The Concept of Human Resource Management Assignment

The Concept of Human Resource Management - Assignment Example All these careers relate to the training, developing and managing an aspect of the labor force in an organization. They cater to an extensive application of all the theories and aspects of the human resource knowledge in a broader aspect. Many organizations require a good personal, professional and academic profile in order to recruit people for the position of any skilled job in management designation. For less skilled job or fresh graduates with less or no experience, initial level jobs are offered. On the other hand, those candidates, who possess more experience and have the great qualification, are normally offered managerial level jobs in the human resource field. In this case, the Training and development Specialists are required to have basic knowledge of HR, a bachelor’s degree in the required field, and diplomas or certificates in the fields of training and developing the people. This is also performed by the individuals who are specialists in the field of managing people. Compensation and benefits in this designation are on an average level, while the job may be on a contractual basis only. Compensation and Benefits Manager is the position of a senior or managerial level. This position requires a Master’s degree in the relevant field, an acquaintance of candidates with the subject of accountancy and finance, and a good amount of long experience. The candidates with extra qualification and certificates are usually preferred for this post. The compensation and benefits may vary from organization to organization; however, the managers are normally given higher salary packages and good non-cash benefits too. These include car, cell phones, laptops, and other things.

Desire satisfaction theory Essay Example | Topics and Well Written Essays - 750 words

Desire satisfaction theory - Essay Example It gives weight on the present action time and can cause tension with previous desires and cause regrets in the long run (Shafer-Landau, The ethical life, 2014). It is important to note that pleasure and pain are often inside people’s heads. Thus, the well being of individuals consists in the satisfaction of the people’s preferences and desires. The most important part of desire satisfaction is the overall level of desire achieved in the entire life of an individual. The more desire satisfaction an individual has in his life, the better for them. It is important to note, however, that we desire things because they have independent good on us and not that they are good because they will ultimately satisfy our desire for them. Objective theory of human life suggests things that has items that are neither useful in pleasurable experience or in satisfaction of our desires. For instance, we can consider either knowledge or even friendship. This theory suggests that we take what is self sufficient according to us, as what makes life worthy of any choice and lacking nothing. If, for instance, an individual views that well-being is only existent in friendship and pleasure, another individual can dispute this by showing that knowledge is also something that enables the well-being of individuals. To determine what goes into this list, it is important to rely on reflective judgment or intuition. This makes the theory less satisfactory compared to the other two theories. It is clear from this theory that intuition does not rule out argument. Argument brings individuals to see the truth. Intuitions can also be mistaken thus proving to be a strong defense line for hedonists. The most convincing theories of the three is the hedonism theory. It state that individuals always acts in pursuit of what their minds think will give them the greatest pleasure over pain. Human beings, in this theory, have been given two choices

Disney World Essay Example for Free

Disney World Essay Looking out the window of the airplane as we landed in Orlando, Florida, I felt anticipation, excitement, and exhaustion. It was July 2003 and we were on a family vacation to Walt Disney World. The plane had departed from Philadelphia International Airport at 8 a.m. My parents slept soundly and my younger brother and sister were so excited because like me, it was their first trip to Disney World as well, that they couldn’t even sit still on the plane. Soon, we would all be experiencing the thrill of the Magic Kingdom. My siblings could barely contain their enthusiasm as we drove in our rented Ford minivan to the hotel. After freshening up at the hotel, all five of us climbed into the minivan and headed to Walt Disney World. After maneuvering through a maze of on ramps and off ramps, we were finally at the Magic Kingdom. By the time we were actually inside the theme park, it was lunch time so we decided to eat first before going on our adventures. We were told there were some very nice restaurants outside the Magic Kingdom, a boat ride away; but since my siblings and I were so eager to go on the rides, my parents decided to go with fast food within the theme park. The greatest disappointment of the day was the missing rides. Hannahs favorite ride is Alice in Wonderland; she can and has ridden it ten times in a row at Disneyland. It doesnt exist at the Magic Kingdom. Megans favorite Disneyland ride was also absent, Roger Rabbits Cartoon spin. After all the anticipation, to have the two rides which mattered most to the twins missing, was quite a let down. We couldnt find Indiana Jones or Star Tours, either, so Bill asked an employee about the missing rides. It turns out, you can experience those movie type rides at Disneys MGM studios, for a separate admission price. We were stunned. Bill and I found our mounting discontent compounded by the physical discomfort we felt standing in lines in 90-degree temperatures with 90% humidity. Disneyland with its California location has dry, comfortable weather most of the year. Disneyland is also blessed with a wonderful sea breeze during the hot summers. The Magic Kingdom is located inland with muggy, hot conditions year round. We felt the Magic Kingdom was a waste of time and money. Disneyland is far superior to the Magic Kingdom. I think it was insulting to the customers to charge more in admission than Disneyland and offer significantly less in the form of entertainment. I felt Disney management was greedy. The kids did enjoy themselves, but we adults left the theme park feeling ripped off. As a general rule we never take the kids to Disneyland more than once a year. But so much was missing from the Magic Kingdom Experience; we took them three months later to Disneyland and had a great time. On the first day in Disney World, my dad and I went on all of the Mountain rides like Splash Mountain, Thunder Mountain, and Space Mountain. My favorite was Space Mountain because the ride is inside, and there are no lights so you cannot see at all. I also won a stuffed dog at a game stand.

Solutions to Sustain Freshwater Essay -- Water Scarcity Environment

Would it be possible for humans to live without water? The answer is no because fifty percent of water is inside human bodies. In other words, water supports human lives, so every person is supposed to drink at least two litres of water everyday because it predominantly prevents them from being dehydrated. In terms of being the priceless resource, water is used in many fields such as agriculture, industry, business and so on. All preliminary products are comprised of water. Due to the abundance of water, most people seem not to be concerned about the way they consume this crucial resource. For example, in some countries, there are no dirty water treatment systems practising, and everyone can use water as much as they can as the price of water is cheap, too. However, in some countries, they lack water to access regularly and need to do trade with others in exchange for water. Also, Rogers (2008) notes, â€Å"that the problem is well-known makes it no less disturbing: today one out of six people, more than a billion, suffer inadequate access to safe freshwater† (As in New Delhi, para.3). There is no limit of the use of freshwater between one country to another, and it depends on the place people live. Even though there is a lot of freshwater available on the earth, we, people, should be worried about the proper water consumption. In order to thwart the water crisis from occurring one day, we should reverse our trend of using water by desalinating seawater, recycling waste water and reducing the unnecessary demand of water. The first solution to deal with the problem of water scarcity is to desalinate seawater. Getting freshwater from the sea is taken into account because seawater is much more than freshwater in reality. As Villiers (19... ...hwater is vital for humans to survive, but they should be more concerned about the problems of water scarcity that can happen in the future. Everyone should start to adapt these solutions such as desalinating seawater, recycling waste water and reducing water demands in order to maximize the fact that there is still the abundance of freshwater to use in a long time. Works Cited Reimold, R. J. (1998). Watershed Management: Practice, Policies, and Coordination. NY: R. R. Donnelley & Sons Company. Rogers, P. (2008, August). Facing the Freshwater Crisis. Retrieved November 19, 2009, from http://www.scientificamerican.com/article.cfm?id=facing-the-freshwater-crisis&page=5 Thomson, S. A. (1999). Water Use, Management, and Planning in the United States. Toronto: ACADEMIC PRESS. Valliers, M. D. (1999). Water. San Diego: Stoddart Publishing Co. Limited.

Discrimination Model of Supervision Essay

School counseling is a complex and demanding component of the counseling profession. With an increase of social and emotional stressors, children and youth of today face numerous challenges. These challenges ultimately affect children in school. With an increase of suicides, drug abuse, gang involvement, and violence amongst youth, a high demand for school counseling supervision is needed (Henderson, 1994). Parents and teachers often turn to school counselors for guidance in helping troubled youth. Effective supervision is a benefit for novice as well as experienced school counselors. However, there is a lack of supervision in school counseling in comparison to clinical counseling (Wood & Rayle, 2006). Duties of school counselors have increasingly become much more vast due to cost reduction in education, retirement, increase in student enrollment, and an increase in societal issues such as the economic recession. Many novice and experienced school counselors are facing many more problems in the schools today than ever before. The lack of qualified supervision provided to school counselors force those in the profession to rely on self judgment, consultation, and having ethical knowledge about certain situations that may arise (Henderson, 1994). A study conducted by Wiggins (1993) found â€Å"more than 28% of the total group of experienced counselor participants were independently rated as low in effectiveness, 10 years previously, they were still rated in that manner and still employed as counselors† (p. 382). This study reinforced the urgency in the need for supervision for school counselors. If an effective supervision model was put in place, surely after 10 years, an improvement in performance by these experienced counselors would have been documented. According Herlihy and Corey (1996), the ACA Code of Ethics stated school  counselors have a responsibility to monitor their effectiveness, seeking supervision when appropriate. Despite this mandate, an enormous majority of professional school counselors are not involved in any clinical supervision once they are employed as a school counselor. Luke and Bernard (2006) proposed â€Å"using a 3 (focus of supervision) x 3 (supervisor role) x 4 (CSCP domain) matrix for an effective school counseling supervision model which is described as an extension of Bernard’s (1979, 1997) Discrimination Model† (p. 283). The discrimination model was initially created as a teaching model for use with apprentice supervisors. It is a theoretical model and is based on technical eclecticism. The discrimination model focuses on three separate foci of the supervisee’s competence: intervention skills; conceptualization skills; and personalization skills. Three supervisory roles are also a focus: teacher, counselor and consultant (Ladany & Bradley, 2010). The school counselor model of supervision with the discrimination model is the chosen model employed for my school counselor supervision practice. Intervention, conceptualization, and personalization skills are the three identified areas of focus (Ladany & Bradley, 2010). Intervention skills are the observable counselor behaviors and activities that the supervisee utilizes in the counseling relationship. Such skills are described as everything from a simple head nod, greeting of the client, to how the supervisee utilizes empathy and other counseling skills. The next area of focus, conceptualization skills include the counselor’s ability to choose an appropriate intervention, to make sense of what a client is presenting, to find and organize client themes, and to establish process and outcome goals. Finally, personalization skills are observed by the supervisor and focus on the individuality of the supervisee. Personalization skills include the personal style and chosen theoretical approach to counseling by the trainee, which includes personality, cultural background, countertransference, and the connection with clients served (Ladany & Bradley, 2010). Although some conceptualization and personalization skills may be observed directly, they are more often interpreted by the supervisor and initially require discourse between counselor and supervisor to become clear (Luke & Bernard, 2006). The supervisor’s roles consist of three areas of focal point. They include that of a teacher, counselor, and consultant. The role of a teacher by the supervisor includes the supervisor providing instruction, modeling, giving feedback, and conducting evaluation to assist the trainee in developing growth (Ladany & Bradley, 2010). The supervisor employing the role of a counselor involves the supervisor asking supervisees to reflect on an activity, on their thoughts, or on their internal reality. When supervisors adopt this role, they are not telling supervisees how to proceed; rather, they are assisting the supervisee to take advantage of a critical moment for reflection (Luke & Bernard, 2006). Lastly the supervisor serves as a consultant. In this role the supervisor and supervisee collaborate and share responsibility for the supervisee’s growth. The supervisor acts as a resource and encourages the supervisee to trust their own thoughts, insights, and feelings in their work (Luke & Bernard, 2006). The extension of the discrimination model to better adapt to the needs of school counseling supervision incorporates four domains: large group guidance; responsive counseling and consultation; individual advisement; and programmatic planning, coordination, and evaluation, also known as systems support (Gysbers & Henderson, 2001). These four domains are identified by the American School Counselor Association as the key components of an effective comprehensive school counseling program. Implementation of the discrimination model of supervision begins with the incorporation of the four domains of the comprehensive school counseling program. First, the supervisor identifies which of the four domains or a combination of domains will be the focus of supervision. When examining the three major areas of focus of the discrimination model, an additional set of skills are reviewed as it relates to intervention, conceptualization, and personalization skills (Luke & Bernard, 2006). When observing the use of intervention skills in counseling and consultation; classroom guidance skills, conduction of a needs assessment, and the ability to coordinate initiatives for staff would be additional focus during supervision. Similarly, conceptualization skills would include the supervisee’s  understanding of the relationship among various activities conducted by school counselors, planning a school wide function, deciding which components would be most helpful for a career day, developing a plan for evaluation of services, and choosing a developmentally appropriate classroom intervention. Finally, supervisee personalization skills would include how novice school counselors conduct themselves in a variety of contexts that is not limited to just individual counseling, such as leading large groups and asserting themselves in advocacy situations (Luke & Bernard, 2006). The implementation of the discrimination model of supervision in a school setting for novice school counselors mirrors the same frame work that is used for supervising clinical work but extends the focus of supervision to include the intervention, conceptualization, and personalization skills that relate directly to the four dimensions of a successful comprehensive school counseling program. Supervisors’ roles also expand using the discrimination model of supervision in school counseling. Supervisors use the four dimensions of the comprehensive school counseling program to assist with the development in particular skills not only in counseling interventions but also in advising sessions and negotiations with parents and school administrators. Supervisors assist supervisees in reflections and feelings about district-sponsored mandated programs and how these thoughts and feelings impact their performance (Luke & Bernard, 2006). Supervisors utilize all roles as teacher, counselor, and consultant and may need to change focus depending on the intervention and skills being developed. In conclusion, this extension of the discrimination model of supervision for school counselors prove to provide beneficial guidance and assistance to novice school counselor professionals. This model of supervision helps to combine the counseling and therapy focus seen mostly in clinical supervision with the requirements of school counseling skills needed to operate an effective comprehensive school counseling program. References Gysbers, N. & Henderson, P. (2001). Comprehensive guidance and counseling programs: A rich history and a bright future. Professional School Counseling, 4, 246-256. Henderson, P. (1994). Supervision of school counselors. ERIC Digest. Retrieved from ERIC Database. (ED372353). Herlihy, B. & Corey, G. (1996). ACA ethical standards casebook 5th ed. Alexandria, VA: American Counseling Association. Ladany, N. & Bradley, L. (2010). Counselor supervision 4th ed. New York, NY: Routledge, Taylor & Francis Group. Luke, M. & Bernard, J. (2006). The school counseling supervision model: An extension of the discrimination model. Counselor Education and Supervision, 46(4), 282-295. Wiggins, J. D. (1993). A 10-year follow-up of counselors rated high, average, or low in effectiveness. The School Counselor, 40, 380-383. Wood, C. & Rayle, A. (2006). A model of school counseling supervision: The goals, functions, roles, and systems model. Counselor Education & Supervision, 45(4), 253-266.

The Drinking Age Should Be Lowered - 2353 Words

Drinking Age Over the years the drinking age or the drinking laws have been questioned and changed many times. For a few years now more recently question being, should the drinking age be lowered to eighteen? Or why shouldn’t it? In the United States, binge drinking has been a big problem. Its one of the top causes for traffic tragedies as well as other health issues that come along with it, especially among college students. However since the drinking age has changed from being 18 to 21 there has not been a change and or a decrease in deaths due to drunk driving accidents, suicide, homicide or delinquency. The drinking age should be lowered to eighteen because in the United States, eighteen is the age of adulthood and your mature enough to make these kinds of decisions. After fourteen years of the national Prohibition, it finally came to an end in 1933, meaning you had to be twenty-one to buy or consume alcohol at this time. In 1972 Iowa lowered there drinking age to nineteen after decades of it being the same post prohibition. A year later Iowa lowers there drinking age once again down to eighteen years old, and also businesses are allowed the sales of alcohol on Sundays. Once again Iowa decides to rise their drinking age eight years later to nineteen years old, but allowing individuals born on or before June 30, 1960 to be grandfathered in. And lastly on July 1, 1986, Iowa’s legal drinking age is raised to twenty-one and remains until this day today due to PresidentShow MoreRelatedShould The Drinking Age Be Lowered?995 Words   |  4 Pages Should the legal drinking age be lowered to age 18? Recently people have been debating whether If the drinking age should be lowered to 18. Some people think 18 is a better age but others think it’s outrageous to lower the drinking age to 18. After much reading and observing, I myself think the drinking age should be kept at 21 years old,because young adults who drink while they re underage make po or decisions and majority of the young adults are in college lacking in classes. The legal drinkingRead MoreShould The Drinking Age Be Lowered?853 Words   |  4 Pagesactivities around their friends to feel like they are a part of the team. Many people often wonder if the court of law stepped in and changed the age of drinking would this help the case of underage drinking. This proposed law would lower the drinking age to make the teenagers less rebellious and allow them to feel more like adults. If the drinking age were to be lowered then teenagers would feel as if they didn’t have to drink every day because they wouldn’t have to wonder when this opportunity will happenRead MoreShould The Drinking Age Be Lowered?875 Words   |  4 Pages Should the Drinking Age Be Lowered? Should the legal drinking age be lowered to age 18? Recently people have been debating whether If the drinking age should be lowered to 18. Some people think 18 is a better age but others think it’s outrageous to lower the drinking age to 18. After much reading and observing, I myself think the drinking age should be kept at 21 years old,because young adults who drink while they re underage make poor decisions and majority of the young adults are in collegeRead MoreThe Drinking Age Should Not Be Lowered1135 Words   |  5 Pages In today’s society, underage drinking is seen all around us. It is in TV shows, movies, schools, and even in our own communities. Although it may be understood as something we are not supposed to do, many of these shows do not depict the real issues that can come from drinking under age. While only 11% of the alcohol sold in America is consumed by those under the age of twenty-one, it is still a horrific, nationwide problem. Alc ohol is a drug that can make you do things you would neverRead MoreThe Drinking Age Should Not Be Lowered1705 Words   |  7 Pagespassed The National Minimum Drinking Age Act of 1984 which enforces the legal drinking age and purchasing of alcohol in the United States to be twenty-one. Since then, the debated idea of whether or not the drinking age should be lowered to eighteen has been an ongoing topic for decades. Alcoholism affects many people in the United States but promoting it at such young age would not be such a great idea for the youths in today’s society.The drinking age should not be lowered due to the fact that itRead MoreShould The Drinking Age Be Lowered? Essay2027 Words   |  9 PagesShould The Drinking Age Be Lowered? One of the major problems today in United States society is the amount of people in college who are drinking while underage. Every day on college campuses we see rebellious young adults disobey the law and drink alcohol under the age of 21. How would things be different if the drinking age was lowered? Would college students abuse it or is it a good idea? Many people believe the drinking age should be kept where it is now based on statistics. I feel the drinkingRead MoreShould The Drinking Age Be Lowered?994 Words   |  4 PagesShould the Drinking Age Be Lowered? Approximately 2 out of every 3 high school students have drank to the point of getting intoxicated (binge drink), in more than one occasion (Centers for Disease and Control Prevention [CDC], n.d.). Binge drinking has become increasingly common for youth under the minimum legal drinking age, making it increasingly dangerous because of the lack of supervision that young adults have that can consequently, lead to death because of fear of the law (Bonnie O’ConnellRead MoreThe Drinking Age Should Not Be Lowered1639 Words   |  7 PagesMost people would concur that alcohol should not be given to teenagers. Despite the fact that we concede to this essential truth, underage drinking is still a noteworthy issue in our nation. Since adolescents need development and information with regards to liquor, they put themselves, as well as others in incredible danger when they decide to consume. Regardless of the risk, there are individuals out there who believe that the drinking age should be lowered. However, their argument is weak, andRead MoreThe Drinking Age Should Be Lowered1599 Words   |  7 Pagesmany years is whether the drinking age should be lowered to eighteen years old, as opposed to where it is now, at twenty one. Some argue that at age eighteen, a person is legally an adult and able to go to war, vote, and partake in other adult activities. If they are an adult at this age, why are they unable to legally drink alcohol? There are numerous reasons why drinking is unsafe for those under twenty one. The drinking age is set at age twenty one for a reason, and should stay that way. Some statesRead MoreDrinking Age Should Be Lowered1039 Words   |  5 Pages2017 Drinking age is already dangerous as is In recent discussions of the drinking age limit, people have always said that the drinking age limit should be lowered. Some may argue that alcohol is not bad and that it can actually be beneficially. Many people would want the drinking age limit to be lowered so that it is legal for young adults to drink. If the drinking age limit were to be lowered there would be a drastic difference in society. In my perspective I will argue that the drinking age limit

Financial Analysis of Bevan Industries

Financial Analysis of Bevan Industries Bevan Industries’ current cost of capital From the given information, the cost of capital for Bevan Industries comprises of the cost of debt, the cost of preferred stock, and the cost of common stock. A combination of all these three components constitutes the current cost of capital of the firm. This is also known as the firm’s Weighted Average Cost of Capital (WACC). Discussed hereunder is the step by step calculation of Bevan Industries’ current cost of capital (Barber, 2004). Cost of Debt (Cd) Cd = I (1 TR) Where I is the Interest Rate on Debt TR is the Tax Rate Cd = {(30,000,000 X 0.06) / 25,000,000} X (1 – 0.28) = 0.072 X 0.72 = 0.05184 = 5.184% Cost of Common Stock (Ccs) Based on the given information, the cost of common stock is calculated using the formula Ccs = Cd + risk premium rf = (20 X 8) / 160 = 1 (rf is the risk free rate) Ccs = 5.184 + 0.75(1) = 5.934%. Cost of Preferred Stock (Cps) Cps = {preferred stock dividend/ market price of preferred stock (1 – flotation cost)} In this case, there is no flotation cost, thus = (0.04 X 100) / 20 = 20% Weighted Average Cost of Capital (WACC) is given by the sum of the above components. WACC = Cd + Ccs + Cps = 5.184% + 5.934% + 20% = 31.118%. 2. The new financial requirement The working capital falls by about 15m, while the additional investment costs 75m. Total additional cost = 75m 15m = 60m. From the initial conditions, the total investment is given by 30m + 100m + 160m = 290m Total investment = 290m 60m = 230m. 3.The three proposed financing options Weighted Average Cost of Capital (WACC) can be found using the formula below (Barber, 2004). WACC = (Md/V) X k (1-T) + (Mp/V) X {Dp/Pp(1-Fp)} + (Mc/V) X {g + Dc(1+g) /Pc(1-Fc)} Where V is the firm’s total value given by the sum of the debt, the preferred stock and the Common stock. Md is the market value of the debt; Mp is the market value of the preferred stock; and Mc is the market value of the Common stock. k is the current market interest rate; and T is the tax rate. Dp is the annual dividends for the preferred shares; Pp is the market price of the preferred shares; and Fp the flotation costs of preferred shares. Dc, Pc, and Fc are the dividend, market price, and flotation costs of common stock respectively. First option (debt) Cost of debt = {(100m X 0.06)/230m} = 2.6% Second option (common stock) Cost of Common stock = 100m/230m = 43.48% Third option (Preferred stock) Cost of preferred stock = 100m/230 = 43.48% Weighted Average Cost of Capital is therefore given by the sum of the above three components WACC = 2.6% + 43.48% +43.48% = 89.56%. The advantages and disadvantage of each of the proposals made by the bankers From the bankers’ pieces of advice to Phil Bevan, three basic financing opportunities are presented. Basically, he is faced with a dilemma of either considering Common shares stock, preferred stock or debt financing to aid stabilize the business. However, before a decision is made, he should be in a position to understand the cost associated with each. This implies that he will scrutinize each proposal’s merits and demerits, but with cost of the capital, flexibility, risk the proposal is associated with, control and timing as the basic guidelines. Capital management definitely guides business owners to attain sole objective of an optimal capital structure (Dewatripont and Tirole, 1994). For instance, cost of capital is a cornerstone for measuring the profitability’s of varied investments (Harris and Raviv, 1991). It is thus essential to identify the merits and demerits, with reasons, of each proposal before a recommendation is made. This is discussed as under. Debt Issue Issuing corporate debt is one method of financing different business activities. These activities encompass business expansion or need to carry out research and development. An organization’s debt is signified by bonds. Bonds are future instruments sold to the willing investors. Phil Bevan is likely benefit from accepting Hiram J. Pipesucker’s proposal of debt financing in the following ways. Interest payments are tax deductible The interest charged on debt issued is tax allowable. This implies that its cost is likely to be cheaper as compared to other sources. Often, when an organization issues stock, it pays taxes on the income generated. This leads to a higher liability in form of tax to be paid (Harris and Raviv, 1991). When debt is issued, however, interest is paid to debt holders. Interest has to be paid to the bondholders annually. Debt issue thus has an advantage of due to the fact that the interest paid is tax-deductible. This generally translates to a larger savings in form of tax to be paid by the business to the bondholders. The allowable tax reduces interests to be paid hence increasing profitability. Debt issue avoids dilution of earnings per share or control within the business Debt issue does not interfere with the control of the business, i.e. it at all times avoids the dilution of earnings per share. If Phil Bevan adopts the proposal of issuing debts to raise its capital, he shall have avoided a likelihood of change of control or ownership. It therefore presents the owner with an opportunity to maintain its control as the earnings per share is maintained and not diluted. Long term financing approach Debts issue is a long term approach to raising finances. If Phil Bevan is for the opinion that he invests in a project with duration more than 20 years from beginning to the end, issue bond or debt is the best option to for the business to obtain long funding. On this premise, if he gets a loan from the financial institution, say a bank, the repayment terms and the duration of the loan will be optimally determined by the bank. Besides, Phil Bevan is privileged to choose the terms and the time period of bond maturity. The maturity date is such a time he is to pay back bondholders the principal amount. The date to maturity is always a long term period. Debt issue cost is fixed and the amount of principal repaid does not change overtime Debt issue is also advantageous due to the fact that the principal amount does not change overtime but remain fixed until the date of maturity (Heinkel and Zechner, 1990). This is beneficial as the owners can plan optimally to repay the principal before the maturity date reaches. The repayment terms are usually better on new debt issues than when compared business loans. Lower level of returns to the investors Usually, debts issue presents a lower rate of return to the investors as opposed to the common stock. This implies that if Phil Bevan considers this proposal, it shall have reduced to the amount to be paid to the investors hence profitability. However, debts issue has the following demerits to a business when used as a source of financing. Adds more risk to the business If Phil Bevan considers the proposal of debts issue, he may place the business in a risky position. This is due the fact that debt issue has restrictions on the limit of how much debt to be used. Basically, it presents a frontier as to how much debt can be used to finance the business. It is worth noting that an excess use of debt may plunge the business into bankruptcy. Compulsory maturity date Debts issue as source of finance has as well a disadvantage maturity date. This implies that the capital invested must perform and provide returns faster enough and this return must be passed over to the investors. It carries fixed charges Regardless whether a business has profitable cash flows or not, a fixed charge is imposed to the business. This may plunge a business into financial crisis in events that the fixed charged cannot be met due to lack of earnings. Common stock and retained earnings The cost of common stock and retained earnings is the rate of return an investor requires to make demands to make a common stock investment in the business. As opposed to debts issue, it does not generate tax benefits due to the fact that dividends are paid after taxes (Heinkel and Zechner, 1990). If Phil Bevan adopts Rollo Strauss proposal to invest in common stock, he is likely to experience the following benefits: Common stock financing is devoted to the business and the intended projects. Those who invest in the business only realize their investment in situation where the business has better earnings or cash flows. This is only in an event of market flotation or a sale to fresh investors. There is the advantage of skills that come along with equity finance. For instance, angel investors and venture capitalists do come into the business with valuable management skills, acquaintances and knowledge that improve the business performance. This implies that Phil Bevan is likely to benefit from investors strategic decisions and decision making. Common stock financing does not entail fixed payments When a business uses common stock as source of finance, the fixed payments demanded by investors cease to exist. In other words, it implies that dividends are only to the investors when earnings are available. As opposed to the debts issue where payments have been made regardless of presence of cash flows or not, common stock financing has an advantage of varying payments. Payment can for example be made when the business makes better earnings. Lastly, the invested capital is not being repaid. As opposed to the debts issue where the principal has to be repaid fully after the maturity period, common stock is beneficial to a business due to a reason that it has no maturity date on the securities and thus the invested capital can be necessarily not be refunded. The finance is there to stay in the business. Common stock financing, however, have the following disadvantages to a business which uses it as a source of finance. Dividend payments to shareholders are not tax deductible Often, when an organization issues stock, it pays taxes on the income generated. This leads to a higher liability in form of tax to be paid. On the other hand, when debt is issued, interest is paid to debt holders. Interest has to be paid to the bondholders annually. Debt issue thus has an advantage of due to the fact that the interest paid is tax-deductible (Harris and Raviv, 1996). This generally translates to a larger savings in form of tax to be paid by the business to the bondholders. The allowable tax reduces interests to be paid hence increasing profitability. This however is not applicable to the issue of stock. This signifies that it may prove expensive for the business. This makes its issuance cost higher than that that of debt. Dilutes the earnings per share to shareholders If Phil Bevan adopts the proposal of issuing stocks to raise its capital, he should be prepared for change of control or ownership. It therefore presents the owner with an opportunity of not being able to maintain business control as the earnings per share is diluted. It is time consuming and costly in the long run Issue of stock is often characterized with unnecessary procedures that make it appear demanding. It is always demanding, costly and takes a lot of time to fully effect. Venture capitalists for instance would demand to know the background of the business which many businesses are not for as they can always source for funds without the scrutiny. Preference stock Barry Nicebloke presents Phil Bevan with the proposal of using preferred stock to finance his business. This is a special equity security, having both properties of an equity and debt instrument. Often, they have no voting rights but do carry dividends. It presents a business with the following advantages when used as source of finance (Myers and Majluf, 1984). Avoids dilution of the earnings per share to shareholders Some forms of preferred stock issue do not interfere with the control of the business, i.e. it at all times avoids the dilution of earnings per share. If Phil Bevan adopts the proposal of issuing preferred stock to raise its capital, he shall have avoided a likelihood of change of control or ownership. It therefore presents the owner with an opportunity to maintain its control as the earnings per share is maintained and not diluted. He can thus make strategic decisions that affect the business for success. Preferred stock does not carry fixed charges A fixed charge is imposed to the business depending as to whether the business makes better earnings or not. Dividends are often marked as a percentage of a par value and preference shares dividend can at times be negotiated as floating. The major disadvantage of preferred stock is that interest payable is not tax deductible (Myers and Majluf, 1984). The interest charged on preferred stock issued is tax allowable. This implies that its cost is likely to be cheaper as compared to other sources. Often, when an organization issues debt, it pays taxes on the income generated. This leads to a higher liability in form of tax to be paid. This generally translates to a larger savings in form of tax to be paid by the business to the bondholders. The allowable tax reduces interests to be paid hence increasing profitability. This however is not applicable to the preferred stock issuance. From the presentation above, Phil Bevan should accept Hiram J. Pipesucker’s proposal which is about using debts issue as source of finance. This is basically applicable in this case due to the fact that this source of financing enables him benefit from benefits of tax allowable on interest’s payments, assured level of control of his business without external disturbance and due to the reason that it presents lower returns to the investors. Debt financing is thus recommended. Assessing whether the advice given by each of the bankers is in the best interests of Bevan Industries and why such advice should be treated with caution. Consideration on whether to accept the proposals given by bankers should be made to the flexibility, timeliness and cost of each proposal. Besides these, the business’ economic conditions, market conditions, operating conditions and financial conditions presented by each proposal should be checked and scrutinized. For the Bevan Industries, Phil Bevan, the CFO, is concerned that his capital structure is not as efficient as it might be. In particular, he is concerned about the amount of the business funded by short term debt and that his overall gearing level is quite low. This scenario presents him with different opportunities. The proposal of debts issue might be of weight but is disqualified forthright. This is because, as per the business needs, debts issue is applicable for long term financing but Phil Bevan is concerned about the amount of the business funded by short term debt. Debts issue proposal is not appropriate as it results in a more business financial risk. Phil Bevan is not ready to take the risk. Current levels of exceptional debt will impact on the amount of finance raised. Higher levels of debt as well as the preferred stock will result in wider variations to earnings per share. This is because they come forth with higher fixed obligations that must be paid. For instance, he must be ready to pay the interest to debt holders and fixed dividends to preferred stock holders. He is thus likely to incur more financial risks as opposed to his desired need to improve short term debt and balancing gearing ratio. On the other hand a proposal to undertake common stock issue may be applied. However, it as well has effect of earnings per share on the business or control influence. Due to the fact that Phil Bevan is concerned with the control level of the business, if he goes for this proposal, he is deemed to diluting the control level which he is not for. Reference Barber, J. R., 2004. â€Å"Cost of Capital with Flotation Costs.† Quarterly Journal of Business and Economics, Vol. 43, 2004. Retrieved at http://www.questia.com/googleScholar.qst?docId=5009214076. Dewatripont, M., and J. Tirole, 1994, â€Å"A theory of debt and equity: diversity of securities and manager-shareholder congruence,† Quarterly Journal of Economics 109, 1027-1054. Harris, M., and Raviv, A., 1991. â€Å"The theory of capital structure,† Journal of Finance 46, 297-355. Harris, M., and Raviv, A., 1996. â€Å"The capital budgeting process: incentives and information,† Journal of Finance 51, 1139-1174. Hart, 1995. Firms, Contracts, and Financial Structure, Clarendon Press, Oxford. Heinkel, R. Zechner, J. (1990), The Role of Debt and Preferred Stock as a Solution to Adverse Investment Incentives, Journal of Financial and Quantitative Analysis 25 (1): 1–24 [p. 2] Jensen, M., and W. Meckling., 1976. â€Å"Theory of the firm: managerial behavior, agency costs and ownership structure,† Journal of Financial Economics 3, 305-360. Kieso, D. E., Weygandt, J. J., and Warfield, T. D., 2007. Intermediate Accounting (12th ed.), New York: John Wiley Sons, p.  738 Modigliani, F., and Miller, M., 1958. â€Å"The cost of capital, corporation finance, and the theory of investment,† American Economic Review 48, 261-297. Myers, S., and Majluf, N., 1984. â€Å"Corporate financing and investment decisions when firms have information that investors do not have,† Journal of Financial Economics 13, 187-221. Rosenbaum, J., and Joshua, P., 2009. Investment Banking: Valuation, Leveraged Buyouts, and Mergers Acquisitions. Hoboken, NJ: John Wiley Sons. Scharfstein, D., and Stein, J., 2000. â€Å"The dark side of internal capital markets: divisional rent seeking and inefficient investment,† Journal of Finance 55, 2537-2564. Stein, J., 1997. â€Å"Internal capital markets and the competition for corporate resources,† Journal of Finance 52, 111-133. Subrahmanyam, A., and Titman, S., 1999. â€Å"The going-public decision and the development of financial markets,† Journal of Finance 54, 1045-1082. Tirole., 2006. The Theory of Corporate Finance, Princeton University Press. Yee, K. K., 2000. Aggregation, Dividend Irrelevancy, and Earnings-Value Relations. Contemporary Accounting Research 22 (2): 453–480.