Report for potential investors in tesco plc

Report for potential investors in tesco plc The purpose of this report is for potential investors who are considering buying shares in Tesco plc. The report creates an overall picture of Tescos financial position and provides an assessment of Tescos performance over the last three years. The information used to assess the financial position of Tesco was gathered from the Annual report of the last three years. This information was downloaded from the official Tesco website. From that, the ratios were calculated from the financial statements within the report. Results Ratios 2004 2005 2006 Change (%) Return on capital employed 13.99% 14.77% 17.29% 19.09% increase Net profit Margin 5.17% 5.76% 5.78% 10% increase Asset Turnover 2.72 times 2.56 times 2.99 times 9.03% increase Current Assets 0.56 times 0.57 times 0.52 times 8.77% decrease Quick Ratio 0.35:1 0.35:1 0.33:1 05.71% decrease Gearing Analysis 35.35% 34.52% 28.38% 19.72% decrease Interest Cover 7.75 8.31 9.46 18.08% increase Earning per share 15.05p 17.44p 20.07p 25.01% increase Dividend Cover 2.13 times 2.29 times 2.57 times 17.12% increase Introduction The aim of this report is to provide an assessment of the companys performance over the three year period to a group of potential investors in the company. So this report will use nine financial ratios which are useful for the investors to help them to identify and highlight area of good and bad performance of the company and area with significant change. Therefore this report will consist: brief overview of the history of Tesco and Then it will analyse the profitability, liquidity, investment analysis of Tesco plc. The report will also advice potential investors on whether shares in this company would be a good investment. Brief Background on Tesco plc It is best known that Tesco Company is the leading retailer in the UK and one of the largest food retailers in the world. The retail industry is a highly competitive market. Tesco competes with a wide range of retailers with a wide range sizes and there face increased competition from UK retailers as well as international operators. Tesco also sell non food goods such as electrical goods and clothing. In general Tesco is a successful profitable company which attract investors to invest in the company. General Financial Analysis It is well known fact that the financial ratios become important for investors to help them whether they should buy shares in the business, sell them, or hold on shares which already own them. Therefore ratios analysis helps investors to identify and highlight area of good and bad performance of the company and area with significant change. In addition, financial ratios explain the relation between different figures in the financial statements consequently we could calculate hundred of ratios fro a set of financial statements, because of this we need to know which ratio provide a good and useful information for the investors , the ratios which are applied incorrectly they may be completely useless and misleading. However if they are used correctly they are useful for understanding the performance of the company and interpreting the company account. Ratios describe the relationship between different items in the financial; however the relative usefulness of each ratio depends on what aspects of a companys business affairs are being investigated. In this case of Tesco plc, there are four elements of ratios that are been analysed. These are Profitability, Liquidity and Investment analysis. Return on Capital Employed (ROCE): The ROCE is an important measure of the profitability of a company. This is because it is a popular indicator of management efficiency by contrasting the net profit generated by the company with the total capital employed (traditionally, total capital employed in this case has been taken to be the long term funding). It does not only incorporate the funds the shareholders have invested, but also funds invested by banks and other lenders, and therefore shows the productivity of the assets of the group. ROCE = PBIT ÃÆ'-100 Capital employed 2006 = 2,280 ÃÆ'-100 9,444 + 3742 = 17.29% 2005 = 1,952 ÃÆ'-100 4,563 + 8,654 = 14.77% 2004 = 1,729 ÃÆ'-100 7,990 + 4,368 = 13.99 These calculations show that the return on capital employed has been on steadily increasing for the past three years. For 2006, the ROCE is 17.29% which is 1.94 % above the average for the three years. This indicates that Tesco is using its invested resources more efficiently and that by comparing with other leading retailers, they ROCE are higher. This shows that this figure is more likely to be acceptable to potential investor. Comparison on Return on Capital employed Year Tesco plc J Sainsbury plc Morrisons 2004 13.99 7.99 6.01 2005 14.77 -2.56 5.1 2006 17.29 3.73 -5.63 Average 15.35 3.053333333 1.826667 Net profit margin is another widely used ratio in the assessment of company performance and in comparison with companies in the same industry. Net profit margin = Profit before exceptional items, interest tax ÃÆ'-100 Revenue (turnover) 2006 = 2,280 ÃÆ'-100 39,454 = 5.78 % 2005 = 1,952 ÃÆ'-100 33,866 = 5.76 % 2004 = 1,735 ÃÆ'-100 33,557 = 5.17 % From the calculation, it shows that net profit margin has been increasing slightly which shows Tesco have kept control of its expenses. Group sales have increased consistently through 2004/05 by 9.4% and in 2005/06 by 14.33%. (Note: in order for comparisons, two different figures were used in 05 sales due to the implementation of IFRS while the comparison for 04/05 was accounted under the standard of UK GAAP). As for PBIT, there was not much increase in 2004/05, however between 2005/06 there was an increase of 14.16 %. Comparison on Net profit Margin Year Tesco J Sainsbury plc Morrisons 2004 5.17% 3.23% 6.19% 2005 5.77 -0.99% 2.12% 2006 5.78 1.43% 2.17% Average 5.573 0.012 0.035 This shows Tesco average on net profit margin for the past three years is way above the averages of other leading supermarkets. This illustrates that in 2005 and 2006, Tesco profit margin is miles ahead. From this it can be concluded that it is a profitable company which has kept control of its expenses. The Asset Turnover is a measure of how much sales are generated by the capital asset base of a company. Asset turnover = Revenue (turnover) Capital employed For Tesco plc, asset for the three years are as follows: For 2006 = 39,454 13,186 = 2.99 times For 2005 = 33,866 13217 =2.56 times For 2004 = 33,557 12,358 = 2.72 times this shows that asset turnover is slightly increasing. This is due to the fact that revenue has increased considerably from  £33,557 in 2004 to  £39,454 in 2006 Comparison on Asset Turnover Year Tesco plc J Sainsbury plc Morrisons 2004 2.72 2.47 0.98 2005 2.56 2.57 2.59 2006 2.99 2.61 2.59 Average 2.7566667 2.55 2.053333 This shows that Tesco is above the average asset turnover for the market. From this it can be concluded that Tesco is generating more sales from its capital base. Liquidity Analysis It is clear that liquidity ratios analysis important to the investors as liquidity ratios related to the capacity of business to pay its short term debt as become due, therefore the focus is on the relationship between current assets and creditors due within one year, since these measure short term sources of cash and short term calls on that cash, there are two commonly used ratios which highlight such a situation: Current ratios (current assets/current liability) The current ratio measure the relationship between the companys current assets and its current liability in Tesco Companys balance sheet shows the current asset for 2006 3991 and current liability of 7518, the current asset for 2005 3224 current liability 5680, for 2004 current assets 3139 current liability 5618 Current ratios = currents assets Current liabilities For 2006 = 3919 7518 = 0.52 times For 2005 = 3224 5680 = 0.57 times For 2004 = 3139 5618 = 0.56 times It can be seen from the results the current ratio for Tesco company is stable between 2004 and 2005, however it fell slightly in 2006, this is because of the fact that there was an increase in current liabilities. Quick ratios (Current assets inventories) / current liabilities The quick ratios ignore the stock and concentrates upon those assets which can be turned into cash, the quick ratios important for investors who want to take share in Tesco Company where stock is turned over quickly and the sales are mainly on a cash, consequently the quick ratios compares liquid current assets with current liabilities. For 2006 = 3919 1464 7518 = 0.33: 1 For 2005 = 3224 -1309 5680 = 0.35: 1 For 2004 = 3139 1199 5618 = 0.35: 1 As it can be seen from the results the quick ratios test follow much the same trend on average over the three years of 0.34, which shows low level of resources are tied up in inventory. It can also be concluded that Tesco does not have any cash flow problems and therefore the company is using its resources well. Gearing Analysis An important determinant of a companys capacity to develop is its funding structure. This very important as it enables the company to assess its capacity to satisfy its long term commitment. The financial structure of a business is an important consideration when assessing the financial health of any entity. The most commonly used structure is the Gearing ratio, which quantifies the relationship between debt and equity. The higher the ratio then the more vulnerable the company is perceived to be this is because there is a high and fixed call on its profit before equity can be satisfied. This means that a company that has high gearing will has deal with its long term commitment such as long term debt and this in turn means they will be less fund for payment such as dividend for shareholders. Gearing Ratio = Long Term Debt ÃÆ'-100 Capital Employed For 2006 = 3742 ÃÆ'-100 9444 + 3742 = 28.38% For 2005 = 4563 ÃÆ'-100 8654 + 4563 = 34.52% For 2004 = 4368 ÃÆ'-100 7,990 + 4,368 = 35.35 % From these calculations, it shows that the long term debt has been decreasing steadily for the past couple of years while on the other hand the equity of the company has been increasing steadily, which indicate the finances of the company as moving towards equity and less on debt. Interest cover ratio: It is important to recognize that the interest cover ratio is important for investors as they measure the amount of profit available to cover interest payable. The high interest cover ratio it means that the company or business is easily able to meet its interest from profit. in the same way a low value from interest cover ratio it means that the business is in danger to meet its interest obligations therefore the profit available to the shareholder will be very low. In Tesco company the measure of interest cover ratio as follow: Interest cover ratio = profit before interest and tax Interest charge For 2006 = 2280 241 = 9.46 For 2005 = 1952 235 = 8.31 For 2004 = 1729 223 = 7.75 The measure of interest cover ratio of Tesco within the last three years tells us that the company maintaining increase in interest cover ratio 7.75, 8.31, 9.46 as a result Tesco is able to meet its interest from the profit therefore the profit are sufficient to pay the interest it owes and the profit available to the shareholder increased from 1729m in 2004 to 2280 in 2006. Investment Analysis Potential investors who want to buy shares in a company want to be able to have the information they require to compare the benefit from their investment. There are two measures of benefit to the investor: One is the profit of the period (usually referring to the profit available for the ordinary shareholders). The other is the dividend, which is the amount actually paid to the shareholders. Earning Per Share (EPS) EPS is a widely used measure of business performance and progress, and importantly the percentage change from year to year should be monitored for the trend. It explains to an investor the kind of return they could receive for each share during the accounting period. Therefore, it is important ratio as earning per share works out the average amount of profits earned per ordinary share issued. In accordance with FRS 14 Earnings per share, EPS must be disclosed on the face of the income statement. This means that when producing financial statements companies must disclose the EPS figures for investors to see. EPS = Earnings (profit) Number of equity share in issue For 2006 = 1,570 7,823 = 20.07p For 2005 = 1,344 7,707 = 17.44p For 2004 = 1,100 7,307 =15.05p As it can be seeing there has been a steady increase of EPS for the past of years. This indicates that potential investors would have an attractable return on there shares Dividend Cover The dividend cover ratio is another important ratio for potential investors as it measures the proportion of available profits which are issued to shareholders and the amount which is reserved by the company. In another words, the dividend cover ratio tells the investor how easily a business can pay its dividend from its profit. Dividend Cover = Profit after tax Ordinary dividend For 2006 = 1,570 609 = 2.57 times For 2005 = 1,344 587 = 2.29 times For 2004 = 1100 516 =2.13 times The measure of dividend cover ratio of Tesco plc for the last three years has shown a steady increase. It increased slightly from 2004 to 2005 and again in 2006. A high dividend cover means that a company can easily afford to pay dividend. For the last year (2006), the dividend covers shows that for every  £2.57 made in the profit,  £1 was issued to the shareholders Investment Advice Sales have risen by 14.94 %to  £39,454m Pre-tax profits are up by 24%, with earning per share increasing by 25% in 2006 from 2004. This result shows the excellent performance from all aspects of Tesco strategy. This is an extract from the Directors report for 2006: The directors recommend the payment of a final dividend of 6.10p per ordinary share, to be paid on 14 July 2006 to members à ¢Ã¢â€š ¬Ã‚ ¦. Together with the interim dividend of 2.53p per ordinary share paid in December 2005, the total dividend for the year will be 8.63p compared with 7.56p for the previous year, an increase of 14.2% This shows that Tesco plc strong performance is been implemented in dividend as can be seen in the increase of payment. Tesco faces strong competition from other leading supermarket, however with the management strategy implemented by Tesco and their huge experience which has given them good image (every little help!) and trust in the market as a leading retailer. Therefore, it will be worthwhile investment for those who are interested in earning money through share price fluctuations to invest in Tesco. Conclusion This report has used nine ratios to analyse and interpret the financial position of Tesco plc. There are many other ratios that could be used and will also assist in the interpretations of the financial accounts. Although there are limitations to ratio analysis such as; ratios are based upon past performance and hence there are historical data. However ratio analysis is one of the best ways to analyse the financial performance of a company. This is because, it allows managers to spot any problems and therefore concentrate resources on that area. If ratio analysis is interpreted the right way then it can be useful tool of results which can be understood by accountants and non-financial users such potential investors.

Interlaminar Stress Behaviour of the Flywheel Rotor

Interlaminar Stress Behaviour of the Flywheel Rotor 1.1 History of the Flywheel For over thousands of years, flywheels have been used in potter wheels and spindle wheel whorls Gowayed et al., 2002 The concept of storing energy in a rotating disk dates as far back as 2400 BC when rotating wheels were used by Egyptians to handcraft pottery. In fact, flywheel systems were widely used in everyday life (Genta, 1985): in warring chariots, water pumps and even power generations. However, these conventional flywheels are not as efficient as energy storage devices due to the large amount of mass required for the relatively meagre amount of energy stored not to mention the capability of delivering power for only a relatively short period. The advent of the industrial revolution brought about the significant advances of the flywheels. In the 18th century, Man witnessed the widespread use of metal in the construction of machines and soon, flywheel had found its way into steam engines. This development of the flywheel had been attributed to the works of James Watt. With flywheels made of cast iron, a higher mass moment of inertia could be achieve and thus a significant weight saving as well. During the industrial revolution, James Pickard developed a solution for transforming reciprocating to rotary motion with the combination of a crank and flywheel. And it was not till the last thirty years that we witness high performance flywheels being significantly developed with marked improvement and demonstrate the potential as energy storage systems in a wide range of applications. The energy crisis of then 1970s marked the beginning of another significant era for the development of flywheels as the need to search for an alternative energy storage implement. Large amount of money were invested by the governments of many nations into the development of flywheel energy storage technology with subsequent establishment of research programs in the development of flywheel devices as alternative energy storage systems (Genta, 1985). However, development pace since to slow down as fuel prices begin to stabilized in the early 1980s. That particular time period was nevertheless a crucial development era for the flywheel; during which the use of flywheels are explored and developed for electrical vehicles. In addition it was also explored as a device to help utilities manage peak power demand. With the incorporation of high specific strength advanced composite materials into flywheel designs, weight reductions and strength increment can be achieved; and this cannot be achieved with the use of metallic alloy. However, the use of flywheels can yet be commercialized even with the significant improvements in the design concept of flywheel as it remains a challenge still to design flywheel systems that are cost competitive to other energy storage devices. In addition, composites, though stronger than metal, would require the use of advanced bearings due to the inability to withstand certain forces exposed in high performance application (Kim, T.H. 2003). The 1990s witnessed developments in stronger, lightweight composite materials, magnetic bearings and other electronic devices, and all of which contribute to the exciting development of the flywheel. Excessively high rotational speed could now be reached, with a subsequent increment in energy stored, making them a possible candidate again for energy storage system of superior performance. As a summary, the improvement in the flywheel quick energy recovery, high efficiency, low maintenance and long service life, high amount of stored energy per unit volume and mass, high output power levels, as well as lower product and operational cost (Horner, 1996) as well as environmental friendly components are all that have made the flywheel energy storage system a feasible option. 1.1.2 Flywheel as an Energy Storage Device Flywheel energy storage (FES) has, in various past researches, proven its superiority over conventional battery technology based energy storage system in terms of its higher energy density, durability, rapid charge and discharge capability, as well as its tolerance over a wide range of temperature with very minute environmental concerns; and with the progress in power electronics, loss reductions techniques and advanced materials, the then seemingly inconceivable idea of economical flywheel energy storage (FES) devices are no longer chimerical (Hebner et al, 2002). In fact, all of the prepossessing characteristics mentioned briefly above (in comparison with those that of conventional battery system) are what that result in the advanced flywheel systemsà ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ appeal as one of the fast- gaining attention alternative for energy storage devices. (Arvin Bakis, 2006) A flywheel is an inertial energy storage system where the rotating mass functions as the energy storage retainer. While connected to the motor (possibly electrical motor), a flywheel can be accelerated to a specific angular velocity. In this process, electrical energy was converted into kinetic energy and the rotating inertia of the composite rotor acts to store this form of mechanical energy. When the need arises, the mechanical energy can be transformed back to electrical power by the motor. Thus, the motor in the flywheel system acts not merely as a motor to accelerate the energy storing process but also as a generator in recovering the transformed electrical energy. A typical flywheel energy storage system consists of five primary components (Lazarewicz et al., 2006), namely the rotor, the bearings, the motor/generator unit, the vacuum enclosure and the power electronics. A rotor consists of a hub and rim. As the rim is the main rotating mass of the rotor, it is quite easy to comprehend the fact that the rim acts to store most of the energy whereas the hub functions to connect to the rim to a shaft. The rotating flywheel shaft on the other hand is supported by bearings which could either be of the mechanical or magnetic variety. These bearings allow for low resistance to rotor rotation. However, magnetic bearings are preferred over mechanical ones due to the energy loss associated with energy loss. The motor, as the third major component introduced, acts to accelerate the rotor when electrical energy us supplied to it; whereas the generator acts to extract electrical energy from the rotating rotor by decelerating the rotor. This is in accordance with the principle of conservation of energy. As a result of the rotor deceleration, torque is inevitably produced and is typically transferred between the rotor rim and the motor unit via the hub and the shaft. In addition, as the occurrence of input and output events are not concurrent, the combination of the motor and generator into a single functional unit is typically done to the advantages of weight and cost reduction (Hebner et al. 2002). In addition, a low pressure, vacuum environment is maintained via the use of a pressure vessel enclosure, which serves also to support the structural assemblage of the flywheel and bearing system. This vacuum compartment also serves to house all of the rotating components of the flywheel to reduce aerodynamic drag. Other than that, such a compartment is also crucial in protecting the system from catastrophic failure as a consequence of high energy debris. The power electronics on the other hand act as the interface between the motor/ generator unit and that of the electrical power system by converting the input power into a suitable electrical signal for the operations of the motor/ generator unit. Flywheel energy storage devices have the potential to store a higher amount of energy per unit mass than typical chemical batteries. Where design weight is of major concern, and where maximum energy storage is a fundamental necessity, flywheel energy storage systems seem to offer the most appealing capabilities. This is particularly so in space applications where the crucial design weight necessitates the need for a high energy storage capacity in the smallest available size and mass (and thus weight). Other than its high specific energy density, flywheel also possesses superior specific power and when used with magnetic bearings and advanced motor/ generator system, more than 90% of the storage energy can be retrieved, an efficiency far more superior than that if conventional chemical batteries are used where the reclaimed energy constitutes less than 80% of the energy input. In addition, the increment of the amount of energy stored in flywheels can be achieved via the increase of s peed of the rotating rotor while chemical batteries would possibly need some reassembling of the connections from parallel to serial. Flywheels are very effective devices in avoiding unbalanced or oversized design of power systems due to the way they store energy and this is especially crucial in the deliverance of peak power on demand. For instant access to the desired efficiency of energy storage as well as energy required, flywheels repeat the charging and discharging cycle. This process of charging and discharging occurs at a rapid speed as both processes occur in the very same motor/generator. In addition, the flywheel life will not be affected with the large amount of charging and recharging cycles whereas chemical batteries undergoing a similar process will need a replacement after every few years. In addition, flywheel, as a mechanical type of battery, is also tolerant of the extremity of temperatures and as flywheels do not contain acidic and other hazardous material, flywheels are easily handled during manufacturing process, and disposed of at the end of the flywheelsà ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ lif e cycles. Flywheel energy storage systems had since found its way into various applications such as transportation and space satellites, to name a few. In transportation, flywheel systemsà ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ deep recharge and rapid charging capability, the ability to provide high pulses of power as well as the tolerance to a wide operating temperature range as well as the longer operating life on top of weight reduction make flywheel systems an obvious choice in replacing chemical batteries in mobile applications such as electric vehicles. (Hebner et al 2002). A reliable, steady state power quality is of vital importance for critical manufacturing, hospitals, and internet servers. In this context, the flywheel energy storage systems have also found its way into electrical load levelling application such as in ensuring an uninterruptible power supply by providing a smooth and effective transition between a main power source when necessary (Hebner et al 2002) This is one of the current capability of the flywheel and it seems promising that as the technology improves in the near future, flywheel could possibly be applied to peak power managing, where excess energy produced us stored and later released at the peak time in energy consumption. The concept of flywheel is also not novel in the hybrid electric vehicles (HEVs) industry, where small combustion engine is operated while the vehicle is moving at a constant speed. The acceleration process is executed with the extra power provided by the additional battery power supplier. This additional power, on the other hand is generated and stored in the battery when the vehicle brakes such that no additional power is wasted in the form of heat dissipation generated by the friction during brakes. At the present moment, flywheel seems promising in being use for hybrid buses as chemical battery is expensive. In space applications, light weight, compact with high energy density storage capability devices are highly sought after. With increase performance demands on space systems, space programs had had to make consistently huge effort in reducing rim mass to increase payload capacity as well as reduce launch/ fabrication costs. Although chemical batteries had long been a trusted source of energy but flywheel offers much better weight and life benefits as well as the potential to store a larger amount of energy at a lower weight, not to mention the capability to be used as attitude control actuators in replacing reaction flywheel assemblies and control moment gyros. In 2000, Truong et al introduced the Flywheel Energy Storage Demonstration Project, initiated at the NASA Glenn Reasearch Center as a possible replacement for the Battery Energy Storage System on the International Space Station; whereas Fausz et al. had, in the very same year reported that the Flywheel Attitude Control, Energy Transmission and Storage (FACETS) system could combine all or parts of the energy storage, attitude control, and power management and distribution (PMAD) subsystems into a single system, this significantly decreasing flywheel mass (and volume). Thus, in space applications, crucial weight reductions for satellites could, and have hitherto, been achieved with the use of the multi-function high speed flywheel system which not only functions as energy storage but also in providing a gyroscopic effect for attitude control. (Bitterly, 1998, Hebner et al., 2002) But even until recently, the historical development of flywheels and their uses has largely been dependent on advances in both materials and machine technology, coupled with opportunity and necessity (Horner, et al,.1996) However with technological advancements in such a rapid pace, it is not hard to envisage the status of flywheels in the near and distant future. 1.1.3 The Use of Composite and Fiber- Reinforced Materials in Flywheel Design The kinetic energy stored in a flywheel rotor increases linearly with mass but quadratically with rotational speed. . With the increasing demand for high energy storage, flywheels in present applications are often designed for high angular velocities; and these correspond to large centrifugal loads and consequently a higher circumferential and radial stresses, i.e. the dominant stress distribution are hoop stresses (concentric). In this context, the use composite materials with fibers of high unidirectional strength would be desirable. (Shah, 2008) For a fixed axis rotation, the energy stored in a thin rotating ring rotor is [1.3.1] Where I = the rotor moment of inertia ÃÆ' °Ãƒâ€šÃ‚ Ãƒ ¢Ã¢â€š ¬Ã‚ ºÃƒâ€¦Ã‚ ¡ = is the rotor angular velocity. It seems feasible that to increase the stored energy, the mass of the flywheel must be increased and thus its moment of inertia. However, it must be noted that the energy is only linearly proportional to the mass of the flywheel whereas the energy is proportional to the square of the rotational speed. These relations indicate that the rotational speed for a given radius will have a higher influence to the energy density than that of the mass of the flywheel; and to achieve a high rotation speed, a high strength per weight material must be used. Further derivations of the equations below will explain this condition. Resultant force along the hoop and circumferential directions [1.3.2] [1.3.3] Where = force summations in the radial direction = force summations in the circumferential direction dm = mass of the mass element located at radius r rdÃÆ' °Ãƒâ€šÃ‚ Ãƒâ€¦Ã¢â‚¬Å"Æ’ = arc length of the mass element located at radius r ar = radial acceleration of the mass element located at radius r From equation [1.3.3], [1.3.4] With [1.3.5] Where ÃÆ' Ãƒâ€šÃ‚ = mass element density V=mass element velocity B=mass element width Substitute equation [1.3.5] into [1.3.4] and knowing that V=rÃÆ' °Ãƒâ€šÃ‚ Ãƒ ¢Ã¢â€š ¬Ã‚ ºÃƒâ€¦Ã‚ ¡ and for ÃÆ' °Ãƒâ€šÃ‚ Ãƒâ€¦Ã¢â‚¬Å"Æ’ [1.3.6] The tensile stress in the circumferential direction [1.3.7] The stress in a thin- ring rotor is: [1.3.8] It is observed that the maximum speed achievable by a flywheel rotor is limited by the strength of the material from which it is made. The critical speed of the thin ring rotor can be approximated as [1.3.9] Where is the material ultimate strength. From the substitution of equation [1.3.9] into [1.3.1], the specific energy stored in the rim is obtained [1.3.10] K= Flywheel shape factor (Typically 1 for uniform stress disc and 0.5 for thin ring) The dependency of the maximum specific energy stored in the flywheel on the specific strength of the material is thus observed. With the demand for high specific energy in flywheel rotor design, the use of suitable material is thus of paramount importance. Due to their high stiffness to strength, composite materials have successfully been established in flywheel rotor design. Fiber reinforced composites are particularly attractive for use as flywheel materials due to their high strength and low density (Takahashi et al., 2002) The use of composite materials in flywheel designs offer numerous advantages over metallic alloys, including weight and increased strength. This is due to the high tensile strength of the fiber reinforcement phase. In 1986, a composite flywheel rotor was developed by Potter and Medicott for used in vehicle applications. In 1995, the study by Curtiss, et al. shown that the composite Carbon fiber epoxy disc rotor is capable of a 38% higher rim speed or 91% greater rotor energy density than a rotor built of an isotropic high strength to weight ratio Titanium or steel alloys. The carbon fiber reinforced plastic (CFRP) flywheel proposed by Kojima, et al. (1997) shown that high-modulus graphite/epoxy filament wound composite flywheel is able to rotate at a higher speed. The polar woven flywheel by Huang (1999) was shown to possess weight savings features as well as the improvement in life and reliability of the total spacecraft system, and in 2002, the Multi-Direction Composite (MDC) flywheel systems was reported by Gowayed and Flowers. The MDC flywheel system studied employed a new approach to strengthen flywheels with additional reinforcement in the radial direction along with the typical hoop direction reinforcement. In fact, analytical and numerical approaches had over the years been presented to determine the stress, and displacement distribution of the rotor. With the increasing demand for high energy storage, flywheels in present applications are often designed for high angular velocities; and these correspond to large centrifugal loads and consequently a higher circumferential and radial stresses. And the determination of these stresses as well as the ply orientation became especially crucial. As early as 1977, Danfelt et al. published an analytical method for a hybrid multi-rim flywheel with ply-by-ply variation of material properties and based on the assumption of axisymmetry. The method by Danfelt was later extended by Tzeng (1997,2003) which accounts for viscoelasticity effects. In addition, the original method by Danfelt had also been supplemented by a series of researches by Ha with additional consideration of the interference between adjacent rims and varying fiber angles (Ha et al., 1998), the rim radii of numerous material lay- ups for a constant angular velocity (Ha et al. 1999b), residual stresses due to the curing process (Ha et al., 2001) and the subsequent research on a split- type hub (Ha et al., 2006). The effect of rim thicknesses and angular velocity was studied by Arvin and Bakis (2006) while Fabien (2007) studied the optimal continuous variation of fiber angle in a single-material rotor. Other than that, finite element approaches have also been used for stresses and displacement computations which, though computationally more demanding, have gained importance for the analysis and design optimization of flywheel rotors because of the greater modeling depth offer by such methods. It is also possible to assemble the flywheels as a hybrid with rims of different materials in a sequence of increasing ratio of stiffness per density value E/ÃÆ' Ãƒâ€šÃ‚  for increasing radius, r (Arvin Bakis, 2006) using a method called ballasting. From their studies, with circumferential fiber reinforcement, the radial stress distribution is purely tensile with a maximum located approximately in the midplane between the inner and outer radii. But with two-material rotor, the radial stresses turn compressive in the region near the material interface due to the lower stiffness of the inner material which would result in greater expansion. A compressive stress minimum thus exists at the material interface, with two tensile stress maxima found close to the innermost and outermost radius. Despite the increase in circumferential stress level for the outer composite carbon/epoxy rim, such a condition still arises due to the lower radial stresses as a consequent of rotor strength inc rement. After all, composite materials are generally weaker in the transverse direction than in the longitudinal direction. As fiber reinforcement is typically aligned in the circumferential direction, radial tensile stress is often more crucial in comparison with the other mode of stresses due to the weaker strength in this direction. Thus, the dominating stresses are typically those of the circumferential and radial stresses. In this context, much effort had been invested to enhance the efficiency of the composite flywheel rotors by applying stress reduction methods. In view of this method, Danfelt et al. (1997) suggested a sandwich-like rim lay-up with a compliant material between the composite rims of one material to decrease interlaminar stress transmission. 1.2 Literature Review 1.2.1 Interlaminar stresses of Composite Laminates Interlaminar stresses arise when there are discontinuities in the load path, such as free edges and notches. (Wilkins, 1983). In particular, models with a significant amount of curvature. This is because the presence of high interlaminar stresses due to the effect of shell curvature could result in delamination and possibly failure of the laminate at a lower load than that predicted by in-plane failure criteria had they not been properly accounted for. (Edward, K.T., Wilson, R.S. and McLean, S.K. ,1989; Lagace, P.A., 1983) The accurate determination of interlaminar stresses are thus crucial in the design of laminated composite models as the interfacial surfaces of a laminate represent planes of minimum strength (Pagano, N.J. Pipes, R. B., 1973). Classical laminated plate theory (CLPT) was formed in conjunction with the kinetical assumptions of Kirchhoff classical plate theory by assuming a layerwise plane state of stress. However, 2-D CLPT theory alone is not sufficient to explain stress concentration phenomena in various lightweight constructions in aviation vehicle, such as the free-edge effect where full-scale 3-D and singular stress fields occur in the interfaces between two dissimilar layers along the free edges of thermally and/ or mechanically loaded laminates (Mittelstedt Becker, 2003) which decay rapidly with increasing distance from the laminate edge. Such stress localization problems is caused by the discontinuous change of the elastic material properties of the laminate plies at the interfaces and might result in premature failure of the laminate. This is thus an area of concern by designers and much researched has been done since the early 1970s, with the studies initiated by of Pipes and Pagano on the free edg e effects in laminated structures. Early analytic studies were conducted by Hayashi (1967) on edge stress effects consisting of anisotropic plies and adhesive layers transferring interlaminar shear stresses. In early 1970s, Pagano and Pipes also introduced approximation equations for interlaminar normal stresses in the interfaces and was expanded by Conti/ De Paulis in 1985 for the stress- approximation in angle-ply laminates and the calculation of interlaminar stress distribution through the laminate thickness. Whitney simple stress approximations in 1973 did not fulfill the continuity conditions in the interfaces, although Whitney assumption of products of exponential and trigonometric functions did fulfilled the equilibrium conditions and the given traction-free boundary conditions. Researches in the area of free edge effects were also done using various approaches by Tang and Levy (1975) with layerwise series expansion, Hsu and Herakovich (1977) with edge displacement fields in the form of trigonometric and exponential terms, Wang Dickson (1978) with the expansion of the displacement fields into series of Legendre polynomials. However, much discrepancy has been reported. In 1981, series expansions for the stresses in the inner laminate regions and in the vicinity of the free laminate edges by Bar-Yoseph/Pian.CLPT was recovered in the inner laminates with this zero-order approach and unknown parameters obtained by minimizing the laminate complementary potential. The subsequent work by Bar-Joseph used the principle of minimum complementary potential, leading to an eigenvalue problem. The approach used by Bar-Yoseph allowed the continuity of interlaminar stresses in the interfaces as well as the fulfilment of the conditions of traction free surfaces of the laminate. The force balance method by Kassapoglou/Lagace in 1986 and 1987 was developed. Stresses were assumed to consist of layerwise products of in-plane exponential terms and polynomials through the thickness with adjustments done on the thickness terms to satisfy the continuity of all interlaminar stresses in the laminate interfaces and such that they blend into CLPT in the inner laminate regions. Despite its simplicity, the force balance method exhibited good performance even for thick laminates and was thus further explored and refined by other authors. The effects of transverse shear and continuity requirements for both displacements and interlaminar stresses on the composite interface was accounted for by Lu and Liu in developing an Interlaminar Shear Stress Continuity Theory (ISSCT) capable of being used for finite element formulation (Lu, X., Liu, D., 1990). Through that particular theory, interlaminar shear stress could be obtained directly from the constitutive equations. But as the deformation in the thickness direction was neglected during the formulation of the theory, the interlaminar normal stress could not be calculated directly from the constitutive equations. Other than that, a small discrepancy between the results of theirs and that of Pagano elasticity solution in the interlaminar shear stresses small aspect ratios composite laminates was observed (Pagano, N.J. 1969). Although, rigidly bonded laminated composite materials models are always assumed in conventional analysis; but it must be noted that poor bonding and low shear modulus could result in a non-rigid composite interface. As a continuation of the ISSCT, Lu and Liu (1992) later developed the Interlayer Shear Slip Theory (ISST) based on a multilayer approach in investigating the effect of interfacial bonding on the behavior of composite laminates. The Hermite cubic shape functions was used as the interpolation function for composite layer assembly in the thickness direction, and the closed-form solution is obtained for the cases of cylindrical bending of cross-ply laminates with non-rigid interfaces. However, results shown that at some special locations, namely singular points, the transverse shear stress or in-plane normal stress remains insensitive to the condition of interfacial bonding. A closed- form solution was later derived by Lee and Liu (1992) for the complete analysis of interlaminar stresses for both thin and thick composite laminates subjected to sinusoidal distributed loading. The theory was proven to satisfy the continuity of both interlaminar shear stress and interlaminar normal stress at the composite interface and also the interlaminar stresses could be determined directly from the constitutive equations An accurate theory for interlaminar stress analysis should consider the transverse shear effect and continuity requirements for both displacements and interlaminar stresses on the composite interface. It is also advantageous if the formulation is variationally consistent so that it can also be used for finite element formulation. (Kant, T., Swaminathan, 2000) Using the first order shear deformation theory, the interlaminar stresses in laminated composite cylindrical stripes under dynamic loading are studied. Dynamic equations of equilibrium are solved by a combination of Navier approach and a Laplace transform technique. Dynamic magnification factor is calculated for the stresses and deflections for various types of loading and for different values of the geometric parameters. (Bhaskar, K. Varadan, T.K., 1993). Higher order layerwise theorectical framework has been used by Plagianakos and Saravanos (2008) in predicting the static response of thick composite and sandwich composite plates. The displacement field in each discrete layer through the thickness of the laminate include quadratic and cubic polynomial distributions of the in- plane displacements, as well as the linear approximations assumed by linear layerwise theories in addition to the Ritz- type exact solution used to yield the structural response of the thick structure. The formulation has been found to be especially robust in comparison to linear layerwise theory due to the number of discrete layers used to model the thick laminate through thickness and in the prediction of interlmainar shear stresses at the interface. In addition, the theory used also offers a better range of applicability due to the better accuracy offered. Over the years, many papers investigating the effects of interlaminar stresses had been published. The finite difference method with classical elasticity theory was used by Pipes and Pagani for determining the behaviour of finite width laminate in uniform axial strain and where interlaminar stress at the free edge is found to be of a significantly huge amount. Other studies soon ensued such as the perturbation solution techniques by Hsu and Herakovich, the finite difference method using large elements with complex stress field by Rybicki; and Wang and Crossman finite difference method, as well as the approximate analytical solution by Pagano and Wang and Choi. However, all of these studies involve the interlaminar stresses at the free edges of finite composite laminates. It is however, well acknowledged that interlaminar stresses arise such as to satisfy equilibrium at locations with in-plane stress gradients (Saeger, Lagace Dong ,2002), and material discontinuity within a structure is another source of arising in plane stress gradients, and therefore, interlaminar stress appear near the material discontinuities. (Tahani, 2005) Rose/ Herakovich, in 1993, further explore the force balance method of Kassapoglou/Lagace with the introduction of additional terms for the consideration of the discontinuous change of the elastic material properties in the interfaces and which accounted for the local mismatches in Poisson ratio and coefficient of mutual influence between adjacent layers. There are reported improvements in the resultant stress field. However, such improvements are also accompanied with a more demanding computational effort for the minimization of the complementary potential. In a similar study done by Kim/Atluri in 1995, thermal and mechanical loads were analyzed by assumed stress shapes which also accounted for both the local mismatches in Poisson ratio (similar to that of Rose/ Herakvich) and coefficient of mutual influence by applying respective mismatch terms in the stress representations. An approach that agreed to equilibrium demands and the given boundary conditions, the unknown stress functio ns were determined by application of the principle of minimum complementary energy of the laminate. The principle of minimum complementary theory was used by Bhat and Lagace (1994) to evaluate the interlaminar stresses at material discontinuities. In their analytical model, the laminate is formed by the merging of two area

Working at the Restaurant :: Management Business

Leonardo’s Restaurant is located on 7575 Merriman Rd. in Romulus, Michigan. This restaurant is right next to Detroit Metro-Airport, so that tends to bring in a lot of business. Leonardo’s started out as a carry-out restaurant and gradually moved into a sit-down restaurant. After three years of being in front of the complex on 7575 Merriman,, the owner built a new restaurant in the back of the complex. The new restaurant is 8,000 square feet with a bar area and a banquet room, which was not at the old building. Leonardo’s Restaurant has been up and running now for seventeen years and depends mostly on the travelers for its business. Leonardo’s is a family owned business which two brothers share the ownership together. At Leonardo’s it is imperative that every employee does their job and contributes so that the business can run smoothly. The name Romulus comes from the story in Greek mythology of twins â€Å"Romulus and Remus, sons of war, Mars.† The story tells that these boys were being cast out by their uncle being left to die, only to be found and cared by a â€Å"she-wolf† until humans discovered the babies and raised them as their own. The name was chosen due to the population of wolves in this area during the 1800s. Romulus has a population of 23,616, which was recorded in 1996, its city color is green and white, and it is the home of Detroit Metro-Airport. Romulus is home to a wide variety of businesses and industry due to its transportation assets, a strong economy and skilled labor force. When I opened the cherry wood double doors of Leonardo’s Restaurant, I saw to my right the bar area with high chairs outlining the bar. Behind the bar is a huge mirror that stretches across the whole back of the bar. Aliening the mirror is an abundance amount of alcohol lining up across the mirror. To the right of the wall of alcohol is a cappuccino and espresso maker. The bar itself has an evergreen counter top with cherry wood lining across it. When moving into the bar area, I seen that there were booths and tables both an evergreen color with the cherry wood trimming outlining the booths and tables.

Holden Caulfield in The Catcher in the Rye :: essays research papers

Holden Caulfield can be analyzed through his thoughts, actions and circumstances which surround his everyday life. Holden acts like a careless teenager. Holden has been to several prep-schools, all of which he got kicked out of for failing classes. After being kicked out of the latest, Pency Prep, he went off to New York on his own. Holden seems to have a motivation problem which apparently affects his reasoning. The basis of his reasoning comes from his thoughts. Holden thinks the world is full of a bunch of phonies. All his toughs about people he meets are negative. The only good thoughts he has are about his sister Phoebe and his dead brother Alley. Holden, perhaps, wishes that everyone, including himself, should be like his brother and sister. That is to be intelligent, real and loving. Holden’s problem is with his heart. It was broken when his brother died. Now Holden goes around the world as his fake self, wearing his mask. Holden is looking for love, peace and understa nding. He is scared to love because he is afraid he might lose it like he did with his brother. That is the reason for Holden's love of the museum, he feels safe because it never changes it always stays the same. Holden is troubled with the pain of death, it effects every aspect of his life causing him to not care about the future, himself or anyone, except Phoebe and Alley.   Ã‚  Ã‚  Ã‚  Ã‚  The theme of alienation is demonstrated by Holden. He alienates himself from the world because he fears change and false people, he wants love and security. Holden alienates himself from all the changes that occur around him. Holden isolated himself when he didn't go down to the seats for the final football game at Pency. He isolates himself because he gets kicked out of all the schools he goes to. All those changes scare Holden off, he becomes afraid to feel secure. Holden also alienates himself because he trusts no one, he thinks everybody is phony. When Holden was in a bar and he lied and said he had to go, just to not talk to his brothers old girl friend; Holden thought she was annoying and left the bar even though he didn't feel like it. Holden is also alienated by his inability to love. Holden seems not to care about his old girlfriend Sally, he told her he loved her but he didn’t mean it.

Is costumer behavior a quantitative science or qualitativ

United International Business School Main Campus Brussels Prof. White Individual Assignment Student: Martinotta Lara Introduction All of us are consumers. We consume good everyday, we consume and buy products and services according to our needs, preferences and buying power. What we buy, how we buy, where and when we buy, in how much quantity we buy depends on our social and cultural background and our age and family but also on our perception, attitudes, beliefs and values, motivation, personality, and many other factors that are both internal and external to us.All this process is what we call in economics term consumer behaviour. It is important to say that we also consider before buying whether to buy or not to buy and, from which source or sellers. The marketers try to understand the needs of different consumers and having understood different behaviours require they study in their internal and external environment, they formulate their plans for marketing.I will try to develop an interdisciplinary approach of consumer behaviour starting from defining the concept moving to microeconomics methodological study and passing through the behavioural economics highly mphasizing on factors that influence the decision-making process of consumers behaviour I think two summarize more the concepts: â€Å"Customer behaviour reflects the totally of consumer decision with respect to the acquisition, consumption and disposing of goods, services, activities experiences, people and ideas by (human) decision-making†l . Customer behaviour means more than Just the way that a person buys tangible product such as cars.It also included peoples use of services, experiences and activities such as going to the doctor. Microeconomics and Behaviour economics I start with a brief overview of to microeconomics theory, which represents a starting point for examining costumer behaviour. The microeconomics theory makes the assumption that â€Å"Consumer behave rationally and given the chance they will choose the best alternative of with their level of income and preference2† Neoclassical economic coincided with the dominance of the positivist methodological position that judges a theory by its ability to make predictions that are supported by the evidence.In Microeconomics † the individual firm rationally maximizes profit through purchase decision†3. n sum the microeconomics theory balances tour elements tn consumer's available income, the price of the goods, the consumer's tastes or preferences, and the assumption of utility maximization. In such models, utility can best be thought of as levels of satisfaction, happiness or personal benefit. By using the assumption that individuals act in order to maximize personal subjective benefits, economists make costumer behaviour analyse quite simple as they â€Å"apply powerful mathematical techniques for modelling behaviour outcomes4†.The Microeconomics model of costumer behaviour often corr espond to how costumer ehave however clear and voluminous evidence from psychology has shown that the rationality assumption of standards economics are wrong. Evidence from psychology has shown that we often are irrational. â€Å"This selfish maximization principle of Homo economicus limits the application of neoclassical economics to other areas†5 Recognition of these difficulties had led to a series of new approaches to modelling the individual behaviour, mostly based on challenges to the assumption of neoclassical economics.At the end of the 20th century the strict neoclassical position came under attack from many different directions. Some of these merely suggested more complex objectives and constraints, while others took economics is new directions by putting an emphasis on uncertainty and risk†6. Simon argued that human behaviour is best modelled as aspiration-based, rather than as optimizing behaviour. In his view is important to achieve aspiration levels with s atisfactory outcomes indicating that â€Å"satisfy' behaviour is normal and optimizing behaviour is abnormal.

Laurie Halse Anderson Essay

As Cayla Mills once said, You never know whole you be until creation bullocky is the still superior you have. People in books, movies, and steady in satisfying- spirit dont know their certain stance until macrocosm strong is the only option they have. People will even become stronger and will march their military unit by facing tough decisions and by dealing with their problems. Characters in books a good deal test their truthful forte by overcoming obstacles in life. Throughout the books spill by Laurie Halse Anderson and The utterly true(p) Diary of a parttime Indian by Sherman Alexie, characters demonstrate their potency by facing their problems. It is when they learn to mouth up for themselves that they find their true loudness and become even stronger than they were before. In the paper Speak by Laurie Halse Anderson, Melinda discovers her true power through her problems with bullying.During the party over the summer, Melinda was ransacked and had n ot been able to speak up for herself. After the rifle, she called the cops on the guy who had attack her. People had not hardened her fairly because they thought she was strange for calling the cops at the party. She had not been able to itemize anybody just about what had really happened. Throughout the story, Melinda suffers to speak to other people. Since the story is told in premier-person, the reader raise insure the situations Melinda has suffered through. They feel her pain when Rachel walks up to her during the first day and regularises to her, I hate you. They also understand her difficulties with speaking up for herself. During the beginning, there are often conversations involving Melinda without her manifestation a word. When she decides to speak up for herself in the spring, she discovers her true strength and is able to tell Rachel, her ex-best fri decision, about the rape. Also, because Laurie Halse Anderson used symbolism effectively throughout the nove l, the reader is able to understand Melinda in relation to a tree. identical to a tree, Melinda hibernates in the winter and goes dormant, only shoots the strength the speak up for herself in the spring. Another example from the story Speak is when Melinda has to hold dear herself from Andy Evans. When she is attacked once again by Andy Evans in the janitors closet toward the revoke of the book, she is given cardinal options to let Andy Evans gain control of her and possibly rape her a second time, or to guard herself against Andy Evans, contempt her fear. She chooses to stand up against Andy Evans and gains the courage to formulate no to him, which is what she wasnt able to say during the rape at the party. Whenhe assaults her further, she grabs a piece of the broken mirror and uses it to misemploy Andy Evans, disabling his speaking ability. During the entire first marking period, she tried to hide from mirrors so that she cant look at herself. When she used the broken mir ror to defend herself, it showed that she had the strength to front herself and to see that the rape had not been her fault.Through this decision she has demonstrate her true strength, and shows that she finally has the strength to protect herself from Andy Evans. Throughout the book The Absolutely True Diary of a Part-Time Indian by Sherman Alexie, Arnold must face some(prenominal) his problems at home and his problems at direct in Reardan. At the beginning of the book, Arnold is interact poorly by the Indians on the rez for being bold complete to leave the rez and to go to Reardan. Arnold is also treated unfairly by the w causee people at Reardan for being the only Indian at the school. Toward the end of the book, however, Arnold gains the strength to start making natural friends at Reardan. Even when his grandmother is, ironically, hit by a drunk number one wood and killed, he is able to demonstrate the strength he has gained from these new friends and from the hard pref erences he has made.At the beginning of the book, Arnold is faced with two options to either stay on the rez and face his drunken father along with the ministration of the drunken Indians, or leave the rez to go to Reardan. It would have been easier to stay on the rez, penetrative that he would not be treated the same by the Indians subsequently leaving, tho he chose to go to Reardan. Arnold was bold enough to leave the rez to go to Reardan, where he had clear-cut that he would be able to draw in a better education. Arnold is certainly not treated the same by the Indians after leaving, nor is he treated fairly by the students at Reardan.On the rez, he is frequently called an apple, meaning that he is white on the inside on red on the outside. By facing his problems head on, he is able to demonstrate true strength and is ultimately able to gain the consider of many students at Reardan. Cayla Mills once said, You never know how strong you are until being strong is the only choi ce you have. The quote describes how you never know how strong you really are, until the times in life that you must be strong. By facing ones problems, it is possible to demonstrate true strength. In many real life situations and in books, the strongest characters find their true strength through suffering and often dont know how strong they are until faced with difficult decisions.

The Financial Performance Measures Accounting Essay

During the exist old ages, much than and more attention is p assistance to the incentive construction of chief operating military incumbents of elephantine multinationals. chief executive director director officer bon wonts has become an international liberate debated in the parliament and routinely have in front-page headlines, screen narratives, and telecasting wisdom shows. Several factors have contributed to the widespread interestingness in chief executive officer fillips. First, the salary of CEO has risen aggressively during the last decennaries ( Murphy, 1999 ) . Secondly, rough floors in the Netherlands were in existent chore during the mo meshary crisis, they essential financial aid from the authorities, but their CEOs tacit got a fillip ( Hooft van Huysduynen, 2011 ) . But since the regulations intimately CEO allowance were wholly ill-defined for companies which needed monetary aid from the authorities, more arguments were held in the authoriti es and regulations were changed often. This contributed to the widespread involvement of the subject atomic number 18a of executive compensation in The Netherlands ( de Horde, 2011 ) . And in conclusion, there has as well been an detonation in academic research on executive compensation, which contributed to the rosen involvement of CEO bonus-structure ( Murphy, 1999 ) .CEO compensationThe compensation bundles negotiated with primary(prenominal) executive officers ( CEOs ) of big corporations largely contains quaternary basic constituents a base wage, an yearly fillip tied to business relationship state-supported presentment, tune options, and long term incentive programs ( including restricted stock programs and multi-year invoice-based earthly aid manifestation programs ) ( Murphy, 1999 ) . The incentive constituent frequently is comprised of twain an one-year fillip program and a long-run inducing program, where the final payments from these programs number on an intricate portfolio of worldly concern demonstration start ( Bushman et al, 1996 ) . The compensation commission peck take divergent humanity foundation stairs, including stock give in, accounting communicate and non-financial pure tone, to get word how much of each signifier of compensation the CEO exiting gain ( Krolick, 2005 ) . give CEOs based on short bring accounting winnings incomes provides inducements to enlarge short mesh incomes ( by, for illustration, cutting R & A D ) even if making so reduces nurture in the long t on the wholey. Conceptually, the faultless semi existence first appearance yard for a CEO is the Chief executive officer s personal part to the value of the house. This part includes the consequence that the CEO has on the humankind entry of some others in the organisation, and besides the effectuate that the CEO s actions this class have on public unveiling in incoming periods. Unfortunately, the CEO s part to tighten value is about neer straight mensurable the on tap(predicate) locomote forget necessarily buy food ways that the CEO creates value, and include the effects of factors non due to the attempts of the CEO, or neglect to divulge ways that the CEO destroys value ( Murphy, 2013 ) .A long line of literature has argued that compensation should be related to public presentation. The crusade for the linkage ar both prescriptive and dictatorial. In a normative sense, compensation is considered just if it has been authoriseed through victor public presentation. In a autocratic sense, bureau theoreticians argue that associating compensation to tauten public presentation locomote provides inducement to increase steadfast value ( Balsam, 2002 Lewellen and Huntsman, 1970 Murphy, 1985 ) .Fiscal public presentation moveFiscal public presentation travel consists of mensurations of hard currency flow, net income, earnings-per-sh ar, vernacular revenues, economic value added, repos sess on invested detonating device, return on assets, return on equity, return on gross revenues, stock monetary value return and cost decrease ( Ittner et al, 1997 ) . The literature paperss that i?nancial accounting steps, particularly steps of proi?t dexterity, ar extensively utilize in executive compensation contracts. There is dirts of widespread, evince use of proi?tability steps in the one-year fillip programs and in the long-run public presentation programs of bodily executives. The inexplicit example of proi?tability steps in the board of theatre director s rating and compensation of vivid elevation oi?cers is supported by a robust, unconditional statistical relation between proi?tability steps and assorted steps of executive wage, including managerial turnoer chances ( Bushman and Smith, 2001 ) . The most of import end of utilizing financial public presentation steps alternatively of utilizing nonfinancial steps, is that fiscal mark are cheaper and easier to mensurate, since all companies are already compulsory to print a proportion sheet and an income statement ( Epstein, 2006 ) .Paul ( 1992 ) shows that stock monetary value need non render efficient inducements in a multi-task aspect because monetary value gaining controls the value of the house instead than the value-added by the director. Ittner et Al ( 1997 ) argues that fiscal steps entirely may non attribute out the most efficient agencies to actuate directors to move in the mode desired by the house s proprietors. While companies use a assortment of fiscal and non-financial public presentation steps in their one-year CEO fillip programs, about all companies rely on some step of accounting net income much(prenominal) as net income, pre-tax income, or operating net income. Accounting net income measured over short intervals is non, nevertheless, a peculiarly penny-pinching step of the CEOs part to tauten value, for some(prenominal) grounds. First, CEOs routinely make dete rminations ( such as sequence planning or R & A D investings ) that provide increase long-term value but non short-term net income. Second, accounting net incomes ( care equity-based steps ) are constantly influenced by factors outside of the control of the CEO, including the effects of concern rhythms, universe oil monetary values, natural catastrophes, terrorist onslaughts, etc. Third, while the steps of accounting net incomes typically used in fillip programs take into history both grosss and disbursals, they ignore the chance cost of the capital employed. The physical exercise of these accounting steps provides inducements to put in any undertaking that earns positive accounting net incomes ( non merely those that earn more than the cost of capital ) , and provides no inducements to abandon undertakings gaining positive accounting net incomes that are less than those needed to covering their cost of capital ( Murphy, 2013 ) .Non-financial public presentation stepsNon-financ ial public presentation steps consists of steps of employee gratification, merchandise or service quality, readiness or productiveness, employee safety, market portion, non-financial strategic aims, turn betterments and re-engineering, new merchandise development, invention, employee development and preparation, pee force diverseness, leading and client contentment ( Ittner et al, 1997 ) . Recent grounds indicates that i?rms are progressively utilizing non-i?nancial public presentation steps such as client satisfaction and merchandise quality in the hereditary procedure within i?rms ( Ittner et al, 1997 ) . prior literature shows that noni?nancial public presentation burn counterbalance for noise and end incongruence of i?nancial public presentation steps. Another plummy undertaking property of noni?nancial steps is their ability to foretell future public presentation and to ease intertemporal fiting between current investings and future returns ( Matejka et al. , 2009 ) . Non-financial public presentation steps are assumed to ease the board s appraisal of private managerial data so it can more almost supervise the executive decision-making procedure ( Schiehll and Bellavance, 2009 ) . The ground for the usage of non-financial steps in compensation contracts is that they provide information incremental to accounting steps in rewarding and motif directors ( Davila and Venkatachalam, 2004 ) .Fiscal CrisisPearson and Clair ( 1998 ) positive a definition for organisational crisis An organisational crisis is a low-probability, high- furbish up event that threatens the viability of the organisation and is characterized by equivocalness of cause, consequence, and agencies of declaration, every bit good as by a belief that determinations mustiness be made fleetly. Several illustrations of organisational crisis are Extortion, Bribery, Hostile coup detat, Information sabotage, Terrorist onslaught, executive director kidnaping, Product callback, Na tural catastrophe that destroys corporate central offices ( Pearson and Clair, 1998 ) .The fiscal crisis started in phratry 2008. Assorted causes of the i?nancial crisis have been cited, including deliberate ordinance over mortgage loaning, a turning lodging bubble, the rise of derived functions instruments such as collateralized debt duties, and questionable banking patterns ( Kothari and Lester, 2012 ) . This research is concentrating on this fiscal crisis, which started in September 2008, and is still go oning at the minute of penning this thesis.Ittner et Al. ( 1997 ) argues that as the noise in fiscal steps increases, houses tend to put more weight on non-financial steps. At the other side, Matejka et Al. ( 2009 ) i?nd that proi?t fate and i?nancial hurt ( which make i?nancial public presentation steps more congruent with i?rm ends ) are associated with a lower accent on noni?nancial public presentation steps.Hypothesis developmentAlthough old literature us non consistent t he usage of non-financial public presentation steps in times of fiscal crisis, more recent research ( Matejka et al. , 2009 ) leads to the infix that the usage of non-financial public presentation steps in CEO fillip contracts will drop during the current fiscal crisis. base on this premise, the following hypothesis is developedHypothesis 1 The usage of non-financial public presentation steps in CEO fillip contracts has been decreased from 2005 to 2010, due to the impact of the fiscal crisis.III. MethodologyThis subdivision describes the research methods used to look into the empirical association between the fiscal crisis and the usage of non-financial public presentation steps.SampleA mark standard of 27 houses is identified from Dutch companies listed on the Amsterdam Exchange Index ( AEX ) at the beginning of the twelvemonth 2013. No specialization is made between different sectors, all AEX-listed companies were taken in the sample.Data accruementData was collected from proxy statements in one-year studies in two different old ages. To mensurate the consequence of the fiscal crisis, the first twelvemonth which had been measured is 2005, since during 2005 no influence of the fiscal crisis could be perceived. The second twelvemonth which is used to roll up informations, is the twelvemonth 2010. 2010 has been chosen because it was in the eye of the fiscal crisis and all informations is now lendable from this twelvemonth. This research surveies the comparative weights placed on fiscal and non-financial public presentation steps in main executive officer ( CEO ) fillip contracts ( Ittner et al, 1997 ) . This method is alike to the method adopted by Ittner et Al ( 1997 ) and used by Schiehll and Bellavance ( 2009 ) .VariablesThe empirical metaphysical account of this research will be as followY = I + I?1Xi +I?2XiWhere Y will incorporate the dependant variable usage of non-financial public presentation steps, I?1 will stand for the state of personal matte rs of the usage of a non-financial public presentation step in 2005 ( 0 will stand for the usage of a fiscal public presentation step in 2005, and 1 will stand for the usage of a non-financial public presentation step in 2005 ) , I?2 will stand for the state of affairs of the usage of a non-financial public presentation step in 2010 ( 0 will stand for the usage of a fiscal public presentation step in 2010, and 1 will stand for the usage of a non-financial public presentation step in 2010 ) , and Xi contains the house.