Qualitative Characteristics of Financial Information

Qualitative Characteristics of Financial Information The purpose of financial statements is to give financial statements information about the change in financial position, financial performance and financial position of the organization. These can provide data use in decision making such as investment, credit and economic decision making which are useful for various users. There are seven main groups of users which are public, investors, lenders, employees, customers, supplies, government and other agencies and the needs of information is different for each group, for instance, employee will interest on the profitability, retirement benefits and employment opportunities and so on. Financial statement is supposed to relevant, reliable, understandable and comparable. In addition, financial statement may include other information, for example, the uncertainties and risks that influence the organization. Evaluation of the relevance, reliability, comparability and understandability Relevance is about the information that has the ability to influence the economic decisions of users. There are two main points relate to the relevance which are predictive value and confirmatory value. Predictive value can help users to measure the past, present or future performance. Confirmatory value can help users to confirm their past evaluations. The annual reports include ten-year statistics which have the recent ten-year figures. It includes profit and loss account, balance sheet and passenger services figures and so on. It can help the shareholders to confirm the past evaluations, measure the past performance and compare the relevance information at the same time. The annual reports embody a part of operating network with future extensions. In this part, the report has stated all properties that they are developing, constructing, planning and the properties that owned, developed and managed by them. It can help us to predict the present and future performance and verify the past evaluations. In the annual reports, we can find the CEOs review of operations and outlook. This part is the MTRs CEO taking about the MTR past performance which is good and which is bad, it also mentions the next year development of the MTR. It gives us a clear mind about the MTR what will do during the next year and briefly review the previous year performance. Reliability is about the information that is a complete and true representation. There are five major issues involve in reliability, free from material error, a faithful representation, neutral, prudent and complete. MTR use one of the big 4 accounting company that is KPMG. KPMG is a large international company and has a lot of auditing experience and professional staff. Therefore, shareholder can have a great confidence on the financial statements. On the other hand, the audit report state that the KPMG give a true and fair view that means the MTR reports are properly prepared with accounting standards which means the reports are free from material, faithful representation, prudence and complete. Also, the accounting firm is an independent audit firm which can fulfill the point of neutral. As a shareholder, we can have a great confidence on that reports, because it is accuracy and do not have any creative account. MTR is a public organization and it is managed by government. It has been required a high transparency that disclosure all information to public, such as, company policies, therefore, their information must be faithful, neutral, prudent and complete which are required by law. So, their information has a high reliability. From the view of shareholders, we can trust on it. The MTR have an internal audit team which is responsible for the internal control, project review, fraud investigation, due diligence and management review and so forth. It can help the MTR to give us a report that is reliable, free from material error, faithful, neutral, prudent. As a shareholder, we can have great confidence on the annual reports. Comparability is about the similarities and differences can be discerned and evaluated. There are two key matters include in the comparability which are consistency and disclosure. Inside the annual reports, we can find many figures that can give us to compare. Such as the Ten-Year Statistics, it includes ten years data for us to realize. We can see that the earnings per share are increased steadily each year from $0.81 per share in 2000 to $1.69 per share in 2009. Also, the profit is increased rapidly from $7,758 on 2006 to $15,182 on 2007. In addition, in the CEOs Review of Operations and Outlook part, it compare a lot of data, for example, the Average weekday patronage for the Domestic Service in 2009 was 3.5 million, which represents an increase of 0.9% over 2008 and the total revenue from property rental, property management and other businesses in 2009 was HK$2,928 million, an increase of 8.0% over 2008. Moreover, the financial statements have provided two years figures for us to compare which is 2008 and 2009. For instance, the Loans, other obligations and bank overdrafts is decrease significantly from $31,289 in 2008 to $23,868 in 2009 which decline 23.7%. The dividend per share is increase from 0.48 in 2008 to 0.52 in 2009 which increase 8.3%. From the figure that we have analysis above, we can see that the MTR profit is increase each year and the loan decrease each year, therefore, it is a signal for us continue to keep the share or investment more. Understandability is about the significance of the information can be perceived. There are two important points contain in the understandability, users abilities and aggregation and classification. Inside the annual reports, it contains a glossary part. In the glossary, it explains a particular domain of knowledge that uncommon, specialized or newly introduced. For example, operating margin means operating profit from railway and related businesses before depreciation and amortization as a percentage of the turnover and ordinary shares means ordinary shares of HK$1.00 each in the capital of the company and so forth. As a shareholder, it helps a lot during reading the annual reports, because not every shareholder also has that much professional knowledge. The annual report contains many picture, table and chart. An annual report is very thick, because it contains large information about the MTR performance. From the view of shareholder, if the reports are full text, it is hard for us to read it all, because it has a lot of words to read and understand. When reading the annual reports, it is not hard to find pictures, tables and charts, it can help us more easily to realize the information, especially the tables and charts, it convert the figures into a understandability form so that the readers can catch the main point easily. It also includes a content page and classifies similar data to similar group. When we look at content pages, it not only states the title but also state the number page which makes the shareholders more convenience to find the information what they need. This annual reports have different language version which can take care of different users, although this MTR is a Hong Kong organization, as a shareholders, I may be a foreigner and I can not read any Chinese words. Therefore, different language version is important as well. It is easy to find that the MTR annual reports have been prepared by two versions which are Chinese and English. Which one of the four qualitative characteristics of financial information is the most important? In my opinion, the reliability is the most important qualitative characteristic. If the financial statements are not reliable, the shareholders will not have any confidence on the MTR reports, because they feel that the financial statement information of the MTR is not faithfulness and truthfulness. Hence, they will not have any interest to realize the MTR reports, so that the objective of financial statement is invalid. Even though the annual reports has higher quality of relevance, comparability and understandability, but without reliability which will cause the shareholders and potential investors run away. In the opposite side, if the financial statements have a higher degree of reliability, the shareholders will have more confidence on the annual reports, because higher degree of reliability means the annual repot have meet the requirements of free from material error, a faithful representation, neutral, prudent and complete. When the reports meet those requirements, it attracts the shareholders stay and attracts more investors. When seeing the MTR annual reports, we can know that their reports have a good reliability. The MTR employ an external accounting firm which is KPMG to audit their accounting information, it fulfill the point of neutral. The audit firm also give a true and fair view to the MTR which means their information are faithful, complete, prudent and free form material error. From the above discussion, we can see that reliability is the most important qualitative characteristics in the financial statement. Conclusion During analysis the MTR annual reports, I know that the four qualitative characteristics have a great influence to shareholders. It has a significant impact on the decision making, because it can help them to understand, realize and build up the confidence on the MTR reports. The four qualitative characteristics also affect the shareholders invest or not. In my opinion, the reliability is the most important qualitative characteristic, it represents faithfulness and truthfulness. Shareholder will depend on it to decide whether those accounting information can trust or not, thereby to planning the investment decision. Word Count: 1553 words

Corporal Punishment :: essays research papers

Corporal Punishment People a few years ago,thought of the only way to punish someone who did a sinister deed was to use corporal punishment.This is meant to enforce pain to someone who has done wrong by hitting them,beating them,strapping them or even whipping them.These are only a few examples of corporal punishment. Why do we have corporal punishment,How do we benefit from it and how do we abuse it?. The most obvious reason for corporal punishment is to castigate one for doing wrong by means of physical abuse expecting the individual to learn from his or her mistake.But we must ask ourselves this question.Is the person benefiting from this or is he or she not only being physically abused but mentally.In some cases corporal punishment psychologically effects ones mind on a long term bases that will stain their memory for a very long period of time. In other cases physical punishment scars and stains the body changing its physical appearance but only on a small scale.Corporal punishment is also used because it is quick and in most cases effective.The mental condition of the person being affected may worsen not only resulting to utter madness but may also result in lack of moral strength.Most people nowadays feel that corporal punishment is not the best answer to enforce restrictions in society as they feel,that pain is not the best solution. Although Corporal punishment has its disadvantages it can also make people aware of the fact that wrong doing results in pain and agony.As more people know the effect of misbehaving,the fewer the mistakes there would be.Michael Fae for example, used a paint canister to spray paint on cars for fun.The result for this action was to be strapped four times on the back.Now he realizes what he has to face if he were to do it again. In the past,corporal punishment was used very often especially in schools.Now corporal punishment is banned from most of the schools around the world because a lot of the people who administer it abuse it.

Should There Be Private Universities

rivate universities in India – why? how? Why do we need private universities? Higher education in India has largely been the preserve of the Government till recently in terms of both funding and provision of education. But for this to continue, the Government should continue to be in a position to pour in large sums of money to fund higher education. Today, the Government is unable to find the funds even to keep up its own commitment of spending 6% of GDP on education.There is also a clamour to spend more of what little funding the Government has allocated for education, on primary education than on higher education, and quite rightly so, given that many children don't even get a basic primary and secondary education today. Thus the Government spending on higher education as a percentage of overall government spending on education is only likely to decrease further in the coming years. But the demand for higher education is continuing to increase with more and more students wa nting a higher education today than ever before.How can we bridge the gap between increasing demand and decreasing government funding for higher education? The only option is to tap the private sector to participate in the funding and provision of higher education. The process of increasing private participation in higher education has already begun with a few states like Chhattisgarh and Uttaranchal having passed legislation to permit the setting up of private universities in their states.Indeed the private sector has been funding higher education in India for a long time, albeit on a very limited scale. The Birla Institute of Technology and Science at Pilani in Rajasthan, which is funded and run by the Birla Group Trust, became an officially recognised university as far back as 1964. Other institutions like the Manipal Group in Manipal in Karnataka have been running private colleges since 1953 and the Manipal Academy of Higher Education became a deemed university in 1993.Many othe r self-financing colleges were set up in the early 1990s and a few of them have now become deemed universities. Problems arising out of poor regulation of private universities After the passing of legislation in Chhattisgarh in 2002 (and subsequently in other states like Uttaranchal), to facilitate the establishment of private Universities with a view to creating supplementary resources to assist the State Government in providing quality higher education, there was a spate of private universities that were set up under the Chhattisgarh Act.The Chhattisgarh legislation was passed in a hurry without much care, leaving many loopholes in the Act, which were quickly exploited by many organisations that set up private universities, without a serious commitment to higher education. Many of the private universities set up under the Chhattisgarh Act did not have either the infrastructure, or a campus, or the funds to provide quality higher education, and functioned out of one-room tenements. The Chhattisgarh Act did not provide for proper regulation and maintenance of standards by these universities and moreover, the Chhattisgarh Government did little to ensure that the private universities did what they were expected to do according to the legislation. Students who signed up for courses offered by private universities set up under the Chhattisgarh Act were being taken for a ride by many private universities who had no capability to offer quality courses.Prof. Yashpal, former chairman of the University Grants Commission, petitioned the Supreme Court in 2004 to declare the Chhattisgarh legislation unconstitutional and the Supreme Court after due deliberation concurred and declared in February 2005 that all the private universities set up under the Chhattisgarh Act were illegal, putting the careers of all the students who enrolled in the institutions set up by the private universities in jeopardy.But to protect the interests of the students, the Supreme Court directed the Chhattisgarh Government to take appropriate steps to have such institutions affiliated to the already existing State Universities in Chhattisgarh. It is important to note that the Supreme Court did not state that all private universities are illegal – it has only stated that the manner in which the Chhattisgarh legislation allowed the setting up of private universities was illegal. The problem is not with private participation in higher education, but with the poorly drafted Chhattisgarh legislation and the lack of proper egulation. Given the Government's lack of funds for higher education and the increasing demand for higher education, we simply cannot do without private universities. We have no option but to tap private funding for higher education. The task before us now is to come up with ways and means to ensure that private universities are properly regulated, yet autonomous and independent enough to flourish, and held to high standards to provide quality higher educat ion. How can we ensure private universities are held to high standards? We can borrow the model from the corporate sector.Just as all companies are required by law to publish annual reports providing details of their assets, liabilities, profits and losses, the profiles of the board of directors and the management and various other financial information, every educational institution (whether public or private) should publish an annual report with details of the infrastructure and facilities available, profiles of the trustees and the administrators, the academic qualifications and experience of the staff, the courses offered, the number of students, the results of the examinations, the amount of funds available to the university and the sources of funding etc.In addition, every educational institution must get itself rated by an independent rating agency like CRISIL, ICRA or CARE and publicly announce its rating to prospective students to enable the students to choose the instituti on they want to enroll in. At one stroke, this will bring in transparency and ensure that every educational institution, whether public or private, is accountable not only to those students who are studying in the institution, but to prospective students and the public at large as well.Public announcements of the financial and educational records of the institutions as well as their ratings by independent rating agencies will generate healthy competition between the various private institutions and will also put pressure on the Government funded institutions to work towards all-round improvement. Such a system is already in place for maritime education in India. In 2004, the Directorate General of Shipping (DGS), which regulates maritime education in India, introduced a system of rating maritime training institutions in India.In 1996, maritime education was opened to private sector participation and over 130 private institutions are in operation today. To ensure that all institution s provide high quality education, the DGS has asked all maritime educational institutions to get themselves rated by one of the three reputed independent rating agencies in India – CRISIL, CARE or ICRA. The publicly announced ratings will benefit he students, in deciding which institution to enroll in, the institutes, in differentiating themselves based on their quality, the employers, in assessing the quality of students graduating from the institutes and the DGS as well, to non-intrusively regulate the maritime education sector and ensure high quality of education. Maritime education institutes, both public and private, are now getting themselves rated by independent rating agencies and the DGS lists the ratings on its web site. Introducing a similar model across all other sectors of higher education including engineering, medicine, arts, sciences etc. ill ensure that only those institutions with better facilities, staff and infrastructure and reputations will thrive. This will go a long way in ensuring the provision of quality higher education not only in the private sector, but in the public sector as well. The Centre and the States should pass legislation to make it mandatory for all higher education institutions to publish a detailed annual report of their financial and educational status and also be rated by independent rating agencies and publicly announce their ratings.

Commonly Confused Word Pairs in English

Here, from our Glossary of Commonly Confused Words, are 20 tricky word pairs that look and sound alike but have different meanings. (For examples and practice exercises, click on the highlighted words.) Advice and AdviseThe noun advice means guidance. The verb advise means to recommend or counsel.All Together and AltogetherThe phrase all together refers to people or things gathered in one place. The adverb altogether means entirely or wholly.Baited and BatedA hook, witness, or animal is baited (lured, enticed, tempted). Breath is bated (moderated).Cite and SiteThe verb cite means to mention or quote as an authority or example. The noun site means a particular place.Complement and Compliment; Complementary and ComplimentaryComplement means something that completes or brings to perfection. A compliment is an expression of praise.Discreet and DiscreteThe adjective discreet means tactful or prudent self-restraint. Discrete means distinct or separate.Eminent and ImminentThe adjective eminent means prominent or outstanding. Imminent means impending, about to occur.Flair and FlareThe noun flair means a talent or a distinctive quality or style. As a noun, flare means a fire or a blazing lig ht. Similarly, the verb flare means to burn with an unsteady flame or shine with a sudden light. Violence, troubles, tempers, and nostrils can flare.Formally and FormerlyThe adverb formally means in a formal way. The adverb formerly means at an earlier time.Hardy and HeartyThe adjective hardy (related to hard) means daring, courageous, and capable of surviving difficult conditions. The adjective hearty (related to heart) means showing warm and heartfelt affection or providing abundant nourishment.Ingenious and IngenuousThe adjective ingenious means extremely clever--marked by inventive skill and imagination. Ingenuous means straightforward, candid, without guile.Lightening and LightningThe noun lightening means making lighter in weight or changing to a lighter or brighter color. Lightning is the flash of light that accompanies thunder.Mantel and MantleThe noun mantel refers to a shelf above a fireplace. The noun mantle refers to a cloak or (usually figuratively) to royal robes of st ate as a symbol of authority or responsibility.Moot and MuteThe adjective moot refers to something that is debatable or of no practical importance. The adjective mute means unspoken or unable to speak.Prescribe and ProscribeThe verb prescribe means to establish, direct, or lay down as a rule. The verb proscribe means to ban, forbid, or condemn.Rational and RationaleThe adjective rational means having or exercising the ability to reason. The noun rationale refers to an explanation or basic reason.Shear and SheerThe verb shear means to cut or clip. Likewise, the noun shear refers to the act, process, or fact of cutting or clipping. The adjective sheer means fine, transparent, or complete. As an adverb, sheer means completely or altogether.Stationary and StationeryThe adjective stationary means remaining in one place. The noun stationery refers to writing materials. (Try associating the er in stationery with the er in letter and paper.)Track and TractAs a noun, track refers to a path, route, or course. The verb track means to travel, pursue, or follow. The noun tract refers to an expanse of land or water, a system of organs and tissues in the body, or a pamphlet containing a declaration or appeal.Whose and WhosWhose is the possessive form of who. Whos is the contraction of who is.