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Introduction

Unlike most other modern professions, accounting has a history that is usually discussed in terms of one seminal event – the invention and dissemination of the double entry bookkeeping processes. But a view of accounting history that begins with Luca Pacioli’s contributions overlooks a long evolution of accounting systems in ancient and medieval times.

More fundamental is the question, why should we care about the history of accounting at all? Certainly a glimpse back into this period helps illuminate our past generally, and it is the sort of winding, twisted path that makes for an entertaining story. But perhaps the most compelling reason is to help explain the phenomenal growth that the profession of accountancy has enjoyed worldwide since the first royal charters were granted to the Society of Accountants in Edinburgh less than 150 years ago.

In 1904, 50 years after the emergence of the formal profession, about 6,000 practitioners carried the title of chartered accountant. In 1957, there were 38,690 chartered and incorporated accountants (Scottish, British and Irish). Today, the Institute of Chartered Accountants in England and Wales alone has a membership of over 120,000 worldwide.

This is to say nothing of the many professionals in the other allied institutes in Canada, New Zealand, Ireland, Australia, Scotland and South Africa, along with American certified public accountants -comprising a vast, worldwide network of professional accountancy dominated by several, mammoth, worldwide accounting firms.

How and why did this relatively new profession develop? Its history is that of human commerce, and even more fundamentally, of writing and the use of numbers and counting.

Some argue that accounting developed purely in response to the needs of the time brought about by changes in the environment and societal demands. Others claim that the development of the science of accounting has itself driven the evolution of commerce since it was only through the use of more precise accounting methods that modern business was able to grow, flourish and respond to the needs of its owners and the public. Either way, the history of accounting throws a light on economic and business history generally, and may help us better predict what is on the horizon as the pace of global business evolution escalates.

Ancient Accounting: Dawn of Man through Luca Pacioli

In attempting to explain why double entry bookkeeping developed in 14th century Italy instead of ancient Greece or Rome, accounting scholar A. C. Littleton describes seven “key ingredients” which led to its creation: Private property: The power to change ownership, because bookkeeping is concerned with recording the facts about property and property rights. Capital: Wealth productively employed, because otherwise commerce would be trivial and credit would not exist. Commerce: The interchange of goods on a widespread level, because purely local trading in small volume would not create the sort of press of business needed to spur the creation of an organized system to replace the existing hodgepodge of record-keeping.

Credit: The present use of future goods, because there would have been little impetus to record transactions completed on the spot. Writing: A mechanism for making a permanent record in a common language, given the limits of human memory. Money: The “common denominator” for exchanges, since there is no need for bookkeeping except as it reduces transactions to a set of monetary values. Arithmetic: A means of computing the monetary details of the deal.

Many of these factors did exist in ancient times, but, until the Middle Ages, they were not found together in a form and strength necessary to push man to the innovation of double entry. Writing, for example, is as old as civilization itself, but arithmetic – the systematic manipulation of number symbols – was really not a tool possessed by the ancients. Rather, the persistent use of Roman numerals for financial transactions long after the introduction of Arabic numeration appears to have hindered the earlier creation of double-entry systems.

Nevertheless, the problems encountered by the ancients with record keeping, control and verification of financial transactions were not entirely different from our current ones. Governments, in particular, had strong incentives to keep careful records of receipts and disbursements – particularly concerning taxes. And in any society where individuals accumulated wealth, there was a desire by the rich to perform audits on the honesty and skill of slaves and employees entrusted with asset management.

But the lack of the above-listed antecedents to double entry bookkeeping made the job of an ancient accountant extraordinarily difficult. In societies where nearly all were illiterate, writing materials costly, numeration difficult and money systems inconsistent, a transaction had to be extremely important to justify keeping an accounting record.

Accounting In Mesopotamia, circa 3500 B.C.

Five thousand years before the appearance of double entry, the Assyrian, Chaldean-Babylonian and Sumerian civilizations were flourishing in the Mesopotamian Valley, producing some of the oldest known records of commerce. In this area between the Tigris and Euphrates Rivers, now mostly within the borders of Iraq, periodic flooding made the valley an especially rich area for agriculture.

As farmers prospered, service businesses and small industries developed in the communities in and around the Mesopotamian Valley. The cities of Babylon and Nineveh became the centers for regional commerce, and Babylonian became the language of business and politics throughout the Near East. There was more than one banking firm in Mesopotamia, employing standard measures of gold and silver, and extending credit in some transactions.

During this era (which lasted until 500 B.C.), Sumeria was a theocracy whose rulers held most land and animals in trust for their gods, giving impetus to their record-keeping efforts. Moreover, the legal codes that evolved penalized the failure to memorialize transactions. The renowned Code of Hammurabi, handed down during the first dynasty of Babylonia (2285 – 2242 B.C.), for example, required that an agent selling goods for a merchant give the merchant a price quotation under seal or face invalidation of a questioned agreement. Thus it is believed that most transactions were recorded and subscribed by the parties during this period.

The Mesopotamian equivalent of today’s accountant was the scribe. His duties were similar, but even more extensive. In addition to writing up the transaction, he ensured that the agreements complied with the detailed code requirements for commercial transactions. Temples, palaces and private firms employed hundreds of scribes, and it was considered a prestigious profession.

In a typical transaction of the time, the parties might seek out the scribe at the gates to the city. They would describe their agreement to the scribe, who would take from his supply a small quantity of specially prepared clay on which to record the transaction. Clay was plentiful in this area, while papyrus was scarce and expensive.

The moist clay was molded into a size and shape adequate to contain the terms of the agreement. Using a wooden rod with a triangular end, the scribe recorded the names of the contracting parties, the goods and money exchanged and any other promises made. The parties then “signed” their names to the tablet by impressing their respective seals.

In an age of mass illiteracy, men carried their signatures around their necks in the form of stone amulets engraved with the wearer’s mark, and were buried with them at death. Often the seals included the owner’s name and religious symbols, such as the picture and name of the gods worshipped by the owner.

After these impressions from the amulets were made, the scribe would dry the tablet in the sun or in a kiln for important transactions which needed a more permanent record. Sometimes a clay layer about as thick as a pie crust was fashioned and wrapped around the tablet like an envelope. For extra security, the whole transaction would be rewritten on this outer “crust,” in effect making a carbon copy of the original.

Attempted alterations of the envelope could be detected by comparing it with its contents, and the original could not be altered without cracking off and destroying the outer shell.

Accounting In Ancient Egypt, China, Greece and Rome

Governmental accounting in ancient Egypt developed in a fashion similar to the Mesopotamians. The use of papyrus rather than clay tablets allowed more detailed records to be made more easily. And extensive records were kept, particularly for the network of royal storehouses within which the “in kind” tax payments were kept.

Egyptian bookkeepers associated with each storehouse kept meticulous records, which were checked by an elaborate internal verification system. These early accountants had good reason to be honest and accurate, because irregularities disclosed by royal audits were punishable by fine, mutilation or death.

Although such records were important, ancient Egyptian accounting never progressed beyond simple list-making in its thousands of years of existence. Perhaps more than any other factors, illiteracy and the lack of coined money appear to have stymied its development.

While the Egyptians tracked movements of commodities, they treated gold and silver not as units of fungible value, but rather as mere articles of exchange. The inability to describe all goods in terms of a single valuation measure made cumulation and summation difficult and the development of a cohesive accounting system all but impossible.

Pre-Christian China used accounting chiefly as a means of evaluating the efficiency of governmental programs and the civil servants who administered them. A level of sophistication was achieved during the Chao Dynasty (1122 – 256 B.C.), which was not surpassed in China until after the introduction of double entry processes in the 19 century.

In the 5th century B.C., Greece used “public accountants” to allow its citizenry to maintain real authority and control over their government’s finances. Members of the Athens Popular Assembly legislated on financial matters and controlled receipt and expenditure of public monies through the oversight of 10 state accountants, chosen by lot.

Perhaps the most important Greek contribution to accountancy was its introduction of coined money about 600 B.C… Widespread use of coinage took time, as did its impact on the evolution of accounting. Banking in ancient Greece appears to have been more developed than in prior societies. Bankers kept account books, changed and loaned money, and even arranged for cash transfers for citizens through affiliate banks in distant cities.

Government and banking accounts in ancient Rome evolved from records traditionally kept by the heads of families, wherein daily entry of household receipts and payments were kept in an adversaria or daybook, and monthly postings were made to a cashbook known as a codex accepti et expensi. These household expenses were important in Rome because citizens were required to submit regular statements of assets and liabilities, used as a basis for taxation and even determination of civil rights.

An elaborate system of checks and balances was maintained in Rome for governmental receipts and disbursements by the quaestors, who managed the treasury, paid the army and supervised governmental books. Public accounts were regularly examined by an audit staff, and quaestors were required to account to their successors and the Roman senate upon leaving office.

The transition from republic to empire was, at least in part, to control Roman fiscal operations and to raise more revenues for the ongoing wars of conquest. While the facade of republicanism was maintained, the empire concentrated real fiscal and political power in the emperor. Julius Caesar personally supervised the Roman treasury, and Augustus completely overhauled treasury operations during his reign.

Among Roman accounting innovations was the use of an annual budget, which attempted to coordinate the Empire’s diverse financial enterprises, limited expenditures to the amount of estimated revenues and levied taxes in a manner which took into consideration its citizens’ ability to pay.

Medieval Accounting

Thousands of years between the fall of the Roman Empire and the publication of Luca Pacioli’s Summa, are widely viewed as a period of accounting stagnation and medieval practices outside Italy are often ignored in historical summaries. Yet, as historian Michael Chatfield has observed, medieval agency accounting, “laid the foundations for the doctrines of stewardship and conservatism, and the medieval era created the conditions for the rapid advance in accounting technology that occurred during the Renaissance.”

While accounting under the Roman Empire was prescribed by the centralized legal codes of the time, medieval bookkeeping was localized and centered on the specialized institutions of the feudal manor. The systems of exchequer and manor necessitated numerous delegations of authority over property from the owners to actual possessors and users. The central task of accounting during this era was to allow the government or property owners to monitor those in the lower portions of the socio-economic “pyramid.”

Italian Renaissance: Birth of Double Entry Bookkeeping

The innovative Italians of the Renaissance (14th -16th century) are widely acknowledged to be the fathers of modern accounting. They elevated trade and commerce to new levels, and actively sought better methods of determining their profits.

Although Arabic numerals were introduced long before, it was during this period that the Italians became the first to use them regularly in tracking business accounts – an improvement over Roman numerals the importance of which cannot be overstated. They kept extensive business records, as the use of capital and credit on a large scale developed: The evolutionary trend toward double entry bookkeeping was underway.

Professional Accountancy Travels Across the Globe

George Watson (1645-1723), one of the early Scottish accountants, trained in Holland and passed along instructional materials used by his fellow professionals. By the middle of the19th century, England was in the midst of prosperous times brought on by the Industrial Revolution.

It was the leading producer of coal, iron and cotton textiles, and was the financial center of the world. With this financial surge came a demand for accountants, both for the healthy concerns and those companies declaring bankruptcy in the midst of the competition.

In 1880, the newly formed Institute of Chartered Accountants in England and Wales brought together all the accountancy organizations in those countries. In addition to the 587 members initially enrolled, an additional 606 members were soon admitted on the basis of their experience. Standards of conduct and examinations for admission to the Institute were drawn up, and members began using the professional designations “FCA” (Fellow Chartered Accountant, for a firm partner or proprietor in practice) and “ACA” (Associate Chartered Accountant, signifying a qualified member of an accountant’s staff, or a member not in practice).

In the late 1800s, large amounts of British capital were flowing to the rapidly growing industries in the United States. Scottish and British accountants traveled to the U.S. to audit these investments, and a number of them stayed on and set up practice in America. Several existing American accounting firms trace their origins to one or more of these visiting Scottish or British chartered accountants.

City directories from the year 1850 list 14 accountants in public practice in New York, four in Philadelphia and one in Chicago. By 1886, there were 115 listed in New York, 87 in Philadelphia and 31 in Chicago. Groups of accountants joined together to form professional societies in cities across America. In 1887, the first national accounting society was formed – the American Association of Public Accountants, predecessor to the American Institute of Certified Public Accountants.

Into The Twentieth Century and Beyond

However prosperous, the United States was still an infant nation when the American Institute of Certified Public Accountants was formed. The Civil War ended with the U.S. still a predominantly farming-based economy. It was only the year before that the Apache chief Geronimo had surrendered to the federal authorities. The ensuing decades saw enormous economic growth as industry began to overtake agriculture in financial importance.

This period of growth also saw its share of financial scandals. Over-capitalization and stock speculation caused financial panics in 1873 and 1893. Watered railroad stocks were in the headlines, along with concerns about growing monopolies in several industries. Labor unions developed in response to corporate exploitation of workers. Congress responded by passing the first Interstate Commerce Act and the Sherman Antitrust Act, marking the beginnings of federal regulation of business. When Theodore Roosevelt became President after the 1901 assassination of William McKinley, he supported the use of governmental power to control the growing industrial monopolies and the price increases they caused.

The Roosevelt administration helped persuade Congress to establish the Department of Commerce and Labor to gather the facts needed to enforce antitrust laws. The Interstate Commerce Commission’s powers over transportation were broadened, and the ICC established a uniform system of accounting – the first instance of accounting used as an instrument of federal regulation.

Unlike the British, who used the balance sheet in an effort to monitor management’s use of stockholders’ monies, American corporations of the early 20th century had no comparable history of losses from stock speculation. Rather, American balance sheets were drafted mainly with bankers in mind, and bankers of the era cared more about a company’s liquidity than earning power.

Beginning in 1920, business practices began changing drastically as the U.S. went through an inventory depression in which wholesale prices fell 40 percent. Cash flow slowed, loans defaulted and credit became less available to corporations. In response, businesses sought financing from sources less tied to their current cash flow. The offering of corporate stock issues became a leading method of financing expansion.

As stockholders, rather than bankers, became the primary audience of financial statements, the income statement began to take center stage over the balance sheet. Other factors, such as the rise of income taxation and cost accounting, also shifted the focus to revenues and expenses.

At the turn of the century, there were at least four types of funds statements in use – those that summarized changes in cash, in current assets, in working capital and overall financial activities. Accountant H. A. Finney led the movement for use of a funds statement that focused on liquidity by tracking the sources of changes in working capital. He used a worksheet approach to highlight meaningful balance sheet changes by aggregating most of the fluctuations that affect working capital, and offered a standardized method for calculating them.

In the 1940s, the accounting profession increasingly used the funds statement to measure the actual flow of monies, rather than simply the sum of working capital changes between balance sheet dates. The funds statement increasingly became a staple for the financial statement and, in 1971, the American Institute of Certified Public Accountants began requiring its inclusion in stockholders’ annual reports. 

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Nowadays, with more than 330,000 members, the AICPA is the premier national professional association for CPAs in the United States. Their web site is full of useful resources, including the latest American accounting news, along with organization-specific materials.

References

Brown, Richard, ed. A History of Accounting and Accountants. Edinburgh: Jack, 1905.

Calhoun, George M. The Business Life of Ancient Athens. Chicago: University of Chicago Press, 1926.

Chiera, Edward. They Wrote on Clay. Chicago: University of Chicago Press, 1938.

Geijsbeek, John Bart. Ancient Double-Entry Bookkeeping: Lucas Pacioli’s Treatise. Denver: University of Colorado, 1914.

Keister, Orville R. “Commercial Record-Keeping in Ancient Mesopotamia.” Accounting Review 38 (April, 1963), 371-76.

Littleton, A. C. Accounting Evolution to 1900. New York: American Institute Publishing Co., 1933.

Peragallo, Edward. Origin and Evolution of Double Entry Bookkeeping, A Study of Italian Practice from the Fourteenth Century. New York: American Institute Publishing Co., 1938.

Weber, Charles. The Evolution of Direct Costing. Urbana: Center for International Education and Research in Accounting, 1966.

History and Development of Accounting Standards

Accounting has been around since the beginning of civilization. ¡§Accountants participated in the development of cities, trade, and the concepts of wealth and numbers.¡¨ (Giroux) The importance of accounting cannot be overemphasized. Equally important are the standards used to guild the application of accounting practice. Without principles and standards, financial reporting would not fairly present the financial position of a company. Accounting has changed and evolved vastly over time and continues to change. I will discuss the evolution and history of accounting, the Conceptual frame work of accounting, and the governing bodies which shape the standards and principles of accounting practice.

The beginning of civilization occurred during the transition from hunter-gatherer to farmer. Farming led to crop surplus and therefore the need to trade and barter. Jericho, the oldest city known to historians was the first known trading center for surplus goods. Personal wealth created the need to keep track of inventories. Ancient bookkeepers used small clay balls called tokens to count and keep track of existing wealth. These tokens were used as evidence of transactions. Over time, the tokens were used to make impressions in clay along with pictures which represented the first attempts at accounting.

These events took place around 5000 B.C. (Giroux) Evidence suggests that double entry bookkeeping developed in Italy around 1200 B.C. The first book written on double entry bookkeeping was written by Luca Pacioli in 1494. (Smith) Pacioli was referred to as the father of accounting, but he did not actually invent the system he described. He simply wrote about the business practices used by merchants in Venice at the time. Many of his writings were used for several centuries. With the development of technology, wealth, and trade came the need to adequately account for the complexity involved. Scribes became accountants and in the process invented numbers and writing.

Accounting played a central role in the development of civilizations. Accountants invented writing, participated in the development of money and banking, invented double entry bookkeeping, and helped develop the confidence in capital markets. The industrial revolution started around 1750. As industry, mass transportation and capital markets were established, the role of accountants expanded. By the mid to late 19th century there was a strong need for professional accountants. The earliest of the big four accounting firms was started by William Deloitte in 1845.

Today the firm still bears his name, Deloitte and Touche. Samuel Price and Edwin Waterhouse formed their partnership in 1849. William Cooper started his firm in 1854. By this time, the profession of accountants was firmly established. The United States took its lead from entrepreneurs in Europe. During the late 1800¡¦s cost accounting was developed to increase efficiencies in the factories. The expansion and development of big business, such as Standard Oil and U.S. Steel, created the need for more sophisticated accounting systems to keep track of expanding divisions within these large corporations.

Around the turn of the century the United States overtook Britain as the leading industrial power in the world. This rapid growth created the need for greater regulation. Insiders benefited from price fixing, stock manipulation, and various schemes of questionable legality. Financial statements were audited, but the auditors usually worked for the company and did not have motivation to protect the interests of third party investors. World War I ended in 1919. (Library of Congress) After the War there was a surge of securities activity. ¡§During the 1920s, approximately 20 million large and small shareholders took advantage of post-war prosperity and set out to make their fortunes in the stock market. It is estimated that of the $50 billion in new securities offered during this period, half became worthless.¡¨ (SEC)

Before the stock market crash in 1929, there was little support for reform of financial reporting. Black Friday changed all that. People and banks lost huge fortunes, and the public lost faith in the capital markets. There was a consensus that for the economy to recover, the public’s faith in the capital markets needed to be restored. Congress held hearings to identify the problems and search for solutions. Based on the findings in these hearings, Congress passed the Securities Act of 1933 and the Securities Exchange Act of 1934. Congress established the Securities and Exchange Commission in 1934 to enforce the newly-passed securities laws, to promote stability in the markets and, most importantly, to protect investors.

The SEC was given the mandate to establish accounting principles. Although the SEC was given the authority to govern accounting practice, they believed the private sector had the resources and talent to develop appropriate accounting standards. (Kieso, 6-7) The American Institute of Certified Public Accountants and its predecessors have a history dating back to 1887, when the American Association of Public Accountants was formed. In 1916, the American Association was succeeded by the Institute of Public Accountants, at which time there was a membership of 1,150. The name was changed to the American Institute of Accountants in 1917 and remained so until 1957, when the name was again changed to the American Institute of Certified Public Accountants.

The American Society of Certified Public Accountants was formed in 1921 and acted as a federation of state societies. The Society was merged into the Institute in 1936. (AICPA) At the urging of the SEC, the AICPA appointed the Committee on Accounting Procedure in 1939. Between 1939 and 1959, The CAP issued 51 accounting research bulletins. These bulletins dealt with problems as they arose and failed to address accounting principles. Because accounting principles were not addressed, the AICPA created a new standard setting body. In 1959, the Accounting Principles board was created to determine appropriate practices, establish accounting principles, and to reduce the inconsistencies in practice.

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The APB released APB opinions, which were based on research studies. The mission of the APB was to develop an overall conceptual framework. It issued 31 opinions and was dissolved in 1973 for lack of productivity and failure to act promptly. In 1971, many feared that the government would step in to regulate the profession. Because of that fear, a study group on accounting principles was formed. This group was referred to as the Wheat Committee. The Wheat Committee was named after its chair, Francis Wheat. The committee was instructed to examine the organization and operation of the APB. They were looking for a way to get better results. In 1972, the Wheat Committee submitted their findings to the AICPA.

This group determined that the APB must be dissolved and a new standard-setting structure be created. This structure is composed of three organizations: the Financial Accounting Foundation (it selects members of the FASB and funds and oversees their activities), Financial Accounting Standards Advisory Council (FASAC), and the major operating organization in this structure, the Financial Accounting Standards Board (FASB). FASB has 4 major types of publications. Statements of Financial Accounting Standards are the most authoritative GAAP setting publications. There are more than 150 issued to date. Statements of Financial Accounting Concepts, first issued in 1978 are a part of FASB conceptual framework project. Read about

These seven concepts are not a part of GAAP. Interpretations modify or extend existing standards. There are about 50 interpretations published to date. Technical Bulletins are the forth type of publication and are guidelines on applying standards, interpretations, and opinions. Interpretations usually solve some very specific accounting issue that will not have a big, lasting affect. Generally accepted accounting principles (GAAP) are a collection of rules, procedures and conventions that define accepted accounting practice. GAAP is not written in law, although the SEC requires that it be followed in financial reporting by publicly traded companies.

Every day, accountants make judgments about how to record business transactions. GAAP are guidelines or, more precisely, a group of objectives and conventions that have evolved over time to govern how financial statements are prepared and presented. The Financial Accounting Standards Board, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission provide guidance about acceptable accounting practices. GAAP has four basic assumptions, four basic principles, and four basic constraints. These are the Statements of Financial Accounting Concepts.

The first of the four basic assumptions is the economic entity assumption, which assumes that the business is a separate entity because the revenues and expenses are kept away from personal items. This applies even for partnerships and sole proprietorships. The going concern assumption assumes that the business will be in operation for a long time. This validates the methods of asset capitalization, depreciation, and amortization. The monetary unit assumption assumes a stable currency is going to be used. The FASB accepts the US dollar as the monetary unit of record. The periodicity assumption assumes that the business operations can be recorded and separated into different periods.

This is required for comparison between present and past performance. FASB also created for basic principles for public accounting to follow. The first of which is the historical cost principle. This principle requires companies to account and report based on acquisition costs rather than fair market value for most assets and liabilities. The revenue recognition principle requires companies to record revenue when it is realized or realizable and earned, not when cash is received. This way of accounting is called accrual basis accounting. The third principle is the matching principle.

Expenses must be matched with revenues as long as it is reasonable to do so. The last principle is called the full disclosure principle. The full disclosure principle states that any and all information that affects the full understanding of a company’s financial statements must be include with the financial statements. Some items may not affect the ledger accounts directly. These would be included in the form of accompanying notes. Examples of such items are outstanding lawsuits, tax disputes, and company takeovers. The first of the four constraints is the cost-benefit relationship. The cost-benefit relationship states that the benefit of providing the financial information should also be weighted against the cost of providing it.

Materiality, the second constraint, states that significance of an item should be considered when it is reported. Materiality is based on weather or not the amount report will conceivably effect a third parties decision based on the information presented. The industry practice constraint states that accounting procedure should follow industry practices. This is important so that companies are easier to compare. Conservatism states that when choosing between two unfamiliar solutions, the conservative method should prevail. This is a simple concept that basically states that it is better to understate than to overstate financial information. In 1984 the FASB created the Emerging Issues Task Force, which deals with new and unusual financial transactions that have the potential for becoming common practice.

An example of an issue that would be addressed is accounting for Internet based companies. It acts more like a problem filter for the FASB and deals with short-term, quickly resolvable issues, leaving long-term, more pervasive problems for the FASB. During the 1990¡¦s there was a wide range of accounting scandals, which had not been seen in the past. It became evident that change was needed in the auditing profession. Auditors were being influenced by management at large corporations. SEC chairman Harvey L. Pitt made the following statement in a press statement on January 17, 2002: The past seven months have tested the mettle and resiliency of our country, our markets, and the investing public’s confidence.

With the events of September 11th, the bankruptcy of Enron and, just last week, the indictment of Arthur Andersen, we have witnessed how critical our appropriately vaunted capital markets are to the strength, security and spirit of our Country and our economy. All Americans have felt, and continue to feel, the consequences of these events. In response to the unexpected and rapid bankruptcies of large companies such as the Enron Corporation and WorldCom, Inc., concerns about the integrity and reliability of financial disclosures, and the adequacy of regulation and oversight of the accounting profession, the Sarbanes-Oxley Act of 2002 was enacted into law on July 30, 2002. (Sarbanes)

The law is named after sponsors Senator Paul Sarbanes (D-MD) and Representative Michael G. Oxley (R-OH). It was approved by the House by a vote of 423-3. The Senate voted unanimously in favor (99-0). (Wikipedia) The foundation for this reform was the creation of the Public Company Accounting Oversight Board to oversee the audits of public companies. The PCAOB was given broad authority to regulate the auditing profession. The PCAOB has the authority to impose civil penalties, and possible permanent revocation of a firm¡¦s ability to audit public companies.

The potential impact of disciplinary actions was noted by former SEC Chief Accountant Lynn Turner, who told Securities Law Daily (August 27, 2004) that ¡§the PCAOB has to use these inspections to drive changes in the rules and, quite frankly, get tough on enforcement.¡¨ Looking high and low for any ¡§hot tip,¡¨ the PCAOB has even established online and telephone systems for anonymous tips and complaints. (Farrell) Over time, the importance of the PCAOB will only increase.

In October 2004, William McDonough (PCAOB Chairman) stated that more issuer restatements should be expected as the result of the 2004 inspections. The PCAOB is expected to grow to over 300 full time employees and 7 regional offices across the country. (Farrell) The PCAOB will likely expand its role, its responsibility, and its dedication to fulfill its mission to provide accurate and complete information to the investing public.

The accounting profession has grown and changed vastly based on the financial needs of the time. Accounting started with very basic inventory methods using stone markings in clay, and has evolved into a very complex combination of rules and regulations. The future of the profession is sure to see many more changes as the needs of investors and management change. What becomes apparent is that the future of accounting is extraordinarily bright. After all, so long as there are transactions, there will be the need for accountants to analyze, assess and recommend alternatives.

A case can be made that the reason the US is an international leader is the fact that we have such a well-developed system of accounting. As such, global investors can look at financial statements with a confidence that encourages more investment. We can take pride in knowing that one of our most important exports has been our system of financial reporting. No third world country can aspire to economic success without embracing rigorous accounting standards simply because no investor is likely to risk capital on a venture which cannot be quantified.

That is perhaps the greatest single problem that even countries as large as Russia and China must resolve. Without accounting, free enterprise cannot exist. As globalization continues, the role of the accountant takes on increasing importance in creating economic opportunities for every occupant of the world.

Works Cited

?«American Institute of Certified Public Accountants, Summary of AICPA Operations, August 21, 2005, ; http://www.aicpa.org/dues/summary.htm; ?«Farrell, James J. and Shadab, Houman B., The Focus of Future PCAOB Auditor Inspections, June 2005, ?«Giroux, Gary, A Short History of Accounting ; Business, ?«Kieso, Donald E., Weygandt, Jerry J., Warfield, Terry D., Intermediate Accounting 11th ed., Hoboken, N.J., 2004 ?«Library of Congress, America¡¦s story from America¡¦s Library, ?«Sarbanes, Paul S., PCAOB Selection Process, December 19, 2002, General Accounting Office Report, ?«Securities and Exchange Commission,

?«Smith, Murphy L., Luca Pacioli: The Father of Accounting, March 26, 2002, ; http://acct.tamu.edu/smith/ethics/pacioli.htm; ?«Solomons, David, Making Accounting Policy, New York; Oxford University, 1986 ?«Wikipedia, Sarbanes-Oxley Act, September 1, 2005,

History development of accounting principles

Callahan-Babylonian, Assyrian and Sumerian civilizations the producers of the first organized government in the world, and some f the oldest written languages and the oldest surviving business records; the Egyptian civilization – where scribes formed the pivots on which the whole machinery of the treasury and other departments turned; the Chinese civilization – with government accounting playing a key and sophisticated role of the great estate of Apollonian Introduced an elaborate system of responsibility accounting In 256 BC; and the Roman civilization – with laws requiring taxpayers to prepare statements of their balancing positions and with civil rights depending on the level of property declared by the citizens. The presence of these forms of bookkeeping In the ancient world has been attributed to various factors, including the invention of writing, the introduction of Arabic numerals and of the decimal system, the diffusion of knowledge of algebra, the presence of inexpensive writing material, the rise of literacy, and the existence of a standard of medium of exchange. The Development of Accounting Principles Various groups in the united States of America (USA), Australia and elsewhere, implementing a mix of approaches, have subjected accounting theory and principles to a constant re-examination and critical analysis.

In order to simplify the discussion, four phases of this process may be identified. In the first phase (1900-33), management had complete control over the selection of financial Information disclosed in annual reports; in the second phase (1933-59) and third phase (1959-731 the professional bodies played a significant role in developing principles; and in the fourth phase, which continues to the present, it has become increasingly noticeable that standard-setting bodies such as the Financial Accounting Standards Board (FAST) in the USA and the Australian Accounting Standards Board in Australia (SAAB) ND various pressure groups are moving towards a plasticization of accounting.

Management Contribution Phase (1900-33) The influence of management in the formulation of accounting principles arose from the increasing number of shareholders and the dominant economic role played by industrial corporations after 1900. The diffusion of share ownership gave management complete control over the format and content of accounting of ad hoc solutions to urgent problems and controversies. The situation generated dissatisfaction during the asses. Two Americans, William Z. Ripley and J. M. B. Huxley, ere particularly outspoken in arguing for an improvement in standards of financial reporting. Similarly, Adolph A. Berne and Gardener C. Means pointed to corporate wealth and the power of industrial corporations and called for the protection of investors.

In the United States, the main players of the time were a professional association of accountants, the American Institute of Accountant (AI), which in 1917 established a Board of Examiners to create a uniform certified practicing accountant (CPA) examination, and the New York Stock Exchange (NYSE), which from 1900 required all reparations applying for listing to agree to publish annual financial statements. A theoretical and a controversial debate of the period was the question of accounting for interest costs. The Abs’s Discussion Memorandum on Accounting for Interest Costs traces the background of the interest as a cost controversy. Another important event of the era was the growing effect, on accounting theory, of taxation of business income.

Citibank: Launching the Credit Card in Asia Pacific Citigroup is an American multinational financial services company based in New York City. Citigroup was formed from one of the world’s largest mergers in history by combining the banking giant Citicorp and financial conglomerate Travelers Group. Nowadays is one of the world’s largest banks. In 2010 was in 22nd position worldwide, ranked on its total assets. Finally, it has the world’s largest financial services network, pning 140 countries with approximately 16,000 offices worldwide, 260,000 staff around the world, and holds over 200 million customer accounts. In 1989, Citigroup tried to penetrate Asian Pacific countries by establishing new ways of payment such as credit card. The risk was high and the New York headquarters should take a decision soon, in order to face the rival banks. The Asian Pacific countries (Australia, Hong Kong, India, Indonesia, Malaysia, Philippines, Singapore, Taiwan, and Thailand) are emerging markets and their rapid growth economies were incredible for several years until now. Since 1978 Citibank has representation there, but approximately 10 years later (in 1989) launched the most innovative service, a new product named credit card.

Citibank’s mission in the Asia Pacific region was to be the most profitable provider of financial services to an increasingly affluent and middle-income market. First of all, we should bear in mind that entering into new markets means that Citibank has more opportunities to sell the same product to multiple clients or sell multiple products, such as Citibank’s core products, car loans, deposits, and mortgage products, to the same customer. Also, in some countries, there is a very large population of potential customers. In the sector of security, Citibank has quite high technology that can make users feel safe. On the other hand, many people express doubts about this venture. There are many regulations designed to protect local banks and limit the expansion of foreign banks. In addition, there is a lack of credit experience and the market is undeveloped yet. Also, economics in these countries are not as developed as in the United States. In some regions, the risk is high, because of political corruption. I recommend the card launch and I focus on the possibility that some countries could be a success.

However, in the Asia Pacific area, you can find different people among countries, with different habits, traditions, religions, so each country has its own market characteristics in comparison with the others. So, we must take into account the fact that it is impossible for the bank to target all these different countries-cultures at the same time. In my opinion, a “safe” choice could be Malaysia, Hong Kong, and Australia. Malaysia: 16,726,766 population in 1989 and growth rate 8. 1%. It has a successful business population and growing along with infrastructure. Also, the middle and upper class is growing sharply. With 61% of the population living in rural areas, people had plenty of card options to choose from 1989. However, according to Malaysian law, only consumers with an annual income of 9,000$ or more could own a credit card. Also, 25% of its population earns more than 12,000$. Citibank is very possible to get customers in this country, due to the high growth rate, 8% is higher than the average value of the latest 5 years (from 1985 to 1990). A total of 390,000 desired customers could achieve 900,000 cards (regardless of the kind) annually, with revenues approximately 88,200,000$. (Exhibit 4, 8, 10) Australia: 16,500,000 population in 1989, growth rate 4. %, but is already saturated market. However, it is the most stable country with small political/economic risk. An average Australian carries 2 cards. Visa and Mastercard hold 35% of the market, but half of the cards issued by local banks. (Exhibit 4) • Break even: SP-(FC? VC)=BE 525,000-(104,300,000? 626,000,000)=BE 525,000-0. 16=BE BE=524999. 84 SP=10. 500. 000(1)? 5%(2)=525,000 (1)10. 500. 00 cards (2) Market share Hong Kong: 5,709,330 population in 1989, growth rate 7. 3%, is a developed country, with a strong credit card and financial infrastructure. Also, there is wide use of cards and especially for shopping.

By 1989, Citibank held an 8,7% share of the credit card market. Projected 170,000 cards annually, with revenues of 16,279,144$ is the desired result. Break-even: SP-(FC? VC)=BE 12. 18-(104,300,000? 626,000,000)=BE 12. 18-0. 16=BE BE=12. 02 SP=(100,000+140,000)(1)? 8. 7%(2)= 12,180 (1)140,000 Classic and Gold Visas 100,000 Diners Club cards (2) Market share SP: Selling price FC: Fixed Cost VC: Variable Cost BE: Break Even The Fixed Cost (FC) is the same in all countries, so FC=104,300,000$). The Variable Cost (VC) is the same in all countries, so VC=626,000,000$ (Exhibit 3, page 11, Net Income in 1988) Citibank should make concurrent entry to these countries and estimate how many cards totally need to issue in order to achieve the desired profitability. The marketing strategy which Citibank should follow differs among countries. The bank must establish a direct marketing product with Bind-ins, direct sales force, direct mail, and takes-ones. Also must create a Greenfield market development. In the case of Malaysia, the credit card service should focus on family and traveler.

Advertising must be targeted in the countryside (61% of the population living there) in order to earn new customers. In the case of Australia, the marketing strategy should focus on pricing. Joining and annual membership fees should be reduced in order to compete with AMEX and Diners Club. Also, Greenfield’s market development is needed to be more intensive. Finally, in the case of Hong Kong, Citibank needs also to choose Greenfield market development. However, developed operations infrastructure in addition to the trained staff is necessary. The country which Citibank should avoid is Korea. Local regulations do not permit banks to issue cards. Another problem is that transactions must be done only in local currency. This is too risky, so it is better to ignore this region. Taking everything into consideration and for the above-mentioned reasons, I feel that Citibank should launch its new product because it is very possible to succeed in emerging Asia Pacific region. Its experience guarantees a promising future.

Reference

1. http://www.bankersalmanac.com/addcon/infobank/bank-rankings.aspx.
2. http://www.citigroup.com.
3. http://www.geographic.org Vasileios Sekertzis.

Managerial Decision Making Using the six-step Decision-Making process

Identifying the Problem and its details

• A teenager is asking his/her parents to buy a high-end gadget that is the trend/must-have of his/her generation (ex. I-phone or I-pad) as a present for his/her birthday
• The teenager is given an allowance of 200 pesos per school day.
• The family is living on a budget, and is cutting its cost – the parents do not want to spend beyond the allowance of the teenager.
• Therepossible part-time jobs available though there are no known detailed facts on them.

TASK: Help the parents decide on the best solution to the situation/ what to do in the situation.

Developing Possible Alternatives

• Buy Gadget – Buy the gadget immediately; since it is the birthday of their child; he/she will only be a child once in a lifetime, this will show that you really care about him/her.
• Reward System – Negotiation of a reward system for better grades or exam results. The exams results or better grades must be worth the reward.
• Buy Gadget Substitute – Parents can by a substitute of the high-end gadget; which may look like the real thing or have the same functionality with the popular one but with a much lower price.
• Garage sale proceeds – The parent and teenager can agree to sell old items of the teenager via “Garage Sale” and the proceeds of the endeavor will be used to buy the gadget the teenager wants.
• Part-Time Job – The teenager can opt to do a part-time job. It may take time to gather up the money needed to buy the gadget.
• Installment Payment of the Gadget – The parents can buy the gadget via “installment basis” and will cut-off the allowance for a significant amount which will be used to pay/help pay the monthly installment.
• Matching Savings (50/50 savings) – The parent will match the amount of savings per day of the teenager and will deposit the amount to the bank for safekeeping, while the teenager can have the passbook and have a joint signatory with his/her parent.
• Payment by Service – in-house part-time job of the teenager.
• Don’t Buy The Gadget – Let the teenager understand that you are living on a budget, and he/she must do his/her part. Make him/her see that the gadget he/she wants to buy is unnecessary.

Evaluating the Possible Alternatives

• Buy Gadget – “We’ll buy it! Happy birthday… we love you! ”

1. Positive: The parents can make the teenager know that they care for him/her.
2. Negative: The gesture will just spoil the teenager; he/she will not know the value of money/the gadget bought.
3. Negative: The Family is on a budget; expenses should only be on very necessary items – the gadget is more of a luxury the family can’t afford in this day and age.

• Reward System – “Good Job! Here’s your Reward! ”

1. Positive: The teenager will give additional effort in his/her studies and other activities.
2. Positive: The teenager will value more the gadget, since he/she worked hard in studying or do well in other activities to get it.
3. Positive: The System will encourage good behavior and more productive activities.
4. Negative: What if there is no reward? The reward will be the motivation of the teenager and this will complicate relationships, especially when the parent can’t deliver the assumed reward.
5. Negative: could foster an unhealthy reliance on adult opinion instead of forming their own because they are constantly looking for reaffirmation or approval via an adult mandated award system.

• Buy Gadget Substitute – “Here… It has the same features, but it’s more practical…”

1. Positive: If the Teenager can well understand the situation of the family-being on budget; he/she will appreciate that he/she was still bought a gadget of the similar functions.
2. Positive: The teenager will know the value of money.
3. Positive: the teenager will learn to be content on simpler things.
4. Negative: since the teenager knows that the gadget is cheaper, he/she will not value/take care the gadget.
5. Negative: the teenager may become disappointed that he/she is only given a substitute of the one he/she wants.

• Garage Sale Proceeds – “To buy what you want, you must sell what you don’t need. ”

1. Positive: The teenager will value the object, since he lost something he had in order to get it.
2. Positive: The teenager’s skill in selling items will be exercised – he is practicing to be a new entrepreneur.
3. Positive: The teenager’s room will be more in order.
4. Negative: What if the teenager’s want is not moral/not good? – He/she will sell what he/she has just to get it. Even worse, he/she may sell all the items in your house.
5. Negative: Sense of Sentimental value for things will not be recognized by the teenager.

• Part-time job – “If you really want it, you must work for it. ”

1. Positive: It gives the sense of independence to the teenager.
2. Positive: The teenager will learn the skills of Time Management. iii. Positive: The teenager will have his/her own source of income.
3. Positive: He/she will learn the value of money – he/she will learn that it is not easy to obtain/earn it.
4. Negative: It will be hard for the teenager to focus on his/her studies.
5. Negative: he/she will be tempted to drop out of school, since he/she has already started to earn money.
6. Negative: He/she will be stressed in handling both schools and work.

• Installment payment of Gadget – “You’ll pay for it over a period of time with part of your allowance. ”

1. Positive: You can put it in your budget. Instead of paying the full amount, you can pay for it over the period of time.
2. Positive: Some networks/Company offers bundles including their service (Post Paid plans of Networks)
3. Positive: The teenager will learn how to budget his finances.
4. Negative: The interest is high when you pay for an item in an installment basis.
5. Negative: The teenager may learn of other ways to earn money (which may not be good) – to compensate for the cut in allowance.

• Matching savings – “I’ll match what you save, so we can buy it. ”

1. Positive: It gives a sense of partnership between the teenager and the parents.
2. Positive: It teaches the teenager the value of savings.
3. Negative: He/she will be more eager to save; he/she may sacrifice his/her basic needs just to buy the item.
4. Negative: He/she may not exert more effort to extra-curricular activities which could enhance his skills and knowledge. . Negative: Since the teenager is saving, He/she may not mingle more with friends who could hurt the development of his/her social skills.

• Payment by service – “I’ll buy it, but you’ll have to do this…. ”

1. Positive: The teenager will learn that you need to do something before you can have something.
2. Positive: The teenager will learn how to be patient.
3. Positive: Teenager will learn the basic household skills which are very important in the future.
4. Negative: The teenager will not do anything inside the house if not paid/rewarded of some kind.  Negative: There will be no sense of responsibility for the child – since he/she will do the household chores for a price.

• Don’t Buy The Gadget – “We don’t need it, we must buy only necessary things”

1. Positive: If the teenager will understand that they are in a budget – he/she will learn the value of thriftiness and buying only the necessary things.
2. Positive: The Money will be used to buy more necessary items.
3. Negative: If the teenager will not understand – the teenager may be disappointed and could ruin their relationship

Recommendation of An alternative (or Make the Decision)

My recommendation is more of a combination of different Alternatives stated above. First is having a conversation with the teenager, it is very necessary to make him understand the situation – the family is on a budget. Second, it is also essential that the teenager has a part in buying the gadget – he/she must have a contribution, preferably money he/she earned. Third, the deal must be designed in a way that establishes more trust between the parents and the teenager, as well as prepare for his/her future.

My recommendation is the Matching Savings Alternative combined with Part-time alternative – this motivates the teenager, as well as teaches him to save and to budget his finances. Having the Matching savings alternative minimizes the pressure to the teenager in his work, while the Part-time alternative minimizes the pressure of saving and sacrificing the school day allowance. This combination establishes a partnership between them, as well as teaching the teenager the important mindset and skills he will need in the future.

Also this kind of joint venture could work for any other project and/or for his future needs. . What is required for the Alternative (Implementation of the Decision) To implement the combination, you must help the teenager find a part-time job, one that does not conflict with his studies – weekends. You will also want to open an account with the bank; some banks have these kinds of accounts (ex. WISE account of RCBC)- Joint account, while giving the custody of the passbook to the teenager – as a sign of trust.

How to Monitor Solution/What are the possible effects of the Alternative (Monitor you solution)

It is very important to monitor/tract the progress of the solution, especially for this combination. The monitoring control could either be the weekly or monthly deposit of the Matching savings alternative – check to see whether the money is already enough; this recurring activity could also serve as a bonding moment between the parents and the teenager which could deepen the relationship. It is also very essential that the parent will motivate the teenager from time to time especially with him/her having a part-time job – on the road to his/her independence.

Customer service is important in any organization, industry or firm. It ensures that satisfactory services are provided to the customer or clients during and after they have purchased goods or services. Customer service ensures that there is customer retention which by and large determines the sustainability of an organization. A good customer service will involve more that smiling at the customer as there will be need to establish and meet the needs and expectations of the customer. This paper will focus on how the issue of customer service is dealt with in Athens, Greece.

Athens is the capital city of Greece and it prides itself in a strong or solid culture that is characterized by the Greek language and orthodox Christianity. It is a very vibrant city in as far as Greece economic, cultural as well as the political aspects is concerned. Many people live in Athens compared to the overall population. (www. cs. phs. uoa. gr). In Athens, the service sector is the most significant and it comprises of the banking, government administration, transportation as well as health care.

The role the tourism industry cannot be underestimated as it contributes to the economy of Athens. It attributes its success to the presence of monuments, museums and international events for instance the 2004 Olympic Games. Excellent customer service is a plus to the performance of tourism. (www. athenscity. gr). The airline industry is also critical in ensuring the effectiveness of the tourism industry. Good customer service in any industry will keep the customers flowing and this translates to higher revenues and consequently higher profits.

In this regard the Athens International Airport for instance ensures that customers or clients needs are well addressed. It sought the intervention of the Erickson Company that enabled it to increase its mobility levels. It ensured that it had established high standards of customer satisfaction with the proper communication system. It was also able to improve its efficiency and flexibility not only to its employees but also to the customers. (Erickson, 2007).

Shipping is also an important industry in Athens and to ensure that it flourishes it will be vital that an excellent customer service is maintained. Companies in this industry like Velos Hellas are aware of how important the customer service and have adapted a culture where they are committed to offer a high standard, quality and reliable services that will meet the customers needs. They are also concerned with providing affordable rates in a timely manner. (www. veloshellas. gr).

The car and rental companies facilitate the flow or rather movement of people from one region to the next. These companies have a great contribution in ensuring that the tourism industry is flowing successfully. As the ACE Rent A Car Agency which comprises of more than a hundred car rental agency points out these agencies have a passion for customer service. (Agency Profile, 2008). ACE has been operational for over 23 years and this proves that foe many years the car rental companies aim at ensuring that the customer needs are met.

An excellent customer service in this business will ensure that it serves a higher number of clients who include government officials, tourists as well as corporate clients. Offering distinguished services will place any company at a competitive edge as with the intense competition in almost all industries prices are regulated and there is need to consider other issues to increase the companies’ attractiveness. (Agency Profile, 2008). To ensure an excellent customer service it is important to offer personalized services.

Identifying the customer needs and expectations is important as it will enable the relevant companies address them amicably. The banking sector in Athens is also very competitive and most banks have to ensure an excellent customer service. Some of the tactics applied can be through the introduction of the queuing method where service is based on a first come first served basis. This approach will ensure that there orderliness and it also reduces consumer complaints. To establish the actual needs of the customers it is appropriate to carryout an intensive research.

The role of the new media in enhancing the customer service in Athens is very significant. Through the Internet the provision of quick responses to customers’ queries is done efficiently. The banking industry has introduced the Internet banking which not only enhances its daily operations but makes it more profitable for the banks. As Vadlamani in the book ‘Advances in Banking Technology and Management: Impacts of ICT and CRM, points out with the current global competition the banking system has been forced to become more supple and customer focused.

The development of information and communication technology (ICT) has made a great impact in the business world as a whole especially on its role in enhancing customer service. The customer service in most organizations in Athens can be said to be effective and this is attributed to the fact that with the increasing competition there is need to adopt other means of attracting and retaining customers. An excellent customer service ensures that the organizations revenues are high as customers keep flowing in.

Ensuring that employees are satisfied is an important way of ensuring that they work towards enhancing the customers or clients satisfaction. References: Athenscity. gr. 2008. About Athens Retrieved on 25th July 2008 from http://www. athenscity. gr/. Vadlamani Ravi. 2007. Advances in Banking Technology and Management: Impacts of ICT and CRM. Idea Group Inc (IGI) Erickson. Customer success story: Athens International Airport Greece: Athens International Airport to build the foundation of continuous and future success.

Retrieved on 25th July 2008 from http://archive. ericsson. net/service/internet/picov/get? DocNo=21331-EN/LZT1023932&Lang=EN&Rev=A Velos Hellas. 2007. Our services know no borders. Retrieved on 25th July 2008 from http://www. veloshellas. gr/services. html. Agency Profile. 2008. Ace Rent A Car Athens. Retrieved on 25th July 2008 from http://www. carrentalexpress. com/rez/ace-rent-a-car-athens/profile/ Greece. Retrieved on 25th July 2008 from http://www. cs. phs. uoa. gr/delphi2004/travel-information-greece. html.

Among other things, I have this diversity of experience to offer the Global Transaction Team. My passion for sustainable environment and resource protection is more than a decade. My University project research investigated the effects of tannery effluents and other industrial wastes on aquatic resources, 2000. Collected effluents from industries in plateau State, Nigeria and prepared various concentrations with which I exposed Recommits SSP (Tailpipe). The findings were valuable and highly revealing.

These findings have been used by government agencies for regulatory policies. In my first degree I was awarded the University Scholar Award and university undergraduate scholarship consecutively for 3 years and graduated among the best. Over the years I worked in the Banking and Finance industry in Nigeria. I have processed facilities for financing small to medium and large scale enterprises and have managed these business relationships and portfolios for several years. This in the long run will contribute to a strong private sector-driven economy.

In the past four years, I worked as Head of Operations, Zenith Bank Ply leading a team of hardworking and result-oriented workforce. Professionally, I have contributed innovative to the growth and success of my organization as the founding member of the bank wide operations committee. My responsibilities include sound business decisions, dispute resolution, negotiation and commercial skills. I trained in Leadership skills, interpersonal skills, Risk management, financial statement analysis, Credit assessment, Effective Writing, Communication, and Management skills and on a leadership Award in the Bank in 2012.

My present field, MBA in Agribusiness, has given a strong foundation to my analytical skills focusing on Quantitative Techniques in Management, Research Methods and Statistical Analysis, and a deeper understanding into the Principles and Practice of Crop Production, Principles and Practice of Animal Production, Fisheries Management, Commercial Production of Foodstuffs and Quality, Food Processing Technology and Practices, Food Industry and Agribusiness System, and Economics for Agribusiness managers among others.

My most recent reservation on Integrated Fish Farming was rated excellent. This study focused on Echo-Farming in which the maximum utilization of resources including wastes is proportionately related to minimum damage Of the environment. I pointed to the consciousness of my audience why the world food production could grow significantly to feed the ever growing population, yet the loss of soil fertility, industrial activity and solicitation of agricultural lands will continue to hamper such increased productivity.

Suggesting, I reiterated organic waste reclamation, recycling and re-use in integrated yester with treatment, incineration, landfill and composting to drastically reduce waste, and achieve minimum disruption to the environment, as well as the best financial result possible. Such is evidenced in Shanghai Farms, Porto novo. My primary interest lies in Agribusiness and I will explore its great potential to generate jobs.

The practical agribusiness-based MBA understudies agricultural farms with direct experiences such as Durance Farms, and Charter Farms practicing commercial production in fisheries and poultry, as well as other commercial farming of Cassava, Rice, and Yams etc. Seed in production of a variety of staple foods, and also as industrial raw materials for Ethanol, Starch industries etc. Animal husbandry employs sellers, farm attendants, veterinary doctors, feed millers, researchers and transporters.

He later moved to Italy where he got kicked UT of school because he was setting a bad example to other students despite his fascination in Math. After leaving school he decided to become a math teacher to support him in his studies of math and physics. In 1896 he entered the Swiss Federal Polytechnic School in Zurich, Switzerland to train to become a teacher in physics and mathematics. He failed the first attempt but passed the next year and gained his diploma, and accepted a position as a technical assistant in the Swiss Patent Office.

In 1905 he obtained his doctors degree, ND was also the year he published four of his most influential research papers. One including his world famous equation e=Mac that unlocked mysteries of the universe unknown. Later in 1914 he was appointed Director of the Kaiser Wilhelm Physical Institute and became professor in the University of Berlin. Ten years later in 1915 Einstein completed his general theory of relativity, and in 1921 he was awarded the noble peace prize for Physics. It launched him international fame and he was thought a genius all over the world.

Later on in 1933 Einstein immigrated to America to become professor of Theoretical Physics at Princeton. He became a United States Citizen in 1940 and then retired in 1945. Einstein then died on April 18, 1955 at the age of 76, and donated his brain and vital organs to scientific study. Albert Einstein has several Scientific Contributions one of which is the Quantum Theory. He suggested that light doesn’t travel in waves but as electric currents; from his theory inventors were able to develop television and movies.

For my Business Studies coursework I will be focusing on a small sole-trader business named Errol Anderson Motors in the area of Harrow. The owner, Errol Anderson, is about to start up his own business; primarily serving as a car mechanic’s garage. He has asked me to help him draw up a marketing strategy. A marketing strategy consists of the main plan a business must follow to succeed. Errol must consider many factors which would affect his success – he must incorporate his ideas into plans which would help him in the long term or for a short term.

Examples of some of these factors are his media choices, market research, and marketing in general. Errol Anderson Motors was established as a result of Errol’s strong passion for cars and mechanical engineering. Errol had been working for David Turner, who mentored and aided him into becoming a well experienced and matured mechanic. Errol, after having reached the highest possible status in the job next to Mr Turner, continued to develop his customer service skills and broaden his ever-growing knowledge of cars.

However, Mr Turner desired to retire to Scotland with his family, as he fell ill from old age. This is when Errol decided to found his own company. He was confident that he had enough skill and experience to build a company just as successful as Mr Turner’s, and perhaps surpass it. Mr Turner was keen to aid Errol undertake this venture, and offered all the information he could give, and was also willing to sell all his tools and equipment from his garage at a reasonable price. Errol set the issue straight with his family, and discussed loans with his Bank Manager.

His Bank Manager drew attention to the fact that Sole Trader businesses do not usually survive so easily in the first year – there are many other garages in Harrow that could attract Errol’s many potential customers. He also made Errol understand other problems which he would face; Errol had no idea of where he could manage to obtain revenue to finance his business – he could not keep taking out loans. The Bank Manager strongly advised that Errol plan a highly efficacious marketing strategy – which unfortunately Errol had little understanding of.

This is where I have been called to assist. Errol’s main aim at first is to survive. There are many other competing garages which could easily snatch away potential customers from Errol if he does not apply an appropriate marketing strategy effectively. To start up a business, the entrepreneur (risk-bearer who brings together all the factors of production to start up a business, i. e. Errol) needs: * Finance – to fund the other factors listed below: finance is usually the most difficult thing to obtain in a business that is starting up.

Errol must use his own savings, or loan off banks or perhaps his family. He must “ration” his capital, as he needs the money to pay back loans and as much money to fall back on as he can, in case of an incident such as the opening of a rival garage who appeal more to Errol’s customers. When the business is established enough, Errol could set his eyes on an aim such as profit maximisation – trying to make the most profit possible, e. g. utilising effective promotional campaigns.

After this, Errol could aim to try to make a sufficient amount of profit to keep him comfortable – this would an ideal aim of a small business such as Errol’s, as he would not want to work longer hours. “Marketing Media” defined; it is a way of communicating a promotion to potential customers, e. g. through advertising, public relations, or sponsorship. I will now list the different forms of marketing media in the advertising area available to Errol with examples of each in the form of spider diagrams.

The two types of advertising both depend on the business’ stature and their target audience (local or worldwide/nationwide). “Above-the-line” advertising is usually the choice for big businesses who would want to promote their product or service via television, cinema, radio, newspapers, etc. “Below-the-line” advertising would be more suitable for local area businesses who would want to make their business known to the public via local newspaper, council magazines, directories, etc.