Marketing Plan Phase III

Panera Bread would like to announce a new cyber-cafe available at all locations. This product has been upgraded to assist the growing desire for a full service Internet accessibility location. A plan consisting of four-phases has been developed to market the new product. Currently most locations provide free wireless Internet access to their customer base. Panera has the biggest free wireless network in the USA. During the peak hours of business the customers’ will have a limit amount of time to use the Internet; the time limit is 30-60 minutes (Absolute Astronomy, 2011). However with the upgrade the locations will not have to limit the number of computers or a time limit. Phase One – Upgrade the Internet accessibility at all Panera Bread locations †¢ Development of product – One in three households has never used a computer. 18% of American households do not own a computer or have Internet access (Absolute Astronomy, 2011). SWOTT – An analysis of the cyber-cafe will find the strengths, weaknesses, opportunities, threats, and trends in the market. †¢ Market Research – Panera Bread will distribute a survey to the company’s customer base that will lead to a better understanding of the consumer’s needs for Internet accessibility. Phase Two – Marketing to Consumers †¢ Target Market – Consumers between the age of 18-50 †¢ Consumers – Consumers want to access the Internet for various reasons such as keeping in touch with family, friends, accessing research data, and more. Competitors – Knowing the possible competitors and what they will offer. Phase Three – Expectations of the New Cyber-cafe †¢ Attributes –A larger server and reasonably priced cycle – Expected product life cycle for the cyber-cafe will be approximately 10 years. The reaction expected from competitors will cause a high incentive to duplicate Panera’s new era of cyber-cafes. †¢ Strategy and Price – The basic strategy is to provide a need to the consumers of Pan era Bread. The services cost will be in a price range that everyone can afford. Phase Four – Launching the cyber-cafe * The new improved sever to handle the increase in volume * The product will be put into 10 different locations for testing the new service. With the company following the four-phase plan, the management has high expectations for the cyber-cafe’s success. Panera Bread does not expect the service to start declining for at least six years.

Managing Financial Resources and Decisions

Executive summary This report is to propose an appropriate capital structure for Xpresso Delight Limted’s business expansion with the minimum amount of capital as US$ 30 million. In order to achieve that goal, firstly, it is going to identify the sources of finance available for the business as debt financing which include loans, debentures and bonds; and equity financing, which includes common shares, preference shares and retained profit.It is also to discuss advantages & disadvantages of each source, as well as to assess the implications of these different sources related to risk, legal, financial and dilution of control and bankruptcy. Based on those analyses, it is to select the appropriate sources of finance for the project including retained profit, common and preference shares and loans. What’s more, the costs involved with each source will be assessed and compared in order to form the best alternative of capital structure.There are three options of capital stru cture proposed: †¢ 50% debt financing; and 50% equity including 80% common share and 20% preference shares †¢ 25% debt financing; and 75% equity financing including 80% common shares and 20% preference shares †¢ 10% debt financing; and 90% equity financing including 80% common shares and 20% preference shares Besides, this report is also to mention and explain the importance of financial planning for Xpresso Limited. CONTENTS Page 1.Cover Sheet †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦ 1 2. Executive Summary †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦4 3. Introduction†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ â⠂¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦.. 7 4. Main Body†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦ 8 4. 1 Available various sources of finance†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 8 4. 1. 1. Debt financing†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 8 4. 1. 1. 1. Loans†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦8 4. 1. 1. 2. Debentures†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â ‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦8 4. 1. 1. 3. Bonds†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 9 4. 1. 2. Equity financing†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦. 9 4. 1. 2. 1. Issued share capital†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦9 4. 1. 2. 2.Retained profit & other reserves†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 10 4. 2. Assessment of the implications of sources†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦10 4. 2. 1. Debt financing†¦Ã¢â‚¬ ¦Ã¢â ‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦. 10 4. 2. 1. 1. Debentures†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 11 4. 2. 1. 2. Bonds†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 12 4. 2. 2. Equity financing†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦.. 12 4. 2. 2. 1. Issued shares†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦12 4. 2. 2. 1. 1. Common shares†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã ¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 12 4. 2. 2. 1. 2. Preference shares†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 13 4. 2. 2. 2. Retained profit†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦13 4. 3. Selection of appropriate sources & The assessment and comparison for costs†¦. 4 4. 3. 1. Appropriate sources of finance†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦14 4. 3. 2. Costs of sources†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦14 4. 3. 2. 1. Retained profit†¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚ ¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 14 4. 3. 2. 2. Issued shares†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦14 4. 3. 2. 3. Loans†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 15 4. 3. 3. Options of capital structure†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 15 4. 3. 3. 1. First structure†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 15 4. 3. 3. 2. Second structure†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦. †¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 16 4. 3. 3. 3. Third structure†¦Ã¢â‚¬ ¦Ã¢ € ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦16 4. 4. The financial planning †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦17 4. 4. 1. Definition†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦17 4. 4. 2. Importance for Xpresso Limited†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 17 4. 4. 3. Shortage & surplus of capital: †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 17 5. Conclusion . †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 19 6. Appendix †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 20 7. References†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦21 3. INTRODUCTION: Xpresso Delight Limited is a publicly listed company in Australia Stock Exchange with the headquarter is based in Hanoi, Vietnam. Xpresso Delight Limited is majority owned (51% stake) by Chief Executive Officer (CEO), Mr.Nguyen Dong Khoa. The company has 30 cafes concentrated mainly in big cities in Vietnam like Hanoi, Ho Chi Minh City, Hai Phong, Da Nang, Can Tho and so on. With many advantages such as the growing affluence of coffee culture, the incre asing expatriates population in Vietnam, and even the government’s pro-business policies; Xpresso limited believes that there is an immense market potential in the emerging Vietnam, which encourages it to embark on an ambitious plan of expanding, opening at least 20 cafes each year for the next five years in the various parts of the country.The company issues two kinds of share including ordinary shares (par value US$ 1 per share), which are currently traded at US$ 2. 50 per share; and preference shares, which are currently traded at US$ 52 per share in Australia Stock Exchange. Its corporate tax rate is 25% at present but is expected to go down. With strong earnings growth projected at a constant 15% per annum in the future, Xpresso Delight Limited is expected to pay out US$ 0. 30 per share as ordinary dividend in the next financial year while a constant preference dividend is US$ 5 per share per year.The average flotation cost for the new issue of ordinary shares and prefer ence shares are 17% and 10% of the gross proceeds respectively. For new issue of ordinary shares and preference shares, Xpresso Delight Limited’s issue price will be set at their respective current market price as traded in the Australia Stock Exchange. Xpresso Delight Limited’s before-tax cost of debt is 15%. 4. MAIN BODY: 1. Available various sources of finance: In the case of Xpresso Limited, as a large company with stable profit growth looking for capital to expand, it is only necessary for long-term financing to be taken into account.Therefore, there are two principal sources of finance available to Xpresso Limited including debt and equity financing. 4. 1. 1. Debt financing: In regards to debt financing, the simplest meaning is borrowing money on credit with a promise to repay the amount borrowed, plus interest18. There are many types of debt financing, including borrowing from banks in terms of loans; or borrowing from investors in terms of debentures, bonds 4. 4. 1. 1. 1. Loans: A loan is a financial transaction in which one party – the lender – agrees to give another party – the borrower an amount of money which must be paid back in full16.With a good finance profile and the support of Vietnam government pro-business policies, it is easier for Xpresso Limited to borrow from commercial banks such as Vietcombank, VietinBank and so on. For example, the supportive interest rate of loans in Vietnam at present is fluctuating between 5 and 6 percent per year14, therefore if Xpresso Limited. borrows US$ 10,000, the interest it has to pay back will be between US$ 500 and US$ 600. 4. 1. 1. 2. Debentures: It is a channel for Xpresso to mobilize capital from investors setting out the terms of loans, backed by its reputation but not collateral12.Investors can be individuals, Vietnam and foreign financial institutions such as VinaCapital, BankInvest and so on; and even Vietnam commercial banks are the main investors in organizatio nal debentures. Because of its high standing in the market, investors and other creditors are willing to purchase once Xpresso Limited issues debentures. As in the Vietnam present market , the common interest rate of debentures issued by enterprises is 12. 5 percent per year11, if Xpresso issues debentures of US$ 10 million for 5 years, it has to pay investors the total interest of US$ 6. 5 million. 4. 1. 1. 3. Bonds: Bonds are large debts which are usually paid off over a period of 10 to 35 years1. Simply explaining, in bond financing, Xpresso mobilizes capital from investors instead of banks by selling bonds to them with a promise to pay back with interest, according to specified schedules8. As an example, if Xpresso issues bonds at an interest rate of 6%, the interest over 20 years would be about US$ 0. 73 for each dollar borrowed. 4. 1. 2. Equity financing:In terms of equity financing, equity capital generally is composed of funds that are raised by Xpresso in exchange for an ow nership interest in the company17. Since it is owner’s equity, the company does not have to worry about any liability to repay interest or loans for other parties. There are two major sources of equity financing including issued share capital and retained profit & other reserves12. 4. 1. 2. 1. Issued share capital: Issued share capital is capital that is subscribed by shareholders when they purchase shares Xpresso Limited issues, including common and preference shares4.Common shares are shares issued to the general public in the stock market, while preference shares are shares issued to some special people (for example, banks or specific institutions)2. 4. 1. 2. 2. Retained profit & other reserves: Retained profit is simply profit that has been kept within Xpresso Limited rather than paid out to shareholders as dividends 2. 2. Assessment of the implications of sources of finance to Xpresso Delight Limited related to risk, legal, financial and dilution of control and bankruptc y: 4. 2. 1. Debt financing:As being categorized in debt financing, those various types including loans, debentures and bonds have some implications to Xpresso in similarity, which are going to be discussed below. There are many advantages of Xpresso Limited for using debt financing. There is no dilution of control since the creditors have no authority in running the company but just involve in the money they invest; and they usually do not participate in the superior earnings of the company either as the cost of debts is limited 13. The most important advantage is tax relief on interest as it is considered one kind of expenses3.For example, if Xpresso Limited borrows US$ 10,000 at the interest rate of 5%, it will have to pay the interest of US$ 500 but will be reduced US$ 500 in the tax-incurred income. What’s more, in time of inflation, debts may be paid back with â€Å"cheaper pesos†13 since the money becomes worth less. To the existing shareholders, one advantage is when Xpresso Limited unfortunately goes broke, they may lose their investment but other personal possessions are safe 2. However, using debt financing also has disadvantages. Obviously, debts add risk to the company12.There is a risk of not having enough money to pay by the maturity date or if the earnings of Xpresso Limited fluctuate 12; either of which easily makes the company become bankruptcy. To add more, the legal of debt financing in Vietnam is relatively complicated 2, and certain managerial prerogatives are usually given up in the bond’s indenture contract (for example, specific ratios must be kept above a certain level during the term of the loan)13. Besides, debentures and bonds also have their own characteristics. 4. 2. 1. 1. Debentures:One advantage of using debenture financing is that Xpresso Limited does not have to give collateral9. However, it also has disadvantages as it must compete with government loan stocks (gilts), what are the dominant type of debentu res in Vietnam market, so the company must generally offer a higher rate of interest than the one on gilts to attract investors4. The legal issue of debentures that Xpresso Limited has to concern is that if a bond defaults, investors are entitled to the liquidation proceeds of property bought with the money they invest (by purchasing debentures)5. . 2. 1. 2. Bonds: Bonds have fixed interest and are issued for long-term1. One advantage of using bond is that substantial flexibility in the financial structure is enhanced by debt through the inclusion of call provisions in the bond indenture13. In case of financial distress, bondholders have greater claims of the issuer’s income than shareholders6. 4. 2. 2. Equity financing: 4. 2. 2. 1. Issued shares: The legal aspect involved is that shareholders are also owners of the company4.Therefore, the business ownership is diluted and it is possible to lose the control of the business for investors. However, there is also an advantage th at there is large potential membership to provide capital and to share risks of loss, bankruptcy and so on. There is a part of profit of the company distributed to shareholders as dividends. One significant advantage of using issued share capital is that Xpresso may withhold the dividend if profits are insufficient. One disadvantage is that cash dividends are not tax deductible. 13) Besides, each type of shares also has its own characteristics. 4. 2. 2. 1. 1. Common shares: The advantages of using common shares are that common dividend is based on profits when so that Xpresso Limited is free from worrying about not having enough money to pay; there is no fixed maturity date for repayment of the capital; and the sale of common shares is frequently more attractive to investors than debts as its value grows with the success of the firm11. However, there are disadvantages as well. Shareholders ave right to vote, therefore the shareholders’ control and share in earnings are usuall y diluted13. If Xpresso decides to issue common shares, the stake of CEO (51% at present) will be reduced as the number of shares increases. In terms of finance, issuance of common shares requires higher underwriting costs; and the average cost of capital may increase above the optimal level when too much equity is issued13. 4. 2. 2. 1. 2. Preference shares: Legally, like common share, preference shares represent a part of ownership or equity of Xpresso Limited4.What’s more, in case of financial distress, claims of preference shareholders must be satisfied before common shareholders receive anything13. There is no default risk since non-payment of dividends does not necessarily mean bankruptcy. Preference dividend is fixed so that the company can plan to pay. Preference shareholders have no voting rights except in case of financial distress, which means there is no dilution of control. Call features and provision of sinking may be included so Xpresso may replace the issue if interest rates decline.There is one disadvantage that preference shares involve cumulative feature, which means in case Xpresso Limited does not have money to pay dividends in a particular year, the dividend keeps getting added to the next years’ dividend until the it is able to pay. (13) 4. 2. 2. 2. Retained profit: There are advantages to using retained profit as a form of finance due to the absence of brokerage costs (for example, merchant banks’ fees), its simplicity and flexibility, and all gains from investment will still ultimately belong to existing shareholders13.Besides, there are disadvantages as shareholders’ expectation of dividends may present a problem or insufficient earnings may be available4. 4. 3. Selection of appropriate sources of finance for a business project & assessment and comparison for various cost involved for each sources: 4. 3. 1. Appropriate sources of finance: As discussed above, it is proposed that Xpresso Delight Limited should use equity financing in forms of retained profit, issued share capital and debt financing in forms of loans in the capital structure.The main source that should be included is retained earning since it is the solidest source and has the least risk to the firm3. Issued shares and loans are the next choices as they bring many opportunities and a relatively reasonable number of risks as well as liabilities. 4. 3. 2. Costs of sources: 4. 3. 2. 1. Retained profit: Costs of retained earnings include fixed expenses such as wages, rent, materials, electricity and so on; tax cost; dividends (dividends are a cost of retained earnings as well as a cost of share capital); certain costs if invested in the short term as not needed immediately; and also opportunity costs4. . 3. 2. 2. Issued shares: Costs of the issued share capital include flotation costs, dividends (cash dividend and scrip dividends- dividends in the form of new shares); cost of providing shareholders or owners with information about the performance of the business such as the cost of glossy financial reports, Annual General Meetings, audit fees and the administrative costs of company with legal and Stock Exchange requirements for disclosure of information to shareholders; and also certain costs associated with investing them if not needed immediately4. 4. 3. 2. 3. Loans:Loans have interest as the main cost. The rate of interest may either be fixed or variable but in the case of Xpresso Limited it is fixed. There are also other costs including an initial arrangement fee to cover lender’s administrative costs on setting up the loan (checking references, setting up data on a computer system and so on); factors charge commission for advancing funds; non-financial costs involved in the relationship between the company and creditors (for example, Xpresso will be required to provide the creditor with regular information about the performance of the business)4.That kind of non-financial cost may create the uncomfortable feeling of being watched for the owner. Opportunity cost is also included in this case as well. For instance, instead of paying interest of US$ 10,000 a year the business could do something else with that US$ 10,000 that might help generate income. 4. 3. 3. Options of capital structure: There are three alternative capital structures that could be taken into account. Based on the comparison between their advantages and disadvantages, the most appropriate structure would be chosen. . 3. 3. 1. First structure: For the first structure, it is to use 50% debt financing; and 50% equity including 80% common share and 20% preference shares. That means US$ 15 million of debts, and US$ 15 million of equity including US$ 12 million of common shares and US$ 3 million of preference shares. The costs of sources are: Rf = US$ 0. 167 million Rc = US$ 1. 84 million Rd = US$ 1. 69 million The total cost is: 0. 167 + 1. 84 + 1. 69 = 3. 697 (US$ million) 4. 3. 3. 2. Second structure:The s econd structure is to use 25% debt financing; and 75% equity financing including 80% common shares and 20% preference shares. That means US$ 7. 5 million of debts, US$ 22. 5 million of equity including US$ 18 million of common shares and US$ 4. 5 million of preference shares. The costs of sources are: Rf = US$ 0. 25 million Rc = US$ 2. 81 million Rd = US$ 0. 84 million The total cost is: 0. 25 + 2. 81 + 0. 84 = 3. 9 (US$ million) 4. 3. 3. 3. Third structure: The third structure includes 10% debt financing; and 90% equity financing including 80% common shares and 20% preference shares.That means US$ 3 million of debts, and US$ 27 million of equity including US$ 21. 6 million of common shares and US$ 5. 4 million of preference shares. The costs of sources are: Rf = US$ 0. 3 million Rc= US$ 3. 32 million Rd = US$ 0. 34 million The total cost is: 0. 3 + 3. 32 + 0. 34 = 3. 96 (US$ million) As comparing the costs and the advantages & disadvantages of the three structures, it is to be said that the second structure is the best capital structure to apply for Xpresso Limited.Because although it does not has the lowest cost, the proportions of sources of finance included are the most appropriate option as the percentage of debts used (25%) is not too high for adding risks to the company but also ensures for the financial leverage (the tax relief) to be used. In addition, the cost of finance in this structure is still relatively low. 4. 4. The financial planning: 4. 4. 1. Definition: In general, financial planning is the process of developing strategies to help you manage your financial affairs so you can build wealth, enjoy life and achieve financial security5. . 4. 2. Importance for Xpresso Limited: Financial planning involves achieving a balance between the requirements to minimize the risk of not having cash to pay creditors and the requirements to maximize the earnings made by using assets4. It plays a very important role in helping Xpresso co-ordinate and organize the internal system, set up detailed plans for using resources, as well as for paying debts and liabilities, develop strategies, and finally prepare for any potential incidents in the future7. For Xpresso, every transaction has to be well-planned to run the business efficiently. . 4. 3. Shortage & surplus of capital: Capital surplus- the amounts of directly contributed equity capital in excess of the par value13 – has a large impact on Xpresso Limited as it can be used to distribute as bonus dividends to shareholders, to reinvest as owner’s equity and it also helps to reduce the cost of capital mobilizing9. It helps gain more prestige for Xpresso but also gives more pressure on the management as they have a duty to use it effectively. Capital is one factor of production, therefore its shortage makes difficulties for Xpresso to operate and develop efficiently4.Even it can lead to bankruptcy if capital shortage is too large. 5. CONCLUSION: It can be said that each and ev ery source of finance has both advantages and disadvantages. The aim is to make use of the advantages and also to avoid the disadvantages of all sources. The best capital structure is to combine the appropriate sources to make the best use for the company. To conclude, the capital structure proposed is to use 25% debt financing and 75% equity financing including 80% common shares and 20% preference shares in estimated US$ 30 million of capital.The cost of finance is US$ 3. 9 million. The structure has a relatively cost of finance and also ensures to make use of all advantages as well as minimizes all disadvantages of sources of finance used for expansion. As preparing a detailed and well-organized financial planning, there is a high rate of success for the expansion and other further developments of Xpresso Delight Limited Company. Appendix 1. Formula of cost debts: + Before-tax cost: Rdt = debts x 15% + After-tax cost: Rd = Rdt x (1 – t) Rd : After-tax cost Rdt : Before-tax cost t : Corporate tax rate (t = 25%) . Formula of cost of issuing shares: 1. Cost of issuing common shares: Rc = Dc / Pc (1 – ec) + g Dc : dividend per share (Dc= US$ 0. 3) Pc : value per share (Pc= US$ 1) ec : flotation cost for ordinary share (ec= 17%) g: rate of earnings growth (g= 15%) 2. Cost of issuing preference shares: Rf = Df / Pf (1 – ef) Df : dividend per share (Df = US$ 5) Pf : value per share (Pf = US$ 1) ef : flotation cost for preference (ef= 10%) Reference: 1. City & County of San Francisco (2002) Bond Financing Basics. San Francisco: Controller’s office 2.Communist party of Vietnam (2005) Procedure of borrowing from Vietnam bank for agriculture and rural development [online]. Updated 20 June 2005 [accessed 29 November 2009]. Available from: http://www. cpv. org. vn/cpv/Modules/News/NewsDetail. aspx? co_id=30592&cn_id=223635 3. Edexcel HNC&HND business (2004) Business environment, London: BPP professional Education 4. Edexcel HNC&HND business (2 004) Managing financial resources and decisions, London: BPP professional Education 5. Financial News (1996) [online]. eFinancialNews Ltd [cited 26 October 2009] .Available from Internet: http://www. efinancialnews. com/&sc=TWTAM000GS 6. Financial planning defined (2005) [online] Financial Planning Association [cited 25 October 2009]. Available from Internet: http://www. fpa. asn. au/FPA_Content. aspx? Doc_id=1056 7. Hong, P. (2007) Capital surplus- to distribute or not?. Saga [online]. Accession No. 362/GP-BC, 10 October, [cited 1 December 2009]. Available from: http://www. saga. vn/Luatkinhdoanh/Luattrongnuoc/6794. saga 8. Hong, S. (2009) Organizational debentures attractive to foreign Managing Financial Resources and Decisions Executive summary This report is to propose an appropriate capital structure for Xpresso Delight Limted’s business expansion with the minimum amount of capital as US$ 30 million. In order to achieve that goal, firstly, it is going to identify the sources of finance available for the business as debt financing which include loans, debentures and bonds; and equity financing, which includes common shares, preference shares and retained profit.It is also to discuss advantages & disadvantages of each source, as well as to assess the implications of these different sources related to risk, legal, financial and dilution of control and bankruptcy. Based on those analyses, it is to select the appropriate sources of finance for the project including retained profit, common and preference shares and loans. What’s more, the costs involved with each source will be assessed and compared in order to form the best alternative of capital structure.There are three options of capital stru cture proposed: †¢ 50% debt financing; and 50% equity including 80% common share and 20% preference shares †¢ 25% debt financing; and 75% equity financing including 80% common shares and 20% preference shares †¢ 10% debt financing; and 90% equity financing including 80% common shares and 20% preference shares Besides, this report is also to mention and explain the importance of financial planning for Xpresso Limited. CONTENTS Page 1.Cover Sheet †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦ 1 2. Executive Summary †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦4 3. Introduction†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ â⠂¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦.. 7 4. Main Body†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦ 8 4. 1 Available various sources of finance†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 8 4. 1. 1. Debt financing†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 8 4. 1. 1. 1. Loans†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦8 4. 1. 1. 2. Debentures†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â ‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦8 4. 1. 1. 3. Bonds†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 9 4. 1. 2. Equity financing†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦. 9 4. 1. 2. 1. Issued share capital†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦9 4. 1. 2. 2.Retained profit & other reserves†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 10 4. 2. Assessment of the implications of sources†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦10 4. 2. 1. Debt financing†¦Ã¢â‚¬ ¦Ã¢â ‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦. 10 4. 2. 1. 1. Debentures†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 11 4. 2. 1. 2. Bonds†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 12 4. 2. 2. Equity financing†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦.. 12 4. 2. 2. 1. Issued shares†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦12 4. 2. 2. 1. 1. Common shares†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã ¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 12 4. 2. 2. 1. 2. Preference shares†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 13 4. 2. 2. 2. Retained profit†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦13 4. 3. Selection of appropriate sources & The assessment and comparison for costs†¦. 4 4. 3. 1. Appropriate sources of finance†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦14 4. 3. 2. Costs of sources†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦14 4. 3. 2. 1. Retained profit†¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚ ¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 14 4. 3. 2. 2. Issued shares†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦14 4. 3. 2. 3. Loans†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 15 4. 3. 3. Options of capital structure†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 15 4. 3. 3. 1. First structure†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 15 4. 3. 3. 2. Second structure†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦. †¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 16 4. 3. 3. 3. Third structure†¦Ã¢â‚¬ ¦Ã¢ € ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦16 4. 4. The financial planning †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦17 4. 4. 1. Definition†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦17 4. 4. 2. Importance for Xpresso Limited†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 17 4. 4. 3. Shortage & surplus of capital: †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 17 5. Conclusion . †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 19 6. Appendix †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 20 7. References†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦21 3. INTRODUCTION: Xpresso Delight Limited is a publicly listed company in Australia Stock Exchange with the headquarter is based in Hanoi, Vietnam. Xpresso Delight Limited is majority owned (51% stake) by Chief Executive Officer (CEO), Mr.Nguyen Dong Khoa. The company has 30 cafes concentrated mainly in big cities in Vietnam like Hanoi, Ho Chi Minh City, Hai Phong, Da Nang, Can Tho and so on. With many advantages such as the growing affluence of coffee culture, the incre asing expatriates population in Vietnam, and even the government’s pro-business policies; Xpresso limited believes that there is an immense market potential in the emerging Vietnam, which encourages it to embark on an ambitious plan of expanding, opening at least 20 cafes each year for the next five years in the various parts of the country.The company issues two kinds of share including ordinary shares (par value US$ 1 per share), which are currently traded at US$ 2. 50 per share; and preference shares, which are currently traded at US$ 52 per share in Australia Stock Exchange. Its corporate tax rate is 25% at present but is expected to go down. With strong earnings growth projected at a constant 15% per annum in the future, Xpresso Delight Limited is expected to pay out US$ 0. 30 per share as ordinary dividend in the next financial year while a constant preference dividend is US$ 5 per share per year.The average flotation cost for the new issue of ordinary shares and prefer ence shares are 17% and 10% of the gross proceeds respectively. For new issue of ordinary shares and preference shares, Xpresso Delight Limited’s issue price will be set at their respective current market price as traded in the Australia Stock Exchange. Xpresso Delight Limited’s before-tax cost of debt is 15%. 4. MAIN BODY: 1. Available various sources of finance: In the case of Xpresso Limited, as a large company with stable profit growth looking for capital to expand, it is only necessary for long-term financing to be taken into account.Therefore, there are two principal sources of finance available to Xpresso Limited including debt and equity financing. 4. 1. 1. Debt financing: In regards to debt financing, the simplest meaning is borrowing money on credit with a promise to repay the amount borrowed, plus interest18. There are many types of debt financing, including borrowing from banks in terms of loans; or borrowing from investors in terms of debentures, bonds 4. 4. 1. 1. 1. Loans: A loan is a financial transaction in which one party – the lender – agrees to give another party – the borrower an amount of money which must be paid back in full16.With a good finance profile and the support of Vietnam government pro-business policies, it is easier for Xpresso Limited to borrow from commercial banks such as Vietcombank, VietinBank and so on. For example, the supportive interest rate of loans in Vietnam at present is fluctuating between 5 and 6 percent per year14, therefore if Xpresso Limited. borrows US$ 10,000, the interest it has to pay back will be between US$ 500 and US$ 600. 4. 1. 1. 2. Debentures: It is a channel for Xpresso to mobilize capital from investors setting out the terms of loans, backed by its reputation but not collateral12.Investors can be individuals, Vietnam and foreign financial institutions such as VinaCapital, BankInvest and so on; and even Vietnam commercial banks are the main investors in organizatio nal debentures. Because of its high standing in the market, investors and other creditors are willing to purchase once Xpresso Limited issues debentures. As in the Vietnam present market , the common interest rate of debentures issued by enterprises is 12. 5 percent per year11, if Xpresso issues debentures of US$ 10 million for 5 years, it has to pay investors the total interest of US$ 6. 5 million. 4. 1. 1. 3. Bonds: Bonds are large debts which are usually paid off over a period of 10 to 35 years1. Simply explaining, in bond financing, Xpresso mobilizes capital from investors instead of banks by selling bonds to them with a promise to pay back with interest, according to specified schedules8. As an example, if Xpresso issues bonds at an interest rate of 6%, the interest over 20 years would be about US$ 0. 73 for each dollar borrowed. 4. 1. 2. Equity financing:In terms of equity financing, equity capital generally is composed of funds that are raised by Xpresso in exchange for an ow nership interest in the company17. Since it is owner’s equity, the company does not have to worry about any liability to repay interest or loans for other parties. There are two major sources of equity financing including issued share capital and retained profit & other reserves12. 4. 1. 2. 1. Issued share capital: Issued share capital is capital that is subscribed by shareholders when they purchase shares Xpresso Limited issues, including common and preference shares4.Common shares are shares issued to the general public in the stock market, while preference shares are shares issued to some special people (for example, banks or specific institutions)2. 4. 1. 2. 2. Retained profit & other reserves: Retained profit is simply profit that has been kept within Xpresso Limited rather than paid out to shareholders as dividends 2. 2. Assessment of the implications of sources of finance to Xpresso Delight Limited related to risk, legal, financial and dilution of control and bankruptc y: 4. 2. 1. Debt financing:As being categorized in debt financing, those various types including loans, debentures and bonds have some implications to Xpresso in similarity, which are going to be discussed below. There are many advantages of Xpresso Limited for using debt financing. There is no dilution of control since the creditors have no authority in running the company but just involve in the money they invest; and they usually do not participate in the superior earnings of the company either as the cost of debts is limited 13. The most important advantage is tax relief on interest as it is considered one kind of expenses3.For example, if Xpresso Limited borrows US$ 10,000 at the interest rate of 5%, it will have to pay the interest of US$ 500 but will be reduced US$ 500 in the tax-incurred income. What’s more, in time of inflation, debts may be paid back with â€Å"cheaper pesos†13 since the money becomes worth less. To the existing shareholders, one advantage is when Xpresso Limited unfortunately goes broke, they may lose their investment but other personal possessions are safe 2. However, using debt financing also has disadvantages. Obviously, debts add risk to the company12.There is a risk of not having enough money to pay by the maturity date or if the earnings of Xpresso Limited fluctuate 12; either of which easily makes the company become bankruptcy. To add more, the legal of debt financing in Vietnam is relatively complicated 2, and certain managerial prerogatives are usually given up in the bond’s indenture contract (for example, specific ratios must be kept above a certain level during the term of the loan)13. Besides, debentures and bonds also have their own characteristics. 4. 2. 1. 1. Debentures:One advantage of using debenture financing is that Xpresso Limited does not have to give collateral9. However, it also has disadvantages as it must compete with government loan stocks (gilts), what are the dominant type of debentu res in Vietnam market, so the company must generally offer a higher rate of interest than the one on gilts to attract investors4. The legal issue of debentures that Xpresso Limited has to concern is that if a bond defaults, investors are entitled to the liquidation proceeds of property bought with the money they invest (by purchasing debentures)5. . 2. 1. 2. Bonds: Bonds have fixed interest and are issued for long-term1. One advantage of using bond is that substantial flexibility in the financial structure is enhanced by debt through the inclusion of call provisions in the bond indenture13. In case of financial distress, bondholders have greater claims of the issuer’s income than shareholders6. 4. 2. 2. Equity financing: 4. 2. 2. 1. Issued shares: The legal aspect involved is that shareholders are also owners of the company4.Therefore, the business ownership is diluted and it is possible to lose the control of the business for investors. However, there is also an advantage th at there is large potential membership to provide capital and to share risks of loss, bankruptcy and so on. There is a part of profit of the company distributed to shareholders as dividends. One significant advantage of using issued share capital is that Xpresso may withhold the dividend if profits are insufficient. One disadvantage is that cash dividends are not tax deductible. 13) Besides, each type of shares also has its own characteristics. 4. 2. 2. 1. 1. Common shares: The advantages of using common shares are that common dividend is based on profits when so that Xpresso Limited is free from worrying about not having enough money to pay; there is no fixed maturity date for repayment of the capital; and the sale of common shares is frequently more attractive to investors than debts as its value grows with the success of the firm11. However, there are disadvantages as well. Shareholders ave right to vote, therefore the shareholders’ control and share in earnings are usuall y diluted13. If Xpresso decides to issue common shares, the stake of CEO (51% at present) will be reduced as the number of shares increases. In terms of finance, issuance of common shares requires higher underwriting costs; and the average cost of capital may increase above the optimal level when too much equity is issued13. 4. 2. 2. 1. 2. Preference shares: Legally, like common share, preference shares represent a part of ownership or equity of Xpresso Limited4.What’s more, in case of financial distress, claims of preference shareholders must be satisfied before common shareholders receive anything13. There is no default risk since non-payment of dividends does not necessarily mean bankruptcy. Preference dividend is fixed so that the company can plan to pay. Preference shareholders have no voting rights except in case of financial distress, which means there is no dilution of control. Call features and provision of sinking may be included so Xpresso may replace the issue if interest rates decline.There is one disadvantage that preference shares involve cumulative feature, which means in case Xpresso Limited does not have money to pay dividends in a particular year, the dividend keeps getting added to the next years’ dividend until the it is able to pay. (13) 4. 2. 2. 2. Retained profit: There are advantages to using retained profit as a form of finance due to the absence of brokerage costs (for example, merchant banks’ fees), its simplicity and flexibility, and all gains from investment will still ultimately belong to existing shareholders13.Besides, there are disadvantages as shareholders’ expectation of dividends may present a problem or insufficient earnings may be available4. 4. 3. Selection of appropriate sources of finance for a business project & assessment and comparison for various cost involved for each sources: 4. 3. 1. Appropriate sources of finance: As discussed above, it is proposed that Xpresso Delight Limited should use equity financing in forms of retained profit, issued share capital and debt financing in forms of loans in the capital structure.The main source that should be included is retained earning since it is the solidest source and has the least risk to the firm3. Issued shares and loans are the next choices as they bring many opportunities and a relatively reasonable number of risks as well as liabilities. 4. 3. 2. Costs of sources: 4. 3. 2. 1. Retained profit: Costs of retained earnings include fixed expenses such as wages, rent, materials, electricity and so on; tax cost; dividends (dividends are a cost of retained earnings as well as a cost of share capital); certain costs if invested in the short term as not needed immediately; and also opportunity costs4. . 3. 2. 2. Issued shares: Costs of the issued share capital include flotation costs, dividends (cash dividend and scrip dividends- dividends in the form of new shares); cost of providing shareholders or owners with information about the performance of the business such as the cost of glossy financial reports, Annual General Meetings, audit fees and the administrative costs of company with legal and Stock Exchange requirements for disclosure of information to shareholders; and also certain costs associated with investing them if not needed immediately4. 4. 3. 2. 3. Loans:Loans have interest as the main cost. The rate of interest may either be fixed or variable but in the case of Xpresso Limited it is fixed. There are also other costs including an initial arrangement fee to cover lender’s administrative costs on setting up the loan (checking references, setting up data on a computer system and so on); factors charge commission for advancing funds; non-financial costs involved in the relationship between the company and creditors (for example, Xpresso will be required to provide the creditor with regular information about the performance of the business)4.That kind of non-financial cost may create the uncomfortable feeling of being watched for the owner. Opportunity cost is also included in this case as well. For instance, instead of paying interest of US$ 10,000 a year the business could do something else with that US$ 10,000 that might help generate income. 4. 3. 3. Options of capital structure: There are three alternative capital structures that could be taken into account. Based on the comparison between their advantages and disadvantages, the most appropriate structure would be chosen. . 3. 3. 1. First structure: For the first structure, it is to use 50% debt financing; and 50% equity including 80% common share and 20% preference shares. That means US$ 15 million of debts, and US$ 15 million of equity including US$ 12 million of common shares and US$ 3 million of preference shares. The costs of sources are: Rf = US$ 0. 167 million Rc = US$ 1. 84 million Rd = US$ 1. 69 million The total cost is: 0. 167 + 1. 84 + 1. 69 = 3. 697 (US$ million) 4. 3. 3. 2. Second structure:The s econd structure is to use 25% debt financing; and 75% equity financing including 80% common shares and 20% preference shares. That means US$ 7. 5 million of debts, US$ 22. 5 million of equity including US$ 18 million of common shares and US$ 4. 5 million of preference shares. The costs of sources are: Rf = US$ 0. 25 million Rc = US$ 2. 81 million Rd = US$ 0. 84 million The total cost is: 0. 25 + 2. 81 + 0. 84 = 3. 9 (US$ million) 4. 3. 3. 3. Third structure: The third structure includes 10% debt financing; and 90% equity financing including 80% common shares and 20% preference shares.That means US$ 3 million of debts, and US$ 27 million of equity including US$ 21. 6 million of common shares and US$ 5. 4 million of preference shares. The costs of sources are: Rf = US$ 0. 3 million Rc= US$ 3. 32 million Rd = US$ 0. 34 million The total cost is: 0. 3 + 3. 32 + 0. 34 = 3. 96 (US$ million) As comparing the costs and the advantages & disadvantages of the three structures, it is to be said that the second structure is the best capital structure to apply for Xpresso Limited.Because although it does not has the lowest cost, the proportions of sources of finance included are the most appropriate option as the percentage of debts used (25%) is not too high for adding risks to the company but also ensures for the financial leverage (the tax relief) to be used. In addition, the cost of finance in this structure is still relatively low. 4. 4. The financial planning: 4. 4. 1. Definition: In general, financial planning is the process of developing strategies to help you manage your financial affairs so you can build wealth, enjoy life and achieve financial security5. . 4. 2. Importance for Xpresso Limited: Financial planning involves achieving a balance between the requirements to minimize the risk of not having cash to pay creditors and the requirements to maximize the earnings made by using assets4. It plays a very important role in helping Xpresso co-ordinate and organize the internal system, set up detailed plans for using resources, as well as for paying debts and liabilities, develop strategies, and finally prepare for any potential incidents in the future7. For Xpresso, every transaction has to be well-planned to run the business efficiently. . 4. 3. Shortage & surplus of capital: Capital surplus- the amounts of directly contributed equity capital in excess of the par value13 – has a large impact on Xpresso Limited as it can be used to distribute as bonus dividends to shareholders, to reinvest as owner’s equity and it also helps to reduce the cost of capital mobilizing9. It helps gain more prestige for Xpresso but also gives more pressure on the management as they have a duty to use it effectively. Capital is one factor of production, therefore its shortage makes difficulties for Xpresso to operate and develop efficiently4.Even it can lead to bankruptcy if capital shortage is too large. 5. CONCLUSION: It can be said that each and ev ery source of finance has both advantages and disadvantages. The aim is to make use of the advantages and also to avoid the disadvantages of all sources. The best capital structure is to combine the appropriate sources to make the best use for the company. To conclude, the capital structure proposed is to use 25% debt financing and 75% equity financing including 80% common shares and 20% preference shares in estimated US$ 30 million of capital.The cost of finance is US$ 3. 9 million. The structure has a relatively cost of finance and also ensures to make use of all advantages as well as minimizes all disadvantages of sources of finance used for expansion. As preparing a detailed and well-organized financial planning, there is a high rate of success for the expansion and other further developments of Xpresso Delight Limited Company. Appendix 1. Formula of cost debts: + Before-tax cost: Rdt = debts x 15% + After-tax cost: Rd = Rdt x (1 – t) Rd : After-tax cost Rdt : Before-tax cost t : Corporate tax rate (t = 25%) . Formula of cost of issuing shares: 1. Cost of issuing common shares: Rc = Dc / Pc (1 – ec) + g Dc : dividend per share (Dc= US$ 0. 3) Pc : value per share (Pc= US$ 1) ec : flotation cost for ordinary share (ec= 17%) g: rate of earnings growth (g= 15%) 2. Cost of issuing preference shares: Rf = Df / Pf (1 – ef) Df : dividend per share (Df = US$ 5) Pf : value per share (Pf = US$ 1) ef : flotation cost for preference (ef= 10%) Reference: 1. City & County of San Francisco (2002) Bond Financing Basics. San Francisco: Controller’s office 2.Communist party of Vietnam (2005) Procedure of borrowing from Vietnam bank for agriculture and rural development [online]. Updated 20 June 2005 [accessed 29 November 2009]. Available from: http://www. cpv. org. vn/cpv/Modules/News/NewsDetail. aspx? co_id=30592&cn_id=223635 3. Edexcel HNC&HND business (2004) Business environment, London: BPP professional Education 4. Edexcel HNC&HND business (2 004) Managing financial resources and decisions, London: BPP professional Education 5. Financial News (1996) [online]. eFinancialNews Ltd [cited 26 October 2009] .Available from Internet: http://www. efinancialnews. com/&sc=TWTAM000GS 6. Financial planning defined (2005) [online] Financial Planning Association [cited 25 October 2009]. Available from Internet: http://www. fpa. asn. au/FPA_Content. aspx? Doc_id=1056 7. Hong, P. (2007) Capital surplus- to distribute or not?. Saga [online]. Accession No. 362/GP-BC, 10 October, [cited 1 December 2009]. Available from: http://www. saga. vn/Luatkinhdoanh/Luattrongnuoc/6794. saga 8. Hong, S. (2009) Organizational debentures attractive to foreign

Popper

â€Å"The greatest disease in the West today is not Tuberculosis or leprosy; it is being unwanted, unloved, and uncared for. We can cure physical diseases with medicine, but the only cure for loneliness, despair, and hopelessness is love. † This quote, spoken by Mother Teresa, describes why I aspire to be a nurse. The technology and medicine we have in the world today is extremely advanced. However, this advanced technology and medicine would be worthless without the compassion and quality care given by trained nurses.I remember when my mom got the phone call that my grandfather had stopped breathing and that he only had a few hours to live. My grandparents live in Florida, however; they were driving to New York for a wedding. After they drove through the Lincoln Tunnel, my grandparents' next direction was to make their first right. Instead, my grandfather proceeded to make the first left. My grandmother said, † No, you turned the wrong way! † My grandfather repli ed, † But the hospital is this way. † My mom told me that his heart had stopped. My grandfather has a long history of earth problems and has had many surgeries.He resuscitated by the Meet's and was put into the Intensive Care Unit. My father drove my mother and aunt to New York so they could have the opportunity to see my grandfather still alive since he was not expected to live more than a few hours. With modern medicine and lots of prayer, he was able to make a full recovery. This incident made me want to learn more about how the body and the heart works. Ever since then, I've wanted to be a cardiovascular nurse. To me, being a nurse is far more than a Job or career. It is a continuous learning recess that I look forward to every day.I love the thought that I can wake up every day and help people. In order to be a great nurse, you must have many qualities that enable you to be a leader, an advocate, and a friend. It is a necessity to give quality care. Nurses have to h ave compassion. Compassion is not a single trait. Compassion means you care, you are loyal, devoted, honest, and hardworking. It means you are willing to do more for others than for yourself. Now I am in my senior year of high school and I am still working towards my dream of becoming a cardiovascular nurse.I am in the nursing program at Hartford Tech and I am currently participating in clinical at Lories Nursing Home. After I complete 40 hours of hands-on experience at Lories and pass a state skills and written test, I will become a Certified Nursing Assistant and a Geriatric Nursing Assistant. I plan on attending Hartford Community College in the fall of 2014. I hope to get into the nursing program there and receive my associates degree. After receiving my associates degree, I plan to continue on to a university and earn my masters degree.

EMPLOYABILITY AND PERSONAL DEVELOPMENT Article Example | Topics and Well Written Essays - 2000 words

EMPLOYABILITY AND PERSONAL DEVELOPMENT - Article Example The following discussion reveals all the important issues highlighted on after intense evaluation of the factors that coincide with learning and employability. The process of elevating employability and personal development The phenomenon is crucial in guaranteeing the society of educated professionals, and career oriented individuals. The subject seeks to emulate the ideal personal skills sort in the elite after completion of academic courses. Employability also seeks to ensure to learners that the working environment has numerous obstacles, which can only be derailed by the expression of the ideal knowledge prior to seeking jobs in the specific industries reflecting personal careers (Gallagher, 2013, p. 259). During personal development, the workshop highlighted that students in different learning institutions needed to involve themselves in self-awareness evaluation processes. Such processes would enable them to accrue an understanding of their individual capabilities, and ideolog ies of the perceptions that may be shown by their potential employers on the event of seeking employment opportunities. ... Further, the study describes that students should rely enviably on the present resources in order to be capable of realizing the future outcomes. Personal esteem and identity match conclusively in this case since students are able to adapt the variables prior to emulation of their personal abilities (Gonon, 2008, p.89). Such practices are salient in enabling the students to realize their potentials in emulating a match in accordance to the needs and wants of the employment fraternity. The seminar highlighted on students’ modelling and rehearsal programs as subjects to the underpinning theoretical frameworks. Mainly, the seminar highlighted on John Locke’s 1968 arguments that employability procedures coincided abundantly individuals’ own goal setting, and future forecasts on their lifelong wishes. Arguments are that the process of employability and accountability further facilitate the improvement of the ideal personal abilities and talents. It is sound for studen ts to understand that their potential is ideal to the acquisition of reassurances that they will be able to earn employment opportunities after completion of their studies. Evidence from the London employability and personal development seminar highlighted that students would be working towards achievement of their future dreams only if they would be building upon their future dreams. Further, these efforts would saliently lead to the acquisition of their dream lives thus they would live quality lives. The theoretical frameworks were important in assuring learners of success since the knowledge accrued during the process would be exhorted in the future learning process. The aspect

Informational Interview Term Paper Example | Topics and Well Written Essays - 1000 words

Informational Interview - Term Paper Example Trust and accountability are good virtues that can help any businessperson establish a good relationship with the customers, which has a positive impact on any kind of business. The experience I have gained so far in supply chain management can be applied to manage supplies in a big international company. Florida Tile Inc has a career opportunity in the supply chain management. Florida Tile Inc is one of the largest producers and suppliers of ceramic and porcelain tiles. Last summer, I did my summer internships in this company though worked in the customer care department. The company has various departments. I contacted Dave Peterson who is the supply chain managers of the company and arranged for an interview to find out more about the position. I explained to him that I am a student who is interested in the position of supply chain management and looking forward to working in the similar position after college. Mr. Peterson was willing to assist. Name: Dave Peterson Job title: sup ply chain manager Employer: Florida Tile Inc Location: 998 Governors lane, Lexington KY 40513 Business telephone number: 859-219-5200 Date/ Time: Questions and Answers: 1) What did you study in college? a) I studied business management and majored in supply chain management. ... I was called for an interview, which I believe I did well and was later contacted as one of the successful candidates. 4) Did you have experience in supply chain management prior to your current job? a) Before landing a job at the Florida Tile Inc, I worked for Acme Brick Company as clerk in the supplies department where my main duty was documenting orders from customers from various parts of the country. The acme brick company manufactures tiles, block, and bricks. 5) What do you do on a typical workday? a) I work for eight hours a day and my main responsibility is to ensure that our products get nearer our customers on time. I make arrangement on transportation of raw materials and finished products to various destinations and also supervise inventory and storage. 6) Which skills do I require to fit in the same position? a) In order to be successful in this position, you need to be critical thinker as this will enable you solve problems and make good decisions that can translate in to great profits. To solve problems articulately, you need to be decisive and in addition posses good communication skills. 7) How does your department relate with other departments within the company? a) Teamwork is one important strategy for any business to achieve goals. We work as a team with other departments in the company. 8) What are the challenges you face as you go about your daily tasks at work? a) One major challenge in this position is the ever growing and changing technology in the business arena. Keeping up with the pace at times pose challenges to my colleagues and I in the supply chain department. 9) According to your opinion, who is the most important person in the company? a) In any business organization or company, the customers are the most

International HRM Term Paper Example | Topics and Well Written Essays - 750 words

International HRM - Term Paper Example It is a great idea to offer HRM consulting services to private-sector employers located in England and France. It will diversify the operations of the organization and will open up new opportunities for growth and development. By all means the organization must go ahead with this initiative as companies all over the world are looking for HR consulting organizations to assist them with managing global workforce. Global cultural competencies will definitely grow and this is a great opportunity to stay ahead of the competition. At the same time there are various issues that need to be considered for this initiative to be successful. First and the foremost, it is an obvious fact that HRM has only been a part of the organization and not the core business. The core business of the organization has been IT consulting; hence, HR consulting is not the expertise of the company. It also has to be noted that IT consulting has limited clients in the U.S. and Canada. Therefore, venturing into an e ntirely new market with a new service is very risky and calls for caution. There are numerous factors that need to be considered and acted upon for the company to be prepared and competent in order to meet the needs of clients in England and France. The current HR team will not be sufficient to handle the workload and, hence, new recruitments are essential. The HR team will not be addressing issues with respect to internal employees but employees of clients which are international organizations. Hence, now qualified HR professionals need to possess numerous essential competencies, such as â€Å"knowledge of HR strategies, models, methods and techniques; problem-solving skills; people management skills; and, finally, the ability to adapt to international contexts† (Tyler, 2011). Another crucial requirement regarding HR personal is the development of global mind-set. When dealing with people from different cultural backgrounds it is essential to understand their culture. Hence, HR personal needs to be taught global mind-set skills, even though they will be working from offices and visiting the client sites. In order for our HR team to manage or consult on issues with respect to international workforces, there are three main aspects they need to be good at: â€Å"self-awareness, second languages and multicultural savvy† (Tyler, 2011). It is very important to ensure that the above factors are taken into consideration while hiring new HR personnel. HR professionals with an international HR degree would be handy for this project but it is not an absolute necessity. There is no need for a compulsory HR degree courses but it is essential for professionals to at least attend workshops that last from a day to a week. Such workshops, which focus on topics related to globalization, are vital as they help HR professional to better understand international cultures (Tyler, 2011). There are various other factors that need to be considered, such as cultural faux pas. What is considered as good manners in one culture might not be the same in another culture. Hence, cultural competency becomes vital when dealing intercultural organizations. Cultural competency is the ability of an individual to effectively interact and communicate with people from different cultural backgrounds (Tyler, 2011). Effective HR personnel are those who are not only aware of one’s background, views, as well as preferences and bias but also of the whole lot of other important nuances. Only then he/she will be able to effectively understand and manage the human resources in the 21st century organization. Second language acquisition is another important aspect of cultural competence. For example, while dealing with clients from France, it is important to be able to communicate in French. Talent management is a challenge with respect to international management as different practices are employed in different cultures and this leads to divergence of ideologies. V arious factors, such as

Euthanasia sholud be lgalised in the uk'.discuss this statemnt giving Essay

Euthanasia sholud be lgalised in the uk'.discuss this statemnt giving arguments on both sides of the debeate - Essay Example In the United States, individuals such as Dr. Jack Kevorkian popularized the practice, gaining significant media attention in the process; still, it must be mentioned that even as Kevorkian gained some mainstream acceptance, he was ultimately convicted for his actions. While euthanasia is illegal in all countries of the United Kingdom, there remains considerable controversy over this legal stance. While both the British Medical Association and the Church of England oppose euthanasia, the majority of the British public is in favor of legalization (Whiting 2002, p. 42). Considering the both sides of the debate, this essay examines whether euthanasia should be legalized in the United Kingdom. A variety of medical and legal contexts have also investigated the notion of euthanasia. Originally, the NHS indicates that euthanasia was originally prohibited in the United Kingdom in 1961 (‘Euthanasia and assisted suicide’, 2012). Currently this act makes contributing to suicide pun ishable by up to fourteen years in prison. While euthanasia is outlawed in the United Kingdom there are a variety of grey areas wherein end of life issues come to the foreground. Prominently the National Institute for Health and Clinical Excellence (NICE) implemented the Liverpool Care Pathway which allows doctors to place terminally ill patients on pathway towards death. This has engendered controversy from groups indicating it has been implemented too early in life process (Doughty 2012). The United Kingdom has also legally implemented some of these practices through direct patient interaction, as the Mental Capacity Act of 2005 allows individuals to establish advanced directives in the instance they become mentally capacitated (Liddle 2007, p. 94). Additionally, increased attention has been given to euthanasia of premature babies. Otherwise, however, the United Kingdom law still prohibits euthanasia in most circumstances. Within the United Kingdom, some significant medical perspe ctives in favor of euthanasia are emerging, too. For instance, in 2012, in an editorial of one of the British Medical Journal issues, the author urged the British Medical Association to drop their opposition to euthanasia (White 2012). The argument was largely advanced through natural law ethical foundations. Some of the most prominent voices against euthanasia have emerged from the religious strata of society. As Christianity remains the most dominant religion of the United Kingdom and Western society, it has significantly influenced political and legal thought (‘Ethics Guide’ 2012). The Church of England has objected to the practice of euthanasia on a variety of grounds. The Fifth Commandment states, â€Å"You shall not kill† (Catechism of the Catholic Church n.d.). While there is the understanding that committing euthanasia, if considered at an ethical level, is not directly comparable to other acts of killing, from the Christian point of view it still is a ne gative occurrence. The Catholic Catechism states: â€Å"Human life is sacred because from its beginning it involves the creative action of God and it remains forever in a special relationship with the Creator, who is its sole end. God alone is the Lord of life from its beginning until its end: no one can under any circumstance claim for himself the right directly to destroy an innocent human being†

Contract law Essay Example | Topics and Well Written Essays - 1500 words - 1

Contract law - Essay Example In the formation f contracts two elements are vital. Firstly, the "offer," an indication by one person prepared to contract with another, on certain terms, which are fixed, or capable f being fixed at the time the offer is made. Secondly, there must be an "acceptance", an unconditional assent to a definite offer.[2] These two combine to create certainty that a contract has been formed, for, as in Scammell v Ouston (1941),[3] "if an agreement is uncertain on some important issue.the courts will hold there is no contract."[4] Following this, the elements f consideration and intent provide the contract's "body and substance"[5]So, what is meant by "consideration" and "the intention to create legal relations" English law usually requires prof that the parties have made a bargain, or agreement, [6] this is known as the benefit and detriment test. (Currie v Misa (1875) [7] or "a benefit to one party or a detriment to another."[8] So, in practical terms consideration can be defined as what one party in an agreement is giving, or promising, in exchange for what is being given, or promised, by the other side. [9] This provides mutuality, making the contract enforceable. The Oxford Dictionary f Law definition states, "Consideration is essential to the validity f any contract other than one made by deed. Without consideration an agreement not made by deed is not binding; it is a nudum pactum (naked agreement) governed by the maxim ex nudo pacto non oritur action (a right f action does not arise out f a naked agreement.)"[10] English law does not rely on formalities as a way f identifying intention to create a legally binding contract. Instead it focuses on offer, acceptance and consideration. [11] If these are present, and unless rebutted by contrary evidence, courts operate on the basis f two legal presumptions, that there is no intention to be bound in domestic or social arrangements, but there is intention to be bound in commercial agreements. [12] Professor B.A.Hepple claims that there is no need f a separate requirement f intention, and that a bargain, involving mutuality is sufficient. These views are not generally accepted as it is widely agreed that identifying the parties' intentions is essential to the role f the courts when establishing if a contract was made. [13] It is useful to look at why English law has become so reliant on the consideration element f a contract, and why it has frequently been used as the "badge f enforceability,"[14] Professor Atiyah argues that "consideration" originally meant a "reason for enforcing an agreement."[15] Early forms f contract law mainly involved agreements regarding debt, covenant, or detinue ie., wrongful detention f property, and were only binding if under seal. This method, which required a degree f form such as writing or a deed, was used to prevent fraud and proved that there was an intention to create legal relations. Consideration was first used in the sixteenth century when, in order to enforce informal agreements, the law f assumsit was developed.[16] So, while that the law would, "...still not enforce merely gratuitous promises, ... the law had to develop an element that could distinguish between a proper contractual agreement, and something less that would not."[17] Due to the Law f Property Miscellaneous Provisions Act 1989, form is still required for contracts involving the sale f land. It is also used to offer consumers protection in hire purchase and consumer credit agreements. In the English Common law system, a promise is not legally binding as part f a contract except if it is made in a deed or supported by some consideration. [18] Sir Guenter Treitel Q.C.,

Addictions and interventions Essay Example | Topics and Well Written Essays - 1250 words

Addictions and interventions - Essay Example The following treatment plan and recommendations will be instituted to help make this possible.The type of therapy that will be best suited in aiding Linda to recovery is Cognitive-Behavioral Therapy. The reason this is the best option for Linda is that it will not only help her to recover the quickest, since this type of therapy is the most rapid in producing results, it is the best use of time and resources, as this sort of therapy is a very direct approach, and it is not open ended in the way that other therapies are, such as psycho-analysis (National Association of Cognitive-Behavioral Therapists, 2009). Another reason that Linda will benefit from Cognitive-Behavioral Therapy is that it will enable her to think differently about her circumstances, even if they cannot be changed (National Association of Cognitive-Behavioral Therapists, 2009). For instance, she lives in a poor part of town. While she may not be able to change that immediately or even at all, Cognitive-Behavior Ther apy will assist her in learning to view her circumstances differently. The results of Cognitive Behavioral Therapy are long term. This is due to the fact that the client will understand how and what to do in order to make things better, and then they will be able to apply it, even after therapy has ended. (National Association of Cognitive-Behavioral Therapists, 2009). Linda and I can work together, and she will feel involved in her treatment, which will give her the incentive to want to do better. As far as having others involved in working on the case, I would prefer to work with Linda alone, since it is vital that she and I establish a relationship where she is comfortable opening up to me and expressing her feelings. If too many other professionals are involved in her case, it would be to her detriment because she would not have the chance to form a bond with me that would allow her to feel comfortable enough to work with me in improving her life and setting goals. Cognitive-Behavior therapy is most effective when sessions involve only the client and the therapist, not multiple professionals (National Association of Cognitive-Behavioral Therapists, 2009). There will be a number of things that I will need to know about Linda in order for the use of Cognitive-behavior therapy to be best effective in helping her to recover. One thing that I will like to know about Linda is what she'd like to get out of life. Knowing this bit of information will enable me to help her set goals and come up with different strategies that will help her to achieve those goals. Secondly, I will like her to tell me a little about herself and what makes her feel the need to engage in using drugs. Knowing her reasons for why she feels the need to engage in this behavior will enable me to better know and understand her, so I will be able to tailor the therapy sessions to best suit her needs. Finally, I will ask her how she feels about herself and her current circumstances. Knowing about these things will enable me to help her to set goals o either change her attitude or change her world. Though I'd love to focus on every aspect of Linda, this would be impossible due to time constraints and limited resources. So in order to make the best use of the time and resources that are available to me in dealing with this case, it will be advantageous for me to focus on aspects of her life and character that are of vital importance. Two major areas that deserve the utmost attention are helping her to establish goals on fighting her addiction and helping her to think of herself and her circumstances in a different light. When it comes

Revelation Paper Essay Example | Topics and Well Written Essays - 500 words

Revelation Paper - Essay Example An aspect of similarity between the Martyrdom of Perpetua, Philistas and her companions at one end and Polycarp at the other is underscored by the fact that in both cases, God allows His faithful to undergo martyrdom. This immediately serves as a strong antithesis to the presently famous doctrine being touted by televangelists that with faith, God can do anything for a Christian, if that Christian has faith. This prosperity gospel insinuates that God’s blessings and primary will amount to physical and material gains and consummation of earthly goals. On the contrary, it is apparent that immediately Perpetua has a revelation from God [through a vision wherein the Lord is presented as a Shepherd], together with her companions, they all become aware that the impending martyrdom is God’s will. A very devoted and godly man, Polycarp also undergoes martyrdom. Through the experiences that transpire in the lives of Perpetua and her companions and Polycarp, it becomes clear that God may love His people very much, to the point of taking them home, to be with them forever- and martyrdom or natural death [as is the case of St. John the Divine] may be an instrument God uses to achieve this purpose. The crux of the matter herein is that at some instances, God may glorify Himself through martyrdom, as is the case of Perpetua and her companions and Polycarp’s martyrdom. Again, contrary to modern day teaching, martyrdom is also presented as a way of God’s deliverance for His children (Amat, 1996). Growing up over the years, I have come to appreciate the harmony I have acquired from my religious heritage. The matter here is that I have benefited immensely from the roles that my father and mother have dispensed as individuals and as unique members of the family, just as the Quran and the Hadith stipulate. Because of this, I have been able to have a stable and orderly family where the roles of each parent are effectively and timely discharged. Over time, I have come to

The Inspectors Calls Essay Example for Free

The Inspectors Calls Essay Explore how effectively Priestly delivers his moral message by analysing the roles of the inspector and Mr Birling An Egalitarian would believe that everyone should be equal, either financially or socially. An Egalitarian would want the treatment of everybody to be positive, fair and the same hence we are members of one body they believe there should be no segregation for who they are. These are views of the inspector. He cares about the working middle class of society because of the way he feels theyre being treated in life. A perfect example of this is Eva Smith. Shes a working class woman that struggles and work, to try and get a decent lifestyle compared to the upper class capitalists. Capitalist views are basically about money, business, profit, their financial needs and themselves. They are very self-cantered arrogant. Just like Mr Birling. The Capitalist views are obviously put into practise in him and his family. For one, Mr Birling cares very much about his business and money. This is shown by the situation with Eva Smith and his employers. He refuses to give a small pay rise. They wanted the rates raised so that they could average about twenty-five shillings a week. I refused, of course. This results to Mr Birling taking the first sinful act towards Eva smith. Unlike Mr Birling his old fashioned views, the inspector shows that he cares about the working class by investing Eva Smiths case and making everyone of the Birling family feel bad to see what they did wrong. He keeps on implying what they did wrong how they affected Eva but youre partly to blame. just as your father is, (harshly) Yes. But you cant. its too late. This represents what their beliefs are and how it affects the working class. Because of Mr Billings selfishness profiting thoughts, he sacks Eva. Id agreed to this demand for a new rate wed have added about twelve per cent to our labour costs So I refused. and if they didnt like those rates, they could go work somewhere else He affects her by putting her out of a job, earning no money while he doesnt think twice about her after that and goes about his business, She had a lot to say far too much -so she had to go unlike the inspector and his views. He wants to achieve recognition of the way the working class are being treated. When the word Goole comes to mind, it can mean different function and meanings. Goole sounds as if it was mysterious ghostly characteristics, sound to the word. It can also sound as if it was said with authority. That could represent a judge, a truthful person and it actually comes into play with the inspector. He tells makes the truth come out, as if he serves justice to Eva Smith and the working class. He makes retribution to Eva and slightly revengeful towards the Birling family on the behalf of Eva Smith. With the inspector as well, he can be shown as a fantasy character. He is there with the family, asking questions about something that hasnt even happened yet, but when Gerald goes out and asks about him outside. I met a police sergeantthere wasnt any Inspector Goole or anybody like him on the force. They havent even heard of the inspector. He doesnt exist. This could represent an illusion. The Inspector is shown in the play to be final, significant, decisive and strong minded. He knows what hes doing. Hes intelligent, he speaks when its necessary and in addition he is in control, for instance, he shows the photograph of Eva Smith to the person he is referring to. Not anybody else (INSPECTOR takes a photograph, about postcard size, out of his pocket and goes to BIRLING. Both GERALD and ERIC rise to have a look at the photograph, but the INSPECTOR interposes himself between them and the photograph.) Hes not the head of the house hold or an upper class figure, but he stays in control unlike Mr Birling. Mr Birling is narrow minded nonsensical, Gibberish within form of lectures. He talks about historical periods/ events which happened the titanic said that it will be unsinkable, absolutely unsinkable but in fact, what he said was incorrect. The Titanic actually did sink. Priestly presents these two characters to reflect whats happening in his society in that time. Mr Birling is obviously portrayed to be the higher class (with little things such as having a butler, being friends with people with a higher social status and playing golf) Priestly makes them come across as a self centered, cold hearted, nonsensical man. This portrays what he thinks about the upper class where as The Inspector is caring but stern, purposeful as well, he represents the middle working class. Priestly portrays The Inspector as if he was a messenger, to deliver his ward to the upper class society. He wanted to make the audience see what was happening and the effect/consequences of the strong class divisions and to give his opinion of what he thought of the divisions. Mr Birling is revealed to be inconsiderate, stuck up character. You can see this by what he says Nothing to do with you run alongto Sheila and to the inspectorI dont like your tone (rather angrily impatiently and sharply). All of these show his emotions personality because hes a capitalist, he is used to luxury and hes grown up to look down on the lower class. The stage directions gives us, the readers a visual image of what Mr Birlings doing whether its the way he talks, walks, facial expression, body language or style. Mr Birling body language seems to be stiff, enclosed just by how he is described in the text by the use of language for his character. She looks attentive just after Mr Birling mentions this concerns you too compared to him, The Inspector is a purposeful, stern observing. He looks at everybody and judges everyone by looking hard at each person, as if he was scanning the persons database of personality history. He is purposeful Creates at once an impression of a m assiveness, solidity purposefulness. Priestly wants us to feel different emotions towards them. He wants us to make us see where they are coming from, what their problems are to feel how other people reacts with them e.g. Sheila. Sheila is Mr Birlings daughter even though she added another situation/sin on top of all thats been happening to Eva, unlike the others, she shows remorse when she says: no, not really, it was my own fault. she looks at it closely, recognises it [the picture of Eva] with a little cry and then runs out. Sheila is different to the others because she is the only one that shows remorse guilt and confesses that it was her own fault. Overall he wants the audience to feel each characters personality, attitude, and their way of seeing thing. if the reader gets that, they will see his message. At first the mood of the house is calm, formal, subtle joyful because they are celebrating the engagement. Everything is going according to plan; they have all had a good dinner, are celebrating a special occasion are quite pleased with themselves. The room is bright and nothing rude has been said but, when the inspector comes in, the whole atmosphere and mood changes goes the opposite. Its starts quite dark, dull, definitely serious. He creates a heavy impression by just being himself. Someone with authority or someone to be with the law is always not good, so when that someone visits, people will start to feel uncomfortable and slightly distressed. The topics changes to Eva. The inspector jumps right to the point saying (two hours ago a young woman died in the infirmaryshed swallowed a lot of strong disinfectant. Burnt her inside out, that girl being Eva. He tells the truth and he says it how it is. Because the family are upper class, they would not expect this behaviour, they are not used to anybody speaking to them in that manner, so the react shocked and offended. Eventually the celebration party turns into a confession meeting. After everything has happened in act one, all the family sins come out and all are dreading about whats going to happen next. Mr Birling has the control of the household at the start. You would expect this because hes the man/head of the family (father husband), he earns the highest salary in the family, hes a man he is an honourable man (seen by his family and friends) because of his wealth, business social status. Everyone pays attention to him. Hes also respected by his family, but when the inspector comes in, the authority instantly flips over to the inspector because he is a representative of the police and the law ( the Inspector needs not to be a big man bit he creates at once on impression of massiveness, solidity and purposefulness ). When people sees this they will always set the person below the authority figure, in this case, Mr Birling is the underdog and the inspector comes out on top. They would want to know why he is there, what does he want to know and try to get him away as soon as possible. Even Mr Birling abides and obeys him as any other person in the room. This brings down his control level. The inspector also holds control by little thing he does for example: He only shows the photograph between himself and Mr Birling. Everybody else wants to see it but he refuses and does this for a reason, To show an act of authority. Another act is when he lets each character admit their sins towards Eva Smith, but not at once. He controls them by asking questions they unravel themselves, there story they realize they are wrong, to a certain extent he has the ability to make Sheila breakdown (she almost breaks down, but just controls herself)and so he has a play of their emotions Just towards the end of act 1. Mr and Mrs Birling contribute to Evas death by having a large negative impact on the reasons why. Mr Birling sacked Eva for going on strike and standing up for her opinions for a little pay rise. Mr Birling escalates the situation into a bigger thing then it is. It makes him do drastic things. This is the same with Mrs Birling. Both of them refuse anything to do with Eva her death. They define responsibility whatsoever with her. They are more cold-hearted, uncaring than Eric and Sheila. Eric and Sheila show sympathy and remorse, for instance, Sheila and Eric show remorse devastation when they recognise her from the picture or her name/s (Eva Smith/Daisy Renton) ,(QUOTE). They totally understand and take responsibility for what they did wrong. Eric Confesses on what happened with him and Eva he turns out to be the most honest he has the most positive impact then others (quote). Mr Mrs Birling thinks that the investigation that the inspector carries out is inappropriate (quote). Theyre not used to being questioned, let alone with an inspector. Sheila doesnt really act shocked but because shes so isolated and protected she has become young, naive, innocent, vulnerable and blind to the real society and she doesnt see the consequences of the actions that she does, she doesnt see the affects, therefore she is not used to being involved in theses conversations, let alone an investigation. Eric, however, takes it as a shock when he realises the situation and how Eva felt about him in their relationship that they had. Sheila and Eric feel some sort of indication of remorse regret by being worried and not refusing the blame compared to Mr and Mrs Birling who doesnt show any respect or guilt. They are absolutely fixed on theyre not responsible for it. They do not show any signs of that. The audience are expected to feel negative emotions and thoughts towards Mr Mrs Birling because by them not caring about their contributions towards others. Mr Birling has a snobbish personality and feels like he has got the right to look down on everybody and disrespect them. towards Mrs Birling, I think a negative feeling to her would be expected. She too, is as bad as Mr Birling, because she chose not to help Eva smith because of her pride and shame. Both of them represent the upper class and they are represented as bad. For Sheila, Eric and Gerald, the audience will have a feeling of sympathy because they realised what they did wrong and they took responsibility. I think the audience feel changed by the ending result because everything is unravelled and they all eventually realise what they have done. The hint of mystery i.e. the inspector and the actual situation with Eva themselves gives a mysterious edge to it As a reader I feel towards Eva, a sad, sympathetic feeling towards her because if back in time, women were being treated like that, its not pleasant although towards Eric and Gerald I feel that there is hope, hope that they dont become like Mr Birling. They actually show a caring side to Eva. Sheila, I thought she was a spoilt young woman and overprotected by her parents but now she has had reality check. I like her better than I did before.

Art After Philosophy (1969) Joseph Kosuth Essay Example for Free

Art After Philosophy (1969) Joseph Kosuth Essay The fact that it has recently become fashionable for physicists themselves to be sympathetic toward religion . . . marks the physicists’ own lack of confidence in the validity of their hypotheses, which is a reaction on their part from the antireligious dogmatism of nineteenth-century scientists, and a natural outcome of the crisis through which physics has just passed. –A. J. Ayer. . . . once one has understood the Tractatus there will be no temptation to concern oneself anymore with philosophy, which is neither empirical like science nor tautological like mathematics; one will, like Wittgenstein in 1918, abandon philosophy, which, as traditionally understood, is rooted in confusion. –J. O. Urmson. Traditional philosophy, almost by definition, has concerned itself with the unsaid. The nearly exclusive focus on the said by twentieth-century analytical linguistic philosophers is the shared contention that the unsaid is unsaid because it is unsayable. Hegelian philosophy made sense in the nineteenth century and must have been soothing to a century that was barely getting over Hume, the Enlightenment, and Kant.1 Hegel’s philosophy was also capable of giving cover for a defense of religious beliefs, supplying an alternative to Newtonian mechanics, and fitting in with the growth of history as a discipline, as well as accepting Darwinian biology.2 He appeared to give an acceptable resolution to the conflict between theology and science, as well. The result of Hegel’s influence has been that a great majority of contemporary philosophers are really little more than historians of philosophy, Librarians of the Truth, so to speak. One begins to get the impression that there â€Å"is nothing more to be said.† And certainly if one realizes the implications of Wittgenstein’s thinking, and the thinking influenced by him and after him, â€Å"Continental† philosophy need not seriously be considered here.3 Is there a reason for the â€Å"unreality† of philosophy in our time? Perhaps this can be answered by looking into the difference between our time and the centuries preceding us. In the past man’s conclusions about the world were based on the information he had about it – if not specifically like the empiricists, then generally like the rationalists. Often in fact, the closeness between science and philosophy was so great that scientists and philosophers were one and the same person. In fact, from the times of Thales, Epicurus, Heraclitus, and Aristotle to Descartes and Leibnitz, â€Å"the great names in philosophy were often great names in science as well.†4 That the world as perceived by twentieth-century science is a vastly different one than the one of its preceding century, need not be proved here. Is it possible, then, that in effect man has learned so much, and his â€Å"intelligence† is such, that he cannot believe the reasoning of traditional philosophy? That perhaps he knows too much about the world to make those kinds of conclusions? As Sir James Jeans has stated: . . . When philosophy has availed itself of the results of science, it has not been by borrowing the abstract mathematical description of the pattern of events, but by borrowing the then current pictorial description of this pattern; thus it has not appropriated certain knowledge but conjectures. These conjectures were often good enough for the man-sized world, but not, as we now know, for those ultimate processes of nature which control the happenings of the man-sized world, and bring us nearest to the true nature of reality.5 He continues: One consequence of this is that the standard philosophical discussions of many problems, such as those of causality and free will orof materialism or mentalism, are based on an interpretation of the pattern of events which is no longer tenable. The scientific basis of these older discussions has been washed away, and with their disappearance have gone all the arguments . . .6 The twentieth century brought in a time that could be called â€Å"the end of philosophy and the beginning of art.† I do not mean that, of course, strictly speaking, but rather as the â€Å"tendency† of the situation. Certainly linguistic philosophy can be considered the heir to empiricism, but it’s a philosophy in one gear.7 And there is certainly an â€Å"art condition† to art preceding Duchamp, but its other functions or reasons-to-be are so pronounced that its ability to function clearly as art limits its art condition so drastically that it’s only minimally art.8 In no mechanistic sense is there a connection between philosophy’s â€Å"ending† and art’s â€Å"beginning,† but I don’t find this occurrence entirely coincidental. Though the same reasons may be responsible for both occurrences, the connection is made by me. I bring this all up to analyze art’s function and subsequently its viability. And I do so to enable others to understand the reasoning of my – and, by extension, other artists’ – art, as well to provide a clearer understanding of the term â€Å"Conceptual art.†9 THE FUNCTION OF ART The main qualifications to the lesser position of painting is that advances in art are certainly not always formal ones. –Donald Judd (1963). Half or more of the best new work in the last few years has been neither painting nor sculpture. – Donald Judd (1965). Everything sculpture has, my work doesn’t. –Donald Judd (1967). The idea becomes a machine that makes the art. –Sol LeWitt (1965) The one thing to say about art is that it is one thing. Art is art-as-art and everything else is everything else. Art as art is nothing but art. Art is not what is not art. –Ad Reinhardt (1963). The meaning is the use. –Wittgenstein. A more functional approach to the study of concepts has tended to replace the method of introspection. Instead of attempting to grasp or describe concepts bare, so to speak, the psychologist investigates the way in which they function as ingredients in beliefs and in judgments. –Irving M. Copi. Meaning is always a presupposition of function. –T. Segerstedt. . . . the subject matter of conceptual investigations is the meaning of certain words and expressions – and not the things and states of affairs themselves about which we talk, when using those words and expressions. –G. H. Von Wright. Thinking is radically metaphoric. Linkage by analogy is its constituent law or principle, its causal nexus, since meaning only arises through the causal contexts by which a sign stands for (takes the place of) an instance of a sort. To think of anything is to take it as of a sort (as a such and such) and that â€Å"as† brings in (openly or in disguise) the analogy, the parallel, the metaphoric grapple or ground or grasp or draw by which alone the mind takes hold. It takes no hold if there is nothing for it to haul from, for its thinking is the haul, the attraction of likes –I. A. Richards. In this section I will discuss the separation between aesthetics and art; consider briefly formalist art (because it is a leading proponent of the idea of aesthetics as art), and assert that art is analogous to an analytic proposition, and that it is art’s existence as a tautology that enables art to remain â€Å"aloof† from philosophical presumptions. It is necessary to separate aesthetics from art because aesthetics deals with opinions on perception of the world in general. In the past one of the two prongs of art’s function was its value as decoration. So any branch of philosophy that dealt with â€Å"beauty† and thus, taste, was inevitably duty bound to discuss art as well. Out of this â€Å"habit† grew the notion that there was a conceptual connection between art and aesthetics, which is not true. This idea never drastically conflicted with artistic considerations before recent times, not only because the morphological characteristics of art perpetuated the continuity of this error, but as well, because the apparent other â€Å"functions† of art (depiction of religious themes, portraiture of aristocrats, detailing of architecture, etc.) used art to cover up art. When objects are presented within the context of art (and until recently objects always have been used) they are as eligible for aesthetic consideration as are any objects in the world, and an aesthetic consideration of an object existing in the realm of art means that the object’s existence or functioning in an art context is irrelevant to the aesthetic judgment. The relation of aesthetics to art is not unlike that of aesthetics to architecture, in that architecture has a very specific function and how â€Å"good† its design is is primarily related to how well it performs its function. Thus, judgments on what it looks like correspond to taste, and we can see that throughout history different examples of architecture are praised at different times depending on the aesthetics of particular epochs. Aesthetic thinking has even gone so far as to make examples of architecture not related to â€Å"art† at all, works of art in themselves (e.g., the pyramids of Egypt). Aesthetic considerations are indeed always extraneous to an object’s function or â€Å"reason-tobe.† Unless of course, that object’s reason-to-be is strictly aesthetic. An example of a purely aesthetic object is a decorative object, for decoration’s primary function is â€Å"to add something to, so as to make more attractive; adorn; ornament,†10 and this relates directly to taste. And this leads us directly to â€Å"formalist† art and criticism.11 Formalist art (painting and sculpture) is the vanguard of decoration, and, strictly speaking, one could reasonably assert that its art condition is so minimal that for all functional purposes it is not art at all, but pure exercises in aesthetics. Above all things Clement Greenberg is the critic of taste. Behind every one of his decisions is an aesthetic judgment, with those judgments reflecting his taste. And what does his taste reflect? The period he grew up in as a critic, the period â€Å"real† for him: the fifties.12 How else can one account for, given his theories – if they have any logic to them at all – his disinterest in Frank Stella, Ad Reinhardt, and others applicable to his historical scheme? Is it because he is â€Å". . . basically unsympathetic on personally experiential grounds†?13 Or, in other words, â€Å"their work doesn’t suit his taste?† But in the philosophic tabula rasa of art, â€Å"if someone calls it art,† as Don Judd has said, â€Å"it’s art.† Given this, formalist painting and sculpture can be granted an â€Å"art condition,† but only by virtue of their presentation in terms of their art idea (e.g., a rectangular-shaped canvas stretched over wooden supports and stained with such and such colors, using such and such forms, giving such and such a visual experience, etc.). If one looks at contemporary art in this light one realizes the minimal creative effort taken on the part of formalist artists specifically, an d all painters and sculptors (working as such today) generally. This brings us to the realization that formalist art and criticism accepts as a definition of art one that exists solely on morphological grounds. While a vast quantity of similar looking objects or images (or visually related objects or images) may seem to be related (or connected) because of a similarity of visual/experiential â€Å"readings,† one cannot claim from this an artistic or conceptual relationship. It is obvious then that formalist criticism’s reliance on morphology leads necessarily with a bias toward the morphology of traditional art. And in this sense their criticism is not related to a â€Å"scientific method† or any sort of empiricism (as Michael Fried, with his detailed descriptions of paintings and other â€Å"scholarly† paraphernalia would want us to believe). Formalist criticism is no more than an analysis of the physical attributes of particular objects that happen to exist in a morphological context. But this doesn’t add any knowledge (or facts) to our understanding of the nature or function of art. And neither does it comment on whether or not the objects analyzed are even works of art, in that formalist critics always bypass the conceptual element in works of art. Exactly why they don’t comment on the conceptual element in works of art is precisely because formalist art is only art by virtue of its resemblance to earlier works of art. It’s a mindless art. Or, as Lucy Lippard so succinctly described Jules Olitski’s paintings: â€Å"they’re visual Muzak.† 14 Formalist critics and artists alike do not question the nature of art, but as I have said elsewhere: Being an artist now means to question the nature of art. If one is questioning the nature of painting, one cannot be questioning the nature of art. If an artist accepts painting (or sculpture) he is accepting the tradition that goes with it. That’s because the word art is general and the word painting is specific. Painting is a kind of art. If you make paintings you are already accepting (not questioning) the nature of art. One is then accepting the nature of art to be the European tradition of a painting-sculpture dichotomy.15 The strongest objection one can raise against a morphological justification for traditional art is that morphological notions of art embody an implied a priori concept of art’s possibilities. And such an a priori concept of the nature of art (as separate from analytically framed art propositions or â€Å"work,† which I will discuss later) makes it, indeed, a priori: impossible to question the nature of art. And this questioning of the nature of art is a very important concept in understanding the function of art. The function of art, as a question, was first raised by Marcel Duchamp. In fact it is Marcel Duchamp whom we can credit with giving art its own identity. (One can certainly see a tendency toward this self-identification of art beginning with Manet and Cà ©zanne through to Cubism,16 but their works are timid and ambiguous by comparison with Duchamp’s.) â€Å"Modern† art and the work before seemed connected by virtue of their morphology. Another way of putting it would be that art’s â€Å"language† remained the same, but it was saying new things. The event that made conceivable the realization that it was possible to â€Å"speak another language† and still make sense in art was Marcel Duchamp’s first unassisted Ready-made. With the unassisted Ready-made, art changed its focus from the form of the language to what was being said. Which means that it changed the nature of art from a question of morphology to a question of function. This change – one from â€Å"appearance† to â€Å"conception† – was the beginning of â€Å"modern† art and the beginning of conceptual art. All art (after Duchamp) is conceptual (in nature) because art only exists conceptually. The â€Å"value† of particular artists after Duchamp can be weighed according to how much they questioned the nature of art; which is another way of saying â€Å"what they added to the conception of art† or what wasn’t there before they started. Artists question the nature of art by presenting new propositions as to art’s nature. And to do this one cannot concern oneself with the handed-down â€Å"language† of traditional art, as this activity is based on the assumption that there is only one way of framing art propositions. But the very stuff of art is indeed greatly related to â€Å"creating† new propositions. The case is often made – particularly in reference to Duchamp – that objects of art (such as the Ready-mades, of course, but all art is implied in this) are judged as objets d’art in later years and the artists’ intentions become irrelevant. Such an argument is the case of a preconceived notion ordering together not necessarily related facts. The point is this: aesthetics, as we have pointed out, are conceptually irrelevant to art. Thus, any physical thing can become objet d’art, that is to say, can be considered tasteful, aesthetically pleasing, etc. But this has no bearing on the object’s application to an art context; that is, its functioning in an art context. (E.g., if a collector takes a painting, attaches legs, and uses it as a dining table it’s an act unrelated to art or the artist because, as art, that wasn’t the artist’s intention.) And what holds true for Duchamp’s work applies as well to most of the art after him. In other words, the value of Cubism – for instance – is its idea in the realm of art, not the physical or visual qualities seen in a specific painting, or the particularization of certain colors or shapes. For these colors and shapes are the art’s â€Å"language,† not its meaning conceptually as art. To look upon a Cubist â€Å"masterwork† now as art is nonsensical, conceptually speaking, as far as art is concerned. (That visual information that was unique in Cubism’s language has now been generally absorbed and has a lot to do with the way in which one deals with painting â€Å"linguistically.† [E.g., what a Cubist painting meant experimentally and conceptually to, say, Gertrude Stein, is beyond our speculation because the same painting then â€Å"meant† something different than it does now.]) The â€Å"value† now of an original Cubist painting is not unlike, in most respects, an original manuscript by Lord Byron, or The Spirit of St. Louis as it is seen in the Smithsonian Institution. (Indeed, museums fill the very same function as the Smithsonian Institution – why else would the Jeu de Paume wing of the Louvre exhibit Cà ©zanne’s and Van Gogh’s palettes as proudly as they do their paintings?) Actual works of art are little more than historical curiosities. As far as art is concerned Van Gogh’s paintings aren’t worth any more than his palette is. They are both â€Å"collectors items.†17 Art â€Å"lives† through influencing other art, not by existing as the physical residue of an artist’s ideas. The reason that different artists from the past are â€Å"brought alive† again is because some aspect of their work becomes â€Å"usable† by living artists. That there is no â€Å"truth† as to what art is seems quite unrealized. What is the function of art, or the nature of art? If we continue our analogy of the forms art takes as being art’s language one can realize then that a work of art is a kind of proposition presented within the context of art as a comment on art. We can then go further and analyze the types of â€Å"propo sitions.† A. J. Ayer’s evaluation of Kant’s distinction between analytic and synthetic is useful to us here: â€Å"A proposition is analytic when its validity depends solely on the definitions of the symbols it contains, and synthetic when its validity is determined by the facts of experience.†18 The analogy I will attempt to make is one between the art condition and the condition of the analytic proposition. In that they don’t appear to be believable as anything else, or be about anything (other than art) the forms of art most clearly finally referable only to art have been forms closest to analytical propositions. Works of art are analytic propositions. That is, if viewed within their context – as art – they provide no information whatsoever about any matter of fact. A work of art is a tautology in that it is a presentation of the artist’s intention, that is, he is saying that that particular work of art is art, which means, is a definition of art. Thus, that it is art is true a priori (which is what Judd means when he states that â€Å"if someone calls it art, it’s art†). Indeed, it is nearly impossible to discuss art in general terms without talking in tautologies – for to attempt to â€Å"grasp† art by any other â€Å"handle† is merely to focus on another aspect or quality of the proposition, which is usually irrelevant to the artwork’s â€Å"art condition.† One begins to realize that art’s â€Å"art condition† is a conceptual state. That the language forms that the artist frames his propositions in are often â€Å"private† codes or languages is an inevitable outcome of art’s freedom from morphological constrictions; and it follows from this that one has to be familiar with contemporary art to appreciate it and understand it. Likewise one understands why the â€Å"man in the street† is intolerant to artistic art and always demands art in a tr aditional â€Å"language.† (And one understands why formalist art sells â€Å"like hot cakes.†) Only in painting and sculpture did the artists all speak the same language. What is called â€Å"Novelty Art† by the formalists is often the attempt to find new languages, although a new language doesn’t necessarily mean the framing of new propositions: e.g., most kinetic and electronic art. Another way of stating, in relation to art, what Ayer asserted about the analytic method in the context of language would be the following: The validity of artistic propositions is not dependent on any empirical, much less any aesthetic, presupposition about the nature of things. For the artist, as an analyst, is not directly concerned with the physical properties of things. He is concerned only with the way (1) in which art is capable of conceptual growth and (2) how his propositions are capable of logically following that growth.19 In other words, the propositions of art are not factual, but linguistic in character – that is, they do not describe the behavior of physical, o r even mental objects; they express definitions of art, or the formal consequences of definitions of art. Accordingly, we can say that art operates on a logic. For we shall see that the characteristic mark of a purely logical inquiry is that it is concerned with the formal consequences of our definitions (of art) and not with questions of empirical fact.20 To repeat, what art has in common with logic and mathematics is that it is a tautology; i.e., the â€Å"art idea† (or â€Å"work†) and art are the same and can be appreciated as art without going outside the context of art for verification. On the other hand, let us consider why art cannot be (or has difficulty when it attempts to be) a synthetic proposition. Or, that is to say, when the truth or falsity of its assertion is verifiable on empirical grounds. Ayer states: . . . The criterion by which we determine the validity of an a priori or analytical proposition is not sufficient to determine the validity of an empirical or synthetic proposition. For it is characteristic of empirical propositions that their validity is not purely formal. To say that a geometrical proposition, or a system of geometrical propositions, is false, is to say that it is self-contradictory. But an empirical proposition, or a system of empirical propositions, may be free from contradiction and still be false. It is said to be false, not because it is formally defective, but because it fails to satisfy some material criterion.21 The unreality of â€Å"realistic† art is due to its framing as an art proposition in synthetic terms: one is always tempted to â€Å"verify† the proposition empirically. Realism’s synthetic state does not bring one to a circular swing back into a dialogue with the larger framework of questions about the nature of art (as does the work of Malevich, Mondrian, Pollock, Reinhardt, early Rauschenberg, Johns, Lichtenstein, Warhol, Andre, Judd, Flavin, LeWitt, Morris, and others), but rather, one is flung out of art’s â€Å"orbit† into the â€Å"infinite space† of the human condition. Pure Expressionism, continuing with Ayer’s terms, could be considered as such: â€Å"A sentence which consisted of demonstrative symbols would not express a genuine proposition. It would be a mere ejaculation, in no way characterizing that to which it was supposed to refer.† Expressionist works are usually such â€Å"ejaculations† presented in the morphological language of traditional art. If Pollock is important it is because he painted on loose canvas horizontally to the floor. What isn’t important is that he later put those drippings over stretchers and hung them parallel to the wall. (In other words what is important in art is what one brings to it, not one’s adoption of what was previously existing.) What is even less important to art is Pollock’s notions of â€Å"self-expression† because those kinds of subjective meanings are useless to anyone other than those involved with him personally. And their â€Å"specific† quality puts them outside of art’s context. â€Å"I do not make art,† Richard Serra says, â€Å"I am engaged in an activity; if someone wants to call it art, that’s his business, but it’s not up to me to decide that. That’s all figured out later.† Serra, then, is very much aware of the implications of his work. If Serra is indeed just â€Å"figuring out what lead does† (gravitationally, molecularly, etc.), why should anyone think of it as art? If he doesn’t take the responsibility of it being art, who can, or should? His work certainly appears to be empirically verifiable: lead can do, and be used for, many physical activities. In itself this does anything but lead us into a dialogue about the nature of art. In a sense then he is a primitive. He has no idea about art. How is it then that we know about â€Å"his activity†? Because he has told us it is art by his actions after â€Å"his activity† has taken place. That is, by the fact that he is with several galleries, puts the physical residue of his activity in museums (and sells them to art collectors – but as we have pointed out, collectors are irrelevant to the â€Å"condition of art† of a work). That he denies his work is art but plays the artist is more than just a paradox. Serra secretly feels that â€Å"arthood† is arrived at empirically. Thus, as Ayer has stated: There are no absolutely certain empirical propositions. It is only tautologies that are certain. Empirical questions are one and all hypotheses, which may be confirmed or discredited in actual sense experience. And the propositions in which we record the observations that verify these hypotheses are themselves hypotheses which are subject to the test of further sense experience. Thus there is no final proposition.22 What one finds all throughout the writings of Ad Reinhardt is this very similar thesis of â€Å"artas-art,† and that â€Å"art is always dead, and a ‘living’ art is a deception.†23 Reinhardt had a very clear idea about the nature of art, and his importance is far from recognized. Because forms of art that can be considered synthetic propositions are verifiable by the world, that is to say, to understand these propositions one must leave the tautological-like framework of art and consider â€Å"outside† information. But to consider it as art it is necessary to ignore this same outside information, because outside information (experiential qualities, to note) has its own intrinsic worth. And to comprehend this worth one does not need a state of â€Å"art condition.† From this it is easy to realize that art’s viability is not connected to the presentation of visual (or other) kinds of experience. That that may have been one of art’s extraneous functions in the preceding centuries is not unlikely. After all, man in even the nineteenth century lived in a fairly standardized visual environment. That is, it was ordinarily predictable as to what he would be coming into contact with day after day. His visual environment in the part of the world in which he lived was fairly consistent. In our time we have an experientially drastically richer environment. One can fly all over the earth in a matter of hours and days, not months. We have the cinema, and color television, as well as the man-made spectacle of the lights of Las Vegas or the skyscrapers of New York City. The whole world is there to be seen, and the whole world can watch man walk on the moon from their living rooms. Certainly art or objects of painting and sculpture cannot be expected to compete experientially with this? The notion of â€Å"use† is relevant to art and its â€Å"language.† Recently the box or cube form has been used a great deal within the context of art. (Take for instance its use by Judd, Morris, LeWitt, Bladen, Smith, Bell, and McCracken – not even mentioning the quantity of boxes and cubes that came after.) The difference between all the various uses of the box or cube form is directly related to the differences in the intentions of the artists. Further, as is particularly seen in Judd’s work, the use of the box or cube form illustrates very well our earlier claim that an object is only art when placed in the context of art. A few examples will point this out. One could say that if one of Judd’s box forms was seen filled with debris, seen placed in an industrial setting, or even merely seen sitting on a street corner, it would not be identified with art. It follows then that understanding and consideration of it as an artwork is necessary a priori to viewing it in order to â€Å"see† it as a work of art. Advance information about the concept of art and about an artist’s concepts is necessary to the appreciation and understanding of contemporary art. Any and all of the physical attributes (qualities) of contemporary works, if considered separately and/or specifically, are irrelevant to the art concept. The art concept (as Judd said, though he didn’t mean it this way) must be considered in its whole. To consider a concept’s parts is invariably to consider aspects that are irrelevant to its art condition – or like reading parts of a definition. It comes as no surprise that the art with the least fixed morphology is the example from which we decipher the nature of the general term â€Å"art.† For where there is a context existing separately of its morphology and consisting of its function one is more likely to find results less conforming and predictable. It is in modern art’s possession of a â€Å"language† with the shortest history that the plausibility of the abandonment of that â€Å"language† becomes most possible. It is understandable then that the art that came out of Western painting and sculpture is the most energetic, questioning (of its nature), and the least assuming of all the general â€Å"art† concerns. In the final analysis, however, all of the arts have but (in Wittgenstein’s terms) a â€Å"family† resemblance. Yet the various qualities relatable to an â€Å"art condition† possessed by poetry, the novel, the cinema, the theatre, and various forms of mus ic, etc., is that aspect of them most reliable to the function of art as asserted here. Is not the decline of poetry relatable to the implied metaphysics from poetry’s use of â€Å"common† language as an art language?24 In New York the last decadent stages of poetry can be seen in the move by â€Å"Concrete† poets recently toward the use of actual objects and theatre.25 Can it be that they feel the unreality of their art form? We see now that the axioms of a geometry are simply definitions, and that the theorems of a geometry are simply the logical consequences of these definitions. A geometry is not in itself about physical space; in itself it cannot be said to be â€Å"about† anything. But we can use a geometry to reason about physical space. That is to say, once we have given the axioms a physical interpretation, we can proceed to apply the theorems to the objects which satisfy the axioms. Whether a geometry can be applied to the actual physical world or not, is an empirical question which falls outside the scope of geometry itself. There is no sense, therefore, in asking which of the various geometries known to us are false and which are true. Insofar as they are all free from contradiction, they are all true. The proposition which states that a certain application of a geometry is possible is not itself a proposition of that geometry. All that the geometry itself tells us is that if anything can be brought under the definitions, it will also satisfy the theorems. It is therefore a purely logical system, and its propositions are purely analytic propositions. –A. J. Ayer26 Here then I propose rests the viability of art. In an age when traditional philosophy is unreal because of its assumptions, art’s ability to exist will depend not only on its not performing a service – as entertainment, visual (or other) experience, or decoration – which is something easily replaced by kitsch culture, and technology, but, rather, it will remain viable by not assuming a philosophical stance; for in art’s unique character is the capacity to remain aloof from philosophical judgments. It is in this context that art shares similarities with logic, mathematics, and, as well, science. But whereas the other endeavors are useful, art is not. Art indeed exists for its own sake. In this period of man, after philosophy and religion, art may possibly be one endeavor that fulfills what another age might have called â€Å"man’s spiritual needs.† Or, another way of putting it might be that art deals analogously with the state of things â€Å"beyond physics† where philosophy had to make assertions. And art’s strength is that even the preceding sentence is an assertion, and cannot be verified by art. Art’s only claim is for art. Art is the definition of art. NOTES * Reprinted from Studio International (October, 1969). 1 Morton White, The Age of Analysis (New York: Mentor Books), p. 14. 2 Ibid., p. 15. 3 I mean by this Existentialism and Phenomenology. Even Merleau-Ponty, with his middle-of-the-road position between empiricism and rationalism, cannot express his philosophy without the use of words (thus using concepts); and following this, how can one discuss experience without sharp distinctions between ourselves and the world? 4 Sir James Jeans, Physics and Philosophy (Ann Arbor, Mich.: University of Michigan Press), p. 17. 5 Ibid., p. 190. 6 Ibid., p. 190. 7 The task such philosophy has taken upon itself is the only â€Å"function† it could perform without making philosophic assertions. 8 This is dealt with in the following section. 9 I would like to make it clear, however, that I intend to speak for no one else. I arrived at these conclusions alone, and indeed, it is from this thinking that my art since 1966 (if not before) evo lved. Only recently did I realize after meeting Terry Atkinson that he and Michael Baldwin share similar, though certainly not identical, opinions to mine. 10 Webster’s New World Dictionary of the American Language. 11 The conceptual level of the work of Kenneth Noland, Jules Olitski, Morris Louis, Ron Davis, Anthony Caro, John Hoyland, Dan Christensen, et al., is so dismally low, that any that is there is supplied by the critics promoting it. This is seen later. 12 Michael Fried’s reasons for using Greenberg’s rationale reflect his background (and most of the other formalist critics) as a â€Å"scholar,† but more of it is due to his desire, I suspect, to bring his scholarly studies into the modern world. One can easily sympathize with his desire to connect, say, Tiepolo with Jules Olitski. One should never forget, however, that a historian loves history more than anything, even art. 13 Lucy Lippard uses this quotation in a footnote to Ad Reinhardt’s retrospective catalogue, January, 1967, p. 28. 14 Lucy Lippard, â€Å"Constellation by Harsh Daylight: The Whitney Annual,† Hudson Review, Vol. 21, No. 1 (Spring, 1968). 15 Arthur R. Rose, â€Å"Four Interviews,† Arts Magazine (February, 1969). 16 As Terry Atkinson pointed out in his introduction to Art-Language (Vol. 1, No. 1), the Cubists never questioned if art had morphological characteristics, but which ones in painting were acceptable. 17 When someone â€Å"buys† a Flavin he isn’t buying a light show, for if he was he could just go to a hardware store and get the goods for considerably less. He isn’t â€Å"buying† anything. He is subsidizing Flavin’s activity as an artist. 18 A. J. Ayer, Language, Truth, and Logic (New York: Dover Publications), p. 78. 19 Ibid., p. 57. 20 Ibid., p. 57. 21 Ibid., p.90. 22 Ibid., p. 94. 23 Ad Reinhardt’s retrospective catalogue (Jewish Museum, January, 1967) written by Lucy Lippard, p. 12. 24 It is poetry’s use of common language to attempt to say the unsayable that is problematic, not any inherent problem in the use of language within the context of art. 25 Ironically, many of them call themselves â€Å"Conceptual Poets.† Much of this work is very similar to Walter de Maria’s work and this is not coincidental; de Maria’s work functions as a kind of â€Å"object† poetry, and his intentions are very poetic: he really wants his work to change men’s lives. 26 Op. cit., p. 82.