Financial Institutions Essay Example

Financial Institutions Essay International Technological University FINN 918 Financial Institutions Final Exam: Answers Textbook:  Foundations of Financial Markets and Institutions, 4th Edition, Fabozzi, Modigliani, and Jones, Prentice Hall, 2010,| ISBN –13: 978-0-13613531-9| ISBN –10: 0-13-613531-5| 1. Indicate whether each of the following instruments trades in the money market or the capital market: a. General Motors Acceptance Corporation issues a financial instrument with four months to maturity. b. The U. S. Treasury issues a security with 10 years to maturity. c. Microsoft Corporation issues common stock. d. The State of Alaska issues a financial instrument with eight months to maturity. e. GMAC issue trades in the money market. f. U. S. security trades in the capital market. g. Microsoft stock trades in the capital market. h. State of Alaska security trades in the money market. 2. Give three reasons for the trend toward greater integration of financial markets throughout the world. There are several reasons. These include: a. Deregulation and/or liberalization of financial markets to permit greater participants from other countries; b. Technological innovations to provide globally-available information and to speed transactions; c. Institutionalization financial institutions are better able to diversify portfolio and exploit mis-pricings than are individuals. 3 Why does increased volatility in financial markets with respect to the price of financial assets, interest rates, and exchange rates foster financial innovation? Increased volatility of the prices of financial assets has fostered innovation as investors and institutions seek ways to mitigate financial risk. We will write a custom essay sample on Financial Institutions specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Financial Institutions specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Financial Institutions specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Among other things, these innovations include the advancement of the modern derivatives markets. Chapter 2 1. Each year, millions of American investors pour billions of dollars into investment companies, which use those dollars to buy the common stock of other companies. What do the investment companies offer investors who prefer to invest in the investment companies rather than buying the common stock of these other companies directly? In investing funds with the investment companies, investors are reducing their risk via diversification and the cost of contracting and information. These companies also provide liquidity to the investor. 2. a. Why is the term hedge to describe â€Å"hedge funds† misleading? b. Where is the term hedge fund described in the U. S. securities laws? a. Hedge denotes hedging risk. Many hedge funds, however, do not use hedge as a strategy, and these funds take significant risk in their attempt to achieve abnormal returns. b. The term is not described in US securities laws, and hedge funds are not regulated by the SEC. 3. Some hedge funds will refer to their strategies as â€Å"arbitrage strategies. † Why would this be misleading? Arbitrage means riskless profit. These opportunities are few and fleeting. Hedge funds take great risk. The arbitrage typically taken is where there is a disparity between the risk and the return, such as pricing disparities across markets. Chapter 3 1. What is the Basel Committee for Bank Supervision? a. What do the two frameworks, Basel I and Basel II, published by the Basel Committee for Bank Supervision, address regarding banking? a. It is the organization that plays the primary role in establishing risk and management guidelines for banks throughout the world. b. The frameworks set forth minimum capital requirements and standards. 2. Explain each of the following: a. reserve ratio b. required reserves a. The reserve ratio is the percentage of deposits a bank must keep in a non-interest-bearing account at the Fed. b. Required reserves are the actual dollar amounts based on a given reserve ratio. 3. How did the Glass-Steagall Act impact the operations of a bank? The Glass-Steagall Act prohibited banks from carrying out certain activities in the securities markets, which are principal investment banking activities. It also prohibited banks from engaging in insurance activities. Chapter 4 1. What is the role of a central bank? The role of a central bank has several functions: risk assessment, risk reduction, oversight of payment systems, and crisis management. It can do this through monetary policies, and through the implementation of regulations. 2. Why is it argued that a central bank should be independent of the government? Central banks should be independent of the short-term political interests and political influences generally in setting economic policies. 3. What is the discount rate, and to what type of action by a bank does it apply? The discount rate is the rate a bank pays to borrow at the â€Å"discount window† of the Fed. Such borrowings are often undertaken to meet temporary liquidity needs. Bank needs are monitored and the Fed likes to state that borrowing from it is a â€Å"privilege and not a right. † 4. a. What is an open market purchase by the Fed? b. Which unit of the Fed decides on open market policy, and what unit implements that policy? c. What is the immediate consequence of an open market purchase? a. An open market purchase by the Fed consists of the purchase of U. S. Treasury securities. . The FOMC decides on open market policy and directs the Federal Reserve Bank of New York to implement it through sales and purchases of these securities. c. The immediate consequence of an open market purchase is to supply the seller of the security with a check on the Federal Reserve System that he can deposit in his bank, thereby immediately increasing the excess reserves and thus nation’ s money supply. Chapter 5 1. Why is it impossible for the Fed to target, at the same time, both the Fed funds interest rate and the level of reserves in the banking system? An increase in reserves should have an opposite effect on interest rates (a decrease in rates as banks have more reserves to lend). However, the interest rate is a function of both the supply of money and the public’s demand for money. It is thus possible for an increase in reserves to be met by an increase in the demand to hold money; hence no decrease in interest rate levels. In like manner, when an interest rate is the target, the Fed must let the growth in reserves vary as it strives to keep certain levels of interest rates. 2. It is often said that you cannot hit two targets with one arrow. How does this comment apply to the use of monetary policy to â€Å"stabilize the economy†? Often there are countervailing effects of the Fed’s actions. As seen, the Fed must choose either a short-term rate or the level of some reserves and cannot choose to target both kinds of variables as an operating target. The Fed can stimulate an economy through a reduction in interest rates, but such stimulation could lead to inflation or bubbles. As well, dampening unsustainable growth can be achieved, but such actions can lead to recession. . Describe the differences and similarities of the conduct of Chairmen Greenspan and Bernanke in managing Fed policy. Up until the mortgage and crisis, Bernanke mostly maintained Greenspan’s policies, but he was viewed as being more open with respect to communications about the Fed’s policy and FOMC meetings. Additionally, Bernanke was expected to advocate a more q uantitative approach to policy as opposed to Greenspan’s subjective, eclectic approach Chapter 7 1. An investment company has $1. 05 million of assets, $50,000 of liabilities, and 10,000 shares outstanding. a. What is its NAV? b. Suppose the fund pays off its liabilities while at the same time the value of its assets double. How many shares will a deposit of $5,000 receive? a. Net asset value = (Total assets minus liabilities) / numbers of shares = 1,050,000 – 50,000 = $100 10,000 b. Net asset value = 2,100,000 – 0 = $210 10,000 No of shares = 5000 = 23. 81 shares. 210 2. â€Å"The NAV of an open-end fund is determined continuously throughout the trading day. † Explain why you agree or disagree with this statement. Disagree. NAV of open-ended fund is the closing price of the day 3. Why might the price of a share of a closed-end fund diverge from its NAV? The price of closed-end funds may differ from NAV (often at a discount) because the fund has a large built-in tax liabilities and investors are discounting the share’s price for future tax liabilities. Leverage may be another factor for price below NAV. 4. What is an index fund? An index fund e. g. Fidelity Magellan and Vanguard Samp;P 500 are mutual funds, which invests in stocks included in Samp;P 500, and aim to achieve its performance to the benchmark Samp;P500 returns 5. What are the advantages of an ETF relative to open-end and closed-end investment companies? As said earlier, price is continuously changing during the trading period. 6. Briefly describe the following in the context of mutual funds: a. supermarket b. wrap program c. segregated managed accounts d. family of funds a. Supermarkets: The introduction of the first mutual fund supermarket in 1992 by Charles Schwab amp; Co. introduced its One Source service. These supermarkets allow investors to purchase funds from participating companies without investors having to contact each fund company. b. Wrap program: Wrap accounts are managed accounts, typically mutual funds â€Å"wrapped† in a service package. The service provided is often asset allocation counsel; that is advice on the mix of managed funds. c. Segregated managed accounts: are in response to individuals who object to mutual funds because of their lack of control over taxes and other investment decisions. Many investors with medium-size portfolio are utilizing segregated accounts. d. Family of funds: In the U. S. system, a family of funds consists of an investment company that offers several different funds. In Japan the family fund allows investors to buy new certificates in a grouping of existing unit trusts. Chapter 9 1. Suppose you own a bond that pays $75 yearly in coupon interest and that is likely to be called in two years (because the firm has already announced that it will redeem the issue early). The call price will be $1,050. What is the price of your bond now, in the market, if the appropriate discount rate for this asset is 9%? PO = $75 (PVIFA) 2. 09 + $1050 (PVIF) 2. 09 =$75 X 1. 7591 + $1050 X . 8417 = $1015. 72 2. You have been considering a zero-coupon bond, which pays no interest but will pay a principal of $1,000 at the end of five years. The price of the bond is now $712. 99, and its required rate of return is 7. 0%. This morning’s news contained a surprising development. The government announced that the rate of inflation appears to be 5. 5% instead of the 4% that most people had been expecting. (Suppose most people had thought the real rate of interest was 3%. ) What would be the price of the bond, once the market began to absorb this new information about inflation? The nominal required rate of return is (real rate plus inflation) ir + if or currently 3% plus 4% = 7%. If if becomes 5. % then the new required rate of return becomes 8. 5%. The price of the bond would then be $1000/(1. 085)5 or $665. 05. 3. What is the cash flow of a 6% coupon bond that pays interest annually, matures in seven years, and has a principal of $1,000? a. Assuming a discount rate of 8%, what is the price of this bond? b. Assuming a discount rate of 8. 5%, what is the price of this bond? c. Assuming a discount rate of 7. 5%, what is the price of this bond? d. What is the duration of this bond, assuming that the price is the one you calculated in part (b)? e. If the yield changes by 100 basis points, from 8% to 7%, by how much would you approximate the percentage price change to be using your estimate of duration in part (e)? f. What is the actual percentage price change if the yield changes by 100 basis points? a. $60 a year interest for 7 years plus $1000 principal in year 7 for a total of $1420 in cash flow. b. 5. 2064 X $60 + . 583 X $1000 = $895. 38 c. 5. 119 X $60 + . 565 X $1000 = $872. 14 d. 5. 297 X $60 + . 603 X $1000 = $920. 82 e. D = $920-. 82-$872. 14 =$48. 68/8. 95=5. 44 $895. 38 (0. 85-. 075) f. Applying the formula-D (change in yield) = -5. 44 (. 01) or a price increase of 5. 42%. g. Price at 8% =$895. 88, at 7% = $946. 06, so actual percentage change is ($946. 06 $895. 88)/$895. 88=5. 6%. Chapter 10 1. How do the assets, money, and bonds differ in Keynes’s liquidity preference theory? a. How does a change in income affect the equilibrium level of the interest rate in Keynes’s theory? b. How does a change in the money supply affect that rate? a. Money (as demand deposits and cash) is considered the liquid asset that serves as a medium of exchange and a store of value. Such funds pay little or no interest. Bonds are not as liquid and do pay some interest. b. In Keynesian theory, the rate of interest is determined by the demand to hold money (liquidity preference) and the money supply. An increase in income will lead to an increase in the demand for transactions purposes; hence an increase in the equilibrium rate of interest. c. An increase in the money supply will initially create a situation where more money exists than public wish to hold. They will then use these excess funds for investments, driving down interest rates. 2. Consider three bonds, all with a par value of $1,000: Bond| Coupon Rate| Market Price| A| 8%| $1,100| B| 7| 900| C| 9| 1,000| a. What is the yield to maturity of bond C? b. Is the yield to maturity of bond A greater than or less than 8%? c. Is the yield to maturity of bond B greater than or less than 9%? a. The yield to maturity of bond C is 9% because its market price is equal to the par value. b. The yield to maturity of bond A is less than 8% since it is selling at a premium over par. An investor will get the 8% coupon payments but only $1000 at maturity, less than the $1100 he had paid for it. . Since bond B is selling at a discount, its yield is greater than the coupon rate, but how much depends upon the term to maturity. In the near term the yield exceeds 9%, but if the term of the bond goes out to 20 years, the actual yield to maturity will be less than 9%. a. Show the cash flows for the two bonds below, each of which has a par value of $1,000 and pays interest semiannually: B ond| Coupon Rate| Years to Maturity| Price| W| 7%| 5| $884. 20| Y| 9| 4| 967. 70| b. Calculate the yield to maturity for the two bonds. a. Bond W pays $35 twice a year for 5 years, pays $1000 in year 5. ond Y pays $45 semi-annually for 4 years and $1000 in year 4. b. Bond W’s cash flows must be discounted to equal $884. 20. Using a trial-and-error method of several rates the closest yield to maturity is 10. 6%. Try also using financial calculator to confirm this yield. Bond Y’s cash flows must be discounted to equal $967. 70. Using the trial-and-error method results this time in a yield to maturity of 9. 4%. 8. a. What is the credit risk associated with a U. S. Treasury security? b. Why is the Treasury yield considered the base interest rate? c. What is meant by on-the-run Treasuries? d. What is meant by off-the-run Treasuries? a. Essentially no credit risk Treasury securities are backed by the full faith and credit of the federal government. b. It has the least risk in terms of default risk and is highly liquid, since Treasury securities comprise the largest and most actively traded financial instruments in this country. c. â€Å"On-the-run† Treasury issues are the most recently auctioned issues for each maturity. â€Å"Off-the-run† issues are the older ones, auctioned before the current coupon issues 3. In the May 29, 1992, Weekly Market Update, published by Goldman Sachs amp; Co. the following information was reported in various exhibits for certain corporate bonds as of the close of business Thursday, May 28, 1992: Issuer| Rating| Yield | Spread| Treasury Benchmark| General Electric Capital Co. | Triple A| 7. 87%| 50| 10| Mobil Corp. | Double A| 7. 77| 40| 10| Southern Bell Tel amp; Teleg | Triple A| 8. 60| 72| 30| Bell Tel Co Pa| Double A| 8. 66| 78| 30| AMR Corp| Triple B| 9. 43| 155| 30| a. What is meant by rating? b. Which of the five bonds has the greatest credit risk? c. What is meant by spread? d. What is meant by Treasury benchmark? e. Explain how each of the spreads reported above was determined. f. Why does each spread reported above reflect a risk premium? a. A rating refers to a published indicator of creditworthiness or probability of default. b. The AMR Corp. has the greatest credit risk, because at Triple B it has the lowest rating of the group. c. Spreads are differences in yields among bonds. Most commonly the spread is calculated as the excess yield over a benchmark Treasury security. d. The Treasury benchmark is the government security with the same maturity as the corporate security under consideration. e. Each spread was determined by subtracting the appropriate Treasury benchmark yield as of May 29, 1992 from the non-Treasury security of the same maturity. f. The spread in each case constitutes a risk premium for bearing default and liquidity risks that are not inherent in Treasury securities. 4. What is meant by an embedded option in a bond? a. Give three examples of an embedded option that might be included in a bond issue. b. Does an embedded option increase or decrease the risk premium relative to the base interest rate? a. An embedded option in a bond can be associated with convertible bonds. The holder has a call option to convert into stock at his will and he is willing to pay a premium in terms of a lower yield for this privilege. The issuer may have an embedded option in terms of callability , forcing the bondholder to sell back the security at a given price at a time of the issuer’s choosing. b. Convertible features, putable bonds (that allow bondholders to sell the securities back to the issuers at par), and warrants attached to bonds are examples of options that may be included in bond issues. c. The answer depends on the nature of the option. If the buyer has a call option he will pay more for the bond and accept a lower yield. If the issuer has an option like a callable feature on a bond, he is paying a price in terms of a higher yield or lower bond price. Chapter 11 1. What is a yield curve? a. Historically, why has the Treasury yield curve been the one that is most closely watched by market participants? a. A yield curve is a geographical representation of the term structure (the relationship between yield to maturity and the term to maturity) of securities having the same credit rating. . Treasury securities are risk-free with respect to credit and liquidity, and their yields serve as benchmarks for other securities. 2. What are the types of risks associated with investing in bonds and how do these two risks affect the pure expectations theory? The expectations theory suggests that rates will change over time in some direction. The prospect of changing yields creates two risks related to bond investment: (1) the price risk (value of principal if sold prior to maturity) and the reinvestment risk. Low rates may be good for price increases, but their favorable impact is partially offset by investors having to reinvest earnings at these low rates Chapter 12 1. Assume the following: Expected market return = 15% Risk-free rate = 5. 7% If a security’s beta is 1. 3, what is its expected return according to the CAPM? The expected return is: .07+1. 3 (. 15-. 07) =. 174=17. 4%, (assume risk free rate =7%). 2. What are the difficulties in practice of applying the arbitrage pricing theory model? a. Does Roll’s criticism also apply to this pricing model? b. In the CAPM investors should be compensated for accepting systematic risk: for the APT model, investors are rewarded for accepting both systematic risk and unsystematic risk. † Do you agree with this statement? a. The difficulty lies in identifying the systematic factors. b. Roll’s criticism does not apply to the APT model because that model does not rely on a true market index. c. This statement is true for the CAPM, but not for the APT model. The latter also asserts that investors should be compensated only for accepting systematic risk. But unlike the CAPM, there is more than one systematic risk. Chapter 17 1. How does common stock differ from preferred stock? b. Why is preferred stock viewed as a senior corporate security? a. Preferred stock is entitled to a fixed participation in the form of dividends of the earnings of the company. Dividends must be declared and ordinarily they are at the discretion of the board. Common stock is entitled to the residual cashflow, and is junior to the preferred stock both in terms of distribution and liquidation preference. b. Preferred stock is considered a senior instrument because dividends must be paid before any distribution of dividends can be made to the common stockholders. Also, in a liquidation, the preferred stockholders are paid before the common stockholders, who are considered residual claimants. 2. Explain the mechanics and some key rules of a short sale. a. What restrictions are imposed on short selling activities? a. A short seller borrows the stocks to sell on the market, giving the proceeds of the sale to his broker as collateral. Should prices decline he will buy the stocks, return them to the broker and obtain the sales proceeds. b. A short sale must be announced at the time the order is given , and it can occur only after an uptick in the market price of the stock. The short seller is also responsible for paying any dividends due on the stocks before he covers them with a purchase. 3. What are the three general types of stock market indicators? Stock market indicators can be classified into three groups: (1) those produced by stock exchanges based on all stocks traded on the exchange; (2) those produced by organizations that subjectively select the stocks to be included in indexes; (3) those where stock selection is based on an objective measure, such as the market capitalization of the company. Chapter 18 1. Explain the two ways in which an order-driven market can be structured. An order-driven market can be structured in two ways: (1) continuous market, where a trade can be made at any moment in continuous time; (2) call auction, where orders are batched together for a simultaneous execution in multilateral trade at a specific point in time 2. Why is the Nasdaq referred to as a â€Å"fragmented market†? Nasdaq is a fragmented market because its stocks can be traded off the exchange. 3. What are the two sections of the Nasdaq stock market? The two sections are the Nasdaq National Market (NNM) and the Small Cap Market. . What are the three parts of the OTC market for stocks? There are three parts to the OTC market: two under Nasdaq and a third market for truly unlisted stocks (which is composed of OTC Bulletin Board and the Pink Sheets). Chapter 26 1. Suppose you bought a stock index futures contract for 200 and were required to put up initial margin of $10,000. The value of the co ntract is 200 times the $500 multiple, or $100,000. On the next three days, the contract’s settlement price was at these levels: day 1, 205; day 2, 197; day 3, 190. a. Calculate the value of your margin account on each day. b. If the maintenance margin for the contract is $7,000, how much variation margin did the exchange require you to put up at the end of the third day? c. If you had failed to put up that much, what would the exchange have done? a. Day 1 Price = $205 x 500 = $102,500, Margin = $12,250 Day 2 Price = $197 x 500 = $ 98,500, Margin = $ 8,500 Day 3 Price =$190 x 500 = $ 95,000, Margin = $ 5,000 b. Add $2,000 to meet variation margin requirements on the third day. c. If the margin call was not met, the exchange would have liquidated the position. 2. â€Å"The futures market is where price discovery takes place. † Do you agree with this statement? If so, why? If not, why not? Agree. This is true when there is a well-developed futures market that is more advantageous to use by market participants for changing their price exposure to an asset. Investors can more easily become involved in the market because the wealth required to participate is relatively small. a. What is meant by open interest? b. Why is open interest important to an investor? a. Open interest is the number of contracts outstanding. It is a measure of the liquidity of the contract and therefore important to portfolio managers who want to implement strategies using the contract 3. What is meant by an OTC derivative product? Customized derivative products, such as forward contracts, are called Over-the-counter derivatives. 4. What is the major concern with banks creating OTC derivative products? Banks that create OTC derivative products may put themselves in a position that could create severe financial problems. These banks may not have proper risk management systems in place to effectively monitor their risk exposure. Identify and explain the key features of an option contract. The exercise price is the price at which the holder of an option has the right to buy or sell a security. The expiration date is when the option holder’s right to sell or buy a stock expires. The premium is the price paid for an option. It is the consideration given for a contract, which binds the other party to buy or sell a security, if required. The underlying asset is the item which can be bought or sold by the option holder. 5. What is the difference between a put option and a call option? A put option is the right to sell a security at a specified price within a specified period of time. A call option is the right to buy a security at a specified price within a specified period of time. 6. What is the difference between an American option and a European option? An American option can be exercised anytime up to the date of expiration. A European option can only be exercised at the time of expiration 7. Explain why you agree or disagree with this statement: â€Å"Buying a put is just like short selling the underlying asset. You gain the same thing from either position, if the underlying asset’s price falls. If the price goes up, you have the same loss. † Buying a put indicates the same intention as short-selling a security. In both cases the speculator hopes to take advantage of a decrease in price of the security. The effect, however, is different on two counts. First, the short seller is taking a risk that prices may rise, that he may have to purchase the security at a higher price than he sold it. The put option holder’s maximum loss would be the price of the premium should he not exercise the option. Second, leverage also makes a difference. The short seller has to place the entire amount of his sale with the broker as collateral. The put holder has only a small amount invested, i. e. , the premium. Modest price decreases magnify his gains.

Steam Engine 2 essays

Steam Engine 2 essays The steam engine was invented by Thomas Newcomen in 17121. It was a very important invention and helped give way to the Industrial Revolution. It was very useful invention of his time. Many people like James Watt and Richard Trevithick used the atmospheric steam engine to produce more sophisticated inventions. Thomas Newcomen was a very important inventor. He was born in 1663 in Britain. He worked as a blacksmith until he worked with Thomas Savery, who had already tried to make a steam engine but couldnt do it. Thomas Newcomen invented the first working steam engine in 1712 with the help of Savery. At first the steam engine wasn't very popular, later the steam engine was considered the centurys most important invention when used in mines. Thomas Newcomen also made tools for coal miners and often visited mines, this is how he knew the needs of miners2. The first steam engine was used to work at a South Stafforshire colliery3. Most of the early engines produced the steam by using coal. This is why steam engines were installed in coal mines where coal was free. Even though Thomas Newcomen actual invented the first steam engine, James Watt is usually known for making it4. Watts engine was much more efficient than Newcomens because it prevented the loss of steam. Watt started out repairing Newcomens engines, and then began making major improvements to it. James Watts engines were much larger than Newcomens with a larger cylinder which pumped more water out of mines5. His engines were designed with a rotating shaft and a flywheel which was more sufficient. Later he further improved his engines by adding another condenser and cylinders. He also added throttle controls on his engine to control the rate that the engine pumped water. Without Watt's study in the field of mechanics, the steam engine might not have been made, and the industrial...

Project Management Essay Example | Topics and Well Written Essays - 2500 words - 17

Project Management - Essay Example This event hoped to raise money for charity, will include many kinds of sporting activities including skiing, darting, water rowing, table tennis and somersaulting among others. The recruitment exercise for participants in each category will be done in good time and communicated to the entire community. Members of Grand Sunrise area will be requested to turn up for this great event. This year’s competitions are more than the ordinary since activities have been sponsored to 1200 Pounds enable more participation and contribution to the event. The event dubbed ‘run 360’ to take place on 15 July 2012 is aimed at making the participants complete a circle of every event performed. The participants will be awarded according to the performance. To make the sport lively, a live music band will be invited to grace the occasion and entertain guests while preparations to begin kicks off. The music band will be members of the oxygen band who happen to be from grand sunrise area. Upon completion of the event the patron will reward the winners and give a closing speech. The patron will also be expected to give an expenditure brief of what was raised, used and the balance which will be used to fund a project for the mentally challenged in Lower Norwich rehabilitation facility. The competition ‘run 360’ is expected to draw about 65 participants and about 800 spectators. Since the onset to the sporting activities, the youth have been upbeat and happy that their holidays are well spent and are taking it to the next level by not only participating but also making a contribution to charity of their choice. The schools management and government education department have regularly advised parents and guardians to support and engage their children in sports as a way of promoting teamwork, partnerships and acceptable behavior. The event will be poised to bond the youth, parents and other guests who will attend the event. To

Safeway Inc Assignment Example | Topics and Well Written Essays - 250 words

Safeway Inc - Assignment Example In addition, they were affected since their target and loyal consumers no longer possess a large pool of any discretionary income affecting the overall demand thus revenue. Politically, the external environment that Safeway Inc. operates was significantly affected. During this crisis the Fed set tough laws and regulations concerning credit and lending to help the economy pull through. These monetary policies by the government never favored investment and plough of capital to the key sectors of growth of the company such as the necessity retail products. These further weakened the company’s competitiveness since this is an environment beyond the control of the company. Financial crisis directly affects the revenue obtainable by the company. Due to the financial crisis of 2008-2009, the company had to rethink on its social responsibility to boost sells. Prior to the crisis, the company was involved in various social participation such as charity events that help improve their relationship with the customers they serve. The company had to lower its active role in social participation and societal charity. This affected their eventual competitiveness after the

Feminist Philosophy Essay Example for Free

Feminist Philosophy Essay Mary Wollstonecraft was no doubt a great feminist and deserved to be called grandmother of the feminist thought. Her early experiences of an unsuccessful family life as well as the prevailing notion of the philosophers at that time about women shaped her views to become authentic feminist grand mother. Wollstonecraft’s feminist ideas affected the first wave of feminism through her arguments against the prevailing views on women most notably that of Rousseau’s which categorized women as subservient to men. Rousseau held that women’s education should be designed entirely to make them pleasing to men. Rousseau reflected â€Å"to please, to be useful to us, to make us love and esteem them, to educate us when young and take care of us when grown up, to advise, to console us, to render our lives easy and agreeable—these are duties of women at all times†¦Ã¢â‚¬ (Feminist Philosophy). Against this view, Wollstonecraft work hard to emphasize that the role of women in the society were not simply an ornaments and playthings of men as they are also capable of attaining masculine virtues of wisdom and rationality â€Å"if society would allow those value to be cultivated† (p.475-476). Wollstonecraft pointed out that the prevailing views on women had bad implications not only on women but on society as well as they will only breed bitterness, jealousy, and folly. She affected the first wave of feminist by encouraging them â€Å"to restore women to their lost dignity by encouraging better ideas of woman hood† (p. 476). How did Simone de Beauvoirs writing shape the second wave? The second wave of feminism was a resurgence of early feminism as a result of various works of feminists during the 1940s such as her works. De Beauvoir writings shaped the second wave of feminism by shedding light about what is a woman in the concept of being other, and how men views women during this period. In her writings de Beauvoir shed social understanding on womanhood. She pointed out that the fundamental social meaning of woman is Other. She explained, â€Å"No group ever sets itself up as the One without at once setting up the Other over against itself† (p. 479). The thought that de Beauvoir was pointing out was that men do not view women as human being like them but as Others who are to be treated as stranger that do not deserve equal treatment. The implication of men’s treatment of women as Others according to de Beauvoir was that because women are others, they do not need to be given â€Å"equal weight to their preferences† simply because they are others (p. 480). Debeauvoir’s writings shaped the second wave of feminism through her unique way of providing social understanding about how women were regarded by men during this period. How did the events of the first and second wave affect each other? Apparently, the event of the first and the second wave of feminism affect each other in a way that they connect the second wave to the first. The second wave feminist was inspired by the events during the first wave to tag along their path of pushing for the recognition of women’s rights. Apparently, the events of the first wave feminist shaped the understanding of the second wave feminism about women’s rights, against the existing social and philosophical views on women. Thus, the events of the first wave serves as mirror for the second wave, and as inspiration for them to continue women’s struggle for the restoration of their lost dignity as women equal with men in many aspect, especially on human rights. Reference More-Bruder: Philosophy: The Power of Ideas (2008) Feminist Philosophy The McGraw-Hill Companies

Case for Investment: Space in USA

Case for Investment: Space in USA Sun Yudong Ever since the dawn of man, mankind has been gazing at the sky in wonder. Space, has always been a mysterious place, a place where the frontier of science and innovation are put to the test, a place where 99% of what we have yet to discover exists. In the present era, the National Aeronautics and Space Administration (better known as NASA) and the NSF[1] are the forefronts of space exploration and scientific research in the USA and they have no doubt played a key role in many of Man’s greatest achievements. NASA could even take credit for mundane items such as quartz timing crystals and bar-code scanners. The Sad Situation Space is a difficult, dangerous but exciting $300 billion industry worldwide. However, despite space being the final frontier, with many against space exploration, NASA has only received 0.48% of the US Federal budget, only half a cent for every tax dollar. NASA is getting a pathetic amount of funding. In 2008, $700 billion[2] was spent by the US government to revive the economy, which was way more than the 50-year running budget of NASA. In 2013, US spent more than $3.45 trillion, with more than $600 billion going to defence, but with only $17.7 billion going to NASA, a tiny portion of worldwide spending on space. The allocation of funds is warped and there is just simply not enough funding going towards space exploration and scientific innovation, the seedling of hope, the future of the US economy. Over the past four decades, instead of NASA, we could have had at least six additional MIT’s. Consider all of the research that our single MIT has produced during that period, all of the students taught and leadership provided. For all the gains that NASA has made, its opportunity costs are far greater. Keith Yost, The Tech (MIT) Staff Columnist argument against NASA funding What is even more infuriating is that, even though the budget for NASA has been decreasing, the money saved were not put to good use. For example, US plans on spending more than $200 billion in the next decade to maintain nuclear weapons when they are almost useless. The one thing I convinced myself of after all these years of exposure to the use of nuclear weapons is that they were useless. They could not be used. Colin Powell, Former Secretary of State Figure 2 NASA Budget over the years. Retrieved August 31, 2014, from: http://www.penny4nasa.org/ However, NASA did get a substantial amount of funding and this increased steadily in its infancy and peaked in 1966 at slightly more than 4.4% of the Federal Budget, before plummeting to the current meagre 0.48%. Because of this, the campaign â€Å"penny4nasa† was launched in 2012 to fight for an increase in the budget for NASA, through advocating the economic, scientific and cultural value of NASA. With this as a trigger, the paper will look at the different factors that led to the establishment of NASA, the decline in the budget, and ultimately explore why we should invest in space, and space exploration. Why NASA was set up The roots of NASA could be traced back to October 4, 1957. On that day, the world’s first artificial satellite, Sputnik 1, was launched. This surprise success of the Soviets in the midst of the Cold War horrified the US and triggered the Sputnik Crisis that became part of the bigger Space Race. US was afraid, afraid that the Soviets would become more technologically advanced, that the Soviets would fire a missile at US, that US will lose its place on the global arena. Out of the fear factor of Sputnik, many policies were put in place. The National Defense Education Act (NDEA) was passed by congress to increase educational standards to allow more people to become scientists and engineers. And on July 29 1958, the National Aeronautics and Space Act was signed, establishing NASA. It took over the National Advisory Committee for Aeronautics (NACA) and currently is the United States government agency that is responsible for civilian space program and for aeronautics and aerospace research. With motivation from Sputnik 1, and large funding, many space programs were quickly developed and put into action. The Decline in Budget Throughout the Apollo Missions that ultimately aim to go to the Moon, NASA was very well funded, and all developments were extremely rapid. US was still in fierce competition with the Soviets. In 1969, the historic Apollo 11 mission put the first man on the Moon, and puts US in the lead ahead of the Soviets significantly. However, when US realised that the Soviets were not ready to go to the moon, the rate of progress in Space Exploration slowed. This was because, with the Soviets unable to catch up with US technological abilities and the Cold War becoming increasingly less intense, people were no longer as fearful of the Soviets as before, nobody was really interested in the STEM[3] fields anymore and those congressmen without NASA facilities in their state felt absolutely no reason why NASA should get so much funding as an increasing proportion of people want more welfare instead. As discussions went on the Congress, NASA naturally got increasingly less budget, resulting in the current situation. After all, congressmen work for the people, or they will lose their position in the next elections. However, I believe that they have failed to realise and consider the significance of NASA and space exploration on the culture and economics of the society. Significance of NASA and Space Exploration Social and Cultural Space is not a special interest, unlike what many people may think. Space exploration inspired a whole generation to dream about tomorrow, a tomorrow made possible by scientific innovations, in a time of turmoil. It provided a different kind of hope, a hope that our lives will change for the better. The homes of tomorrow, the transportation of tomorrow, all these ingrained in the many issues of magazines. Space frontiers, engineering frontiers were being breached almost weekly. Space influenced our culture, our zeitgeist. It galvanized the whole nation to want to work towards Tomorrow, influencing our creative minds, our culture. For example, almost every science fiction cartoon made in and after the 1960s had rockets with fins, fins of the V2 Rocket used in NASA missions. (Figure 3[4]) We saw space influences everywhere, even in Hollywood. Space exploration also inspired a whole generation of Scientists and Engineers as Innovation made the headlines. No special programmes were needed to attract them. There is a cultural presence of these activities. From 1968 to 1972, there has been a sharp significant increase in the number of students pursuing education and career in these fields. (Figure 4[5]) With the Space program, heroes were made. Space exploration is a force acting on the education pipeline and inspired a whole generation to join the scientific community. Space exploration also had a direct impact on the cultural asset of the human race. When we looked back from the moon, we rediscovered Earth with a whole new perspective, without borders, without conflicts. We saw earth as nature intended it, we saw earth as a whole. It is possible to see that Earthrise (Figure 5[6]) marked the tipping point, the moment when the sense of the space age flipped from what it meant for space to what it means for Earth Robert Poole, Earthrise: How Man First Saw the Earth It inspired us to take time off amidst the war to start thinking about Earth and nature. This is what sparked off a series of events: Figure 6 Timeline of Space Missions with happening events All these would not have happened so quickly without space exploration, without us looking back at earth to realise that earth is a home that is worth protecting. Economic Beyond culture, space exploration has also brought about economic benefits. Satellites, GPS, intercontinental communication, the Internet. All of these has been directly or indirectly influenced by space exploration, and has had a huge impact on our lives as man. By breaching space and engineering frontiers, there were innovations, spin-offs. Space exploration and engineering drives innovation, the fuel for our capitalist economies. In fact, the satellites that we use to transmit TV signals, to transmit Internet packets, to communicate globally, could only have been brought about by government-initiated space exploration. This is because space is expensive and has incalculable risks, and it is a venture only a government could have successfully led. In fact, innovation drives the economy so much so that one of the main messages of Robert Solow’s[7] work has been that a large proportion of the economy is driven by technological advancement. Conclusion As goes the health of space faring ambition, so too goes the emotional, spiritual intellectual, creative, economic ambitions of a nation Neil deGrasse Tyson, 2012 In conclusion, space exploration is not a special interest group, and its significance is far and outreaching. With NASA being the frontier of space exploration, more funding should to be given to the agency, not as a handout, but as an investment that is able to penetrate our culture and transcend generations to reach greater heights. References Belleflamme, P. (2012, September 25). How to make innovation drive economic growth? Retrieved September 6, 2014, from http://www.ipdigit.eu/2012/09/how-to-make-innovation-drive-economic-growth/ Bilstein, R. E. (1996). From NACA to NASA. In NASA SP-4206, Stages to Saturn: A Technological History of the Apollo/Saturn Launch Vehicles (pp. 32–33). NASA. Retrieved from http://history.nasa.gov/SP-4206/ch2.htm#32 Burrows, W. E. (1998). This New Ocean: The Story of the First Space Age. New York: Random House. Retrieved from http://www.amazon.ca/This-New-Ocean-Story-First/dp/0679445218/ref=sr_1_1?s=booksie=UTF8qid=1280690435sr=1-1#reader_0679445218 Demographic Trends: Undergraduate and Graduate Education. (n.d.). Retrieved from https://www.princeton.edu/~ota/disk2/1985/8507/850705.PDF Dr. Neil deGrasse Tyson: Launch Keynote: 28th National Space Symposium. (2012). Retrieved from http://www.youtube.com/watch?v=VLzKjxglNyEfeature=youtube_gdata_player Hunt, T. C. (2013, December 16). National Defense Education Act (NDEA). In Encyclopà ¦dia Britannica. Retrieved from http://global.britannica.com/EBchecked/topic/404717/National-Defense-Education-Act-NDEA Last Week Tonight with John Oliver: Nuclear Weapons (HBO). (2014). Retrieved from http://www.youtube.com/watch?v=1Y1ya-yF35gfeature=youtube_gdata_player NASA. (2005). The National Aeronautics and Space Act. Retrieved September 3, 2014, from http://www.nasa.gov/offices/ogc/about/space_act1.html National Science Foundation. (n.d.). Retrieved September 5, 2014, from http://www.allgov.com/departments/independent-agencies/national-science-foundation?agencyid=7341 Neil deGrasse Tyson We Stopped Dreaming (Episode 1). (2012). Retrieved from http://www.youtube.com/watch?v=CbIZU8cQWXcfeature=youtube_gdata_player Office of Management and Budget. (n.d.-a). Budget of the United States Government, Fiscal Year 2013. U.S. Government Printing Office, Washington 2010. Retrieved from http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/budget.pdf Office of Management and Budget. (n.d.-b). Retrieved September 4, 2014, from http://www.whitehouse.gov/omb OMB-President Obama’s 2013 Budget-Summary Table. (n.d.). Retrieved from http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/tables.pdf Penny4NASA | Penny4NASA is a nonprofit striving to increase NASA’s funding to 1% by encouraging popular support for NASA through education and outreach. (n.d.). Retrieved September 8, 2014, from http://www.penny4nasa.org/ Photo 17 of 58, Apollo 11. (2009, June 4). Retrieved September 3, 2014, from http://imageevent.com/afap/spaceandscience/apollo11;jsessionid=hmk1oipnb3.camel_s?p=16c=4n=1m=-1w=2s=0z=1y=2 Rosenberg, J. (n.d.). President John F. Kennedy Gives Man on the Moon Speech. Retrieved September 19, 2014, from http://history1900s.about.com/od/1960s/a/jfkmoon.htm Space Race. (2014, September 17). In Wikipedia, the free encyclopedia. Retrieved from http://en.wikipedia.org/w/index.php?title=Space_Raceoldid=625983337 Special Message to Congress on Urgent National Needs. (1961). Washington, D.C. Retrieved from http://www.jfklibrary.org/Asset-Viewer/xzw1gaeeTES6khED14P1Iw.aspx Sputnik crisis. (2014, September 14). In Wikipedia, the free encyclopedia. Retrieved from http://en.wikipedia.org/w/index.php?title=Sputnik_crisisoldid=622755710 Temple-Raston, D. (2008, October 3). Bush Signs $700 Billion Financial Bailout Bill. National Public Radio. Retrieved from http://www-cdn.npr.org/templates/story/story.php?storyId=95336601 V-2 rocket. (2014, September 19). In Wikipedia, the free encyclopedia. Retrieved from https://en.wikipedia.org/w/index.php?title=V-2_rocketoldid=626151508 We Stopped Dreaming (Episode 2) A New Perspective. (2012). Retrieved from http://www.youtube.com/watch?v=BFO2usVjfQcfeature=youtube_gdata_player Wilford, J. N. (2009, July 14). On Hand for Space History, as Superpowers Spar. The New York Times. Retrieved from http://www.nytimes.com/2009/07/14/science/space/14mission.html Yost, K. (2010, April 9). Should we cut NASA funding? The Tech, p. 6. 1 [1] The National Science Foundation (NSF) is a United States government agency set up to support fundamental research and education in all the non-medical fields of science and engineering. The National Institutes of Health is the medical counterpart of NSP. [2] Amount of money spent on Emergency Economic Stabilization Act of 2008, to bailout the U.S. financial system [3] Science, Technology, Engineering, and Mathematics [4] (Clockwise) MundodelPene, Start einer V2 [Photograph] (1943), Retrieved September 3, 2014, from: https://en.wikipedia.org/wiki/File:Bundesarchiv_Bild_141-1880,_Peenemà ¼nde,_Start_einer_V2.jpg, [Rocket Cartoon Image], Retrieved September 3, 2014, from: http://www.clipartbest.com/clipart-aiqenRx6T, 1956 GM Firebird II [Photograph] (n.d.), Retrieved September 3, 2014, from: http://www.carbodydesign.com/archive/2010/06/top-ten-concept-cars-of-the-fifties/ [5] Doctorate Degrees in Science and Engineering by Field and by Year, 1958-83. Retrieved September 15, 2014, from https://www.princeton.edu/~ota/disk2/1985/8507/850705.PDF [6] Figure 5 NASA / Bill Anders (1968) Earthrise over the moon [Photograph], Retrieved September 03, 2014, from: http://www.hq.nasa.gov/office/pao/History/alsj/a410/AS8-14-2383HR.jpg [7] Nobel Prize Laureate in Economics in 1987

The Importance Of Accounting In Our Modern Society

Accounting is a very important term to our modern society. It is the career for men and women who at the start have their eyes set on top positions in industry, management, government, and general business. Accounting is a basic need of every businessmen, from the operator of a filling station to the government of the United States. It†s so important to our society. None of the business organization can operate without is. They are there-somewhere-in every business. In small business, people use pen, ink and skill keep teh records. In large business, modern accounting machines are used to operate. Men and women are directing these machines in the accounting process. Wise businessmen enter business must have some accounting knowledge. Accounting is a vital element of business. It records the way a business has grown and, after analyzing figures, suggests the way it should go in the future. Furtunes are gambled on the advice of accountants. If your friend has ever operated a business and you saw him placing figures in ledgers, then you saw him doing bookkeeping. If you have worked at a service station or supermarket and have seen books with large sheets lined in green and red lying on the manager†s table or desk, you saw books of accounting. Accounting is one of the fastest growing fields in the United States It expands each time a new store, a factory, a filling station, or a school goes up, whether in a large city or a small town. In today†s society, the demand for good accountants for exceeds the supply. As our country has expanded, business and industry have become more and more complex, so control here is very important. And control depends on a great deal of the bookkeepers and accountants who can analyze figues and advise management on what should be done. They are using more scientific ways changing money, figuring change, and collecting sales taxes. Moreover, department stores and other companies now have plants and offices widely scattered throughout the country. A new set of bookkeepers and accountants, is needed at each branch. I know there are many managements supervisory, and junior or senior executive positions are bing filled by people who started as accountants because accountants have the knowledge of methods and finance and comprehension of the fundamentals of business, and accounting is the foundation of sound business. The two kinds of accountants, public accountants and private accountants serve different important functions in business organization. Business enterprises, government agencies, and nonprofit institutions, such as universities and churches more are more likely use public accountant. They offer their services to the general public on a fee basis in much the same way as do lawyers, doctors, and dentists. In addition, the larger firms have professional accountants on their staff who work for a salary, but are also considered public accountants. The two important areas, auditing and tax services are also the job for public accountants. In a single business enterprise or nonprofit organization, the main job for private accounts in to handle the finanacial records. Manufacturing or other concerns are also need accountants, in that situation, they are often called industrial accountants. In addition, accountants are employeed by all branches of federal state, and local government, including government-owned corporations. Accountants in private and government work customarily specialize in the performance of a single type of accounting service, they may do any of the types of accounting service just described above. They also tend to become specialists in a narrow field of employment such as a particular branch of manufacturing, public utilities, or transportation. Except public accountants and private accountants, there are some other general category of accountants who are taking important parts in business organizations. They are managerial accountants, controller, cost accountant, government accountant, internal accountant and teaching accountant. Each of the accountant serves different function in business organization. A company needs well-organized management. Managerial accountant is a kind of person hired by a company and trained to be a manager one day. The managerial accountant, needs to learn all aspects of the company-people, products, plants, and equipments. They should know how to handle management responsibility, and administrative skills. A company needs somebody to record its financial operating datas, and measure performance, and it needs somebody to interpret results of operations, and to plan and make recommendations for actions. Controller is this kind person of the company and is responsible for the records of the company†s operation. His or her job is not only deal with finances, but also deal with people, products, equipments and material. In addition, he or she also needs to concern about sales and profit of the company. Like the president or vicepresident, controller has opportunities to exercise imagination and judgement and to make rewarding contribution to the company. A corporation may exist many different items in managactures, and those items go hundreds of various sized and priced componenets. The sales office will have to know the production cost of each item in order ot arrive at a sales price that will contain a profit for the company. A cost accountant works on it. He studies the items one by one, figures the cost of every parts of the products, and then arrives at the production cost of each item. Organizations of federal, state, or municipal government also need accountants to help their business. Government accountants come to do a variety of financial management work. They may deal with auditing, designing and maintaining. They may do budgeting and administrative duties requiring the use of accounting information. A modern business organization needs internal accountant to see whether the assets of a business are properly protected and accounted for, that current trasactions are completely recorded, or the company†s waste and loss whether to be saved or not. High schools, colleges or universities are also need accounting professors to teach students accounting techniques. Teaching accountants, who know a great deal about accounting and has had some practical experience in dealing with persons and businesses, ready to pass along their knowledge and experiences to students and future accountants. In small schools, teachers have other duties besides their work in the classrooms. They serve as school secretaries, bookkeepers, statistical clerks, and managers in lunchrooms. In addition to the accounts mentioned above, you may also find tax accountant, a systems and control accountant, a budget accountant, or an auditor. Working people need to pay taxes. Tax is so important to our society. It†s a main financial imcome of the government. People have to pay different kinds of tax according to their imcome. For example, they need to pay imcome tax, social security tax, state unemployment tax, federal excise tax, state and local sales and miscellantous taxes, property taxes, and federal and state taxes on corportation imcomes. As an accountant, one of the job he needs to do is to hepl people to pay taxes. Taxes and accounting are intervined. In dividual tax liabilities are arrived at by an accounting process. Large corporations that pay taxes in the hundreds of thousands of dollars, hire many accountants. Thus, accountant is tightly related to the tax adminatration. Accountants use skills in tax matters to help prepare people yearly report. According to the statistics, â€Å"In California, individual CPA practitioners report that around 21 percent of their business is tax work. Public accountant practitioners, who are closer to the small income earners, report that 25 percent of their business is tax work. † Especially public accountants, their large percentage of income is come from tax work. Because of the development of the modern society and increasement of peoples† income, more and more accountants are needed for tax work. Sound business needs good record, so control accountants are needed for this. They can help and advice managers to well develop their business. Some government firms and other organizations such as banks, stores, schools, churches, need auditors to operate the business. The auditor†s report will be of particular value to stockholders and creditors, since it shows an impartial opinion of the company is financial condition. For the management of the company, the auditor can often make very valuable suggestions for cutting costs, minmizing tax liabilities, and finding new ways to increase profits. Let†s look some accounting jobs in government. There are two million federal employees are working for the government , dealing with problems of population, education, transportation, national security, welfare and others. Accountants, auditors, system analysts, and budget administrators are helping to maintain the stability in modern governmental operations. United Stated is teh largest enterprise in the world today, we can imagine how complexity of the business got to be, so accountants take important parts in the operation of these business. They work for department of Agriculture, department of Commerce, department of Defense, department of Health, Edaucaiton, and Welfare, post offic edepartment and department of teh Treasury. Department of Agriculture deal with agricultural production, chemistry, economics, engineering, marketing, conservation, price support, and production adjustment problems. The department nees accountants to help its programs. The main job for accountant in this agency is to develop and maintain financial management systems, prepare and analyze budgetary and program lost statements, check costs of commercial food processors and producers, audit various operations in the office and in the field, and check records of commercial, cooperative, and state and municipal organizations participating in agricultural programs. Department of Commerce performs a wide range of operations. It gathers information about domestic and foreign industries and trade, publishes technical information for the government, and handles allocations of materials necessary to military and atomic energy programs. It†s also a place which needs accountants. Accountants here maintain regulatory and cost accounting systems, and audit steamship, railroad, and utility companies. Department of defense is an department which includes departments of the Army, Navy, and Air Force. This department has established an ideal career program to help recruit auditors and accountants. The department needs a well-qualified accountants and auditors. Those accountants are needed to handle cost accounting, property and inventory accounting, inernal and external auditing, and budgeting. Under the department of Health, Education, and Welfare, there are Public Health Servide, the Food and Drug Administration, the Office of Education, the Social Security Administration, and the Office of Vacational Rehabilitation. Those offices are located every where in the United States, so countless accountants are needed to operate in these organizations. The work mostly involves cost accounting, hospital accounting budgeting, auditing, and financial mangement. Post Office Deartmetn is another place which needs accountants assistants. This large department employs more than 560,000 persons and operates over 35,000 post offices. Besides that, it provides money-order and postal-saving services. All this naturally involves large sums of money and huge volumes of transactions. To handle it all, â€Å"The depatment has set up within its organization a Bureau of Finance, which looks after the the accounting, budgeting, cost accounting, keeping statistics and financial data, nd financial management work. † Department of the Treasury serves as the government†s banker, bookkeeper, disburser, collector, trustee, investor, lender, printer of the currency, coiner of money, supervisor of national banks, and financial advisor to the President and Congress. It†s not hard to see that each of these duties involves accounting. The Treasure Department needs men and women educated and trained in accounting, auditiing, budgeting, and financial management. Here accountants may be systems accountants, general accountants, cost accountants, internal auditors, revenue agents, bank examiners, budget and fiscal officers, management analysts, tax analysts, and public debt analysts. There are also a nember of independent agencies with which an accountant may find interesting and challenging work. There are the Atomi Energy Commission, the Farm Credit Administration, the Interstate Commerce Commission, the Securities and Exchange Commission and other important commissions, an accountant can find an easy way upward to general administrative and managerial positions. There is a overseeing department is called the United States Greneral Accounting Office. Just as a company president is the top man over many men and departments below him. The department generally oversees all the other agencies of the government. This vital department is headed by the comptroller General of the United States. As the President is called the Chief Executive of the nation, you could call the comptroller General the Chief Accountant of the nation. His office, an independent agency in the legislative branch, has the vitally important job of making audits of the programs, activities, and financial responsibilities of federal departments and agencies. It even checks government contracts. Since women†s position has been improved in the U. S, accounting also opened its door to women. It can be the world of achievement for the women who is looking for a higher ststus than what is offered by ledgers and journals. Accountants in today†s society is expected to know a great deal about management, business practice and theory, taxes, cost accounting, auditing, and systems and controls. To the woman who can train these and other subjects gose the opportunity to work at the management level with executives and leaders of business. Women also have opportunities for specialization and self-employment in an accounting firm. That†s why I say accounting is the door which widely open to women, and more and more women are stepping into it. According to the statistics â€Å"By 1910, there were about 190,000 women engaged in the occapation. From 1940-1950 the increase in female bookkeepers was 37,395. An estimate, based on the 1950 census, showed 556,229 women bookkeepers compared to only 164,748 men in the same employment. The figures show women occupy a large percentage in accounting field. Accounting is every where. Non eof the business or nonbusiness organization can stay longer without it. There is no doubt that all the business require some people who have some experience or knowledge in bookkeeping and accounting. More and more employers prefer employees with some knowledge of bookkeeping and accounting. There are other some examples of accounting job are required in different business: Office Manager-accountant, excellent salary, may advance to plany controller. The Importance Of Accounting In Our Modern Society Accounting is a very important term to our modern society. It is the career for men and women who at the start have their eyes set on top positions in industry, management, government, and general business. Accounting is a basic need of every businessmen, from the operator of a filling station to the government of the United States. It†s so important to our society. None of the business organization can operate without is. They are there-somewhere-in every business. In small business, people use pen, ink and skill keep teh records. In large business, modern accounting machines are used to operate. Men and women are directing these machines in the accounting process. Wise businessmen enter business must have some accounting knowledge. Accounting is a vital element of business. It records the way a business has grown and, after analyzing figures, suggests the way it should go in the future. Furtunes are gambled on the advice of accountants. If your friend has ever operated a business and you saw him placing figures in ledgers, then you saw him doing bookkeeping. If you have worked at a service station or supermarket and have seen books with large sheets lined in green and red lying on the manager†s table or desk, you saw books of accounting. Accounting is one of the fastest growing fields in the United States It expands each time a new store, a factory, a filling station, or a school goes up, whether in a large city or a small town. In today†s society, the demand for good accountants for exceeds the supply. As our country has expanded, business and industry have become more and more complex, so control here is very important. And control depends on a great deal of the bookkeepers and accountants who can analyze figues and advise management on what should be done. They are using more scientific ways changing money, figuring change, and collecting sales taxes. Moreover, department stores and other companies now have plants and offices widely scattered throughout the country. A new set of bookkeepers and accountants, is needed at each branch. I know there are many managements supervisory, and junior or senior executive positions are bing filled by people who started as accountants because accountants have the knowledge of methods and finance and comprehension of the fundamentals of business, and accounting is the foundation of sound business. The two kinds of accountants, public accountants and private accountants serve different important functions in business organization. Business enterprises, government agencies, and nonprofit institutions, such as universities and churches more are more likely use public accountant. They offer their services to the general public on a fee basis in much the same way as do lawyers, doctors, and dentists. In addition, the larger firms have professional accountants on their staff who work for a salary, but are also considered public accountants. The two important areas, auditing and tax services are also the job for public accountants. In a single business enterprise or nonprofit organization, the main job for private accounts in to handle the finanacial records. Manufacturing or other concerns are also need accountants, in that situation, they are often called industrial accountants. In addition, accountants are employeed by all branches of federal state, and local government, including government-owned corporations. Accountants in private and government work customarily specialize in the performance of a single type of accounting service, they may do any of the types of accounting service just described above. They also tend to become specialists in a narrow field of employment such as a particular branch of manufacturing, public utilities, or transportation. Except public accountants and private accountants, there are some other general category of accountants who are taking important parts in business organizations. They are managerial accountants, controller, cost accountant, government accountant, internal accountant and teaching accountant. Each of the accountant serves different function in business organization. A company needs well-organized management. Managerial accountant is a kind of person hired by a company and trained to be a manager one day. The managerial accountant, needs to learn all aspects of the company-people, products, plants, and equipments. They should know how to handle management responsibility, and administrative skills. A company needs somebody to record its financial operating datas, and measure performance, and it needs somebody to interpret results of operations, and to plan and make recommendations for actions. Controller is this kind person of the company and is responsible for the records of the company†s operation. His or her job is not only deal with finances, but also deal with people, products, equipments and material. In addition, he or she also needs to concern about sales and profit of the company. Like the president or vicepresident, controller has opportunities to exercise imagination and judgement and to make rewarding contribution to the company. A corporation may exist many different items in managactures, and those items go hundreds of various sized and priced componenets. The sales office will have to know the production cost of each item in order ot arrive at a sales price that will contain a profit for the company. A cost accountant works on it. He studies the items one by one, figures the cost of every parts of the products, and then arrives at the production cost of each item. Organizations of federal, state, or municipal government also need accountants to help their business. Government accountants come to do a variety of financial management work. They may deal with auditing, designing and maintaining. They may do budgeting and administrative duties requiring the use of accounting information. A modern business organization needs internal accountant to see whether the assets of a business are properly protected and accounted for, that current trasactions are completely recorded, or the company†s waste and loss whether to be saved or not. High schools, colleges or universities are also need accounting professors to teach students accounting techniques. Teaching accountants, who know a great deal about accounting and has had some practical experience in dealing with persons and businesses, ready to pass along their knowledge and experiences to students and future accountants. In small schools, teachers have other duties besides their work in the classrooms. They serve as school secretaries, bookkeepers, statistical clerks, and managers in lunchrooms. In addition to the accounts mentioned above, you may also find tax accountant, a systems and control accountant, a budget accountant, or an auditor. Working people need to pay taxes. Tax is so important to our society. It†s a main financial imcome of the government. People have to pay different kinds of tax according to their imcome. For example, they need to pay imcome tax, social security tax, state unemployment tax, federal excise tax, state and local sales and miscellantous taxes, property taxes, and federal and state taxes on corportation imcomes. As an accountant, one of the job he needs to do is to hepl people to pay taxes. Taxes and accounting are intervined. In dividual tax liabilities are arrived at by an accounting process. Large corporations that pay taxes in the hundreds of thousands of dollars, hire many accountants. Thus, accountant is tightly related to the tax adminatration. Accountants use skills in tax matters to help prepare people yearly report. According to the statistics, â€Å"In California, individual CPA practitioners report that around 21 percent of their business is tax work. Public accountant practitioners, who are closer to the small income earners, report that 25 percent of their business is tax work. † Especially public accountants, their large percentage of income is come from tax work. Because of the development of the modern society and increasement of peoples† income, more and more accountants are needed for tax work. Sound business needs good record, so control accountants are needed for this. They can help and advice managers to well develop their business. Some government firms and other organizations such as banks, stores, schools, churches, need auditors to operate the business. The auditor†s report will be of particular value to stockholders and creditors, since it shows an impartial opinion of the company is financial condition. For the management of the company, the auditor can often make very valuable suggestions for cutting costs, minmizing tax liabilities, and finding new ways to increase profits. Let†s look some accounting jobs in government. There are two million federal employees are working for the government , dealing with problems of population, education, transportation, national security, welfare and others. Accountants, auditors, system analysts, and budget administrators are helping to maintain the stability in modern governmental operations. United Stated is teh largest enterprise in the world today, we can imagine how complexity of the business got to be, so accountants take important parts in the operation of these business. They work for department of Agriculture, department of Commerce, department of Defense, department of Health, Edaucaiton, and Welfare, post offic edepartment and department of teh Treasury. Department of Agriculture deal with agricultural production, chemistry, economics, engineering, marketing, conservation, price support, and production adjustment problems. The department nees accountants to help its programs. The main job for accountant in this agency is to develop and maintain financial management systems, prepare and analyze budgetary and program lost statements, check costs of commercial food processors and producers, audit various operations in the office and in the field, and check records of commercial, cooperative, and state and municipal organizations participating in agricultural programs. Department of Commerce performs a wide range of operations. It gathers information about domestic and foreign industries and trade, publishes technical information for the government, and handles allocations of materials necessary to military and atomic energy programs. It†s also a place which needs accountants. Accountants here maintain regulatory and cost accounting systems, and audit steamship, railroad, and utility companies. Department of defense is an department which includes departments of the Army, Navy, and Air Force. This department has established an ideal career program to help recruit auditors and accountants. The department needs a well-qualified accountants and auditors. Those accountants are needed to handle cost accounting, property and inventory accounting, inernal and external auditing, and budgeting. Under the department of Health, Education, and Welfare, there are Public Health Servide, the Food and Drug Administration, the Office of Education, the Social Security Administration, and the Office of Vacational Rehabilitation. Those offices are located every where in the United States, so countless accountants are needed to operate in these organizations. The work mostly involves cost accounting, hospital accounting budgeting, auditing, and financial mangement. Post Office Deartmetn is another place which needs accountants assistants. This large department employs more than 560,000 persons and operates over 35,000 post offices. Besides that, it provides money-order and postal-saving services. All this naturally involves large sums of money and huge volumes of transactions. To handle it all, â€Å"The depatment has set up within its organization a Bureau of Finance, which looks after the the accounting, budgeting, cost accounting, keeping statistics and financial data, nd financial management work. † Department of the Treasury serves as the government†s banker, bookkeeper, disburser, collector, trustee, investor, lender, printer of the currency, coiner of money, supervisor of national banks, and financial advisor to the President and Congress. It†s not hard to see that each of these duties involves accounting. The Treasure Department needs men and women educated and trained in accounting, auditiing, budgeting, and financial management. Here accountants may be systems accountants, general accountants, cost accountants, internal auditors, revenue agents, bank examiners, budget and fiscal officers, management analysts, tax analysts, and public debt analysts. There are also a nember of independent agencies with which an accountant may find interesting and challenging work. There are the Atomi Energy Commission, the Farm Credit Administration, the Interstate Commerce Commission, the Securities and Exchange Commission and other important commissions, an accountant can find an easy way upward to general administrative and managerial positions. There is a overseeing department is called the United States Greneral Accounting Office. Just as a company president is the top man over many men and departments below him. The department generally oversees all the other agencies of the government. This vital department is headed by the comptroller General of the United States. As the President is called the Chief Executive of the nation, you could call the comptroller General the Chief Accountant of the nation. His office, an independent agency in the legislative branch, has the vitally important job of making audits of the programs, activities, and financial responsibilities of federal departments and agencies. It even checks government contracts. Since women†s position has been improved in the U. S, accounting also opened its door to women. It can be the world of achievement for the women who is looking for a higher ststus than what is offered by ledgers and journals. Accountants in today†s society is expected to know a great deal about management, business practice and theory, taxes, cost accounting, auditing, and systems and controls. To the woman who can train these and other subjects gose the opportunity to work at the management level with executives and leaders of business. Women also have opportunities for specialization and self-employment in an accounting firm. That†s why I say accounting is the door which widely open to women, and more and more women are stepping into it. According to the statistics â€Å"By 1910, there were about 190,000 women engaged in the occapation. From 1940-1950 the increase in female bookkeepers was 37,395. An estimate, based on the 1950 census, showed 556,229 women bookkeepers compared to only 164,748 men in the same employment. The figures show women occupy a large percentage in accounting field. Accounting is every where. Non eof the business or nonbusiness organization can stay longer without it. There is no doubt that all the business require some people who have some experience or knowledge in bookkeeping and accounting. More and more employers prefer employees with some knowledge of bookkeeping and accounting. There are other some examples of accounting job are required in different business: Office Manager-accountant, excellent salary, may advance to plany controller.

Modes of Acceptance

An acceptance must be communicated for it to be effective and valid. The mental assent of both parties is not required but the external manifestation should exist. The acceptor must dos something in order to notify his acceptance. For example, he should communicate his acceptance of the offeror. This can be illustrated in the case of Brogden v Metropolitan Railway Co (1877) 2 App Cas 666. In this case, the defendants had for some years supplied the plaintiffs with coals. It was suggested by the defendants that a contract should be entered into between them. After their agents had met, the terms of the agreement were drawn up by the plaintiffs' agent and sent to the defendants. The head of the defendants' firm filled up certain parts of the agreement which had been left blank, inserted the name of the proposed arbitrator, wrote â€Å"approved† at the end of the page, and signed his own name. The defendants' agent sent the document back to the plaintiffs' agent, who put it in his desk. Nothing further was done to execute the agreement. For some time, both parties acted in accordance with the arrangements stated in the document. Subsequently, the defendants declined to continue the supply of coals in this manner. The plaintiffs brought an action for damages for breach of contract. The defendants denied the existence of any contract for the supply of coals. the House of Lords held that there was no acceptance of the offer. Although there may be mental assent, the act of the plaintiff's agent putting the document into his desk would not amount to communication of the acceptance. However, the House of Lords held that by virtue of the course of dealings of the parties in the ordering and supply of the coals, such conduct amounted to an acceptance. The communication of an offer and an acceptance, which are the requirements of a valid agreement, is stated in Section 3 of the Contracts Act 1950. It was described that the communication of proposals, the acceptance of proposals, and the revocation of proposals and acceptances, respectively, are deemed to be made by any act or omission of the party proposing, accepting, or revoking, by which he intends to communicate the proposal, acceptance, or revocation, or which has the effect of communicating it. Communication of an acceptance is also illustrated in the Contracts Act 1950. It was described in Section 4(2) of the Contracts Act 1950 when the communication of acceptance will be complete. It was stated in Section 4(2)(a) that the communication of acceptance against the proposer is complete, when it is put in the course of transmission to him, so as to be out of the power of the acceptor. It was stated in Section 4(2)(b) that the communication of acceptance as against the acceptor is complete when it comes to the knowledge of the person whom it is made to who is the proposer. This is further explained in Illustration (b) that the communication of the acceptance is complete as against A, the proposer, when the letter is posted; and as against B, the acceptor, when the letter is received by A, the proposer. Besides that, Section 9 of the Contracts Act also describes the mode of acceptance. It provides that as far as an acceptance is made in words, the promise is said to be express. If the acceptance is made otherwise than in words, the promise is then said to be implied. Thus, an acceptance can be made through conduct. Section 8 of the Contracts Act provides for such acceptance where it is through the performance of conditions in a proposal. This can be seen in the case of Carlill v Carbolic Smoke Ball Co [1892] 2 QB 484; [1893] 1 QB 256. In this case, , the defendant, a proprietor of a medical preparation called â€Å"The Carbollic Smoke Ball† issued an advertisement offering to pay a sum of money to person who contracted influenza even after using the ball in the prescribed manner and time. Defendant banked in a sum of money to gain the confidence of the public. Plaintiff bought and used the ball in the manner prescribed and caught influenza. She claimed for the compensation but the defendant refused to compensate her. She then sued the defendant. Defendant contended that the advertisement was a mere puff and was not intended to create a binding obligation. Court of Appeal held that an offer can be made to the world and it becomes a contract when any person performs the condition. It was also mentioned in Section 7(b) of the Contracts Act that where the mode of cceptance is specified in the offer, the acceptor must communicate his acceptance in that mode. If no mode is specified, acceptance by any usual and reasonable manner which shows the acceptor's intention to accept is sufficient. There are a few types of communication of acceptance. First is via post or telegram. There is a difficulty in this type os communication of acceptance due to the time lag between sending and receiving and in situations where the acceptance is not received by t he offeror without the fault of either party. The general rule at common law is that acceptance is complete when it is brought to the notice of the offeror. But it was stated in the postal rule that an acceptance is complete when the letter containing such acceptance is posted, or when the telegram containing such acceptance is handed in. This can be seen in the case of Household Fire and Carriage Accident Insurance v Grant (1879) 4 EX D 216; 41 LT 298, CA. In this case, the defendant made an application for shares in the plaintiff's company under circumstances from which it must be implied that he authorised the company, in the event of their allotting to him the shares applied for, to send the notice of allotment by post. The company did allot him the shares, and posted a letter duly addressed to him containing the notice of allotment, but it was found as a fact that the letter never reached its destination. The defendant never paid the price of the shares as stated in the application. Subsequently, the company went into liquidation and the official liquidator applied for the unpaid price of the shares from the defendant. The defendant declined to pay on the ground that he was not a shareholder. The Court of Appeal affirmed the judgment of Lopes J and held that the defendant was liable as a shareholder. In this case, the Court applied the postal rule. Thus, the communication of the company's acceptance of the defendant's application for, and allotment of shares which was sent by post was complete once it was posted. Thesiger J explained the rationale of the postal rule as follows: â€Å"I see no better mode than that of treating the post office as the agent of both parties †¦ But if the post office be such common agent, then it seems to me to follow that, as soon as the letter of acceptance is delivered to the post office, the contract is made as complete and final and absolutely binding as if the acceptor had put his letter into the hands of a messenger sent by the offerer himself as his agent to deliver the offer and receive the acceptance. I am not prepared to admit that the implication in question will lead to any great or general inconvenience or hardhip. An offerer, if he chooses, may always make the formation of the contract which he proposes dependent upon the actual communication to himself of the acceptance. If he trusts to the post he trusts to a means of communication which, as a rule, does not fail, and if no answer to his offer is received by him, and the matter is of importance to him, he can make inquiries of the person to whom his offer was addressed. On the other hand, if the contract is not finally concluded, except in the event of the acceptance actually reaching the offerer, the door would be opened to the perpetration of much fraud, and, putting aside this consideration, considerable delay in commercial transactions, in which despatch is, as a rule, of the greatest consequence, would be occasioned; for the acceptor would never be entirely safe in acting upon his acceptance until he had received notice that his letter of acceptance had reached its destination†. The application of the postal rule can also be seen in the case of Adams v Lindsell (1818) 1B & Ald 681. In this case, the defendants, who were dealers of wool, had on September 2, written to the plaintiffs, woollen manufacturers, offering to sell to them a number of fleeces. They required an answer â€Å"in course of post†. The letter was misdirected by the defendants, and consequently was not received by the plaintiffs until September 5. On the same evening, the plaintiffs wrote an answer, agreeing to accept the offer on the terms proposed. The acceptance did not reach the defendants until September 9. On September 8, the defendants, not having received an answer on September 7, as they had expected, sold the wool, to a third party. The Court applied the postal rule of acceptance and held that the acceptance was complete as against the defendants on September 5. For example, prior to the revocation of their offer through the sale of the wool to the third party on September 8. The Court held that if the rule was that no contract could be formed until the acceptance was actually received, no contract could ever be completed; for if the defendants were not bound by their offer till the answer was received, the plaintiffs ought not to be bound till after they had received the notification that the defendants had received their answer and assented to it, and so it might go on ad infinitum. An acceptance should be made in the usual and reasonable manner. It can be seen in the case of Henthon v Fraser[1892] 2 Ch 27. In this case, the claimant received a note from the defendant with an offer to purchase a certain property within 14 days. The claimant responded to the offer with an acceptance posted the next day via mail. The defendant withdrew the offer before receiving the acceptance, but after the acceptance was posted. Court of Appeal inferred that both parties would have contemplated that the letter be sent by post. Lord Herschell stated: â€Å"In the present case an authority to accept by post must be implied. Although the Plaintiff received the offer at the Defendants' office in Liverpool, he resided in another town, and it must have been in contemplation that he would take the offer, which by its terms was to remain open for some days, with him to his place of residence, and those who made the offer must have known that it would be according to the ordinary usages of mankind that if he accepted it he should communicate his acceptance by means of the post where the circumstances are such the acceptance is complete as soon as it is posted†. In the case of Holwell Securities Ltd v Hughes [1974] 1 WLR 155. In this case, the defendant issued a grant to sell a property at 571 High Road, Wembley. It contained a clause stipulating that there must be notice in writing within six months in order to exercise the option. The claimants sent a letter exercising the option. It was lost in the mail and was never received by the defendant. The Court placed much emphasis on the meaning of notice which must mean that it must be known or intimated to the vendor who never was since the letter carrying the information went astray. Lawton Lj referred to the postal rule but held that it would not apply if the offer expressly specifies that the acceptance must reach the offeror and if application of the rule causes â€Å"manifest inconvenience and absurdity†. In the case of Lee Seng Heng & Ors v Guardian Assurance Co Ltd [1932] MLJ17. In this case, the plaintiffs insured their stock in trade with the defendants against fire. Subsequently, a fire broke out on the insured premises and the plaintiffs made a claim under the policy. The defendants' solicitors wrote to the plaintiffs saying that on the date of the fire, the policy had ceased to exist as they had previously written to the plaintiffs cancelling the policy. This letter was never received by the plaintiffs as there was no post office at Buloh Kasap. The nearest post office was at the town of Segamat and the practice at Segamat was to send a postman to Buloh Kasap only when the amount of correspondence justified a special journey. The letter in question had been kept at Segamat and had only been brought to Buloh Kasap by the postman after the fire. As the plaintiffs' premises had been burnt down, the addressee could not be found. Munson CJ stated that â€Å"The only point, therefore, left for me to decide is whether the post was properly used here as an agent by the Defendants in sending their letter of the 27th March. The Plaintiffs acted from Buloh Kasap five miles from Segamat which is some 125 miles from Singapore and some 50 miles from Malacca. It is difficult to see how they were ordinarily to communicate if not by post †¦ I hold as Farwell J. did in Bruner v. Moore, that â€Å"the parties in this case contemplate that the post might be used as a means of communicating on all subjects connected with the contract. † In these circumstances it is clear that the sender of the letter is not responsible for any delay in the post I hold, therefore, that the rescission of the policy was effected at the moment that the letter of the 27th March was posted, that is on the 27th March, 1931, and that the policy was non-existent at the date of the fire†. The second mode of communication is via telex or telephone. Communications through the telex and telephone are different from posting and the postal acceptance rule does not apply. They are considered instantaneous communication where parties are regarded to be in each other's presence and is complete only when it is received. It can be seen in the case of Entores Ltd v Miles Far East Corporation [1955] 2 QB 327. In this case, the plaintiffs were an English company and the defendants were an American corporation with agents all over the world, including a Dutch company in Amsterdam. The plaintiffs wished to make a contract with the defendants' Dutch agents for the purchase of copper cathodes from the defendants. A series of communications passed by telex between the plaintiffs and the Dutch company, the material one being a counter-offer made by the plaintiffs on September 8, 1954, and an acceptance of that offer by the Dutch agents on behalf of the defendants received by the plaintiffs in London by telex on September 10, 1954. The plaintiffs later alleged that there had been a breach of contract by the defendants. They applied for leave to serve notice of a writ on the defendants in New York on the ground that the contract was made in England and, therefore, fell within the Rules of the Supreme Court. The defendants contended that the contract was made in Holland. The Court ruled that the communication through telex in this case was instantaneous and the contract was made at the place where acceptance was received, in this case, in London. Denning LJ considered the matter in stages. First is, when a contract is made by post it is clear law throughout the common law countries that the acceptance is complete as soon as the letter is put into the post box, and that is the place where the contract is made. But there is no clear rule about contracts made by telephone or by telex. Second is communications by these means are virtually instantaneous and stand on a different footing. The problem can only be solved by going in stages. Let me first consider a case where two people make a contract by word of mouth in the presence of one another. The communication of telex acceptances was also applied in Brinkibon Ltd v Stuhag Stahl [1983] 2 AC 34, HL. In this case, Brinkibon was a London company that purchased steel from Stahag, a seller based in Austria. Brinkibon sent their acceptance to a Stahag offer by Telex to Vienna. Brinkibon later wanted to issue a writ against Stahag and applied to serve an out of jurisdiction party. They would only be able to do so if the contract had been formed in England. The question at issue was where the contract was formed. The House of Lords held that the contract was made in Vienna. The next mode of communication is acceptance by conduct. In the case of Taylor v Allon [1966] 1 QB 304 , the appellant's motorcar had been insured by an insurance company called â€Å"The Federated Employers Insurance Association Ltd†, the policy expiring on April 5, 1964. He obtained a temporary cover note for 30 days from a new insurance company on April 16. It was found as a fact that on the expiration of the old policy he never intended to renew it with the old insurance company. His old insurance company sent him a temporary cover note for 15 days from April 6. Where parties conduct themselves in a manner which indicates that they consider themselves bound by an agreement between them, a contract will be held to have come into existence. In the case of Woon Yoke Lin v United Estate-Projects Berhad [1998] 4 AMR 4052, the High Court held that the defendants, had accepted the plaintiff's offer to rent a kiosk in Subang Parade which was owned by the defendants. The Court referred to the following five expressions of conduct of the defendants: first, they did not reply within 14 days (the booking form stated that if the plainitif's application was not accepted the deposit would be refunded within 14 days); secondly, they accepted the booking fees and paid this sum into their own account; thirdly, they did not return this sum of money within 14 days as provided in the booking form; fourthly, they could have rejected the tenancy agreement and the money which accompanied it upon receipt of these items, but they kept it; and fifthly, instead of rejecting the plaintiff's offer, they negotiated with the plaintiff to relocate. In EMS Bowe (M) Sdn Bhd v KFC Holdings (M) Bhd & Anor [2000] 1 AMR 677, the plaintiffs submitted a tender for some works to the defendants. Subsequently, the second defendant issued to the plaintiffs a draft letter of award for the works and had also instructed the plaintiffs to order in advance materials for the works. The plaintiffs ordered the materials but the award was given to another contractor. The High Court held that a draft offer acted upon by one party with the knowledge and concurrence of the other party has converted it into a written agreement and thus there was a valid and binding contract in this case. The next mode of acceptance is acceptance by performing conditions stipulated in offer. In Carlill v Carbolic Smoke Ball Co [1892] 2 QB 484; [1893] 1 QB 256, the Court of Appeal held that Mrs Carlill had indicated her acceptance by performing the conditions set out in the advertisement. In this case, Mrs Carlill had contracted influenza after using the smoke balls in the manner specified in the advertisement. The defendants' submission that Mrs Carlill did not inform them of her intention to accept their offer of the reward was rejected by the Court. It was held that Mrs Carlill had accepted the offer by performing the conditions stated in the offer. This mode of acceptance is recognised in s 8 of the Contracts Act that â€Å"performance of the conditions of a proposal †¦ is an acceptance of the proposal†. There is also acceptance by silence. An issue that arises is whether silence can amount to an acceptance. In Fraser v Everett (1899) 2 SLJ 81; (1889) 4 Ky 512, the Court held that the defendant who had contracted for the transfer of scrip was entitled to obtain what he had bargained for and could not be compelled to accept a bearer-warrant. It was the plaintiff's contention that, by not replying to the broker's letter of April 25 informing him that the certificates were being exchanged for bearer-warrants, the defendant must be taken to have waived this objection. The Court held that there is rule of law like the saying â€Å"Silence gives consent† applicable to mercantile contracts. In this case, the omission to reply does not constitute a waiver. In the case of Felthouse v Bindiey (1862) 11 CBNS 869; 142 ER 1037, the plaintiff wrote to his nephew offering to buy the nephew's horse and adding that â€Å"If I hear no more about him, I consider the horse is mine at 301. 15s†. The nephew did not reply and no money was paid. The horse remained in the nephew's possession. Six weeks afterwards, the defendant, an auctioneer who was employed by the nephew to sell his farming stock, was directed by the nephew to reserve the horse in question, as it had already been sold, but by mistake had put it up with the rest of the stock and sold it. The plaintiff sued for conversion of the horse and the issue arose whether there was -a concluded contract between the plaintiff and his nephew for the sale of the horse. The Court held that there was none. Although the nephew had intended to sell the horse to the plaintiff at the price at which the plaintiff had named, this was not communicated and silence did not amount to an acceptance. Willes J stated â€Å"It stood an open offer †¦ he nephew in his own mind intended his uncle to have the horse at the price which he had named 15s but he had not communicated such intention to his uncle, or done anything to bind himself †. In the case of Re Selectmove Ltd [1995] 2 All ER 531, CA the Court of Appeal gave its view that silence could be interpreted as acceptance in exceptional circumstances. Peter Gibson LJ stated where the offeree himself indicates that an offer is to be taken as accepted if he does not indicate to the contrary by an ascertainable time, he is undertaking to speak if he does not want an agreement to be concluded. I see no reason in principle why that should not be an exceptional circumstance such that the offer can be accepted by silence. But it is unnecessary to express a concluded view on this point†. Lastly is the mode of acceptance stipulated by the offeror. An offeror may prescribe the mode of acceptance. In Manchester Diocesan Council for Education v Commercial & General Investments Ltd, [1970] 1 WLR241, Buckley J laid guidelines on this matter. If an offeror stipulates by the terms of his offer that it may, or that it shall, be accepted in a particular manner a contract results as soon as the offeree does the stipulated act, whether it has come to the notice of the offeror or not. In such a case the offeror conditionally waives either expressly or by implication the normal requirement that acceptance must be communicated to the offeror to conclude a contract. If an offeror, who by the terms of his offer insists on acceptance in a particular manner, he is entitled to insist that he is not bound unless acceptance is effected or communicated in that precise way, although if the other party communicates his acceptance in some other way, the offeror may by conduct or otherwise waive his right to insist on the prescribed method of acceptance. In the case of in Manchester Diocesan Council of Education was referred to in Yates Building Co Ltd v RJ Pulleyn & Sons (York) Ltd. In this case, the respondents granted the appellants options to purchase three portions of land. The option clause â€Å"shall be exercisable by notice in writing †¦ such notice to be sent by registered or recorded delivery post to the registered office of Pulleyns or the offices of their said solicitors†. However, this notice was sent by ordinary post and not by registered or recorded delivery post. It arrived before the expiry date but the respondents' solicitors replied that the requirement that the notice be sent by registered or recorded delivery post had not been- fulfilled and returned the cheque. Lord Denning MR held that where the offeror has prescribed a particular method of acceptance, but not in terms insisting that only acceptance in that mode shall be binding, acceptance communicated to the offeror by any other mode which is no less advantageous to him will conclude the contract. In conclusion, acceptance should be communicated and there are various modes of communication of an acceptance. This is to ensure that the communication of acceptance is complete and there is a valid contract between two parties.