Financial Company Managers - Free Essay Example

Sample details Pages: 7 Words: 1974 Downloads: 9 Date added: 2017/06/26 Category Finance Essay Type Argumentative essay Did you like this example? Recent financial scandals associated to accounting and other frauds allegedly blamed to top company managers (e.g. Enron, Worldcom, Adelphia, MS, June 2 2005 17:12 Last updated: June 2 2005 17:12) have brought into public light the recurring question of whether companies are managed on the best interests of shareholders and other company stakeholders such as workers, creditors and the general community. A point that has been made frequently is that top managers may possess too much power inside their companies and that a general lack of accountability and control of their activities is prevalent in companies with wide ownership diffusion. Although this kind of scandals is certainly not new, there has been a renewed interest on the mechanisms that can effectively curtail managerial discretion over sensitive company issues that can have an impact on the welfare of the remaining stakeholders. Don’t waste time! Our writers will create an original "Financial Company Managers" essay for you Create order At the same, time, and especially after some well publicised company failures in the late 80s early 90s (Polly Peck, Coloroll, Maxwell Communications, BCCI), numerous sets of recommendations on corporate governance issues have been published worldwide and adopted, in particular, by many stock market regulators since the seminal Cadbury (1992) report in the UK. This has given place to a considerable amount of research on the effectiveness of these recommendations in providing better company governance. This paper attempts to provide a survey on the fast-growing theoretical and empirical literature on the corporate governance problem, providing some guidance on the major points of consensus and dissent among researchers regarding the nature and effects of the conflicts of interest between managers and other stakeholders, and on the effectiveness of the set of available external and internal disciplining mechanisms. This paper will also attempt to compare code of best practices companies in United States and United Kingdom. A particular emphasis will be given to the special conflicts arising from the relationship between managers and shareholders in companies with large ownership diffusion. Definitions Corporate governance is about promoting corporate fairness, transparency and accountability J. Wolfensohn, president of the Word bank, as quoted by an article in Financial Times, June 21, 1999 Corporate governance deals with the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment, The Journal of Finance, Shleifer and Vishny [1997, page 737]. Corporate governance which can be defined narrowly as the relationship of a company to its shareholders or, more broadly, as its relationship to society, from an article in Financial Times [1997]. Corporate governance is a field in economics that investigates how to secure/motivate efficient management of corporations by the use of incentive mechanisms, such as contracts, organizational designs and legislation. This is often limited to the question of improving financial performance, for example, how the corporate owners can secure/motivate that the corporate managers will deliver a competitive rate of return, www.encycogov.com, Mathiesen [2002]. Some commentators take too narrow a view, and say it (corporate governance) is the fancy term for the way in which directors and auditors handle their responsibilities towards shareholders. Others use the expression as if it were synonymous with shareholder democracy. Corporate governance is a topic recently conceived, as yet ill-defined, and consequently blurred at the edgescorporate governance as a subject, as an objective, or as a regime to be followed for the good of shareholders, employees, customers, bankers and indeed for the reputation and standing of our nation and its economy Maw et al. [1994, page 1]. Literature Review Since Adam Smiths (1776) pessimistic view of publicly traded corporation much research has been performed in the field of corporate governance. Different researchers have studied the corporate governance from different perspectives. However, the direction for the traditional research of corporate governance was set up by Berle and Means (1932), when they presented a theory to separate ownership from control. Through the 1970s and 1980s research of corporate governance largely focused on the governance of USA corporations, and that research continues to expand. By the early 1990s research on governance in countries other than US began to emerge. First research focused primarily on other major world economies Japan, Germany, and United Kingdom, but later corporate governance research has emerged around the world, for both developed and emerging markets. According to Sleifer and Vishny (1996) corporate governance deals with the ways investors assure to get a return on their investment. In many countries, like in United States, Germany, Japan and United Kingdom, corporate governance systems are well developed. In those countries companies are governed through different combinations of legal protection and concentrated ownership. However, many countries like transition economies, corporate governance have no tradition and corporate governance mechanisms have far been practically non-existent. Although in many countries corporate governance is considered well developed, still there are great differences in governance tradition between these countries. According to Easterbrook (2005), international differences in corporate governance are attributable more to differences in markets than to differences in law. In Europe United Kingdom and Germany represent two different tradition of corporate governance and also two different traditions. In most of Continental Europe, with the exception of the UK, hostile takeovers are, However, rare. Franks and Mayer (1994) attribute this fact to the particular structure of most European capital markets, characterised by a small number of listed companies and a relatively high concentration of ownership as compared to the US and UK. In their analysis of UK takeovers, Franks and Harris (1989) report shareholder wealth impacts of takeovers similar to those observed in the US. Kennedy and Limmack (1996) analyse the performance of takeover targets in the pre-takeover period and its relationship with subsequent CEO turnover and find evidence consistent with takeovers acting in the UK as disciplinary mechanisms on managers. They observe that CEO turnover tends to increase following takeovers, and that target firms that do replace CEOs after takeovers (disciplinary takeovers) experience lower returns before takeover than other targets. In contrast, Franks and Mayer (1996) reject the hypothesis that in the UK hostile takeovers perform a disciplining function. They assert that the apparent rejection of hostile bids by target management seems to be derived not from managerial entrenchment but from opposition to post-takeover redeployment of assets or renegotiation over bid terms. In another UK study, Sudarsanam, Holl and Salami (1996) present the result that a better previous relative performance of bidder over target (measured by their relative market-to-book ratio) is a significantly positive influence on targets abnormal returns surrounding a takeover inefficient. The same absence of those transactions would occur if the takeover threat were a perfect controlling mechanism which forced all managers to behave in a value-maximising way.19 bid announcement but a negative one bidders returns. This result is not strictly in accordance with a disciplinary perspective of takeovers where value enhancements would be expected to occur for both targets and bidders. Sudarsanam, Holl and Salami (1996) interpret their evidence, instead, as consistent with Rolls (1986) hypothesis that bidder managers may suffer from hubris that leads them to overestimate the benefits of a takeover and pay excessive takeover premia. The UK evidence on the disciplinary role of takeovers thus appears to be, in contrast to US studies, inconclusive. Codes within United Kingdom and the United States of America These codes, issued by a variety of governmental, investor representative, and/or professional bodies have been a precedent for helping shape modern day corporate governance, both in the U.S. as well as in the U.K. (Mallin, 2004). Starting in 1987, the U.S based National Commission on Fraudulent Financial Reporting, also known as the Treadway Commission, has helped provide a benchmark for the role and importance of the audit committee. In the subsequent year, the Securities and Exchange Commission (SEC) ruled that all SEC-regulated companies should have an audit committee with a majority of non-executive directors in the hope that hiring an external, non-company employee, would provide a true and fair view of the corporations financial position (The Combined Code: towards a risk management culture, 2002). In addition, the 1992 Committee of Sponsoring Organizations of the Treadway Commission (COSO) established a framework on public reporting and management of internal control systems (The Combined Code: towards a risk management culture, 2002). In the same year as the COSO, the 1992 Cadbury Report paved the way for major corporate governance reform in the U.K., especially at a time when corporate scandal, was rife (with the Polly Peck, BCCI, and Guinness fraud cases). The Cadbury Report outlined a host of recommendations which were targeted towards the board of directors, non-executive and executive directors, as well as those involved with the reporting and control of the Corporation. It also addressed many of the problems that may be associated with the separation of the ownership and control of corporations and suggested that the roles of the Chairman and Chief Executives should be split (Mallin, 2004). As a result, not only did the Cadbury Report establish structure and accountability for a corporations actions, it also proved to be a global example of the implementation of corporate governance. As corporations developed, apprehension over exorbitant directors remuneration packages and the inconsistent and incomplete disclosure in companies annual reports increased, resulting in the formation of the Greenbury Committee in 1995 (Mallin, 2004). The committee further strengthened the Cadbury Reports need for corporate accountability by recommending the formation of a remuneration committee comprised of independent non-executive directors who would report fully to the shareholders the amount of money that was paid to each director as well as the corporations policies on such payments (Mallin, 2004). Also, a performance based rewards system was recommended in order to lessen agency costs and improve efficiency. The ever-changing financial world results in a constant pressure to adapt previous codes to the present-day markets. As a result, such needed updates saw the formation of the Hampel Report and the Combined Code, both presented in 1998. The former of these two, tried to combine the previous codes in order to form a new code of best practice for corporations, and focused mainly on shareholders and auditors, as well as the role of stakeholders within the corporations ethos. The committee concluded that the directors as a board are responsible for relations with stakeholders but are accountable [more so] to the shareholder (Hampel Report, 1998). The latter requested that companies should be ready to explain their governance policies, including any circumstances justifying departure from best practice; and that those concerned with the evaluation of governance should do so with common sense, with due regard to companies individual circumstances (Combined Code, 1998). Methodology Given the focus of my interest, the research philosophy I will adopt is Interpretive, as it asserts the uniqueness of organisations and the complexity of best practice situations that influence individuals in their understanding of their environment. Indeed, I aim to explore the relationships of different groups of individuals i.e. the entire management and control of the company, including its organizational structure, business policy principles, guidelines, and internal and external regulation and monitoring mechanisms, and the resulting perceptions of a phenomenon i.e. Corporate Governance the code of best practice. The inductive reasoning approach is the most appropriate to my research as I aim to gain an in-depth understanding of the meanings individuals (e.g. stakeholders) attach to situations. Besides, I have the opportunity to explore closely the various dimensions of the research context (i.e. Plcs). Data collection Due to the confidentiality problem the research will be based on secondary data. As its hard to get primary data direct from the companies.The preliminary company level data will be collected from annual report of quoted company. Later more data will collect from public sources (e.g. financial reports, internet and other sources) and corporate governance report of the companies, reports from remuneration committee, and reports of internal and external audit committee. Gathered data will be analyzed both with quantitative and qualititative methods.

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Transcoding Jpeg Free Essays

Melvin Berena BTC640 February 1, 2012 Abstract There is a transcoding scheme that proposed to compresses existing JPEG files without losing the quality. It does it by using the H. 264-like block-adaptive intra prediction to use inter-block relationship of quantized DCT coefficients that are stored in the JPEG file. We will write a custom essay sample on Transcoding Jpeg or any similar topic only for you Order Now This prediction is performed in spatial domain of each block composed of 8? 8 pels, but the corresponding prediction residuals are calculated in DCT domain to ensure lossless reconstruction of the original coef? cients. Block-based classification is carried out to allow accurate modeling of PDF’s. A multi-symbol arithmetic coder and the PDF model is used for entropy coding to predicting residual of each DCT coefficient located in the in JPEG files. For monochrome JPEG images end result usually shows the reduction of coding rates about 18 – 28 %. Transcoding [Scheme] Scheme is a digital-to-digital data conversion method of converting to another type/format, like movie or audio files. This is frequently done when a particular target device does not support the file format or has limited storage capacity that requires a reduced file size. This is also done to convert incompatible or out dated data to a better and modern format. One good advantage of transcoding is to reduce storage cost. Example, Cineon and DPX are widely used as a standard movie format but it cost a lot of space (2hour movie = about 8 terabytes). It would be demand more storage and processing power to handle this this kind of file format. However, transcoding into a JPEG2000 lossless format has better compression performance than other lossless coding technologies. The Challenge The number one challenge I faced was when I approached this academic paper review and read the abstract. I did not understand a lot of information printed in this paper but as I kept reading the whole article I started getting a basic idea of what the paper is talking about. I took me a lot of time to just read the Abstract as I was using the search engine (Google) to understand every other word. The second problem I faced was when I approached the Spatial Domain, I still don’t completely understand that concept but I get the basic understanding how the object ends up with the blurriness effect as the object enters a repetitive intensity variation. References Academic Paper review: http://zenit. senecac. on. ca/wiki/imgs/Lossless_re-enconfig_of_jpeg_images. pdf Websites: http://en. wikipedia. org/wiki/JPEG#Block_splitting http://en. wikipedia. org/wiki/Transcoding http://en. wikipedia. org/wiki/Point_spread_function http://en. wikipedia. org/wiki/Discrete_cosine_transform http://www. eurasip. org/Proceedings/Eusipco/Eusipco2011/papers/1569428105. pdf (Coding rates) http://en. wikipedia. org/wiki/Entropy_encoding http://research. microsoft. com/en-us/people/fengwu/screen_icme_06. pdf (Block-based Classification) How to cite Transcoding Jpeg, Papers