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Personality Theories
Various psychologists have developed theories that explain certain forms of personality. One of most influential set of counseling theories originates from Sigmud Freud- an Australian neurologist. He was the first to propose the psychoanalysis theory; which collectively are referred to as psychodynamic theories.
Although there are different psychodynamic theories, all of them lay emphasis on unconscious desires and motives, and how childhood experiences shape an individual’s personality. In particular, I will explore on Freud’s theory of psychoanalysis and Jungian theory which belongs to the school of psychodynamic theories; and theories from school of humanistic theories including Carl Rogers and Abraham Maslow (Thurn, 2015).
The main tenets
Freud’s theory of psychoanalysis was developed by observing patients. Based on this theories, people’s personalities are established when they attempt to resolve conflicts between the societal demands, aggressive impulses and unconscious demands. The main tenets of this theory are the three levels of consciousness.
These include;
a) consciousness which refers to what a person is thinking and or experiencing at a particular time. For example, the book Myre is reading, the objects that are near her sight, the sounds she can hear, and other experiences such as pain, thirst or hunger at that moment are her conscious;
b) pre-conscious which refers to what one can readily remember (call to consciousness). For example, Myre’s home address, make of her vehicle and other past experiences are in pre-conscious level; and
c) unconscious which refers to desires, thoughts as well as impulses that a person is not aware of. These include desires, feelings and memories that influence each aspect of Myre’s life. For example, she could contain feelings of anger towards her classmate for a bullying incident that she may have experienced at age five (Tobin, 2011).
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According to Freud, the structure of personality comprises of 3 major systems namely Id, ego and super ego. Any action taken by a person or any problem they have arises from the degree of balance and interaction among these three systems. Id operates based on the pleasure principle. It is the primitive unconscious part of personality that is present at birth. It comprises of two instincts that compete. These include the life/sexual instincts and the aggressive instinct. Ego works according to the principle of reality.
It acts as a mediator between the id and superego (Davies, 2009). The superego comprises of conscience and moral ideas which are used to judge the id activities. The defense mechanism of Freud’s theory includes repression, denial, displacement and projection. Repression occurs when one have a threatening idea or memory that makes their emotion blocked consciously or unconsciously.
Projection defense mechanism arises when the repressed feelings are associated with someone else. The displacement defense mechanism is directed towards other people or animals that are not real part of the emotion. Reaction formation occurs when a feeling of belief causes anxiety is transformed into the feeling of belief in an individual’s consciousness. Denial is when a person refuses to admit that she has undergone unpleasant experience that provokes their anxiety (Ferrari, 2016).
The other psychodynamic theory is Jungian theory also known as the analytical psychology. This theory divides unconscious into two different parts. The first part is the personal unconscious which is a reservoir of individual’s information as well as memories that were at one point of life was conscious, but it has been forgotten or suppressed. Jungian theory states that personal unconscious theory is unique to each person. Collective unconscious refers to the deepest level of a person’s psyche which consists of the universal memories, experiences and symbols of humans.
It is the reservoir of experiences that are inherited that appear in stories, myths and dreams. According to this theory, personalities arise not only due to system conflicts but also by individuals future goals and desire to fulfill them. Basically, these psychodynamic theories share a general belief that one must explore the unconscious origins and dynamics. The main challenge of these theories is that it is not possible to disconfirm unconscious motives and they violate falsifiability principles (Steinberg, 2015).
Unlike psychodynamic theories, humanistic theories focus on the goodness of a person and their needs to achieve their full potential. Carl Rogers’s personality theory focuses on the importance of self-actualization in shaping the personalities of a human being. According to this theory, human react to stimuli subjective to their reality, and over a period of time, the person develops a self concept.
He further divided self in to two categories namely the real self and the ideal self. He stated that a patient experiences congruence when thoughts on ideal and real self are similar. Therefore, high congruence leads to greater sense of self concept and a productive life. Conversely, if there are any discrepancies between the ideal and actual selves, the patient experiences incongruence state which results into maladjustment (DeRobertis, 2015).
Rogers’s theory also elevates the importance of unconditional positive regard which is determined by the environmental conditions. Unlike Freud, Rogers described the life based on the principles instead of stage of development. Therefore, a healthy person continues to fulfill their potential and ends up having what is known as a good life. Such kind of people allows their personality and self concept to emanate from experience. Based on this theory, fully functioning person posses several traits including openness, existential lifestyle and have organismic trust. Such people have higher degree of freedom, creativity, and reliability which make their lives rich of experiences.
Maslow’s humanistic theory of personality argues that people attain their full potential by moving their basic needs to reach their self actualization. The humanistic psychologist approached the concept of personality by evaluating on a patients subjective experiences, innate drive and free will towards self actualization. The theory explores ways human needs transform throughout a person’s lifespan and the way they influence their personality development.
The tenets of this theory are his established hierarchy of needs which basically lists human needs from the most basic needs to the most advanced needs of actualization which have been developed inform of a pyramid. Each layer of the pyramid must be attained and mastered before one can move up the pyramid. This process is continuous throughout a person’s lifespan (Himelstein, 2011).
References
DeRobertis, E. (2015). Philosophical-anthropological considerations for an existential-humanistic ecopsychology. The Humanistic Psychologist, 43(4), 323-337. http://dx.doi.org/10.1080/08873267.2014.961637
Himelstein, S. (2011). Engaging the moment with incarcerated youth: An existential–humanistic approach. The Humanistic Psychologist, 39(3), 206-221. http://dx.doi.org/10.1080/08873267.2011.592436
Porucznik, H. (2012). Psychosomatics today. A psychoanalytic perspective. Psychodynamic Practice, 18(1), 137-141. Retrieved from http://dx.doi.org/10.1080/14753634.2012.640167
Ratner, J. (2015). Rollo May and the Search for Being: Implications of May’s Thought for Contemporary Existential-Humanistic Psychotherapy. Journal Of Humanistic Psychology. http://dx.doi.org/10.1177/0022167815613880
Thurn, D. (2015). A review ofClinical Implications of the Psychoanalyst’s Life Experience: When the Personal Becomes Professional. Contemporary Psychoanalysis, 51(3), 562-571. Retrieved from http://dx.doi.org/10.1080/00107530.2014.963459
Tobin, R. (2011). Fixing Freud: The Oedipus Complex in Early Twenty-First Century US American Novels. Psychoanalysis & History, 13(2), 245-264. Retrieved from http://dx.doi.org/10.3366/pah.2011.0091
Tribe, R., & Morrissey, J. (Eds.). (2015). Handbook of professional and ethical practice for psychologists, counsellors and psychotherapists. Routledge.
Welfel, E. R. (2015). Ethics in counseling & psychotherapy. Cengage Learning.
Parahoo, K. (2014). Nursing research: principles, process and issues. Palgrave Macmillan.
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Assisted Reproduction Technology
History of Assisted Reproduction Technology
In July 1983, the first successful human-human transfer of an embryo resulting in pregnancy was announced. Biggers and John report that the procedure took place at the Harbor-UCLA Medical Center under the supervision of Dr. John Buster. Subsequently, the first birth was reported in February 1984. It is estimated that between then and now, about 350,000-50,000 babies have been born following this procedure (Biggers and John 123).
The embryo was transferred from the woman in whom it was developing to another woman to the woman who gave birth 38 weeks after. Henceforth, this was considered milestone breakthrough for women who were infertile (Biggers and John 121). It has given light to embryo donation and the use of human oocyte as an alternative to adoption for these women.
The Uses and Benefits
According to Wagner, embryo transfer or assisted reproduction technology is used for women with infertility challenges such as, blocked and damaged oviducts or those whose fallopian tubes have been removed. Women with ovulation disorders can also take advantage of this technology. As well, it can also be utilized in case of men with male factor infertility (low sperm count or sperm immobility) and persons with genetic disorders (Wagner, Marsden, and Patricia 1028).
Same gender couples and individuals who choose to be single can also use this technology. The benefits that come with freezing of embryos include the ability to store them in case you are at risk of injury or death.it is important for persons who conditions that require medical attention, which affects their fertility (Wagner, Marsden, and Patricia 1028). Freezing of embryos is also beneficial people undergoing sex-change operations. Finally, it gives people a chance to become donors and assist individuals with infertility problems.
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Problems and Risks
The only known problem with embryo transfer surface when a donor who is not registered participates without the consent of Human Fertilization and Embryology Authority (HFEA) clinic. This compromises your health and that of the child because of lack of stringent screening and testing procedures (Wagner, Marsden, and Patricia 1030). Also, it becomes unclear on who is the legal parent of the child as this can allow the donor to take the legality. Furthermore, it will be impossible for this child to have any information of the donor since it will be missing in the HFEA files.
Apart from this, there are also several risks surrounding this technology (Wagner, Marsden, and Patricia 1028). As with other medical processes, fertility medications have side effects, which range from headaches, ovarian hyperstimulation syndrome breath shortness, and fainting. Additional risks include; bleeding and infections during egg retrieval, the chance of multiple pregnancies and associated psychological and emotional stress (Wagner, Marsden, and Patricia 1028).
Society Viewpoints
There are some social aspects outlined by (Schoolcraft et al. 863). Some people, especially in professional settings, are of the opinion that this technology should be left to same gender couples only. In Asian countries, it is only allowed for married couples only (Schoolcraft et al. 866). It widely practiced in European countries while it is prohibited in South America because of religious reasons (Schoolcraft et al. 867). This is because Christians consider this technology immoral. Other people argue that the stress and pain that come with this procedure can make difficult for the parent to bond with the child.
Personal Effect
This technology has no significant effect on me because from my perception people should be given a chance to choose the mode of reproduction they consider most favorable. It is therefore not under my jurisdiction to judge it as wrong or right (Schoolcraft et al. 864). It is, therefore, a matter of individual choice because it only involves the individuals who choose it.
Wagner, Marsden G, and Patricia A St Clair. “Are in-vitro fertilization and embryo transfer of Benefit to all?” The Lancet 334.8670 (2014): 1027-1030. Web. http://www.ncbi.nlm.nih.gov/pubmed/2572751
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Social Media and Networking Sites
Introduction
Social media has been at the forefront of the digital revolution. Social media has created a borderless world and revolutionized communication by helping individuals to share information, photos, videos and other content instantly over the internet.
Background Information
Advancement in technology has led to increased access to the internet and internet-enabled devices such as smartphones and computers. This can be described as the cornerstone of social media, which relies solely on the internet and internet-enabled devices.
Since the advent of social media site, Six Degrees in 1997, numerous social media sites including Facebook, Flickr, YouTube, Twitter, LinkedIn, Pinterest, Instagram, Snapchat, MySpace, Periscope and Meerkat have been developed.
These networks have allowed users to share photos, videos, personal updates and other content online from anywhere across the globe. In this regard, social media has contributed immensely in enhancing seamless communication across the world.
Thesis Statement
Twitter, Facebook, LinkedIn and YouTube as the main social networks have each designed their networks with unique characteristics aimed at enhancing social connections while providing the best user experience.
Discussion
Twitter, Facebook, LinkedIn and YouTube continue to grow immeasurably, as individuals seek convenient avenues to communicate and share information. While most social media networks serve closely related purposes, each has its own unique characteristics. These are discussed below:
Twitter
Twitter’s main purpose is to help individuals connect with what is of interest to them, whether it is friends, celebrities, experts or news agencies.
The post length on Twitter is only 140 characters. This means that the networking site is more concerned about creating interest than providing detailed information.
A user’s connections on tweeter are known as tweeps, while statements posted by users are known as tweets.
To connect with another user and see their updates, one must ‘follow’ them by clicking the follow button.
Hashtag (#) is a prominent and widely used feature on Twitter. The # is used in creating key words used to refer to a specific subject, such that others can follow and contribute to the conversation through the hash tag. Clicking the word with the hashtag, the user can read all posts related to the subject.
Facebook
Introduction
Facebook encourages people to reconnect and find new connections online. Through the use of email, images, instant messaging and video sharing, Facebook allows users to look for family members or long lost friends through their profile.
A Facebook post may consist of a maximum of 63,206 characters, which gives users freedom to express themselves in both short updates and detailed updates to keep their connections informed.
An individual’s connections on Facebook are known as ‘friends’ and can share information, photos and videos on each other’s ‘wall’, which is the individual profile page where account owners can share thoughts, pictures, videos and other content.
To connect with a friend, one is required to make a friend request on the page. The potential friend then receives a notification and decides whether to accept or decline the request
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LinkedIn users link and follow each other through connections.
Users provide personal information including education qualifications, professional qualifications, work experience, current employment details and contact details to allow interested persons to ‘connect’ with them.
LinkedIn allows users to connect to others through people already known to them. Using the ‘Get introduced’ function, users can send messages to current contacts to introduce them to a potential contact.
LinkedIn helps users to obtain information that is highly relevant to them by suggesting groups with relevant information. The ‘Groups You May Like’ makes an analysis of attributes that are similar between members through algorithms and then suggests the groups to members depending on their interests.
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YouTube
YouTube allows video sharing through users’ YouTube accounts, also known as ‘channels’. These may range from short videos to videos that are 11 hours long and a maximum of 128GB.
Advertisement revenue is a prominent feature of YouTube, with advertisements being strategically placed in the most popular videos. By creating interesting or popular video content, users can earn money based on the number of advertisements linked to their content.
YouTube has a ‘Trending’ page, which allows users to find popular and current content as quickly as possible
The popularity of videos is determined by the number of views.
Users often rely on the views and video shares to determine how well their videos were received.
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Conclusion
This discussion is a clear indication of how social media has enhanced interaction between individuals and also enhanced the flow of information.
It is apparent that social media has indeed been instrumental in enabling social and professional connections in the contemporary society.
A discussion of the most popular social media networks being Twitter, Facebook, LinkedIn and YouTube reveals that each social media network is created with a specific objective, and that the various characteristics possessed by these media have enhanced their use and relevance to users.
As technology continues to advance however, it is imperative for social media sites to diversify and allow users to share additional content in order to garner additional users.
As an example, it is notable that technology advancement and availability of high speed internet has enabled live video streaming over social networks. This is a feature that the social media networks discussed above can utilize to enhance connections and attract users.
Social media networks should not be rigid in terms of the content that should be shared by users and they should therefore strive to provide variety and innovation in sharing content.
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How the Definition of Burglary Has Changed From The old Common Laws
According to the old common definition of burglary, it refers to any form of unauthorized entry into another individual’s residence without his or her permission and with bad intentions at night (Herring, 2014). This definition emphasizes on the fact that one is to be considered a burglar, if and only if his or her entrance is strictly into another person’s home, and in this case without authority.
Even though not all burglars are thieves, it is assumed that their intention is always to commit crime (Mawby, 2013). However, the modern day definition differs from the previous one in that; any forced entry without authority during the day also amounts to burglary. The sense in this definition is that; burglary as a crime can also take place in the day and in any building that can house people and not just people’s homes.
An Analysis of Burglar Crimes
In most cases, burglars are people who have previously committed different types of crimes, or are doing it to meet their daily needs or requirements (Wright, R., & Decker, 2016). Most of them may be motivated to participate in burglary in order to acquire drugs, money or simply from peer pressure. Cases of burglary usually have a great impact on the affected people, as a criminal offence that involves forced entry or breakage, most of them are left in fear or psychological torture, and they feel insecure when left alone in their residence or business area (Herring, 2014).
There are two factors that have to be taken into consideration when associating an individual with being a burglar, these are; the ‘mens rea’, which in this case refers to the mental state of the burglar, or in other words, the burglar’s awareness of the fact that he or she could be committing a crime; and the ‘actus Reus’, which again refers to the burglar’s objective when committing the crime, or the motif behind his actions (Herring, 2014). Proving the existence of the above two factors is enough evidence to show that a burglary crime was committed.
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Secondly, although the law classifies burglary as a planned crime, several factors have to be considered while analyzing it (Mawby, 2013). These are; whether different but similar crimes have been committed alongside; or if the burglar committed a different crime after the forced entry.
For instance, burglary with physical violence and threats to the victims is a common crime. In this case, the burglar should be arraigned with two crimes; burglary and assault or depending with the crime committed after the forced entry (Herring, 2014). Nevertheless, a burglar takes time to learn and understand their targets’ routine, as such, there is a lot of stalking of their chosen targets to fully come up with a suitable plan, and this also amounts in a crime.
Since not all burglars are stupid, trends in burglary crimes have changed from the way they occurred before to new styles in this century. Examples of modern day burglar crimes include: non-staff members in a school scenario entering into student residence with intentions of stealing; a student entering into the administrator’s office with the intention to steal her teacher’s purse. Regardless of the fact that such crimes may not necessarily involve forced entry, they still amount to burglarying according to its modern day definition.
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Cash Flow Analysis
Business Analysis Report:
Abstract
This report provides an exhaustive comparative appraisal of the fiscal position, cash flow, performance, and evaluation of Bellway PLC and Redrow PLC. These are two companies that both operate in United Kingdom’s real estate industry. The report sought to answer the following questions: Is Bellway in a better financial position than Redrow? Which company is more profitable for investors between Bellway and Redrow? Which of these two companies is better positioned to exploit the opportunities in its environment? The results indicate that Bellway is better positioned fiscally than Redrow in case an emergency situation comes up. All the same, Redrow is better positioned to exploit the opportunities in its environment than Bellway.
Business analysis report
Introduction
This report provides an in-depth comparative appraisal of the fiscal position, cash flows, performance, and evaluation of two companies that operate within the same industry. In analyzing the main financial statement of the two companies, the researcher uses ratio analysis, vertical analysis, and horizontal/trend analysis. The selected firms are Bellway PLC and Redrow PLC. Both of these companies operate in the United Kingdom’s home construction industry. This appraisal comprises SWOT analysis for both Bellway and Redrow.
The two selected companies are described briefly in the introduction section and a fuller description is found at the Study section. Redrow PLC is an organization that is based in Britain and is involved in residential development. Redrow PLC own’s Harrow Estates, which is focused on property and land solutions (Redrow 2016; Cahill 2012). Bellway PLC is a holding company also based in Britain. It owns subsidiary undertakings and it mainly engages in building houses in Britain (Bellway 2016).
Research questions
Is Bellway in a better financial position than Redrow?
Which company is more profitable for investors between Bellway and Redrow?
Which of these two companies is better positioned to exploit the opportunities in its environment?
Literature Review
The selected companies: Redrow PLC and Bellway PLC
Redrow PLC is a firm that is based in the United Kingdom. It is engaged in residential development. Redrow PLC own’s Harrow Estates, which is focused on property and land solutions (Redrow 2016). Redrow PLC is involved primarily in construction and building of residential properties. It provides its services only within the United Kingdom. Redrow PLC has a land bank of over 12,000 development lots giving the firm about 4-year supply of buildable land, which provides a buffer against abrupt increases in land prices (Redrow 2016).
Bellway PLC is a holding company that is based in the United Kingdom. It owns subsidiary undertakings and it largely engages in contructing houses in the United Kingdom (Bellway 2016). Bellway PLC has quite a few subsidiaries the main one being Bellway Properties Limited. Bellway PLC operates in England, Scotland and Wales only. It does not have operations in Northern Ireland. The land bank owned and controlled by Bellway PLC is roughly 34,070 plots (Bellway 2016).
In the 2015 financial year, Bellway sold in excess of 7,760 houses at an average price of roughly £224,000; about eighty percent of which were sold privately and the remainder being sold as social housing. Bellway PLC gives emphasis to sales volume growth and it frequently buys land particularly at low-cost at locations where it can develop (Bloomberg 2016).
Industry: Home Construction / Real Estate
Bellway PLC and Redrow PLC both operate in the United Kingdom’s home construction industry. This is because both companies are engaged in the construction of buildings: that is, they build and develop houses and homes. They construct and develop houses and homes of different types and sizes for diverse markets (Cave 2015; Lai 2013). The housing market in the United Kingdom has been growing steadily (Willer 2016). This steady growth is largely attributed to the aging UK population which increases demand for property overall (Everett & Duval 2010; Stewart 2013).
The long-term trend for house prices in Britain is upwards, although changes in the prices of houses are very cyclical (Cave 2015; Brennan 2013). In the housing market of the United Kingdom, about 250,000 new homes are needed to be built annually in order to stay abreast of the demand (Bourke 2012; Elliot 2013). Even though the construction sector in general in Britain has slowed down, the homebuilding sub-sector has seen a rise in the construction of new homes (Canocchi 2016; Cunningham 2012; Roxburgh 2011).
SWOT analysis
SWOT – strength, weakness, opportunity and threat – analysis is utilized in evaluating a company’s position and guide strategy going forward. Strengths – these are the qualities which determine a company’s success. Strengths allow an organization to attain its mission. Strengths could be intangible or tangible and include qualities and traits that staff members have as well as their flair which offers the company consistency (Everett 2014). Examples of strengths include no debt, workers who are committed, and huge monetary resources.
Weaknesses – these refer to the qualities which impede the productivity of a company preventing the company from attaining its mission and achieving its full potential. Even so, weaknesses can be controlled and the impact and magnitude of the damage could be decreased. SWOT analysis helps not just to identify the weaknesses of a company, but also provides a chance of reversing those weaknesses (Everett 2014).
Opportunities – there are an extensive range of opportunities present in the environment where the company operates. An organization could always benefit from such opportunities, which could arise out of the market, technology or competition. It is notable that existing opportunities could be the utilization of novel technology, exploiting the company’s untapped resources, and failure of a competitor (Fine 2011).
Threats – these are the elements of vulnerability which could jeopardize the organization’s profitability and reliability. They are unavoidable and cannot be controlled. They have to be addressed so as to find a practicable solution (Pickton & Wright 2014).
Fine (2011) noted that a SWOT analysis is a vital part of the strategic planning process of an organization as offers a good all-round perspective of the forward-looking and current situation of the business. The Weaknesses and Strengths sections provide a look at the current position of the company whereas the Threats and Opportunities sections help in projecting challenges as well as possibilities going forward (Bensoussan 2013). SWOT analysis is a suitable tool for strategic planning.
As a result of the analysis, the business owner would be able to set organizational goals and objectives and obtain a clearer picture for basing his decisions on (Lu 2010). In addition, SWOT analysis helps the business owner to utilize a strategy to match the company’s opportunities and threats, and utilize those strategies to convert the threats and weaknesses of the company into its opportunities and threats (Bensoussan 2013). Although a SWOT analysis allows a business owner to identify and understand important issues that affect the company, SWOT analysis does not essentially provide solutions (Fine 2011).
Ratio Analysis Theory
This theory is relevant to the present research paper. Analysis of fiscal reports necessitates skill of statistical tools, accountancy, and mathematics. There are several fundamental ratios that could help anyone in analyzing an organization’s Profit & Loss Account and Balance Sheet for instance current ratio, provisioning coverage ratio, credit deposits ratio, debtors turnover ratio among others. A wide range of fiscal data could be obtained from Annual Reports, Profit and Loss Account, Audit Report, Balance Sheet, Bank Loan Statement, Bank Account Statement, and Income Tax Return.
Financial Statements
Common fiscal statements include cash flow statement, balance sheet, and income statement, and they are all interconnected. The cash flow statement explains cash outflows as well as cash inflows, and it reveals the amount of money which the business has available on hand, which is reported in the balance sheet also. The income statement is used in describing the way liabilities and assets were utilized in the stated accounting period (Routh 2014).
Every financial statement by themselves only offer a portion of the story of the fiscal condition of the business. When taken together however, the fiscal statements offer a more comprehensive picture (Putra 2015). Potential creditors and stockholders usually analyze the fiscal statements of a business organization and compute several fiscal ratios with the data they contain with the aim of identifying the fiscal weaknesses and strengths of the company and establish whether or not the firm is actually a good investment/credit risk (Kumara 2012). In addition, the fiscal statements of a company are usually utilized by the managers as it aids them in making decisions (Routh 2014).
One particular significant way in which the three fiscal statements are utilized together is in calculating free cash flow (FCF). Investors who are smart prefer business organizations which generate lots of FCFs. This is primarily because it signals the ability of the firm to pay off its debt as well as dividends, facilitate the company’s growth, and buy back stock – all vital undertakings from the perspective of an investor (Routh 2014). Even so, whilst free cash flow is an essential gauge of the health of the business, it actually has its limits; as Lan (2014) pointed out, free cash flow is really not immune to accounting trickery.
Financial Statement Analysis
Financial analysis or financial statement analysis is the process in which the fiscal statements of a company are reviewed in order to make better financial decisions. Financial analysis focuses on analyzing a company’s income statement and balance sheet to interpret the business as well as the company’s fiscal ratios for fiscal forecasting, business evaluation, and even fiscal representations (Grimm & Blazovich 2016).
The main fiscal statements include Statement of Cash Flows, Balance Sheet, and Income Statement (Routh 2014). Financial analysis is a process or technique that involves certain methods for assessing fiscal health, performance, risks, as well as the company’s future prospects.
Financial statement analysis is utilized by many stakeholders including equity and credit investors, decision-makers with the company, the public, and even the government. These different stakeholders have various interests and they apply dissimilar techniques in meeting their needs (Lan 2014). Creditors, for example, want to ensure the principal and interest is paid on the debt securities of the organization whenever due.
Equity investors are interested in the organization’s long-term earnings power and the growth and sustainability of dividend payments. Some of the common financial analysis methods include DuPont analysis, fundamental analysis, vertical and horizontal analysis, as well as the use of financial ratios. To project performance of the future, historical information combined with several adjustments and suppositions to the fiscal information might be utilized.
Methods of financial analysis
Ratio analysis
Financial ratios are essential tools for performing analysis of financial statements quickly. There are 4 different classifications of financial ratios: leverage, activity, profitability, and liquidity ratios. These financial ratios are usually analyzed across competitors within the industry and over time (Routh 2014). In analyzing the financial statement of a company using the ratio analysis method, various types of ratios are used.
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Liquidity Ratios: these are utilized in determining how fast an organization is able to turn its assets into cash in the event that the business faces insolvency or fiscal challenges. In essence, liquidity ratios are a measure of the capacity of an organization to remain in business (Routh 2014). Some of the liquidity ratios include the liquidity index and the current ratio.
Current ratio is used to measure the current assets of an organization against the organization’s current liabilities (Altman 2012). The current ratio is used in measuring the amount of liquidity that is available to pay for liabilities (Lan 2014). It is notable that the current ratio indicates whether or not the corporation is capable of paying off its short-term liabilities during a situation of emergency through liquidating its current assets (Lan 2014).
A low current ratio means that the company might find it difficult to pay its current liabilities within the short run hence it should be investigated more. If the current ratio is less than one for example, it indicates that even when the firm liquidates its entire current assets, it will still not be able to pay off its current liabilities (Routh 2014).
Quick ratio helps to compare the accounts receivable, short-term marketable securities, and the cash to the company’s current liabilities. If quick ratio is 0.55 for example, it means that the firm is only able to cover 55 percent of current liabilities by monetizing accounts receivable, liquidating short-term marketable securities, and utilizing all cash-on-hand (Lan 2014).
Cash ratio is computed as cash and short-term marketable securities divided by organization’s current liabilities. It is worth mentioning that a cash ratio of 0.31 will mean that the firm could only pay off 31 percent of its current liabilities with the use of its short-term marketable securities as well as cash.
Liquidity index is also one of the liquidity ratios although is not very popular. It is used to measure the period of time that is needed for converting assets into cash (Batta, Ganguly & Rosett 2014).
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Activity Ratios: these ratios essentially demonstrate how well the company’s top executives are managing the resources of the organization. Accounts receivable turnover and accounts payable turnover are some of the common activity ratios. They show the period it takes for an organization to get payments and how long it takes for an organization to pay off its accounts payable (Routh 2014). Other activity ratios include sales to working capital ratio, fixed asset turnover ratio, working capital turnover ratio, and inventory turnover ratio.
Profitability Ratios: these are ratios which show how profitable an organization is. The gross profit ratio and the breakeven point are some of the common profitability ratios. The breakeven point is used in computing the amount of money which the organization has to generate in order for it to break even with its start up costs (Knežević, Rakočević & Đurić 2011). The gross profit ratio shows a quick snapshot of the anticipated revenues.
Leverage Ratios: these show how much an organization depends on its debt in funding its operations. The debt-to-equity ratio is a popular leverage ratio utilized in analyzing financial statements (Johnson 2013). The debt-to-equity ratio depicts the degree to which the company’s top executives are willing to utilize debt in funding the company’s operations. It is computed as follows: (Leases + Short-term debt + Long-term debt) / Equity (Lan 2014).
Vertical analysis
Besides ratio analysis, the other method that can be used to analyze financial statements is the use of vertical and horizontal analysis. Vertical analysis, as Lan (2014) pointed out, reiterates every figure in the income statement as a percentage of net sales. Vertical analysis is important as it allows the top managers to understand if expenses such as Cost of Goods Sold (COGS) are very high in comparison to sales (Andrijasevic & Pasic 2014).
In essence, vertical analysis is the proportional analysis of a fiscal statement in which every line item on the fiscal statement is listed as a percentage of another item (Routh 2014). This essentially implies that each line item on the balance sheet is stated as a percentage of total assets whilst on the income statement, each line item is stated as a percentage of gross sales (Teodor & Radu 2013). All in all, vertical analysis brings about common-size fiscal statements. Boyd et al. (2014) noted that common-size income statements present each of the amount in the income statement as a proportion of sales.
This is used to compare ratios and account balances over various periods of time. It can be used, for instance, in comparing a company’s sales in 2012 to the company’s 2013 sales (Boyd et al. 2014).The financial analysis for the two companies is illustrated exhaustively in the Study section. The analysis includes the horizontal/trend analysis, vertical analysis, and ratio analysis (Monea 2013). The horizontal analysis entails comparing fiscal information over a number of reporting periods. Horizontal analysis is therefore the review of the results of several periods of time (Luypaert, Van Caneghem & Van Uytbergen 2016).
Financial statement analysis is important due to several advantages it presents to an organization. Firstly, financial analysis offers an idea to investors about deciding on investing their money in a certain business organization (Damjibhai 2016). Secondly, various regulatory authorities such as IASB could ensure that the business organization is in fact following the necessary accounting standards (Routh 2014).
Therefore, the analysis enables the company to remain compliant (Ednlister 2012). Thirdly, the analysis of financial statements helps government agencies to analyze the taxation that is owed to the company (Beutler 2014). Fourthly, financial statement analysis enables the company to analyze its own performance over a certain period of time (Routh 2014).
References
Altman, EI 2012, ‘Financial ratios, discriminant analysis and the prediction of corporate bankruptcy’, Journal Of Finance, 23, 4, pp. 589-609, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Andrijasevic, M, & Pasic, V 2014, ‘A blueprint of ratio analysis as information basis of corporation financial management’, Problems Of Management In The 21St Century, 9, 2, pp. 117-123, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Barnard, L 2011, ‘bellway jv reaches into barking’, Estates Gazette, 733, p. 04, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Batta, G, Ganguly, A, & Rosett, J 2014, ‘Financial statement recasting and credit risk assessment’, Accounting & Finance, 54, 1, pp. 47-82, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Bensoussan, BE 2013, Analysis without paralysis: 12 tools to make better strategic decisions. Oxford, England: Oxford University Press.
Beutler, IF 2014, ‘What Makes Wealth Grow? A Wealth Sensitive Financial Statement Analysis’, Journal Of Financial Counseling & Planning, 25, 1, pp. 90-104, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Bourke, C 2012, ‘Further losses for major housebuilders’, Estates Gazette, 836, p. 54, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Boyd, K., Epstein, L., Holtzman, M., & Loughran, M 2014, Horizontal and vertical analysis. Coventry, England: John Wiley & Sons.
Brennan, H 2012, ‘NewBuy rates do not reflect scheme’s risk profile, says Redrow’, Money Marketing (Online Edition), p. 5, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Cahill, J 2012, ‘Hammonds partner quits for Redrow in-house role’, Lawyer, 16, 44, p. 3, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Cave, A 2015, Redrow Cuts Exposure to London Values, Daily Telegraph.
Cunningham, D 2012, ‘Bellway appoints Ayres as chief executive’, Estates Gazette, 1232, p. 03, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Damjibhai, SD 2016, ‘Performance Measurement Through Ratio Analysis: The Case of Indian Hotel Company Ltd’, IUP Journal Of Management Research, 15, 1, pp. 30-36, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Ednlister, RO 2012, ‘An empirical test of financial ratio analysis for small business failure prediction’, Journal Of Financial & Quantitative Analysis, 7, 2, pp. 1477-1493, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Elliott, G 2013, ‘Redrow and place of supply’, Accountancy, 125, 1281, p. 138, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Everett, R, & Duval, C 2010, ‘Some considerations for the use of strategic planning models’, Proceedings For The Northeast Region Decision Sciences Institute (NEDSI), pp. 525-530, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Everett, RF 2014, ‘A Crack in the Foundation: Why SWOT Might Be Less Than Effective in Market Sensing Analysis’, Journal Of Marketing & Management, Special 1, pp. 58-78, Business Source Complete, EBSCOhost, viewed 13 July 2016.
Fine, LG 2011, The SWOT Analysis: Using your strength to overcome weaknesses, using opportunities to overcome threats. Coventry, England: SAGE Publications.
Furber, S 2014, ‘Bellway toasts 11.7% NAV rise’, Estates Gazette, 1442, p. 03, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Grimm, S, & Blazovich, J 2016, ‘Developing student competencies: An integrated approach to a financial statement analysis project’, Journal Of Accounting Education, 35, pp. 69-101, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Jagger, S 2015, Redrow Poised To Finalise Pounds 34.5m ICI Land Bank Deal. Daily Telegraph
Johnson, CG 2013, ‘Ratio analysis and the prediction of firm failure’, Journal Of Finance, 25, 5, pp. 1166-1168, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Knežević, S, Rakočević, S, & Đurić, D 2011, ‘Implementation and Restraints of Ratio Analysis of Financial Reports in Financial Decision Making’, Management (1820-0222), 61, pp. 24-31, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Kumara S 2012, ‘Ethic – based management vs corporate misgovernance — new approach to financial statement analysis’, Journal Of Financial Management & Analysis, 25, 2, pp. 29-38, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Lai, S 2013, ‘Redrow Homes Ltd and Another v Bett plc and Another [1998] 1 All ER 385’, Journal Of Financial Crime, 6, 3, p. 252, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Lan, J 2014, Financial ratios for analyzing a company’s strengths and weaknesses. AAII Journal, 3(7):1-13.
Lundholm, R., & Sloan, R 2011, Equity Valuation and Analysis, 2nd edn (McGraw-Hill Irwin, New York, NY).
Luypaert, M, Van Caneghem, T, & Van Uytbergen, S 2016, ‘Financial statement filing lags: An empirical analysis among small firms’, International Small Business Journal, 34, 4, pp. 506-531, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Lu, W 2010, ‘Improved SWOT Approach for Conducting Strategic Planning in the Construction Industry’, Journal Of Construction Engineering & Management, 136, 12, pp. 1317-1328, Business Source Complete, EBSCOhost, viewed 30 June 2016.
McClary, S 2014, ‘Redrow doubles net debt’, Estates Gazette, 1436, p. 54, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Monea, M 2013, ‘Information system of the financial analysis’, Annals Of The University Of Petrosani Economics, 13, 2, pp. 149-156, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Pickton, D, & Wright, S 2014, ‘What’s swot in strategic analysis?’, Strategic Change, 7, 2, pp. 101-109, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Putra, LD 2015, Horizontal vs vertical analysis of financial statements. Accounting and Financial Tax, 2(9): 11-19
Robinson, TR 2011, International Financial Statement Analysis, Hoboken, N.J.: Wiley, eBook Collection (EBSCOhost), EBSCOhost, viewed 30 June 2016.
Routh, B 2014, Financial statement analysis: Vertical analysis. Oxford, England: Oxford University Press.
Roxburgh, H 2011, ‘Builders seek £840m to fix finances’, Estates Gazette, 938, p. 46, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Stewart, A 2013, ‘The storm before the calm’, Estates Gazette, 831, p. 37, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Teodor, H, & Radu, M 2013, ‘Diagnosis of financial position by balance sheet analysis – case study’, Annals Of The University Of Oradea, Economic Science Series, 22, 2, pp. 530-539, Business Source Complete, EBSCOhost, viewed 30 June 2016.
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Performance Analysis
Business Analysis Report:
Abstract
This report provides an exhaustive comparative appraisal of the fiscal position, cash flows, performance, and evaluation of Bellway PLC and Redrow PLC. These are two companies that both operate in United Kingdom’s real estate industry. The report sought to answer the following questions: Is Bellway in a better financial position than Redrow? Which company is more profitable for investors between Bellway and Redrow? Which of these two companies is better positioned to exploit the opportunities in its environment? The results indicate that Bellway is better positioned fiscally than Redrow in case an emergency situation comes up. All the same, Redrow is better positioned to exploit the opportunities in its environment than Bellway.
Business analysis report
Introduction
This report provides an in-depth comparative appraisal of the fiscal position, cash flows, performance, and evaluation of two companies that operate within the same industry. In analyzing the main financial statement of the two companies, the researcher uses ratio analysis, vertical analysis, and horizontal/trend analysis. The selected firms are Bellway PLC and Redrow PLC. Both of these companies operate in the United Kingdom’s home construction industry. This appraisal comprises SWOT analysis for both Bellway and Redrow.
The two selected companies are described briefly in the introduction section and a fuller description is found at the Study section. Redrow PLC is an organization that is based in Britain and is involved in residential development. Redrow PLC own’s Harrow Estates, which is focused on property and land solutions (Redrow 2016; Cahill 2012). Bellway PLC is a holding company also based in Britain. It owns subsidiary undertakings and it mainly engages in building houses in Britain (Bellway 2016).
Research questions
Is Bellway in a better financial position than Redrow?
Which company is more profitable for investors between Bellway and Redrow?
Which of these two companies is better positioned to exploit the opportunities in its environment?
Literature Review
The selected companies: Redrow PLC and Bellway PLC
Redrow PLC is a firm that is based in the United Kingdom. It is engaged in residential development. Redrow PLC own’s Harrow Estates, which is focused on property and land solutions (Redrow 2016). Redrow PLC is involved primarily in construction and building of residential properties. It provides its services only within the United Kingdom. Redrow PLC has a land bank of over 12,000 development lots giving the firm about 4-year supply of buildable land, which provides a buffer against abrupt increases in land prices (Redrow 2016).
Bellway PLC is a holding company that is based in the United Kingdom. It owns subsidiary undertakings and it largely engages in contructing houses in the United Kingdom (Bellway 2016). Bellway PLC has quite a few subsidiaries the main one being Bellway Properties Limited. Bellway PLC operates in England, Scotland and Wales only. It does not have operations in Northern Ireland. The land bank owned and controlled by Bellway PLC is roughly 34,070 plots (Bellway 2016).
In the 2015 financial year, Bellway sold in excess of 7,760 houses at an average price of roughly £224,000; about eighty percent of which were sold privately and the remainder being sold as social housing. Bellway PLC gives emphasis to sales volume growth and it frequently buys land particularly at low-cost at locations where it can develop (Bloomberg 2016).
Industry: Home Construction / Real Estate
Bellway PLC and Redrow PLC both operate in the United Kingdom’s home construction industry. This is because both companies are engaged in the construction of buildings: that is, they build and develop houses and homes. They construct and develop houses and homes of different types and sizes for diverse markets (Cave 2015; Lai 2013). The housing market in the United Kingdom has been growing steadily (Willer 2016). This steady growth is largely attributed to the aging UK population which increases demand for property overall (Everett & Duval 2010; Stewart 2013).
The long-term trend for house prices in Britain is upwards, although changes in the prices of houses are very cyclical (Cave 2015; Brennan 2013). In the housing market of the United Kingdom, about 250,000 new homes are needed to be built annually in order to stay abreast of the demand (Bourke 2012; Elliot 2013). Even though the construction sector in general in Britain has slowed down, the homebuilding sub-sector has seen a rise in the construction of new homes (Canocchi 2016; Cunningham 2012; Roxburgh 2011).
SWOT analysis
SWOT – strength, weakness, opportunity and threat – analysis is utilized in evaluating a company’s position and guide strategy going forward. Strengths – these are the qualities which determine a company’s success. Strengths allow an organization to attain its mission. Strengths could be intangible or tangible and include qualities and traits that staff members have as well as their flair which offers the company consistency (Everett 2014). Examples of strengths include no debt, workers who are committed, and huge monetary resources.
Weaknesses – these refer to the qualities which impede the productivity of a company preventing the company from attaining its mission and achieving its full potential. Even so, weaknesses can be controlled and the impact and magnitude of the damage could be decreased. SWOT analysis helps not just to identify the weaknesses of a company, but also provides a chance of reversing those weaknesses (Everett 2014).
Opportunities – there are an extensive range of opportunities present in the environment where the company operates. An organization could always benefit from such opportunities, which could arise out of the market, technology or competition. It is notable that existing opportunities could be the utilization of novel technology, exploiting the company’s untapped resources, and failure of a competitor (Fine 2011).
Threats – these are the elements of vulnerability which could jeopardize the organization’s profitability and reliability. They are unavoidable and cannot be controlled. They have to be addressed so as to find a practicable solution (Pickton & Wright 2014).
Fine (2011) noted that a SWOT analysis is a vital part of the strategic planning process of an organization as offers a good all-round perspective of the forward-looking and current situation of the business. The Weaknesses and Strengths sections provide a look at the current position of the company whereas the Threats and Opportunities sections help in projecting challenges as well as possibilities going forward (Bensoussan 2013). SWOT analysis is a suitable tool for strategic planning.
As a result of the analysis, the business owner would be able to set organizational goals and objectives and obtain a clearer picture for basing his decisions on (Lu 2010). In addition, SWOT analysis helps the business owner to utilize a strategy to match the company’s opportunities and threats, and utilize those strategies to convert the threats and weaknesses of the company into its opportunities and threats (Bensoussan 2013). Although a SWOT analysis allows a business owner to identify and understand important issues that affect the company, SWOT analysis does not essentially provide solutions (Fine 2011).
Ratio Analysis Theory
This theory is relevant to the present research paper. Analysis of fiscal reports necessitates skill of statistical tools, accountancy, and mathematics. There are several fundamental ratios that could help anyone in analyzing an organization’s Profit & Loss Account and Balance Sheet for instance current ratio, provisioning coverage ratio, credit deposits ratio, debtors turnover ratio among others. A wide range of fiscal data could be obtained from Annual Reports, Profit and Loss Account, Audit Report, Balance Sheet, Bank Loan Statement, Bank Account Statement, and Income Tax Return.
Financial Statements
Common fiscal statements include cash flow statement, balance sheet, and income statement, and they are all interconnected. The cash flow statement explains cash outflows as well as cash inflows, and it reveals the amount of money which the business has available on hand, which is reported in the balance sheet also. The income statement is used in describing the way liabilities and assets were utilized in the stated accounting period (Routh 2014).
Every financial statement by themselves only offer a portion of the story of the fiscal condition of the business. When taken together however, the fiscal statements offer a more comprehensive picture (Putra 2015). Potential creditors and stockholders usually analyze the fiscal statements of a business organization and compute several fiscal ratios with the data they contain with the aim of identifying the fiscal weaknesses and strengths of the company and establish whether or not the firm is actually a good investment/credit risk (Kumara 2012). In addition, the fiscal statements of a company are usually utilized by the managers as it aids them in making decisions (Routh 2014).
One particular significant way in which the three fiscal statements are utilized together is in calculating free cash flow (FCF). Investors who are smart prefer business organizations which generate lots of FCFs. This is primarily because it signals the ability of the firm to pay off its debt as well as dividends, facilitate the company’s growth, and buy back stock – all vital undertakings from the perspective of an investor (Routh 2014). Even so, whilst free cash flow is an essential gauge of the health of the business, it actually has its limits; as Lan (2014) pointed out, free cash flow is really not immune to accounting trickery.
Financial Statement Analysis
Financial analysis or financial statement analysis is the process in which the fiscal statements of a company are reviewed in order to make better financial decisions. Financial analysis focuses on analyzing a company’s income statement and balance sheet to interpret the business as well as the company’s fiscal ratios for fiscal forecasting, business evaluation, and even fiscal representations (Grimm & Blazovich 2016).
The main fiscal statements include Statement of Cash Flows, Balance Sheet, and Income Statement (Routh 2014). Financial analysis is a process or technique that involves certain methods for assessing fiscal health, performance, risks, as well as the company’s future prospects.
Financial statement analysis is utilized by many stakeholders including equity and credit investors, decision-makers with the company, the public, and even the government. These different stakeholders have various interests and they apply dissimilar techniques in meeting their needs (Lan 2014). Creditors, for example, want to ensure the principal and interest is paid on the debt securities of the organization whenever due. Equity investors are interested in the organization’s long-term earnings power and the growth and sustainability of dividend payments. Some of the common financial analysis methods include DuPont analysis, fundamental analysis, vertical and horizontal analysis, as well as the use of financial ratios. To project performance of the future, historical information combined with several adjustments and suppositions to the fiscal information might be utilized.
Methods of financial analysis
Ratio analysis
Financial ratios are essential tools for performing analysis of financial statements quickly. There are 4 different classifications of financial ratios: leverage, activity, profitability, and liquidity ratios. These financial ratios are usually analyzed across competitors within the industry and over time (Routh 2014). In analyzing the financial statement of a company using the ratio analysis method, various types of ratios are used.
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Liquidity Ratios: these are utilized in determining how fast an organization is able to turn its assets into cash in the event that the business faces insolvency or fiscal challenges. In essence, liquidity ratios are a measure of the capacity of an organization to remain in business (Routh 2014). Some of the liquidity ratios include the liquidity index and the current ratio.
Current ratio is used to measure the current assets of an organization against the organization’s current liabilities (Altman 2012). The current ratio is used in measuring the amount of liquidity that is available to pay for liabilities (Lan 2014). It is notable that the current ratio indicates whether or not the corporation is capable of paying off its short-term liabilities during a situation of emergency through liquidating its current assets (Lan 2014).
A low current ratio means that the company might find it difficult to pay its current liabilities within the short run hence it should be investigated more. If the current ratio is less than one for example, it indicates that even when the firm liquidates its entire current assets, it will still not be able to pay off its current liabilities (Routh 2014).
Quick ratio helps to compare the accounts receivable, short-term marketable securities, and the cash to the company’s current liabilities. If quick ratio is 0.55 for example, it means that the firm is only able to cover 55 percent of current liabilities by monetizing accounts receivable, liquidating short-term marketable securities, and utilizing all cash-on-hand (Lan 2014).
Cash ratio is computed as cash and short-term marketable securities divided by organization’s current liabilities. It is worth mentioning that a cash ratio of 0.31 will mean that the firm could only pay off 31 percent of its current liabilities with the use of its short-term marketable securities as well as cash.
Liquidity index is also one of the liquidity ratios although is not very popular. It is used to measure the period of time that is needed for converting assets into cash (Batta, Ganguly & Rosett 2014).
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Activity Ratios: these ratios essentially demonstrate how well the company’s top executives are managing the resources of the organization. Accounts receivable turnover and accounts payable turnover are some of the common activity ratios. They show the period it takes for an organization to get payments and how long it takes for an organization to pay off its accounts payable (Routh 2014). Other activity ratios include sales to working capital ratio, fixed asset turnover ratio, working capital turnover ratio, and inventory turnover ratio.
Profitability Ratios: these are ratios which show how profitable an organization is. The gross profit ratio and the breakeven point are some of the common profitability ratios. The breakeven point is used in computing the amount of money which the organization has to generate in order for it to break even with its start up costs (Knežević, Rakočević & Đurić 2011). The gross profit ratio shows a quick snapshot of the anticipated revenues.
Leverage Ratios: these show how much an organization depends on its debt in funding its operations. The debt-to-equity ratio is a popular leverage ratio utilized in analyzing financial statements (Johnson 2013). The debt-to-equity ratio depicts the degree to which the company’s top executives are willing to utilize debt in funding the company’s operations. It is computed as follows: (Leases + Short-term debt + Long-term debt) / Equity (Lan 2014).
Vertical analysis
Besides ratio analysis, the other method that can be used to analyze financial statements is the use of vertical and horizontal analysis. Vertical analysis, as Lan (2014) pointed out, reiterates every figure in the income statement as a percentage of net sales. Vertical analysis is important as it allows the top managers to understand if expenses such as Cost of Goods Sold (COGS) are very high in comparison to sales (Andrijasevic & Pasic 2014).
In essence, vertical analysis is the proportional analysis of a fiscal statement in which every line item on the fiscal statement is listed as a percentage of another item (Routh 2014). This essentially implies that each line item on the balance sheet is stated as a percentage of total assets whilst on the income statement, each line item is stated as a percentage of gross sales (Teodor & Radu 2013). All in all, vertical analysis brings about common-size fiscal statements. Boyd et al. (2014) noted that common-size income statements present each of the amount in the income statement as a proportion of sales.
This is used to compare ratios and account balances over various periods of time. It can be used, for instance, in comparing a company’s sales in 2012 to the company’s 2013 sales (Boyd et al. 2014).The financial analysis for the two companies is illustrated exhaustively in the Study section. The analysis includes the horizontal/trend analysis, vertical analysis, and ratio analysis (Monea 2013). The horizontal analysis entails comparing fiscal information over a number of reporting periods. Horizontal analysis is therefore the review of the results of several periods of time (Luypaert, Van Caneghem & Van Uytbergen 2016).
Financial statement analysis is important due to several advantages it presents to an organization. Firstly, financial analysis offers an idea to investors about deciding on investing their money in a certain business organization (Damjibhai 2016). Secondly, various regulatory authorities such as IASB could ensure that the business organization is in fact following the necessary accounting standards (Routh 2014).
Therefore, the analysis enables the company to remain compliant (Ednlister 2012). Thirdly, the analysis of financial statements helps government agencies to analyze the taxation that is owed to the company (Beutler 2014). Fourthly, financial statement analysis enables the company to analyze its own performance over a certain period of time (Routh 2014).
References
Altman, EI 2012, ‘Financial ratios, discriminant analysis and the prediction of corporate bankruptcy’, Journal Of Finance, 23, 4, pp. 589-609, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Andrijasevic, M, & Pasic, V 2014, ‘A blueprint of ratio analysis as information basis of corporation financial management’, Problems Of Management In The 21St Century, 9, 2, pp. 117-123, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Barnard, L 2011, ‘bellway jv reaches into barking’, Estates Gazette, 733, p. 04, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Batta, G, Ganguly, A, & Rosett, J 2014, ‘Financial statement recasting and credit risk assessment’, Accounting & Finance, 54, 1, pp. 47-82, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Bensoussan, BE 2013, Analysis without paralysis: 12 tools to make better strategic decisions. Oxford, England: Oxford University Press.
Beutler, IF 2014, ‘What Makes Wealth Grow? A Wealth Sensitive Financial Statement Analysis’, Journal Of Financial Counseling & Planning, 25, 1, pp. 90-104, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Bourke, C 2012, ‘Further losses for major housebuilders’, Estates Gazette, 836, p. 54, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Boyd, K., Epstein, L., Holtzman, M., & Loughran, M 2014, Horizontal and vertical analysis. Coventry, England: John Wiley & Sons.
Brennan, H 2012, ‘NewBuy rates do not reflect scheme’s risk profile, says Redrow’, Money Marketing (Online Edition), p. 5, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Cahill, J 2012, ‘Hammonds partner quits for Redrow in-house role’, Lawyer, 16, 44, p. 3, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Cave, A 2015, Redrow Cuts Exposure to London Values, Daily Telegraph.
Cunningham, D 2012, ‘Bellway appoints Ayres as chief executive’, Estates Gazette, 1232, p. 03, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Damjibhai, SD 2016, ‘Performance Measurement Through Ratio Analysis: The Case of Indian Hotel Company Ltd’, IUP Journal Of Management Research, 15, 1, pp. 30-36, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Ednlister, RO 2012, ‘An empirical test of financial ratio analysis for small business failure prediction’, Journal Of Financial & Quantitative Analysis, 7, 2, pp. 1477-1493, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Elliott, G 2013, ‘Redrow and place of supply’, Accountancy, 125, 1281, p. 138, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Everett, R, & Duval, C 2010, ‘Some considerations for the use of strategic planning models’, Proceedings For The Northeast Region Decision Sciences Institute (NEDSI), pp. 525-530, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Everett, RF 2014, ‘A Crack in the Foundation: Why SWOT Might Be Less Than Effective in Market Sensing Analysis’, Journal Of Marketing & Management, Special 1, pp. 58-78, Business Source Complete, EBSCOhost, viewed 13 July 2016.
Fine, LG 2011, The SWOT Analysis: Using your strength to overcome weaknesses, using opportunities to overcome threats. Coventry, England: SAGE Publications.
Furber, S 2014, ‘Bellway toasts 11.7% NAV rise’, Estates Gazette, 1442, p. 03, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Grimm, S, & Blazovich, J 2016, ‘Developing student competencies: An integrated approach to a financial statement analysis project’, Journal Of Accounting Education, 35, pp. 69-101, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Jagger, S 2015, Redrow Poised To Finalise Pounds 34.5m ICI Land Bank Deal. Daily Telegraph
Johnson, CG 2013, ‘Ratio analysis and the prediction of firm failure’, Journal Of Finance, 25, 5, pp. 1166-1168, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Knežević, S, Rakočević, S, & Đurić, D 2011, ‘Implementation and Restraints of Ratio Analysis of Financial Reports in Financial Decision Making’, Management (1820-0222), 61, pp. 24-31, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Kumara S 2012, ‘Ethic – based management vs corporate misgovernance — new approach to financial statement analysis’, Journal Of Financial Management & Analysis, 25, 2, pp. 29-38, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Lai, S 2013, ‘Redrow Homes Ltd and Another v Bett plc and Another [1998] 1 All ER 385’, Journal Of Financial Crime, 6, 3, p. 252, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Lan, J 2014, Financial ratios for analyzing a company’s strengths and weaknesses. AAII Journal, 3(7):1-13.
Lundholm, R., & Sloan, R 2011, Equity Valuation and Analysis, 2nd edn (McGraw-Hill Irwin, New York, NY).
Luypaert, M, Van Caneghem, T, & Van Uytbergen, S 2016, ‘Financial statement filing lags: An empirical analysis among small firms’, International Small Business Journal, 34, 4, pp. 506-531, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Lu, W 2010, ‘Improved SWOT Approach for Conducting Strategic Planning in the Construction Industry’, Journal Of Construction Engineering & Management, 136, 12, pp. 1317-1328, Business Source Complete, EBSCOhost, viewed 30 June 2016.
McClary, S 2014, ‘Redrow doubles net debt’, Estates Gazette, 1436, p. 54, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Monea, M 2013, ‘Information system of the financial analysis’, Annals Of The University Of Petrosani Economics, 13, 2, pp. 149-156, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Pickton, D, & Wright, S 2014, ‘What’s swot in strategic analysis?’, Strategic Change, 7, 2, pp. 101-109, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Putra, LD 2015, Horizontal vs vertical analysis of financial statements. Accounting and Financial Tax, 2(9): 11-19
Robinson, TR 2011, International Financial Statement Analysis, Hoboken, N.J.: Wiley, eBook Collection (EBSCOhost), EBSCOhost, viewed 30 June 2016.
Routh, B 2014, Financial statement analysis: Vertical analysis. Oxford, England: Oxford University Press.
Roxburgh, H 2011, ‘Builders seek £840m to fix finances’, Estates Gazette, 938, p. 46, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Stewart, A 2013, ‘The storm before the calm’, Estates Gazette, 831, p. 37, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Teodor, H, & Radu, M 2013, ‘Diagnosis of financial position by balance sheet analysis – case study’, Annals Of The University Of Oradea, Economic Science Series, 22, 2, pp. 530-539, Business Source Complete, EBSCOhost, viewed 30 June 2016.
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Financial Statement Analysis
Business Analysis Report:
Abstract
This report provides an exhaustive comparative appraisal of the fiscal position, cash flows, performance, and evaluation of Bellway PLC and Redrow PLC. These are two companies that both operate in United Kingdom’s real estate industry. The report sought to answer the following questions: Is Bellway in a better financial position than Redrow? Which company is more profitable for investors between Bellway and Redrow? Which of these two companies is better positioned to exploit the opportunities in its environment? The results indicate that Bellway is better positioned fiscally than Redrow in case an emergency situation comes up. All the same, Redrow is better positioned to exploit the opportunities in its environment than Bellway.
Business analysis report
Introduction
This report provides an in-depth comparative appraisal of the fiscal position, cash flows, performance, and evaluation of two companies that operate within the same industry. In analyzing the main financial statement of the two companies, the researcher uses ratio analysis, vertical analysis, and horizontal/trend analysis. The selected firms are Bellway PLC and Redrow PLC. Both of these companies operate in the United Kingdom’s home construction industry. This appraisal comprises SWOT analysis for both Bellway and Redrow.
The two selected companies are described briefly in the introduction section and a fuller description is found at the Study section. Redrow PLC is an organization that is based in Britain and is involved in residential development. Redrow PLC own’s Harrow Estates, which is focused on property and land solutions (Redrow 2016; Cahill 2012). Bellway PLC is a holding company also based in Britain. It owns subsidiary undertakings and it mainly engages in building houses in Britain (Bellway 2016).
Research questions
Is Bellway in a better financial position than Redrow?
Which company is more profitable for investors between Bellway and Redrow?
Which of these two companies is better positioned to exploit the opportunities in its environment?
Literature Review
The selected companies: Redrow PLC and Bellway PLC
Redrow PLC is a firm that is based in the United Kingdom. It is engaged in residential development. Redrow PLC own’s Harrow Estates, which is focused on property and land solutions (Redrow 2016). Redrow PLC is involved primarily in construction and building of residential properties. It provides its services only within the United Kingdom. Redrow PLC has a land bank of over 12,000 development lots giving the firm about 4-year supply of buildable land, which provides a buffer against abrupt increases in land prices (Redrow 2016).
Bellway PLC is a holding company that is based in the United Kingdom. It owns subsidiary undertakings and it largely engages in contructing houses in the United Kingdom (Bellway 2016). Bellway PLC has quite a few subsidiaries the main one being Bellway Properties Limited. Bellway PLC operates in England, Scotland and Wales only. It does not have operations in Northern Ireland. The land bank owned and controlled by Bellway PLC is roughly 34,070 plots (Bellway 2016).
In the 2015 financial year, Bellway sold in excess of 7,760 houses at an average price of roughly £224,000; about eighty percent of which were sold privately and the remainder being sold as social housing. Bellway PLC gives emphasis to sales volume growth and it frequently buys land particularly at low-cost at locations where it can develop (Bloomberg 2016).
Industry: Home Construction / Real Estate
Bellway PLC and Redrow PLC both operate in the United Kingdom’s home construction industry. This is because both companies are engaged in the construction of buildings: that is, they build and develop houses and homes. They construct and develop houses and homes of different types and sizes for diverse markets (Cave 2015; Lai 2013). The housing market in the United Kingdom has been growing steadily (Willer 2016). This steady growth is largely attributed to the aging UK population which increases demand for property overall (Everett & Duval 2010; Stewart 2013).
The long-term trend for house prices in Britain is upwards, although changes in the prices of houses are very cyclical (Cave 2015; Brennan 2013). In the housing market of the United Kingdom, about 250,000 new homes are needed to be built annually in order to stay abreast of the demand (Bourke 2012; Elliot 2013). Even though the construction sector in general in Britain has slowed down, the homebuilding sub-sector has seen a rise in the construction of new homes (Canocchi 2016; Cunningham 2012; Roxburgh 2011).
SWOT analysis
SWOT – strength, weakness, opportunity and threat – analysis is utilized in evaluating a company’s position and guide strategy going forward. Strengths – these are the qualities which determine a company’s success. Strengths allow an organization to attain its mission. Strengths could be intangible or tangible and include qualities and traits that staff members have as well as their flair which offers the company consistency (Everett 2014). Examples of strengths include no debt, workers who are committed, and huge monetary resources.
Weaknesses – these refer to the qualities which impede the productivity of a company preventing the company from attaining its mission and achieving its full potential. Even so, weaknesses can be controlled and the impact and magnitude of the damage could be decreased. SWOT analysis helps not just to identify the weaknesses of a company, but also provides a chance of reversing those weaknesses (Everett 2014).
Opportunities – there are an extensive range of opportunities present in the environment where the company operates. An organization could always benefit from such opportunities, which could arise out of the market, technology or competition. It is notable that existing opportunities could be the utilization of novel technology, exploiting the company’s untapped resources, and failure of a competitor (Fine 2011).
Threats – these are the elements of vulnerability which could jeopardize the organization’s profitability and reliability. They are unavoidable and cannot be controlled. They have to be addressed so as to find a practicable solution (Pickton & Wright 2014).
Fine (2011) noted that a SWOT analysis is a vital part of the strategic planning process of an organization as offers a good all-round perspective of the forward-looking and current situation of the business. The Weaknesses and Strengths sections provide a look at the current position of the company whereas the Threats and Opportunities sections help in projecting challenges as well as possibilities going forward (Bensoussan 2013). SWOT analysis is a suitable tool for strategic planning.
As a result of the analysis, the business owner would be able to set organizational goals and objectives and obtain a clearer picture for basing his decisions on (Lu 2010). In addition, SWOT analysis helps the business owner to utilize a strategy to match the company’s opportunities and threats, and utilize those strategies to convert the threats and weaknesses of the company into its opportunities and threats (Bensoussan 2013). Although a SWOT analysis allows a business owner to identify and understand important issues that affect the company, SWOT analysis does not essentially provide solutions (Fine 2011).
Ratio Analysis Theory
This theory is relevant to the present research paper. Analysis of fiscal reports necessitates skill of statistical tools, accountancy, and mathematics. There are several fundamental ratios that could help anyone in analyzing an organization’s Profit & Loss Account and Balance Sheet for instance current ratio, provisioning coverage ratio, credit deposits ratio, debtors turnover ratio among others. A wide range of fiscal data could be obtained from Annual Reports, Profit and Loss Account, Audit Report, Balance Sheet, Bank Loan Statement, Bank Account Statement, and Income Tax Return.
Financial Statements
Common fiscal statements include cash flow statement, balance sheet, and income statement, and they are all interconnected. The cash flow statement explains cash outflows as well as cash inflows, and it reveals the amount of money which the business has available on hand, which is reported in the balance sheet also. The income statement is used in describing the way liabilities and assets were utilized in the stated accounting period (Routh 2014).
Every financial statement by themselves only offer a portion of the story of the fiscal condition of the business. When taken together however, the fiscal statements offer a more comprehensive picture (Putra 2015). Potential creditors and stockholders usually analyze the fiscal statements of a business organization and compute several fiscal ratios with the data they contain with the aim of identifying the fiscal weaknesses and strengths of the company and establish whether or not the firm is actually a good investment/credit risk (Kumara 2012). In addition, the fiscal statements of a company are usually utilized by the managers as it aids them in making decisions (Routh 2014).
One particular significant way in which the three fiscal statements are utilized together is in calculating free cash flow (FCF). Investors who are smart prefer business organizations which generate lots of FCFs. This is primarily because it signals the ability of the firm to pay off its debt as well as dividends, facilitate the company’s growth, and buy back stock – all vital undertakings from the perspective of an investor (Routh 2014). Even so, whilst free cash flow is an essential gauge of the health of the business, it actually has its limits; as Lan (2014) pointed out, free cash flow is really not immune to accounting trickery.
Financial Statement Analysis
Financial analysis or financial statement analysis is the process in which the fiscal statements of a company are reviewed in order to make better financial decisions. Financial analysis focuses on analyzing a company’s income statement and balance sheet to interpret the business as well as the company’s fiscal ratios for fiscal forecasting, business evaluation, and even fiscal representations (Grimm & Blazovich 2016).
The main fiscal statements include Statement of Cash Flows, Balance Sheet, and Income Statement (Routh 2014). Financial analysis is a process or technique that involves certain methods for assessing fiscal health, performance, risks, as well as the company’s future prospects.
Financial statement analysis is utilized by many stakeholders including equity and credit investors, decision-makers with the company, the public, and even the government. These different stakeholders have various interests and they apply dissimilar techniques in meeting their needs (Lan 2014). Creditors, for example, want to ensure the principal and interest is paid on the debt securities of the organization whenever due. Equity investors are interested in the organization’s long-term earnings power and the growth and sustainability of dividend payments. Some of the common financial analysis methods include DuPont analysis, fundamental analysis, vertical and horizontal analysis, as well as the use of financial ratios. To project performance of the future, historical information combined with several adjustments and suppositions to the fiscal information might be utilized.
Methods of financial analysis
Ratio analysis
Financial ratios are essential tools for performing analysis of financial statements quickly. There are 4 different classifications of financial ratios: leverage, activity, profitability, and liquidity ratios. These financial ratios are usually analyzed across competitors within the industry and over time (Routh 2014). In analyzing the financial statement of a company using the ratio analysis method, various types of ratios are used.
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Liquidity Ratios: these are utilized in determining how fast an organization is able to turn its assets into cash in the event that the business faces insolvency or fiscal challenges. In essence, liquidity ratios are a measure of the capacity of an organization to remain in business (Routh 2014). Some of the liquidity ratios include the liquidity index and the current ratio.
Current ratio is used to measure the current assets of an organization against the organization’s current liabilities (Altman 2012). The current ratio is used in measuring the amount of liquidity that is available to pay for liabilities (Lan 2014). It is notable that the current ratio indicates whether or not the corporation is capable of paying off its short-term liabilities during a situation of emergency through liquidating its current assets (Lan 2014).
A low current ratio means that the company might find it difficult to pay its current liabilities within the short run hence it should be investigated more. If the current ratio is less than one for example, it indicates that even when the firm liquidates its entire current assets, it will still not be able to pay off its current liabilities (Routh 2014).
Quick ratio helps to compare the accounts receivable, short-term marketable securities, and the cash to the company’s current liabilities. If quick ratio is 0.55 for example, it means that the firm is only able to cover 55 percent of current liabilities by monetizing accounts receivable, liquidating short-term marketable securities, and utilizing all cash-on-hand (Lan 2014).
Cash ratio is computed as cash and short-term marketable securities divided by organization’s current liabilities. It is worth mentioning that a cash ratio of 0.31 will mean that the firm could only pay off 31 percent of its current liabilities with the use of its short-term marketable securities as well as cash.
Liquidity index is also one of the liquidity ratios although is not very popular. It is used to measure the period of time that is needed for converting assets into cash (Batta, Ganguly & Rosett 2014).
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Activity Ratios: these ratios essentially demonstrate how well the company’s top executives are managing the resources of the organization. Accounts receivable turnover and accounts payable turnover are some of the common activity ratios. They show the period it takes for an organization to get payments and how long it takes for an organization to pay off its accounts payable (Routh 2014). Other activity ratios include sales to working capital ratio, fixed asset turnover ratio, working capital turnover ratio, and inventory turnover ratio.
Profitability Ratios: these are ratios which show how profitable an organization is. The gross profit ratio and the breakeven point are some of the common profitability ratios. The breakeven point is used in computing the amount of money which the organization has to generate in order for it to break even with its start up costs (Knežević, Rakočević & Đurić 2011). The gross profit ratio shows a quick snapshot of the anticipated revenues.
Leverage Ratios: these show how much an organization depends on its debt in funding its operations. The debt-to-equity ratio is a popular leverage ratio utilized in analyzing financial statements (Johnson 2013). The debt-to-equity ratio depicts the degree to which the company’s top executives are willing to utilize debt in funding the company’s operations. It is computed as follows: (Leases + Short-term debt + Long-term debt) / Equity (Lan 2014).
Vertical analysis
Besides ratio analysis, the other method that can be used to analyze financial statements is the use of vertical and horizontal analysis. Vertical analysis, as Lan (2014) pointed out, reiterates every figure in the income statement as a percentage of net sales. Vertical analysis is important as it allows the top managers to understand if expenses such as Cost of Goods Sold (COGS) are very high in comparison to sales (Andrijasevic & Pasic 2014).
In essence, vertical analysis is the proportional analysis of a fiscal statement in which every line item on the fiscal statement is listed as a percentage of another item (Routh 2014). This essentially implies that each line item on the balance sheet is stated as a percentage of total assets whilst on the income statement, each line item is stated as a percentage of gross sales (Teodor & Radu 2013). All in all, vertical analysis brings about common-size fiscal statements. Boyd et al. (2014) noted that common-size income statements present each of the amount in the income statement as a proportion of sales.
This is used to compare ratios and account balances over various periods of time. It can be used, for instance, in comparing a company’s sales in 2012 to the company’s 2013 sales (Boyd et al. 2014).The financial analysis for the two companies is illustrated exhaustively in the Study section. The analysis includes the horizontal/trend analysis, vertical analysis, and ratio analysis (Monea 2013). The horizontal analysis entails comparing fiscal information over a number of reporting periods. Horizontal analysis is therefore the review of the results of several periods of time (Luypaert, Van Caneghem & Van Uytbergen 2016).
Financial statement analysis is important due to several advantages it presents to an organization. Firstly, financial analysis offers an idea to investors about deciding on investing their money in a certain business organization (Damjibhai 2016). Secondly, various regulatory authorities such as IASB could ensure that the business organization is in fact following the necessary accounting standards (Routh 2014).
Therefore, the analysis enables the company to remain compliant (Ednlister 2012). Thirdly, the analysis of financial statements helps government agencies to analyze the taxation that is owed to the company (Beutler 2014). Fourthly, financial statement analysis enables the company to analyze its own performance over a certain period of time (Routh 2014).
References
Altman, EI 2012, ‘Financial ratios, discriminant analysis and the prediction of corporate bankruptcy’, Journal Of Finance, 23, 4, pp. 589-609, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Andrijasevic, M, & Pasic, V 2014, ‘A blueprint of ratio analysis as information basis of corporation financial management’, Problems Of Management In The 21St Century, 9, 2, pp. 117-123, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Barnard, L 2011, ‘bellway jv reaches into barking’, Estates Gazette, 733, p. 04, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Batta, G, Ganguly, A, & Rosett, J 2014, ‘Financial statement recasting and credit risk assessment’, Accounting & Finance, 54, 1, pp. 47-82, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Bensoussan, BE 2013, Analysis without paralysis: 12 tools to make better strategic decisions. Oxford, England: Oxford University Press.
Beutler, IF 2014, ‘What Makes Wealth Grow? A Wealth Sensitive Financial Statement Analysis’, Journal Of Financial Counseling & Planning, 25, 1, pp. 90-104, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Bourke, C 2012, ‘Further losses for major housebuilders’, Estates Gazette, 836, p. 54, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Boyd, K., Epstein, L., Holtzman, M., & Loughran, M 2014, Horizontal and vertical analysis. Coventry, England: John Wiley & Sons.
Brennan, H 2012, ‘NewBuy rates do not reflect scheme’s risk profile, says Redrow’, Money Marketing (Online Edition), p. 5, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Cahill, J 2012, ‘Hammonds partner quits for Redrow in-house role’, Lawyer, 16, 44, p. 3, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Cave, A 2015, Redrow Cuts Exposure to London Values, Daily Telegraph.
Cunningham, D 2012, ‘Bellway appoints Ayres as chief executive’, Estates Gazette, 1232, p. 03, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Damjibhai, SD 2016, ‘Performance Measurement Through Ratio Analysis: The Case of Indian Hotel Company Ltd’, IUP Journal Of Management Research, 15, 1, pp. 30-36, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Ednlister, RO 2012, ‘An empirical test of financial ratio analysis for small business failure prediction’, Journal Of Financial & Quantitative Analysis, 7, 2, pp. 1477-1493, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Elliott, G 2013, ‘Redrow and place of supply’, Accountancy, 125, 1281, p. 138, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Everett, R, & Duval, C 2010, ‘Some considerations for the use of strategic planning models’, Proceedings For The Northeast Region Decision Sciences Institute (NEDSI), pp. 525-530, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Everett, RF 2014, ‘A Crack in the Foundation: Why SWOT Might Be Less Than Effective in Market Sensing Analysis’, Journal Of Marketing & Management, Special 1, pp. 58-78, Business Source Complete, EBSCOhost, viewed 13 July 2016.
Fine, LG 2011, The SWOT Analysis: Using your strength to overcome weaknesses, using opportunities to overcome threats. Coventry, England: SAGE Publications.
Furber, S 2014, ‘Bellway toasts 11.7% NAV rise’, Estates Gazette, 1442, p. 03, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Grimm, S, & Blazovich, J 2016, ‘Developing student competencies: An integrated approach to a financial statement analysis project’, Journal Of Accounting Education, 35, pp. 69-101, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Jagger, S 2015, Redrow Poised To Finalise Pounds 34.5m ICI Land Bank Deal. Daily Telegraph
Johnson, CG 2013, ‘Ratio analysis and the prediction of firm failure’, Journal Of Finance, 25, 5, pp. 1166-1168, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Knežević, S, Rakočević, S, & Đurić, D 2011, ‘Implementation and Restraints of Ratio Analysis of Financial Reports in Financial Decision Making’, Management (1820-0222), 61, pp. 24-31, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Kumara S 2012, ‘Ethic – based management vs corporate misgovernance — new approach to financial statement analysis’, Journal Of Financial Management & Analysis, 25, 2, pp. 29-38, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Lai, S 2013, ‘Redrow Homes Ltd and Another v Bett plc and Another [1998] 1 All ER 385’, Journal Of Financial Crime, 6, 3, p. 252, Business Source Complete, EBSCOhost, viewed 30 June 2016.
Lan, J 2014, Financial ratios for analyzing a company’s strengths and weaknesses. AAII Journal, 3(7):1-13.
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McClary, S 2014, ‘Redrow doubles net debt’, Estates Gazette, 1436, p. 54, Business Source Complete, EBSCOhost, viewed 30 June 2016.
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Spirituality
Introduction
Most philosophers believe that every person has a worldview. They define the worldview as a framework and commitment of ideas and attitudes about human beings, life, and the world. They further describe a worldview as a set of beliefs that man holds to and lives by. It is of great importance for human beings to discover their worldviews and abide to them.
Generally, there is no widely agreed definition of spirituality. Traditionally, spirituality is viewed as the process of reformation that is aimed at recovering the original shape of man. However in present times, spirituality has been based on subjective experience that incorporates personal growth or transformation, and this is separate from the religious views.
Spirituality can be defined from different theories including scientism which is the belief in science and using scientific evidence to describe spiritually. Scientism is a belief held by scholars in their bid for the search for physical truth. On the other hand, pluralism refers to the process of viewing the society from multiple entities which work as a single unit. An example of pluralism is the society with different cultural backgrounds which maintains their tradition. Post modernism describes spirituality as a concept of modifying traditional beliefs according to modern ideas.
Prime reality
Prime reality is the understanding of what is real. This involves understanding the origin of faith of individuals. According to Christianity, God is real, and it is through his intentions that we can live. (Bak, 2013) posits that this definition is not applicable to every individual since non-Christians do not believe in God. Non-Christians believe that God cannot be present in all places at all times. However, Christians believe that Gods powers are unlimited. Prime reality is what one believes in depending on his views of reality. Believing that God is present and available in all places at all times is a reality for specific people but not others.
Nature of the world around us
From a religious perspective, nature is God’s creation, and the world is part of God‘s plan for man. Being a Christian, I believe that God is the creator of all things. According to the Bible teachings, God provided man with natural things in the world for man to enjoy God’s creation.
Certain situation where man experiences difficulties is part of the reality as it forms part of the learning process. As a Christian, I believe that understanding God’s plan is beyond us despite the fact that God has given us the gift of reasoning. Christians rely on faith to guide their understanding of the world (Murphy, 2016).
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Human beings
Murphy (2016) states that humans are God’s creation; human beings have life and a sense of self-awareness to understand their purpose on earth .but others view human as complex machine developed due to scientific discovery. But for Christians, human being are God’s superior creation because God created man giving him unique abilities compared to other God’s creation on earth .this dispute the fact that human being is termed as machines.
Since God created human beings in his image, these means human beings are above all other creation on earth. Therefore, their role is to take care of the world but not undermine the rights of other creations. Human being need to understand God intention which initial living in harmony and with other creation on earth (Murphy, 2016).
What happens to a person at death?
When people die they leave behind memories, which are cherished depending on an individual action while on earth. Apart from Christians others believe in life after death, this is his reason why several people perform good deeds while still alive because they believe God will judge them according to their actions.
Christian believes in life after death whereby the physical body dies, but our souls remain alive to start a new life in heaven. Murphy(2016) reports that when people dietheir souls escape from their bodiesand return to God the creator.
Christians believe that righteous people will be granted eternal life by God if their actions were in line with God’s commandments. According to (Murphy, 2016), the judgment day is important because this is the day when God decides our fate. This is the day that our actions are evaluated to determine if we are worth living with God in heaven. God’s Ten Commandments are rules given by God to our ancestors to guide our action. Therefore by not obeying God’s teachings we are likely to lose the chance of being granted eternal life.
The possibility to know anything at all
Knowing anything means the understanding of our worldview based on what influence our actions. Having different sets of beliefs reveals the different perspective of our view of the world. When we experience continuous changes as we go through different circumstances enables us to increase our levels of knowledge. Seeking God’s guidance is important to gain more knowledge and understand our purpose on earth (Tomasello, 2014).
How do we know what is right or wrong?
Tomasello (2014) explains how humans determine what is wrong and right by conforming to Gods moral law. In his view, moral laws reflect God’ s purpose for man. Human beings are expected to live by Gods’ intention. God moral laws are the Ten Commandments in the Bible that stipulate various acts that need to be emulated by man. However, people fail to understand God’s purpose hence violating God’s laws.
Christians believe that God makes them undergo difficulties as a punishment for their wrongdoing. Other people believe best for themselves and acceptable to our fellow humans are termed as the right thing, while what can cause harm to the majority is termed as wrong (Tomasello, 2014).
What is the meaning of human history?
History can be defined as the sequence of events that leads to fulfilling God purpose; however history is also defined as important records about past events that formed part of our identity. Human history from a Christian perspective portrays God as a wise, holy, powerful, true and the creator of the world.
Christian’s link human history to God creation, from a Christina perspective, human history cannot be defined without explaining Gods creation. Non –Christians view human history based on specific events that they value while some people believe that human history is imagination generated from the past events.
Conclusion
Worldviews are significant whether man recognizes them or not. They offer a basis upon which the actions and corresponding moral values are based. Our worldview concerning reality, human beings and understand of what is right or wrong differ based on individual perspective. Views presented by pluralist, scientist and post modernist depend of their individual world view.
References
Bak, P. (2013). How nature works: the science of self-organized criticality. Springer Science & Business Media.
Murphy, M. C. (2016). God and moral law. Oxford University Press.
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Worldview
Introduction
Most philosophers believe that every person has a worldview. They define the worldview as a framework and commitment of ideas and attitudes about human beings, life, and the world. They further describe a worldview as a set of beliefs that man holds to and lives by. It is of great importance for human beings to discover their worldview and abide to them.
Generally, there is no widely agreed definition of spirituality. Traditionally, spirituality is viewed as the process of reformation that is aimed at recovering the original shape of man. However in present times, spirituality has been based on subjective experience that incorporates personal growth or transformation, and this is separate from the religious views.
Spirituality can be defined from different theories including scientism which is the belief in science and using scientific evidence to describe spiritually. Scientism is a belief held by scholars in their bid for the search for physical truth. On the other hand, pluralism refers to the process of viewing the society from multiple entities which work as a single unit. An example of pluralism is the society with different cultural backgrounds which maintains their tradition. Post modernism describes spirituality as a concept of modifying traditional beliefs according to modern ideas.
Prime reality
Prime reality is the understanding of what is real. This involves understanding the origin of faith of individuals. According to Christianity, God is real, and it is through his intentions that we can live. (Bak, 2013) posits that this definition is not applicable to every individual since non-Christians do not believe in God. Non-Christians believe that God cannot be present in all places at all times. However, Christians believe that Gods powers are unlimited. Prime reality is what one believes in depending on his views of reality. Believing that God is present and available in all places at all times is a reality for specific people but not others.
Nature of the world around us
From a religious perspective, nature is God’s creation, and the world is part of God‘s plan for man. Being a Christian, I believe that God is the creator of all things. According to the Bible teachings, God provided man with natural things in the world for man to enjoy God’s creation.
Certain situation where man experiences difficulties is part of the reality as it forms part of the learning process. As a Christian, I believe that understanding God’s plan is beyond us despite the fact that God has given us the gift of reasoning. Christians rely on faith to guide their understanding of the world (Murphy, 2016).
Want help to write your Essay or Assignments? Click here
Human beings
Murphy (2016) states that humans are God’s creation; human beings have life and a sense of self-awareness to understand their purpose on earth .but others view human as complex machine developed due to scientific discovery. But for Christians, human being are God’s superior creation because God created man giving him unique abilities compared to other God’s creation on earth .this dispute the fact that human being is termed as machines.
Since God created human beings in his image, these means human beings are above all other creation on earth. Therefore, their role is to take care of the world but not undermine the rights of other creations. Human being need to understand God intention which initial living in harmony and with other creation on earth (Murphy, 2016).
What happens to a person at death?
When people die they leave behind memories, which are cherished depending on an individual action while on earth. Apart from Christians others believe in life after death, this is his reason why several people perform good deeds while still alive because they believe God will judge them according to their actions.
Christian believes in life after death whereby the physical body dies, but our souls remain alive to start a new life in heaven. Murphy(2016) reports that when people dietheir souls escape from their bodiesand return to God the creator.
Christians believe that righteous people will be granted eternal life by God if their actions were in line with God’s commandments. According to (Murphy, 2016), the judgment day is important because this is the day when God decides our fate. This is the day that our actions are evaluated to determine if we are worth living with God in heaven. God’s Ten Commandments are rules given by God to our ancestors to guide our action. Therefore by not obeying God’s teachings we are likely to lose the chance of being granted eternal life.
The possibility to know anything at all
Knowing anything means the understanding of our worldview based on what influence our actions. Having different sets of beliefs reveals the different perspective of our view of the world. When we experience continuous changes as we go through different circumstances enables us to increase our levels of knowledge. Seeking God’s guidance is important to gain more knowledge and understand our purpose on earth (Tomasello, 2014).
How do we know what is right or wrong?
Tomasello (2014) explains how humans determine what is wrong and right by conforming to Gods moral law. In his view, moral laws reflect God’ s purpose for man. Human beings are expected to live by Gods’ intention. God moral laws are the Ten Commandments in the Bible that stipulate various acts that need to be emulated by man. However, people fail to understand God’s purpose hence violating God’s laws.
Christians believe that God makes them undergo difficulties as a punishment for their wrongdoing. Other people believe best for themselves and acceptable to our fellow humans are termed as the right thing, while what can cause harm to the majority is termed as wrong (Tomasello, 2014).
What is the meaning of human history?
History can be defined as the sequence of events that leads to fulfilling God purpose; however history is also defined as important records about past events that formed part of our identity. Human history from a Christian perspective portrays God as a wise, holy, powerful, true and the creator of the world.
Christian’s link human history to God creation, from a Christina perspective, human history cannot be defined without explaining Gods creation. Non –Christians view human history based on specific events that they value while some people believe that human history is imagination generated from the past events.
Conclusion
Worldviews are significant whether man recognizes them or not. They offer a basis upon which the actions and corresponding moral values are based. Our worldview concerning reality, human beings and understand of what is right or wrong differ based on individual perspective. Views presented by pluralist, scientist and post modernist depend of their individual world view.
References
Bak, P. (2013). How nature works: the science of self-organized criticality. Springer Science & Business Media.
Murphy, M. C. (2016). God and moral law. Oxford University Press.
