Internal and External Audit Preparation
An external audit focuses on identifying trends and events beyond the control of an organization that can affect its operations, management, and strategies. Factors might include foreign competition, population shifts, changing demographic trends, etc. An external audit identifies key opportunities and threats so that strategies can be formulated to address them. You began this process with your SWOT analysis in Activity 2. External information needs to be combined with an internal audit in order for strategies to be perceived and developed. After reviewing the course reading, prepare the following internal and external audit items for your organization that includes:
- A financial ratio analysis; highlight especially good and bad ratios
- Describe the organizational chart; note any compelling features such as demographic composition or transitional trends
- A Competitive Profile Matrix

Be sure to include citations in proper APA format in the body of your paper; add to your master bibliography as necessary to reflect your research for this assignment. Submit your 2-4 page document in the course work area.

Learning Outcomes: (3, 4, 5)

Activity Outcomes

* Synthesize the key points of internal and external audits to prioritize strengths, weaknesses, opportunities and threats of an organization.
* Evaluate important behavioral, political, ethical, and social responsibility considerations in strategy analysis and choice.
* Critique and evaluate financial information in the stage of strategic formulation.

There are faxes for this order.

Business Research Methods
There is a topic which is to be researched. The central research question is: 'How internal audit can improve social media risk management in financial institutions?'. From this main research question, the following research objectives can be broken down: (a) Define social media risk, (b) Determine how internal audit can identify social media risk, and (c) Identify how internal audit can mitigate social media risk.
Requirements:
(1) Conduct a Literature Review in the research topic/question outlined above ? about 800 words. Literature Review must be properly referenced using Harvard Referencing Method.
(2) Research plan: Answer the following questions in relation to the best suited research type/approach/method/etc to this specific research:
(i) Research type: Quantitative research, qualitative research or mixed methods research? Why?
(ii) Paradigm: What is an appropriate philosophical approach? Why?
(iii) Research approach: What is the research approach (inductive or deductive)? Why?
(iv) Research nature: What is the nature of the research (exploratory, explanatory, descriptive)? Why?
(v) Research strategy: What is the most appropriate strategy/strategies to use (experiment, survey, archival research, case study, ethnography, action research, grounded theory, narrative inquiry)? Why?
(vi) Hypotheses: If quantitative research, try to formulate the null and the alternative hypotheses.
(vii) Research methods: one method to collect data or multiple? Which one/s? Why?
(viii) Research techniques: What are some appropriate research techniques according to the general research design? Why?
(ix) Sampling: What methods to use in order to select the sample? How would the representativeness of the sample be judged?
(x) Time frame: Is the research cross-sectional or longitudinal? What would be different if chosen the other time approach?
(xi) Ethical/Accessibility issues: Are there any ethical considerations? Is approval needed from ethical committees? How easy is to access the elements of the research (data, organisations, people)?
(xii) Limitations/ Further research: Are there any limitations? Any areas that future research can be based upon?

NOTE: References only for requirement (1) the Literature Review.
USEFUL BOOK: Research Methods For Business Students. Mark Saunders, Philip Lewis & Adrian Thornhill. 6th ed. 2012, Pearson.
INTERESTING ARTICLES:
- WSJ - social media risk + expanded role of internal audit
- the iia org - auditing social media risks for financial institutions

I am Requesting Writer: jowriter63 OR FLWriter2011

PAPER SPECIFICATIONS:
Below are Four (4) questions, and I am requesting Two (2) pages per question.
VERY IMPORTANT: The paper MUST show DEPTH and FOCUS to show your understanding of the questions
There are no number of restrictions on the source of references but reference MUST come from reputable sources.

INSTRUCTION:
The real corporation/company world and the textbook world do not always relate to one another, so using your auditing course knowledge, answer the following questions:

1) Discuss about the difficulties of establishing good internal auditing practices in a company?

2) How would you establish an auditing department and what interfaces would be required into the corporate infrastructure?

3) How would you implement policies that dictate what responsibilities that would be required, including standards or internal company polices

4) How would you monitor the implementation of your selected polices to verify that they are active and applied.

How to insure effective internal controls with SOX, Corporate Governance, IFRS, Internal Audit, Risk Management, etc. to avoid what's happened in Enron?

The paper is about The Pros and Cons of Outsourcing Internal Audit Services by Companies. The paper should make appropriate use of more recent articles in leading accounting/business publications. Papers must be broken down by sections and have an introduction, summary/conclusion, and references. Papers will be graded based on readability, selection and use of source material, interest, and quality/quantity. Excessive use of listing or any specific source is not acceptable. References must come from recently published items (periodicals, relevant news sources). Books, especially text books, should not be used as references. Web-based sources (Google for instance) should not be considered a good source for material. References included in your list should provide a major source for the paper, and acknowledged in the body of the paper where appropriate. Papers should reflect good style for margins, quotes, cites, and section headings. Lists (such as steps in a process) will not be acceptable. The same thing can be said for overuse of tables/diagrams/charts taken from references. All sources must be very recent, if you have a question about whether a source is acceptable please contact me.

"AC562 Auditing:Oper & Intrnal Persp"

CASE STUDY: COVER STORY: INTERNAL FRAUD 2

Sometimes fraud is discovered by chance instead of deliberate effort. In the $4 million embezzlement fraud by an employee of a magazine publisher, more than one coincidence brought down the perpetrator.
A popular magazine and large direct-mail publishing house decided to outsource much of its direct-mail operations to specialized mail vendors. The company began converting its plant in Pleasantville, New York, from a direct-mail-order factory to an office complex. Part of the office complex construction involved building an auditorium that was to be identical to another auditorium in historic Williamsburg, Virginia. Terrence McGrane had just begun his third day on the job as chief internal auditor. In an effort to get to know his new company, he had scheduled a series of interviews with all the vice presidents. His first interview was with the vice president of administrative services, Harold J. Scott, who was in charge of many construction projects and maintenance services. Because of the massive renovation project, it was not unusual for hundreds of invoices to be forwarded to Scott.
Coincidence one: McGrane stopped by the accounts payable department and retrieved a series of recently submitted invoices for various trade expenses related to the auditorium construction project. ?One of the things I wanted to accomplish was to understand how the accounting codes worked?what was capitalized; what was expensed; how it was recorded, etc.? So he grabbed a stack of processed invoices with accounting codes and went up to the construction site to meet with the vice president for an hour-long interview.
As the two walked around the grounds, McGrane asked the vice president if he could explain the accounting codes to him: ?He stared at the [top] invoice for approximately 30 seconds and said: ?That is not my signature on the invoice!?
As he looked through the stack, he found what appeared to be about three or four other forgeries. He was completely baffled.?
The initial investigation revealed that all of the forgeries were in the painting division, budgeted at approximately $500,000 a year. The company employed only one person to oversee the painting operations in its facilities department: Albert Miano.
Miano, a 35-year-old from New Fairfield, Connecticut, earned about $30,000 a year. It was his job to coordinate time-and-materials contracts with the scores of painters, carpenters, electricians, and plumbers who toiled daily on the renovation, repair, and construction of the building complex. As facilities supervisor, Miano regularly forwarded invoices to the vice president of administration services for approval.
Miano launched his scheme by crafting false invoices for the jobs done by the painters. He took a copy of a trade invoice from an existing painting contractor and, using his home computer, created a replica into which he would record slightly different hours for the trade contractors? work.
McGrane related a probable scenario of how Miano executed his scheme. ?Let?s say he knew that during the month of February, as an example,? McGrane said, ?there were twenty-seven painters on the grounds during the course of one week.? Miano also knew the total number of hours and the volume of materials used in that time. ?He would create invoices that were similar in nature, but record only eleven painters on the grounds,? McGrane said. Miano would not reinvoice exactly the same work done during a week, but he would make it look so similar that no one?s suspicions were ever aroused. Effectively, there were no work orders on the ?phantom work? he created on these invoices. Miano always listed fewer painters on the false invoice than the actual number who had worked that week, and he registered less time for their services than they had actually worked.
As part of his job, he regularly brought the trade invoices into the administrative VP?s office for signature approval. After delivering a stack of these invoices, he would return to collect them within the next day or two and deliver the approved invoices to the accounts payable department. ?It was this opportunity,? McGrane said, ?that this individual was allowed to go and collect the approved invoices and insert his own replicated fraudulent invoices as approved. This was the first piece of an ?electronic circuit? that allowed him to commit the fraud.? The second piece of the circuit for the fraud to ignite, McGrane said, was allowing this same employee to transport the invoices to the accounts payable department, and ultimately to collect the check.
After seeing how easy it was to slip in his own false invoices in the stack of approved ones, Miano became bolder in his scheme. He began calling accounts payable, claiming that a carpenter or painter had arrived on the grounds and needed his check ?immediately.? To keep the project flowing, the employees in the accounts payable department accommodated him. Many employees knew and liked Miano, who had worked for the company for nearly 15 years.
Eventually, this routine became so familiar to employees in accounts payable that Miano did not even need to make up an excuse to pick up checks. Each time he would collect them, he stashed the check for the false invoice in his pocket. When he returned home to New Fairfield, Connecticut, he took the check to his bank, forged the contractor?s name on the back, then endorsed it with his own name and deposited the check.
McGrane explains that Miano was able to pull off the scam due to failure of internal controls and employees not following standard accounting procedures. ?For any business transaction, the invoices should be dispatched independently to the approving authority. Once signed, the approved invoices should be sent independently to accounts payable. When the check is prepared by accounts payable, they should mail it directly to the third party. Under a strong internal control system, the employees and/or contractors should not be allowed to come in and collect checks directly. Direct contacts with accounts payable personnel make it too tempting for someone to try to misappropriate funds.?
Accounts payable also failed to combine the invoices into a single check?they wrote a check for each invoice. ?Had they combined it,? McGrane said, ?his false invoice would have been added into the legitimate painter?s monthly invoice summary, and the money would be mailed to the legitimate contractor,? McGrane said. Accounts payable neglected to study the invoice signatures for forgeries, and the accounting department dropped the ball by not perusing processed checks for dual endorsements, another red flag for potentially misappropriated funds.
Miano?s first transaction totaled $1,200. His second transaction jumped to $6,000?his third, $12,000. His largest single transaction came to over $66,000. Miano refined his strategy by pacing, on a parallel basis, a certain amount below the total due the painter. ?If the painter submitted an invoice for $20,000 a month,? McGrane said, ?Miano would submit an invoice for, say, $14,000. If the painter submitted a $6,000 invoice, he?d submit one for $3,000.? The individual invoice amounts, because of the continuing construction, would not have alarmed even an auditor.
Miano?s behavior at the office was the same as ever. He dressed the same way, drove the same car to work, and shared little of his private life with other workers. He had not taken a vacation in over four years, and his boss thought he should be promoted (a move Miano resisted, for reasons now obvious). After hours, however, Miano was a different person.
Coincidence two: McGrane?s secretary was not only on Miano?s bowling team, she was also his neighbor. They saw each other regularly at the local bowling alley. She took notice when Miano?s behavior became somewhat extravagant. At first he took to buying the team drinks, a habit most appreciated by his teammates. However, the secretary began wondering where all the money was coming from when he showed up in his new Mercedes (one of five cars he bought) and talked about a new $18,000 boat. He also invested in real estate and purchased a second home costing $416,000.
McGrane?s secretary approached Miano one night after he had spent some $800 on drinks for the team. ?Did you win the lottery, or what?? she asked. He explained that his father-in-law had recently died and left a substantial inheritance to his wife and him. Miano?s father-in-law was actually quite alive, but no one ever bothered to check out the claim. No one suspected Miano of doing anything sinister or criminal. All of his associates considered him ?too dumb? to carry out such a scheme. One person described him as ?dumb as a box of rocks.?
Coincidence three: After four years without a vacation, Miano took what he considered a well-deserved trip to Atlantic City. But he wasn?t there long before he was called back to Pleasantville. One can imagine his chagrin at having to leave the casinos and boardwalks and head back to the office. Little did he know that things were about to get a lot worse.
Upon his return, Miano found himself confronted by the auditor, the vice president, and two attorneys from the district attorney?s office. He readily admitted guilt. ?He said he had expected to get caught,? McGrane said. ?He did it strictly based on greed. Miano claimed there was no one else involved, and the sum total of his fraud was about $400,000.? But the internal audit found that Miano had forged endorsements on more than fifty checks in those four years, totaling $1,057,000. Ironically, the auditors could only identify about $380,000 spent on tangible items (boats, cars, down payment on a home, etc.). The investigators could not account for the other $700,000, although they knew Miano had withdrawn at least that much from the bank.
Miano served only two years of an eight-year sentence in a state penitentiary. At the time of his indictment, his wife filed for divorce, claiming she knew nothing of her husband?s crimes. Miano told a reporter in jail that the loss of his family and the public humiliation had taught him his lesson.
?For a nickel or for $5 million, it doesn?t pay,? Miano said. ?You enjoy the money for a while, but you lose your pride and your self-respect. It ends up hurting your family, and no money can ever change that.?

REQUIREMENT:
Discuss the coincidences involved in this case study. Use the 2009 Global Fraud Survey for references concerning perpetrator, size of fraud, detection, and controls.

Donald Reynolds, director of the internal auditing department, received an anonymous tip from an employee in one of the high tech manufacturing plants. The employee noted that there was a major embezzlement taking place in one of the divisions. Internal audit had completed a routine review of internal control of that division the previous year and found that the control system was properly designed and operating effectively. Only minor recommendations were made, and the next review is due 3 years later.

The employee noted the erratic behavior and lavish lifestyle of the plant controller and stated that the controller has been overriding existing controls, which would prevent any audit from being able to detect the embezzlement. The plant controller is well-respected and highly trusted by the CEO and CFO, and their families are involved in the same civic and religious organizations. Investigating the plant controller could cause considerable disruption in the company and the personal lives of the employees.

Please answer the following questions. As you answer each question, you must provide support or evidence that will enhance and empirically prove your answers. Academic criminal justice articles or real life criminal justice findings that are not found in journals or other academic sources must be used in supporting your answers. Please use APA style for all cited sources including your resource page.

Given the situation, discuss some of the options the company has for handling this situation.
Assuming you decide to investigate these allegations, describe the investigation steps.
In preparation for the interviews, note the order of the witnesses who would be interviewed and how you would plan, conduct, and document your interviews.
Discuss how you would conduct an admission-seeking interview of the plant controller.
Please submit your assignment.

Requirements:

-Use the perspective of a consulting team (no first person). Pretend that your audience is the CEO or Board of Directors. Thus, your audience is familiar with all the facts of the case; do not waste time restating case data. Your objective is to analyze, interpret, draw conclusions, make recommendations and projections that are unique, and must be explained and justified.
-Your report should be well organized, succinct, and well written. The report should read as a unified piece of work and flow smoothly.
-one inch margins, times new roman - 12 pt font
-use headings appropriately
-number pages
-title page and TABLE OF CONTENTS

I am going to upload the outline details and the case study (Southwest airlines).

I have an idea on how the table of contents would look like, but it does not have to be the same.
TABLE OF CONTENTS:

-report introduction
-company introduction
-situation analysis
-strategic objectives and goals
-industry analysis
-SWOT analysis
-financials
-internal audit of firm's resources
-analysis of the firm
-competitive advantages/ distinctive competencies
-identification of strategic issues
-priority issue/ opportunity
-strategic alternatives
-recommendations

Thanks.

Question

Internal audit is recognised as an important component of corporate governance serving as a resource to audit committees, management and external auditors.

External auditors can use the work of a client?s internal auditors when the latter is considered effective.

The International Auditing and Assurance Standard Board (IAASB) issued an exposure draft (ED) in 2010, titled ?IAASB Proposed International Standards on Auditing ISA 315 (Revised), Identifying and Assessing the Risk of Material Misstatement through Understanding the Entity and Its Environment, and ISA 610 (Revised), Using the Work of Internal Auditors?.

Required

Based on a review of relevant literature on the issues covered in the ED, write an essay on key issues involved in external auditor?s reliance on internal audit work. Your essay should:

a. Discuss major issues raised in IAASB?s latest ED on ISA 610 (Revised)

b. Evaluate the changes proposed in the ED to ISA 610 (Revised).


c. Explain conditions under which an internal audit function is considered effective.

d. Discuss the difficulties internal auditors may face in conducting their duties.


e. In view of the global financial crisis of 2007 ? 2010 or other recent corporate collapses in Australia and overseas, discuss how cooperation between internal and external audit could enhance external audit efficiency and effectiveness?

? Do you believe external auditors could undertake a more effective business risk approach to auditing via increased reliance on internal audit work?

? In your opinion, is the coordination between internal and external auditors likely to increase in the future? Why and Why not?


Some useful web links:

http://www.ifac.org/Guidance/EXD-Details.php?EDID=0141

http://www.globalissues.org/article/768/global-financial-crisis

http://www.ifac.org/Guidance/EXD-Details.php?EDID=0143

http://www.cfo.com/article.cfm/9349986/c_9350413?f=home_todayinfinance

http://www.business.illinois.edu/kpmg-uiuccases/monograph.PDF

http://www.qfinance.com/corporate-governance-viewpoints/lessons-from-the-credit-crisis-governing-financial-institutions?full

This is the proposal that was approved by my professor. Please write it to match the 3 main topics in the proposal, public accounting careers, corporate accounting careers, and governmental accounting careers.

Authorization and Background

Career options available to entry level accounting graduates include public accounting, corporate accounting, and governmental accounting. These vocational options are each divided into more specialized areas of practice. This research proposal seeks authorization to conduct in depth research into the aforestated areas of accounting as they relate to career selection.

Intended Audience

Identifying the audience will make the writing process simpler because the purpose and style of the research will conform to the standards required by the audience. With this research proposal focusing on a significant personal decision, the primary audience for this research project will be Professor Seguin in her position of instructor to the researcher and writer.

Defining the Problem and Purpose of the Research

Accounting seniors and recent graduates may possess theoretical knowledge of accounting theory, but often know little to nothing regarding the careers available to them upon graduation. In order to make a competent decision about which career to pursue, the available options should be scrutinized. Conducting research into each area of professional practice is necessary to eliminate confusion regarding the professional variation in accounting positions. This research will endeavor to answer the question: What are the professional differences in working in the fields of public accounting, corporate accounting, and governmental accounting.

Scope of Research

The scope of research will include three major headings which are public accounting, managerial accounting, and governmental accounting. Each major category will be subdivided as follows:

Public accounting

Taxation Services

Assurance and Audit Services

Advisory Services

Corporate accounting

Cost accounting

Controllership function

Internal auditing

Governmental accounting

Budgeting

Criminal Investigation

Auditing

Limitations and Delimitations

It is planned to interview accounting professionals about how they began their career and their job functions. It is probable that their cooperation will be limited if they are busy or view being interviewed as a nuisance. The length of the time necessary to conduct the research is limited and thus the deadline is another limitation. A major delimitation relates to the scope of research being undertaken. The research will be limited to three major career fields in accounting.

Data Collection and Analysis

Data will be collected from a variety of sources including personal interviews, web sites, books, and journal articles. The data collected will be analyzed qualitatively.

Works Cited

American Institute of Certified Public Accountants. Web. 27 Sept. 2009. .

Gaylord, Gloria L. Careers in accounting. New York: McGraw-Hill, 2006. Print.

IMA - Institute of Management Accountants. Web. 27 Sept. 2009. .

The Institute of Internal Auditors (IIA) - Welcome - The Institute of Internal Auditors. Web. 27 Sept. 2009. .

Prendergrast, Mark. "Sole proprietor, CPA." Personal interview.

Time Schedule

October 25th a progress report will be submitted in the form of a PowerPoint slideshow. This progress report will demonstrate the depth of research conducted and the progression of the project.

November 22nd the project is scheduled for completion and will be submitted for a final grade.

Resources Needed

The Supplies needed to conduct research on the proposed topic include a travel allowance to drive to the library and to Kent State University. The accountants to be interviewed will be provided at the Beta Alpha Psi meetings held every Thursday. Microsoft Word, having already been acquired, will be utilized to write and edit the research paper.

Request for Approval

I hope that I have provided you with sufficient information to make an approval decision on the proposed topic. I seek your approval to continue with this line of research. Please email me at [email protected] with your decision.
There are faxes for this order.

AC562 Audit, Assignment
Overview
Background: Corporate governance is defined as the system by which companies are directed and controlled. Sound corporate governance is an important element of sustainable private sector development - not only because it strengthens businesses? ability to attract investment and grow, but also because it makes them, stronger, more efficient, and more accountable.
What we do: IFC works with firms to attract and retain investment by promoting the adoption of good corporate governance practices and standards.
How we do it: IFC is building on its successful track record with the aim of delivering targeted corporate governance support to more clients and stakeholders for even better results by:
Assessing a firm?s corporate governance practices and providing advice on how to improve its practices.
Building capacity of local consulting firms, directors? institutes, media, and educational institutions to support corporate governance reform.
Working with regulatory institutions and governments to improve corporate governance laws, regulations, codes and listing requirements.
Raising awareness through conferences, workshops, roundtable discussions and training of business reporters as well as through the sharing of good practices.
Project Examples
Improving Corporate Governance in Southern Europe
Corporate governance has been gradually emerging as a key business concept in the countries of southern Europe, in particular as countries in the region seek foreign direct investment and are progressing on the European Union path. The Project supported Albania, Bosnia and Herzegovina, Kosovo, FYR Macedonia, Montenegro and Serbia in the adoption of sound corporate governance practices at the framework and company levels. The first phase of the project introduced corporate governance concepts to the market and representatives of market institutions and the private sector. The second phase focused on working in a more concentrated way with companies and public sector institutions that could play a role in promoting corporate governance.
Overall results and impact achieved: Reached 1,356 companies, financial institutions and other interested parties in the region.
Assisted over 77 companies in improving their performance and raising over $309.7 million of financing attributable to improvements in their corporate governance.
Supported the adoption of 24 laws, regulations, codes, and nationally disseminated corporate governance tools.
Helped 8 universities to develop and deliver postgraduate corporate governance programs, courses and modules.
Board Leadership Program Evolves to Better Respond to Client Demand: The Board Leadership Training programs? training of trainers (TOTs) remains the main flagship capacity-building activity of the IFC Global Corporate Governance Forum, with nine extensive training workshops conducted in the last six months. In the regions and countries where the program has already created a cadre of local trainers, the Forum introduced ?advanced? TOTs aimed at deepening the skills and build the confidence of trainers through concentrated mentoring.
In Nigeria, we partnered with the Financial Institutions Training Centre to localize and adapt the Banking Supplement and equip trainers to train directors in the local banking sector. Once these trainers completed the basic training, they went through the ?mentored? TOT stage, where they could apply their newly acquired skills under the guidance of our master trainers. They then attended the third stage workshop to hone their skills and address their last comments and feedback on the localized curriculum.
Overall results and impact achieved in Nigeria:
25 modules adapted and localized (including 8 new modules)
25 trainers trained
58 Nigerian directors trained during the first year (about 20% of the entire number of bank directors in Nigeria)
Promoting Corporate Governance Standards for Investors: IFC?s Corporate Governance Methodology has been distilled into a unified set of tools known as the Corporate Governance Development Framework. The Framework was adopted by 29 development finance institutions (DFIs), including IFC, in September 2011. Signatory institutions cover emerging markets around the world and represent assets of approximately $852 billion.
The Framework will help DFIs assess the quality of corporate governance at the companies in which they invest. Signatories to the Framework aim to raise awareness of the importance of good governance to sustainable economic development, both at the private and public sector levels. By adopting a unified approach, DFIs will set consistent standards for corporate governance due diligence and advance the business case for good corporate governance.
Selected overall results and impact achieved*:
Nearly $2.9 billion in financing facilitated between fiscal years 2006-12.
Over 10,000 entities received corporate governance advisory services.
65 corporate governance codes and laws enacted in 24 countries.
29 development finance institutions, including IFC adopted the Corporate Governance Development Framework in 2011.
Over 120 publications produced, including translations, and disseminated to internal and external stakeholders.
Provided corporate governance assessments to 68 IFC clients, representing more than $5.05 billion in combined new debt and equity investments in fiscal year 2012.
*As of June 2012
http://www1.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/corporate+governance/overview
Reporting and Relationships Case Study: Internal Auditing Reporting Relationships: Serving Two Masters
Review the information contained with the governance report, and answer the following questions:
?What is the correct relationship of internal audit to senior management?
?How should conflict be managed? Is conflict inevitable?
?What types of relationships would compromise independence?
?What should the Audit Committee of the Board of Directors do to ensure auditor independence?

Please write a thorough essay with zero % plagiarism

on the following topic

AUDIT Management

Learning Outcomes:

1. Evaluate the complexity of the governance environment and how different contexts and sectors have both different and similar governance needs.

2. Apply governance principles to the role of internal audit and make reasoned proposals for a value added role in various governance scenarios.

3. Assess the power and influence of different stakeholder groups, especially in maintaining organizational reputation and in Corporate Social Responsibility

4. Evaluate the complexity of the risk environment and risk responses, including the link with internal control

5. Apply risk management principles to the role of internal audit and make reasoned proposals for a value added role in various risk based scenarios

This assignment is based on the collapse of Rana Plazza in Savar, a sub-district of the greater Dhaka area in Bangladesh on 24 April 2013. Approximately 2,515 were rescued from the building alive, but 1,129 were killed. This has been described as ?history?s worst industrial disaster? (1).

There are many different organisations involved in this:

1. The company which owned the building which collapsed
2. The companies which leased / rented office / factory space in the building
3. The companies who sourced their goods and services from those tenanting the building.

In preparation for this assignment you must research the aspects of this incident. Marks will be available for evidence of wider research. However we have provided for you some of the sources that you may wish to review before completing the assignment.


1. www.bbc.co.uk
2. www.benetton.com
3. www.theguardian.com
4. http://www.ranaplaza-arrangement.org/fund
5. http://www.cleanclothes.org/ranaplaza
6. www.cnn.com
7. www.forbes.com
8. www.banglanews24.com
9. www.india.gov.in
10. www.usa.gov
11. www.gov.uk







Question 1

Consider the governance of the company owning Rana Plaza and describe the regional expectations as well as best practice in this area and the benefits that adoption brings. Evaluate the governance of Rana Plaza during and after the collapse of the building against these and explain how this helped or hindered Rana Plaza.


Word Count: Max 1,000

Question 2

a. Identify the stakeholders for Benetton, one of the fashion retail companies supplied by a manufacturing company based in Rana Plaza.

b. Evaluate the power and influence of each of these stakeholders using Scholes and Johnson matrix, to identify your ?key players?. This evaluation should be done in terms of the stakeholders? power and interest in the corporate social responsibility aspects of Benetton.


c. Explain the limitations of your identification and assessment of the stakeholders in a. and b. above.

Word Count: Max 500

Question 3

Consider the governance and risk management arrangements that should be in place over the contract between the manufacturing companies and the retail organisations.
Explain the following:

a. Top five risks
b. How to treat each of these risks
c. The responsibilities of each party in the treatment of the risks
d. How the risks should be monitored within the governance of the organisations

Word Count: Max 1,000

you are a financial advisor to corporate investors and they require you to select, for a substantial investment potential a plc, preferably a group, in manufacturing or retail, with a turnover of about ?50 to ?500 million. The organisation must be using international standards for finacial reporting.

once you have selected the organisation, you are required to write a report of analysing the group performance for the year, with suggestions of any improvements you consider neccessary, and recommend with reasons why the investment should be undertaken.

As PART of your analysis, you are expected to include the following:

1) adequacy of accounting policies adopted

2) the value of segmental information to the shareholders of the company selected

3) key ratios for the group. in this area significant subsidiaries must be separately identified and alaysed

4) corporate governace issues reported including internal audit and internal control

5) the significance of the audit report to employees, shareholders and potenial investors

==========================================================================
please can you make sure you use a uk company
please can you use figures for the ratios
please can you use figures as examples
can you make sure you break it down as simple as possible
can you also use graphs and diagrams for the ratios
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This paper is geared towards Information Security management, not IS technology per sa.

Assignment: Perform an in-depth analysis of an organization within information security management on a particular company that you may work for or know very well. The assignment should be written along the lines of Harvard Business or Sloan Management review case studies. The length should be between 3000 to 6000 words. It should describe the firms information technology and information security strategy. It should identify important issues that confront the organization. You should base your conclusions on standard information security practices. To conceptualize the assignment, imagine that you are on the research staff at a consulting group and you are writing a report about the strategic prospects of a client (information security posture). You should place a heavy emphasis on analysis and evaluation in your term paper. It should identify important issues that confront the organization.

OSI Inc. Global IT Mission Statement

The Global Information Technology Organization is to create a world class IT support system for OSI Systems and all its entities. IT will map technology with the human-user element creating solutions that the organizations will incorporate in their operations to achieve higher productivity- cost, efficiency-cost, and become more competitive in their business. IT will go beyond the traditional supporting role and address each department within each division and apply technology to enable their respective areas to achieve their predetermined goals that are aligned with the companys long and short term objectives. Meeting goals, achieving success, and evaluating services will be the cornerstone of the global IT organization.

OSI is composed of 3 divisions and corporate headquarters: Rapiscan Systems, OSI Optoelectronics and SpaceLabs Healthcare.

OSI Corporate is composed of:

Finance
Human Resources
Information Technology
Internal Audit
Law Department
Travel

Background: OSI Systems, Inc is a worldwide company based in California that develops and markets security and inspection systems such as airport security X-ray machines and metal detectors, medical monitoring anesthesia systems, and optoelectronic devices. OSI Inc. had sales of $595 million with net income of over $25 million. As of June 2010, the company employs approximately 2,460 personnel globally and includes subsidiary companies Spacelabs Healthcare, Rapiscan Systems and OSI Optoelectronics. OSI Systems, through its subsidiaries, have offices and plants in Malaysia, England, Australia, Africa, and the United States and Canada making it a truly global manufacturer. All subsidiaries and offices are connected globally to OSI through OSIs world-wide intranet system. Third party vendors are connected to the companys extranet.
With this backdrop in place it is easy to picture the potential scale of possible security problems and vulnerabilities facing the company. In this light, a throughout information security examination and evaluation of OSIs information security posture and practices will be conducted. This examination will be composed of the following information security components:
1. Corporate and IT Organizational structure including rules and resources with respect to information security
2. Stakeholders (users, managers, and designers) interacting with information security.
3. Security technology (technical platform)
4. Tasks associated with information security (goals and deliverables)
5. Information Security risks

Each main corporate office and facility plant has as its information technology security framework a combination of dual firewalls with appropriate DMZ zones within the firewall routers for outside user access along with numerous intrusion detection and protection hardware and software. OSI uses dual T1 lines for interconnection among its corporate entities. OSI also utilizes advanced virus protection and encryption technologies to ensure secure and safe operation and transfer of its data and applications. OSI also has several global and IT secure policies in place to ensure its security posture for both technology used and their internal personnel.
Interview questions with John Loo, senior director of Global IT services are below. A Contingency Plan (CP) is composed of the following:

1. Do you have a full Contingency plan (CP) in effect composed of BIA (Business Impact Analysis) ??" included in this are an Incident Response (IR), Disaster Recovery (DR) Plan and a Business Continuity (BP) plan? Do you have a Security Incident Response Team (SIRT) as well. His response was that he did not have a not have such a large encompassing plan due to the relative smallness of the company as compared to a General Electric or IBM. In fact many contend that this type of security philosophy is penny wise and foolish (Whitman & Mattord, 2010. 171). He said he had just a Disaster recovery plan which did not include an SIRT team. He said that he does not have a list of personnel that he calls from but basis his team on the immediate threat at hand. In the event of a vulnerability attack on the network, Mr. Loo would base the severity of the attack and that he himself would determine if it was just an incident or a major disaster. From there he would then determine the extra personnel that would be needed to take care of the threat. Again, no security team list is in place.
2. Do you classify, profile and describe any of the potential threats, vulnerabilities, and attacks, such denial-of-service, zombie attacks, etc., with a before, during, and after response description so that if any of these threats appear, you would have an adequate response against them? Again his response was that he did not put together such a listing profile because of the enormity and sheer number of different threats and vulnerabilities and the small size of his company. Mr. Loo also indicated that his primary fear or concern for security was simply having someone walk into an OSI facility, plant or office and plug their laptop into the network and be able to hack or password into the network and interrupt or steal company data.
3. If you Mr. Loo get sick, injured or die, who will follow into your place during an emergency? His answer was that he has back-up managerial personnel from Global IT and Telecom management to fill ??" in, in case he is absent.
4. Do you do practice or test any vulnerability attack scenarios, such as a simple desk check, structured walk-through, simulation, or full-interruption scenario, so that you know what to expect and do in a real-life situation? Mr. Loo indicated that he does not do any testing at all. It is all in his head.
5. Concerning a natural disaster within the business continuity and strategy plan, do you have a disaster recovery in place in case of a man-made or natural disaster that would destroy the corporate data center and its data? Mr. Loo indicated that he does have a back-up - a warm back-up site facility in Issaquah Washington. It is not a hot site where the company can immediately turn things on and start operating. Although all of the applications are loaded in the servers, the back-up data tapes and disks are stored in Burbank, CA and that they would have to be carried and sent over to Issaquah and then loaded into the databases and tested before operation can begin. That would take anywhere from 10 hours to 2 days for completion. If the situation was not totally disabling, he would just send the disks and tapes to the Torrance California facility and restore the servers from there. That would take less than a day.
6. Are all of the third party vendors that do business with the company on-board with back-up computing resources and services if needed? Mr. Loo indicated that he has agreements with all the vendors during an emergency or disaster but that he does not contact them frequently if at all and that he assumes that the facilities are on board with any disaster that may happen. This non-action can be very dangerous.
. Concerning crisis management and the press, how would you handle it? He said that he will be the main point of contact for the CEO and for newspaper and TV announcements to let the public know the situation of the disaster.
8. Since OSI has a risk assessment department, are they involved at all in the assessment of a disaster to the company? He said they were not involved in this area and that all planning and assessment was done in IT.
9. What is the relationship between the organizational structure of the IT department and its relationship with the CEO, as stipulated in the organizational hierarchy chart? Mr. Loo indicated that although there is no Chief Information Security Officer (CISO) between him and the CIO, the CIO is firmly committed to obtaining the resources and expenses for fully implementing proper security within the company. Unfortunately, the CIO himself does not directly report to the CEO but to the non-technical CFO Mr. Edick and that sometimes it is very difficult to obtain additional money and resources to fully implement all of Global ITs plans for security since the company has never had an IT or security real emergency before. Although it is quite common and natural for many companies, both small and large to place their security department or group within the IT organizational structure, this is not the best place for it. Given the seriousness for destructiveness due to loss data and networks, many organizations place their security group either within Legal or Insurance and Risk Management departments. Since OSI is small it is just within the IT department. Another factor is that the CIO and CEO are brothers and that can provide for a conflict of interest. This is why the CIO does not report directly to the CEO. This conflict imperils information security. Most experts agree that the CIO or CISO should report directly to the COO or President of the company. In case they do not. See diagram.
10. What are the duties and responsibilities of the individual stakeholders (users, managers, designers, and vendors) interacting with information security and that of Critical Electronic Data? See the Critical Electronic Data Policy attachment.
11. What is OSIs Global IT Security policy? See attachment file.
12. Do you provide for advanced IT and security training for your IT employees? Yes, we have extensive online and conventional training courses for our employees, including information security.
13. Stakeholders (users, managers, and designers) interacting with information security. Mr Loo indicated that Business unit managers are responsible for enforcing IT security policy and that individual users are also responible foull following IT policy concerninguser accounts and proper use of the computer. See policy documents
14. As far as risk management is concerned and even though the company the company
As defined by the U.S. General Accounting Office, a stakeholder is "an individual or group with an interest in the success of an organization in delivering intended results and maintaining the viability of the organization's products and services. Stakeholders influence programs, products, and services." (Allen, 2005) Information security planning should include the views of stakeholders, especially when you are planning for information security projects. The stakeholders buy-in is key to the success of information security in an organization. With the company's success in mind, decisions are less likely to be made based on personal beliefs when stakeholders views are considered.
Allen, J. (2005). Governing for Security: Project Stakeholders Interests. News at SEI. Retrieved on 5SEPT10 from http://www.sei.cmu.edu/library/abstracts/news-at-sei/securitymatters20054.cfm

Diver, S. (2006). Information Security Policy-A Development Guide for Large and Small Companies. SANS Institute InfoSec Reading Room. Retrieved on 30 Sept 10 from http://www.sans.org/reading_room/whitepapers/policyissues/information-security-policy-development-guide-large-small-companies_1331

Regardless of the size of the organization, it is important that security functions are perform somewhere in the organization. In chapter 13 of his Book called Information Security Roles & Responsibilities Made Easy, Charles Cresson Wood describes 12 options for placing security (listed below). But the ideal structure is to have information security independently reporting directly to the CEO. While due to budget constraints, many smaller organizations are forced to have security report to sub-organization like information technology or administrative service. In large organizations, information security is more independent and can be their own department. Note, that many laws and regulation require that security be well defined (see Table 1).
Maiwald, Eric & Sieglein, William (2002). Security Planning and Disaster Recovery. New York, NY: McGraw-Hill Professional

There are faxes for this order.

Topic- HR-business strategy with the following components

APA 6th Edition with in text citations with 8 total "sources" used

Primary use of text that will be provided via email.

Format as follows...

- Introduction- 200 words

- Part 1- 400 words

1.Develop a HR strategic formulation role that influences an HR competitive strategy.
2. Design a HR strategic execution role that influences an HR competitive strategy.
3. Systematize the opportunities of added value in HR-business strategy development and implementation.
4. Generalize strategic understanding of challenges and opportunities facing the business organization today.

- Part 2- 400 words

1. Write the elements needed for developing a competitive HR-business strategy in the work organization.
2. Predict the impact of HR-business strategy in human capital problem solving issues in the work organization.
3. Generalize an understanding of HR maturity level and its influences in the work organization.

-Part 3- 400 words

1. Generalize the importance and processes of External and Internal Audits ??" SWOT analysis of a company or business organization.
2. Generalize an HR-business strategy that considers SWOT implementation and performance evaluation of the organization's vision, mission, and strategic goals.
3. Hypothesize Michael Porter's point of view on "Fit" that discuses the functional strategy support corporate and competitive strategy advantage.
4. Generalize factors that influence HR-business strategy choice.
5. Systematize different organizational performance systems and factors that influences choice.

Part 4- 400 words

1. Write on how "McKinsey's Seven S Framework" which first appeared in "The Art Of Japanese Management" assist HR in strategy implementation.
2. Generalize concepts that aligns the business organization with its chosen HR-business strategy (i.e., its people, incentives, structure, supportive activities, and culture).
3. Generalize the use of crafting the right organizational structure and the importance of assessing culture and leadership of the business organization to ensure the right HR-business strategy alignment.
4. Formulate the effectiveness of an organization's alignment with human resources.
5. Schematize the development and alignment of an organization's HR-business strategy to the business.

Part 5- 400 words

1. What strategic human resources decisions advance the business strategy in todays competitive marketplace?


Conclusion- 200 words

Works Cited
There are faxes for this order.

Topic: United Airline
Reference: APA style
Requirement:


1.Vision and Mission of Organizations (one Pages)


A. United Airline Vision Statement?State vision and analyze it. How would you make it better?
B. United Airline Mission Statement?State mission and analyze it. How would you make it better?


2. United Airline Company Audit (three page)

a. External Analysis?Key competitive forces in Porter?s Five Forces Model. You need to detailed analyzes on each competitive force facing United Airline

b. Competitive Profile (CPM) Matrix?with brief discussions on each key factor.

c.Internal Audit?
For this project,
you need to identify FIVE weaknesses. Once you identify
those weaknesses in this case, you need to present the arguments
to support your opinions. Also,you need to discuss the negative impacts/influences of each weakness. Without
those arguments/discussions, you cannot strongly justify your points, and your
team will not get high score from your analyses. Anyway, you need to develop
the strong discussions to justify validities of each key issue in SWOT.

d: Fiancial ratio analysis: it needs to include the detailed interpretation and discussion of current financial ratios.P.S: Financial Ratios (Data should
be updated until one year from first day of Spring 2012 semester)

Review the ?7 Essential Elements of Enterprise Risk Management and the Role of Internal Audit? article.

Complete the Business Regulation simulation.

Identify the legal issues presented in the simulation and note the legal principles that apply to each of the issues you identified. Some issues may be more obvious than others. Repeat the simulation as much as needed to be sure you have identified all the legal issues and their corresponding legal principles.
Write a paper of no more than 300 words in which you complete the following:
Identify a tort violation from the simulation. Then use the 7-step process as defined in the Harb article to apply the risk management process to mitigate the business risk associated with that violation

I need an essay to answer the below question in one page (250 words or less). The aswer is below; however, I need to it to be rephrased and rewritten in essay format.

Q.1 Please describe a time when you utilised the strengths of different individuals to achieve a team task or objective.
How was the team identified? How did you make the most of their strengths? What was your role in achieving the task? What did you learn from this experience?

The answer:

When I worked as an acting head of IT department I led a troubled team and made a turnaround in a record time.
The team was in turmoil, overloaded by work and missing deadlines.
Tension was high among the members.
Many members did not have the required training.
There were integrated projects that involved other departments. The team did not have good terms with them.
Two crucial projects stacked in bottles necks for around two years.
In a series of one-on-one sessions, I took the time to listen to everyone in the team-what was frustrating them, how they rated their colleagues, whether they felt they had been ignored.
Then I directed the team in a way that brought it together: I encouraged people to speak more openly about their frustration and helped them to raise constructive complaints during meetings.
My role was to plan, coordinate and lead the team as well as reporting progresses of main projects to the CEO.
I tried to make them optimistic in the face of failure.
I used my ability of persuasiveness.
I created opportunities for them to assume responsibilities and develop themselves.
I increased their confidence in my integrity and effectiveness in leading change.
I injected my passion to them and unleashed their energy to improve.
I treated them in an informal manner.
I assumed resposibilities for communications and decisions.
I ran productive meetings and acted fast.
I spoke the language of we rather than I.
I learned the importance of integrity, trustworthiness, comfort with ambiguity, unleashing the energy of team members, self-confidence, realistic self-assessment, constructive criticism and understanding the teams emotional makeup.

====================================================================================
In the second page I want to edit and rewrite the following:

Advise and coordinate the development and implementation of special projects related to Riyad Capital various businesses.

Particiapte in the definition of Riyad Capital strategies and objectives. Also, assist in all aspect of Riyad Capital management as directed by the CEO.

1) Advice, coordination and support on designated projects.

2) Represent the executive office vis-a-vis other departments
with regard to designated projects.

3) Participate in the definition of the company's strategies,
objectives and plans implementation as required.

4) Assist the CEO in carrying out his management
responsibilities towards the company.

During this period:

1) The CEO and me developed the three years strategic plan for the period 2011-2013. I actively contributed to the establishment of a strategic position, efficiency, SWOT analysis, HR policies and operational effectiveness.

2) I worked with the head of Risk & Compliance to develop an action plan to the capital market authority.

3) I updated and initiated many Service Level Agreements (SLAs) with Riyad Bank.

4) I closed 28 past due internal audit outstanding control exceptions company-wide in 25 days.

5) I edited Arabic and English sell-side research reports issued from our research department.

6) I wrote the 2011 objectives for 10 departments heads who directly report to the CEO.

7) I did a peer comparison for our company that was submitted to the board members.

8) I reviewed and corrected mistakes in the HR manual of our comapny.

9) I worked as an acting head of the IT department and restructured the department and pushed two crucial projects through bottles necks that were pending for two years.

According to the CEO of Riyad Capital, I helped in changing the direction of the comapny; and this happens for the first time in the history of the company.

My work during this period was deeply appreciated by the board members.

Instructions: Feature article on David Tlale.
Do Not source or reference or copy from other online articles or sources. All the content information you need should be taken from this interview with David. Need to add in breaks/headings for major topics throughout the article. Example, the first heading could me something like The future accountant, or so I thought and then talk about how he started school and then changed course to be a fashion designer. Talk about his mom and how she was unsupportive in the beginning, until he won the first competition in his program, etc. Continue on to him being the first to have his coins, the first to secure a standalone slot to showcase under his own name at The Mercedes-Benz New York Fashion Week.

There are instructions throughout the notes below; please read carefully. The article features the attached dresses. He said each of the pieces I selected he was obviously happy about. Interestingly, each of the dresses represented a major transition in his career and personal life!

His story kind of reminds of Drakes story in his song, we started from the bottom now we're here. Perhaps this can be incorporated some how? Or find a song that could describe davids story. Davids one of 4 kids from a single mother, hes worked all his life. From someone who jumped in to fashion head first with absolutely no fashion experience and today hes built a strong African brand globally is truly inspiring! Hes made it desite all the challenges along the way.

--Story about orange dress
David Tlales orange chiffon dress with gold coins seems to achieve the impossible: it is form-fitting yet fluid. The top is a charcoal and gold-colored metallic jacquard sheath, while orange, Grecian-style drapery flows organically from the models shoulders to her ankles. Bright coins adorn the front. According to Tlale, the coins are real and were custom-minted with his name and year on it, exhibiting an attention to detail that is typical of the meticulous, yet passionate designers fashions. The dress was part of Tlales Climate Change Couture Collection which launched during Africa Fashion Week at the South African Mint factory in 2011.

The vision for the dress began when Tlale was approached by the South Africa Mint to collaborate on an environmental awareness campaign. The Mint developed the coins and medallions minted with Tlales name on it in his honor. Tlale is the first fashion designer in South Africa to have a commemorative medallion minted with his name, one of the greatest honors of his ten-year career.

The dress is meant to symbolize fire, one of the side-effects of climate change. However, in addition to its symbolic importance, it also has a rare quality of merging the sophisticated with the primal in its colors and lines. It is simple and flattering yet also volcanically sexual. Indeed, Tlale says that he deliberately draped the chiffon to make it appear like an overflow of volcano, while the metallic fabric and coins represent dried-up ash.

Tlale says that he designs his dresses to be worn by women of all body types. That is why Tlales design process is highly organic??"the dress was never sketched, but rather built through trial and error. Tlale lets the fabric become what it wants to be, just as he hopes his dresses allow women to be all they want to be.


---

Born in Boksburg, South Africa

Raised by a single parent, his mom. He has 2 sisters and 1 brother. 1 sister is a draping specialist at his company and his brother works at his company as well. Mom raised all 4 of them alone.

He went to primary and high school in boksburg

He went to Tshwane University for internal auditing, he wanted to do accounting because he needed to be educated and he was good at it. He only spent 8 months in the program

He saw crazy fashion students on campus. Ask them why they were always carrying luggage. Introducted himself to those kids and wanted to hang out with them. That was a turning poing for him to go study fashion

He went then went to Vaal University to study fashion for 4 years. He had no background in fashion, but worked really hard. His first year he admitted that he was just an average student

There was an annual fashion show. His classmate won the best 1st year student in fashion prize that year. He was driven by that. He told her watch this space. He then went to school and home only to improve himself.

Soon after he won best student his 2nd, 3rd, and 4th year at school. He put pressure on himself.

The school called him to be a tutor to fill in for the lecturer on maternity leave.

Then, he spent 4.5 years as a teach in basic design.

He kept doing the same thing and wanted to be out of the bushes. He needed to do more than just teach.

So, in 2003, he quit. He wanted to build his brand as a designer. He left home in his early 20s with nothing. He just made dresses, prom dresses, bridesmaids dresses for money

He said his first year was difficult. It was tough getting by. One day he saw an ad for the Elle New Talent Competition. He went to apply and found out that he needed to submit storyboards and materials overnight. He was totally unprepared and he just worked overnight to get it done. He said 3 days laterr, he made it to the top 12. 3 months later, he joined the showcase with the best 12 in the country and he won in 2003! David won the 2003 Elle New Talent Competition! That pretty much launched his career as a fashion designer.

Fast forward to 2005, it was so difficult. He had rent to pay, no full time job, he needed to make money. He said fashion isnt all that it appears to be in the real world. He was a new comer. Not everyone embraced his signature. He had to go back to lecturing.

One day he got a call from House of Monatic to work there as head designer in cape town. He couldnt work there full time because he was still trying to get his design studio up and running in Johannesburg. So, he would go to cape town every other week. He said it was very demanding, but it was okay they needed each other. It was a win win situation. He learned a lot about manufacturing, tailoring, fabrics. He did that for about 2.5 years. He got tired of doing it and quit, so he could go and work on his brand.

Its 2007 and he went back to Johannesburg. He joined the organization, Africa Fashion International. He was 1 of 4 designers to present in Paris Coutoure week. That was a turning point in his life because now the world got a chance to see him.

In 2008, he said he won against other fashion designers with the most votes as the Mzansis Star Fashion Designer at the Mzansi Star Awards

2009 was also a big year for him. He won the Fashion Designers of the year at Arise Africa Fashion Awards. Its was at the first showcase in New York. It was a long journey, but he says hes still growing. He said at that point he needed to go on his own. Who remembers competitions and group shows?

Hes not looking down on the platforms introduced to him. But he just wants to focus on david the brand on his own. He says the Brand doesnt get recognized during the competitions or at fashion week.

He says he needs to take the brand and build it in the US. It is time.

In 2010 and 2011, he was part of UCOF. He said hes part of UCOF every season. Its a great platform. *Im actually friends with the Founder of UCOF, Ciano Clerjuste (yay!)*
David kept on being persistent. Making sure the presence of David in New York as a brand is recognized, even if not on a platform.

Bloggers, writers, the hussle still goes on. Hes knocking on doors for showrooms. To get people to know about him. He supports UCOF. Hes trying to be at fashion week.

Making all these investments. This is who he is. Last Feb, 2012 he submitted a lookbook to IMGs fashion dept to show case for fashion week. He said not everyone knows that its a long process to be selected for fashion week. He went through a series of interviews for Mercedes benz fashion week. He went through the consulate for help. They set up a presentation to set up somethng for him in NYC for him alone. It was nice, it allowed him to showcase his pieces and network and meet relevant people to prepare a lookbook for NY. Findhing an agency, a showroom, etc.

Hes excited new Yorkers are excited to see him

In July 2012, the SA Consulate in NYC organized a meeting with IMG. He had to come up with a portfolio to present and he was interviewed.

David came up from SA to do the meeting. Its the mission of the SA consulate to grow trade outside SA to makes sure business with SA is responsible in a foregin country that grows. He took it upon himself to go to the consulate and the consulate general embraced it. Its good for the country and relationship in NY and SA. It unlocked doors to have the channel open. The consulate was super helpful. He said the they advocated for him. He was then accepted for Fashion week in Sep 2012!

This was the 1st presentation at fashion week on schedule. To see his anme with others like zack posen and others the same day was monumentous.

SA is a standalone as a brand, not as a group with others.

This was a huge turning point in his career. To be on schedule, everything changed. Hes now an international brand on an international platform. His choice of fabrics, choice of finishings, those changed. His designs didnt change. But he felt more exposed because he was on the international stage. The brand must compete with others, but not David can try. Everything escalated 10 times now, this was on another level. Competing on a global space.

Hes now developing his own prints and fabrics because of the time of season they are in as a brand.

He said they were accepted to come back for a second time, Feb 2013. He said just because he got accepted for the Fall doesnt mean hes a given the next go round. He said its not automatic. Hes a 2nd comer, sort of ahead of others for those still trying to apply. Its a building process.

Feb 2013, everything changed. The media, the writers, the bloggers, personal shoppers from top department stores were interested in him.

He said its a blessing for Fern Mallis to take notice of him. This was BIG news for him. She was the Executive Director of the Council of Fashion Designers of America (CFDA), SVP of IMG for 10 years, etc. Shes known to be the creator of "Fashion Week" in NYC

He says that helps strengthen his brand and signature, totally raises the bar. Its a beautiful journey. Hes in a beautiful space right now. He sees the brand evolving more and he wants to see it improve. Hes building clientele in New York??"he plans to be back in NYC in about 2 weeks for meetings with showrooms, buyers discussing his product.

He keeps making waves in New York, thats what hes all about. Ultimately, he wants people to shop David Tllate in New York, he needs his success to translate commercially. He wants to see ready to wear pieces, so hes focused on manufacturing, supply, and ready to wear.

Asked about how his family thinks of him, his journey.

He said for his mom, she wanted no son to make clothes. She told him to go back to school early on during university. She told him to go back to school and get a proper job.

She said there will be no dressmaker in this house. She was extreme and not supportive at all. He said he was a hustler and got loans to register for school. He got no support from her aside from rent and living expenses. He said she came around when he won his first prize during his 2nd year at university. She understood when he made the first outfit for her.

When he won the Elle New Talent competition, she was the proudest mother. He had to take her on a journey. She started to pray for him. She said even though she doesnt understand everything, she still asked for god to provide him with many blessings.

He remembers when he sat her down. He was living out of a suitcase then, but talks about another proud moment when he opened his first store at the The Michelangelo Towers---its an iconic building in South Africa. THE place to be for retail. He said that was his moms proudest moment was at the store opening. For him to witness his mom seeing that moment really touched him. He said she still doesnt get the magnitude, but she sees and understands hes successful and proud of him.

He said there are some many inspirations in his life. Hes been through ups and downs.

Like an artist, he sees what he feels. He doesnt have a particular look. It just depends on what hes feeling and what he wants to say.

He imports fabrics from korea, paris, Europe, india

He looks up to people like mcqueen, Armani, dona kaen

Each season is different message.

He doesnt have a muse, his ideal woman is someone who can wear his clothes with confidence. Someone whos not scared to make a statement. People must ask who are you wearing, then you know you have done your job as a designer.

He doesnt stick to 1 body type. Hes based in Africa, so he sees voluptuous women day in and day out. He wants women to embrace their body. As long as they can wear his clothes with confidence is all that matters.

I asked him about the three dresses I sent him. He said its difficult to say which is better. He goes into the orange dress (see the above story written about the orange dress)

Then we talk about the dress with the black lace on top. He said he developed the fabric and textured the lace. It started out as a pencil skirt. He inserted a full circle godet, he explained it was part of pattern making. So instead of a full circle skirt, this creates massive fullness and it added volume to the skirt. He said the first moment he filled the back of the skirt and it flowed he said he knew he was on to something. The black lace on top with the sheer panel on the front came right after.

He said his design process wasnt limited to sketch. He wants his process to evolve and let the fabric become what it wants to be.-? huge! Sometimes youll have the the concept an sketch and the fabric simply wont allow it.

Some believe in sketching, draping, but goes by an organic process.

The yellow gold dress was made from silk chiffon, embroidery and gold sequence, Not brocade it was all done by hand. Its all 1 dress not a 2 piece. He started with the boned corset, then draped the skirt. Then deep died the dress into cream. Then finished it with a gold bead shoulder panel. This is purely a couture piece for show. He said he kept trying and building the dress until it was ultimately done. He said he added sequence, and the should piece just added to bring more luxury to the dress. He said, youre as good as your last dress. He said the shoulder panel was his ultimate favorite about this dress. He said he was inspired by the Oscars as it was 2 weeks away while he was making the dress. So, thats when he added the shoulder panel to the dress. He said at the end of the day, it took about 6 weeks to make start to finish. At the last minute he decided to dip the dress into gold die then added stones to the outside of the dress to finish it off, he said it was magic.



The gold dress was part of the same collection he featured at the South African consulate.

He said there was a burgundy and black dress that Marcus Samuelsson's (Marcus is a famous chef) wife Gate Maya Haile (famous model) posed that was highly viewed. I said I noticed that dress, but for me Im personally not a fan of two dark colors colliding like that. He said the pairing was pristine and powerful. He wanted to evoke that feeling. Especially since it was for his fall/winter collection. He said that was the showstopper dress on the runway.

He said each of the pieces I selected he was obviously happy. Interestingly, each of the dresses represented a major transition in his career and personal life!

1- The orange dress??"no other fashion designer had /has a coin made

2- The black lace with red/cream/brown no other fashion designer presented during fashion week as a stand-alone designer that was a first. That was the first time he was part of new York fashion week for spring/summer. He said i was a beautiful transition

3- The gold dress was the second time he was at fashion week. This was a big achievement to be at new York fashion week for the second time in a row AND in the same year as his 10th anniversary of this brand.

He considers himself to be spiritual and has a personal relationship with God. Be believes everything is God orchestrated. All this is Gods grace he says. For him to have his boutique at the most expensive center in South Africa is an achievement---this is the The Michelangelo Towers hes referring to. Hes the only South African designer at that center. In 2003, he would never have thought to be in that space and he is.

He says today, hes just starting to see results of his work. Hes not saying he has arrived, he says hes only just begun!

In his wildest dreams, he sees a David Tlale boutique in New York, London, Partis, etc. He wants to touch peoples lives throughout the world. He wants to be seen as one of the iconic brands. He knows its possible. He says in 5-10 years he sees his store on Madison or 5th Avenue. He sees his brand evolving into a lifestyle brand with sunglasses, bags, and accessories.

He makes time for family. If hes in South Africa on a Sunday, hell most likely be with his family for dinner at his moms house. He doesnt work on Sundays, he goes to church. Even outside of SA, hell try to find some place to fellowship.

David said hes lives, works, and speaks about his brand often. There will be a time to rest, but right now its time to build. Opportunities are unfolding and he cant say no to work right now. Hes not in a relationship right now because its too distracting. Its work, God, and family now.

He said he has to be selfish with time and how he spends it.

He started an initiative called the intern project. Kind of like project runway. Across 9 provinces in south Africa; he launched the first province last Friday in Durban. Hes looking for interns to mentor. He picks 2 winners within each province, runs workshops and competitions, and showcases the winner designes. Its a program for them to work with him at his boutique in Johannesburg for a year. At the end of 3 years, hell have 18 qualified designers who were under his tutilidege, thats his way of giving back. He said he wished he had something like that when he started. He would take the interns with him to new York fashion week, so they can see for themselves what its all about. Its a lifetime opportunity hes giving to young designers to benefit.

From his experience, he wants to share with others and hopefully build/leave a legacy.

There are faxes for this order.

Instructions:
Focus on NCF?s O&Ds? fido duties ??" loyalty, due care, good faith and candid disclosure; underwriting policies, if any; sub-prime risk management controls; issues relating to kickouts, EPDs and FPDs; NCF?s exposure to operating risks including technology, systems (including internal controls), and personnel; repurchase reserve risk management including interest recapture risk; any problems relating to residual interests, OBS policies; any substantive accounting issues; failure of the outside auditors; and maybe any management shortcomings.

1. Strategic objectives? Their business model to achieve objectives?
2. Principal risks?
3. Performance variables, metrics? Did they performan in line with metrics?
4. Key reporting items in NCFs financials? Examiners take on possible reporting errors?
5. Why did NCF fail?
6.Was the Board paying attention? Whered they come up short in their duties?
7.Any other stuff? Financing strategy? Liquidity risks sorta like LTCM?


Only include this source article:

I. INTRODUCTION AND EXECUTIVE SUMMARY
On February 7, 2007, New Century Financial Corporation ("New Century," or the "Company") announced the need to restate its financial statements for the first three quarters of 2006. At the time, New Century was the second largest originator of subprime residential mortgage loans, which are loans made to borrowers who represent a high level of credit risk. The Company had grown at an incredible pace since inception, from originating $357 million in mortgage loans in its first year of operation in I996 to approximately $60 billion in 2006. New Century's equity securities were traded on the New York Stock Exchange ("NYSE"), the Company had a market capitalization of over $1 billion in February 2007, and it had credit facilities of $17.4 billion to finance its activities. New Century reported net earnings of $411 million for 2005 and $276 million for the nine months ended September 30, 2006.

The February 7, 2007 news that New Century needed to restate its 2006 interim financial statements caused a dramatic and swift descent of the Company. Immediately following the announcement, New Century's stock price dropped precipitously, and the Company disclosed on March 2, 2007 that it would not file its 2006 Annual Report on time. This revelation and other developments prompted increased margin calls by the Company's lenders, accompanied by their refusal to provide further financing. As a result of these financial pressures, New Century stopped accepting loan applications on March 8, 2007, and the NYSE delisted the Company's securities on March 13, 2007. On April 2, 2007, New Century and many of its affiliates (collectively the "Debtors") filed for bankruptcy protection. KPMG LLP ("KPMG") resigned as the independent auditor for New Century on April 27, 2007, and the Company announced on May 24, 2007 that its financial statements for the year ended December 31, 2005 also should no longer be relied upon.

On June I, 2007, this Court issued an order directing the United States Trustee for Region 3 ("U.S. Trustee") to appoint an Examiner to, among other things, "investigate any and all accounting and financial statement irregularities, errors or misstatements" and "to prepare a report within 90 days of the date of appointment, unless such time shall be extended by the Court." On June 5, 2007, the U.S. Trustee appointed Michael J. Missal as Examiner and that appointment was approved by this Court on June 7, 2007. On November 21, 2007, the Examiner filed his First Interim Report related to the possible post-petition unauthorized use of cash collateral by New Century. The Court subsequently extended the date to file this Final Report unti! Febroary 29, 2008.

The Examiner has completed his investigation and files this Final Report. The Examiner recognizes that the subprime mortgage market collapsed with great speed and unprecedented severity, resulting in all of the largest subprime lenders either ceasing operations or being absorbed by larger financial institutions. Taking these events into consideration and attempting to avoid inappropriate hindsight, the Examiner concludes that New Century engaged in a number of significant improper and improdent practices related to its loan originations, operations, accounting and financial reporting processes. KPMO contributed to certain of these accounting and financial reporting deficiencies by enabling them to persist and, in some instances, precipitating the Company's departures from applicable accounting standards.

The June I Order required the Examiner to identify any potential claims that the Debtors' estates may have arising out of any improper conduct. The Examiner believes that at least several causes of action may be available to the estates. First, the estates may be able to assert causes of action against KPMO for professional negligence and negligent misrepresentation based on KPMG's breach of its professional standard of care in carrying out its audit and reviews of the Company's financial statements and its related systems of internal controls. Second, the estates may be able to assert causes of action against some former Officers of New Century to recover certain of the bonuses paid to them in 2005 and 2006 that were tied, directly or indirectly, to New Century's incorrect financial statements. These causes of action could seek millions ofdollars in recoveries.

New Century's Officers and Directors owed the Company fiduciary duties ofloyalty, due care, good faith and candid disclosure. The Examiner has assessed the conduct of certain former Officers and current and former Directors to determine whether their actions or inactions may give rise to potential causes of action on behalf of the estates. Breach of fiduciary duty claims against officers and directors have strong defenses to overcome, particularly the business judgment rule and statutory or other limitations. Accordingly, the Examiner has not included a detailed discussion ofsuch potential claims. Nonetheless, because questions may be raised about the conduct and level of care exhibited by the former Officers and current or former Directors, some potential areas ofconcern are outlined in this Final Report.

All of New Century's revenues, assets and operations were directly affected by the Company's subprime lending policies and practices. It is therefore pertinent to New Century's accounting and financial reporting processes to examine issues related to the Company's loan originations.

New Century had a brazen obsession with increasing loan originations, without due regard to the risks associated with that business strategy. Loan originations rose dramatically in recent years, from approximately $14 billion in 2002 to approximately $60 billion in 2006. The Loan Production Department was the dominant force within the Company and trained mortgage brokers to originate New Century loans in the aptly named "CioseMore University." Although a primary goal of any mortgage banking company is to make more loans, New Century did so in an aggressive manner that elevated the risks to dangerous and ultimately fatal levels.

The increasingly risky nature o f New Century's loan originations created a ticking time bomb that detonated in 2007. Subprime loans can be appropriate for a large number of borrowers. New Century, however, layered the risks of loan products upon the risks of loose underwriting standards in its loan originations to high risk borrowers. For example, more than 70% of the loans originated by the Company had low initial "teaser rates" that were highly likely to increase significantly over time. A senior New Century officer noted in 2004 that borrowers would experience "sticker shock" after the teaser rates expired. More than 40% of the loans originated by New Century were underwritten on a stated income basis. These loans are sometimes referred to as "liars' loans" because borrowers are not required to provide verification of claimed income, leading a New Century employee to tellcertain members of Senior Management in 2004 that "we are unable to actually determine the borrowers' ability to afford a loan." Another common loan product offered by New Century that had a high degree of risk was the "80120" loan, which involved two separate loans for the same transaction: a first lien mortgage loan with an 80% loan to value ratio and a second lien loan with a 20% loan to value ratio, resulting in a combined financing of 100% of the value of the mortgaged property. One Senior Officer o f New Century noted in early 2006 that the performance o f these 80/20 loans in 2005 was "horrendous."

New Century also made frequent exceptions to its underwriting guidelines for borrowers who might not otherwise qualify for a particular loan. A Senior Officer of New Century warned in 2004 that the "number one issue is exceptions to guidelines." Moreover, many of the appraisals used to value the homes that secured the mortgages had deficiencies. Of the New Century loans rejected by investors, issues with appraisals were the cause of more than 25% of these "kickouts."

Senior Management turned a blind eye to the increasing risks of New Century's loan originations and did not take appropriate steps to manage those risks. New Century's former Chief Credit Officer noted in 2004 that the Company had "no standard for loan quality." Instead of focusing on whether borrowers could meet their obligations under the terms of the mortgages, a number of members of the Board of Directors and Senior Management told the Examiner that their predominant standard for loan quality was whether the loans New Century originated could be initially sold or securitized in the secondary market. This attitude resulted in an increasing probability that New Century would have to repurchase billions of dollars of the riskier loans because of significant defaults or loan defects, particularly if market conditions changed. Some New Century employees recognized the increased perils of these mortgage products and lending practices starting no later than 2004, and recommended changes to manage and minimize risk. These recommendations, however, were either largely rejected or ignored by Senior Management, until market forces drove changes to the Company's practices in the second half of 2006. By that time, however, billions of dollars of dubious mortgages were either held by New Century on its balance sheet or injected into the markets.

Senior Management was aware of an alarming and steady increase in early payment defaults ("EPD") on loans originated by New Century, beginning no later than mid- 2004. The surge in real estate prices slowed and then began to decrease, and interest rates started to rise. The changing market conditions exacerbated the risks embedded in New Century's products, yet Senior Management continued to feed eagerly the wave of investor demands without anticipating the inevitable requirement to repurchase an increasing number of bad loans. Unfortunately, this wave turned into a tsunami of impaired and defaulted mortgages. New Century was not able to survive and investors suffered mammoth losses.

Senior Management similarly gave inadequate attention to the increasing amounts of investor "kickouts." Many loans were rejected for reasons that should have been relatively easy to fix, such as missing documentation from newly funded loan files. Indeed, one former New Century manager recognized that "if we could just cure the no brainer type items l list below we would serve ourselves well." The problem was not cured and kickout rates increased over time. Between 2004 and the end of 2006, investors rejected approximately $800 million in loans simply due to missing documentation, and billions of dollars of loans for other reasons. Investor kickouts resulted in millions of dollars in additional expenses for New Century to correct and maintain these loans, wasting New Century's assets and further impairing liquidity.

New Century also did not invest in the necessary technologies, systems or personnel to meet its growing business and expanding challenges. Many of the Company's failures can be traced at least in part to these inadequacies.

New Century's Senior Management did not set an appropriate "tone at the top." Many former New Century employees rationalized the Company's actions with the belief that the Company was conducting business in the same manner or even better than its competitors. The Examiner did not review the practices of other similarly situated companies, but even if New Century's practices were not outside the norm of its industry, this would not absolve anyone from failing to follow applicable accounting rules, legal standards or prudent business practices.

New Century engaged in at least seven wide-ranging improper accounting practices in 2005 and 2006, most of which were not in conformance with generally accepted accounting principles ("GAAP"). As a whole, these practices resulted in material misstatements of the Company's consolidated financial statements for at least the fiscal year ended December31, 2005 and the first three quarters of 2006. The Examiner did not find sufficient evidence to conclude that New Century engaged in earnings management or manipulation, although its accounting irregularities almost always resulted in increased earnings. Ironically, New Century branded itself as a "New Shade of Blue Chip," a marketing campaign which claimed that the Company would outperform its competitors by showing strong results achieved with "integrity." It is now clear that the New Century did not achieve its financial results with "integrity."

New Century disclosed on February 7, 2007 that it had not been accounting properly for the reserve for losses associated with the repurchase of loans previously sold to investors. The Examiner's investigation determined that New Century calculated the repurchase reserve incorrectly by not accounting for the growing backlog of repurchase claims relating to older loan sales and by excluding interest that needed to be paid to investors ("Interest Recapture") at the time ofloan repurchase. Specifically, New Century did not include the back- log of outstanding repurchase claims in any of its repurchase reserve calculations and excluded

Interest Recapture from the repurchase reserve calculation for 2005 and the first two quarters of 2006. The Examiner further determined that New Century reduced its repurchase reserve calculation in 2006, at a time when the Company was being flooded with repurchase claims from investors, by excluding two other critical components. In the second quarter of 2006, New Century removed a loss severity component on the existing inventory of loans already repurchased and included in the Loans Held for Sale ("LHFS") account. The Company then also removed loss severity on estimated future repurchases in the third quarter of2006. These critical omissions and changes were a violation of GAAP and materially understated the repurchase reserve by at least $104.8 million by the third quarter of 2006. New Century also failed to apply appropriately lower of cost or market ("LOCOM") accounting in valuing LHFS. By the third quarter of 2006, the LHFS account was overstated on New Century's financial statements by at least $85.8 million.

Several interviewees claimed that KPMG actually recommended the improper changes to the repurchase reserve calculation that were made in the second and third quarters of 2006. Although KPMG denied recommending any changes, it acknowledged discussing the issues with New Century at around the time they were made, and its workpapers document the changes. The workpapers further reflect that KPMG evaluated and approved the third quarter change. New Century is ultimately responsible for the accuracy of its financial statements, but KPMG bears responsibility, at a minimum, for suggesting accounting changes in the second and third quarters of 2006 that were inconsistent with GAAP and for failing to detect the material understatements of te repurchase reserve and the LOCOM valuation account. Further, members of the Accounting Department and KPMG should have advised the Audit Committee of these material changes to its repurchase reserve calculation, particularly since the Audit Committee specifically inquired about the adequacy o f the repurchase reserve during these time periods.

New Century failed to value properly residual interests that the Company held in off-balance sheet securitizations, which represented hundreds of millions of dollars on its balance sheet. Residual interests were New Century's rights to remaining cash flow or other assets from pools of mortgage loans the Company had securitized. New Century used flawed models to value those residual interests. The Board of Directors, Senior Management and KPMG paid close attention to the valuation of residual interests and knew that New Century was using more aggressive assumptions, including low discount rates, in the valuation models than those of its competitors.

If New Century had used a more appropriate discount rate to compute the present value of future cash flows, the residual interest valuations would have been reduced by at least $14.8 million as of December 31, 2005. Other flawed assumptions resulted in the further overstatement of residual interest valuations by at least another $27.5 million as of December 31, 2005. The Examiner finds that KPMG improperly acquiesced in New Century's reliance upon aggressive or stale assumptions in its residual interest valuation models. The Examiner further finds that KPMG failed to insist that New Century cure significant internal control deficiencies with respect to the valuation of residual interests, such as the absence of documentation describing how the residual interest valuation models worked and how the assumptions used in the models were established, revised or approved.

The Examiner identified five other problematic accounting issues in 2005 and 2006 related to: (i) its allowance for loan losses ("ALL") with respect to loans it held for investment; (ii) its mortgage servicing rights ("MSR"); (iii) its deferral and amortization of loan origination fees and costs; (iv) its hedge accounting; and (v) the $77.7 million of goodwill that New Century recorded in connection with its acquisition of the loan origination platform of the prime mortgage retail division of RBC Mortgage Company. While problems associated with these accounting issues were not of the same financial magnitude as New Century's errors with regard to its repurchase reserve calculations and its valuation of residual interests, they shared some disturbing characteristics that revealed flaws in New Century's accounting and financial reporting processes.

The problematic themes these accounting tssues shared included accounting practices and/or methodologies that were inconsistent with GAAP or otherwise subject to criticism by KPMG; not documenting key assumptions underlying New Century's accounting; using discount rates in key areas of accounting that were low when compared to discount rates used by peer firms or the rates used internally by the Company when developing New Century's business plans; and dismissing or minimizing the significance of New Century's accounting errors or departures from prescribed accounting practices on grounds that they were "immaterial," even in the absence of documented support for these conclusions.

As a consequence of these accounting failures, New Century understated its repurchase reserve by as much as I000% in the third quarter of 2006, reported a profit of $63.5 million in the third quarter of 2006 when it should have reported a Joss, met analysts' earnings expectations for 2005 and the first quarter of 2006 when it should have announced earnings below expectations, and reported an increase in earnings per share ("EPS") of 8% for the second quarter of2006 as compared to the same quarter of2005, when it should have reported at least a 40% decline in EPS. Senior Management benefited from these errors as the three founders (Robert Cote, Edward Gotschall and Brad Morrice) received financial performance bonuses in 2005 that were at least 300% more than they should have been. Other Officers received financial performance bonuses that were approximately 130% to 270% higher than appropriate.

KPMG contributed to these failings in critical ways. Among other inadequacies, KPMG failed to question or test certain important assumptions in a rigorous manner. The KPMG engagement team acquiesced in New Century's departures from prescribed accounting methodologies and often resisted or ignored valid recollUIJendations from specialists within KPMG. At times, the engagement team acted more as advocates for New Century, even when its practices were questioned by KPMG specialists who had greater knowledge of relevant accounting guidelines and industry practice. When one KPMG specialist persisted in objecting to a particular accounting practice on the eve of the Company's 2005 Form 10-K filing -- an objection that was well-founded and later led to a change in the Company's practice -- the lead KPMG engagement partner told him in an e-mail: "I am very disappointed we are still discussing this. As far as I am concerned we are done. The client thinks we are done. All we are going to do is piss everybody off."

Other conduct by KPMG was equally troubling and puzzling. KPMG signed off on a New Century repurchase reserve based on the estimate that the Company would need to repurchase approximately $70 million of the loans sold in the fourth quarter of 2005. At the same time, KPMG's workpapers showed that the number of loans that New Century was going to need to purchase was approximately $140 million, not $70 million. KPMG had no explanation for this large discrepancy. Whether careless or intentional, KPMG's error contributed to a significant understatement of the repurchase reserve.

New Century made a number of false and misleading statements in its public filings, press releases and other communications. For example, New Century disclosed in its Form 10-K for 2005 and Forms 10-Q for 2006 that the Company "occasionally" may repurchase loans beyond the 90-day period after the loans were initially sold. These statements were misleading at best, as New Century knew it had a large and growing backlog of repurchase claims more than 90 days old, an important metric for those analyzing the Company's financial statements. The Examiner did not review all of New Century's public statements, but identified certain problematic statements in connection with the analysis o f other issues.

There was an unhealthy friction between the Board of Directors and Senior Management at a time when the business challenges would have greatly benefited from a strong collaborative relationship. An effective working relationship between a company's Board and Senior Management requires mutual respect and a healthy tension. However, this was not the situation at New Century in at least 2005 and 2006. In fact, a number of Board members were openly disdainful of certain members of Senior Management and challenged their integrity and competence. One former Director questioned whether "Management has been providing the board with full disclosure and whether Management judgments have been appropriate." That same Director further "seriously questioned" in 2005 whether "Management has been manipulating earnings." Members of Senior Management believed that some Board members were misguided and involved in issues outside their authority. This tension inhibited an open flow o f information between the Board and Senior Management and restricted the ability o f New Century to react nimbly and effectively to the rapidly deteriorating subprime market.

New Century failed to have an effective system of internal controls. An effective system of internal controls is critical for any public company as it is required by law and promotes accurate reporting, effective operations and compliance with applicable laws and rgulations. Nonetheless, New Century had a number of deficiencies in its system of internal controls, including not tracking the growing backlog o f repurchase requests related to older loans sold to investors, not remediating certain control deficiencies identified in earlier audits and not having proper documentation for key financial processes. These inadequacies contributed to many of the accounting and financial reporting deficiencies identified in this Final Report. KPMG was also to blame as it did not uncover significant internal control deficiencies.

While New Century had an active Audit Committee, it failed to focus on certain issues of crucial importance to the Company, such as loan quality issues in 2004 and 2005, ensuring a sustained analysis by Management of entity-wide risk, key operational risks and proper supervision of New Century's Internal Audit Department. Audit Committees are a vital corporate governance gatekeeper and play an important role in assuring the accuracy and integrity of a company's accounting and financial reporting processes. Had the Audit Committee addressed these issues more effectively and with more urgency, some of the accounting and operational failures may have been avoided.

New Century's Internal Audit Department was also deficient in a number of ways, including not giving adequate attention to kickouts and repurchase claims, and not thoroughly assessing corporate or operational risks. Because New Century was in an industry with extremely high risks, a strong Internal Audit Department was that much more crucial. Unfortunately, New Century's Internal Audit Department was not as strong a corporate governance mechanism as was needed.

The demise of New Century was an early contributor to the subprime market meltdown. The fallout from this market catastrophe has been massive and unprecedented. Global equity markets were rocked, credit markets tightened, recession fears spread and losses are in the hundreds of billions of dollars and growing. While these consequences are not the result of the activities of just one company, the lessons to be learned from New Century's failures will hopefully strengthen and improve future activities within the mortgage and financial services industries.

Dear Assay town,
Kindly use the following references in this dissertation
1. Market driven management (Jean-Jacques lambin) 2000
2. Marketing plans (MALCOLM McDonald) fifth edition
3. Marketing management ( Kotler- the millennium edition)




Competitive advantage based upon market-driven business philosophy:
How a pharmaceutical company can sustain a competitive advantage


Abstract
Today . . . pharmaceutical firms find themselves in an environment characterized by downward pressure on revenues (driven by greater competition and institutional changes), upward pressure on development and manufacturing costs (driven by technological complexity and regulatory forces), and shorter product life cycles over which to recoup fixed R&D and capital investments. Additionally, shorter product lives mean that firms have less time to drive down costs to profitable levels before substitute or generic products reach the market.

This thesis will address the ability of a Sanofi-Synthelabo ?Dubai (an affiliate for a French international pharmaceutical company) to maintain a sustainable competitive advantage, based on adoption of a market-driven business strategy.

The importance of such paper, emerge from the fact that Sanofi-Synthelabo possess a great portfolio of products in the Gulf area, however the company still can not differentiate its products versus its competitors and subsequently still there is a great potential for the company to grow . The objective of the research is to introduce a more sophisticated marketing function to the marketing department of the company as well as to redefine the marketing responsibility inside the company to emphasize the concept that every one in the company has a piece of action all the way down the customer satisfaction road, based upon a more customer oriented business philosophy.





Introduction

This research will address the concept of ?how to maintain a competitive advantage in the pharmaceutical business, based upon a market driven strategy??
This will necessitate analysis of the pharmaceutical industry in general and the impact of the external environmental factors in the gulf countries upon this industry, how different forces interact within this industry, and subsequently how these forces are driving pharmaceutical companies to differentiate their offering to their customers.


Having said this, next step will entail how Sanofi-Synthelabo is reacting to the market forces, in particularly the thesis will analyse the marketing initiative conducted by the marketing department of the company, the marketing mix for one of the company blockbuster product, and how other department (especially sales department) integrate marketing in their every day business,

A S.W.O.T analysis will then lead to identification of gaps between the current performance of the marketing department and the current business strategy, and the market driven strategy that thesis promote as a strategy for sustainable competitive advantage. The research will also focus on how to perform certain marketing function that can differentiate the company from its competitors i.e. strategic brand management


This research is motivated by the increased complexity in the competitive environment in the pharmaceutical industry, and is emphasising the concept of market orientation as a substitute for the traditional marketing concept of the 4ps.
Finally this thesis proposes a broader treatment of marketing integrating both its dimensions, strategic and operational. The thesis will address marketing function not only as an action-oriented process, but equally important as a business philosophy, that emphasizes the strategic choices upon which market driven management is based.


The key theories that going to be covered in this thesis are:

1-Macro-environmental analysis, evaluation for both external and internal factors affecting this company subsidiary in the Arab gulf area is going to be carried using both the PESTLE analysis and the 7Ss methods to identify to which degree the internal structure of the company fit with its external environment.


2- Competitive analysis. Using Porter analysis, the research is going to examine the role of different external competitive forces to San-Syn, and explain the importance of differentiation as a source of competitive advantage.

3-the role of the marketing in the firm and the different marketing philosophies (passive marketing, operational marketing and strategic marketing) and the limitations of each of these three different philosophies.

5- From marketing to market driven. And what are the implications of the market ?driven orientation on the marketing function of the company.

6- market-driven strategy development. This part is going to set the specific tasks to be performed by strategic marketing that entail identifying potential product segments on the basis of analysis of the customer?s needs which to be met, evaluating the attractiveness of the market, then evaluating the competitiveness level of Sa-Syn . And then on the basis of this strategic audit, a marketing strategy can be formulated for each business unit included in its product portfolio.

7- Change management theories




Proposed methodology
Primary data will be gained through a qualitative research will be conducted as Individual in-depth interviews (questionnaire-based interviews), with medical representatives, the sales managers and the product managers within the affiliate number to be interview will be from 15-20 individual. The aim of the interviews will be to identify the individual perception of different staff within the company regarding the marketing function within the organisation, and how effective this function is inside the affiliate.
Individual in-depth interviews are interviews that are conducted face to face with the
Respondent, in which the subject matter of the interview is explored in detail. There are two basic types of in-depth interviews. They are nondirective and semi structured, and their differences lie in the amount of guidance the interviewer provides.

In nondirective interviews the respondent is given maximum freedom to respond, within the bounds of topics of interest to the interviewer. Success depends on (1) establishing a
relaxed and sympathetic relationship; (2) the ability to probe in order to clarify and elaborate on interesting responses, without biasing the content of the responses; and (3) the skill of guiding the discussion back to the topic outline when digressions are unfruitful, always pursuing reasons behind the comments and answers.

Qualitative method was chosen since. Qualitative data are collected to know more about things that cannot be directly observed and measured like feelings, thoughts and intentions. In the same vein qualitative research is about to find out what is in an individual's mind. It is done in order to access and also get a rough idea about the person's perspective.





Secondary data
A thorough research of published literature will be used with resources such as books, journals, papers, Internet.


Reflection
This research is going to address the efficacy of the marketing function within the organisation, therefore some of the questions that going to be asked during the interviews Questions that they perceive as invasion of privacy, that they think will embarrass them, or that may have a negative impact on their ego or status will not be honestly answered.
On the other hand, changing the functional role of the marketing department will have a great influence on the way the business flow, not only on the marketing department but equally on the role of the sales department and the affiliate as whole. Therefore it is most likely that, this sort of change will necessitate a leader that can centrally influence different department and clear the path for new business orientation.

Conclusion
The presented research is addressing a more customer oriented business, in an affiliate for an international pharmaceutical organisation as a way of sustaining a competitive edge through changing the traditional view of the marketing function, to a more market driven view. Where every act the business initiates should create value in the marketplace and where every one in the organisation is a marketer, no matter how seemingly remote they may appear from the traditional marketing process.
After completions of the interviews, the next step will entail reviewing different literatures that analyse the role of the marketing function within organisations, and the concept of market driven management.



Company history
Sanofi was established in1973, when the oil conglomerate Elf Aquitaine merged several diverse companies into one subsidiary. Capabilities of the new company included healthcare, cosmetics and animal nutrition.
In 1979, Elf spun off Sanofi. From this point on the company grew through a series of acquisitions and alliances, including a joint venture with American Home Products (now Wyeth) in 1982.
Towards the end of the 1980s and into the 1990s, the company developed its cosmetics operations with the acquisitions of Nina Ricci, in 1988, and the perfume business of Yves St. Laurent, 1n 1993. Later in the 1990s, Sanofi began to divest its veterinarian and biotech operations. This was closely followed by its beauty division, which had begun to incur losses. Nina Ricci was sold in 1996 and by 1999, the rest of the division had followed suit.
In 1999, Sanofi merged with Synthelabo. Synthelabo was founded in 1970, from the merger of Laboratoires Dausse and Laboratoires Robert et Carriere. L?Oreal bought a 53% interest in the company in 1973. In 1980, the company bought the drug firm Metabio-Jouillie. Other acquisitions followed throughout the 1980s. There were also several joint ventures established, including those with Mitsubishi Chemical Industries and Tanabe Seiyaku. In the early 1990s, the company acquired several smaller French companies.
This gave Synthelabo the strength to compete in the big international markets in the US and Asia. Sanorania Pharma was bought from Pharmacia & Upjohn in 1997, before the Sanofi merger in 1999.
After 1999, Sanofi-Synthelabo began to reorganize itself into a pharmaceutical specialist. This resulted in the sale of its animal feed, diagnostic and veterianary interests. During 2000, the company targeted the US market, by increasing its sales presence. Furthermore, in 2002, the company enhanced its capabilities with an alliance with Immuno-Designed Molecules, a biotechnology firm that developed cancer drugs.
Also in 2002, The Food and Drug Administration (FDA) approved Eligard for the treatment of advanced prostate cancer, and obtained supplementary US patents for the Eloxatin and Elitek active ingredients.
The FDA also gave marketing approval in major indication extensions for Plavix in acute coronary syndrome and for Aprovel in diabetic nephropathy (kidney disease) in patients with high blood pressure and type 2 diabetes. In March 2003, the FDA granted ARIXTRA (fondaparinux sodium) a six-month priority review for the new indication Prophylaxis of deep venous thrombosis, which may lead to pulmonary embolism, in patients undergoing hip fracture surgery, including extended prophylaxis.

COMPANY OVERVIEW
Sanofi-Synthelabo is a drugs company, which specializes in four development areas that cover cardiovascular, central nervous system, oncology, and internal medicine formulations. For the fiscal year ended December 31, 2002, the company generated revenues of $7.0 billion, an increase of 15% over the previous year.
Sanofi-Synthelabo has a portfolio of around 50 compounds in development programs, around half of which are in phase II or III clinical trials. The company is well established in Europe and is attempting to capture the lucrative US and Asian markets. Sanofi is headquartered in Paris, France.



BUSINESS DESCRIPTION of the marketing department in the Gulf affiliate

Sanofi-Synth?labo offers a product range focused on a core group of four therapeutic areas. These areas include the Cardiovascular disease/Thrombosis segment; disorders of Central Nervous System, Oncology and Internal Medicine sectors. The company also operates in the fields of Consumer Health (OTC) Products and Generics.
Within the cardiovascular fields, it launched Aprovel (irbesartan) in 1997, in partnership with Bristol-Myers Squibb. Now marketed in more than 30 countries around the world, this marks the group?s development in the Hypertension field.
Plavix (clopidogrel), a platelet aggregation inhibitor, was launched in the US and Europe in 1998. A CAPRIE study involving over 19,000 patients suffering from first symptoms of atherothrombosis showed that it was apparently more effective than aspirin (the standard prescription). Sanofi entered the oncology field in 1996 with the launch of Eloxatin (oxaliplatine) in France. The product is registered in more than 50 countries. New compounds are under clinical investigation and others are in the launch phase, such as FASTURTEC.
Within the central nervous system field, the company?s Depakine, which has been in use for the past 30 years, is one of the world?s most-prescribed anti-epileptic medications. Another product in this field, Gabitril (Tiagabine), used for partial epilepsy, was prescribed to 14,500 patients during its launch year in 1998.
Urology, gastroenterology, allergy, respiratory disease, rheumatology, the muscular system and food metabolism are the main fields covered by Internal Medicine. Xatral
(alfuzosin) is indicated for benign prostatic hypertrophy, condition experienced by more than half of all men 60-years-old and over.
Sanofi possesses strong brands in the consumer health market, where products are either prescribed by a physician, recommended by a pharmacist, or purchased by consumers without a prescription.













Research results;
Interviewed staff
General manager 1
Product managers 4
National managers 3
Medical representatives  UAE: 4
 Kuwait: 4
 Oman : 2
 Qatar: 2
 Bahrain : 2


Total = 21 interviews were conducted
First question was about the main responsibilities of marketing in the affiliate
The responses to this question vary as follow;
General Manager associated marketing, with the followings; (new ideas generation, new opportunities, establishment of excellent relation with key opinion leaders in the field of medicine and supporting medical reps. in their duties.

National managers almost have the same response; all of them highlighted the responsibility of supporting medical reps. in their duties either through training sessions for the reps. or organising educational activities to the doctors. Furthermore national managers also associated marketing with the launch of new products (Kuwait manger), and the designing of the promotional materials used by medical reps. (U.A.E manager).

As for the product mangers
All product managers identified S.T.P (segmentation, targeting and positioning) as the core functions of the marketing department. However all of them didn?t associate their daily work with these concepts, and responded that most of their work are related to allocation of investments to certain educational events to customers (round table meetings, medical symposia and international medical conferences) and training sessions to medical reps. Furthermore all of them agreed that they contribute in the process of promoting the drugs when they join the medical reps, when the medical reps are
Incompetent to transfer the message they are requested to. In the same vein product managers felt that one of their main responsibilities are to keep close contact with K.O.Ls, and to convince the G.M regarding the investments allocated to each of them.

Last but not least, product managers highlighted the responsibility of collecting market data regarding the size of the different therapeutic segments, through questionnaires that are given to the medical reps, to be handed to the concerned doctors.

One product manager (among the four) regarded the annual marketing plan that are prepared each year to be sent to France head quarter at September, as a serious responsibility, for the others, they were taking the annual plane as an administrative job , since they agreed that these planes were never taken seriously by France head quarter.



As for the medical reps; all of them highlighted two roles for the marketing department. First the training sessions conducted to them by the product managers fro products medical knowledge and the round table activities that are conducted to doctors.
Medical reps in Kuwait and U.A.E ( the biggest two countries among the five countries) especially highlighted the need for marketers to develop relationship with key opinion leaders and other important non prescribers as purchasing department in ministry of health and medical store personnel in the ministry.

On the other hand, Medical reps in Qatar and Oman, indicated that the marketing department?s responsibility is to support them (with medical information and tactics) in order to help them to have this kind of strong relation with K.O.Ls.


Second question;
Addressed the effectiveness of the marketing function within the affiliate

The general manger responded to this question, that the marketing initiatives, that are requested from France office, to be implemented in the Gulf, are still not accomplished e.g. identifying the size of segments to be targeted for each product. However he did appreciate the support giving to the medical reps by the marketers in the affiliate.
He also addressed the need for creative ideas to be implemented by the product managers, without mentioning the nature exactly of what he meant.


As for the national managers, the respond varies from one to another;
For U.A.E manager , he appreciated the role played by the product managers in the educational activities, on the other hand he felt that allot of the questionnaires that are giving to the med reps in order to survey an incidence or prevalence of a diseases or in order to have key account data base, were some how ineffective and are not helping in better sales for the company, in the same vein U.A.E manger stated that he never ( not even once) read the marketing plans prepared annually by the product managers .


For Kuwait manager, he stressed the fact the product mangers are adding value to the company, mainly through the training sessions they are conducting for the medical reps.
Since the regional office of the Gulf countries is in UAE, he explained that K.O.Ls management is mainly done by him and his team in Kuwait and that the role played by the marketing department regarding this function, is minimal and should be improved.






For the third national manager of (Oman, Qatar and Bahrain)
He felt that the market department is very effective in both supporting his team, with the training sessions they are conducted for product knowledge, and for the level of relationship , the marketing department developed with K.O.Ls doctors in his countries. Furthermore he requested improvement in communication between him and the market department.


For product mangers
All of them complained from allot of administrative working. In addition they felt that there is no enough time for them to analyse their market or to plan for future activities. All of them agreed that , most of their time they are responding , either to requests from the medical reps to solve certain problems in the market , or to requests from the marketing director in France , who does not involve him self allot in understanding the nature of the market , they are operating in.


For the medical reps
Medical reps in U.A.E were the responders who felt allot of support from the marketing department, in different activities i.e. helping them in improving relation with doctors in key accounts, supporting them in understanding their market and how to deliver a proper message to the target doctors.
In Bahrain and Oman, medical reps also appreciated the kind of support; they are receiving from the product mangers, especially in allocating investment to certain marketing functions in their countries.

On the other hand both Kuwait and Qatar medial reps. complained from insufficient support from the marketing department, they felt that most investment decisions were taken without their participation in making those decisions, and therefore they felt that most of investments that took place were misplaced, because of misunderstanding of the market department to Kuwait market.














Macro-environmental analysis

Introduction
PESTLE analysis is a useful framework that gives structured insight into what are the changes occurring in the organization?s general environment (Leicester2604. P, 1.46)
A PESTLE analysis will be carried out to SANOFI~SYNTHELABO subsidiary in the Arab gulf countries (UAE, Kuwait, Oman, Qatar and Bahrain) in order to analyse different factors that can influence the performance of SANOFI , in response to its external environment.

P stands for political factor
The political system in the gulf countries allows international organization to exist inside their countries, only under the umbrella of a native pharmaceutical agency, where part of the company revenue, goes to the agency, and in return this agency is expected to provide the company with strong level of connection within the country which can facilitate the activity of the company and the distribution of its goods. Therefore it is one of the important elements to the pharmaceutical companies in the Gulf States, to have a strong support from its native agency , in order to have better opportunities for its activity base on the level of support it receive from this agent.

Recently all of the gulf countries have decided to restrict free medications within its ministry of health hospitals (the big institutional hospitals), only to native individuals. This policy has restricted expatriates from receiving their medications from the institutional sector. Accordingly most of the pharmaceutical companies started to suffer from reduction in both, the consumption and subsequent ordering for its products from the ministry of health?s hospitals.
Nevertheless this was partly compensated by increasing request for medications in the private sector. This is the main reason why many pharmaceutical companies have started to shift its field force to the private sector and the private health insurance hospitals, in order to compensate their loss in the institutional sector.

The political system is also supporting two local pharmaceutical companies (Gulphar & Global) as there is a preferential treatment for these two companies i.e. through awardation of major contract of ministry of health to them in their line of products.



E refer to economic
Gulf countries saw very strong growth during the second half of the 1970s (8.6 per cent) (1975-1980), followed by a sluggish economic growth at 1.2% during the period 1980-2000.(United nations developmental programme2002.P,92) Figure 6.1 illustrates the pattern over time and shows that the overall trend was downward over the period as a whole. The fluctuating economic growth pattern seen in the gulf countries reflects mainly movement in the oil market on which mainly it strongly depends. This overall down trend has the affected the pharmaceutical industry in this area of the world by two ways;
First a very aggressive price regulation was stressed over the last few years among the Arab gulf countries which resulted in squeezing of the profit margin of most of the companies, and secondly the over all health care system?s expenditure on drugs ( specially new innovative drugs with premium price ) was reduced.






S refer to social
The Gulf countries has become a home to substantial expatriate population, reflecting a combination of the oil boom and domestic labour shortages, the number of the foreign workers in the gulf countries increased fivefold from 1970-1990 , expatriate are estimated to constitute over two third of the population in the gulf countries (UNDP 36)
Age Structure in the gulf countries is significantly younger than the global average, with about 26 % of the population under the age of 15.
the dependency ratio ( the ratio of economically inactive to the working age population, defined as those 15 to 64 years of age) are lower in the gulf countries than else where in the Arab world , owing to the presence of a large numbers of foreign workers.
Further more it is estimated that the proportion of the population age 65 or older will increase in the gulf countries to up to 9 % in 2020.
(United Nations developmental programme2002.P 38)

These key demographic dates can have the following impact on the pharmaceutical industry in the gulf countries:
 Majority of the population in these countries are expatriates, most of them are Asians with low income that can weaken their demands for medicines especially brands with premium prices.
 There is a good trend in the future, with increasing the proportion of the native elderly in the population and consequently increase the need for medications for this age group.


T stands for Technological
Arab countries have some of the lowest level of research funding in the world, according to the 1998 world science report of the United Nations educational, scientific and cultural organization (UNESCO). R& D expenditure as a percentage of GDP was a mere 0.4% For the Arab world in 1996 compared to 2.35% in 1994 for Israel as an example for comparison. (United Nations developmental programme2002.P, 65)
Despite the fact that technological changes are not expected to take place swiftly in the region and consequently local pharmaceutical companies will not have the competencies to compete against international companies like Sanofi~Synthelabo, still local pharmaceutical companies started to compete versus internationals , by manufacturing and selling drugs that become out of patent protection ( saving the huge budget of R& D) and providing much cheaper prices compared with the original brands produced by the internationals.


L stands for Legal environment
Legal dimensions in the Gulf countries don?t differ significantly from that of the developed world. The government has set of regulations in order to control the behaviour of the pharmaceutical industry. i.e. Legislation governs the rights of employees, it governs the way pharmaceutical companies can market its products ( code of ethics). Furthermore it sets out standards that must be embodied in the products provided by the company (through quality control and sample analysis for any medicine).
The legislative arm of the government also plays a role in pricing medicines and assuring the rights for the patients receive an honest data about the medicine from the company of manufacture in case he or she requests to have them.

In order to keep a sound relation with the government, it is important for the pharmaceutical companies to be aware of the legislations of each particular country and to run their activities in line with these regulations.






E stands for environmental or Ethical consideration
In the late twentieth-century urbanization created major air pollution problems in the Arab countries as a whole. The transport, industrial and energy sectors have had substantial effect on the environment (United Nations developmental programme2002.P, 45). Now there is a growing awareness of the community toward the environmental effect of the products and services. Sanofi~Synthelabo is giving a great deal of attention to the environmental and safety issues, there is no pharmaceutical manufacturing facility for the company, nevertheless still the gulf subsidiary is compliant with the policy of Sanofi~Synthelabo regarding this issue .This policy is the work of the HSE (health, safety and environmental) department within the company and it can be summarized as follow;
 1-In all the places in which the group operates it respects the applicable laws and regulations, applies expert recommendations and uses best industrial practices.

 2- Every product launch will be subjected to a safety, health and environmental risk assessment integrating all the scientific and technical knowledge of the group.

 Sanofi~Synthelabo takes care to minimise consumption of raw materials and energy and monitor and control gaseous emissions, aqueous effluents and solid waste
(Environnemental report 2002 Sanofi~Synth?labo 2001. P, 27)

Conclusion
The Arabic region especially the Gulf area is showing tremendous changes affecting all aspects i.e. politically, few local pharmaceutical manufactures are starting to build up the technology required for survival in this industry; furthermore these companies are receiving favourable treatment from the health authorities in these different countries, putting international pharmaceuticals in more fierce competition versus these local industries.
On other hand the fluctuating economic growth pattern, have reduced the health system budget, and exerted a lot of pressure on the pricing policy of a lot of pharmaceuticals.
Last but not least aging of the population will constitute an opportunity for companies producing drugs for this segment.





























Industry analysis
Porter 1982, has determined the forces that drive any industry competition, his analysis is based on the idea that a company?s ability to exploit a competitive advantage in its reference market depends not only on the direct competition it faces, but also on the role played by rival forces , such as potential entrants , substitute products, customers and suppliers. The first two forces constitute a direct threat; the other two an indirect threat, because of their bargaining power. It is the combined interplay of these five competitive forces which determines the profit potential of the product market.




Figure: Porter?s Five Forces Model
Source: Porter (19800.







Using this framework to analyse the competition in the pharmaceutical industry

Threat of new entrants

The threat of new entrants in the pharmaceutical industry is minimal, since barriers to entry constitute a big challenge for any new comer. The main barriers are:

1- Capital requirements , which can be considerable , not only for production facilities, but more important for R& D investments that is crucial for the success of any pharmaceutical firm to succeed , marketing expenses and so on . Introducing a single drug can cost from $ 600 million to $1 billion from conception to launch. The average product can takes up to 15 years to develop.

2- Economy of scale and economy of scope, to an industry afflicted with excess production capacity. The logic of combining operations has been compelling enough to generate more than $150 billion of mergers and acquisitions among pharmaceutical companies in the last six years in order to achieve economy of scale and economy of scope.


3- Legal protection obtained through patents, is also another entry barriers that minimise the entry of new entrants.












Threat of substitute products
Substitute products are products that can perform the same function for the same customer groups, but are based on different technologies.
Substitution in the pharmaceutical industry were seen during the last ten years, especially in the cardiology field, where most of the heart beat irregularity diseases
(Cardiac arrhythmias) were treated with pharmaceutical products as a first line of therapy,
Recently pharmaceutical product?s role has been so much weaken, after the introduction of new technology i.e. I.C.D (Intra cardiac defibrillators) that becoming increasingly encouraged as a first line of therapy instead of drugs.
However, special attention has to be paid to switching costs (real or psychological), which is very high, and can offset the total replacement of anti arrhythmic drugs with I.C.Ds. Therefore with advanced technology it is foreseen that the medical equipment industry can represent a threat to pharmaceutical products in certain specialities of medicine.


Bargaining power of buyers
Unforgiving health regulatory regimes have put a lot pressure on pharmaceutical prices and have reduced the profit margin of firms within this industry. Brands with premium prices have to be endorsed by key opinion leader doctors, who influence the purchase of such products, and the practice of other doctors.
Furthermore medical associations either internationals or locals can influence to great extent the prescription habit of physicians and consequently the sales of a given pharmaceutical product. Medical guidelines and recommendations have always been one of the major drivers of any pharmaceutical product.
Recently with the era of the internet and the easiness of access to information regarding pharmaceutical products and pharmaceutical companies, has empowered end users i.e. patients role in choosing their medicine, and is becoming more and more important.
A well informed patient is increasingly becoming a decision maker regarding which drug to use.



Bargaining power of suppliers
Suppliers can exert bargaining power in the pharmaceutical industry either by rising prices of their raw materials or through reducing quality. This has lead to vertical integration within the pharmaceutical industry, where vertical integration for a big pharmaceutical company may therefore amount to acquiring or collaborating with a biotech company to obtain enabling technologies or to enrich its own R&D pipeline. In the case of the acquisition of a biotech company, the acquired research will very probably be non-overlapping with the in-house research, so that research at the sites of acquired company can continue as it is for the time being. Later, it can be tailored and pruned according to the needs of the acquiring company.


Rivalry among existing firms
The intensity and form of competitive struggle between direct rivals in a product market vary according to the nature of the actual competitive structure. This defines the degree of interdependence between rivals and the extent of the market power held by each competitor.
The pharmaceutical industry is characterized by being a very fragmented industry, recently mergers and acquisitions has led to a significant shift in the balance of power across the pharmaceutical industry, creating a number of ?mega-companies?. For the first time, take-over bids were completed amongst major companies, including Pfizer with Warner- Lambert, Pharmacia & Upjohn with Monsanto and Glaxo Wellcome with SmithKline Beecham. If other expected mergers go ahead, even larger entities could be created.


That factors that have been identified as driving companies to seek alternatives beyond organic growth, include:
 Slowing sales growth
 Cost containment is key on customers? agenda due to pressure on drug budgets
 Renewed emphasis on pharmaco-economic evidence, given the drive to meet budget constraints
 Shorter life-cycles of new compounds
 Scarcity of ?blockbuster? drug compounds.
 Higher costs of drug discovery technologies.
 Increased price competition and marketing spend required to combat:
o Patent expiries
o Generics
o Parallel imports


Still the opportunity for consolidation in this diffuse industry is very high, since the market share of the leading pharmaceutical company Pfizer constitutes only 7%.

However it should be considered that the competition between pharmaceutical companies is determined mainly by the therapeutic category, such as antihypertensive drugs, anti thrombosis drugs and so on.
Different therapeutic categories may show different competitive structures, for example the therapeutic class of anti cholesterol drug is an oligopolstic market where the number of competitors is low (Pfizer, Novartis, BMS and recently Astra Zeneca) and the degree of differentiation between the products is high. As a result rival firms in this class are highly interdependent, each firm knows well the forces at work and the actions of one firm are felt by the others, who are inclined to react. Therefore the outcome of a strategic action depends largely on weather or not competitor firm react.




Conclusion
The pharmaceutical market is sill a fragmented market, with more opportunities for consolidations through further mergers and acquisitions. The creation of mega companies will enable them to exploit economy of scale and of scope, and will give them a competitive edge with the size of investment they will afford to allocate to R&D.
However on the other hand, companies like SANOFI-SYNTHELABO, are having the chance to differentiate them self versus mega companies like Pfizer, through trying to identify strategies with more customer orientation. This will entail a genuine focus on the strategic aspect of the marketing function within the company, and how efficient the company will diffuse this customer orientation through its hierarchical structure.



Internal audit of SANOFI-SYNTHELABO (GULF)
Introduction,
The 7S framework is a useful framework for carrying out an internal audit of the organization, it forces one to audit an organization from all perspectives both hard (strategy, structure and systems) and soft (style, staff and shared values).
It was the first framework to incorporate resources and distinctive competence (skills of the organization). (Leicester2604.P, 1.51)

Carrying out a 7S analysis for Sanofi-Synthelabo in the gulf subsidiary will yield the following:
Strategy
The strategy in the Gulf subsidiary, is concerning the strategic initiatives and approaches to manage this geographical area which includes five small countries (UAE, Kuwait, Oman, Qatar and Bahraini), and for handling daily operating tasks with strategic significance (Operating strategy).
These strategic initiatives may include decisions regarding;
 how to strengthen the company long term business by recommending certain company products to be marketed in the area according to the market need and deletion of certain products that are not profitable within this area
 how to achieve competitive advantage via allocation of the company resources including man power among the five countries according to the size of market and the potentiality of each market in the future.
 How to achieve the performance targets by providing the subordinates with action plans and monitor their performance with a reporting system in order to take corrective measure when needed.




Strategy is determined according to the area manager own thoughts and assumptions for this area of the world (strategy as thinking) (Leicester 2604.P, 1.17), moreover there is a relatively good feedback loop between the subordinates (the medical representatives and functional managers) and the area manager which influence the strategic decisions made by him. Thus a learning school of strategic decision process (leicester2604.P, 1.18) can be seen as well, especially in defining the quality of service needed for the customers (doctors & pharmacists). Finally the environmental factors like regulations of the gulf countries and the economic status also direct the strategic decision making process.

To conclude the strategy present in Sanofi~Synthelabo gulf subsidiary is basically
(A growth strategy) aiming toward communicating the uniqueness of the company products to its prospect to maintain a quality differentiation for its products in the mind of its prospects and continue to grow both in market share and revenue, this is implemented through;

 Training field force that is able of providing quality service to its target customers.
 Allocation of resources among the company products & among the different countries in the area.


Structure




Sanofi ~Synthelabo is having a vertical functional structure (Daft.P,316) with much defined line of authority where medical representatives of each country report and held accountable to one national manager , who in turn report to the area manager, further more also the medico-marketing department is reporting to the area manager directly.
 Line authority flows down this hierarchy form the position of the area manager, down to the supervisors and finally to the medical representatives.

 The medico-marketing department is having both staff authority and functional authority (Leicester 2600.P, 7.28) over the national managers and the medical reps.

there is a wide span of control with each national manager responsible for all medical reps within each country ( average 5 reps /country ) and one national manager is responsible for the medical reps of three countries ( Oman, Qatar and Bahrain) .

Decision authority is located at the top of the chart i.e. the area manager, giving the company a highly centralized structure with low level of delegation to the subordinates. The area manager has an autocratic style of leadership (Leicester2600.P, 7.32).

Analysing the mentioned structure, can show that the, level of coordination between the marketing department and the sales department is very poor. Product mangers are not allowed to view the daily reporting from the sales representatives, and market feed back data are mainly gained through joined visits with the sales reps, furthermore the higher manager is also promoting a sense of autonomy within each department, and in the same time he is not acting as a point of link between the different department. Therefore allot of opportunities are not cessed and the response of the company to the market and the customer?s requirement are some how slower than the competitive companies.


Systems
Sanofi~Synthelabo in the gulf is having a formal procedures through which it operates on daily basis.
The financial system records all expenses regularly and identifies expenses to its related activity and related products, in order to give an update view regarding the resources allocated to each country, each product and each activity. Thus resources are properly allocated among the different activities of the company.

The company also having a budgetary system, which is set annually .This system, helps to allocate resources to different products within each country according to the projected sales of each country.
Other systems which exist inside the company is the reporting system and the operational system, where the medical reps are given certain procedures in performing their work, then each medical rep has to perform a written daily report to his supervisor detailing his daily visits and providing feed back from the market.
Recently many medical reps have commented that these reports are time consuming and that it concentrates on performance rather than achieving tasks.
Finally the rewarding system inside the company is based on a financial incentive, where the medical reps are evaluated according to two main criteria; first achievement of individual targeted sales and second achievement of the whole country sales.
As for the product managers and the national managers, a monthly report is submitted to the general manager with the main activities conducted during the month and the plan for the next month activities. It is worthy to mention, that at this point, the product managers are having an access to all the national mangers reports.






Style
The general manager in Sanofi-Synthelabo gulf, depend mainly on command and control with little or no participation from the supervisors or the medico marketing department.
This centralization is always accompanied by a consultative type of authority to limit its severity. As for national managers and the marketing seniors, they are more people oriented as they are in direct contact with the medical reps and therefore they represent the link between the field force and the general manager.


Staff
Sanofi~Synthelabo in the gulf is considering training of its medical representatives as a continuous process, furthermore hygiene factors (Daft. P, 540) like good offices, the pay system and stability in the company are all available.
Motivation is related to a monetary incentive scheme with an appraisal prepared by the area manager, furthermore the loyalty and the commitment present among the subordinate is moderate at the best estimate, since most of the time the appraising system is subjective and depends on the personal feeling of the general manager toward the subordinate.













Skills
Management of product
The first skill that Sanofi-Synthelabo does well in the gulf is the degree paid to product knowledge, since this is seen in every activity the company performs. Further more this skill is present among all the level of the organization hierarchy up to the area manager.
Another skill which the company perform it relatively good is the way it manages its products, there are three lines of product within the company, each line is a responsibility of one marketing senior, further more there a marked coordination between the marketing individuals. Thus products management is based on two concepts; first growing the product to its highest potential and second utilizing all the company products directed to one prospect, to improve the company image and create a sense of partnership between the doctor and the company.


Shared value

In order to understand the shared values of Sanofi-Synth?labo as a group, a little detailing of its history will be necessary to explain the origin of these values.
Basically Sanofi-Synth?labo had created after a merge took place between two small French companies, during the period from 1998 till the present time the company succeeded to be one of the 20 largest companies in the pharmaceutical industry worldwide, ranked number seven in Europe and second in France.

This growth did not alter the values presented in the two small companies at the time of the merge. Both companies did not offer the best monetary package in the pharmaceutical field (not even close), but there was always a sense of family spirit that was easily to be felt between the staff of the company at all levels, this was helped by the average size of each company alone which created an emotional bond between the employee of the company, that by some how was seen as a compensation for the low monetary package.


The best example to show the shared value (people come first) inside the organization, is that when the merge took place in 1999 non of the employee of the new company was laid off, which was not the case with many other mergers at the time
( Glaxo-wellcome had laid off thousands of its employee by the time it merged).

Wright Company employs a computer-based data processing system for maintaining all company records. The current system was developed in stages over the past 5 years and had been fully operational for the last 24 mos. When the system was being designed, all department heads were asked to specify the types of information and reports they would need for planning and controlling operations. The systems department attempted to meet the specifications of each department head. Company management specified that certain other reports be prepared for department heads. During the 5 years of system development and operation, several changes have taken place in the department head positions due to attrition and promotions. The new department heads often made requests for additional reports according to their specifications. The systems department complied with all of these requests. Reports were discontinued only on request by a department head and then only if it was not a standard report required by top management.
As a result, few reports were discontinued. Consequently, the information processing sub-system was generating a large quantity of reports each reporting period. Company management became concerned about the quantity of report information that was being produced by the system. The internal audit department was asked to evaluate the effectiveness of the reports generated by the system. The audit staff determined early in the study that more information was being generated by the information processing subsystem than could be used effectively. They noted the following reactions to this information overload:

1. Many department heads would not act on certain reports during periods of peak activity. The department heads would let these reports accumulate with the hope of catching up during subsequent lulls.

2. Some department heads had so many reports they did not act at all on the information, or they made incorrect decisions because of misuse of the information.

3. Frequently, actions required by the nature of the report data were not taken until the department heads were reminded by others who needed the decisions. These department heads did not appear to have developed a priority system for acting on the information produced by the information processing subsystem.

4. Department heads often would develop the information they needed from alternative, independent sources, rather than use the reports generated by the information processing subsystem. This was often easier than trying to search among reports for the needed data.


Instructions:

1. Indicate whether each of the foregoing 4 reactions contributes positively or negatively to the Wright Companys operating effectiveness. Explain your answer for every one of the 4 reactions.
2. For each reaction that you indicated as a negative, recommend alternative procedures the Wright Company could employ to eliminate the negative contribution to operating effectiveness.

Assignment 1: Preparing a Comprehensive Case Analysis, Part 1
Due Week 4 and worth 200 points Research a public corporation that you believe is not doing as well as it could in the marketplace. For this first paper, you will complete the first steps of a comprehensive written analysis as described in Part 6 of the textbook. The written analysis will be completed in the second written assignment in this course. Write a 4?5 page paper in which you:
Identify the firm's existing objectives and strategies.
Explain one (1) strategy that the company might use to take advantage of an external opportunity, and one (1) strategy that the company might use to address a potential threat.
Construct a Competitive Profile Matrix. Include the company you are researching and one or two (1 or 2) of its major competitors and at least six (6) success factors that you believe to be critical to success in this industry. This Matrix should follow the format of the examples in Chapter 3.
Construct an External Factor Evaluation Matrix. This Matrix should follow the format of the examples in Chapter 3.
Research and cite at least three (3) reputable, academic sources.
Your assignment must follow these formatting requirements:
Be typed, double-spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.
Include a cover page containing the title of the assignment, the student?s name, the professor?s name, the course title, and the date. The cover page is not included in the required assignment page length.
The specific course learning outcomes associated with this assignment are:
Explain the concepts and models of the strategic management process, including strategy formulation, implementation, and evaluation.
Conduct an industry analysis (external audit) and an internal audit of an organization, and present the results using various matrices and analysis tools.
Use technology and information resources to research issues in business policy.
Write clearly and concisely about business policy using proper writing mechanics.

Corporate Compliance Plan

Resource: Riordan Manufacturing
Create a Corporate Compliance Plan of no more than 10 pages for Riordan. The plan must synthesize your learning and apply legal principles of business management. Focus your plan on managing the legal liabilities of Riordan officers and directors.

Address the following in your plan:

ADR
Enterprise and product liability
International law
Tangible and intellectual property
Legal forms of business
Governance

Create your plan as if you were distributing it to officers and directors.

Outline prevention and management guidelines of aspects listed above. Use previous individual assignments to bring insight to this project.

Implement enterprise risk management based on Committee of Sponsoring Organizations of the Treadway Commission (COSO) recommendations, which may structure your plan. Incorporate key concepts from your readings as needed.

Address specific laws or aspects Riordan must adhere to and outline steps for employees to adhere to them. The plan must also address how to handle situations when laws are violated or in question, such as when to call in legal counsel, what rights employees have, or who to turn to when actions are taken against Riordan.

Format your plan according to APA standards.


Riordan Manufacturing recognizes that being a global plastic producer involves significant legal and ethical responsibility. This responsibility extends not only to their consumers, but also to the many companies and agencies Riordan works with, as well as fellow employees, and indeed, the public at large.
The following Compliance Plan was adopted as a guide for each employees conduct so that Riordan may fulfill its obligations to observe the laws and public policies affecting its business; and to deal fairly with Riordan employees and communities it operates in.
This Compliance Plan will contain resources to help resolve any question about appropriate conduct in the work place, as well as provide guidance which will ensure that our work is done in an ethical and legal manner. For the Compliance Plan to be effective, it must have the cooperation of all employees. Your adherence to its spirit, as well as its specific provisions is absolutely critical to Riordans future.

Directives for Key Personnel
The effectiveness of the Compliance Plan depends largely on the leadership efforts of key personnel at Riordan. The officers and directors of Riordan must ensure that those on their team have sufficient information to comply with the laws, regulations, and policies, as well as the resources to resolve ethical dilemmas. It is the responsibility of the key personnel to create a culture within Riordan which promotes the highest standards of ethics and compliance; Riordan expects its leaders to set an example and be in every respect a model. We must never sacrifice ethical and complaint behavior in the pursuit of business objectives. The key personnel of Riordan will be held responsible for ensuring and accomplishing the following goals:

Maintain compliance standards and procedures reasonably designed to reduce the risk of criminal conduct and other violations
Never to delegate discretionary authority to any individual whom it knows, or through the exercise of due diligence should have known, had a propensity to engage in legal activities.
Always to take reasonable steps to communicate effectively in order to achieve compliance for all employees, consumers, and companies and agencies Riordan works with.
Implement and maintain monitoring and auditing systems that are reasonably (without the fear of retribution) designed to detect unethical/wrongful behavior or criminal conduct by employees and other third parties that Riordan works with.
Cooperate to the fullest extent reasonable and practical with appropriate federal, state, and local authorities investigating a potential violation of law; never to conceal, destroy, or tamper with evidence.

Reporting Potential Compliance Plan Violations
It is Riordans desire for the Compliance Plan to aid in the identification and correction of any actual or perceived violations of any applicable rules and regulations. In order to attain this goal, the Plan imposes a duty on all employees to report to designated individuals listed below.
1. Compliance Officer ??
2. Director of Human Resources ?? Yvonne McMillan ([email protected] )
3. Safety Manager ?? Chad Sterkin ([email protected] )
4. Employee Relations Manager ?? Andrea Gamby ([email protected] )
Corporate Compliance Officer - responsible for overseeing the Corporate Compliance Plan; reviewing agency policies and procedures, recommending changes or new policies and procedures; overseeing administration of agency risk assessment relative to Compliance issues and recommending changes in procedures as a result of Risk Assessment; developing and implementing internal audit procedures relative to Corporate Compliance issues; maintaining a library of regulations, agency policies and procedures; Overseeing the implementation of Corporate Compliance training program, including conducting of training sessions for staff; investigating matters related to Corporate Compliance issues, including employee, consumer, and/or payor complaints; developing and implementing employee feedback loop which encourages employees to report potential problems without fear of retaliation (CCP, 2009).
Director of Human Resources ?? Develops policy and directs and coordinates human resources activities, such as employment, compensation, labor relations, benefits, training, and employee services (Riordan, 2004).
Safety Manager ?? Plans, directs and implements organization safety program to ensure safe, healthy, and accident-free work environment (Riordan, 2004).
Employee Relations Manager ?? Supervises employee-related programs, manages resolution of employee relations problems and develops new employee-related programs (Riordan, 2004).

Procedure for Potential Compliance Violations
Riordan expects all employees to report potential violations/irregularities of the Compliance Plan in writing or via internal e-mail system; Riordan will maintain confidentiality of the reporter to the extent permitted by law. The Compliance Officer shall receive copies of all reports within 24 hours of the incident. The Compliance Officer will review each report and notify the President, Dr. Michael Riordan, and Chief Legal Counsel, Lowell Bradford of any allegations of criminal wrongdoing. The Compliance Officer and the Chief Legal Counsel will determine whether the alleged wrongdoing is a violation of a law. To prevent the risk of economic injury and to protect Riordans reputation the Compliance Officer in conjunction with the Chief Legal Counsel and President shall take an action to commensurate the gravity of the allegation to determine if the allegation is valid and what corrective actions should be imposed.

Employee Disciplinary Procedures
The Office of Human Resources, in conjunction with the Compliance Officer will implement an effective, uniform disciplinary program to prevent violation of the Plan and to discipline employees who fail to detect or fail to report detected violations. The major purpose of any disciplinary action is to correct the problem, prevent recurrence, and prepare the employee for satisfactory performance in the future. Although employment at Riordan is based on mutual consent, both, Riordan and the employee have the right to terminate employment at will, with or without case or advance notice (Riordan, 2004).
Disciplinary action may call for any of 4 steps (possible bypass of one or more steps):
1. Verbal warning
2. Written warning
3. Suspension with or without pay
4. Termination of employment

Here are some examples of violations of the Compliance Plan that may result in one or more disciplinary action mentioned above:
Negligently or intentionally providing false or misleading information to Riordan, its key personnel, and other third parties that Riordan is working with
Negligent or intentinal violation of any federal, state, or local law regulation
Failure to report another employees conduct which violates any law or regulations
Failure or refusal to cooperate with any Riordans investigation
Engaging in any other conduct which fails to comply with the duties and prohibitions, expressed or implied, set forth in the proposed Compliance Plan for Riordan
In the case of officers and directors of Riordan:
Failure to exercise adequate supervision of subordinate personnel where such failure leads, directly or indirectly, to a compliance incident
Direct and indirect retaliation against any employee who in good faith reports a compliance incident

Employment Policies
Riordan is committed to employing only United States citizens and aliens who are legally authorized to work in the United States, however do not unlawfully discriminate on the basis of citizenship or national origin (Riordan, 2004). Under the Title VII of the Civil Rights Act of 1964, Equal Pay Act of 1963, Age Discrimination in Employment Act of 1967, Title I and Title V of the Americans with Disabilities Act of 1990, Sections 501 and 505 of the Rehabilitation Act of 1973, and Civil Rights Act of 1991 Riordan strongly supports equal employment and advancement opportunities for all persons without regard to race, color, religion, sex, national origin, age, disability or any other status protected by the law (EEOC, 2009). Any issues or concerns about any type of discrimination in the workplace are encouraged to be brought to the attention of any supervisor or the Human Resources Director - Yvonne McMillan ([email protected]). Further, anyone found to be engaging in any type of unlawful discrimination will be subject to disciplinary action, up to and including termination of employment (Riordan, 2004).

Sexual and Other Unlawful Harassment
Riordan is committed to providing a work environment that is free from all forms of discrimination and conduct that can be considered harassing, coercive, or disruptive, including sexual harassment. Actions, words, jokes, or comments based on an individual sex, race, color, national origin, age, religion, disability, sexual orientation, or any other legally protected characteristic will not be tolerated. Any concerns about Sexual and other Unlawful Harassment can be raised without the fear or reprisal or retaliation. Confidentiality of any witnesses or the alleged harasser will be protected to the fullest possible extent (Riordan, 2004).

Compliance with Environmental and Safety Laws
The Occupational Safety and Health Act (OSHA) is a top priority at Riordan. Employees and supervisors receive periodic workplace safety training which covers potential safety and health hazards and work practices and procedures to avoid or eliminate hazards (Riordan, 2004). All employees are expected to obey all safety rules and use caution in their work activities. Any questions or concerns regarding occupational safety must be addressed to Riordans Safety Manager ?? Chad Sterkin ([email protected]). In the case of a legal claim matter, including Alternative Dispute Resolution such as mediation and negotiation, please forward all correspondence to the law firm representing Riordan - Litteral & Finkel.

License and Certification Renewals
All Riordan employees, as well as individuals retained as independent contractors, in position which requires licenses, certifications, or other credentials are responsible for maintaining the current status of their credentials and shall comply at all times with Federal and State requirements applicable to their respective job assignment. To ensure compliance, Riordan will require evidence of current license and credential status.

Security Breaches
At Riordan we consider security breaches very serious. No employee shall disclose or permit the disclosure of, or discuss any proprietary Riordan information data. In case of improper use, disclosure of trade secrets or confidential business information an employee will be subject to disciplinary action, up to and including termination of employment and legal action, even if such breach was unintentional (Riordan, 2004). Confidential information is vital to the interests and success of Riordan. The following examples of confidential information include but not limited to:
Sales Data
Compensation Data
Customer Lists
Financial Information
Marketing Strategies
New Materials Research
Pending Projects and Proposals
Proprietary Production Processes
R&D Strategies
Scientific Data, Formulae, Prototypes
Technological Data and Prototypes

Integrity of Financial Reporting
Under the Sarbanes-Oxley Act of 2002, Riordans management shall ensure that assets and liabilities are accounted for properly in compliance with all tax and financial requirements and saved for at least 5 year period (SearchCIO, 2009). Management shall also ensure that no false or artificial Riordans records are made, and that there are no unrecorded Riordans assets. All Riordans reports of income, expense, assets and liabilities submitted to the governmental authorities shall be accurately made, all transactions shall be executed in accordance with managements authorization, and access to assets shall be permitted only in accordance with such authorization. Any employee who knows or has reason to believe that a transaction is not recorded in compliance with the above requirements shall promptly report such matter to the Director of Accounting and Finance ?? Donald Bryson ([email protected]).

International Business Practices
In the global economy today, Riordan may encounter standards of conduct in business affairs of other nation that differ dramatically from those of the United States. Riordan expects all employees conducting business in China to comply with the local code and laws. No fee, commission, bribe or other thing of value shall be directly or indirectly made, offered, or paid to any elected, appointed, or ruling foreign government official, head of state, or political party for the purpose of influencing any decision within the influence of such official or head of state. Furthermore, no Riordan employee may make any improper payment to any official or employee of any foreign government, or any foreign commercial non-government customer.

Integrity of Business Practices and Adherence to Code
The successful business operation and reputation of Riordan is built upon the principles of fair dealing and ethical conduct of our employees. Riordans continued success is dependent upon its customers trust; all employees owe a duty to Riordan, customers, and shareholders to act in ways that will merit the continued trust and confidence of the public.
This Compliance Plan has been carefully designed to ensure that Riordan will comply with all applicable laws and regulations, and it is expected of the top management, directors, officers, and employees to conduct business in accordance with the letter, spirit, and intent of all relevant laws and to refrain from any legal, dishonest, or unethical conduct. The design of the proposed Compliance Plan has been structured in a way that it can accommodate possible compliance law changes. This document contains confidential and proprietary information and is the private property of Riordan.

Your work must be ?Harvard Format?, all sources mentioned clearly. If plagiarised will result in failing the course.

You are required to choose one of the ?traditional airlines? mentioned below operating in and out of the UK, and carry out some research and analysis of their activities in order to answer the questions below.

British Airways
Air France
Swiss Air
Virgin
British Midland
Air Lingus
Lufthansa
KLM

1. Analyse the business environment within which your chosen airline operates and how this environment has changed over the last few years. (SWOT Analysis)
2. Evaluate the operations of your chosen airline with respects to the operations management issues and compare and contrast these characteristics with:
a. Another traditional airlines operating in the UK.
b. A ?no frills airlines? operating out of the UK.
3. With respect to your chosen airline what marketing strategies are evident in the terms of the market, targeting of customer groups and positioning of the product in the minds of customers?
4. Compare and contrast the marketing mix of your chosen airline with:
a. Another traditional airlines operating in the UK.
b. A ?no frills airlines? operating out of the UK.
5. What do you think are the key success factors that characterise your chosen airline in the terms of their marketing and operations? Have these factors changed in the last five years? Show evidence if any.
6. How is your chosen airline reacting to the evident success of the ?no frills airlines?? State what success if any have the traditional airlines had in their response to the no frills airlines.

Guidelines: Use STEP (Social, Technological, Economical, Political) Analysis. Demonstrate your knowledge and understanding of the core principles of Marketing and Operations Management in the context of real life, current and topical case. Do not criticise actions or criticise actions.

Operations Strategy: Performance objectives, NPD Strategy, Vertical Integration Strategy, Facilities Strategy, Technology Strategy, Workface and Organisational Strategy, Capacity adjustment strategy, Supply Chain Management strategy, Quality management and customer service.

Marketing Strategy: The business/marketing environment, Competitor analysis, Stakeholders, Internal Audit, How customers needs are identified, Market segmentation, Targeting and Positioning strategies, The marketing mix: Product, Price, Promotion, Place.