 1992, pp. 127-60). Even generic terms like â€Å"mankind† now stand replaced with less sexist words like â€Å"humankind†. This is an indicator of how women who seek power started by altering the communication strategies in the world around them, in both the workplace and otherwise. Thus, this supports the theory that communication strategies have a large bearing on the power that women possess in the workplace. Another important area in communication that affects the power that women have in the workplace is nonverbal communication. As researchers have found, even the difference in tones that women and men use often affects their power disparity in the workplace, regardless of the content of their speech. Due to the different roles men and women adopt in their lives, they often develop tones of sp eech accordingly. A man will more likely have a strong and confident voice whereas a woman will have a soothing and comforting tone (Willis, 1990, pp. 40-72). This difference makes it appear that the man is more capable of taking charge in the workplace, whereas the woman is more suited for a less power-oriented career. It would also explain why men are more likely to be trusted with managing and leading large workforces, while women are employed to work for them. This again supports the view that women need to alter their communication strategies if they wish to have more power in the workplace, even if it is their non-verbal communication. A few more studies have observed the communication strategies used by men and women, and have found some startling differences when

Strategic Plan Research Paper Example | Topics and Well Written Essays - 2000 words

Strategic Plan - Research Paper Example As the consumer demands are ever changing, this industry has also constantly evolved over the years. Emergence of new entrants and constant innovation by the existing firms in this industry has induced tough competition. Companies are now planning strategies to increase the sustainability of their organization’s growth. The present report aims to identify the business drivers of Wal-Mart retailer and prepare an effective strategic plan for future growth and development. Company description Wal-Mart is the largest corporation in the world. It is also the biggest private employer in the United States of America (Yoffie & Wang, 2002). However, the company was first established as a self-service discount store by Sam Walton, in the year 1962. At the end of 1993, Wal-Mart was one of the top discount departmental stores in the world. The company is headquartered at Bentonville, Arkansas, United States. The company has established more than 8500 stores across the globe. Product portf olio of the company includes, apparel, warehouse club, footwear specialty, cash & carry, supercenter, superstore, discount store, hypermarket, supermarket. Wal-Mart resource and capabilities The brand name of Wal-Mart has become synonymous to value for money over the course of time. Wal-Mart follows a low cost and leadership strategy (Johnson & Scholes, 1999). Macroscopic view of Wal-Mart’s competitive strategy shows that the company uses resource based model in order to develop a value chain proposition which cannot be matched by competitors. Though Wal-Mart shows little adaptability to its formats in overseas expansions, most of its store operations are leaders in their local areas (Colla & Dupuis, 2002). The fundamental principles followed by the company are providing everyday low prices, commit to customer service and maintain technological superiority and establishing loyalty among suppliers and associates. Supermarkets of Wal-Mart in international location have less fin ancial risk due to bulk sales. About 10 billion dollars are saved by the American customers by shopping at Wal-Mart (Buffet, 2003). Competitive advantage for Wal-Mart lies in its ability of cost differentiation and strong distribution channel across the globe (Van Weele, 2009). Current direction Global economy is decelerating due to various reasons such as Euro zone crisis and economic recession which started in the year 2008. Retailers such as Marks & Spencer, John Lewis, Target, Wal-Mart, Kohl and others are struggling to maintain sales growth while other retail players such as Nordstrom, Saks and Neiman Marcus have recorded same store sales growth of 12% last year (Arnold, 2002). Global retailers are facing following trends to change the dynamics of business operation. This has compelled organizations like Wal-Mart to make strategic plan in order to remain profitable and competitive in this dynamic market (Simon et al., 2011). The objective of the current strategic direction will be to evaluate the resources and capabilities of the retail gain and make appropriate recommendations for future planning. SWOT Analysis In order to understand the internal and external strengths and weaknesses, a SWOT analysis of Wal-Mart has been done. Strengths With revenue of more than 400 million dollars, Wal-Mart is undoubtedly one of the largest retailers in the world. As a result of large operational scale, the company can exercises strong power on suppliers in order to

The Impacts of Global Media on Local Cultures and Identities Dissertation

The Impacts of Global Media on Local Cultures and Identities - Dissertation Example Since the overall impact of globalization is diverse i.e. social, political, cultural, economic, media etc. therefore it may be relatively difficult to define globalization according to certain fixed parameters. Although it would be very difficult to believe that any of these views are absolutely right, but nevertheless globalization and its relationship with the media should not be ignored outright Media plays a vital role in creating the link between the different cultures and works as the fastest mode of spreading the aspects of the world cultures. This may create good or bad impacts on local values and culture, grasped or adopted by the local people resulting in the so-called hybrid culture. Hybrid culture is one of the emblematic notions of the present era. Invent of global media has extended people knowledge and has resulted in the exchange of cultural information and identity. Hybridizing process has helped old cultures tradition to recruit new entrants; nevertheless this cros s cultural relationship has only been successful when it is favored by both social and political incentives. Hybridity involves fusion of two or more distinct cultural formats to mix for example their styles, identities and even cross cultural contact. These are said to be the primary requirements for cultural hybridity This movement of contact and exchange of information is believed to be initiated by the evolution of media or by the movement of people through migration from one place to another. Media evolution helped this exchange of information and contact at relatively an easier way through the exchange of ideas and communication skill. This research is intended to develop an understanding of the impact of global media on local cultures in the Middle East with a specific focus on the United Arab Emirates. The Research looked at the numerous theories on the impacts and critical interpretations of the global media on local cultures. During the research, it emerged that the global ization of culture and media has relatively low effect on the local culture. Though globalized media is flourishing within UAE and Dubai specifically, however, the local values are still intact with no or relatively little change. One significant impact however, is that of the increased use of English language and low level of interest towards using mother tongue. Apart from this, the traditional tribal values, family bonds as well as day to day living of ordinary Arabs in Dubai is relatively same. This research focused upon understanding the interaction of global culture and media with that of the local culture in UAE and Dubai and found out that local culture is gradually being affected by the global media such as social media networks and satellite channels. However, flourishing of satellite TV channels like Al-Jazeera has strengthened the local culture while at the same time offering global contents and exposure to globalized media and cultures. Dubai’s culture as such ha s not changed much despite the fact that international tourism is on the rise

Football essay Essay Example for Free

Football essay Essay It’s easy to see that Football is the most fun sport ever invented. To be a promising football player you have to poses physical, mental talent. Above all the qualifications of becoming a football player, I think respect on the field is a necessity. Respecting players and plays will most certainly bring you closer to a career as a football player. The game of football has been proven to be more of a mental than physical but physical abilities are also important. It’s good to work out for physical ability, but a rest is essential to achieve the goal. Each football team has an offense and defense. The referee calls all the decisions on the field. Recently, a player was tackled by the neck, so the referee called unnecessary roughness penalty. It’s good to be physical but referees are trained to watch out for the safety of players. I played football as a wide receiver at Burlington High School. I loved every second I was on the field playing offense. Of all the receivers that have ever played in the National Football League, Randy Moss is my favorite. In his prime time, he made amazing catches to give his team a chance to win the game. Thinking who far he had come, Randy Moss made every moment count. Running down the sidelines of the defense, he was able to out run any defender trying to tackle him. Holding the ball in his hands, he was fierce as teams needed more than one defender to tackle him. To me Randy Moss is more than a player, he is a mentor and inspirational to all the football fans. To accomplish the success that he had, he had to put in extra practice work and mental awareness of the opponent. I always wanted to be like him and able to play football like him. Football is that kind of a sport where by the harder you practice, the better you get. Now that he has retired, Calvin Johnson is the only other active receiver that I can compare him to. Before the super bowl each year, fans all over the nation gather around and get ready for the game. It is the most watched championship game each year in all sports. Because the game is viewed by millions of people, companies get the opportunity to advertise their products to people. Just as companies want to advertise their products, they are also required to show off their creativity in the commercials. Each super bowl game, there is a commercial that wins peoples favorite vote for most creativity. In High School the coach always told the players if you forget what you supposed to do on the field; I will be glad explain. Football is a team sport; the success of the team is determined by how much work each member puts in. I will want some day help build football fields for kids to play; that is a promise I make.

Attitude of Unlisted Companies Towards IFRS

Attitude of Unlisted Companies Towards IFRS SECTION I INTRODUCTION The adoption of international financial reporting standards across the European Union from 1st January 2005 is one of the biggest events in the accounting history. This is especially important after the capital markets were rocked by some big accounting frauds in recent years. In the first phase, 7000-plus listed European companies will have to implement new financial reporting standards from January 2005 (Fuller, Jan 2005). When European Union moved towards one market across Europe, it faced the prospect of different financial reporting regimes across EU participants. To achieve true scale of financial integration, it has become necessary to adopt common financial reporting standards. In June 2002, the European Commission adopted a regulation requiring all listed EU companies in regulated markets to prepare their financial statements in accordance with International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS). The regulation is applicable only on consolidated accounts and companies are free to choose their national GAAPs for subsidiaries and associate companies. The regulation came into force from January 2005. Companies Act 1985 governs the use of UK GAAP by UK based companies. Similarly other EU states have their own laws for accounting standards. The EU states have now modified their national laws to include IFRS regulation to offer a common financial reporting standard. Companies Act 1985 (International Accounting Standards and Other Accounting Amendments) Regulations 2004 has extended the application, on a non-compulsory basis, of the EU IFRS regulation to all non-charitable organisations. In the last quarter of previous century, the world economies have moved towards globalisation. Multinational companies are manufacturing and selling across the world and many of these firms are listed at foreign stock exchanges. Globalisation of markets and establishment of multinationals led to increased desire and awareness about international markets. This was soon followed by globalisation of financial markets which increased the value of understanding of international financial results and reporting formats. Rapid improvement in communication technologies and easy access through internet has further spread the profile of international investor. Now a day international investors are not limited to some portfolio managers in big banks. International investors are now as diverse as sophisticated equity manager to a small investor in a remote town. Investors too have diversified their portfolio by international equities and bonds. This rapid globalisation has fuelled the desire to h ave common international standards that could be understood and followed across nations. The ever increasing network of investors has not only opened new financing sources to countries, it has also put some pressure on the financial regulatory authorities to design and improve their financial reporting systems in a manner that is easily understood by wider audiences. The regulatory authorities have on one hand evolve the financial reporting system to match the ever increasing demands of international investors and on the other hand make sure that companies in their countries are not faced with sudden increase in time, resources and knowledge needed to cope with new regulations.   In 1973, 9 countries included UK formed International Accounting Standards Committee (IASC) with an aim to develop common accounting standards. The membership has now grown well over hundred countries with each country, especially bigger economies, bringing in their own perspectives of accounting standards. IASC had to deal with accounting conflictions in coming up with common acceptable accounting standards. One would immediately think whether IASC has been successful in resolving all the conflicts with all member countries and the answer would easily be no. To fully satisfy more than hundred accounting bodies from across the world is almost an impossible task. Yet IASC has done a commendable job and from 1 January 2005, International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS) is applicable in more than 90 countries. In EU, IFRS is compulsory only for listed companies. The standards that UK listed companies will follow are not those issued directly by the International Accounting Standards Board, but are those that have been endorsed by the European Commission. EU has now endorsed IFRS, except for IFRS 6 and some of the IFRIC interpretations, and some changes in IAS 39 relating to the fair value of financial instruments (PwC, 2005a). While the EU regulation is only enforceable on listed companies, it also says that a member state has an option to extend the use of IFRS to unlisted companies within their jurisdiction. Department of Trade and Industry (DTI), the government trade body responsible for company regulation in UK, has said that while there is no mandatory move to IFRS for unlisted companies, the unlisted companies would still be allowed to adopt IFRS over UK GAAP from 2005 onwards. The basic aim of new financial reporting standards is same as that of existing standards – to provide information about financial performance and position of a company to different stakeholders. Internal stakeholders – management – normally have a good grip of what’s going in the business. It is external stakeholders like investors, auditors, suppliers and creditors who need to be informed in a succinct and clear manner about financial implications of business decisions. The IFRS would aim to present a more complete picture of a business by making operating income a more encompassing number. As an example, the financial implications of stock options were kept out of income statements. Companies merely mentioned the number of stock options granted. But now onwards, companies will have to incorporate the fair costs of granting stock options in their income statements. This will allow investors to assess the true costs of executive remuneration. Though the overall aim is same, the differences in implementation and financial reporting do occur due to social, economic and political backgrounds of different nations. Will it be a good policy to allow two different accounting standards in UK – one standard for listed companies and another for unlisted companies. UK’s Accounting Standard Board clearly sees there is no merit in having two separate standards. ASB issued a Discussion Paper in March 2004 highlighting its strategy for convergence with IAS and says that convergence of UK accounting standards to IAS is a foregone conclusion. It has already introduced many changes in recent past to bring UK’s GAAP in line with IFRS. Smaller companies, even listed ones, will find it difficult to cope with extra work due to IFRS. Alternative Investment Market (AIM) realises that most of its companies won’t be in a position to meet IFRS requirements soon. So it changed its regulatory status in October 2004 and is now an â€Å"exchange regulated market† and out of purview of European Commission regulation on regulated markets. Now companies listed on AIM have time until January 2007 to implement IFRS. Accounting Standards Board is also sensitive to the needs placed on business in making a transition from UK accounting standards to IFRS. Big businesses probably have sufficient resources to cope with the change in one year. But the smaller businesses will find it difficult to make all required changes in one year. ASB has proposed a series of changes that would be implemented in 2005 and 2006 which will bring UK financial reporting standards more in line with IFRS. Thereafter ASB will carry out a series of step changes by replacing one or more UK standards. So by the end of 2005-2006, UK standards will almost be in line with IFRS and unlisted companies transition to IFRS in 2007 would be smooth. This research analyses the attitude of unlisted companies towards IFRS. Many research and surveys have been carried out on the acceptance and readiness of listed companies for transition to IFRS. But the issue has not been explored in depth with respect to unlisted companies. The research is based on primary and secondary data. Primary data is collected via interviews and questionnaires with companies and their auditors. A total of [34] interviews – [20] with companies and [14] with their auditors – were conducted to obtain primary data. [52] questionnaire responses by postal survey were also analysed. The results show that there is definitely a much scope in improving International Financial Reporting Standards for unlisted companies. Respondents were concerned about the costs associated with transition to IFRS and also the additional burden that will come with regular enhanced reporting. That IFRS will help in globalisation of capital markets and probably cheaper costs of capital is not of much significance for unlisted companies registered in UK. This research would be useful for institutes and associations framing accounting standards for unlisted companies. Mostly accounting standards have been framed with an eye for listed and large companies. But unlisted companies have much lesser resources to spend on large regulatory requirements and hence should have different reporting requirements that match the benefits obtained from such reporting. The time limitation and resource constraint mean that the primary data via interviews and questionnaire surveys could only be collected through a limited number of respondents. It would be useful to cover a larger data base before implementing the changes. Also more users of data in unlisted companies like banks and creditors should be contacted before policy formulation. The remaining paper is divided in the following sections. Section II is a literature review on justification and applicability of IFRS, and state of readiness in companies. Section III discusses the methodology used in this research. Section IV covers analysis of data obtained through the primary data collection and its interpretation. The paper concludes with section V. SECTION II LITERATURE REVIEW In June 2000, the European Commission proposed a new directive requiring that all publicly traded companies in the member states to adopt International Accounting Standards Board (IASB) standards by no later than January 2005. On 19 July 2002, the European Parliament and the Council approved the IAS regulation (EC) 1606/2002 which said ‘For each financial year starting on or after 1 January 2005, companies governed by the law of a Member State shall prepare their consolidated accounts in conformity with the international accounting standards adopted †¦ if, at their balance sheet date, their securities are admitted to trading on a regulated market of any Member State’ (EU, 2002). Rationale for EU’s adoption of International Financial Reporting Standards The main aim of International Financial reporting Standards is to bring convergence among different national financial reporting standards. Over time, the evolution of different national financial reporting standards has been influenced by local social, political and economic environments. Some of the major reasons for differences in accounting standards are: Political – Capitalist or Communist. Capitalist and communist countries have almost contrasting fundamental economic approach and their accounting standards reflect the same. Stage of economic development. Developed countries generally have better accounting standards in terms of transparency and clarity. Corporate finance – debt or equity. Companies in continental Europe are financed more by debt than the companies in UK. Accounting standards have over time evolved to reflect the importance placed by different sources of financing on different aspects of financial statements. Legal and taxation systems. Convergence will help investors and analysts to compare companies across borders in a better way. But it also implies that either member countries will lose their independence to make national accounting standards that reflect local economic conditions or if they start introducing some changes, IFRS may slowly lose its main strength of common standard. Local, political and economical conditions may force national accounting bodies to introduce variations in IFRS. EU has already introduced some changes in the IAS 39 dealing with financial instruments. It is beyond the scope of this research to see which member countries have introduced variations in IFRS. Convergence between UK GAAP and IFRS ASB has declared its intention to converge UK GAAP with IFRS. It has issued a number of new standards in December 2004 to speed up the convergence of UK GAAP with IFRS. So sooner, even unlisted companies would be following a substantial portion of IFRS due to this convergence. Comparison of UK GAAP and IFRS Similarities The ultimate goal of UK GAAP and IFRS is same – to present information about financial performance and position to all concerned stakeholders. If the aim is same, then should be the main approach adopted by both accounting standards. The UK’s Accounting Standard Board’s Statement of Principles for Financial Reporting is a vital contributor at macro level standard setting. It plays almost same role as International Accounting Standards Committee’s ‘Framework for the Preparation and Presentation of Financial Statements’. ‘It is a description of the fundamental approach that the Accounting Standards Board (ASB) believes should, in principle, underpin the financial statements of profit-oriented entities’ (ASB, 1999). The Statement of Principles has true and fair concept at its core, much like the focal point in International Accounting Standards. Also like IAS, Statement of Principles insists on financial information being relevant and comparable. It is beyond the scope of this research to highlight each and every similarity between UK GAAP and IAS. Differences Though the overall aim is same, the differences in implementation and financial reporting do occur due to social, economic and political backgrounds of different nations. Main concepts behind UK GAAP and IFRS are same, but when we look at micro level, we see many differences at the individual standards level. Following are the main differences between UK GAAP and IFRS: The Statement of Principles allows use of both historical cost and current value approaches in measuring balance sheet categories. The dual use of historical and current value methods is known as modified historical cost basis (ASB, 1999). Under historical cost, the carrying values of assets and liabilities are stated at the lower of cost and recoverable amount. This approach is more conservative as compared to IAS approach which uses fair value method. Also the choice of historical or current value method is based on subjective analysis of a company’s management and hence it is open to some manipulation. Fair value. If we look at global level, both UK GAAP and IFRS have adopted fair value method as the foundation of their accounting standards. IFRS takes fair value adoption even higher when it says that income statement will include the changes in the fair value of items that have not been yet traded like derivatives. The emphasis in new accounting standards is on mark-to-market fair value of assets and liabilities rather than on actual market price based fair values. Now both realised and unrealised changes in fair values would be incorporated in income statements. The first year of transition will see high volatility in earnings and balance sheet statements. Though this brings higher volatility, it will also test the management skills in proper presentation and explanation of changes. It may also change the benchmarks of success for managements. Acquisitions. Acquisition accounting will change under new accounting standards. Under UK GAAP, companies can choose between purchase and merger accounting. Under IFRS, companies will have to account under purchase method only. Goodwill. UK GAAP allowed amortisation of goodwill and companies had the option of not segregating intangible assets from goodwill. Under IFRS, intangible assets have to be separated from goodwill. Goodwill can not be amortised now but companies will have to undertake annual impairment tests to justify the value of goodwill on the balance sheets. BAT’s profits for year 2004 increased by  £454m because it no longer had to amortise goodwill of that amount (AccountancyAge, 2005b). Consolidation of accounts. Under new accounting rules, companies may have to consolidate certain additional subsidiaries into group accounts. On the other hand companies will have to exclude certain subsidiaries or special purpose vehicles which were not included till now. Research and development costs. Under IAS 39, research costs can’t be carried on the balance sheet and would have to write them off as incurred. Companies would still be allowed to capitalise development in line with UK GAAP. Stock options. Internet and share market last boom in late 1990s led to rapid increase in share options as a way to reward employees. The new requirements to record an expense on income statement for the value of share options granted to employees could have a significant impact on earnings. AstraZeneca said in its pro forma 2004 IFRS numbers that new accounting rules on stock options has made it re-consider the use of stock options in rewarding its employees (Tricks, 2005). Distributable profits. Organisations ability to pay dividends is dependent on their distributable profits. Following are some of the major impacts of IFRS on distributable profits Inability to discount deferred tax liabilities, higher provisions for deferred tax when companies move from historical costs to fair value and inclusion of pension deficits in income statement. All of the above will reduce distributable profits. Many companies would have to financially restructure themselves in order to have sufficient distributable profits to meet dividends paid in last year. Deferred tax credit. Deferred tax credit is available under UK GAAP but not under IFRS. GlaxoSmithKline’s restated its 2004 earning per share by (1.9p) due to non-availability of deferred tax credit under IFRS (AccountancyAge, 2005a). Inclusion of business disposals gains in profits from operations. BAT’s profits for year 2004 increased by  £1.3bn after it included gains from disposals to operating profits (AccountancyAge, 2005b). Adding disposal gains to operating profits will make it harder for investors and analysts to separate the earnings from continuing businesses. Derivative contracts. Under IFRS, some derivative contracts will not qualify as hedges as they wont meet the criteria. UK GAAP allowed deferment of such contracts until transaction took place. IFRS won’t allow the deferment of such contract and would impact the profit and loss account even before the transaction took place. It is better in a way that investors will know the current value of the firm as on date rather than historical costs of such instruments, especially if the duration of financial instruments was long. At the same time, it would increase the burden on the company to calculate the fair value of all such transactions. Agricultural. UK GAAP allowed companies to use a cost model for biological assets and all agricultural produce. But under IAS companies would have to use mark to market method for valuing such assets. Now companies would have to use market valuation even for assets in far off countries. Advantages of IFRS over UK GAAP Common financial language. Adopting common financial reporting standards will open up a company to more markets and investors. The growth in telecommunications has made it easier for smaller investors to invest across physical boundaries. Such investors are normally not as financially sophisticated as some big financial institutions. They would also not like to understand more than one accounting standards as they don’t have required resources in hand to do so. With one common accounting standard, more investors would like to explore companies across nations. Acquisitions. IFRS 3 is more open and transparent than UK GAAP on acquisitions. It will allow investors and analysts to judge faster the success of an acquisition. Many of the companies that have relied on acquisition as a key cornerstone for growth would now come under intense scrutiny and may have to develop a new strategy for growing business.    Consolidation. In IFRS, all entities will have to provide a cash flow statement. Additionally there would be more transparency within the group companies and this should make the consolidation process more straight-forward. Securitisation by businesses is likely to be impacted by the new ways governing how companies can show assets and liabilities on their financial statements. Companies have used securitisation to cash in assets like trade receivables sitting on their balance sheets. Securitisation helps companies to slim down their balance sheets and hence allows companies to show higher return on assets at same earnings. And it was one of the reasons why companies went for securitisation. But stringent criteria for moving assets and liabilities off balance sheet will threaten securitisation. Sue Harding, chief accountant at Standard Poor’s in Europe said that new international accounting standards were sweeping a lot of securitised assets back on to balance sheets (Jopson, Feb 2005). This will help investors compare like to like and avoid companies that have used securitisation only to make-up their balance sheets. There is no harm in using securitisation if used in a proper way and not to deceive stakeholders. But we have seen how corporations like Enron had used securitisation to disguise their true financial position. Annual impairment review. Annual impairment review will benefit investors because the companies then won’t like to take big goodwill cuts in one year and not do anything for years. Annual reviews would help investors judging whether the amount paid by companies in acquiring other company was justified or not. Access to cheaper capital. Increase in investor profile diversification would most probably lower the cost of capital for most of the companies. This is especially true for smaller companies which don’t have financial muscles and resources to tap international investors. Expensing research costs gives better information to investors and other stakeholders because at research stage the chances of success are quite uncertain. Investors can only be sure of development costs bringing in some returns in future. Also by segregating research and development costs, external stakeholders will now have a better chance to differentiate the suitability of costs incurred in developing new products. Multiple listings. Many companies now have multiple listings across different countries. Companies need to prepare financial statements as per each local accounting standard to meet listing requirements. With one accounting standard only it will save a lot of botheration for companies with multiple listings. Dividends. Under IFRS dividends are not provided for until the dividend recommended by the Board is approved by shareholders. This move will bring more convergence between accounting profits and cash flows. Disadvantages of IFRS Fair value. While fair value in a way conveys more up to date value of a company as compared to historic costs, it also puts a question mark on the methods used and the reliability of fair value. Derivative instruments which are commonly traded on various stock exchanges can be easily assigned value. So while valuing some of the assets or liabilities may not be difficult, the question still remains what impact such valuations will have on companies’ business models. Many companies use hedging instruments as a strategic tool rather than for intentional gains. Any short-term swings in such instruments may have a significant impact on income statement and probably adverse market reactions may deter companies’ from using such instruments. Then comes the more important issue of valuing assets and liabilities that don’t have a proper market. The companies may use some valuation model, which itself may not be the right way, to value an asset or liability. The model will incorporate some subjective assumptions. An example would be brand value. A same brand can have two different values for two different companies because of its strategic importance. So at one hand, investors and other external stakeholders are getting more objective information about a companies’ assets and liabilities, they are also getting valuation based on more subjective assessments. Only time will tell whether some individuals or companies will use it to manipulate results. An interesting thing to observe would be the treatment and importance given by analysts to unrealised fair value of assets and liabilities. Some investors may try to separate unrealised gains and losses from other operational performance. It may also prompt companies to issue adjusted earnings excluding unrealised gains and losses. An important point to note about fair value principle is that the financial statements should not be seen as perfect prediction of things to come. That depends on the strategic and business decisions management will take in future. Just having a fair value of assets and liabilities doesn’t mean that the company will be able to extract those values in future.    Dividend. New accounting standards promote payment of dividend from distributable reserves. With the inclusion of unrealised gains and losses and pension deficits, the first few years of new accounting standards may not leave enough of distributable reserves for dividend payments. Securitisation. Securitising assets into special purpose vehicles and re-financing them through had also helped companies raise funds at lower costs. The new accounting standards by restricting the use of special purpose vehicles, would diminish some sources of cheap financing. It is question yet to be fully tested in the practical world that since the assets are same, change in financing options shouldn’t change the returns on total assets. By refinancing at lower rates through securitisation should result in higher financing cost for remaining assets such that the overall costs remain same. But examination of this hypothesis is beyond the scope of this dissertation. But what is mostly observed in capital markets is that when companies announce refinancing, the share price rises. How much of the rise is from relief that company will survive and how much from the fact that the overall costs have lowered is not known. Annual impairment tests. Annual impairment tests are easier said than done. Companies would not only have to devote substantial resources to do that first would have to train its personnel to do that. Assessing true value of a goodwill is not easy. If there is a comparable market then companies can easily value it. Even then it may differ from case to case as it would be very unusual to see exactly two similar companies. Goodwill is very different from tangible assets or technologies and depends a lot on market perception and strategy. Companies would have to review the whole process of valuing goodwill and would have to review the valuation process at constant intervals. Net pension liability. The inclusion of net pension liability on the balance sheet may have severe impact on the shareholders funds. Companies will be required to have annual actuarial valuation of their pension liabilities and the same would be reflected in financial statements. Most of the pension funds invest in equity markets, which have been quite volatile in the recent years. So though over a longer period, the movements in pension liabilities may even out but in short to medium term, it may have a dramatic effect on balance sheets and earning statements. Segmental information. IAS 14 requires companies to report information on their business segments and on a scale more detail than UK GAAP. As of date, no agreed accounting practices have emerged on how much should be disclosed because companies may end up revealing sensitive information to its competitors. If companies disclose the turnover, earnings and expenditure for each segment, its profitable operations may come under intense competition. Ian Dilks of PwC said that â€Å"some companies have found they’re giving much more information than they’re comfortable with on sales and the profitability of product areas† (Tricks, 2005) Expensing research costs may result in listed companies focusing more on products in development stage than in research stage. This will keep their balance sheets healthy but may harm long term prospects. Complex and long IFRS compliant reports. PricewaterhouseCoopers estimates that an IFRS compliant financial report for insurance companies could be up to twice as long as those prepared under existing UK GAAP (Finn Zoon, 2004). The requirement for other industry sectors though may not be as intensive as for insurance sector, their IFRS compliant financial may also be longer and resource intensive than under UK GAAP. Any company that has makes an acquisition will have to do annual goodwill impairment analysis and most of them would like to explain the results also. Comparable formats. IAS 1 is less prescriptive than the UK GAAP when it comes to the format of the balance sheet and income statement. It just distinguishes current and non-current assets and liabilities. Investors, when faced with different formats, may find it difficult to compare companies. Modify organisation structures. Meall (2003) suggested that the additional burden of more financial reporting along different segments may force companies to modify their existing organisational structures within their financial systems to collect and analyse data. Impact of IFRS on different industries IFRS will have different impact on different industries. For some, most of the applied UK GAAP is almost same as IFRS and won’t feel the difference. But for some industries, the difference in accounting standards may have a substantial impact. Financial services and insurance companies are among them. Financial services companies would be affected by substantial change in recognition and measurement of financial instruments under IAS 39. UK GAAP has no equivalent to IAS 4 which deals with insurance contracts. Insurance companies would now have to account for this in their financial statements. Under IFRS, insurance companies would have to book financial instruments such as derivatives at market value rather than historical value allowed under UK GAAP. Many insurers have said that this will distort their earnings (Reuters, 2005a). IFRS will put more stringent criteria for classification of insurance products and this may lead to reclassification of some insurance products as investment products. Other industries that might face higher impact are the ones that heavily use hedging instruments in their day to day operations. Mostly companies using commodity materials like oil as a significant part of their input costs use hedging to smooth over the volatile changes in commodity markets. New accounting standards will reduce Tesco’s projected annual profit of  £2,000m by  £30m only, a reduction of 1.5%. But for some companies the impact would be much more. Royal Sun Alliance said that new accounting rules would reduce its net assets by  £400m (Reuters, 2005a). This is a big number by any standards and shareholders Attitude of Unlisted Companies Towards IFRS Attitude of Unlisted Companies Towards IFRS SECTION I INTRODUCTION The adoption of international financial reporting standards across the European Union from 1st January 2005 is one of the biggest events in the accounting history. This is especially important after the capital markets were rocked by some big accounting frauds in recent years. In the first phase, 7000-plus listed European companies will have to implement new financial reporting standards from January 2005 (Fuller, Jan 2005). When European Union moved towards one market across Europe, it faced the prospect of different financial reporting regimes across EU participants. To achieve true scale of financial integration, it has become necessary to adopt common financial reporting standards. In June 2002, the European Commission adopted a regulation requiring all listed EU companies in regulated markets to prepare their financial statements in accordance with International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS). The regulation is applicable only on consolidated accounts and companies are free to choose their national GAAPs for subsidiaries and associate companies. The regulation came into force from January 2005. Companies Act 1985 governs the use of UK GAAP by UK based companies. Similarly other EU states have their own laws for accounting standards. The EU states have now modified their national laws to include IFRS regulation to offer a common financial reporting standard. Companies Act 1985 (International Accounting Standards and Other Accounting Amendments) Regulations 2004 has extended the application, on a non-compulsory basis, of the EU IFRS regulation to all non-charitable organisations. In the last quarter of previous century, the world economies have moved towards globalisation. Multinational companies are manufacturing and selling across the world and many of these firms are listed at foreign stock exchanges. Globalisation of markets and establishment of multinationals led to increased desire and awareness about international markets. This was soon followed by globalisation of financial markets which increased the value of understanding of international financial results and reporting formats. Rapid improvement in communication technologies and easy access through internet has further spread the profile of international investor. Now a day international investors are not limited to some portfolio managers in big banks. International investors are now as diverse as sophisticated equity manager to a small investor in a remote town. Investors too have diversified their portfolio by international equities and bonds. This rapid globalisation has fuelled the desire to h ave common international standards that could be understood and followed across nations. The ever increasing network of investors has not only opened new financing sources to countries, it has also put some pressure on the financial regulatory authorities to design and improve their financial reporting systems in a manner that is easily understood by wider audiences. The regulatory authorities have on one hand evolve the financial reporting system to match the ever increasing demands of international investors and on the other hand make sure that companies in their countries are not faced with sudden increase in time, resources and knowledge needed to cope with new regulations.   In 1973, 9 countries included UK formed International Accounting Standards Committee (IASC) with an aim to develop common accounting standards. The membership has now grown well over hundred countries with each country, especially bigger economies, bringing in their own perspectives of accounting standards. IASC had to deal with accounting conflictions in coming up with common acceptable accounting standards. One would immediately think whether IASC has been successful in resolving all the conflicts with all member countries and the answer would easily be no. To fully satisfy more than hundred accounting bodies from across the world is almost an impossible task. Yet IASC has done a commendable job and from 1 January 2005, International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS) is applicable in more than 90 countries. In EU, IFRS is compulsory only for listed companies. The standards that UK listed companies will follow are not those issued directly by the International Accounting Standards Board, but are those that have been endorsed by the European Commission. EU has now endorsed IFRS, except for IFRS 6 and some of the IFRIC interpretations, and some changes in IAS 39 relating to the fair value of financial instruments (PwC, 2005a). While the EU regulation is only enforceable on listed companies, it also says that a member state has an option to extend the use of IFRS to unlisted companies within their jurisdiction. Department of Trade and Industry (DTI), the government trade body responsible for company regulation in UK, has said that while there is no mandatory move to IFRS for unlisted companies, the unlisted companies would still be allowed to adopt IFRS over UK GAAP from 2005 onwards. The basic aim of new financial reporting standards is same as that of existing standards – to provide information about financial performance and position of a company to different stakeholders. Internal stakeholders – management – normally have a good grip of what’s going in the business. It is external stakeholders like investors, auditors, suppliers and creditors who need to be informed in a succinct and clear manner about financial implications of business decisions. The IFRS would aim to present a more complete picture of a business by making operating income a more encompassing number. As an example, the financial implications of stock options were kept out of income statements. Companies merely mentioned the number of stock options granted. But now onwards, companies will have to incorporate the fair costs of granting stock options in their income statements. This will allow investors to assess the true costs of executive remuneration. Though the overall aim is same, the differences in implementation and financial reporting do occur due to social, economic and political backgrounds of different nations. Will it be a good policy to allow two different accounting standards in UK – one standard for listed companies and another for unlisted companies. UK’s Accounting Standard Board clearly sees there is no merit in having two separate standards. ASB issued a Discussion Paper in March 2004 highlighting its strategy for convergence with IAS and says that convergence of UK accounting standards to IAS is a foregone conclusion. It has already introduced many changes in recent past to bring UK’s GAAP in line with IFRS. Smaller companies, even listed ones, will find it difficult to cope with extra work due to IFRS. Alternative Investment Market (AIM) realises that most of its companies won’t be in a position to meet IFRS requirements soon. So it changed its regulatory status in October 2004 and is now an â€Å"exchange regulated market† and out of purview of European Commission regulation on regulated markets. Now companies listed on AIM have time until January 2007 to implement IFRS. Accounting Standards Board is also sensitive to the needs placed on business in making a transition from UK accounting standards to IFRS. Big businesses probably have sufficient resources to cope with the change in one year. But the smaller businesses will find it difficult to make all required changes in one year. ASB has proposed a series of changes that would be implemented in 2005 and 2006 which will bring UK financial reporting standards more in line with IFRS. Thereafter ASB will carry out a series of step changes by replacing one or more UK standards. So by the end of 2005-2006, UK standards will almost be in line with IFRS and unlisted companies transition to IFRS in 2007 would be smooth. This research analyses the attitude of unlisted companies towards IFRS. Many research and surveys have been carried out on the acceptance and readiness of listed companies for transition to IFRS. But the issue has not been explored in depth with respect to unlisted companies. The research is based on primary and secondary data. Primary data is collected via interviews and questionnaires with companies and their auditors. A total of [34] interviews – [20] with companies and [14] with their auditors – were conducted to obtain primary data. [52] questionnaire responses by postal survey were also analysed. The results show that there is definitely a much scope in improving International Financial Reporting Standards for unlisted companies. Respondents were concerned about the costs associated with transition to IFRS and also the additional burden that will come with regular enhanced reporting. That IFRS will help in globalisation of capital markets and probably cheaper costs of capital is not of much significance for unlisted companies registered in UK. This research would be useful for institutes and associations framing accounting standards for unlisted companies. Mostly accounting standards have been framed with an eye for listed and large companies. But unlisted companies have much lesser resources to spend on large regulatory requirements and hence should have different reporting requirements that match the benefits obtained from such reporting. The time limitation and resource constraint mean that the primary data via interviews and questionnaire surveys could only be collected through a limited number of respondents. It would be useful to cover a larger data base before implementing the changes. Also more users of data in unlisted companies like banks and creditors should be contacted before policy formulation. The remaining paper is divided in the following sections. Section II is a literature review on justification and applicability of IFRS, and state of readiness in companies. Section III discusses the methodology used in this research. Section IV covers analysis of data obtained through the primary data collection and its interpretation. The paper concludes with section V. SECTION II LITERATURE REVIEW In June 2000, the European Commission proposed a new directive requiring that all publicly traded companies in the member states to adopt International Accounting Standards Board (IASB) standards by no later than January 2005. On 19 July 2002, the European Parliament and the Council approved the IAS regulation (EC) 1606/2002 which said ‘For each financial year starting on or after 1 January 2005, companies governed by the law of a Member State shall prepare their consolidated accounts in conformity with the international accounting standards adopted †¦ if, at their balance sheet date, their securities are admitted to trading on a regulated market of any Member State’ (EU, 2002). Rationale for EU’s adoption of International Financial Reporting Standards The main aim of International Financial reporting Standards is to bring convergence among different national financial reporting standards. Over time, the evolution of different national financial reporting standards has been influenced by local social, political and economic environments. Some of the major reasons for differences in accounting standards are: Political – Capitalist or Communist. Capitalist and communist countries have almost contrasting fundamental economic approach and their accounting standards reflect the same. Stage of economic development. Developed countries generally have better accounting standards in terms of transparency and clarity. Corporate finance – debt or equity. Companies in continental Europe are financed more by debt than the companies in UK. Accounting standards have over time evolved to reflect the importance placed by different sources of financing on different aspects of financial statements. Legal and taxation systems. Convergence will help investors and analysts to compare companies across borders in a better way. But it also implies that either member countries will lose their independence to make national accounting standards that reflect local economic conditions or if they start introducing some changes, IFRS may slowly lose its main strength of common standard. Local, political and economical conditions may force national accounting bodies to introduce variations in IFRS. EU has already introduced some changes in the IAS 39 dealing with financial instruments. It is beyond the scope of this research to see which member countries have introduced variations in IFRS. Convergence between UK GAAP and IFRS ASB has declared its intention to converge UK GAAP with IFRS. It has issued a number of new standards in December 2004 to speed up the convergence of UK GAAP with IFRS. So sooner, even unlisted companies would be following a substantial portion of IFRS due to this convergence. Comparison of UK GAAP and IFRS Similarities The ultimate goal of UK GAAP and IFRS is same – to present information about financial performance and position to all concerned stakeholders. If the aim is same, then should be the main approach adopted by both accounting standards. The UK’s Accounting Standard Board’s Statement of Principles for Financial Reporting is a vital contributor at macro level standard setting. It plays almost same role as International Accounting Standards Committee’s ‘Framework for the Preparation and Presentation of Financial Statements’. ‘It is a description of the fundamental approach that the Accounting Standards Board (ASB) believes should, in principle, underpin the financial statements of profit-oriented entities’ (ASB, 1999). The Statement of Principles has true and fair concept at its core, much like the focal point in International Accounting Standards. Also like IAS, Statement of Principles insists on financial information being relevant and comparable. It is beyond the scope of this research to highlight each and every similarity between UK GAAP and IAS. Differences Though the overall aim is same, the differences in implementation and financial reporting do occur due to social, economic and political backgrounds of different nations. Main concepts behind UK GAAP and IFRS are same, but when we look at micro level, we see many differences at the individual standards level. Following are the main differences between UK GAAP and IFRS: The Statement of Principles allows use of both historical cost and current value approaches in measuring balance sheet categories. The dual use of historical and current value methods is known as modified historical cost basis (ASB, 1999). Under historical cost, the carrying values of assets and liabilities are stated at the lower of cost and recoverable amount. This approach is more conservative as compared to IAS approach which uses fair value method. Also the choice of historical or current value method is based on subjective analysis of a company’s management and hence it is open to some manipulation. Fair value. If we look at global level, both UK GAAP and IFRS have adopted fair value method as the foundation of their accounting standards. IFRS takes fair value adoption even higher when it says that income statement will include the changes in the fair value of items that have not been yet traded like derivatives. The emphasis in new accounting standards is on mark-to-market fair value of assets and liabilities rather than on actual market price based fair values. Now both realised and unrealised changes in fair values would be incorporated in income statements. The first year of transition will see high volatility in earnings and balance sheet statements. Though this brings higher volatility, it will also test the management skills in proper presentation and explanation of changes. It may also change the benchmarks of success for managements. Acquisitions. Acquisition accounting will change under new accounting standards. Under UK GAAP, companies can choose between purchase and merger accounting. Under IFRS, companies will have to account under purchase method only. Goodwill. UK GAAP allowed amortisation of goodwill and companies had the option of not segregating intangible assets from goodwill. Under IFRS, intangible assets have to be separated from goodwill. Goodwill can not be amortised now but companies will have to undertake annual impairment tests to justify the value of goodwill on the balance sheets. BAT’s profits for year 2004 increased by  £454m because it no longer had to amortise goodwill of that amount (AccountancyAge, 2005b). Consolidation of accounts. Under new accounting rules, companies may have to consolidate certain additional subsidiaries into group accounts. On the other hand companies will have to exclude certain subsidiaries or special purpose vehicles which were not included till now. Research and development costs. Under IAS 39, research costs can’t be carried on the balance sheet and would have to write them off as incurred. Companies would still be allowed to capitalise development in line with UK GAAP. Stock options. Internet and share market last boom in late 1990s led to rapid increase in share options as a way to reward employees. The new requirements to record an expense on income statement for the value of share options granted to employees could have a significant impact on earnings. AstraZeneca said in its pro forma 2004 IFRS numbers that new accounting rules on stock options has made it re-consider the use of stock options in rewarding its employees (Tricks, 2005). Distributable profits. Organisations ability to pay dividends is dependent on their distributable profits. Following are some of the major impacts of IFRS on distributable profits Inability to discount deferred tax liabilities, higher provisions for deferred tax when companies move from historical costs to fair value and inclusion of pension deficits in income statement. All of the above will reduce distributable profits. Many companies would have to financially restructure themselves in order to have sufficient distributable profits to meet dividends paid in last year. Deferred tax credit. Deferred tax credit is available under UK GAAP but not under IFRS. GlaxoSmithKline’s restated its 2004 earning per share by (1.9p) due to non-availability of deferred tax credit under IFRS (AccountancyAge, 2005a). Inclusion of business disposals gains in profits from operations. BAT’s profits for year 2004 increased by  £1.3bn after it included gains from disposals to operating profits (AccountancyAge, 2005b). Adding disposal gains to operating profits will make it harder for investors and analysts to separate the earnings from continuing businesses. Derivative contracts. Under IFRS, some derivative contracts will not qualify as hedges as they wont meet the criteria. UK GAAP allowed deferment of such contracts until transaction took place. IFRS won’t allow the deferment of such contract and would impact the profit and loss account even before the transaction took place. It is better in a way that investors will know the current value of the firm as on date rather than historical costs of such instruments, especially if the duration of financial instruments was long. At the same time, it would increase the burden on the company to calculate the fair value of all such transactions. Agricultural. UK GAAP allowed companies to use a cost model for biological assets and all agricultural produce. But under IAS companies would have to use mark to market method for valuing such assets. Now companies would have to use market valuation even for assets in far off countries. Advantages of IFRS over UK GAAP Common financial language. Adopting common financial reporting standards will open up a company to more markets and investors. The growth in telecommunications has made it easier for smaller investors to invest across physical boundaries. Such investors are normally not as financially sophisticated as some big financial institutions. They would also not like to understand more than one accounting standards as they don’t have required resources in hand to do so. With one common accounting standard, more investors would like to explore companies across nations. Acquisitions. IFRS 3 is more open and transparent than UK GAAP on acquisitions. It will allow investors and analysts to judge faster the success of an acquisition. Many of the companies that have relied on acquisition as a key cornerstone for growth would now come under intense scrutiny and may have to develop a new strategy for growing business.    Consolidation. In IFRS, all entities will have to provide a cash flow statement. Additionally there would be more transparency within the group companies and this should make the consolidation process more straight-forward. Securitisation by businesses is likely to be impacted by the new ways governing how companies can show assets and liabilities on their financial statements. Companies have used securitisation to cash in assets like trade receivables sitting on their balance sheets. Securitisation helps companies to slim down their balance sheets and hence allows companies to show higher return on assets at same earnings. And it was one of the reasons why companies went for securitisation. But stringent criteria for moving assets and liabilities off balance sheet will threaten securitisation. Sue Harding, chief accountant at Standard Poor’s in Europe said that new international accounting standards were sweeping a lot of securitised assets back on to balance sheets (Jopson, Feb 2005). This will help investors compare like to like and avoid companies that have used securitisation only to make-up their balance sheets. There is no harm in using securitisation if used in a proper way and not to deceive stakeholders. But we have seen how corporations like Enron had used securitisation to disguise their true financial position. Annual impairment review. Annual impairment review will benefit investors because the companies then won’t like to take big goodwill cuts in one year and not do anything for years. Annual reviews would help investors judging whether the amount paid by companies in acquiring other company was justified or not. Access to cheaper capital. Increase in investor profile diversification would most probably lower the cost of capital for most of the companies. This is especially true for smaller companies which don’t have financial muscles and resources to tap international investors. Expensing research costs gives better information to investors and other stakeholders because at research stage the chances of success are quite uncertain. Investors can only be sure of development costs bringing in some returns in future. Also by segregating research and development costs, external stakeholders will now have a better chance to differentiate the suitability of costs incurred in developing new products. Multiple listings. Many companies now have multiple listings across different countries. Companies need to prepare financial statements as per each local accounting standard to meet listing requirements. With one accounting standard only it will save a lot of botheration for companies with multiple listings. Dividends. Under IFRS dividends are not provided for until the dividend recommended by the Board is approved by shareholders. This move will bring more convergence between accounting profits and cash flows. Disadvantages of IFRS Fair value. While fair value in a way conveys more up to date value of a company as compared to historic costs, it also puts a question mark on the methods used and the reliability of fair value. Derivative instruments which are commonly traded on various stock exchanges can be easily assigned value. So while valuing some of the assets or liabilities may not be difficult, the question still remains what impact such valuations will have on companies’ business models. Many companies use hedging instruments as a strategic tool rather than for intentional gains. Any short-term swings in such instruments may have a significant impact on income statement and probably adverse market reactions may deter companies’ from using such instruments. Then comes the more important issue of valuing assets and liabilities that don’t have a proper market. The companies may use some valuation model, which itself may not be the right way, to value an asset or liability. The model will incorporate some subjective assumptions. An example would be brand value. A same brand can have two different values for two different companies because of its strategic importance. So at one hand, investors and other external stakeholders are getting more objective information about a companies’ assets and liabilities, they are also getting valuation based on more subjective assessments. Only time will tell whether some individuals or companies will use it to manipulate results. An interesting thing to observe would be the treatment and importance given by analysts to unrealised fair value of assets and liabilities. Some investors may try to separate unrealised gains and losses from other operational performance. It may also prompt companies to issue adjusted earnings excluding unrealised gains and losses. An important point to note about fair value principle is that the financial statements should not be seen as perfect prediction of things to come. That depends on the strategic and business decisions management will take in future. Just having a fair value of assets and liabilities doesn’t mean that the company will be able to extract those values in future.    Dividend. New accounting standards promote payment of dividend from distributable reserves. With the inclusion of unrealised gains and losses and pension deficits, the first few years of new accounting standards may not leave enough of distributable reserves for dividend payments. Securitisation. Securitising assets into special purpose vehicles and re-financing them through had also helped companies raise funds at lower costs. The new accounting standards by restricting the use of special purpose vehicles, would diminish some sources of cheap financing. It is question yet to be fully tested in the practical world that since the assets are same, change in financing options shouldn’t change the returns on total assets. By refinancing at lower rates through securitisation should result in higher financing cost for remaining assets such that the overall costs remain same. But examination of this hypothesis is beyond the scope of this dissertation. But what is mostly observed in capital markets is that when companies announce refinancing, the share price rises. How much of the rise is from relief that company will survive and how much from the fact that the overall costs have lowered is not known. Annual impairment tests. Annual impairment tests are easier said than done. Companies would not only have to devote substantial resources to do that first would have to train its personnel to do that. Assessing true value of a goodwill is not easy. If there is a comparable market then companies can easily value it. Even then it may differ from case to case as it would be very unusual to see exactly two similar companies. Goodwill is very different from tangible assets or technologies and depends a lot on market perception and strategy. Companies would have to review the whole process of valuing goodwill and would have to review the valuation process at constant intervals. Net pension liability. The inclusion of net pension liability on the balance sheet may have severe impact on the shareholders funds. Companies will be required to have annual actuarial valuation of their pension liabilities and the same would be reflected in financial statements. Most of the pension funds invest in equity markets, which have been quite volatile in the recent years. So though over a longer period, the movements in pension liabilities may even out but in short to medium term, it may have a dramatic effect on balance sheets and earning statements. Segmental information. IAS 14 requires companies to report information on their business segments and on a scale more detail than UK GAAP. As of date, no agreed accounting practices have emerged on how much should be disclosed because companies may end up revealing sensitive information to its competitors. If companies disclose the turnover, earnings and expenditure for each segment, its profitable operations may come under intense competition. Ian Dilks of PwC said that â€Å"some companies have found they’re giving much more information than they’re comfortable with on sales and the profitability of product areas† (Tricks, 2005) Expensing research costs may result in listed companies focusing more on products in development stage than in research stage. This will keep their balance sheets healthy but may harm long term prospects. Complex and long IFRS compliant reports. PricewaterhouseCoopers estimates that an IFRS compliant financial report for insurance companies could be up to twice as long as those prepared under existing UK GAAP (Finn Zoon, 2004). The requirement for other industry sectors though may not be as intensive as for insurance sector, their IFRS compliant financial may also be longer and resource intensive than under UK GAAP. Any company that has makes an acquisition will have to do annual goodwill impairment analysis and most of them would like to explain the results also. Comparable formats. IAS 1 is less prescriptive than the UK GAAP when it comes to the format of the balance sheet and income statement. It just distinguishes current and non-current assets and liabilities. Investors, when faced with different formats, may find it difficult to compare companies. Modify organisation structures. Meall (2003) suggested that the additional burden of more financial reporting along different segments may force companies to modify their existing organisational structures within their financial systems to collect and analyse data. Impact of IFRS on different industries IFRS will have different impact on different industries. For some, most of the applied UK GAAP is almost same as IFRS and won’t feel the difference. But for some industries, the difference in accounting standards may have a substantial impact. Financial services and insurance companies are among them. Financial services companies would be affected by substantial change in recognition and measurement of financial instruments under IAS 39. UK GAAP has no equivalent to IAS 4 which deals with insurance contracts. Insurance companies would now have to account for this in their financial statements. Under IFRS, insurance companies would have to book financial instruments such as derivatives at market value rather than historical value allowed under UK GAAP. Many insurers have said that this will distort their earnings (Reuters, 2005a). IFRS will put more stringent criteria for classification of insurance products and this may lead to reclassification of some insurance products as investment products. Other industries that might face higher impact are the ones that heavily use hedging instruments in their day to day operations. Mostly companies using commodity materials like oil as a significant part of their input costs use hedging to smooth over the volatile changes in commodity markets. New accounting standards will reduce Tesco’s projected annual profit of  £2,000m by  £30m only, a reduction of 1.5%. But for some companies the impact would be much more. Royal Sun Alliance said that new accounting rules would reduce its net assets by  £400m (Reuters, 2005a). This is a big number by any standards and shareholders