Paralegal Class Assignment Example | Topics and Well Written Essays - 250 words

Paralegal Class - Assignment Example Since it is a legal firm, they are also required to have excellent communication skills. Since the law firm is a very busy environment, they should also have the ability to multi-task, meet strict deadlines and also have to be flexible to work at odd hours. I find this job advertisement interesting because they place emphasis on fresh graduates with hardly any experience in order to mold them to be what the company needs. The notice was found in an easy internet search. Checks and balances are put in place to make sure that each of the three arms of the government, the legislature, the judiciary and the executive, does not have too much power. For instance, article two section 4 states that the president, the vice president and other civil officials shall be removed from power if they are proven guilty of any acts of corruption. The president or the civil servants do not have the power to absolve themselves of the acts of crime should the congress decide to impeach them (Article 2 Section 2). Article three Section one states that judicial power shall be decided upon by the Supreme Court or any other court as deemed fit by the Congress (Article 3, Section 1). Article one Section one says that the Congress has the right to decide upon how much power the legislation has (Article Section

Learning and Teaching Assessment Essay Example | Topics and Well Written Essays - 2000 words

Learning and Teaching Assessment - Essay Example As the author of this assignment, I am a nurse in one of the busy surgical wards in Singapore, where at times students are posted for their placements. The Gibbs Model of Reflection (1988) This model mainly takes place in six stages. These are the first stage that comprises description stage that makes it necessary to identify and describe the events, the second stage that is made up of the feelings and thoughts from where the feelings and opinions of both the mentor and the student are recognized. The third stage is that of evaluation where a description about what is good and bad in relation to the event is necessarily provided. In the fourth stage, which involves analysis examines the event and the expansion of knowledge that encourages the student to see and make sense out of the situation. The fifth stage is made up of the conclusion where the new knowledge acquired as well as any other step that should be taken are recognized. The sixth and final stage involves the action plan through which the acquired new knowledge is related to a forthcoming experience. Stage 1: Description As the mentor, I conducted a mid placement interview assessment on Catherine who seemed to fail in the achievement of some of her learning outcomes as a 2nd year student. As I found out, Catherine experiences some difficulty in communication with her staff mates and patents as well. She is not well conversant with the English language and thus finds it difficult to communicate some of the terminologies with the patients and her colleagues. With this, she usually finds it very difficult to make herself understood. Despite these, she also exhibited some extremely positive sides in that she was very professional, courteous and hardworking... This essay approves that if a student is to pass a placement, the mentor should ensure that they are confident about patients being in safe hands in the future. This is if the students proceeds with the routine and qualifies to be a nurse. It is also vital that mentors are not afraid to fail students. They should additionally realize that failing students are identified so as to prepare for greater achievements within the clinical practice. This report makes a conclusion that mentoring is a significant complex and challenging task. However, to make the task much easier the mentor should apply some of the available models. In this case, chose to use the Gibbs model as the reflective framework due to its efficient outline in helping to handle the problem at hand. This is applicable in the initial, mid and final processes of the mentoring and assessment process. The chances of availability of learning difficulties in a student should be identified early enough to give the student a chance to develop an action plan that helps them to achieve their learning outcomes. With it, both the mentor and student in this case were able to realize that learning is a proactive process. In addition, it also requires a conducive clinical environment in which the student works. Moreover, feedback, which should be constructive and continuous, should be importantly provided. It is because students find it extremely useful in understanding an y of the concerns that a mentor may possess.

The concept of net present values can be used in this situation to Essay

The concept of net present values can be used in this situation to advise Harriet on the most appropriate action to take - Essay Example The most suitable payment option of the two can be chosen with the help of present value concept. Harriet should choose the option which provides the lowest cost to be paid for the purchase of TV. The first option involving a complete payment of 899 today is to be compared with the second option suggesting payment of 50 in the beginning with 40 to be paid every month for the next 2 years. The present value of 899 to be paid today is simply 899. However, the present value of 50 today + 40 monthly for 24 months needs to be calculated. For this purpose the values of monthly payment needs to be discounted back at the rate of return Harriet expects to earn on an alternative investment. This would provide the present value of that series of payment that the purchase of TV requires. Because of the fact that there is equal monthly outflow, the NPV can be calculated with the help of the following formula: The above calculation suggest that Harriet will actually be paying 981 as the total cost of purchasing the TV if she decides to accept the second option i.e. 50 plus equal monthly payment for the next 2 years. However, if Harriet decides to pay the cost of TV today, she would only be paying 899. This illustrate that Harriet will have to pay 80 in excess of the cost of TV if she agrees to pay in future instalments. Hence, on the basis of the abov... Hence, on the basis of the above calculations, it is advised that Harriet should pay the cost of TV today i.e. 899 because of the fact that she will have to bear higher cost if she pays in instalments. Part 3: Limitations of NPV as a Method of Investment Appraisal Despite the fact that Net Present Value or NPV serves to be the most important of all the available investment appraisal techniques, there happen to be several limitations of this method. The first drawback of using NPV as investment appraisal is this method's reliance on discount rates which should represent the opportunity cost of capital. This opportunity cost of capital might be the cost of funds employed in the investment, rate of return on alternate investment and inflation etc. The determination of a correct discount rate is very important in the calculation of NPV as it is the rate which is used to discount back the value of future cash inflows to their present values. An inaccurate estimation of discount rate will lead to acceptance of a wrong project or rejection of a right one. Another important point to be considered in calculation of NPV is that the method does not consider risk involved in accepting a project. It just evaluates a project on the basis of time value of money. However, there are several risks that are involved in starting a new project other than the time value of money such as business risk, financial risk, market risk, industry risk etc. A high NPV project might be having huge risk as compared to a low NPV project. The decision criteria made solely on the basis of NPV with no consideration for project risk can be misleading. Even if a risk premium is added to the discount rate, NPV will assume that the risk rate

Why was decolonisation so rapid Essay Example | Topics and Well Written Essays - 2000 words

Why was decolonisation so rapid - Essay Example The political situation after World Wars I and II in Europe was one of the most influential factors in decolonization process. The new influential parties started to develop in colonies with the objective to resist the royal rule. South Asia, for example, has much advanced in political power: Gandhi has played an important role in raising the question of national sovereignty. Communistic parties of North Africa were also demanding the end of colonial power. France and Britain remained the key political players in Europe, however, they failed to restructure their colonial administration and the process of decolonization became unavoidable. Few years after the war, both French and British empires were struggling to preserve their colonial ruling. The British Empire became the Commonwealth of Nations, while France was classified as the French Union or the Community since 19451. French politicians still believed in the unity of colonies, while the British colonies moved towards the autonomy. The political change was required – the first step in this direction was political participation of local population instead of European administration in politics. Colonial agencies became elective governmental bodies. In 1950s these formations acquired the national status and the national leaders of colonies did not see the need to be part of the colonial government. France and Britain were unable to control the political life of their colonies any more and one after the other, the colonies became independent. African and Caribbean colonies received sovereignty peacefully. There were tensions only with two colonies: Indochina and Algeria. France was much determined to preserve political power over these two colonies. Between 1947 and 1954, the French were fighting against the local armies with the effort to prevent the collapse of empire2. The situation in Vietnam (1954) was not better as well – the French military forces were demolished

This report will be focusing Essay Example for Free

This report will be focusing Essay This report will be focusing on the different functional areas of a business, i. e. Administration, Finance and Human Resources Task 1 Functional Areas are the different areas of a firm. Each functional area has a different objective to the next. Sales will be the main turnover part of the business whereas Human Resources (HR) will be the hiring and firing of personnel. Marketing are in touch with the consumer and Finance take care of the money. The different areas include (but are not limited to): Human Resources, Marketing, Sales, Finance, and Administration (also known as Admin) And Customer Services. Task 2 This table shows which Department or Functional Area has the most importance and what they do Department Explanation Activities Importance Human Resources This functional area has the responsibility of using and developing the organisations personnel in the most productive way. Hiring and Firing, taking interviews. Making sure the employees are happy and, in some cases dealing with pay negotiations and dealing with strike situations Very Important as without HR there wouldnt really be any employees. Without happy employees, there could be strikes etc. Administration IT Services Administration provide the backup needed to run every other department, i. e. the day-to-day jobs Dealing with post, photocopying, dealing with visitors, telephone switchboard, IT Services Probably the most important as no other function can work without it, especially without IT support Finance Managing the money coming in and out, paying taxes and raising money for the business Handling money, paying the VAT man, handling taxes Very important the CEO would get indicted for not paying VAT and Tax Marketing Sales. Finding out what products customers need and advertising the products to them Advertising and selling the product to the customers Very important as without selling your goods you wont have any income Customer Services Looking after customers requirements and dealing with their complaints Contacting customers and being contacted about returns, advice, complaints and enquires Probably the least important as once youve sold your product you dont really need any further contact with the consumer Task 3 Charlton Athletic FC Human Resources. One specialist personnel officer who is responsible for all aspects of training, recruitment, interviews and development. Managers of all departments also have a responsibility for some aspects of various personnel issues. Payroll section responsible for paying all departments Finance Each department has its own budget and must meet all costs from this. Departments may request emergency funds if the budget is overspent Administration Each senior manager has his/her own Personal Assistant. Everyone does their own administration. The admin dept. also has the I. T. department within Marketing 3 Departments who deal with the marketing and sales aspect of the firm Marketing Department This department deals with sponsorship and selling stadium boxes to the public for matches Communications Dept. This department designs and updates the website, also they design, write and print brochures and matchday programmes Public Relations (PR) The PR dept. deals with player appearances to the press, they deal with all press enquiries and arranging player interviews on T. V. and Magazines Charlton also have a Schools Visit Programme in which they visit schools in Kent and South-East London to further the Charlton reach. Customer Services Charltons Customer Services department doesnt actually exist. Complaints are dealt individually with by the manager of each department. Chartlon apparently take complaints very seriously. Big complaints may be dealt with by the Chief Executive of Charlton himself. Any complaints not dealt with by the club may be handed to an independent inspector from the IFC (Independent Football Commission). Bromley Library Human Resources 42 people in total work in the Library which is down from last year The different roles include Group manager, Assistant Director of Education who is the chief librarian and Senior Customer Service Manager. You could argue that the Director of Education, Ken Davis is the head of the library There is a central HR section within the Education and Libraries dept. The HR dept. is mostly training and hiring new All Bromley Libraries put together get an average of about 2-3000 visitors a day so health and safety is important. There is an HS Executive who visits all the libraries and investigates certain problems Finance It is a legal requirement that Libraries cannot charge for books but libraries can charge money for videos, DVDs and CDs. Their funding includes New Opportunities grants (A Lottery Fund) and Government Grants. Administration This includes an IT repairman with a team of technicians who goes out to branches to sort out any IT problems Task 4 Internal Communication: Communication between the different functional areas and different people within the same functional area of the same company. External Communication: Communication to someone outside of the company, for example Banks, Suppliers, Customers, Shareholders, Stakeholders etc. Task 5 Type Of Comm. Explanation Advantage Disadvantage Verbal Conversation A real-life conversation between 2 or more people, face-to-face. Feels more personal, no technology that can fail and interrupt your conversation Someone can overhear your private conversation Telephone Conversation A conversation between 2 people on the telephone Can be private as it is only you and the other person that can hear Can get cut off, can be expensive Telephone Conferencing. A telephone conversation between more than 2 people Talk to you work colleagues when you are all in another country If one person gets cut off the conversation cannot continue without him/her. Expensive Meetings A formal meeting between important people in the firm. Usually no more than 10-15 people Meetings can be a useful place to share ideas You might not want to be in the same room as someone Video Conferencing The same as telephone conference but with a live video image of the person(s) you are speaking to. Video conversations can be made with a 3G (3Gigabit) phone or over the internet using MSN Messenger, Yahoo! Messenger or Skype 2 Seeing your colleagues can be more personal and can feel like a meeting If one person wants to leave the entire conversation stops. Can be expensive Letters A formal external communication method between to groups Letters are always clear and to the point Slow to arrive and get lost on the post. Post is 29p Email is free Memos An internal form of letter, usually less formal Will always reach the person as it goes through internal mail Takes a long time to reply Email An electronic mail that can arrive in another part of the world in less than 3 seconds. Can be used for anything and does not have to be formal Can reach the other side of the world in around three seconds. Can be replied to instantly. Can be sent to more than one person instantly Sometimes too informal and can be lost on servers Fax A written document that is scanned and sent across phone lines A letter that can reach the other side of the world in seconds Can get lost on the phone lines. Document may not scan well. Black and white only Notices A kind of memo pinned to a notice board to inform the passers-by Notices can inform anyone about what is going on and it cannot be private May not reach the person(s) you want it to Skype and other VoIP applications It allows you to make free calls to other Skype users and very cheap calls to Landlines and Mobiles. Now, with Skype 2 you can add video to your conversation A cheaper alternative to making phone calls. The call is sent over your broadband connection so is quick and clear. No national or international charges You have to pay (albeit very little) for calls to landlines and mobiles   Aaron L. Lovegrove Page 1 09/05/2007 Page 1 of 7 Business Studies Unit 1 Functional Area.

Fredrick W Taylor Essay Example for Free

Fredrick W Taylor Essay Frederick W Taylor was one who led a life of earnest development in the production and manufacturing sectors. His life was one the spurned on time study and one that advanced America and the world in scientific management. Taylor was born in Philadelphia, Pennsylvania on March 20, 1856. He lived an eventful and noble life for 59 years and one day dying on March 21, 1915. Throughout his lifetime he was a great inventor with over 40 patents and a brilliant engineer (Britannica). In his early years Taylor was always learning and creating. At age 12, Taylor created a harness that would keep him on his back to try and prevent nightmares (www.stfrancis.edu). In 1872 he went to the Philips Exeter Academy in New Hampshire. Here he led his class scholastically. After his completion of studies at Philips Taylor started working as a machine shop laborer in a steel plant named Midvale Steel Company. Quickly Taylor started to grow in position; he became a successful shop clerk, machinist, gang boss, foreman, maintenance foreman, head of drawing office, and finally chief engineer. It is evident to see that Taylor was a man of wisdom and drive, who never settled for anything less than the best. In 1881, at age 25 he introduced time study at the Midvale Plant. The project was a great success and as a result the profession of time study was started. While working at Midvale, Taylor studied at night to get a degree in mechanical engineering from Stevens Institute of Technology. As can be seen even from an early age Taylor had successes in new areas of study which spurned on his later life accomplishments. Throughout Taylor’s mid and late life he continued to advance and spread his knowledge of time study. He retired at age 45, after that he, his wife and their three adopted children lived in Philadelphia from 1904 to 1914. He continued to devote money and time to promote the principals of scientific management through lectures at universities and professional societies (Britannica). In 1906 Taylor was elected the president of the American Society of Mechanical Engineers and that same year was he was awarded an honorary doctor of science degree by the University of Pennsylvania (Britannica). Taylor was a man of expert wisdom and foresight and it is seen throughout his life as we just discussed but these characteristics primary shine when you look at his theory and successes of time study. He realized that production could be increased by standardizing this system of work (smallbusiness.chrono.com). Taylor’s time study theory was that he would break each job down into specific tasks and timed how long it took a worker to complete each task (smallbusiness.chrono.com). Then he specified exactly how each task was to be performed and what tools to use, then the workers were trained to complete the task in a certain way (smallbusiness.chrono.com). He did this because he believed that there was one and only one method of work that maximized efficiency as he said, â€Å"And this one best method and best implementation can only be discovered of developed through scientific study and analysis.† (Vincenzo Sandrone). He proved this theory at the Bethlehem Steel Works where they had 500 men shoveling coal. He performed his time and motion studies and found out that using a different shovel for different size coal that it increased the amount you could shovel. So as a result of these two studies men could shovel more coal for a longer period of time. Thus he effectively reduced the number of men shoveling coal to 140 (smallbusiness.chrono.com). This is the reality of his theory and the results speak for themselves. Also, Taylor worked alongside Henry Ford to create the first assembly line (smallbusiness.chrono.com). Taylor also used his expertise and applied it to moving pig iron. He increased the amount moved from 12.5 tons per a day to 47.5 tons of pig iron a day. This leads to another point of Taylor’s theory and it was that he believed that you had to choose the right people for the task. Relating the example just mentioned, Taylor said that not all workers were fully capable of moving 47.5 tons of pig iron per a day, perhaps only 1/8 of the pig iron handlers were capable of doing that. This is because their physical capabilities were well-suited for moving pig iron. This is Taylor’s point, that workers should be picked according to how well they suit a particular job. Taylor also had a motivational theory, called the economic man (Business Studies). This was that workers were motivated or encouraged by money alone and the only factor that could stimulate further output or work was the chance of earning extra money (Business Studies). Taylor always said that workers should be paid a ‘fair day’s pay for a fair day’s work’ and that the pay should be directly linked with output (Business Studies). This leads to a further point of Taylor’s, and it is called ‘piece rate’. To encourage this, workers were pay by each unit that they produced, and the first unit were paid at a low rate and the more the worker produced that higher the pay they received. He also believed that incentive wages were of no use unless they were coupled with efficient tasks that were carefully planned and easily learned (www.stfrancis.edu). Thus is Taylor’s main motivational suggestion; to link pay with output. Taylor also standardized the role of management. This included setting managers apart from operations and giving them more authority to set the tasks workers do (smallbusiness.chrono.com). Taylors’ attitudes toward workers were laden with negative bias â€Å"in the majority of cases this man deliberately plans to do as little as he safely can.† The methods that Taylor adopted were directed solely towards the uneducated (Vincenzo Sandrone). Taylor believed that the secret of productivity was finding the right challenge for each person, then paying him well for increased output (www.stfrancis.edu). He believed that incentive wages were no solution unless they were combined with efficient tasks that were carefully planned and easily learned (www.stfrancis.edu). Throughout this passage it is evident to see what a work Taylor accomplished. He is the father of scientific management and the one who spurned off time study. Taylor spent his whole life increasing efficiency in the workplace, working with making people and companies, most notable, Henry Ford. He and many others of his time like Henry Ford did work that put the United States on the leading edge during the Industrial Revolution. Bibliography 1. Frederick Winslow Taylor, Mary Ellen Papesh, www.stfrancis.edu/content/ba/ghkickul/stuwebs/bbios/biograph/fwtaylor.htm 2. Britannica, Frederick W Taylor, www.britannica.com/EBchecked/topic/584820/Fredrick-W-Taylor. 3. Herzberg Taylor’s Theories of Motivation, Lisa Magloff, Demand Media, www.smallbusiness.chrono.com/herzberg-taylors-theories-motivation-704.html 4. Frederick W Taylor: Master of Scientific Management, www.skymart.com/resources/leaders/taylor/asp 5. Business Studies second edition, Peter Stimpson and Alastair Farquharson, Cambridge University Press 2010

Commercial Risk in International Business

Commercial Risk in International Business What is International business ? International business is a term used to collectively describe all commercial transactions (private and governmental, sales, investments, logistics, and transportation) that take place between two or more nations. Usually, private companies undertake such transactions for profit; governments undertake them for profit and for political reasons. A multinational enterprise (MNE) is a company that has a worldwide approach to markets and production or one with operations in more than a country. An MNE is often called multinational corporation (MNC) or transnational company (TCN). Well known MNCs include fast food companies such as McDonalds and Yum Brands, vehicle manufacturers such as General Motors, Ford Motor Company and Toyota, consumer electronics companies like Samsung, LG and Sony, and energy companies such as ExxonMobil, Shell and BP. Most of the largest corporations operate in multiple national markets. Areas of study within this topic include differences in legal systems, political systems, economic policy, language, accounting standards, labor standards, living standards, environmental standards, local culture, corporate culture, foreign exchange market, tariffs, import and export regulations, trade agreements, climate, education and many more topics. Each of these factors requires significant changes in how individual business units operate from one country to the next. The conduct of international operations depends on companies objectives and the means with which they carry them out. The operations affect and are affected by the physical and societal factors and the competitive environment. Objectives of International Business: sales expansion, resource acquisition, risk minimization. What are Risk In International Business ? Companies doing business across international borders face many of the same risks as would normally be evident in strictly domestic transactions. For example, * Buyer insolvency (purchaser cannot pay); * Non-acceptance (buyer rejects goods as different from the agreed upon specifications); * Credit risk (allowing the buyer to take possession of goods prior to payment); * Regulatory risk (e.g., a change in rules that prevents the transaction); * Intervention (governmental action to prevent a transaction being completed); * Political risk (change in leadership interfering with transactions or prices); and * War and Acts of God. * The risks that exist in international trade can be divided into two major groups: Economic risks . Risk of insolvency of the buyer, . Risk of protracted default the failure of the buyer to pay the amount due within six months after the due date . Risk of non acceptance . Surrendering economic sovereignty * Political risks . Risk of cancellation or non renewal of export or import licences . War risks . Risk of expropriation or confiscation of the importers company . Risk of the imposition of an import ban after the shipment of the goods . Transfer risk imposition of exchange controls by the importers country or foreign currency shortages . Surrendering political sovereignty  · Exchange rates * Price for which the currency of a country can be exchanged for another countrys currency. Factors that influence exchange rate include (1) interest rates, (2) inflation rate, (3) trade balance, (4) political stability, (5) internal harmony, (6) high degree of transparency in the conduct of leaders and administrators, (7) general state of economy, and (8) quality of governance. Risks in international trade can be divided under several types, such as: Economic risks: * Risk of concession in economic control * Risk of insolvency of the buyer * Risk of non-acceptance * Risk of protracted default i.e. the failure of the buyer to pay off the due amount after six months of the due date * Risk of Exchange rate * Political risks: * Risk of non- renewal of import and exports licenses * Risks due to war * Risk of the imposition of an import ban after the delivery of the goods * Surrendering of political sovereignty Buyer Country risks * Changes in the policies of the government * Exchange control regulations * Lack of foreign currency * Trade embargoes Commercial risk: * A banks lack of ability to honor its responsibilities * A buyers failure pertaining to payment due to financial limitations * A sellers inability to provide the required quantity or quality of goods Others Risks : * Cultural differences e.g., some cultures consider the payment of an incentive to help trading is absolutely lawful * Lack of knowledge of overseas markets * Language barriers * Inclination to corrupt business associates * Legal protection for breach of contract or non-payment is low * Effects of unpredictable business environment and fluctuating exchange rates * Sovereign risk the ability of the government of a country to pay off its debts * Natural risk due to the various kinds natural catastrophes, which cannot be controlled There are many other risks which are the following. (1) Strategic Risk (2) Operational Risk (3) Political Risk (4) Country Risk (5) Technological Risk (6) Environmental Risk (7) Economic Risk (8) Financial Risk (9) Terrorism Risk Strategic Risk: The ability of a firm to make a strategic decision in order to respond to the forces that are a source of risk. These forces also impact the competiveness of a firm. Porter defines them as: threat of new entrants in the industry, threat of substitute goods and services, intensity of competition within the industry, bargaining power of suppliers, and bargaining power of consumers. Operational Risk: This is caused by the assets and financial capital that aid in the day-to-day business operations. The breakdown of machineries, supply and demand of the resources and products, shortfall of the goods and services, lack of perfect logistic and inventory will lead to inefficiency of production. By controlling costs, unnecessary waste will be reduced, and the process improvement may enhance the lead-time, reduce variance and contribute to efficiency in globalization. Political Risk: The political actions and instability may make it difficult for companies to operate efficiently in these countries due to negative publicity and impact created by individuals in the top government. A firm cannot effectively operate to its full capacity in order to maximize profit in such an unstable countrys political turbulence. A new and hostile government may replace the friendly one, and hence expropriate foreign assets. Country Risk: The culture or the instability of a country may create risks that may make it difficult for multinational companies to operate safely, effectively, and efficiently. Some of the country risks come from the governments policies, economic conditions, security factors, and political conditions. Solving one of these problems without all of the problems (aggregate) together will not be enough in mitigating the country risk. Technological Risk: Lack of security in electronic transactions, the cost of developing new technology, and the fact that these new technology may fail, and when all of these are coupled with the outdated existing technology, the result may create a dangerous effect in doing business in the international arena. Environmental Risk: Air, water, and environmental pollution may affect the health of the citizens, and lead to public outcry of the citizens. These problems may also lead to damaging the reputation of the companies that do business in that area. Economic Risk: This comes from the inability of a country to meet its financial obligations. The changing of foreign-investment or/and domestic fiscal or monetary policies. The effect of exchange-rate and interest rate make it difficult to conduct international business. Financial Risk: This area is affected by the currency exchange rate, government flexibility in allowing the firms to repatriate profits or funds outside the country. The devaluation and inflation will also impact the firms ability to operate at an efficient capacity and still be stable. Most countries make it difficult for foreign firms to repatriate funds thus forcing these firms to invest its funds at a less optimal level. Sometimes, firms assets are confiscated and that contributes to financial losses. Terrorism Risk: These are attacks that may stem from lack of hope; confidence; differences in culture and religious philosophy, and/or merely hate of companies by citizens of host countries. It leads to potential hostile attitudes, sabotage of foreign companies and/or kidnapping of the employers and employees. Such frustrating situations make it difficult to operate in these countries. CASES * October 2006 International Risk North Korea Future Implications International Risk has drawn up a report which explores the strategic thinking of the North Korean regime and their logic for conducting nuclear tests. The report outlines the likely future implications for Asia. * September 2005 International Risk Assessment: INDIA BUSINESS RISK OPPORTUNITIES India continues to establish itself as an emerging global force attracting increasing foreign direct investment. In response to the ever changing business climate, companies need to develop strategies to increase competitiveness and improve profitability. When expanding into new and developing markets, there are various elements that help make the endeavour successful as well as risks which can lead to severe disappointment. With India being touted as the new market and global player, it is critical that companies understand and appreciate both the opportunities and challenges faced by foreign investors. In short, provided companies take appropriate action to, India works. It represents a huge opportunity for the investor who has the appetite for detail, is patient and looks to the long term. International Risk, the premier international risk mitigation and investigation company, provides a strategic assessment on the risks and opportunities for foreign investors entering this exciting market. * May 2005 International Risk Macau Strategic Risk Assessment In the five years since its return to Chinese sovereignty, the former Portuguese colony of Macau has witnessed unprecedented economic growth, driven by huge investment inflows into its gaming and tourist industries and an explosion in visitor arrivals, particularly from the mainland. Whilst there are positive indications as to Macau continuing its growth as a regional gaming centre, much like its new role model Las Vegas, there are nevertheless uncertainties and risks arising from its chequered past as much as from its future under Beijings current benevolent oversight. Understanding these factors is crucial if foreign investors are to mitigate this risk. International Risk, the premier international risk mitigation and investigation company has developed a strategic review of the challenges facing Macau, the opportunities it presents investors, and the risks they could encounter. International Risk has considerable experience in discreetly assisting foreign investors who seek to enter this colorful, yet exciting environment. * April 2005 International Risk Report on China-Japan  § Political and strategic frictions between China and Japan have been growing over the past few years because of deep-seated historical distrust and an accelerating rivalry for regional power and influence between the two countries. But these tensions were previously contained and offset by close economic ties and the sharing of many issues of mutual interest, such as concerns over the rise of a nuclear North Korea.  § This calm in China-Japan relations has been damaged by a perfect storm of controversies that has unleashed pent-up passions among Chinese city-dwellers across the country. The history text-book issue over Japans war-time activity in China, Japans bid for a permanent UN Security Council seat and Tokyos decision to allocate drilling rights in disputed territorial waters are all highly charged emotional issues that strike at the very heart of Chinese popular nationalism.  § While these controversies have propelled Chinese onto the streets in their thousands, the Chinese leaderships decision to allow these anti-Japanese protests to take place is driven by deeper structural issues that suggest China-Japan ties are likely to remain volatile in the longer term. Managing the Risks of International Trade This guide provides information that will help you to put procedures in place to minimise the risks involved in international trade. You should read it if you are responsible for planning and delivering the export strategy in your company. You should make sure that the information in this briefing is read by your sales and marketing force, your finance management team, your credit manager and the sales ledger controller. What types of risks will I have to manage? Customer Risk You will need an assessment of the credit worthiness of your customer. This should include checking the following: à ¢Ã¢â€š ¬Ã‚ ¢ The identity of your customer. Do they exist as a legally established business in the country of import? Are you dealing with someone who has the authority to bind your customer; à ¢Ã¢â€š ¬Ã‚ ¢ The usual period of credit offered in your customers country; à ¢Ã¢â€š ¬Ã‚ ¢ The credit limit you are prepared to offer your customer; à ¢Ã¢â€š ¬Ã‚ ¢ The trading history of your customer. Are they a prompt payer? Have there been any changes to their normal payment patterns? à ¢Ã¢â€š ¬Ã‚ ¢ Are your exports compatible with your customers normal business profile? à ¢Ã¢â€š ¬Ã‚ ¢ Can your customer pay the bill? à ¢Ã¢â€š ¬Ã‚ ¢ Insolvency. Remember that a customers insolvency can involve you in a pre credit risk, where losses can occur if your customer becomes insolvent during the manufacturing process or at any time before or after the despatch of the export consignment. You can obtain the information needed to carry out these checks either yourself or through a reputable credit agency or credit insurer. Country Risk As well as your customer, their country can pose separate risks that you will need to manage. Country risks traditionally fall into five areas: à ¢Ã¢â€š ¬Ã‚ ¢ Sovereign: The willingness or ability of the government to pay its debts. This is affected by the political climate within the country, internal and external threats to the country; international trading performance including balance of payments record; the level of national debt and the amount of foreign exchange reserves. Other political decisions can also frustrate your export sales; these include the imposition of embargoes, tariff or other quotas, and import or export restrictions. à ¢Ã¢â€š ¬Ã‚ ¢ Private: The ability of the private sector to pay for its imports. This situation is affected by the 2 SITPRO Management Guide: Managing the Risks of International Trade state of the domestic economy, the commercial institutions in the country, and the competence of banking and financial services sector. à ¢Ã¢â€š ¬Ã‚ ¢ Natural: Some regions of the world suffer from regular climactic catastrophes (for example annual flooding, drought, earthquakes and other disasters). When these occur they can severely disrupt the operations of both the business sector and the government. à ¢Ã¢â€š ¬Ã‚ ¢ Fashion and Finance: International trading patterns often create a fashionable region or country as an export market. In these circumstances trade finance is often readily available, allowing you to offer good credit terms to your export customers. However, fashions change and countries can quickly go out of favour for both exports and trade finance. à ¢Ã¢â€š ¬Ã‚ ¢ Other: These include transfer risks such as the inconvertibility of the local currency; transaction risks such as late or non-payment, and transition risks for emerging markets where the threats are the effectiveness of the liberalisation programme, failure to complete economic structural reforms and any possible destabilising influences. You can obtain information about country risks by visiting the country and/or by speaking to other knowledgeable organisations such as UK Trade Investment, your local chamber of commerce or one of the major banks. Credit Risk Perhaps the first question you should ask is Can I afford to give my customers credit? To decide how much credit you are prepared to advance you must consider: à ¢Ã¢â€š ¬Ã‚ ¢ The amount of credit outstanding in your trading accounts, both overseas and domestic; à ¢Ã¢â€š ¬Ã‚ ¢ What do you know about your customer and what is the maximum amount of credit you should NOT exceed; à ¢Ã¢â€š ¬Ã‚ ¢ Can you carry any financial shortfall? What will be the impact on your business if your customer delays payment or does not pay at all? à ¢Ã¢â€š ¬Ã‚ ¢ How will you finance the credit period you offer? This means do you have sufficient money to allow you to offer credit terms in export sales contracts as part of your business cycle. Foreign Exchange Risk When you trade internationally you will most likely be dealing in more than one currency. This means you are exposed to fluctuations in the foreign exchange market. You can learn how to manage this risk by referring SITPROs guide on The Foreign Exchange Market. Other risks If you manufacture goods to order you must include in your export strategy a contingency that will help you manage the risk of a frustrated export this is when your customer refuses the goods. You should have a plan to either resell the product to another market or realise a salvage value for your goods. Managing the Risks of International Trade: You must also have procedures in place for the collection of your invoice amount. Under your contract you may have to collect your money in your customers country. This does have its risks as collection maybe more uncertain or expensive, so you will have to consider the legal system in their country. Your contract may, however, allow you to take legal steps to recover your debt in another country, including your own. How do I manage these risks? You can do the job yourself or employ the services of a comprehensive credit management and insurance provider. If you decide, for sound business reasons, to do the job in house then you must have the resources and knowledge to: à ¢Ã¢â€š ¬Ã‚ ¢ gather credit and other trade information about existing, and potential, customers; à ¢Ã¢â€š ¬Ã‚ ¢ research the country and associated risks; à ¢Ã¢â€š ¬Ã‚ ¢ examine the need for credit insurance, identify the most appropriate policy and investigate competitive products and services; à ¢Ã¢â€š ¬Ã‚ ¢ manage the credit insurance policy and maximise any benefits If you decide to go down this route, you will have to consider the financial and other impacts on your business. These include senior management ownership of the credit management strategy; The allocation of sufficient time, resource and money to do the job, and a review of your export catalogue prices. You must remember to include the costs of in house risk management and extending credit terms in your export quotes. Otherwise, a profit can soon turn into a loss as administrative costs eat into your bottom line. What types of risk management and insurance services are available? Classically, these are the approaches adopted by the business sector, based on the pattern of trade of the exporter. Type of business à ¢Ã¢â€š ¬Ã‚ ¢ Supplying goods to markets and customers on a regular basis; à ¢Ã¢â€š ¬Ã‚ ¢ A large one-off sales contract; à ¢Ã¢â€š ¬Ã‚ ¢ The supply of capital or semi-capital goods for major overseas projects; à ¢Ã¢â€š ¬Ã‚ ¢ The provision of services such as surveys or feasibility studies; à ¢Ã¢â€š ¬Ã‚ ¢ Smaller or new exporters. Products and services Depending on your type of business, the following products and services are available to you: à ¢Ã¢â€š ¬Ã‚ ¢ A partnership with a Credit Insurer to identify and assess your business prospects and cover the risks on your exports. The service can be tailored to meet your needs, by covering all Managing the Risks of International Trade. Your sales ledger, or just your accounts with larger customers, or by having a geographic limit, or by product line, or indeed in many other ways; à ¢Ã¢â€š ¬Ã‚ ¢ A specific insurance policy structured for a particular deal. Such a policy will take into account any factors unique to the sales contract which is being covered. Specific policies are ideal for contracts whose size or duration fall outside the normal pattern of your trade. Also they are suitable for the sale of capital or semi capital goods on extended credit. Insurance for individual contracts can be obtained from credit insurance companies but the main supplier of this service, particularly for capital goods contracts, is the Export Credits Guarantee Department (ECGD); à ¢Ã¢â€š ¬Ã‚ ¢ Smaller or new exporters can use a Managed Credit Insurance scheme as a way of contracting-out the credit control functions (obtaining country information, checking customer details and credit limits, chasing overdue payments and making claims). The cost of these services are often included in the premium for the scheme. Where do I obtain these services? You can approach specialist credit management and insurance providers, or your insurance adviser (broker, agent or intermediary). A list of credit insurance companies can be obtained from Association of British Insurers. Details of specialist advisers can be obtained from organisations such as the British Insurance Brokers Association. With their worldwide networks credit insurance companies have years of experience and expertise in analysing and covering the risks involved in international trade. In addition to covering commercial debts and indemnifying you if your customer fails to pay, they can provide you with guaranteed cover which could improve your cash-flow, provide confidence to maximize your export sales and may enhance your borrowing power. The use of credit insurance imposes on your company a disciplined and professional approach to trade risk management. Adopting this solution can help reduce your bad debts, improve your competitiveness in the global marketplace and increase your profitability. Are there any other options open to me? There are other financial solutions to you credit management risks: à ¢Ã¢â€š ¬Ã‚ ¢ do nothing, and carry the risk yourself. The extent of the risk you are prepared to take will determine if this option is appropriate; à ¢Ã¢â€š ¬Ã‚ ¢ Factoring or invoice discounting; à ¢Ã¢â€š ¬Ã‚ ¢ Forfaiting.; à ¢Ã¢â€š ¬Ã‚ ¢ Secured payment terms (for example, Letters of Credit); à ¢Ã¢â€š ¬Ã‚ ¢ Insurance-backed financial packages. Managing the Risks of International Trade How much will it cost me? Like all insurance cover (premises, employers liability, business interruption) you will have to pay for your risk management and insurance services. Policies based on a specific risk are available and premium is usually on a one-off basis. Premium is calculated according to the specific risk in question, credit period offered, your customers country and the duration of the risk from the insurers perspective. There are also credit insurance policies and managed schemes that will cover all of your export turnover. Premium is usually annual and assessed against your estimated insurable turnover (the sales on credit covered). With your credit insurer you will have to agree your target export turnover for any one year. Typically, you can expect to pay between 0.35% and 0.65% for this type of policy, dependent on your products, the number of customers and range of your export markets, your export trading experience, and your own credit management system. As with all insurance cover, you should spend time researching the market and getting quotes from a range of credit insurance providers. The costs quoted are based on typical policies available for small or new exporters wishing to cover sales with fairly short delivery and payment profiles. Costs will rise for specific policies where the horizon of risk for the insurer might be 2 or 3 years as in the case of ECGD cover for capital goods projects. Conclusion Credit insurance is an important risk management tool to help you protect the payment of your overseas accounts and unlock the full potential of your export business. You should carefully consider including it in your global trading strategy. What are the major risks for business? 1. Political risk 2. Economic risk 3. Financial risk What is the risk in the following Countries..? INDIA : In India or country risk tier (CRT) is categories in three types of risks. Political, economical financial risks. * Poverty reduction in India is heavily reliant upon high levels of economic growth, which is likely to return in 2010/11. Political Risk: High à ¢Ã¢â€š ¬Ã‚ ¢ Income disparity in India is significant, as approximately one third of the population lives in poverty. à ¢Ã¢â€š ¬Ã‚ ¢ National security has become a focus in India as some of the major cities have been the scene of terrorist bombings. à ¢Ã¢â€š ¬Ã‚ ¢ The bilateral relationship with Pakistan is strained, and receives worldwide attention. Efforts in recent years to make reparations have been interrupted repeatedly by acts of violence. Financial System Risk: Moderate à ¢Ã¢â€š ¬Ã‚ ¢ The insurance industry is regulated by the Insurance Regulatory and Development Authority (IRDA). à ¢Ã¢â€š ¬Ã‚ ¢ The Indian government is working to align its regulatory and accounting standards with international best practices. à ¢Ã¢â€š ¬Ã‚ ¢ The Indian financial system has fared relatively well during the global financial crisis. Economic Risk: Moderate à ¢Ã¢â€š ¬Ã‚ ¢ India, with a massive population exceeding one billion, is home to the worlds 12th largest economy as measured by gross domestic product (GDP). à ¢Ã¢â€š ¬Ã‚ ¢ Indias information technology sector and business services sector have been drivers of growth as the government has supported development with improvements in infrastructure and regulation. à ¢Ã¢â€š ¬Ã‚ ¢ A notable point of weakness for the Indian economy is the worsening government budget balance. The deficit will likely reach -7.0% of GDP in 2008/09. CANADA: Economic Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ Canadas economy is developed, with services and manufacturing accounting for the majority of the countrys output. à ¢Ã¢â€š ¬Ã‚ ¢ International trade is vital to the economy as exports represent about 40% of GDP with nearly 80% of those exports going to the United States. à ¢Ã¢â€š ¬Ã‚ ¢ Economic growth in Canada began to contract in the fourth quarter of 2008 and will continue to contract until 2010. Political Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ Canada is a high income country with significant natural resources and an established legal system. à ¢Ã¢â€š ¬Ã‚ ¢ Canadas economy is inexorably linked to that of the United States due to the latter countrys geographic proximity, cultural similarities and economic size. à ¢Ã¢â€š ¬Ã‚ ¢ Canadas budget has moved into deficit as the government uses fiscalpolicy to help stimulate the economy. Financial System Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ Insurance companies in Canada can be licensed at a national and/or provincial level. à ¢Ã¢â€š ¬Ã‚ ¢ Federal companies are registered under the Insurance Companies Act of Canada and are regulated by the Office of the Superintendent of Financial Institutions of Canada. USA: Economic Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ The United States economy is the largest and most advanced in the world with gross domestic product (GDP) of more than USD 14 trillion. à ¢Ã¢â€š ¬Ã‚ ¢ The United States has the dual advantage of being rich in natural resources, both agricultural and mineral, but also capable of producing high-end products such as computers and peripherals, medical equipment, pharmaceutical products and military equipment. à ¢Ã¢â€š ¬Ã‚ ¢ The U.S. economy is currently experiencing its worst economic contraction since at least the early 1980s with unemployment expected to reach double digits and GDP reaching negative 3% in 2009. Political Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ The United States has a stable democratic political system and a strong legal system. à ¢Ã¢â€š ¬Ã‚ ¢ The United States is currently involved in armed combat in Iraq and Afghanistan which has put strain on the relationships between the U.S. and much of the international community. à ¢Ã¢â€š ¬Ã‚ ¢ The U.S. is currently using expansionary fiscal policy to stimulate the economy and this has led to a substantial increase in the budget deficit. Financial System Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ Insurance regulation in the United States is decentralized and handled on a state by state basis. à ¢Ã¢â€š ¬Ã‚ ¢ The financial system in the U.S. is going through a tumultuous period with the government intervention with large corporations such as Bear Stearns, Citigroup and AIG. UK: Economic Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ The United Kingdom (UK) has the second largest economy in Europe behind Germany. Service industries represent three quarters of economic production, particularly financial services and real estate activities. London is a global financial center and businesses there account for nearly half of the countrys financial services industry. à ¢Ã¢â€š ¬Ã‚ ¢ The UK economy entered into a recession in the second half of 2008 as the country has been hit hard by the financial crisis and a declining housing market. The economy is not expected to recover until mid to late 2010 at the earliest. Political Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ The United Kingdom is a member of the European Union. However, the United Kingdom, along with Denmark, obtained special opt-outs from the Maastricht Treaty which allows them to not adopt the euro unless they wish. à ¢Ã¢â€š ¬Ã‚ ¢ The UK government has taken steps to counteract the effects of the current financial crisis. These steps include partial nationalization of the banking system and implementing several stimulus packages. Financial System Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ The Financial Services Authority (FSA) regulates the UK financial services industries, including insurance. à ¢Ã¢â€š ¬Ã‚ ¢ The UK is widely seen as a major center for international insurance and reinsurance and is home to the London Market, a wholesale market that writes risk around the world. Lloyds of London accounts for over half of the business on the London Market. JAPAN: Economic Risk: Low à ¢Ã¢â€š ¬Ã‚ ¢ Japan, an industrialized and advanced country, is home to the second largest economy in the world behind that of the United States. à ¢Ã¢â€š ¬Ã‚ ¢ Gross domestic product (GDP) growth, which had been weak over the past 20 years, will fall sharply in 2009 as domestic demand and exports contract. The government is responding to the crisis with aggressive expansionary fiscal policies that should result in a return to modest growth in 2010. à ¢Ã¢â€š ¬Ã‚ ¢ Inflation, however, is expected to remain negative until 2011.