Hereditory Hemochromatosis essays

Hereditory Hemochromatosis essays Hereditary Hemochromatosis: An Iron Overload Disease Hemochromatosis is caused by a defect in the gene called HFE, which regulates the amount of iron absorbed from food. Particularly, two mutations, called C282Y and H63D, cause the abnormal metabolism of the iron. People with the disease have inherited a defective gene from each parent. If a person inherits the defective gene from only one parent he/she is a carrier but does not develop it. However, carriers might have an increase in iron absorption. Hemochromatosis is mostly found in Caucasians of Northern European decent. Both men and woman are affected but men are more likely to develop problems at younger age. The defect is present at birth but symptoms do not appear until adulthood with hereditary hemochromatosis. The disease causes the body to absorb and store too much iron, which builds up in the organs and damages them. Iron becomes part of hemoglobin, a molecule in the blood that transports oxygen from the lungs to all body tissues. With this defect, the body has no way to get rid of the excess iron so it stores it in the body tissues, especially the liver, heart and pancreas. Symptoms often include joint pain, fatigue, and lack of energy, abdominal pain, loss of sex drive, depression, shortness of breath, weight loss, and heart problems. If not detected and treated right away it will lead to more serious problems like arthritis, liver disease (enlarged liver, hepatitis, cirrhosis, cancer, or liver failure), impotence, early menopause, abnormal pigmentation of the skin (gray or bronze), damage to the pancreas (causing diabetes), thyroid deficiency, heart failure, or damage to th e adrenal gland. There is no cure for this disease but there is one treatment called phlebotomy, which is the removing of blood. For those with the disease this means taking one pint of blood once or twice a month for several months to a year. After this the blood ferritin levels w...

Capture Your Stories - Guest Post by Gary Ryan

Capture Your Stories - Guest Post by Gary Ryan Capture Your Stories Guest Post by Gary Ryan, edited by Brenda Bernstein, The Essay Expert In last week’s article by Gary Ryan, How Students Can Leverage Part Time and Volunteer Work, he explained what employability skills are and why they are important for your future. This week he asks an important question: How do you capture your experiences in a useful way? Your stories are important in the context of both creating your resume (The Essay Expert’s specialty!) and preparing for an interview. Are you the right fit? Once you are in front of your prospective employers, your goal is to communicate that you are the right fit for their organization. The interview is largely about testing your personality. The interviewers already know that you have the right technical skills or a demonstrated ability to learn them. What they don’t know is whether or not you will fit in their company culture. This is where your stories about your employability skills kick in. 95% of interview questions are behaviorally based. This means that you will be asked questions that require you to provide an example about how you have demonstrated your employability skills in the past. If you haven’t prepared your answers, you will likely fumble your way through your interview. Tell us about a time†¦ As an example, imagine being asked, â€Å"Please tell us about a time when you had to work with a difficult person.† This question is meant to elicit how well you will interact with your fellow employees. Will you be a good team member to have around the office? If you have prepared stories about teamwork, communication, leadership and problem solving, you will quickly be able to modify one of your existing stories to provide a succinct and coherent answer to this question. If you haven’t prepared your stories, your face could turn white, the blood draining from your brain: â€Å"I’m not sure. I can’t think of one right now. I know that I have worked with difficult people before but I can’t think of one right now. Sorry.† It is not unusual for these sorts of responses to be heard in an interview. How do you think the interviewers will judge your organizational â€Å"fit† with this kind of response? A structure to rely on Now here’s the good news: Interviewers have formulas that they listen for with regard to how your answers are structured. If you know the formula, you can prepare so you don’t get caught off guard. One common formula is the CAR (Challenge / Action / Result) method. When answering a question such as the one above about working with a difficult person, you might choose a CAR story that you had prepared. Let’s break down the components of a CAR story so you can create some of your own: ‘C’ is for Challenge or Circumstance. What situation sets the scene for your story? What was the context? Who were the players? What goal were you (as a team or individually) trying to achieve? What roadblocks stood in the way? Although the first place to look for CAR stories is in your work experience, some of your best examples might come from family, recreational, or other extracurricular activities. This is especially true if you are a new graduate, but might be relevant even if you are a seasoned professional. If you planned a wedding, for instance, you learned skills that will apply in any paid position where you might be asked to organize a project or event. And if you get along well with your family, that’s a great sign that you will be a great person to have in the workplace! ‘A’ is for Actions. This is where you differentiate yourself. What did you do that made a difference? Be specific and include the most pertinent actions that you undertook. In the example above, you may have recognized that part of the reason for the â€Å"difficult† person’s behavior was that you hadn’t been clear in your communication. So you may have stopped talking and just listened. Perhaps you discovered that they had misunderstood what you said- enabling you to communicate your message in a way they could comprehend. ‘R’ is for Results. This is the â€Å"So what?† part of your story. The results you have produced are some of the most important employability skills you can demonstrate. In the above example, your effective use of communication through improved listening may have resulted in a clearer understanding for the entire team of what it was trying to achieve- which in turn created a high level of focus and ultimately a successful project. You might even add that a big lesson from this experience was that through effective communication, you realized that the â€Å"difficult† person in question wasn’t that difficult after all. By sharing your results, you emphasize the positive impact you can have on an organization. Reap the benefits of preparation Preparing your CAR and employability skills stories, complete with results and lessons learned, provides you with flexibility when answering questions. You will be able to simply listen to the question and then select the most appropriate story to answer it. Your answers will be well-thought-out and evidence-based, and will make your interviewers engaged and favorable toward your application. The power of telling your stories through a structure such as CAR is that it enables you to shine and reveal your personality, in addition to demonstrating how well you prepare for important meetings (yes, an interview is a meeting!). Your interviewers are then in a position to objectively judge how you would fit in the organization. If you’d like to learn more about how to prepare yourself to be a successful interviewer and Young Professional, including another powerful formula for creating your stories and examples, then access What Really Matters For Young Professionals! Gary Ryan is the Founder of Organisations That Matter, author of What Really Matters For Young Professionals! and creator of the Yes For Success online platform for creating and executing a life of balance and personal success!

Should gays and lesbians be allowed to serve in the U.S. military Research Paper

Should gays and lesbians be allowed to serve in the U.S. military - Research Paper Example The constitution of the United States does not offer just anyone an absolute right to serve in the countries military services. Joining the military in United States is considered a privilege and demands particular conditions to be met by the prospect candidate. Anyone who meets the required conditions and sings up as a member of the military in the active duty is serves on full-time basis. All members whether men or women report on their duties if they qualify to specific age and physical conditions. The lower entry to military service is under seventeen while the upper entry is thirty five years. However entry may depend on conditions of a particular category. They issue of gays and lesbians serving in the military should not be a problem of contention and so they should be allowed as suggested by Stewart (53). Since they are qualified individuals just like any others in the military there is no reason as to why they should not be allowed in the military. The issue about gays and l esbians in the military of US has been highly debated upon in politics. This started after the court declared the Don’t ask, Don’t tell policy of the military. ... The liberals have no problem with gays and lesbians serving the military but the conservatives want to ban the issue. Before President Clinton came into power, the department of Finance had its own policy which did not allow gays and lesbians to serve in the military. Once one was investigated and found quilt of this, he/she was discharged from the military. Clinton had promised in his campaigns to overthrow the policy but it was not possible and law was enacted which forbid homosexuality forever. However despite the enactment, homosexuality is still going on in the military. This can be attributed to the fact that some of the low-ranked persons in the army, live with their roommates in the barrack. Therefore, because it has become impossible to totally eliminate homosexuality in the military, it can thus be allowed. Since individuals are not born gays or lesbians, it does not matter in the service delivery. As suggested by Newton (53), this is because lesbianism or gay practice is n ot a weakness but more of lifestyle. Serving in the military means that one is dedicated to serve his/her country and is also willing to die for it. Therefore it is important to respect the private life of individuals if it has no negative impact in their service delivery. For instance, if those individuals outside the military are not investigated in their life then there is no reason as to why military individuals should be investigated. If homosexuality does not change the life of individuals then there is no way it can change their service delivery. For instance in some countries like the NATO countries gays have been openly allowed to work in the military even as leaders and there is no single effect since it was allowed. However people may argue that

The Moon and Phases Essay Example | Topics and Well Written Essays - 1000 words

The Moon and Phases - Essay Example Afterwards, it seems that the moon vanishes for several days. Elementary teachers can use this â€Å"mystery† of the changing moon to explain sunlight, reflection, and the movement of the moon around the earth. Astronomy teaches interesting subjects about celestial objects and phenomena that can be integrated with other subjects in the elementary classroom through identifying interrelated skills, knowledge, and concepts. The revolution of the Moon around the Earth makes the Moon appear as if it is changing shape in the sky. In reality, the Moon’s shape changes because of the sunlight that it reflects. The Sun always shines on half of the Moon, and as the Moon orbits the Earth, people see different parts of that lighted part of the Moon (National Air and Space Museum, 1999). What people see as changes in the bright part of the Moon’s surface are also called as phases of the moon. The Moon does not produce light on its own; it only reflects the light of the sun. Th is reflected part changes and becomes the palpable phases of the Moon for people on Earth. The Moon goes through five basic phases shapes during a cycle that recurs every 29.5 days. The phases always go after one another in the same order. There are five basic phases of the Moon that people can see from Earth and they are: The New Moon, First Quarter Moon, Gibbous Moon, Full Moon, and Last Quarter Moon. In total, there are eight phases of the Moon, however. The eight phases start from the New Moon and eventually goes back to the New Moon phase and they are: Phase 1 - New Moon- During the phase of the New Moon, the lit side of the moon is not facing the Earth. This makes the Moon look invisible to people on Earth (NASA Starchild Project, n.d.). Phase 2 - Waxing Crescent- The Waxing Crescent Moon is the phase after the New Moon and before the First Quarter Moon. During this time, a small part, or less than 50%, of the moon is lit up by the sun (NASA Starchild Project, n.d.). The light ed part of the moon slowly expands as the Moon orbits the Earth (NASA Starchild Project, n.d.). Phase 3 - First Quarter – During the First Quarter Moon, its right side is lighted, while the left part is dark. During the instance between the New Moon and the First Quarter Moon, the fraction of the Moon that appears lighted gets bigger and bigger every day, and it will keep on expanding until it reaches the phase of the Full Moon (National Air and Space Museum, 1999). Phase 4 - Waxing Gibbous – This Moon is seen subsequent to the Full Moon, but before the Last Quarter Moon. The Waxing Gibbous Moon is almost completely lit up and the part that is lit up increases every day. Waxing means increasing (National Air and Space Museum, 1999). Phase 5 - Full Moon – During the Full Moon, the lit side of the Moon fully faces the Earth. This means that the Earth, Sun, and Moon are almost in a straight line, with the Earth in the center (National Air and Space Museum, 1999). T he Full Moon looks very bright because of the sunlight it reflects (National Air and Space Museum, 1999). Phase 6 - Waning Gibbous – The Waning Gibbous Moon is seen subsequent to the Full Moon, but before the Last Quarter Moon. The amount of the Moon that can be seen grows smaller and smaller every day. Waning â€Å"

History of Civil Engineering Essay Example for Free

History of Civil Engineering Essay Civil engineering involves the design, construction, and maintenance of works such as roads, bridges, and buildings. Its a science that includes a variety of disciplines including soils, structures, geology, and other fields. Thus the history of civil engineering is closely associated with the history of advancement in these sciences. In ancient history, most of the construction was carried out by artisans, and technical expertise was limited. Tasks were accomplished by the utilization of manual labor only, without the use of sophisticated machinery, since it did not exist. Therefore, civil engineering works could only be realized with the utilization of a large number of skilled workers over an extended period of time. * Prehistoric and Ancient Civil Engineering Structures It might be appropriate to assume that the science of civil engineering truly commenced between 4000 and 2000 BC in Egypt when transportation gained such importance that it led to the development of the wheel. According to the historians, the Pyramids were constructed in Egypt during 2800-2400 BC and may be considered as the first large structure construction ever. The Great Wall of China that was constructed around 200 BC is considered another achievement of ancient civil engineering. The Romans developed extensive structures in their empire, including aqueducts, bridges, and dams. A scientific approach to the physical sciences concerning civil engineering was implemented by Archimedes in the third century BC, by utilizing the Archimedes Principle concerning buoyancy and the Archimedes screw for raising water. ASCE Online Library www.ascelibrary.org Free search 800,000 pages All areas of civil engineering Software Engineer Degree EducationDegreeSource.com/Free_Info 100%Online Master Degree Software Engineering for Busy Programmers! Seismic Design Group www.SeismicDesignGroup.com Seismic Bracing Engineering Commercial Non-Structural Trades Ads by Google * The Roles of Civil And Military Engineer in Ancient Times As stated above, civil engineering is considered to be the first main discipline of engineering, and the engineers were in fact military engineers with expertise in military and civil works. During the era of battles or operations, the engineers were engaged to assist the soldiers fighting in the battlefield by making catapults, towers, and other instruments used for fighting the enemy. However, during peace time, they were concerned mainly with the civil activities such as building fortifications for defense, making bridges, canals, etc. * Civil Engineering in the 18th 20th Century Until the recent era, there was no major difference between the terms civil engineering and architecture, and they were often used interchangeably. It was in the 18th century that the term civil engineering was firstly used independently from the term military engineering. The first private college in the United States that included Civil Engineering as a separate discipline was Norwich University established in the year 1819. Civil engineering societies were formed in United States and European countries during the 19th century, and similar institutions were established in other countries of the world during the 20th century. The American Society of Civil Engineers is the first national engineering society in the United States. In was founded in 1852 with members related to the civil engineering profession located globally. The number of universities in the world that include civil engineering as a discipline have increased tremendously during the 19th and the 20th centuries, indica ting the importance of this technology. * Modern Concepts In Civil Engineering Numerous technologies have assisted in the advancement of civil engineering in the modern world, including high-tech machinery, selection of materials, test equipment, and other sciences. However, the most prominent contributor in this field is considered to be computer-aided design (CAD) and computer-aided manufacture (CAM). Civil engineers use this technology to achieve an efficient system of construction, including manufacture, fabrication, and erection. Three-dimensional design software is an essential tool for the civil engineer that facilitates him in the efficient designing of bridges, tall buildings, and other huge complicated structures. * http://www.thecivilengg.com/History.php CIVIL ENGINEERING (CE) Overall Focus: â€Å"Public works†/infrastructure and buildings/structures. Note: Given the number of potential applications, Civil Engineering is a very broad discipline. Primary Areas of Specialization: 1. Construction Management (combining engineering and management skills to complete construction projects designed by other engineers and architects).   2. Environmental Engineering (see separate entry) 3. Geotechnical Engineering (analysis of soils and rock in support of engineering projects/applications building foundations, earthen structures, underground facilities, dams, tunnels, roads, etc) 4. Structural Engineering (design of all types of stationary structures buildings, bridges, dams, etc.) 5. Surveying (measure/map the earth’s surface in support of engineering design and construction projects and for legal purposes locating property lines, etc.) 6. Transportation Engineering (design of all types of transportation facilities/systems – streets/highways, airports, railroads, other mass transit, harbors/ports, etc.). 7. Water Resources Engineering (control and use of water, focusing on flood control, irrigation, raw water supply, and hydroelectric power applications) http://groups.yahoo.com/group/AR001_ARCHCRUZ/files/3.%20LETTERING/

Dinosaurs :: essays research papers

Dinosaurs   Ã‚  Ã‚  Ã‚  Ã‚  Dinosaur is the name of large extinct reptiles of the Mesozoic Era, during which they were the dominant land animals on Earth. The term was proposed as a formal zoologic name in 1842 by the British anatomist Sir Richard Owen, in reference to large fossil bones unearthed in southern England. The various kinds of dinosaurs are classified in two formal categories, the orders Saurischia and Ornithischia, within the subclass Archosauria.   Ã‚  Ã‚  Ã‚  Ã‚  The first recorded dinosaur remains found consisted of a few teeth and bones. They were discovered in 1882 in Sussex, England, by an English doctor, Gideon Mantell, who named them iguanodon. About the same time, other fossil teeth and bones were found near Oxford, England, by Rev. William Buckland. These were named Megalosaurus. Thousands of specimens have since been discovered nearly worldwide.   Ã‚  Ã‚  Ã‚  Ã‚  Different types of dinosaurs varied greatly in form and size, and they were adapted for diverse habitats. Their means of survival can only be identified from their fossil remains, and some identifications are in dispute. They ranged in weight from 4 to 6 lb., in the case of the compsognathus, and up to 160,000 lb., in the case of the brachiosaurus. Most dinosaurs were large, weighing more than 1,100 lb., and few weighed less than 100 lb. Most were herbivores, but some saurischians were carnivorous. The majority were four- footed but some ornithischians and all carnivores walked on their hind legs.   Ã‚  Ã‚  Ã‚  Ã‚  Always classified as reptiles, dinosaurs have traditionally been assumed to have been reptilian in their physiology, cold-blooded, and ectothermic. In recent years several different lines of evidence have been interpreted as indicating that dinosaurs may have had warm blood and high rates of metabolism, comparable to birds and mammals. Evidence supporting this view includes upright posture and carriage; mammallike microscopical structure of bones; skeletal features suggestive of high activity; and specialized food-processing dentitions and low ratios of dinosaurian predators to prey animals, both suggesting high food requirements. The evidence is not conclusive--all the facts can be alternatively explained--but some dinosaurs may have been endothermic.   Ã‚  Ã‚  Ã‚  Ã‚  The reproductive means of most dinosaurs is as yet unknown. Fossil eggs, attributed to one of the horned dinosaurs and a sauropod, have been discovered in Mongolia and France. Fragments that are presumed to be of dinosaur eggs have also been found in Brazil, Portugal, Tanzania, and in the United States, Colorado, Montana, and Utah. In Montana, Utah, and Alberta, Canada, fossils of unhatched dinosaur eggs have been discovered. This evidence indicates egg- laying reproduction in dinosaurs, like most modern reptiles. A few scientists believe that some dinosaurs may have given birth to living young, but no

Dividend Policy Trends

Dividend Policy of Indian Corporate Firms: An Analysis of Trends and Determinants Dr. Y. Subba Reddy1 The present study examines the dividend behavior of Indian corporate firms over the period 1990 – 2001 and attempts to explain the observed behavior with the help of trade-off theory, and signaling hypothesis. Analysis of dividend trends for a large sample of stocks traded on the NSE and BSE indicate that the percentage of companies paying dividends has declined from 60. 5 percent in 1990 to 32. percent in 2001 and that only a few firms have consistently paid the same levels of dividends. Further, dividend-paying companies are more profitable, large in size and growth doesn’t seem to deter Indian firms from paying higher dividends. Analysis of influence of changes in tax regime on dividend behavior shows that the tradeoff or tax-preference theory does not appear to hold true in the Indian context. Test of signaling hypothesis reinforces the earlier findings that dividen d omissions have information content about future earnings. However, analysis of other non-extreme dividend events such as dividend reductions and non-reductions shows that current losses are an important determinant of dividend reductions for firms with established track record and that the incidence of dividend reduction is much more severe in the case of Indian firms compared to that of firms traded on the NYSE. Further, dividend changes appear to signal contemporaneous and lagged earnings performance rather than the future earnings performance. 1 Asst. Professor, Institute for Financial Management and Research (IFMR), Chennai. The views expressed and the approach suggested are of the authors and not necessarily of NSE. 1. Introduction From the practitioners’ viewpoint, dividend policy1 of a firm has implications for investors, managers and lenders and other stakeholders. For investors, dividends – whether declared today or accumulated and provided at a later date – are not only a means of regular income2, but also an important input in valuation of a firm3. Similarly, managers’ flexibility to invest in projects is also dependent on the amount of dividend that they can ffer to shareholders as more dividends may mean fewer funds available for investment. Lenders may also have interest in the amount of dividend a firm declares, as more the dividend paid less would be the amount available for servicing and redemption of their claims. However, in a perfect world as Modigliani and Miller (1961) have shown, investors may be indifferent about the amount of dividend as it has no influenc e on the value of a firm. Any investor can create a ‘home made dividend’ if required or can invest the proceeds of a dividend payment in additional shares as and when a company makes dividend payment. Similarly, managers may be indifferent as funds would be available or could be raised with out any flotation costs for all positive net present value projects. But in reality, dividends may matter, particularly in the context of differential tax treatment of dividends and capital gains. Very often dividends are taxed at a higher rate compared to capital gains. This implies that dividends may have negative consequences for investors4. Similarly, cost of raising funds is not insignificant and may well lead to lower payout, particularly when positive net present value projects are available. Apart from flotation costs, information asymmetry between managers and outside investors may also have implications for dividend policy. According to Myers and Majluf (1984), in the presence of information asymmetry and flotation costs, investment decisions made by managers are subject to the pecking order of financing choices available. Managers prefer retained earnings to debt and debt to equity flotation to finance the available projects. Information asymmetry between agents (managers) and principals (outside shareholders) may also lead to agency cost (Jensen and Meckling, 1976). One of the mechanisms o reducing expropriation of outside f shareholders by agents is high payout. High payout will result in reduction of free cash flow available to managers and this restricts the empire building efforts of managers. The presence of information asymmetry may a mean that managers need to signal their ability to lso generate higher earnings in future with the help of high dividend payouts (Bhattacharya, 1979, John and Williams 1985, and Miller and Rock, 1985). However, the credibility of signals depends on the cost of signaling – the cost being loss of financial flexibility. High payout results in reduction of free cash flow when in fact the firm needs more funds to pursue high growth opportunities. Rozeff (1994) models payout ratios as a function of three factors: flotation costs of external funding, agency cost of outside ownership and financing constraints as a result of higher operating and financial leverage5. To summarize, several theories have been proposed in explaining why companies pay dividends6. While many earlier studies point out the tax-preference theory, more recent studies emphasize signaling and agency cost rationale of dividend payments. However, the dividend puzzle is yet unresolved and the words of Brealey (1992) poses the dividend policy decision as â€Å"What is the effect of a change in cash dividends, given the firm’s capital-budgeting and borrowing decisions? † In other words, he looks at dividend policy in isolation and not as a by-product of other corporate financial decisions. 2 Lintner (1956) finds that firms pay regular and predictable dividends to investors, where as the earnings of corporate firms could be erratic. This implies that shareholders prefer smoothened dividend income. Bernstein (1998) observes that given the ‘concocted’ earnings estimates provided by firms, the low dividend payout induces reinvestment risk and earnings risk for the investors. 4 Black (1976) notes that in the presence of taxes, investors â€Å"prefer smaller dividends or no dividends at all†. 5 According to Kalay (1982), in the absence of restraining covenants, shareholders can transfer wealt h from bondholders by paying off dividend to themselves either by selling existing assets or by reducing investment or by using proceeds of a senior debt. 6 Baker, Powell and Veit (2002) survey different streams of research work on dividends. 2 Fischer Black (Black 1976) may well apply in today’s context: â€Å"The harder we look at the dividend picture, the more it seems like a puzzle, with pieces that just don’t fit together†. One of the striking aspects that have been noticed in recent periods is the lower dividend paid by corporate firms in the US. Fama and French (2001) analyze the issue of lower dividends paid by corporate firms over the period 1973-1999 and the factors responsible for such a decline. They attribute the decline to changing firm characteristics of size, earnings and growth. However, it is to be seen whether the change owards lower dividends is a permanent feature or will there be reversal. A decline in dividends, according to Fama and Frenc h, could be due to lower transaction costs, improved corporate governance mechanisms, and the increasing preference towards capital gains. 1. 1 Indian Scenario In the Indian context, a few studies have analyzed the dividend behavior of corporate firms. Mahapatra and Sahu (1993) find cash flow as a major determinant of dividend followed by net earnings. Bhat and Pandey (1994) undertake a survey of managers’ perceptions of dividend decision and find that managers perceive current earnings as the most significant factor. Narasimhan and Asha (1997) observe that the uniform tax rate of 10 percent on dividend as proposed by the Indian union budget 1997-98, alters the demand of investors in favor of high payouts. Mohanty (1999) finds that firms, which issued bonus shares, have either maintained the pre-bonus level or only decreased it marginally there by increasing the payout to shareholders. Narasimhan and Vijayalakshmi (2002) analyze the influence of ownership structure on dividend payout and find no influence of insider ownership on dividend behavior of firms. However, it is still not clear as to what is the dividend payment pattern of firms in India and why do they initiate and omit dividend payments or reduce or increase dividend payments. Hence it is proposed to analyze the dividend payout of firms in India and analyze the dividend initiations and omissions and other changes in dividends and the signals that these events convey. Following Fama and French (2001), the present study also attempts to analyze the impact of profitability, size and growth on the dividend payout of firms. Similarly, following Healy and Palepu (1988) an attempt is made to analyze the signaling hypothesis, i. e. arnings information conveyed by dividend initiations and omissions. Since, initiations and omissions construe extreme dividend events, changes in dividends i. e. , increases and decreases and the information that they convey is also examined following DeAngelo, DeAngelo and Skinner (1992). There have been several changes in the tax regime in the last few years. The union budget 1997-98 made dividends taxable at t e hands of company paying them and not in the hands of investors receiving them. h Similarly there have been changes in the capital gains tax and exemption of dividend income under Section 80 L of the Income Tax Act 1961. All these changes have implications for the dividend policy of corporate firms. According to tax-preference or trade-off theory, favorable dividends tax should lead to higher payouts. Hence it is proposed to analyze the impact of tax regimes on dividend policies of corporate firms. 1. 2 Objectives 1. To study the trends in the dividend payment pattern of Indian corporate firms; 2. To analyze the impact of changes in dividend tax on the propensity to pay dividends; 3. To analyze the influence of firm characteristics such as profitability, growth and size on the dividend payment pattern; 4. To analyze the signaling hypothesis, specifically earnings information conveyed by dividend initiations and omissions; and 5. To analyze the influence of loss on dividend reductions. 3 In other words, the present study focuses on an analysis of dividend trends and attempts to analyze the determinants of these trends with the help of trade-off or tax-preference theory and signaling hypothesis. There are other important determinants of dividend behavior such as transactions costs, which we will not analyze, in the present study. In the next Section, we review the relevant literature, followed by a description of the database employed and methodology adopted in Section 3. Dividend trends are discussed in Section 4, and the analysis of characteristics of dividend payers is presented in Section 5. Sections 6 and 7 deal with the signaling hypothesis: first the case of dividend initiations and omissions and second dividend reductions. Section 8 summarizes the finding of study, points out limitations and concludes with directions for further research. 2. Review of Relevant Literature DeAngelo, DeAngelo and Skinner (1992) analyses the relationship between dividends and losses and the information conveyed by dividend changes about the earnings performance. They examine the dividend behaviour of 167 NYSE firms with at least one annual loss during 1980-95 and those of 440 firms with no losses during the same period, where all the firms had a consistent track record of ten or more years of positive earnings and dividends. They find that 50. 9% of 167 firms with at least one loss during 1980-95 reduced dividends, compared to 1% of 440 firms without losses. Their findings support signaling hypothesis in that dividend changes improve the ability to predict future earnings performance. Glen et al. (1995) study the dividend policy of firms in emerging markets. They find that firms in these markets have a target dividend payout rate, but less concerned with volatility in dividends over time. They also find that shareholders and governments exert a great deal of influence on dividend policy and observe that dividends have little signaling content in these markets. Benartzi, Michaely, Thaler (1997) analyzes the issue of whether dividend changes signal the future or the past. For a sample of 7186 dividend announcements made by NYSE or AMEX firms during the period 1979-91, they find a lagged and contemporaneous relation between dividend changes and earnings. Their analysis also shows that in the two years following dividend increases, earnings changes are unrelated to the sign and magnitude of dividend changes. Bernsterin (1998) expresses concern over the decline in payout over a period of time in the US market. He observes that given the ‘concocted’ earnings estimates provided by firms, the low dividend payout induces reinvestment risk and earnings risk for the investors. He asserts that â€Å"†¦ try calculating the historical correlation between payout ratios in year t and earnings growth over t + 5. The correlation coefficient is positive and statistically significant† 7. Fama and French (2001) analyze the issue of lower dividends paid by corporate firms over the period 1973-1999 and the factors responsible for the decline. In particular they analyze whether the lower dividends were the effect of changing firm characteristics or lower propensity to pay on the part of firms. They observe that proportion of companies paying dividend has dropped from a peak of 66. 5 percent in 1978 to 20. 8 percent in 1999. They attribute this decline to the changing characteristics of firms: â€Å"The decline in the incidence of dividend payers is in part due to an increasing tilt of publicly traded firms toward the characteristics – small size, low earnings, and high growth – of firms that typically have never paid dividends†8. Baker, Veit and Powell (2001) study the factors that have a bearing on dividend policy decisions of corporate firms traded on the Nasdaq. The tudy, based on a sample survey (1999) response of 188 firms out of a total of 630 firms that paid dividends in each quarter of calendar years 1996 and 1997, finds that the following four factors have a significant impact on the dividend decision: pattern of past dividends, stability 7 8 Bernstein (1998), pp. 1. Fama and French (2001), p. 79 4 of earnings, and the level of current and fut ure expected earnings. The study also finds statistically significant differences in the importance that managers attach to dividend policy in different industries such as financial versus non-financial firms. Ramacharran (2001) analyzes the variation in dividend yield for 21 emerging markets (including India) for the period 1992-99. His macroeconomic approach using country risk data finds evidence for pecking order hypothesis – lower dividends are paid when higher growth is expected. The study also finds that political risk factors have no significant impact on dividend payments of firms in emerging markets. Lee and Ryan (2002) analyze the dividend signaling-hypothesis and the issue of direction of causality between earnings and dividends – whether earnings cause dividends or vice versa. For a sample of 133 dividend initiations and 165 dividend omissions, they find that dividend payment is influenced by recent performance of earnings, and free cash flows. They also find evidence of positive (negative) earnings growth preceding dividend initiations (omissions). 2. 1 Previous Indian Studies Kevin (1992) analyzes the dividend distribution pattern of 650 non-financial companies which closed their accounts between September 1983 and August 1984 and net sales income of one crore rupees or more. He finds evidence for a sticky dividend policy and concludes that a change in profitability is of minor importance. Mahapatra and Sahu (1993) analyze the determinants of dividend policy using the models developed by Lintner (1956), Darling (1957) and Brittain (1966) for a sample of 90 companies for the period 1977-78 – 1988-89. They find that cash flow is a major determinant of dividend followed by net earnings. Further, their analysis shows that past dividend and not past earnings is a significant factor in influencing the dividend decision of firms. Bhat and Pandey (1994) study the managers’ perceptions of dividend decision for a sample of 425 Indian companies for the period 1986-87 to 1990-91. They find that on an average profit-making Indian companies have distributed about one-third of their net earnings and that the average dividend payout ratio is 43. 6 percent. They also find that the average dividend payout ratio is 54 percent for the sample of both profitmaking and loss-making companies and the average dividend rate is in the range of 14. 3 percent to 19. 2 percent. They also observe variation in dividend policy of different industries. Further, a survey of these 425 companies has been attempted. How ever, only 31 questionnaires have been received and of these they find 28 amenable for further analysis. Their analysis of the respondents shows that managers perceive current earnings as the most significant factor influencing their dividend decision followed by patterns of past dividends. They also find two other variables increasing equity base and expected future earnings to have significant influence. However, they find industry to have the least influence on the dividend, which has been contrary to the expectations. Mishra and Narender (1996) analyze the dividend policies of 39 state-owned enterprises (SoE) in India for the period 1984-85 to 1993-94. The find that earnings per share (EPS) is a major factor in determining the dividend payout of SoEs. Narasimhan and Asha (1997) discuss the impact of dividend tax on dividend policy of firms. They observe that the uniform tax rate of 10 percent on dividend as proposed by the Indian union budget 1997-98, alters the demand of investors in favor of high payouts rather than low payouts as the capital gains are taxed at 20 percent in the said period. Mohanty (1999) analyzes the dividend behavior of more than 200 firms for a period of over 15 years. He finds that in most bonus issue cases firms have either maintained the pre-bonus level or only decreased it marginally there by increasing the payout to shareholders. The study also finds that firms that declared bonus during 1982-1991 showed higher returns to their shareholders compared to firms which did not issue bonus shares but maintained a steady dividend growth. He finds evidence for a reversal of this trend in the 1992- 5 1996 period. He attributes such a reversal in trend to the changed strategy of multi-national corporations (MNCs) and their reluctance to issue bonus shares. Narasimhan and Vijayalakshmi (2002) analyze the influence of ownership structure on dividend payout of 186 manufacturing firms. Regression analysis shows that promoters’ holding as of September 2001 has no influence on average dividend payout for the period 1997-2001. 3. Database and Methodology 3. 1 Database Dividend payment pattern of all companies that are listed for trading on one of the two major exchanges namely National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) during the period 1989-1990 to 2000-2001 (we refer each year henceforth with the end year i. e. for 2000-2001 to 2001) are employed for analysis. The data has been sourced from Prowess database of the Centre for Monitoring Indian Economy (CMIE). For the purpose of this study, only final cash dividends are considered and stock repurchases and stock dividends are not considered. Unlike the firms in developed countries that pay quarterly dividends, Indian companies typically pay only one dividend during a year. A few firms do pay interim dividends, however, data regarding these are not readily accessible and it is extremely difficult to get such data for a reasonable number of years. Further, stock repurchases have been permitted only recently and only about a hundred companies have bought back their stocks so far. Hence, in the present study stock repurchases are not considered for analysis. Stock price data for the prior year of dividend announcement are also taken from the Prowess database. 3. 2 Methodology for Analysis of Trends To analyze the trends in dividend payment pattern, number of companies paying dividend as percentage of total firms, average dividend paid, dividend per share, payout ratio, and dividend yield are computed for the period 1990 to 2001. Dividend per share (DPS) is calculated as DPS j ,t = Dividend j ,t EQCap j ,t Where, DPSj,t refers to dividend per share for company j in year t; Dividend j,t refers to amount of dividend paid by company j in year t; and EQCap j,t refers to paid -up equity capital for firm j in year t. Equity capital is employed instead of the usual number of outstanding shares in the denominator as it facilitates comparison of rupee dividend paid per share by removing the impact of different face or par values. Dividend payout ratio (PR) is computed as PR jt = Dividend j , t PAT j ,t Where, PR j,t is dividend payout ratio, Dividend j,t refers to amount of dividend paid by company j in year t; and PATj,t refers to net profit or profit after tax for firm j in year t. Dividend Yield (DY) is computed as 6 DY jt = DPS j ,t Price j ,t ? 1 t Where, DYjt refers to dividend yield for firm j in year t, DPSjt refers to dividend per share for firm j in year , and Pricej,t-1 is closing price of previous year for firm j. Further, the entire sample is categorized into payers and non-payers to examine the trends in dividends across different subgroups. Payers are those firms that have paid dividend in the current year, where as nonpayers have not paid dividend in the current year. Payers are further classified into regular payers, initiators and current payers. Regular payers are those firms that have paid dividend regularly without ever skipping the payments. Initiators on the other hand refers to those firms with a maiden dividend, where as current payers are those firms who are neither regular payers nor initiators. Non-payers are further categorized into never paid, former payers and current non-payers. Never paid firms are those that have never paid even a single dividend, where as former payers are those firms which at some previous point had paid dividends. Current non-payers are those firms which are recently listed and that they are neither former-payers nor are in the never paid category in any of the previous years. 3. 3 Influence of Tax Regime Change: Test of Trade-off Theory Paired samples t-test has been employed to analyze the influence of changes in dividend tax during 199798 on the dividend propensity of Indian corporate firms. According to the tradeoff theory, corporate firms pay more dividends when the dividend tax is low compared to that of capital gains tax. The tax regime ushered in during 1997-98, whereby dividends are taxed at source at a uniform rate of 10%, has tilted the balance in favor of dividends. Changes in dividends are captured with the help of two measures – dividend per share and dividend payout percentage. For this purpose total dividend per share and average dividend payout percentage during the previous tax regime, i. e. the incidence of dividend tax is on the investors are compared with that of changed tax regime where dividend taxes are payable by corporate firms at a flat rate of 10%. The period 1994-95 to 1996-97 constitutes the first sub-period and the period 1998-99 to 2000-01 constitutes the second period. The following hypotheses are tested using paired samples t-test: (i) Null hypothesis of no differences between the total dividend per share between the two periods; and (ii) Null hypothesis of no difference between the average percentage payout between the two periods. Further, changes in the propensity of regular payers and changes in the payment pattern between 1996-97 and 1998-99 as a result of change in tax regime are also tested. 3. 4 Characteristics of Payers and Non-Payers Consistent with Fama and French, logit regression coefficients are estimated to analyze the influence of firm characteristics on the dividend payment pattern, for each year t during 1990-2001. The dependent variable assumes a value of 0 when the firm pays no dividend and assumes a value of 1 when pays a dividend. The explanatory variables are: Et/At is profitability measured as the ratio of aggregate earnings before interest to aggregate assets; dAt/At, is growth rate of assets; Vt/At is market-to-book ratio i. e. , the ratio of the aggregate market value to the aggregate book value of assets; and the NSEPt is the percent of firms with the same or lower market capitalization. Coefficients are computed for each of the year 7 and the aggregate coefficients and associated t values are analyzed to infer the influence o profitability, f growth and size. 3. Test of Signalling Hypothesis: Case of Dividend Initiations and Omissions For this part of the analysis, a firm is classified as initiator if it has paid dividend in the current year but has not paid dividends for the preceding 3 years. Similarly a firm is categorized as omission firm, if the firm has not currently paid dividend but has paid dividend in the preceding three years. To analyze signaling hypothesis, consistent with Healey and Palepu , earnings patterns of firms initiating and omitting dividend for 3 years before the year of event and 3 years after event are examined. To aggregate results across firms, earnings changes in these years are expressed as a percentage of the previous year’s closing stock price, PJ. The standardized change in earnings for firm j in year t, is defines as ? E j ,t = E j ,t ? E j ,t ? 1 Pj Where Ej,t are earnings per share before extraordinary items and discontinued operations9 for firm j in year t. The null hypotheses of average earnings changes are zero is tested with the help of Dunnett’s C (Post Hoc) test. Analysis pertaining to initiations and omissions only cover a particular sample of extreme events and excludes firms not having a dividend track record of less than 3 years. In order to cover other dividend events like dividend reductions and increases in the following we arrive at yet another sample. 3. 6 Test of Signaling Hypothesis: Case of Dividend Reductions To analyze the relationship between dividends and losses a sample is drawn with firms having consistent profitability and dividend track records during 1990 – 1995 and who have earnings and dividend information for the period 1996 – 2001. The importance of annual losses on dividend reductions and annual dividend omissions has been analyzed with the help of logit analysis. The dependent variable equals zero if a firm has maintained or increased its dividend per share and is equal to one if the firm announced a reduction in dividend per share. The loss dummy assumes a value of one if the firm reports a loss for the year under study and zero otherwise. The level of net income and changes in net income are standardized with the previous year’s net worth for each firm. For firms in loss sample, the initial loss year constitutes the event year where as for non-loss firms, the initial year of earnings decline constitutes the event year. Similarly to examine the influence of past and future levels of earnings logit analysis has been employed on the subset for event years 1997 and 1998. The dependent variable equals zero if a firm has maintained or increased its dividend per share and is equal to one if the firm announced a reduction in dividend per share. The explanatory variables are earnings in 1 year before the event (t-1), 2 years preceding the event (t-2), current earnings (t), earnings in the year following the event year (t+1), earnings in 2 years following the event (t+2). Similarly, mean difference in earnings over t 2 through t+2 years is also examined with the help of Dunnett’s C test. This analysis would be useful in determining whether dividend changes are impacted by contemporaneous or lagged or expected earnings performance. 9 In the Indian context an approximate value for this is derived from ‘other income’. 8 4. Trends in Dividends and Influence of Changes in Tax Regime Average profit after tax (PAT) has increased from Rs. 4. 68 crore in 1990 to Rs. 6. 11 crore in 2000 and Rs. 9. 36 crore in 2001 (Table 4. 1). However, there have been several fluctuations in average PAT reflecting the changes in Indian economy. In the early phases of economic reform, many firms had to restructure as the economy was opened up and structural adjustments were undertaken resulting in a reduction in PAT. The subsequent pick up in the mid -90s has seen an increase in average PAT. The late 1990s, which marked a significant decline in economic activity, have had their impact on PAT of firms. 4. 1 Average Dividend Paid Despite fluctuations in PAT, the average aggregate dividend payments have steadily increased from Rs. . 99 crore in 1990 to Rs. 2. 93 crore in 2000 and Rs. 4. 19 crore in 2001. Further, compared to PAT the dividend payments have exhibited a smooth trend implying that dividend smoothening is occurring in the Indian context (Figure 4. 1). Table 4. 1 Trend in Dividends and PAT During 1990-2001 Year Number of Firms 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 Common Firms 1707 2184 2505 30 97 4020 5115 5600 5855 5980 6248 6225 4766 871 Average Dividend Rs. Crore 0. 99 0. 98 1. 11 1. 11 1. 27 1. 56 1. 85 2. 05 2. 26 2. 9 2. 93 4. 19 SD of Average SD of Dividend PAT PAT Rs. Crore Rs. Crore Rs. Crore 3. 92 4. 68 48. 45 3. 79 4. 05 37. 88 4. 54 4. 19 40. 45 4. 85 3. 06 46. 76 6. 19 4. 15 51. 41 8. 42 6. 96 57. 55 10. 80 7. 19 62. 92 13. 91 6. 38 65. 65 17. 18 5. 69 103. 52 22. 14 5. 09 88. 19 26. 46 6. 11 103. 54 44. 71 9. 36 134. 39 Number of firms paid dividend during the study period have shown an up trend till 1995 and have fallen subsequently (Appendix Figure 4. 1), where as the percentage of companies paying dividends has declined from 60. percent in 1990 to 32. 1 percent in 2001 (Table 4. 2 and Figure 4. 2). This is consistent with the trend observed in the US market (Fama and French 2001). The fact that percentage of companies paying dividends have declined whereas the average dividend paid has increased implies tha t companies which have been paying dividend have paid higher amounts in recent years. Total non-payers have steadily increased from 1990 to 2000 before declining slightly in 2001 (Appendix Table A4. 1 and Figures A4. 2 and A4. 3). Firms, which have never paid dividend, constituted a significant proportion through out the sample period – constituting more than 50% from 1991 to 2001 continuously. The number of firms, which at some previous time paid dividend, have increased overtime and reached almost 50% of non-payers in 2001. Figure 4. 1 9 Trend in Average Dividends, and PAT During 1990-2001 Average Dividend Average PAT 10 9 8 7 6 5 4 3 2 1 0 1990 1992 1994 1996 1998 2000 Rs. Crores Year Table 4. 2 Trend in Dividend Payments During 1990-2001 Year Paid Dividend No. 033 1272 1533 1823 2333 2775 2723 2386 2101 2007 1988 1531 % 60. 50 58. 20 61. 20 58. 90 58. 00 54. 30 48. 60 40. 80 35. 10 32. 10 31. 90 32. 10 Not Paid Dividend No. 674 912 972 1274 1687 2340 2877 3469 3879 4241 4237 3235 % 39. 50 41. 80 38. 80 41. 10 42. 00 45. 70 51. 40 59. 20 64. 90 67. 90 68. 10 67. 90 Total Number of Firms 1707 2184 2505 3097 4020 5115 5600 5855 5980 6248 6225 4766 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 Total number of firms paying dividend has increased up to 1995 and has registered sustained decline there after (Table 4. , Appendix Figures A4. 4 and A4. 5). Mirroring these trends firms, which have paid dividends regularly, peaked in 1995 and recorded declines thereafter. Initiators have shown a steady decline from 1991 and have fallen to 5% in 2001. Average dividend paid by payers has increased steadily from Rs. 1. 69 crore in 1991 to Rs. 9. 16 crore in 2000 and Rs. 13. 05 crore in 2001 (Figure 4. 3, Appendix Table A4. 2). Regular payers are more in number and have paid higher average dividend compared to that of current payers and initiators (Appendix Figures A4. 6 and A4. 7). Current payers have paid higher dividend compared to initiators except in the year 2001. The number of initiators have increased up to the year 1995 and have shown a decline thereafter, where as current payers have steadily increased in number up to 2000. 10 Figure 4. 2 Dividend Behaviour of Indian Corporate Firms During 1990 – 2001 (in %) 80% 70% 60% % Non-Payers % Payers % of Firms 50% 40% 30% 20% 10% 0% 1990 1992 1994 1996 1998 2000 Year Figure 4. 3 Comparision of Average Dividend Paid During 1991 2001 by Payer Group Initiator Current Payers Regular Payers Total Payers 20 15 10 5 0 Rs. Crore 1991 1993 1995 1997 1999 2001 Year A comparison of index and non-index firms shows that the former group of companies on average has paid more dividend than the latter group (Table A4. 3 and A4. 4). Similarly, it is observed that companies, which constitute popular market indices such as Sensex and Nifty paid more dividends compared to companies in the broad market indices such as BSE 100, CNX Mid-Cap, BSE 200, CNX 500, and BSE 500. These observations are on the expected lines as higher dividend payment is one of the important criteria for inclusion of stocks into indices. A study of number of companies paying dividend also reveals that a significantly larger proportion of index firms have paid dividend compared to non-index firms. 29 out of 30 Sensex firms and 49 out of 50 Nifty firms have paid dividend in 2001, the exception being Tata Engineering and Locomotive Company Ltd. (TELCO). Analysis of industry-wise average dividend paid shows that in the early 1990s, firms in the diversified industry have paid more dividends followed by mining firms and electricity firms (Table 4. 3). However, by the end of 2000 and 2001 firms in the electricity industry have paid more dividend followed by mining and diversified companies. It has also been observed that textile companies have continued to pay low amounts on an average throughout the sample period where as firms in the financial services industry have improved their average dividend payments over the sample period. The recent h growth firms in the computer igh 11 hardware and software segments, which are part of the machinery industry, have generally shown lower dividend payments. In sum, the number of firms paying dividend during the study period have shown an up trend till 1995 and have fallen subsequently. Further, compared to PAT the dividend payments have exhibited a smooth trend implying that dividend smoothening is occurring in the Indian context. Regular payers are more in number and have paid higher average dividend compared to that of current payers and initiators. Of the nonpayers, former payers are growing in numbers. Index firms appear to pay higher dividends compared to that of non-index firms. Further, smaller indices appear to have higher average dividend compared t that of o larger indices. Industry trends indicate that firms in the electricity, mining and diversified industries have paid more dividend where as textile companies have paid less dividends. Firms in the machinery industry which includes computer hardware and software segments have shown lower dividends. Table 4. 3 INDUSTRY Average Dividend Paid During 1990-2001 – Industry-wise (in Rs. Crore) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 1. 09 3. 56 1. 28 . 67 . 88 . 70 . 80 2. 57 . 39 . 50 1. 02 . 48 1. 25 . 96 3. 88 1. 14 1. 39 . 97 . 65 . 90 2. 79 . 51 . 62 . 76 . 47 1. 17 1. 05 4. 24 1. 19 1. 47 . 98 . 72 1. 37 2. 97 . 72 . 70 . 86 . 47 1. 0 . 97 5. 11 2. 26 1. 38 . 89 . 73 1. 36 3. 57 . 62 . 64 . 92 . 53 1. 06 1. 08 6. 14 5. 85 1. 49 . 94 . 83 1. 72 2. 87 . 73 . 63 1. 01 . 72 1. 39 1. 38 1. 57 1. 69 1. 92 7. 72 10. 13 10. 99 12. 86 9. 54 13. 08 18. 31 17. 37 2. 10 2. 46 2. 72 3. 16 1. 02 . 80 . 90 1. 12 . 99 1. 11 1. 13 1. 20 2. 20 2. 39 2. 14 1. 80 2. 94 8. 87 17. 44 22. 23 . 70 . 75 . 57 . 35 . 85 1. 18 1. 00 . 86 1. 07 1. 18 1. 23 1. 34 . 86 . 82 . 58 . 51 2. 02 2. 83 3. 58 3. 18 1. 68 17. 17 26. 33 3. 20 1. 13 1. 34 1. 40 21. 99 . 56 . 90 1. 34 . 48 2. 95 2. 41 22. 76 27. 24 4. 25 1. 34 1. 58 1. 72 26. 31 . 58 1. 12 1. 42 . 56 3. 44 2001 Firms 2. 46 29. 55 48. 7 5. 29 1. 89 2. 11 3. 08 35. 36 1. 05 1. 51 4. 07 . 56 3. 03 1138 184 58 1097 745 1065 555 81 324 296 1264 750 225 Chemicals and Plastics Diversified Electricity Financial Services Food and Beverages Machinery Metals and Metal Product Mining Misc. Manufacturing Non-Metallic Mineral Pro Other Services Textiles Transport Equipment 4. 2 Dividend Per Share Average dividend per share (DPS) has increased from 14 paisa in 1990 to 26 paisa in 2000 and 15 paisa in 2001 (Table 4. 4, Figure 4. 4). An analysis of distribution of firms shows that 39 percent have paid nil DPS in 1990 and the percentage has increased to 67. 7 in 2001 (Table 4. ). Percentage of firms in the average class i. e. , DPS in the range of Rs. 0 to Rs. 0. 25 have declined from a high of 45. 9 in 1990 to 18. 5 in 2001. This implies that the increased average DPS over the latter period has mainly been due to a few firms paying larger DPS. Firms in chemicals and plastics industry have steadily improved their DPS from 14 paisa in 1990 to 27 paisa in 2000 and 25 paisa in 2001 (Table 4. 6). Where as textiles firms have shown a decline in DPS from 13 paisa in 1990 to 6 paisa in 2001. Machinery firms have paid a steady 12 to 14 paisa except for the years 1996 and 1997 when they paid marginally more. An analysis of index and non-index firms DPS shows that index firms on an average paid more DPS than non-index firms (Table A4. 14). Similarly, narrow indices have high average DPS than broad indices. 12 Table 4. 4 Average Dividend Per Share (DPS) During 1990-2001 (in Rs. ) Year Number Minimum Maximum of Firms DPS DPS 1990 1694 0 12. 71 1991 2153 0 10. 58 1992 2468 0 15. 58 1993 3028 0 51. 2 1994 3953 0 57. 5 1995 5032 0 135. 33 1996 5536 0 174. 67 1997 5801 0 222 1998 5911 0 350. 33 1999 6176 0 249. 75 2000 6167 0 266. 38 2001 4734 0 61. 5 Common 866 Firms10 Average DPS 0. 1406 0. 1385 0. 1427 0. 1514 0. 1582 0. 803 0. 2158 0. 198 0. 2337 0. 2544 0. 2571 0. 1538 Std. Deviation 0. 3455 0. 3009 0. 3568 1. 0025 1. 2983 2. 3543 3. 3243 3. 4834 5. 8833 4. 8938 4. 4156 1. 2899 Average DPS (1% trimmed) by all payers have increased from 21 paisa in 1991 to 31 paisa in 2000 and 29 paisa in 2001 (Figure 4. 5). Of the payers, regular payers have consistently paid more dividend per share compar ed to other payers. Similarly initiators have always paid lower dividend per share compared to current payers. Figure 4. 4 Average Dividend Per Share (DPS) During 1990-2001 Average DPS (in Rs. ) Average DPS 0. 30 0. 25 0. 20 0. 15 0. 10 0. 05 0. 0 1990 1992 1994 1996 1998 2000 Year An analysis of recurrence of dividend per share group shows that two firms have consistently paid dividend in the range of 25 to 50 paisa per share for all the 12 years, where as 18 firms have paid up to 25 paisa (Appendix Table A4. 6 and A4. 7). An analysis of dividend reductions by firms shows that only five companies namely Mahindra Sintered Products Ltd, Otis Elevator Co. (India), Bharat Electronics, Amritlal Chemaux, and Carborundum Universal have consistently paid higher dividend per share out of a 330 firms that paid dividends in all years of the sample period (Appendix Table A4. ). 43 firms registered a single instance of dividend per share reduction, where as 68 firms lowered twice, 82 firms lowe red thrice etc. On the whole average DPS has shown a steady growth except in the year 2001. Regular payers have consistently paid more dividend per share compared to other payers, where as initiators have always paid 5 common firms are lost on account of missing information on number of outstanding stocks and hence there is difference in the number of common firms from that of Table 4. 1. 10 13 lower dividend per share. Analysis also shows that only a few firms have consistently paid same levels of dividend. Index firms on an average paid more DPS than non-index firms. Similarly, narrow indices have high average DPS than broad indices (Appendix table A4. 8). Firms in chemicals and plastics industry have steadily improved their DPS, where as textiles firms have shown a decline in the study period. Machinery firms have paid a steady DPS. Figure 4. 5 1% Trimmed Dividend Per Share by Payer Type Current Payers Initiators Regular Payers Total 0. 35 0. 3 DPS (in Rs. ) 0. 25 0. 2 0. 15 0. 1 0. 05 1991 1993 1995 1997 1999 2001 Year Table 4. 5 Distribution of Firms in terms of Dividend Per Share During 1990 – 2001 DPS Rs. Rs. 0 – 0. 25 Rs. 0. 25 – 0. 50 Rs. 0. 50 – 0. 75 Rs. 0. 75 – 1 Rs. 1 – 2 Rs. 2 – 5 > Rs. 5 Percentage of Companies in Year 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 39 41 37. 9 39. 9 41. 1 44. 9 50. 8 58. 9 64. 5 67. 5 67. 8 67. 7 45. 9 43. 1 46. 2 46. 9 45 42. 3 35. 8 27. 5 22. 2 19. 5 18. 6 18. 5 13. 5 13. 7 13 . 7 11. 2 12. 1 10. 6 10. 4 9. 8 8. 7 7. 6 7. 4 7. 8 0. 9 1. 3 1. 4 0. 9 0. 7 1. 1 1. 5 2. 3 2. 8 2. 5 2. 6 2. 7 0. 4 0. 5 0. 4 0. 7 0. 8 0. 4 0. 6 0. 6 0. 6 1. 1 1. 2 1. 3 0. 2 0. 3 0. 3 0. 2 0. 2 0. 3 0. 4 0. 6 1 1. 1 1. 4 1. 4 0. 1 0. 1 0 0. 1 0. 1 0. 2 0. 2 0. 1 0. 0. 3 0. 6 0. 4 0. 1 0 0 0. 2 0. 1 0. 1 0. 2 0. 2 0. 2 0. 3 0. 4 0. 3 Table 4. 6 Industry-wise Dividend Per Share (DPS) During 1990-2001 (in Rs. ) INDUSTRY Chemicals and Plastics Diversified Electricity Financial Services Food and Beverages Machineray Metals and Metal Product Mining Misc. Manufacturing Non-Metallic Mineral Pro Other Services Textiles Transport Equipment 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 FIRMS . 14 . 15 . 14 . 12 . 17 . 15 . 12 . 17 . 17 . 18 . 27 . 25 1138 . 19 . 21 . 26 . 20 . 20 . 19 . 21 . 22 . 21 . 22 . 27 . 21 184 . 13 . 10 . 11 . 11 . 11 . 10 . 12 . 9 . 10 . 10 . 13 . 10 58 . 08 . 11 . 13 . 34 . 24 . 21 . 28 . 12 . 15 . 14 . 19 . 18 1097 . 20 . 20 . 18 . 23 . 31 . 47 . 4 9 . 58 . 85 . 21 . 16 . 13 745 . 12 . 13 . 14 . 14 . 13 . 13 . 17 . 19 . 12 . 14 . 14 . 14 1065 . 13 . 11 . 11 . 09 . 10 . 10 . 12 . 09 . 07 . 06 . 07 . 07 555 . 05 . 07 . 06 . 07 . 09 . 06 . 07 . 08 . 13 . 10 . 11 . 09 81 . 12 . 12 . 14 . 10 . 11 . 10 . 10 . 15 . 06 . 16 . 21 . 30 324 . 10 . 11 . 11 . 09 . 09 . 09 . 10 . 08 . 08 . 07 . 09 . 09 296 . 17 . 15 . 17 . 15 . 13 . 24 . 38 . 28 . 42 . 88 . 73 . 12 1264 . 13 . 14 . 13 . 11 . 12 . 09 . 08 . 06 . 06 . 05 . 07 . 06 750 . 2 . 12 . 12 . 12 . 13 . 13 . 15 . 18 . 16 . 15 . 21 . 17 225 14 4. 3 Dividend Payout Ratio An analysis of average percentage dividend payout (PR) during 1990 – 2001 shows a volatile trend (Table 4. 7 and Figure 4. 6). Percentage PR increased from 27. 39 in 1990 to 32. 95 in 1997 and then showed a declining trend till 2000 before reaching the peak average percentage PR of 40. 53 in 2001. However, 1% trimmed average percentage PR showed a more stable pattern of around 24 percent PR up to 1997 and then has shown a declining trend before finally reaching 16. 81 percent in 2001 (Appendix Table A4. ). Table 4. 7 Average Percentage Payout During 1990 – 2001 Year 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 No. of Average Std. Firms % Payout Deviation 1382 1714 2022 2533 3156 3770 4042 4258 4335 4503 4383 3387 27. 39 25. 19 27. 54 27. 98 28. 19 25. 88 27. 44 32. 95 31. 39 22. 82 21. 6 40. 53 37. 77 41. 04 48. 31 37. 83 61. 96 38. 06 88. 12 139. 85 453. 37 120. 19 67. 49 1196. 96 1% Trimmed Average % Payout 24. 98 23. 11 24. 25 25. 72 24. 92 23. 84 23. 99 23. 91 18. 64 16. 98 17. 47 16. 81 1% Trimmed No. of Firms 1369 1697 2002 2508 3125 3733 4002 4216 4292 4458 4340 3354 An analysis of distribution of firms by dividend payout percentage shows that as high as 26 percent of firms in 1990 and 56. 6 percent in 2001 have paid out nothing (Table 4. 8 and Appendix, Figure A4. 6). However, more than 10 percent firms have paid dividend in excess of 75 percent of their net profits. An analysis of dividend payout recurrence shows that very few firms have maintained the same payout for a longer period of time (Appendix Table A4. 10 and A4. 11). For instance, only one firm – Hindustan Lever Limited – has paid out a dividend in the range of 50 to 75% of its net profit for entire sample period. Similarly another firm – Maharashtra Scooters Limited – maintained a dividend payout in the range of 10 to 20% for 11 of the 12-year sample period. Similarly, Kinetic Engineering Ltd. , Lakshmi Machine Works Ltd. , and Dalmia Cement (Bharat) Ltd. have paid out in the range of 10 – 20% for 10 of the 12-year sample period. Figure 4. 6 Average % Payout During 1990-2001 Average % Payout 50 40 30 20 10 0 1990 1992 1994 1996 1998 2000 1% Trimmed Average % Payout Average Payout % Year 15 An analysis of industry-wise DPO shows a declining trend across all industries during the sample period (Table 4. ). Diversified firms, which have a DPO in excess of 25 percent in 1990, have less than 14 percent in 2001. Firms in metals and metal products industry have registered a high degree fall in DPO from 22. 84 percent in 1990 to 8. 74 percent in 2001. Table 4. 8 Distribution of Firms’ Payout Percentage During 1990 – 2001 Dividend Payout % 0 0 – 10 10 – 20 20 – 30 30 – 40 40 – 50 50 – 75 75 – 100 100 – 200 > 200 Firms % of Firms 1990 1991 26 6. 9 14. 5 16. 5 12. 6 8. 2 10. 1 3. 5 1. 2 0. 4 1382 1992 1993 28. 9 7. 2 11. 9 13. 5 12. 3 9. 5 10. 5 4. 6 1. 3 0. 4 2533 1994 26. 6 8 14. 3 15 12. 7. 7 10. 2 4. 5 0. 9 0. 3 3156 1995 26. 7 6. 6 15. 6 16. 7 12. 5 8. 7 8. 6 3. 4 0. 9 0. 3 3770 1996 33. 3 5. 5 13. 6 13. 7 10. 8 7. 3 8. 6 5. 4 1. 4 0. 4 4042 1997 1998 1999 2000 2001 45. 4 52. 8 57 55. 8 56. 6 3. 1 3. 4 3. 4 3. 8 3. 8 7. 9 7. 6 6. 7 6. 6 7. 6 10. 9 9. 8 8. 2 8. 9 7. 9 8. 5 7. 5 6. 9 6. 7 6. 9 6. 4 5. 4 5. 2 5. 4 4. 8 9. 1 7. 8 6. 7 6. 5 7. 1 5. 2 3. 2 3. 9 4. 2 3. 2 2. 1 1. 6 1. 3 1. 5 1. 5 1. 3 1 0. 7 0. 7 0. 7 4258 4335 4503 4383 3387 26. 5 25. 3 9. 3 9. 2 14. 1 13. 9 17. 2 16. 1 12. 6 13. 3 7. 1 8. 8 9 8. 9 2. 9 2. 7 0. 9 1. 4 0. 2 0. 4 1714 2022 Table 4. 9 Industry-wise Dividend Payout During 1990 – 2001 (in %) INDUSTRY Chemicals and Plastics Diversified Electricity Financial Services Food and Beverages Machineray Metals and Metal Product Mining Misc. Manufacturing Non-Metallic Mineral Pro Other Services Textiles Transport Equipment 1990 23. 92 25. 28 17. 98 23. 28 24. 47 23. 93 22. 84 10. 28 18. 10 19. 71 20. 01 16. 83 19. 31 1991 20. 38 20. 95 16. 21 27. 01 23. 15 20. 36 21. 47 7. 29 18. 08 17. 75 21. 15 15. 98 19. 96 1992 21. 51 22. 78 14. 15 28. 50 24. 19 22. 87 19. 86 12. 28 15. 69 16. 95 19. 25 17. 26 21. 61 1993 23. 38 25. 48 13. 37 32. 11 22. 4 23. 42 20. 65 9. 56 17. 18 16. 27 19. 84 20. 98 21. 29 1994 20. 14 22. 74 12. 48 29. 87 20. 40 23. 67 20. 92 14. 04 17. 87 14. 78 21. 15 20. 54 23. 26 1995 21. 88 23. 23 16. 98 27. 25 17. 01 22. 07 19. 76 12. 10 18. 91 14. 92 19. 60 19. 20 20. 99 1996 20. 53 21. 61 12. 70 31. 74 17. 23 20. 83 18. 82 16. 58 17. 81 13. 87 19. 34 17. 30 19. 69 1997 18. 37 23. 27 16. 32 29. 19 16. 14 19. 45 16. 78 14. 65 15. 55 13. 62 17. 43 13. 84 22. 46 1998 14. 76 19. 34 10. 42 16. 12 12. 73 16. 28 12. 56 11. 50 9. 84 10. 78 14. 00 11. 29 20. 96 1999 13. 84 17. 41 9. 35 14. 82 12. 67 15. 36 9. 37 9. 87 12. 8 9. 66 12. 27 7. 99 18. 74 2000 14. 18 17. 52 12. 68 16. 21 12. 80 15. 24 9. 16 11. 98 12. 59 8. 93 12. 85 9. 04 20. 18 2001 13. 71 13. 59 13. 08 14. 30 10. 22 15. 15 8. 74 11. 76 15. 09 11. 29 12. 54 8. 02 17. 29 Total payers have registered an increase in payout from 31. 25% in 1991 to a peak of 43. 02% in 1997 and finally paid out 37. 64% in 2001 (Figure 4. 7 and Appendix Table 4. 12). Of the payers, regular payers have consistently paid higher payout compared to that of current payers. Further, initiators have shown higher fluctuations in their payout compared to that of regular payers. In sum, average percentage PR showed a more stable pattern up to 1997 and then has shown a declining trend. Analysis of dividend payout recurrence shows that very few firms have maintained the same payout for a longer period of time. Industry-wise DPO shows a declining trend across all industries during the sample period. Of the payers, regular payers have consistently paid higher payout compared to that of current payers. Further, initiators have shown higher fluctuations in their payout compared to that of regular payers. 16 Figure 4. 7 1% Trimmed Dividend Payout % by Payer Type Current Payers Regular Payers 50 Initiators Total Payers % Payout 45 40 35 30 25 20 1991 1993 1995 1997 1999 2001 Year 4. 4 Dividend Yield Average dividend yield for all companies during the period 1991 to 2001 has declined from 1. 73% in 1991 to . 55 in 1993 before finally recovering to 1. 61 in 1998 and again falling marginally to 1. 24% in 2001 (Table 4. 10 and Figure 4. 8). On the whole the dividend yield is range bound in the region of 0. 5% to 1. 73%. The reason for the fall in 1993 could be due to high increases in market capitalizations of a number of stocks in the face or irregularities in the stock market in 1992. Analysis of dividend yield by type of payer shows that initiators have always paid higher levels of dividend yield compared to that of current payers and regular payers (Figure 4. 9, and Appendix Table A4. 23). Similarly current payers have paid higher dividend yield compared to that of regular payers. Dividend yields of initiators have declined from 6% in 1991 to 1. 51% in 1993 before recovering and reaching an all time high of 10% in 1998. Compared to this current payers yielded about 5% in 1992 before falling to 1. 81 in 1993 and have subsequently recovered and reached all time high of 8. 2% in 2000. On the other hand regular payers started with a yield of close to 5% but have fallen to a low of 1. 5 in 1993 before reaching an all time high of 7. 76% in 2000. Table 4. 10 1% Upper Trimmed Dividend Yield (%)During 1991 – 2001 Year Mean Median SD Firms 1991 1. 73 . 0 2. 74 1452 1992 1. 66 . 0 2. 57 1603 1993 0. 55 . 0 0. 94 1989 1994 1. 68 . 0 3. 02 2559 1995 1. 44 . 0 2. 85 3 481 1996 1. 01 . 0 1. 88 4214 1997 1. 46 . 0 2. 99 4864 1998 1. 61 . 0 3. 80 5049 1999 1. 44 . 0 3. 86 5235 2000 1. 43 . 0 3. 96 5182 2001 1. 24 . 0 3. 15 4097 Note: Median values are considered only up to 1 decimal. However, there are non-zero values. On the whole dividend yield of aggregate payers shows a significant increase from 1991 to 2001. 17 Average dividend yield has differed from industry to industry (Table 4. 11). Diversified firms, followed by firms in electricity, food and beverages and textiles industries paid higher dividend yields in 1991 while financial services and mining firms paid the lowest. By 2001 diversified firms and electricity continue to pay higher dividend yields where firms in transport industry have improved their dividend yields by 2001. However, food and beverages and textile firms recorded lowered their dividend yield by 2001, where as firms in financial services, and mining have improved their dividend yields. Figure 4. 8 1% Upper Trimmed Dividend Yield During 1991 2001 2. 0 1. 8 1. 6 1. 4 1. 2 1. 0 0. 8 0. 6 0. 4 0. 2 0. 0 1991 1993 1995 1997 1999 2001 Average (%) Year Figure 4. 9 1% Upper Trimmed Dividend Yield by Payer Type Current Payer 12 Initiator Regular Payer Total Average (%) 10 8 6 4 2 0 1991 1993 1995 1997 1999 2001 Year On the whole the dividend yield is range bound during the study period. Analysis of dividend yield by type of payer shows that initiators have always paid higher levels of dividend yield compared to that of current payers and regular payers. Diversified firms and firms in the electricity industry have paid higher dividend yields during the study period. 4. 5 Summary of Analysis of Dividend Trends The number of firms paying dividend during the study period has shown an up trend till 1995 and has fallen subsequently. Average DPS on the other hand has shown a steady growth e xcept for year 2001. Average percentage PR showed a more stable pattern up to 1997 and then has shown a declining trend. Dividend yield measure is range bound. 18 Analysis also shows that only a few firms have consistently paid same levels of dividend. Analysis of dividend payout recurrence shows that very few firms have maintained the same payout for a longer period of time. Of the payers, regular payers have consistently paid higher payout as well as higher average dividend compared to that of current payers. Iinitiators have always paid higher levels of dividend yield compared to that of current payers and regular payers. Further, narrower indices appear to have higher dividends compared to that of broader indices. Industry trends indicate that firms in the electricity, mining and diversified industries have paid higher dividends where as textile companies have paid less dividends. Firms in the machinery industry which includes computer hardware and software segments have shown lower dividends. Table 4. 11 Average Dividend Yield (%) Industry-Wise During 1991 – 2001 Industry Chemicals and Plastics Diversified Electricity Financial Services Food and Beverages Machinery Metals and Metal Product Mining Misc. Manufacturing Non-Metallic Mineral Products Other Services Textiles Transport Equipment 1991 1. 79 2. 97 2. 27 0. 2 2. 18 1. 66 1. 76 0. 11 1. 41 1. 4 1. 18 2. 06 1. 53 Average 1% Upper Trimmed Dividend Yield in Year 1992 1993 1994 1995 1996 1997 1998 1999 1. 92 0. 55 1. 68 1. 39 0. 99 1. 55 1. 91 1. 82 2. 49 0. 8 2. 64 1. 56 1. 3 2. 16 2. 44 2. 12 1. 31 0. 69 1. 49 1. 04 1. 14 1. 07 0. 93 0. 85 0. 9 0. 41 2. 28 1. 98 1. 45 1. 87 1. 29 1. 05 2. 06 0. 58 1. 4 0. 92 0. 7 1. 21 1. 63 1. 38 1. 55 0. 61 1. 8 1. 57 1. 07 1. 54 1. 87 1. 7 1. 81 0. 53 1. 62 1. 71 1. 15 1. 43 1. 33 1. 22 0. 05 0. 01 0. 02 0. 21 0. 52 0. 45 0. 56 1. 12 0. 98 0. 33 1. 51 1. 32 0. 89 1. 18 1. 35 1. 74 1. 55 0. 49 1. 15 1. 02 0. 86 1. 08 1. 36 1. 46 1. 37 0. 5 1. 33 1. 3 0. 81 1. 23 1. 33 0. 97 1. 8 0. 62 2. 08 1. 2 1 1. 41 1. 74 1. 48 1. 48 0. 55 1. 61 1. 36 1. 22 1. 97 2. 42 2. 24 2000 1. 66 2. 99 1. 47 1. 33 1. 12 1. 32 1. 29 0. 58 1. 34 1. 66 1. 05 1. 65 2. 76 2001 1. 35 2. 11 1. 99 1. 03 1. 06 1. 01 1. 2 0. 81 1. 29 1. 43 0. 98 1. 6 2. 04 4. 6 Changes in Tax Regime and Dividend Propensity Analysis of influence of change in tax regime on dividend propensity shows that total dividend per share has come down from an average of Rs. 0. 84 to Rs. 0. 71, where as average payout percentage has increased from 33. 33% to 51. 05% (Table 4. 12). Mimicking the trends for total firms, regular payers have registered lower DPS and higher payout percentage. As opposed to these changes over sub-periods of 3 years before and after the change in tax regime, one year changes show that DPS has more or less remained at the same level, where as payout percentage has come down from 1997 to 1999. However, paired samples t-test shows that these differences are not statistically significant, except in the case of payout percentage from 1997 to 1999 (Table 4. 13). In sum, it can be inferred from the present study that tax regime changes have not really influenced the dividend behavior of Indian corporate firms and that the tradeoff theory does not hold true in the Indian context. 9 Average Dividends Before and After the Tax Regime Change Variable Total DPS (in Total Firms Rs) Regular Payers Total DPS (in Rs. ) Immediate DPS (in Rs. ) Years Average Total Firms Payout % Average Regular Payers Payout % Immediate Payout % Years Sample After Before After Before 1999 1997 After Before After Before 1999 1997 Mean . 71 . 84 1. 55 1. 72 . 22 . 22 51. 05 33. 33 60. 53 38. 07 27. 78 35. 87 N 2597 2597 765 765 4848 4848 1217 1217 1000 1000 2987 2987 SE Correlation . 17 . 519 . 24 . 27 . 241 . 71 . 06 . 426 . 05 19. 19 . 015 1. 43 23. 35 . 008 1. 68 2. 65 . 072 2. 87 Sig. .000 . 000 . 000 . 610 . 795 . 00 Table 4. 12 Influence of Change in Tax Regime on Dividend Propensity: Paired Samples T-test Difference SE After – Before Total Firms -. 13 . 21 Total DPS Regular Payers -. 17 . 70 (in Rs. ) Immediate Years . 01 . 06 Total Firms 17. 72 19. 23 Average 22. 46 23. 39 Payout % Regular Payers Immediate Years -8. 09 3. 76 t -. 62 -. 24 . 11 . 92 . 96 -2. 15 df 2596 764 4847 1216 999 2986 Sig. .536 . 810 . 909 . 357 . 337 . 032 Table 4. 13 5. Characteristics of Dividend Payers and Non-Payers 5. 1 Profitability Payers on an average have more than twice the payoff on assets compared to that of non-payers (Table 5. 1). This finding is consistent with Fama and French (2001). Of the payers Initiators appear to have on an average higher payoff on assets compared to current payers and regular payers, though their payoffs on assets have shown considerable fluctuations. Current payers and regular payers have similar levels of payoff on assets. Of the non-payers, former payers appear to have higher payoff on assets compared to firms, which never paid dividends. Never paid in turn appears to higher payoff on assets compared to current non-payers. An analysis of EPS of payers and non-payers shows that the former have on an average higher EPS compared to the latter. The difference in magnitude is also quite substantial compared to that of payoff on assets. Of the payers, regular payers have consistently higher EPS compared to that of the other two groups of payers. EPS of current payers and initiators has shown considerable fluctuations over the sample period. Initiators have higher average EPS in the early part of 1990s and last few years of 1990s, where as in the intervening years their EPS has shown a decline. Current payers on the other hand shown an opposite trend compared to that of initiators. All the non-payer groups have shown considerable fluctuations in EPS during the sample period and on average registered a decline in EPS from 1990 to 2001. An analysis of common stock earnings to book equity 20 shows that on an average payers have dominated non-payers as the former firms registered 24% in 1991 and 15% in 2001 to 4% and –6% by the latter in the corresponding years. Of the payers, initiators have higher common stock earnings to book equity compared to that of regular payers and current payers. Regular payers and current payers have similar equity earnings to book equity. However there is a gradual decline in earnings to book equity from 1991 to 2001. Of the non-payer firms, never paid firms appear to have higher equity earnings to book equity compared to current non-payers and former payers. The difference between payers and non-payers is larger in terms of stock earnings to book equity compared to payoff on firm’s assets. These findings are consistent with Fama and French. To sum up it can be concluded that profitability has positive influence on the dividend payment of a corporate firm. Dividend payers are more profitable compared to non-payers. Further, corporate firms in general and non-dividend payers in particular have become less profitable. 5. 2 Growth or Investment Opportunities An analysis of growth of assets shows that payers on an average have higher growth compared to that of non-payers. Payers have grown at percentages of 29. 03 in 1991, 23. 69 in 2000 and 10. 82 in 2001 compared to 18. 65, 4. 12 and 1. 86 in the corresponding years for non-payers. Of the payers initiators appear to have higher growth percentage compared to that of regular payers. Initiators have grown at percentages of 29. 87 in 1991, 49. 13 in 2000 and 57. 54 in 2001 compared to 28. 2, 23. 59 and 6. 78 in the corresponding years for regular payers. Regular payers in turn appear to have higher growth compared to that of current payers. Of the non-payers, never paid have on an average lower growth in assets compared to former payers and current payers. These findings are not consistent with Fama and French where they find never paid firms to have higher growth in assets compared to that of other non-payer and payer groups. Similar trends are observed with regard to growth opportunities as measured by R&D investment to total assets. Payers appear to have higher growth opportunities compared to non-payers. Of the payers, regular payers have higher growth opportunities compared to initiators and current payers. Of the non-payers, never paid appears to have lower growth opportunities compared to current non-payers. However the percentage growth opportunities for payers as well as for non-payers are considerably low as the payers on an average have 0. 02% in 1991 and 0. 27% in 2001 compared to 0. 003% and 0. 0447% in the corresponding years for non-payers. An analysis of aggregate market value to book value of assets shows that payers and non-payers do not differ significantly. However, there are differences with in the payer and non-payer groups. For instance, initiators appear to have higher market value to book value compared to regular and current payers, where as in non-payer group, former payers appear to be dominated by both never paid and current non-payers. On the whole in the Indian context higher growth and growth opportunities have not resulted in lower dividend payments by corporate firms. This finding contradicts the findings of Fama and French, whereby they contend that growth opportunities are an important reason for reduced dividend payments by firms. . 3 Size Dividend payers appear to be much larger in size compared to that of non-payers. This observation is consistent with Fama and French (2001). Average size as measured by assets of payers averaged Rs. 104. 4 crore in 1991 and Rs. 1413. 43 in 2001 compared to that of Rs. 56. 92 and Rs. 181. 20 in the corresponding years for non-payers. 21 Of the payers, regular payers have higher assets compared to that of current payers. Current payers in turn have higher assets compared to initiators. Similarly, regular payers have grown an average asset base of Rs. 112 crore in 1991 to Rs. 711 crore in 2001 compared to Rs. 54. 71 crore and Rs. 581. 48 core for initiators and Rs. 47. 11 crore in 1992 and Rs. 654. 9 crore for current payers. Of the non-payers, former payers appear to have higher assets compared to current never paid who in turn have higher asset base compared to current non-payers. Asset base of former payers has grown from Rs. 90. 14 crore in 1991 to Rs. 239. 2 crore in 2001 while in the corresponding period never paid have grown from Rs. 51. 69 crore to Rs. 80. 57 crore. However, current non-payers have registered a decline in their asset base from Rs. 3. 5 crore to Rs. 18. 73 crore during the same period. An analysis of indebtedness of firms s hows that non-payers appear to have higher levels of long-term borrowings to assets compared to that of payers. Of the non-payers, never paid appears to have higher longterm borrowings to assets compared to former payers, who in turn appear to have higher levels compared to current non-payers. Of the payers, regular payers appear to have higher long-term borrowings to assets compared to current payers. Current payers in turn have higher levels compared to initiators. On the whole, the size of assets of firms have gone up during the period 1990 – 2001 and that increased assets seems to have been financed through long-term borrowing implying pecking order of preference for funds. Table 5. 1 Characteristics of Dividend Payers and Non-Payers Year 1991 1992 1993 Average % Payoff on Assets Current Payers 11. 20 12. 23 Initiators 9. 79 15. 15 12. 57 Regular Payers 11. 69 12. 03 12. 00 Total Payers 11. 44 12. 32 12. 07 Current Non-Payers 6. 58 5. 16 3. 69 Former Payers 10. 24 7. 41 6. 23 Never Paid 4. 44 6. 71 5. 29 Total Non-Payers 5. 49 6. 68 5. 29 Average 1% Trimmed EPS Current Payers 3. 0 4. 83 Initiators 7. 05 7. 47 5. 49 Regular Payers 14. 11 12. 79 9. 07 Total Payers 13. 20 11. 97 8. 46 Current Non-Payers -1. 61 -1. 18 -0. 49 Former Payers 0. 71 -2. 72 -3. 45 Never Paid 0. 07 1. 41 -0. 88 Total Non-Payers 0. 04 0. 49 -1. 41 Average Common Stock Earnings to Book Equity % Current Payers 21 18 Initiators 29 39 27 Regular Payers 22 20 19 Total Payers 24 24 21 Current Non-Payers -15 -7 -41 Former Payers 8 -27 58 Never Paid 14 23 47 Total Non-Payers 4 13 23 Average % Growth (Assets) Current Payers 46. 25 27. 29 Initiators 29. 87 92. 24 66. 77 Regular Payers 28. 92 62. 44 32. 20 Total Payers 29. 03 63. 66 33. 0 Current Non-Payers 16. 13 2. 34 26. 55 1994 12. 67 15. 19 12. 24 12. 58 3. 16 5. 37 4. 91 4. 79 7. 30 4. 53 9. 37 8. 67 -0. 35 -1. 64 -0. 62 -0. 81 23 32 21 24 13 72 14 21 27. 95 50. 41 36. 31 36. 17 46. 48 1995 13. 99 13. 66 12. 21 12. 56 1. 99 5. 94 5. 73 5. 41 6. 95 3. 98 8. 90 8. 15 0. 28 0. 51 0. 59 0. 54 20 26 22 23 4 -65 10 -3 1996 12. 27 11. 25 12. 02 11. 99 3. 67 9. 06 3. 89 5. 61

Only the second part of the assignment needs to be done which is the final individual share portfolio review. The company is Tesco.

Introduction This report will conclude on the performance of Tesco Plc. over the previous 5-months. Performance will be based on the share-price performance, company reports as well as a comparison between J Sainsbury Plc, Morrison Plc and U.S rival Wal-mart. Major Headwinds RemainPrice CompetitionGiven the current environment, aggressive competition in the UK grocery market is the greatest headwind to continued growth. According to Kantar Worldpanel (2014) Tesco continues to lose market-share as aggressive competition from discount brands Aldi and Lidl pushes greater emphasis on Tesco’s marketing and price strategy to retain custom as both competitors plans major expansion plans in the coming years. To add, major price competition from the likes of ASDA and now Morrison’s is gaining momentum once again, (BBC Business, 2014) [Online]. Morrison’s’ aggressive plan to spend GBP1bn on cutting prices over three years will put pressure on Tesco and other supermarket operators to respond in order to protect market share. This could accelerate margin erosion across the sector in 2014 Morrison’s price cuts are likely to be funded by planned cost savings and potentially by accepting a lower margin, (Fitch Rating, 2014). They are more aggressive than the GBP1bn initiative Asda announced in November, which at the time was to be spread over five years. To limit the impact on margins, retailers will probably respond by accelerating cost cutting initiatives and investment in product ranges and store formats. Tesco has the strongest margin, but this has been shrinking for several years, (Financial Times, 2014) [Online]. It may now be pushed to rethink its pricing in order to defend market share, which has come under pressure as evidenced by weak 2013 Christmas trading. Furthermore, the above could dampen CAPEX plans for the coming years.Rise of DiscountersAs mentioned, the recent Kantar Worlpanel (2014) report cemented the rise of Aldi and Lidl; however recent reports from Tesco have attempted to downplay the threat, with little success. The CEO referred to them a s ‘niche’ players, (Tesco, 2013). However, these players control 45% of the affluent German market and are market leaders in several other large countries. We would not compare the effectiveness and the threat posed by Aldi in 2014 with that posed by Kwik Safe (disappeared) in the 1990s. It is not an informative chart in our view. CAPEX remains strongCAPEX guidance was cut to a maximum of ?2.5bn per annum, in line with market expectations. Tesco plans to cut new space additions in the UK to 700,000 sq ft in 2014/15 from 1.4mn in 2013/14. CAPEX is shifting from new space to maintenance. Having invested ?400mn in the UK Refresh programme in 2013/14, the company plans to invest ?500mn per annum in each of the next three years. This is close to ?2bn in total to complete the programme. The priority for next year is re-modelling the Extra format where the sales performance is the weakest, (Tesco, 2013).Online growth MixedA lot of focus, as expected, has been put on the increa sing movement online. With Morrison’s considering and online platform, while Waitrose moves in with more products and free delivery. Tesco announced it will reduce the fee it charges for home delivery and click & collect. While it is good that the company aims to be competitive, excessive cuts in the delivery charge would reduce margins and also incentivise the customer to order smaller quantities more frequently, making the economics a lot less attractive. The delivery charge is a tool used to distribute demand among the different time slots and days of the week. Tesco unveiled ?127Million of trading profit from online grocery (?2.5bn sales), (Tesco, 2013), suggesting a 5% margin. According to the company, all direct costs are fully charged, that is the cost of the pickers and the delivery, (Tesco, 2013). This would not include things such as store depreciation, store energy costs, rates etc. Given this, on estimated 25Million annual orders of ?100 each, the delivery fee (?4-5 per order) would account for the great majority of profit. If this delivery fee is substantially cut, so will the profit obtained. Share Performance Graph – Share Price Performance of Selected Companies – 6-Month. Data obtained from Bloomberg (2014) [Online]. Focusing on share performance (Graph 1), over the previous 6-months, Tesco Plc is down by 18.3%, however performance is still between than W.M. Morrison and J Sainsbury, whose shares have fell by 24.2% and 19.9% respectively. Given this; the grocery sector has been a weak performer on the market, given that the FTSE 100 has risen by 2% over the same period. Weakness in the sector was seen on the 12th March (circled), after the market release from Kantar Worldpanel (2014). According to Kantar Worldpanel (2014), Tesco’s market share dropped to 28.7% in the 12 weeks ended March 2. That compares to 29.6% a year ago and is the lowest level since late 2004. Adding to the company’s woes, Tesco’s sales were down 0.6 percent in the three-month period. The main issue for investors was the movement of these sales to discounters Aldi and Lidl, plus upmarket grocer Waitrose. Morrison’s also loosened further to a share of 11.1% from 11.8% a year earlier, while ASDA, a subsidiary of Wal-Mart Stores eased to 17.5%, a 0.3 point fall Y-O-Y. Sainsbury’s was the only grocer among Britain’s ‘big four’ to hold on to its market share in the period, reaming at 17%, (Kantar Worldpanel, 2014). The report noted that the big-four where competing more for a shrinking ‘middle-ground’ as consumers move to either discounters or upmarket retailers – over the past 3-years, Waitrose, Aldi and Lidl have taken a combined 3.5 points from competition, equating to ?4.4Billion in sales per year, (Kantar Worldpanel, 2014). Taking an international look, while Wal-Mart did record a small drop on the 12th March, over the 6-month period its shares are up 3%, given its exposure to the U.S economy, which has been performing strongly, supported by consumer spending.SummaryWhile the recovery in the UK economy will present opportunities for Tesco Plc, given its exposure to consumer spending through an extensive product offering, major headwinds remain as the continued expansion of discounters pose a real threat, contrary to the thoughts of Tesco management. Furthermore the price-wars between major retailers commence once again for the shrinking middle-ground of the market, margins are expected to be hit. This has the potential to derail Tesco’s expansion plans, which will impact on future performance given aggressive competition. References BBC Business (2014) [Online]: Morrison’s restructuring sparks fears of new price war, UK, BBC News. Bloomberg (2014) [Online]: Share Price Data, Available at http://www.bloomberg.com/markets/, Accessed 27/03/2014. Financial Times (2014) [Online]: Tesco Plc, Available at http://markets.ft.com/research/Markets/Tearsheets/Summary?s=TSCO:LSE, Accessed 27/03/2014. Fitch Rating (2014): Morrison’s price cuts to pressure Tesco; margins at risk, UK, Fitch Ratings Agency. Kantar Worldpanel (2014): Unprecedented change in grocery retailing, UK, Kantar Worldpanel. Tesco (2013): Annual Review 2013, UK, Tesco Plc.

Data Integration at a Urban Multicultural Community College essayEssay Writing Service

Data Integration at a Urban Multicultural Community College essayEssay Writing Service Data Integration at a Urban Multicultural Community College essay Data Integration at a Urban Multicultural Community College essayToday, the use of information technologies in the field of education becomes more and more popular. In such a situation, the question concerning the use of the effective and reliable software arises since educators and students have to share information effectively. At the same time, the information should be shared not only effectively but also safely. In such a situation, many educational institutions face considerable difficulties with selecting software that can meet their needs. In this regard, one of the major concerns of institutions is the integrity of data provided by software used by institutions. The data integrity means that information processed by software is essential for the institution. The information is processed properly and fast and all the information is relevant, available and easy to find, when needed. The data integrity implies that the information is balanced and may be available to users in th e understandable and easy for perception form. When such requirements are set, even IT professionals can face difficulties with choosing the optimal software. At this point, it is possible to refer to the empirical data based on the use of certain software in educational institutions. In this respect, it is possible to refer to the case of Powerfaids software and Jenzabar Software, the software, which has proved its efficiency but to draw the specific evidence, it is necessary to conduct the detailed analysis of Powerfaids software and Jenzabar Software and its application in the educational institution.The purpose of the project:The goal is to creatively and systematically implement a system software that will allow data to integrate from one system to another. This will create functionality across the organization.Essential Questions:What is the intent behind the implementation?What are the few important themes that need to be worked on to deliver the intent?How will the projects be led and resourced?Who will be responsible for each task?What is the review process?Projected Outcome Questions:Will this be a success for the academic school year 2014-2015 or how will success be measured?Thesis statementThe use of Powerfaids software and Jenzabar Software by the Institution can help to enhance consistently to process and communicate information and share data within the Institution with the database of the Institution being under the control of the Associate Director.Expanded thesis statementThe use of Powerfaids software and Jenzabar Software can open new opportunities for the Institution in terms of information processing and data integrity. In actuality, the Institution faces the problem of the information overload. In such a situation, the effective information processing and data integrity could resolve the problem of the information overload. Powerfaids software and Jenzabar Software can help to resolve this problem, at least partially, since this software can bring in better information processing and enhance the information integrity within the Institution. The implementation of Powerfaids software and Jenzabar Software will be conducted under the control of the Associate Director.The current problem is that the data from the Admissions office and the Financial Aid office are not being communicated effectively. As the Associate Director, the responsibility will be to update the system software routinely and to integrate the data between the two systems. In addition, the Associate Director will serve as a liaison between Information Technology and Financial Aid department to ensure correct data implementation. The Associate Director will continue to provide technical training, advice, and support to all staff membersThe project timeline and implementation is determined by the specific needs of the Institution. In fact, the project will be accomplished within a month that involves the introduction of Powerfaids software and Jenzabar Software within the Institution and training of educators, students and other stakeholders how to use software, if such training is necessary. The beginning of the training should be immediate since, otherwise, the Institution faces the risk of information overload and failure to process the important financial information in time and properly. Such failure may leads to such problems, when students pay for their tuition, but the Institution does not receive the information that the transaction was complete. The accomplishment of the project will be in one month, when Powerfaids software and Jenzabar Software should work in the Institution on the regular basis.Effectiveness of Powerfaids software and Jenzabar SoftwarePowerfaids software and Jenzabar Software and information processingPowerfaids software and Jenzabar Software help to process information fast.   The development of effective information processing software is an essential condition for the successful and effective per formance of the financial department of the institution because the growing complexity of financial transactions and operations of the Institution raises the problem of the information overload. The information overload, in its turn, raises the problem of the possible errors that may occur in the course of financial transactions as well as other problems related to financial operations conducted by the Institutions as well as students, who pay for their tuition, for example. In such a way, Powerfaids software and Jenzabar Software will help to process information effectively and minimize the risk of errors in the course of financial transactions and other operations conducted by the financial department of the Institution.Powerfaids software and Jenzabar Software contribute to the more efficient information processing since this software increases the speed of the information processing, while the risk of errors decreases since all operations are conducted automatically and autonomo usly without or with minimal interference of users. At the same time, users will not have any problems while using Powerfaids software and Jenzabar Software because this software has a user friendly interface and even inexperienced users can use Powerfaids software and Jenzabar Software without any additional training. The faster information processing naturally improves the overall performance of the financial department of the Institution.Powerfaids software and Jenzabar Software allow gathering all the information, filtering information and processing valid information only. In such a way, the information related to the financial performance of the Institution will be automated and processed by Powerfaids software and Jenzabar Software. At this point, many researchers (Garvin Artemis, 2007) point out that modern organizations face the problem of the information overload, when they cannot distinguish useful information from the information that they do not need at all. The inform ation overload in case of finance is particularly dangerous because it may lead to financial losses of the Institution. This is why the introduction of Powerfaids software and Jenzabar Software can optimize the information processing in the Institution and lead to the data integration through the data analysis and systematization.Powerfaids software and Jenzabar Software and information sharingPowerfaids software and Jenzabar Software offer excellent opportunities for information sharing making the process interactive and the entire system open for both students and educators. In this regard, it is worth mentioning the fact that both students and educators are involved into financial relations directly or indirectly. In such a situation, the use of Powerfaids software and Jenzabar Software is beneficial because this software is open and understandable, on the one hand, and this software is extremely difficult to use to hide some financial transactions or operations (Hackman Wageman , 1995). Therefore, the risk of errors or manipulation with financial resources is minimal that is apparently beneficial for the Institution, where the efficiency of fund use is traditionally one of the priorities.The data may be shared at several levels, among which it is possible to distinguish the information sharing between students and educators. In fact, data may be shared to obtain the information they may need about their current position and the correlation between their current position and their financial operations. For example, while working on projects that require financial resources, students and educators may share the financial information to ensure transparency of the fund use and the accuracy of financial calculations. In this regard, Powerfaids software and Jenzabar Software may help too (Brasure, 2014). In such a way, the data sharing helps students and educators to conduct the learning process successfully.Data Integration at a Urban Multicultural Community Co llege essay part 2