Internal Audit Function and Fraud Detection in Government Essay Example for Free

Internal Audit Function and Fraud Detection in Government EssayCHAPTER ONE 1. 0Introduction This chapter pass on cover the background of the study, the statement of the problem, the purpose of the study, the objectives, the research questions, and the scope, the significance of the study and the structure of the report. 1. 1Background of the Study According to Hector Perela, (2009), Internal auditing function with other(a) preventative mechanisms like financial reporting and external audit to helps maintain cost-efficient contracting between owners and managers. It is designed by government agencies to add value and purify organizational performance. It helps organizations accomplish their objectives by bringing a systematic, disciplined approaches to evaluate and improve the effectiveness of risk management, control and governance processes. Internal audit helps organizations to delay that financial and other records are reliable and complete. As well as ensuring that man agement adheres to policies and procedures for orderly and efficient conduct of the business, proper recording and safeguarding of assets and resources. The purpose of congenital audit as far as the organization is concerned is to get accounting errors corrected and control weaknesses eliminated.The most testing time for the internal listener is the report he/she writes to achieve this end. No precise legal definition of fraud exists many of the offences referred to as fraud are covered by the stealing Acts of 1968 and 1978. Generally, the term is functiond to describe such acts as deception, bribery, forgery, extortion, corruption, theft, conspiracy, embezzlement, misappropriation, false representation, concealment of material facts and collusion. For practical purposes fraud may be defined as the use of deception with the intention of obtaining an advantage, avoiding an obligation or causing loss to another part. Internal Audit, University of Birmingham, Edgbaston, Birmingham, B15 2TT, UK) On one hand, fraud detection in government agencies involves employees or managers of the victim organization (commercial angles news letters 2001), the most effective tools for fraud detection are internal audit review, specific investigation by management, employee notification, and accidental discovery. Fraud detection helps Management to address its responsibility through development of an appropriate design of the system of internal control and the effective operation of that system. legion(predicate) fraud prevention and detection techniques are now utilized to reduce the direct and indirect costs associated with all forms of fraud. These various techniques include but are not limited to fraud policies, telephone hot lines, employee reference checks, fraud vulnerability reviews, vendor contract reviews and sanctions, analytical reviews , password protection, firewalls, digital analysis and other forms of software technology, and discovery sampling (Thomas and Gib son, 2003).Government departments implements the ideas and decisions of executive government in a particular area of governance. Each department is led by a minister in charge or commissioner, and the main work of the department is determined by legislation. Despite the internal audit function, many government agencies lead astray to detect fraud for example loss of huge monies in NAADS. The National Agricultural Advisory Services (NAADS) is a Ugandan government agency created in 2001 to improve rural livelihoods by increasing agricultural productivity and profitability.

Implications of Information Technology in Developing Countries Essay Example for Free

Implications of Information Technology in Developing Countries EssayThe survival and growth of organizations in an increasingly luxuriant environment would depend upon effective usance of instruction applied science for aligning the organizational structure with environmental preferences and for creating symbiotic interorganizational structures. How drive out IT help the organizations in responding to the ch on the wholeenges of an increasingly complex and un authoritative environment? How can IT help the organizations achieve the flexible organization structure? These atomic number 18 the topics that remains to be a matter of head word for many developing countries. Although Information technology is still a . b lose box . technology for developing countries, it is largely applied in industrialised countries to the sepa yard of the majority of developing countries. This paper will filter out to illuminate the aspects and the impact of Information Technology in managing organizational change and its implications for developing countries.1. Introduction The rate and magnitude of change are rapidly outpacing the complex of theories. frugal, social, and philosophical on which public and private decisions are based. To the extent that we continue to view the world from the military position of an earlier, vanishing age, we will continue to misunderstand the developments surrounding the transition to an information society, be unable to realize the entire economic and social potential of this revolutionary technology, and pretend making some very serious mistakes as reality and the theories we use to interpret it continue to diverge..-Arthur Cordell(1987).We have modified our environment so radically that we moldiness modify ourselves in order to exist in this new environment..Norbert Wiener(1957) The survival and growth of organizations in an increasingly turbulent environment would depend upon effective utilization of information technology for al igning the organizational structure with environmental preferences and for creating symbiotic interorganizational structures. How can IT help the organizations in responding to the challenges of an increasingly complex and uncertain environment? How can IT help the organizations achieve the .flexible. organization structure? These are the topics that remains to be a matter of question for many developing countries. This study will try to illuminate the aspects and the impact of Information Technology in managing organizational change and its implications for developing countries.2. Aspects of Information Technology Information technology (IT) may be outlined as the convergence of electronics, computing, and telecommunications. It has unleashed a tidal wave of proficient innovation in the collecting, storing, processing, transmission, and presentation of information that has not only if transformed the information technology sector itself into a highly dynamic and expanding field o f activity creating new markets and generating new investment, income, and jobs- but also provided other sectors with to a greater extent rapid and efficient mechanisms for responding to shifts in demand patterns and changes in multinational comparative advantages, through more(prenominal) efficient outturn processes and new and improved products and services (e.g. replacing mechanical and electromechanical components, upgrading conventional products by creating new product functions, incorporating skills and functions into equipment, automating routine work, making technical, professional, or financial services more transportable).The development of IT is intimately associated with the overwhelming advances recently accomplished in microelectronics. Based on scientific and scientific breakthroughs in transistors, semiconductors, and integrated circuits ( splinters), micro-electronics is affecting every other branch of the economy, in terms of twain its present and emergin g employment and skill requirements and its future market prospects. Its introduction has resulted in a drastic fall in costs as well as dramatically improved technical performance both within the electronics industry and outside it (Malone and Rockart, 1993). The continuous rise in the number of features on a single micro-electronic chip has permitted littleer assembly costs for electronic equipment (each chip replacing many discrete components), faster switching speeds (thus faster and more stringy computers), and more reliable, smaller, and spark equipment (fewer interconnections, less power and material).Similar dramatic falls in costs occurred in the transport and steel industries in the nineteenth century and in might in the twentieth, associated with the emergence of the third and fourth Kondratiev cycles, respectively. The potential effects of microelectronics are thus very far-reaching, for its use in production saves on virtually all inputs, ranging from skilled and un skilled labor to energy, materials, andcapital. All sectors of the economy have been influenced by the development of IT applications information technology opens up immenseer opportunities for the exploitation of economies of scale and scope, allows the more flexible production and use of labor and equipment, promotes the internationalistization of production and markets, offers greater mobility and flexibility in capital and financial flows and services, and is frequently the precondition for the creation of innovative financial instruments.Information system developments are invariably universe applied to increase the productivity, quality, and efficiency of finance, banking, business management, and public administration. In manufacturing, and to some extent in agriculture, many processes have been automated, some requiring highly flexible, self-regulating machines, or robots. The engineering industry has been transformed by computer-aided design and three-dimensional compu terized screen displays. The pace of technological change in IT will most likely accelerate the already observable growth in the interdependence of international relations not further economic or financial, but also political and cultural. National economies have become more susceptible to the effects of policy decisions taken at the international take aim, and domestic economic measures are having increased impacts on economic policies of other countries.World markets for the white plague of similar goods are growing, and so are common lifestyles crosswise national borders. The advance of telecommunications and computerization has recently enabled large companies to use information systems to transmit technical and economic information among numerous computer systems at various geographical locations, subjecting widely dispersed industrial plants to direct managerial control from a central location this affects the international division of labor and production and internationa l share, changing the patterns of industrial ownership and control, altering the competitive standing of individual countries, and creating new trading ruinners. It is the integration of functions that confers on information technology its real economic and social significance.More than just a gradual and incremental technological evolution leading to improved ways of carrying out traditional manufacturing processes (i.e. simply the replacement of new technologies for existing systems and the rationalization of standard activities), IT offers the probability for completely new ways of working through systems integration. Rather than applying one item of new technology to each of the production functions now performed at distinct stages of the production process, i.e. design, production, marketing, and distribution (in what could be called stand-alone improvements or island automation), having evolved in to new technologies, i.e. endeavor Resource prep systems, IT offers the po ssibility of linking design to production (e.g. through programmable manufacturing, measuring, and testing equipment responding to the codification of design), planning and design to marketing and distribution (e.g. through a variety of computer help and databases that sense and collect changing market trends), production to distribution (e.g. by automatically incorporating orders and commissions by customers and suppliers into the production process), etc.The complete integration of all these production subsystems in a synergistic ensemble is still more a long-term trend than a reality, but use of automated equipment to link together individual items of equipment belonging to hitherto discrete manufacturing operations has already made IT a strategic issue for industry. More technical advances are expected curtly in the automation of telecommunications and the linkage of computers by data transmission that will enhance the possibilities of systems integration. Such programmable a utomation, or computer-integrated manufacturing (CIM), has the capability of integrating information processing with somatogenic tasks performed by programmable machine tools or robots. CIM offers radical improvements in traditional problem areas confronting manufacturers, such as trim down lead time for existing and new products reduced inventories more accurate control over production and better quality production management information increased utilization of expensive equipment reduced budget items costs improved and consistent quality more accurate forecasting improved delivery performance (Miles et al., 1988). These features characterize information technology as a new technological system, in which far-reaching changes in the trajectories of electronic, computer, and telecommunication technologies converge and offer a range of new technological options to virtually all branches of the economy.Moreover, IT forms the basis for a reorganization of industrial society a nd the core of the emerging techno-economic paradigm. The reason for the pre-eminence of the new technological system clustered around information technology over the as new technological systems clustered around new materials and biotechnology is the fact that information activities of one kind or another are a part of every activity within an industrial or commercial sector, as well as in our working and domestic lives. Almost all tillable activities have high information intensity (some involve little else, such as banking or education).Further more, along with the premier of internet technology and e-business architectures powerful concepts like inventory control, supply chain management, customer relationship/service management, and management resource planning through the internet under the name of Enterprise Resource Planning have enabled IT to be capable of offering strategic improvements in the productivity and competitiveness of virtually any socio-economic activity. Oth er than industrial or commercial sectors, information technology is also applicable in education sector and in public institutions. Thus, Information Technology is universally applicable. Probably only a fraction of the benefits derived from information technology-based innovations have so far been reaped and the rest remain to be acquired in the next decades. The shift towards systems integration to capitalize the full potential benefits of IT requires considerable adaptations, learning processes, and structural changes in existing socioeconomic institutions and organizational systems.The tradition in most current organizations is still to operate in a largely disintegrated fashion, reminiscent of the Ford-Taylorist management approaches that dominated the fourth Kondratiev cycle high division of labor, increasing functional specialization/differentiation and de-skilling of many tasks, hardened manufacturing procedures and controls, long management hierarchies with bureaucratic de cision-making procedures and a mechanistic approach to performance. Under these conditions, use of IT is restricted to piecemeal technology improvements. By contrast, information technology-based systems offer organizations the opportunity of functional integration, multi-skilled staff, rapid and flexible decision-making structures with greater delegation of responsibilities and greater autonomy of operating units, a more flexible and organic approach enabling a quick adjustment to changing environmental conditions. (Piore and Sabel, 1984.)But this means that information management skills require the ability to make choices about the optimal arrangements for particular situations foreign earlier generations of technology, IT offers not a single best way of organization but a set of more or less appropriate alternate organizing, staffing, and managing options that may be adopted in different organizational contexts. There is no determinism in the way information technology influenc es the socioinstitutional framework. Therefore, organizational innovation is a crucial part of the requirement for firms to adapt to survive (Miles, 1988). Unfortunately, this is true for all the institutions as well. Further, it is even more dramatic for the organizations in developing countries because of not being able to properly adapt to this so-called .black-box. technology. No matter how frustrating it is interpreted for these countries, IT still has significant impact on their development.Although socio-economic structure of these countries resists organizational or institutional changes, the complex interrelations between these changes and information technologies have significant implications for the way IT does and will affect the societies and economies of developing countries. As a matter of fact, the negative and controlling potential impacts of IT on these countries are a matter of great controversy among economists and politicians. The main short term issues usually discussed are the potential erosion of the comparative advantages of low labor costs, particularly in relation to assembly facilities, and the effects of automation, particularly on internal markets and international competitiveness. Implications of information technology for those countries hold great importance.3. Implications for Developing Countries The first direct effect of the micro-electronics revolution was the location of production for export in third world countries. While production of mainframe computers keep to be fixed largely in industrialized countries, production of smaller computers and of microelectronic devices, more subject to price competition, was shifted to low-wage locations, mainly in East Asia, where countries presented low wage costs as well as political stability, a docile labor force, and government incentives. Location of production for local and regional consumption followed, but the countries concerned were mainly middle income three quarters of US investment in third world micro-electronic industries was concentrated in 11 countries, viz. the four Asian dragons, India, Thailand, Malaysia, the Philippines, Brazil, Mexico, and Colombia (Steward, 1991).Export-oriented investments in these countries were associated more with direct foreign investment from larger firms in industrialized countries than with firms producing for the local market on the other hand, licensing was more associated with smaller firms (Tigre, 1995). The automation of production decreases the relative importance of labor-intensive manufacturing and cost of labor, thereby eroding the competitiveness of low labor costs. For instance, automation led to a sharp decrease in the difference between manufacturing costs of electronic devices between the United States and Hong Kong in manual processes, manufacturing costs were three times higher(prenominal) in the United States, and the introduction of semi-automatic processes made the difference practically dis appear (Sagasti, 1994). Equally, the expansion of automation in Japan has contributed to a reduction of Japanese investments in the Asia/Pacific region involving firms in electronics, assembly separate, and textiles (Sagasti, 1994).The trend to increasing systems optimization and integration is most likely to induce large producers in industrialized countries to produce back a significant share of their production located in developing countries (offshore production). This movement has been called comparative advantage reversal. As integration increases, with functions previously obtained by assembling pieces being incorporated in the electronic components, value-added is pushed out of assembly processes into the components themselves and upwards towards servicing. In addition, the growing technological complexity of electronic devices increases the value of the parts manufactured by firms located in industrialized countries The amount of value-added obtained in offshore assembly h as thus been constantly decreasing (Sagasti,1994).Global factories constructed in locations of least cost, oftentimes at a considerable distance from final markets, were economically worthwhile because labor was one of the major determinants of costs. Technology and rapid responsiveness to inconstant local markets are becoming more important components of competitiveness. The reduction of product cycles due to the growing resistance to obsolescence of programmable machines and equipment has led to a concentration of manufacturing investment in capital-intensive flexible manufacturing, further adding to the erosion of the comparative advantages of developing countries. The assembly of systems will probably continue in some developing countries that have adopted contraceptive legislation for local production targeted at particular market segments (e.g. Brazil), although this is changing very rapidly (Steward, 1991).The types of equipment produced under these circumstances are used largely in internal markets and are hardly competitive on the international level they tend to be far more expensive than comparable equipment available abroad, and often their installation and use are also more costly because of expensive auxiliary installations, under-use, and lack of management skills. Nevertheless, they may at least provide the ground with the capacity to follow the development of information technologies more closely. In other countries, assembly of equipment is taking place from components bought practically off the shelf, but as the level of hardware integration and the amount of software incorporated into the chips (firmware) grow, valueadded will be taken away from the assembly process, reducing or eliminating its economic advantages.The introduction of microelectronics requires certain new skills of design, maintenance, and management, as well as complementary infrastructural facilities such as reliable telephone systems and power supplies. Deficiencies i n these factors prevent the widespread adoption of information technology in developing countries (Munasinghe et al., 1985). The more advanced developing countries, with a wider basis of skills and infrastructure and a more flexible labor force, may be in a better position to adopt IT and to increase their productivity and their international competitiveness. But the less developed countries, with inadequate skills and infrastructure, low labor productivity, and lack of capital resources, will find it difficult to adopt the new technologies they are likely to suffer a deterioration in international competitiveness vis--vis both industrialized and the more advanced developing countries (Stewart et al., 1991).Quality, too, requires an adequate level of skills, infrastructure, and managerial know-how that is generally lacking in developing countries. This greatly reduces the synergies, number of options, faster responses, and more informed decisions that can be implemented in the firm by the optimization of the systems performance. In turn, the composition of the labor force existing within firms located in industrialized countries will further improve their systems performance and further reinforce the advantages derived from automation. The proportion of the labor force employed in production is constantly decreasing in the industrialized countries, implying that performances at the systems level and innovation, not manufacturing, are becoming the key to profit, growth, and survival (Sagasti, 1994).Like biotechnology, information technology is a proprietary technology, vital technical information regarding design engineering specification, process know-how, testing procedures, etc., being covered by patents or copyrights or closely held as trade secrets within various electronic firms from industrialized countries. Many companies in the software area do not patent or copyright their products because it entails disclosing valuable information, and firms are gene rally reluctant to license the more recent and advanced technologies. Therefore, technology transfer takes place mainly among established or important producers, hindering the recover to developing countries. Moreover, the main issue facing developing countries is not so much the access to a particular technology but to the process of technological change, because of the dynamism of this process. Sagasti implies this issue in the book The Uncertain Guest science, technology and development (1994) that recent trends in inter-firm relationships seem to indicate that this access takes place basically through the participation in the equity of the company holding the technology.

Starbucks External Environment

Starbucks External EnvironmentThis report is prepared for Starbucks hot chocolate Company Starbucks by a Specialist Marketing Consultant, to analyse the strategical position for Starbucks in the Specialty Coffee Indus accent. It volunteers a summary of all the major findings and, explores various strategic options and recommendations for Starbucks in cabaret to increase and maintain its competitive advantage within the application.Starbucks is a global leading brand, well k right awayn for its specialization drinking chocolate. The umber house does non yet sell high-quality deep browns, but besides Italian style beverages, cold beverages, complimentary food items, premium teas and coffee-related accessories. It has further retained its competitive advantage by selling packaged coffees and teas, ready-to-drink beverages, ice creams and many approximately otherwise products in other sell stores such(prenominal) as super commercialises through licensing relationships.Key FindingsStarbucks is facing various issues, nearly of which includeMaintaining the Starbucks Experience for clients and not being seen as just a money making machineStore ExpansionCompetition from fast-food irons and other specialty coffee retailersGenerating more hireLowering input costsKey RecommendationsBased on the strategic findings, the report outlined several recommended strategic options, the mains ones of which areTo improve the subliminal and express aura of Starbucks by supporting more good causes and paying its proper taxes.To increase revenue at trim back costs, Starbucks must try and search for more licensing relationships and expose the brand further.Existing stores could attract more customers, particularly aft(prenominal) the morning peak times by offering non-coffee beverage options or products for specific groups such as retired people.The recommended policies will help to enhance and strengthen Starbucks market share in the specialty coffee patience.Backg round Information on Starbucks Coffee Company (Starbucks)Starbucks was incorporated in the year 1971 by its founding directors Jerry Baldwin, Zev Siegl and Gordon Bowker. The Company was set up to operate as a roaster and retailer of whole bean and ground coffee, tea and spices together with coffee making equipment in Pike Place Market in Seattle, cap (Starbucks 2013b).In the year 1987, the original protesters sold the Starbucks chain to former employee Howard Schultz, who is now the current Chief Executive Officer (CEO) of Starbucks. Schultz re-branded his already existin II Giornale Coffee outlets as Starbucks and quickly began to expand (Grant 2010) as he believed thatFrom the beginning, Starbucks set out to be a distinguishable kind of company. One that not only celebrated coffee and the rich tradition, but that also brought a feeling of connection (Starbucks 2013a).Starbucks has truly essential a unique brand experience, one which is the most respected and acknowledge aro und the world (Starbucks Annual Report 2012). Today, it is known to be one of the gargantuanst and best established American global coffeehouse chains (Grant 2010). It has grown to turn out over 20,800 stores in over 60 countries, with the United States having the highest number of stores, followed by Canada. The UK has approximately 806 stores. However, countries like India, the second most populous country in the world, has only circa 8 stores (Loxcel Starbucks 2013).Critical Evaluation of the door guard Five Forces ConceptAll organisations need to understand the dynamics of their industries and markets in order to compete effectively and intensively in the market place.An American management writer Michael Porter came up with a framework called Porters Five Forces (Porter 2008). The framework abstract the attractiveness of an organisation and or/industry structure, determines the main impertinent competitive threats, and assesses the extent to which the five forces are releva nt to the organisation and/or industry (Hollensen 2003Purcell 2013).The five fundamental competitive forces include (1) Rivalry, (2) Buyer Power, (3) Threat of Entry, (4) Supplier Power and (5) Threat of Substitutes (Porter 2008) (Figure1 Porters Five Forces modeling). These five forces, as explained above, aid an organisation to understand two strengthsThe current competitive built in bed and,The strength of a position it would like to move into (Purcell 2013).Michael Porter simplified the micro-economic theory into the above five major influences. Each of these influences take into account demand and supply, corresponding products as well as substitutes, the relationship between volume and production and the cost of production, and the structure of the market such as oligopoly, monopoly etc. (Grundy 2006Porter 2008).Apart from that, the value of information abstracted from the Framework analysis, assists to fuel three aspects of corporate planningStatistical analysisThe attract iveness and profitability of an organisation/industry can be fixed by victimisation Porters Five Force Analysis, thereof supporting decision making on whether to enter/exit from an industry or market segment (Porter 2008).Furthermore, the framework considers and takes into account the impact of competitive forces on the organization (RAPIDBI 2012) itself versus impacts on its competitors (Ketels 2006). Due to the availability of unalike resources and levels of competences, the competitors may agree different reactions when there is a change in competitive forces, hence influencing the structure of the whole industry (Grundy 2006Ketels 2006).Dynamical AnalysisA combination of two Porters Five Force Analysis and a PEST- Analysis (Political, Economical, Social, Technological), will disclose clues on how attractive the organisation/industry will be in the emerging (Porter 2008). This is because a change in Political, Economical, Socio-demographical and Technological aspects of or ganisations/industry can be influential on the five competitive forces and, hence will impact on the industry structure (Karagiannopoulos et al. 2005).Analysis of OptionsImprovement of an organisations own competitive position can be influenced by having some knowledge on both the compass stay of intensity and power of competitive forces (Recklies 2001). A upstart strategic direction can be derived from this such as new positioning in the market and differentiation for competitive products (Porter 2008).Accordingly, Porters Five Force Framework allows an organization to analyse the market structure and competitive situation in a more magisterial and structured way (Recklies 2001). Once all relevant forces for that particular market are identified and analyzed, managers can find options that influence these forces, subject to the organizations interest (Grundy 2006Ketels 2006Recklies 2001). juvenile research has shown that Porters Five Force Framework has got both strengths and w eaknesses when used in todays dynamic environment, the main weakness highlighted has been the historic nature of its development (Grundy 2006). Cyclical proceeds in the 80s showed that the global economy had been fairly stable and predictable, compared to the current economy (Grundy 2006).Several limitations to the Porters Five Force Framework have been shown asFrom the economic point of view, the framework is under the presumptuousness that the market is perfect (Rivard et al. 2006). As a result, the framework will not be able to deliver meaningful insights on highly regulated industries (Grundy 2006)) .The applicability of the framework is more towards the analysis of simple market structures, rather than those which are in a much more hard industry (Grant 2010). As a result, the framework is limited to focusing on particular segments of such industries. This imposes an increased risk in omitting important elements (Grant 2010) .The framework assumption on having moderate stati c market structures makes it a non suitable framework for todays dynamic markets. caper models, entry barriers and relationships may change along the supply chain within a snapshot due to technological breakthroughs and dynamic market entrants (Karagiannopoulos et al. 2005). As a result, the framework could be a preferred model to be used at a later stage for analyzing new situations however, it is limited to and perhaps not ideal to a certain extent to provide burden actions (Rivard et al. 2006) .Porters Framework is based around the idea of competition, hence the name competitive forces. The assumption made by the framework is that a company will try to attain competitive advantage over the various players in the markets together with suppliers or customers (Aktouf et al. 2005). As a result of this, the framework only focuses on such aspect of strategy rather than taking into consideration the availability of strategic alliances, virtual enterprise- networks or others (Aktouf e t al. 2005).Overall, Porters Five Forces Framework has limitations because it does not take into consideration new business models and the dynamics of the market place (Recklies 2001).This report will now apply the Porters Five Force Framework to Starbucks Coffee Company (Starbucks) which is a spectacular specialty coffee tell on popular in most western countries such as the United States of America, United Kingdom and many others.Critical Analysis of Starbucks External EnvironmentWithin the rapidly changing global picture, companies and consumers are increasingly affected by global forces, represented as non-controllable. These forces are external environmental influences which must be monitored and responded to, on an ongoing basis by marketers, as they will lead to new opportunities and threats (Kotler 2007).An external environmental analysis, using the macro-economic ruminator model was carried out for Starbucks and has been attached at Appendix 2 of this report.It can be see n from the analysis at Appendix 2 that there is currently a negative imbalance in Starbucks external influence matrix. This is because whilst the sociologic factors are favourable, whilst other factors such as Political, Economic and Legal show substantial threats.However, Starbucks has got some strengths that over-come some of these non-controllable influences from the external environment. It has built in flexibility to change, for example, agreeing to pay extra corporation tax in the UK, for the next two years (BBC News bloodline 2013), or relating to the closure of non-profit making stores, and lastly it has developed high powered management decision making process which ensures that is quick at exploiting opportunities (Patton 2012).Critical Analysis of Starbucks business EnvironmentMichael Porter (1985) posits that, in an attempt to find effective sources of competitive advantage, a thorough research should be conducted on the structure of the industry. In this case, an anal ysis of the particularity coffee industry can help to establish the strategic position Starbucks oc formies and wishes to occupy. Porters Five Forces model is a useful tool in this regard. It shows how fundamental elements have shaped the competition in the industry (Hill and Jones 2009).Buyer powerIn the specialty coffee industry today, consumers have wide access to different products at different prices with offend quality services (Hunt et al. 2011). This practically means that individuals have the choice to easily switch from product to product, whichever is the preferred one. This is where Starbucks has an advantage it decides on the prices of the drinks offered to its consumers, by taking into consideration the price-elasticity which is strongly influenced by loyalty to its brand and also current prices at rival stores (Grant 2010).Since Starbucks is known to be an up-market coffee shop with high quality, based on perception and offering vertically differentiated products it is very likely for it to be able to sell its products at high prices, hence leaving no room for price-negotiation with its customers (Grant 2010).Supplier powerIn 2008, Starbucks purchased its input goods from suppliers at a market price which was 23 per cent lower than it is now (Corporation, 2008) It also takes advantage of its size and benefits from economies of scale, however, this does not help Starbucks to increase its number of suppliers due to the circumstances within Starbucks own marketplace (Grant 2010). Prices are usually determined based on the demand and supply ratio, hence, with an increased level of competition (Kotler 2007), substitute suppliers are always available if Starbucks wishes to purchase at a different price point. Despite all the supplier conditions, Starbucks holds a better relationship status with its suppliers than most of its competitors (Starbucks, 2013).Threat of substitutesProduct-for-product analysis together with an analysis of generic surrog ate is an important area to consider for Starbucks, since 14% of coffee drinkers have a favourable opinion for them (Rasmussen Reports 2011).The vast variety of the availability of different beverages such as soda, energy drinks, juices or water, in comparison to coffee, must be taken into consideration by Starbucks. However, this is not of a huge concern to Starbucks since it sells a large selection of these beverages within its stores, the biggest one being tea, a direct substitute to coffee. Starbucks has taken the initiative to sell this direct substitute product under its own Tazo tea leaf brand (Starbucks 2013).There is quite a concern when the threat of customers substituting away from Starbucks and going for direct competitors such as Caf Nero and Costa Coffee (for example in the UK) is considered. These direct competitors are hard to differentiate because they also truly pride themselves on customer services and on the quality of their speciality drinks. Large food chain c ompetitors such as McDonalds are usually known as having a negative undertone of being cheap, often pliable on the quality of coffee. This has no effect on Starbucks targeted customer base (Grant 2010).Threat of entryThe barriers to entry in the specialty coffee market, such as the one Starbucks operates in have increased. This has reduced the probable threat of new entrants (Patton 2012).The capital requirement for handsome coffee shops in this industry is relatively small as the shops require a small amount of floor space and not a high amount of applied science is used, which is normally the biggest start-up cost. As a result the potential for more of these small coffee shops to enter the industry is still present (Articlesbase 2011).Industry RivalryMcDonalds and other fast food chains are key competitors which are diversifying their beverage menu. The direct competitors like Costa Coffee and Caf Nero compete on a much more of a pair with Starbucks compared to the fast food chains, as they attract the same consumer base and offer similar products as in the way Starbucks does.Starbucks differentiates itself from other coffeehouses as it reaps high margins from its specialty drinks. This is because it takes advantage of economies of scale and has a different cost structure in contrast with other competitors in the market. They pay less for the products bought in bulk, such as dairy goods, syrups, paper goods etc (Starbucks 10K 2010).Strategic RecommendationWhether Starbucks coffee has the actual quality to attract customers or whether there is just a perception of it being better than that of competitors has been the subject of much discussion on public media through many recent surveys and reviews. Irrespective of that, some possible strategies to be considered by Starbucks in order to maintain its market position are as followsStrategy to renew the Starbucks brand name.To maintain a strong brand name, Starbucks will have to hold back people that the ir coffee is better than all other beverages, be it McDonalds coffee or Costa Coffee by introducing a more aggressive advertise campaign in order to educate and acquaint customers about the uniqueness that Starbucks quality offers as well as by diversifying advertising channels using internet, visual media etc instead of depending on employee-customer liaison (Starbucks, 2013)Product DifferentiationProduct differentiation is very vital in order to develop new flavour, blends and also roast fusions (Ross Gaddis, 2013) Starbucks should continue its coffee development program efforts through extensive research. This should continue to be done by providing free samples, at first, leading to debut the new product into all stores depending on what response it gets from the samples distributed (Porter, 2008)Due to the recess, consumers try to cut their spending and are less likely to buy a cup of coffee for 2.50, and therefore, differentiation can be a useful tool to overcome economic downturns (Moon, 2010) Starbucks can promote new cost efficient products by selling them at lower prices, hence not affecting its luxury-premium status in the market. This strategy can help Starbucks retain its customers as well as intensify their brand name.Privilege Card and Rewards ProgramStarbucks Card program for consumers to reload credit online has been implemented in order to not only provide customers with rewards on online registering but also benefiting them with complementary beverages after a certain number of purchases, free refills as well as free syrup options (Starbucks, 2013). However, other competitors also have similar strategies for consumers and this leads Starbucks to offer distinct rewards in order to deliver incentives for coffee consumers as compared to its rivals. For instance, Starbucks could cooperate with airline companies and various large retail businesses so as to combine their rewards program with Starbucks (Hill Jones, 2010)Focus on the coffeeStar bucks should also consider cost reduction as well as potential growth strategies especially at the time of economic downturn. For example, Starbucks has begun to invest in new businesses other than coffee, such as films, music and books (Starbucks, 2013) This has led Starbucks to incurring higher costs and lower profit margins but this can be prevented by focusing on different marketing techniques to reach a wider audience. In these recessionary times, involving itself in fewer businesses can help Starbucks cut down costs and more resources can be utilised to improve their core product, which is coffee (Moon, 2010) in effect(p) Store Expansion DecisionThe launch of more stores has had to be reduced or halted completely in order for Starbucks to survive at the time recession in the United States. In the year 2007, Starbucks opened about 1700 stores today it has around 15000 stores and still aims to build the number of stores up to 40000 in the foreseeable in store(predicate) (Corpor ation, 2008) Taking into account its overall financial performance as well as the downfall in the economy, it is best if Starbucks focuses on renewing its brand and customer base rather than opening stores at present (Omer, 2008).The Starbucks FeelPeople enter a Starbucks store not just for a cup of coffee but also for the relaxed environment and the opportunity to de-stress for a while. The initiative to write customers names on their cups adds to this club atmosphere. This Starbucks feel needs to be further developed and sold to the customers.SECTION 6ReferencesAktouf, O., Chenoufi, M., Holford, W.D. 2005. The False Expectations of Michael Porters Strategic Management Framework. Problems Perspectives in Management (4) 181 available from http//connection.ebscohost.com/c/articles/19299836/false-expectations-michael-porters-strategic-management-frameworkArticlesbase 2011. The Initial Capital Investment in jump a Coffee Shop Business. Articlesbase available from http//www.articlesb ase.com/entrepreneurship-articles/the-initial-capital-investment-in-starting-a-coffee-shop-business-5185126.html Accessed 18 April 2013.Business, N., 2011. www.bbc.co.uk. Online Available at http//www.bbc.co.uk/news/business-20573208 Accessed March 2013.BBC News Business 2013. Starbucks rejects tax row threat after Cameron Speech. BBC News Business available from http//www.bbc.co.uk/news/business-21219823 Accessed 12 April 2013.Corporation, S., 2008. www.nytimes.com. Online Available at http//topics.nytimes.com/top/news/business/companies/starbucks_corporation/index.html Accessed 2013.Grant, R.M. 2010. Contemporary Strategy Analysis Text scarce John Wiley Sons.Grundy, T. 2006. Rethinking and reinventing Michael Porters five forces model. Strategic Change, 15, (5) 213-229 available from http//dx.doi.org/10.1002/jsc.764Hill, C. Jones, G., 2010. Strategic Management Theory. USA South-Western Cencage Learning.Hill, C. Jones, G.R. 2009. Strategic Management An Integrated Approach Th eory South-Western/Cengage Learning.Hollensen, S. 2003. Marketing management a relationship approach Financial Times/Prentice Hall.Hunt, K.A., Durango, C.O., Fate, J. 2011. Cultural and Social Influences on the Perception of Beauty A Case Analysis of the Cosmetics Industry. Journal of Business CaseKaragiannopoulos, G.D., Georgopoulos, N., Nikolopoulos, K. 2005. Fathoming Porters five forces model in the internet era. info, 7, (6) 66-76 available from http//dx.doi.org/10.1108/14636690510628328Ketels, C.H.M. 2006. Michael Porter Competitiveness FrameworkRecent Learnings and New Research Priorities. Journal of Industry, Competition Trade, 6, (2) 115-136 available from http//search.ebscohost.com/login.aspx?direct=trueAuthType=athens,cookie,ip,urldb=bthAN=22555133site=ehost-liveKotler, P. 2007. Framework For Marketing Management, 3/E Pearson Education.Moon, H.-C., 2010. Porters Generic Strategies. In Global Business Strategy. Singapore World Scientific Publisher Limited, pp. 10-20.Ome r, 2008. Porters Generic Model. Porters Model of Generic Competetive Strategies, 43(3), pp. 55-64.Patton, L. 2012. Starbucks go After Cutting Forecast Below Estimate. Bloomberg Businessweek available from http//www.businessweek.com/news/2012-07-26/starbucks-falls-after-cutting-fourth-quarter-profit-forec Accessed 15 April 2013.Porter, M., 2008. Competitive Strategy. 2nd ed. New York The Free Press.Porter, M.E. 2008. THE FIVE COMPETITIVE FORCES THAT SHAPE STRATEGY. Harvard Business Review, 86, (1) 78-93 available from http//search.ebscohost.com/login.aspx?direct=trueAuthType=athens,cookie,ip,urldb=bthAN=28000138site=ehost-live Accessed 25 March 2013.Purcell, S. 2013. The Strategic Planning Process Part 1. Student Accountant Technical available from http//www.accaglobal.com/en/student/qualification-resources/acca-qualification/acca-exams/p3-exams/exams-p33.html Accessed 31 March 2013.RAPIDBI 2012. Porters Five Forces for competitor anaysis and advantage. Porters Five Forces Competi tor Analysis available from http//rapidbi.com/porterfiveforces/ Accessed 24 April 2013.Rasmussen Reports 2011. Coffee Drinkers Buy Starbucks More But Like Dunkin Better. Rasmussen Reports available from http//www.rasmussenreports.com/public_content/ lifestyle/general_lifestyle/february_2011/coffee_drinkers_buy_starbucks_more_but_like_dunkin_better Accessed 16 April 2013.Recklies, D. 2001. A Critique of the Critique of Porter. Porters Five Forces available from http//www.themanager.org/Models/P5F_2.htm Accessed 21 April 2013.Rivard, S., Raymond, L., Verreault, D. 2006. Resource-based view and competitive strategy an integrated model of the contribution of information technology to firm performance. The Journal of Strategic Information Systems, 15, (1) 29-50 available from http//dx.doi.org/10.1016/j.jsis.2005.06.003Ross, R. Gaddis, D., 2013. Product Differentiation. Strategic Management Journal , 34(5), pp. 509-532.Starbucks, 2013. www.starbucks.co.uk. Online Available at http//star bucks.co.uk/ Accessed April 2013.Starbucks 2013. Starbucks Tea. Starbucks Corporation available from http//www.starbucksstore.co.uk/tea/tea,en_GB,sc.html?cm_mmc=Google+UK-_-Brand-+Starbucks+Tea+(UK+Lang)+(Exact)-_-Starbucks+General-_-Starbucks+Generalgclid=CPbS6vPW17YCFXIPtAodmVgAgQ Accessed 18 April 2013.Starbucks 10K 2010. Starbucks Annual Report. Starbucks Corporation available from http//www.sec.gov/Archives/edgar/data/829224/000119312510266333/d10k.htm Accessed 19 April 2013.The Boston humankind 2008. Starbucks testing sales of 8-oz. cup of coffee for $1. The Boston Globe available from http//www.boston.com/business/articles/2008/01/24/starbucks_testing_sales_of_8_oz_cup_of_coffee_for_1/ Accessed 18 April 2013.The New York Times 2008. Starbucks Plans Return to Its Roots. The New York Times available from http//www.nytimes.com/2008/03/20/business/20sbux.html?scp=3sq=starbucksst=nyt_r=0 Accessed 19 April 2013.

The Aims and Objectives of an Islamic Bank

The Aims and Objectives of an Moslem beachMuslim swaning is becoming increasingly popular and plays a heavy(a) role in the financial services firmament in Malaysia. According to latest statistics shown, the Muslim population of Malaysia is approximately 25 million. There is definitely a strong demand and strong growth authorisation in this sector. In Malaysia, the cashboxing sector is mainly dominated by the unoriginal desireing constitution whereby interest is non be prohibited. It is because the Muslim bordering constitution is relatively new and there argon insufficient regulations at present to govern them. If these obstacles are world resolved, the Moslem Banking sector will blossom given the influence of Malaysia in the international Muslim community.The primary aim of this research is to examine and understand in depth the ontogeny of Islamic banking in the world of finance. This piece of research can be separate into three sections. The first section looks at significant differences between naturalized banking and Islamic banking. Products and services offered by these financial institutions will be marked to comparison. The second section looks at how the practice of Islamic banking started and how it has emerged to become a ampul force in the economy. The final part of the research will focus on how the Islamic banks penetrated the Malaysian market and the challenges face up.1.1 Structure of DissertationThis dissertation is divided into a few topics and each topic covers different areas of research. This is to give readers a clearer view of the research and make it more than user-friendly. It is well thought and designed to verify the smooth flow of the reading. The structure of the dissertation can be summarized as followsChapter 1 This chapter describes the aims and objectives of this research.Chapter 2 This chapter discusses the principles and fundamentals of Islamic bankingChapter 3 This chapter explains in detailed the p ut forward and scope of Islamic banking industry in Malaysia. I ca-ca in addition mentioned to objectives and roles the Malaysia planetary Islamic Financial Centre Initiatives plays in the industry.Chapter 4 Research methodologies and strategies that were being adopted for this paper was discussed.Chapter 5 I have marked two Islamic banks in Malaysia for side by side comparison. I have skeletal up a table to compare their financial performance and position over the past two years.Chapter 6 I have interviewed two Islamic bankers from Malaysia. On top of that, I have alike provided my in-person analysis of their answers.Chapter 7 Competition and globalization of the Islamic banking industry. Moreover, I have also discussed opportunities and challenges faced in the world and in Malaysia.Chapter 8 A summary of the paper was included with recommendations and limitations to research.2 INTRODUCTIONSo, what exactly is Islamic Banking? Islamic Banking is banking based on Islamic laws ( shariah law). The Shariah principles are derived from the Quran and the Sunnah (sayings of Prophet Muhammad). Moreover, secondary sources of Islamic laws much(prenominal) as opinions collectively concord among Shariah scholars, analogy and personal reasoning are also adopted in the rules and practices of Islamic banks (Al-Omar, 1996).The research then looks at the differences between pompous banking and Islamic banking. There governing principles of Islamic banks areRibaAbsence of interest-based transactions. Charging of interest is prohibited under Shariah principles. Money itself does not have inherent value and should not be used to manufacture more money. Wealth can only be generated through legitimate trade and investment.GhirarActs of speculation are not accepted under Islamic principles. For instance, purchasing goods now at lower price in the hope of selling them at higher price in future. The reason being speculators make clubby gains at the expense of society at lar ge.ZakatIntroduction of Islamic tax for the purpose of wealth distribution so that every Muslim is guaranteed a jolly standard of living.HaramIt is forbidden for Islamic banks to finance activities forbidden in Islam much(prenominal) as prok meat and alcoholic beverage. In order to check that the trading activities do not contradict with Shariah principles, all Islamic banks are required to enclothe up Shariah Committee, who acts as advisor to the banks.On the other hand, naturalized banks charge interest on transactions. These interests are widely seen as price of credit. Furthermore, conventional banks focuses on elimination of risks and thus do not share every liabilities with the borrower.(Figure 1)Islamic Bank Vs Conventional BankBased on Shariahprinciples.Based on best economic principles.Bank should not take advantage of borrower. No interest charged.Charges interest to reflect price of credit.Does not allow involvement in haramactivities such as pork meat and alcoholic beverage.Aims at maximizing profit without restrictions other than compliance with relevant regulatory frameworks.Intoduction of zakat.Non-existence of zakat.Promotes risk sharing between providers of credit and borrower.Interest is assured to providers of credit. No liabilities borne by the bank.Emphasis fit(p) on viability and feasibility of projects.Emphasis placed on credit-worthiness of customers.Only provide guarantee for gear up ac calculate (al-wadiah). If funds placed under mudarabah accounts, customers shares profit or loss incurred by bank.Provides guarantee to all its depositors.www.learn islamicfinance.com2.1 Fundamentals of Islamic Banking financeIslamic commercial law is based on a few major(ip) principles. They will be discussed in detailed as followsMusharakah (Partnership Finance)Musharakah is a contract in which the bank and the client contribute jointly to the capital of a circumstantial project or deal to make a profit. Therefore, risks of profits and losses are being shared between these two parties according to terms and conditions stipulated in the contract. This principle exposes bank to the risks of the project, in other words protecting the interests of the community. This will prevent banks from yielding their unfair influence and sells disadvantage products to clients.Mudarabah (Trust Financing)Mudarabah is a contract in which the banks provides all the capital required whilst the partner contributes in terms of skills, experiences and efforts. The bank receives a pre-determined share of profits as agreed by both parties upon startle of the project. The major difference between mudarabah and musharakah is that in this case, the bank bears all financial loss whilst the client goes unrewarded. Therefore, it is also the banks responsibilities to assess the feasibility and viability of the project. As such, it is vital for the bank to have a good and credible credit system to evaluate all its exposures on these projects. In short, this principle encourages individuals to participate in financial activities It also gives individuals without sufficient resources an opportunity and platform to prove themselves in the society.Murabaha (Cost-plus Financing)Murabaha is a contract in which the banks informs their client about the acquisition price of certain goods and products and sells them with a margin. It requires the bank to declare an honest price of acquisition. It is one of the most common principles adopted in Islamic banking system to promote interest-free transactions. It is widely practiced in addition financing and both commodity import and export.Bai-Muajjal (Deferred Payment Sale)It is a contract in which the seller sells a certain goods or products to the buyer at an agreed fixed price to be paid later at a specific date by the buyer. In short, it is a sale on credit. The bank merely acts as the financier by deferring the receipt of the sale price of goods it sells.Ijara (Leasing)In this case, the bank buys capital equipment or property and leases it out under component to clients. Similar to conventional leasing, the client has the option to purchase the goods at the end of the lease period. The fact that there is real good to be financed means that it is Shariah compliant. A very common product adopting this principle is Islamic mortgage whereby the buyer buys the property on an instalment basis.Qard HassanIslamic teachings promote brotherhood amongst Muslims. Qard Hassan is seen as a gratuitous loan that helps fellow Muslims who need financial assistance. It can be defined as a loan to be repaid at a later date without incurring any interests. According to Rob (1992), Islamic banks may raise funds through sale of shares to public and main deposit accounts. Therefore, the bank has a responsibility to lend a helping hand to those in desperate situation without taking of their advantaged position.2.2 Compatibility of Islamic Banking with Conventional BankingIslamic banking s ystem has very similar features to conventional banking except that Islamic banks operate in compliant to Shariah laws and principles. Both banking systems have common features and common products. The main differences being prohibition of interests being incurred and sharing of profits and losses between banks and their clients (Abdur Rahim, cc9). They have the same objectives except interpretation of interest. Islamic banks fall into realms of the economic world as well. They try to ensure all their operations comply with Shariah laws yet at the same time conform to rules set by international bodies such as International Accounting Standards Board and Audit Practices Board. This is to ensure they remain relevant to the society and at the same time conform to their religious principles. Islamic banks sell products such as mortgages, savings accounts, insurance which is also sold by all conventional banks across the world. According to Nienhaus (1995), Islamic banks offer facilities more or less the same as conventional banks, in compliance with the welfare principles of Islam.3 LITERATURE REVIEWA literature review is a process in which published articles or information are studied as part of the research for the preparation of a dissertation. For the purpose of this project, I have gathered information from books and articles from discordant sources. I have studied the concept of Islamic banking, having limited understanding about this topic previously. Further, I have also included discussion about the development of Islamic banking in the world, and in particular, Malaysia. This paper allows readers to have a good grasp of Islamic banking in world-wide. It gives readers the opportunity to study about Islamic banking in greater detail when the interest of this industry gathering strong momentum. This is of particular importance because Islamic banking has a huge impact of the world economy because of the strong influence of the oil-rich Gulf States.3.1 In troductionSince a few decades agone, Islamic banking has emerged as a new reality in the world economy. Its philosophies and principles are however, not new, having been outlined in the Holy Quran and the Sunnah of Prophet Muhammad (p.b.u.h.) more than 1,400 years ago. The emergence of Islamic banking is often related to to the revival of Islam and the desire of Muslims to live all aspects of their live in accordance with the teachings of Islam (Siddiqi, 1983).This chapter provides a brief overview of how Islamic Banking was introduced in the World and how it penetrated the Malaysian market. Islamic banking nowadays has proven to be a popular and reliable financial system in the world. It is widely seen as a viable alternative to the conventional banking system over last 3 decades. Islamic banking was described by scholars as wishful thinking when the idea was first mooted almost thirty years ago (Iqbal and Philip, 2006). Many conferences and discussions were carried out at that t ime to work on the finer details of this system. Several blueprints were drafted by Islamic scholars from all over the world to ensure a detailed system is created.The first international conference on Islamic Economics was organized by Kings Abdul Aziz University in Makkah marked an important milepost in the history of Islamic banking (Iqbal, 2005). Financial gurus, economic experts and Islamic leaders were invited to present their view and opinions.Following this, the first Islamic bank, Dubai Islamic Bank (DIB) was constituted in the United Arab Emirates in 1975. Since its formation, it has established itself as the leader in the industry and has won several accolades internationally. In 2009, it recorded net profit of 200 million with assets worth over 14 billion. Islamic banking has gained tremendous momentum and has been growing rapidly over the years. Islamic banks now offer products in various areas such as banking, insurance, mortgage and asset management with annual growt h of 10% for many years.3.2 History of Islamic Banking in MalaysiaIslamic banking industry in Malaysia is growing at a moderate pace. It is a unique market because Islamic banks in Malaysia are allowed to operate in parallel to conventional banks (interest-based). The multiethnic population of Malaysia makes the entire change of financial system to follow the Shariah system not viable. Government of Malaysia opted for gradual fashion of introducing Islamic banking by allowing conventional banks to sell Islamic banking products and services such as sukuk (Arif, 1989). The dual banking system has been recognised by both West and East leaders and it is seen to be the sticker of the future. In fact, many underlying bankers have visited Malaysia to see the effectiveness of this dual system first hand. Furthermore, this dual system also eliminates the wrong concept of general public that Islamic banking products are sold exclusively to Muslims.The history of Islamic banking industry g oes back to as far as 1963, when the foresighted government set up the Lembaga Tabung Haji also known as the Pilgrims Management and Fund Board. It was set-up primarily to encourage Muslims in the country to save up on their income in order to perform pilgrimage in Mecca (Kamarulzaman Bhupalan, 1983). Besides, the fund was also created to provide a platform for participation in the economic and investment activities. Based on the success of the Lembaga Tabung Haji, coupled with the consultation of Shariah experts and economic gurus, government then proceeded to set up the first ever Islamic Bank in 1983. saddle horse up of Bank Islam Berhad Malaysia (BIMB) marked a milestone in the banking industry. It proved to be hugely popular because over half the Malaysian population are Islam followers. What followed through was the listing of the bank in the stock exchange of Malaysia in the early 1990s. As of today, the bank has 100 braches located all over Malaysia.With the fairytale of BIMB, central bank decided to allow commercial banks and merchant banks to offer Islamic banking products under the Islamic Banking Scheme. It was not long after that the central bank set up the National Shariah Advisory Council to oversee all issues pertaining to Islamic Banking.Due to the economic liberalisation, central bank finally grants licenses to foreign Islamic banks to operate in Malaysia in 2004. Al-Rahji Bank and capital of Kuwait Finance House took full advantage of this ruling and step foot into the Malaysian banking industry. The last count of Islamic banks operating in Malaysia stood at 21.3.3 Scope of Islamic Banking in MalaysiaIslamic Banking started out as mere deposit taking and lending zeal has since transformed into all aspects of banking, money and capital market operations. In Malaysia, the central bank is in favour of a dual banking system, whereby Islamic banks are allowed to co-exist with conventional banks. It is at the consumers choice to select which s ervices they prefer that cater to their needs. This is in stark contrast with the scenario in Iran and Pakistan, where conventional banking system is abolished completely to make way for Islamic banking. They claim to be devoid of conventional interest based financial transactions.Today, the Malaysian Islamic banking sector is blossoming as reflected in the prolonged distribution networks comprising 152 full-fledged Islamic banking branches. The ability of these Islamic banks to offer competitive products with attractive and innovative features has attracted both Muslim and non-Muslim population in the country. This has also spurred non banking institutions such as savings institutions to introduce Shariah compliance product to appeal to a wider consumer base.According to Association of Islamic Banking Institutions Malaysia, there are 21 Islamic banks who have subscribed to their membership. The list of Islamic banks is provided as followsAffin Islamic Bank BerhadAlliance Islamic B ank BerhadAl-Rajhi Banking Investment Corporation BerhadAmIslamic Bank BerhadAsian Finance Bank BerhadBank Islam Malaysia Bank BerhadBank Kerjasama Rakyat Malaysia Bank BerhadBank Muamalat Malaysia Bank BerhadBank Simpanan Malaysia BerhadCIMB Islamic Bank BerhadEONCAP Islamic Bank BerhadHong Leong Islamic Bank BerhadHSBC Amanah Malaysia BerhadKuwait Finance House (Malaysia) BerhadMaybank Islamic Bank BerhadOCBC Al-Amin Bank BerhadPT Bank Muamalat IndonesiaPublic Islamic Bank BerhadRHB Islamic Bank BerhadStandard Chartered Saadiq BerhadUnicorn International Islamic Bank BerhadAs evident from the list above, there are 21 banks offering Islamic products in the Malaysian market. Confidence is clearly shown on the Malaysian market with international banking powerhouse presence such as Standard Chartered group and Kuwait Finance House.The Governor of Central Bank Malaysia recently declared the central banks intention to lure larger overseas banks to provided services that comply with Mus lim tenets. As a sweetener to any potential deal, the central bank has raised foreign ownership limits at local Islamic banks and insurance companies to 70%. Rising oil wealth has turned the Islamic banking into an industry with assets with $1 trillion in assets globally. The central bank is doing its utmost, implementing initiatives to explore this relatively untapped market. In addition to the changes in foreign ownership limits, the central bank is also offering tax breaks for Islamic products and has relaxed rules for Islamic banks to trade in foreign currencies (Aziz, 2006). This is seen as a major breakthrough because the foreign currencies dealing is tightly regulated due to the impact Malaysian market suffered in the 1997 Asian Financial Crisis.In July 2010, Khazanah, Malaysia sovereign wealth fund made its entranceway in Singapore debt market issuing sukuk or Islamic bonds worth $1.5 billion, three times the size of Singapore sukuk market until now. This further strengthe ned the Malaysian government efforts to promote Islamic banking products both domestically and internationally.

Urban Design for Community Development | Case Study

urban Design for Community Development Case StudyIntroductionUrban bod is considered the practice of influencing and managing the urban environment. Its role and potential for creating better places in atomic number 18as with community issues shall be discussed with reference to Hulme, an study one mile south of Manchester city focalise. During the late 80s Hulme fell into a acres of inner city decay, it became a marginal area nonorious for crime, social deprivation and poor housing. However, during the early 90s an ambitious urban transition purpose c everyplaceing an area of 240 acres was created, the programme was entitled The Hulme City Challenge Initiative. This was managed by a joint venture comp some(prenominal), Hulme Regeneration Limited consisting of Manchester City Council and AMEC Plc everyplace the years a host of other unrestricted, private and community interests ready been involved.Hulme is an extreme case of an area with community issues some of which re main unresolved. However, more than 12 years since the programmes launch and with over 250 million invested into numerous regeneration projects it give ups a wealth of information for making clear points throughout the essay. Hulmes new qualities and past deficiencies go forth enable genuine connections to be made with urban design theories while highlighting possible measures one could consider when addressing areas with community issues.How do community issues turf out?When addressing community issues one of the first roles is to understand how the existing problems grow arisen. A rigorous transparent analysis should be conducted so that previous errors are not repeated because areas swept away in wholesale redevelopment are often the very areas which today are failing and undergoing signifi bumt change (CABE 2005, p.12). This occurred to Hulme during the 60s,.When several(predicate) social and ethnic underprivileged groups live together in marginal areas like Hulme they a ll generally have limited access to resources and rights while discordant communal tensions post arise from sparse customary lacunas. These limited public quadrangles experience pressures from various patterns of use from people living in flats without gardens, to those who spend a long clipping outdoors, like the homeless, drug addicts, loitering teenagers with nothing to do and migrants with instanterhere to socialise. This causes friction and competition between these groups who in turn intimidate others who want break away through or use these areas. Those intimidated usually withdraw themselves from these group dominated spaces they tend to be the elderly, disabled and young children. Incidentally, the 1960s Hulme design disheartened permeableness through the public realm it lacked revolution of space and available institutions, which created defensible areas and isolation. These past issues imply Hulme suffered from placelessness (Jacobs Appleyard 1987), whereby pe ople withdraw from community involvement to whoop it up their own private and limited worlds (Jacobs Appleyard 1987, p.115).Neglect and decline of space is common in marginal areas, but why is it we find litter ridden streets, vandalised outdoor furniture, twist heaps in parks, empty business units, areas of poor maintenance, and so forth. Some blame finish be directed towards the local authorities for the latter withal in this case one will address neglect shown from local residents. When residents allow their environment to fall into a state of decline it highlights their lack of fastening to place. Alternatively, the concerned minority believe any attempts to maintain the area will still be in vain. The lack of attachment with place squirt resolvent from transient inhabitants who feel no responsibility in looking after or respecting short-term, low- case accommodation and surrounding public spaces. As an area declines over time so does the case of life, it portrays a disposition of giving up within the community. For Hulme it became stigmatised with a negative perceptual image presented through dilapidated buildings and its depressing environment. This can have a knock on effect by deterring local businesses who fear no returns on their investment and are sceptic about security. This not only degrades public areas through reduced street activity and social integration but it reduces self-policing, increases unemployment levels which fuels localised crime from the resulting low levels of social organisation (Wilson, 1997 p.21). Hulme managed to force those with any aspirations out of its area through defining itself as an estate via its rigid zoning of activities and housing tenure. Its unstable and declining local population not only washy community bonds but assisted the process of residualisation in Hulme and hence crime figures rose.Working with and resolving community issuesHaving scratched beyond the surface of some common community issue s, one will discuss potential methods of approach suggested by urban design theorists. These will be cross referenced with several socially mend developments in Hulme.Selected PreservationFirstly one should strive to understand the collective social meanings and values communities place on their existing physical environment via long consultation with residents. This allows one to distinguish the character and uniqueness a specific place presents this may be through specific buildings, public spaces or landmarks. Calthorpe and Fulton state that conservation and restoration are practical undertakings that can besocially enriching (Calthorpe Fulton 2001, p.48). Therefore the urban designer should seek to maintain these focal points weaving them into future development, thus change the communities urban identity. Through preserving some familiar settings it provides a psychological comfort for long term residents specifically the elderly. One of the main and incidentally oldest buil dings conserved during Hulmes regeneration was the congregational Church for Zion Institute, built in 1911. This iconic building was maintained and converted in 1997 into a multi-arts facility for young people its success has helped provide creative opportunities for youngsters as well as delivering socially enriching communal events. It is these constant events and public performances that have reinforced and created group connections within Hulme. This hub for young people has tempted beau ideal children off the street and assisted with the reduction in juvenile crime.Connecting People to PlacesAt a macro scale communities suffering from a sense of entrapment and abandonment can be helped through increase permeability and connections to the city. One of the first major actions in Hulme was the re-in educational activity of Stratford Road which provided a vital link to Manchester city centre this allowed the communities to feel integrated with the wider context and thus reduced th eir restriction to resources. Additionally, the completion of the landmark Mancunian Way Footbridge in 2002 symbolically linked Hulme greens with Knott Mill and the City Centre. It was significantly designed for pedestrians and cyclists to be able to cross the busy Mancunian Way, but how can designers encourage pedestrian and cyclist deed in an unsafe environment?Incidentally, various design measures can be employed to increase public realm safety while collectively reduce the impact of the car incidentally the car dominated Hulmes 60s design, ideally the some important public places must be for pedestrians, for no public life can take place between people in automobiles (Jacobs Appleyard 1987, p.119). creation and private space should be clearly defined (Jacobs 1961).A variety of well-lit routes that pedestrians or cyclists can choose should any problems arise.Routes should not be isolated they should be self-policed with sufficient eyes on the street through shops and housing which increase a sense of safety (Jacobs 1961).Street layout should be clear to play down the distance from A to B.The grain of the street should become thin around nodes of activity to influence permeability of the space.At a localised scale increasing social integration amongst a different community is difficult. Designing physical space has its limitations when trying to inform where and what types of social interaction will occur. What can be provided to communities are areas that encourage chance encounters which in turn may create group formations. There are generally two types of group formations, formal and communal. From an urban design perspective the former group type can be encouraged more because they have a prescribed purpose with defined patterns. It is the communal groups which have to evolve themselves, however design can allow social patterns to be easily recognize via unrestricted access to activities within public spaces. It is through repeated activities suc h as markets that friendships can be made over time between existing and new residents. Furthermore, areas designated for specific activities, for instance sports can support group relations. Observing other people and their activities, like watching a local football match, can make others, such as new residents feel a temporal sense of belonging without actually participating in the activity themselves (Carr et al. 1992). This reinforces the argument that public spaces must be accessible to all groups to enable observation as well as verbal interaction.Hulme Park is a prime example of how a public space can have a validating impact on a community. It not only brings people together but improves their quality of life and projects a confident image of the area. The respective brief was to deliver a safe and appealing park to attract a variety of groups. mental barriers rather than physical installations were employed to create a public but secure park. Firstly its width never excee ds 70 metres, this allows users to recognise one other and subconsciously not feel anonymous within the space. Secondly the new surrounding houses provide natural surveillance, also an existing road and perimeter pose increase nearby activity which creates a sense of security.Community Engagement IdentityWhen a neighbourhood neglects their own environment it is important as a designer to try and restore a sense of pride and public ownership of the suffering area through community engagement. Building a sonorousness with residents from the offset can be advantageous during the development process and local input can compulsoryly influence design decisions. User participation in the design process and management of space provides communities with a feeling of control over their own neighbourhood (Carr et al. 1992) this can increase their attachment to place resulting in a revived interest in their surrounding environment. Providing opportunities for personalisation of space can a lso reinforce this goal. The development of Hulme Park involved a series of meetings with residents from the area so its design could appeal to its potential users. Due to diverse requests from a range of age-groups, the designers, Landscape Projects went with a popular theme which arose during the consultation process naiant and surfing. The design theme reflected the communities interest and stamped their identity and involvement on the project. This generated a high level of respect for the space and has resulted in minimal vandalism of the park.Additionally, entire decisions can be made by working with the community when determining suitable functions for a space. It is the function or activity within a space that can become meaningful to individuals, groups and communities. One can create meaningful space based upon understanding the residents lives and patterns of use (Carr et al. 1992). Public space incorporating various functions can be designed by categorising site charac teristics and linking them to desired activity settings suggested by the community. The facilities within Hulme Park were strategically located in order to gain utmost social integration. For instance, the sports area was specifically located next to the existing Proctors Youth Centre so coaches could train and observe the whole team. Local requests for a skate park were integrated into the design too, thus increasing its diversity and user appeal.New developments always ignite some form of opposition, usually from long-term residents as the thought of change unsettles them. Generally they are in search of assurance that their community and the environment in which they live have a future and most importantly that they are part of that future. Territoriality can be a sensitive issue when community groups develop strong feelings about their rights to have a space developed this can create tension between the designer and can instigate neighbourhood disputes as a result of a groups c laim over a space. From an urban design perspective indistinct boundaries are the typical cause of such disputes, therefore delineating spaces that are collectively owned can minimise conflict while strengthening a sense of public ownership.Physical installations can help unify communities and reinstate a sense of identity public art can portray shared social values of a neighbourhood while iconic landmarks can make a positive statement of change, which helps revitalise an area through nullifying previous stigmatisations. This has been achieved in Hulme with Wilkinson Eyres striking Arch Bridge, its key location (a major route from the City Centre to the main thruway network) helps highlight and reinforce the positive transformations occurring within Hulme. It is one of many new landmarks which have attracted more people and businesses to the area, thus building a stronger community which contributes to more eyes on the street and increased local employment results in lower crime l evels. mutation FlexibilityAccording to Calthorpe and Fulton (2001), diversity is one of their aboriginal elements for improving communities. Providing a range of local activities within close proximity enables community identity resulting in a strengthened urban quality. New diverse buildings should be visually interesting if people are to enjoy experiencing their environment, if a citys streets look interesting, the city looks interesting. (Jacobs 1961, p.27). Fig 2 displays how Hulme has become a more kind place to live with its dramatic diversification of housing stock and its replacement of the notorious Hulme Crescent with modern housing. Additionally, Carr et al. (1992) state how nature not only adds diversity to an area but develops bonds between people and places. The best public spaces are the most flexible ones (Madanipour 2004, p.285), hence why spaces deliberately left undefined in Hulme allowed new uses to evolve over time. Through not overdesigning a place it enabl es users to adapt space to their needs. Incidentally, the Hulme horticultural society was officially revived through local adaptable space it also reinforces the fact that nature can bring disparate individuals and groups with various interests together.ConclusionTo summarise, the Hulme case study has demonstrated how quality urban design has the potential to resolve community issues and make a place better. Despite some remaining troubles in Hulme one was keen to focus upon the positive urban design elements which healed many of its community problems. The social benefits realised in the development and revival of Hulme is summarised under the following key urban design elementsPreservation maintaining key buildings like the Zion Art Centre have sustained the historic identity of Hulme which comforts long-term residents, while those regenerated have created nodes of social integration.permeability Accessibility connectivity with the wider environment of Manchester has removed the sense of entrapment and abandonment within Hulme.Communal institutions Public Space the revival of Stratford Road as a shopping last and the success of Hulme park are examples of how Hulmes urban environment has been activated, with increased social activity and group formations.Safety on the streets through logical street design, increased facilities and communal opportunities the greater number of eyes on the street have made the area safer.Neighbourhood involvement through community consultation during developments, residents now feel a sense of ownership, well-being and respect for their environment this has helped reduce vandalism in the area.Landmarks Hulme Arch bridge has helped promote Hulme in a positive light which has resulted in an increase in residents and local businesses resulting in its stronger community spirit and reduced crime rates due to local employment opportunities.Diversity Flexibility the diversity of housing and public space has made the area a more att ractive place to live thus increasing the communities quality of life. Flexible space has provided the opportunity for further positive developments when community interests and desires change.What is apparent is that all the above are interwoven and affect one another in some way therefore they must be purposefully combined to support one another. It is also obvious that environmental and economic factors have an cardinal effect on the success of such design elements. However, one should strive for a complementary economic, environmental and social strategy to maximise community benefits.BibliographyCarr, S. et al., 1992. Public Space. Cambridge Cambridge University Press.Calthorpe, P. Fulton, W., 2001. The Regional City Planning for the end of sprawl. London Island Press.Jacobs, J., 1961. The Death and Life of Great American Cities The Failure of Town Planning. New York Vintage Books.Wilson, W.J., 1997. When Work Disappears The sphere of the New Urban Poor. New York Vintage Books.Jacobs, A. Appleyard, D., 1987. Toward an Urban Design manifesto. Journal of the American Planning Association, 53, pp.112-120.Madanipour, A., 2004. Marginal Public Spaces in European Cities. Journal of Urban Design, 9 (3), pp.267-286.CABE, 2005. Creating Successful Neighbourhoods Lessons and Actions for Housing Market Renewal. London CABE.

The Princess Bride -x :: essays research papers

Journal of William Goldmans The Princess BrideThe princess bride is an incredibly entertaining book. Although it was written mostly as a farce comedy it contains many themes. The developments seen in the dynamic characters are astounding ones. The theme, or motif, which Im going to follow through the story is that of Fezzik and his quest for self confidence and a ripe self image. From the time that the novel starts to the end, Fezzik achieves a good self image. He starts out with a very low self image and, by the end, he finds in himself talents that give him a better image of himself.To begin with, Vizzini never allows Fezzik to provide an sort of input or to think in any way. When Fezzik, inigo and Vizzini setoff kidnap buttercup, Fezzik attempts to offer some good ideas, but Vizzini will take in none of it. I think we should kill her now, the Turk said.The less you think, the happier Ill be, The Scilian answered. (Page 83)And later on the same rascalboy&8230the Turk mumbled . deal are always thinking that Im so stupid because Im big and strong and sometimes drool a little when I get excited.The reason people think youre so stupid, the Scilian said, is because you are so stupid. It has nothing to do with your drooling. Vizzini manages, with his constant verbal attacks on Fezzik to destroy any shred of confidence that Fezzik may have had before. Vizzinis ego is getting in the way of Fezzik. From a very young age Fezzik was taunted by his school mates. At first, naturally, they were scared to death (even then Fezzik looked fierce) but at once they found out he was chicken, well, they werent about to let an opportunity like that get away&8230it would go on like that until Fezzik would burst into tears and liberation away. People never gave Fezzik any sort of chance. He has always been considered a fool out loud. Luckily he had his rhymes to comfort him.When Vizzini dies, although it leaves Fezzik in a take of despair, it is probably the best thing for him. The stopping of Vizzinis verbal attacks allow to build his confidence. I think that the first big confidence building experience for Fezzik is when Inigo begs him for help. From page 224&8230Fly, Fezzik this is Inigo begging you-- make a path&8212please Well, Fezzik had rarely had anyone beg him for anything, least of all Inigo,

Smoking Essay -- Tobacco Cigarettes

SmokingIntroductionSome governments have banned hummer in all public places. Smoking has been proven to be very dangerous to health. Nonetheless 40 % of the population smokes. Actually I am a non smoker, although I used to be a smoker.Most people try out smoking when they are young many youths think smoking is a good grown-up habit. Furthermore many young people begin smoking as an act of rebellion and independence. Young smokers start smoking at their develop of 12 or 13 just to get a taste of , what it is like. Some of them find it disgusting and unhealthy and some of them find it cool.Facts and FiguresTobacco use kills about 420, 000 smokers each year. According to recent studies 53.000 nonsmokers die each year from second-hand smoking. It is not surprising. Despite having plenty of anti-tobacco commercials on Television, and on any single pack of cigarettes there being an important note, chainsmokers cant kick their bad habit. In Hungary a packet of cigarettes costs around 2 Euros. The average smoker buys a packet a day which comes to 730 Euros per year. Could you imagine , what you could do with all that money?Government intervention in the workplace close month while I was reading the newspaper, I came across this article Smoking is not allowed in any public places anymore. I found this ministerial decree, a very good decision, due to there being many smokers in my workplace. There is no assigned smoking area for them. As a consequence I ...