The Role Of Computer In Business

The Role Of Computer In Business

Information Technology, like language, affects us on many levels and has fast become integral to all of our lives.   In this course we aim to strike a balance in studying both the social and commercial forces of Information Technology, and networking, in particular. 

Let's take a moment here to introduce the commercial forces.

I am quite certain that each and everyone of you has witnessed first hand, even if it wasn't readily obvious, the impact that computers and computer networks have had on business.

In fact, by now the role of computers in business has risen to the point where computer networks, even more than personnel, are synonymous with the corporate entity.  Is this not true?

What do I mean?  Dell Computers ? isn?t a group of people making and selling personal computers as much as it is a collection of loosely affiliated computer systems that, upon receiving an order or customer service request (all online!), come together in a linear process to do a job.  Cisco Systems ? isn?t so much a manufacturer of switches as it is a trusted brand name and expert marketer who happens to use the Internet and a sophisticated ?network of networks? to weave together suppliers, manufacturers, and distributors to form a coordinated, fully branded, fully customized virtual entity that we know as Cisco.   When orders slowed in 1999, Cisco?s response involved rationalizing their supply-base ? leaving capital-intensive subcontractors to squeeze already razor thin margins just to participate in the new, leaner, and ever-responsive sales network.  Indeed Cisco?s information systems are their competitive advantage.

Computers and computer networks act as the central nervous system of today?s enterprise.  Today's regular business people aren?t just relying on them...they're directly administering, monitoring, and configuring them.   While IT staff with specialized skills may focus on application development, integration, and support, today?s business professional requires information technology knowledge to navigate and operate IT systems, to design, customize, and test systems for competitive advantage, and to seek out and identify new solutions that can transform their business. 

Employees in a business come into the company already capable of interacting with each other to share information and create new projects. They are connected in a network of speech. In nearly every business those same employees are using computers. Each of those computers are used to perform the employee’s job, so wouldn’t it make sense that they too communicate like their users?

Many businesses are starting to agree, by networking all company computers in local area networks or LANs. In this arrangement each computer can connect to the other, increasing the interaction capability of the entire business.

The basic need of for most computers to interact in a business is to share files. It’s true this can be done with email, but there is always the issue of a file being saved on someone’s computer who is absent. With a network, any employee can retrieve the same files when needed. And when networked, large projects are much easier to transfer than through email alone. It is also a better medium for collaboration as employees can pass files back and forth, as well as brainstorm, much more efficiently in an open setting in which additional workers can make suggestions.

Additionally, computer networks can be outfitted with remote access so employees can grab and share files from outside of the office like on their home computers or smartphones. It is an ideal system for businesses with employees that need to travel and still access information when needed.

Employing a network can in some cases save money for a business in equipment costs as well. For example, printers. Instead of purchasing multiple printers for various groups, a single high-end printer can be linked to the computer network and used by all.

A successful business is an organized business, and with a networking system each employee can stay organized by staying on the same page. Employees can share project schedules directly across the network and make changes appropriately.

OPINION: The advent of computers has revolutionized the workplace and redefined operational practices. The use and deployment of computers, computer systems and information technology (IT) applications in every aspect of business is now commonplace. The recent application and adoption of Web-based, information and telecommunication technologies has force-multiplied the capabilities and benefits of computers. The importance of computers in business cannot be overstated

SOURCE:

http://www.itworkers-alliance.org/the-importance-of-computer-networks-in-business.html

http://exonous.typepad.com/mis/2004/09/the_role_of_com.html

Import and Eksport

Import and Eksport

In recent months one of the most commonly asked questions I have been receiving about the Import Export Business Toolkit training course is from non-USA residents who are rightfully concerned that the information provided in the course will not be helpful to them.

My general reply is that the Importing course part of the toolkit is more USA centric than the Exporting part.  Overall the toolkit is composed approximately 30% on starting an Importing business and 70% on starting an Exporting business.

I feel the Exporting business holds far more opportunity for success in International trade in the USA right now and for that fact most of the world.  There is far more help and assistance available for an exporter from both business and government organizations than there is for an importer.

One note I would also commonly answer to inquiries about how useful the exporting information is to someone outside the USA was that the only portion that would "not" be useful would be the USA government and business organizations that provide support to exporters.

Beyond these USA government and private organization office addresses, phone numbers etc that are in the course, the course covers everything anyone anywhere in the world needs to start and operate an exporting business. Period

Then an email arrived in my inbox about two weeks ago that made me question that I may be wrong about Non-USA persons not being able to benefit from USA government and private business organizations exporting business assistance.

I will post the body of the message I received at the end of this post and as you will clearly see when you click over to the USA government office that the email came from, you can benefit from their export assistance.

The short email received was about National Export Initiative Priority Markets: Vietnamand there is a short video at their website along with other information that is extremely helpful to "any" exporter looking for new markets or to expand into markets they may already be selling into.

So my view has now changed, primarily due to the Internet.

The evolution of the Internet has brought information that once had to be sent my mail or other means and in an effort to get the latest and best resources into the hands of exporters, both government and private organizations are posting it freely on their websites.

In many instances, you can sign up for free email notifications to be informed at the moment any new valuable resource comes available.  With so many free email accounts being used, anyone with Internet access and an email address can now access just about ALL the resources that a USA exporter has available.  The Internet has really opened the door to anyone in the world to benefit from the export business resources that were once exclusive to USA exporters.

OPINION: I feel the Exporting business holds far more opportunity for success in International trade in the USA right now and for that fact most of the world.  There is far more help and assistance available for an exporter from both business and government organizations than there is for an importer.

SOURCE: http://importexportbusiness.blogspot.com/

Modern Banking

Modern Banking

The following figures for 1996 are from the Bank of Canada Review, Spring 1997, and Statistics Canada.  In 1996 the GDP (gross domestic product) was $797.8 billion.  The federal debt was $469.4 billion or 58.1 percent of the GDP.  Interest payments on the federal debt—mostly financed with interest-bearing bank created money (BCM) rather than interest-free government created money (GCM)—amounted to $45.3 billion.  The interest on the 6.7 percent of the federal debt held by The Bank of Canada and other government agencies flows back to government on our behalf.  The approximately $42.2 billion in interest on the remaining 93.2 percent of the federal debt held by private banks and other members of the financial elite, domestic and foreign, is basically a subsidy to the wealthy.  For reasons that have nothing to do with economic sense and everything to do with the fact that money buys political influence our government taxes ordinary citizens to pay for that subsidy.  Assuming 15 million taxpayers (children and poor people don’t pay taxes) we divide $42.2 billion of interest by 15 million and get an average of $2813 per taxpayer.  But when you add provincial and other public debt to the federal debt you get a total of approximately $650 billion.  So let’s say about $3500 per taxpayer.

Now what about private debt?  If you have a $160,000 mortgage or small business loan at 7 percent, and it is amortized over 25 years, then your average annual interest will be $7242.  (Over the 25 year period you’ll pay $181,050 in interest, which is more than the principal.)  Yet there’s no economic reason why a government agency couldn’t create and lend you that $160,000 at just enough to cover the cost of administering the loan, say 0.25 percent.  Now your annual interest would be $206.

Here’s another way of looking at the folly of BCM.  In 1999 bank credit amounted to $557 billion, almost 95 percent of our money supply. Real interest (i.e. nominal interest minus inflation) on this bank credit was at least 5 percent, or $28 billion. But where is this interest to come from since banks create credit, but not the interest they charge on that credit? It can’t come from the approximately $32 billion in cash (GCM) that circulates in public hands. It can only come from more bank credit with more interest attached. But for all existing bank credit to be paid without anyone defaulting on their loans, the economy must expand by 2.9 percent ($28 billion of interest divided by the GDP, $953 billion). Since the average annual real GDP growth from 1960 to 1995 was only 2.3 percent, the economy is going to repeatedly stumble in its effort to keep up with the interest payments on all that bank credit. This is the root cause of what is known as the business cycle, and there’s nothing inevitable about it. A lot of economic weather is man made. It is tolerated because it is the consequence of a system designed to provide investment income to those with financial assets. The cost to the community is increasing public and private debt with all the economic failure and misery that goes with it when the economy slows. What we have in a debt money system is cruelty motivated by self-interest and rationalized under the guise of economic law.

BCM should be abolished just as slavery was abolished.  But it won’t happen until the public understands the magnitude of this hidden injustice and screams blue murder.  But better scream soon.  With weapons like NAFTA and the MAI international banking fraternities, such as the International Monetary Fund (IMF) and the Bank for International Settlements (BIS), will soon have the middle class in their gun sights.  They may use a crashing stock market as a smoke screen to contract the money supply as did the Fed in 1929.  (In a radio interview in 1996 free-market champion and economic advisor to Nixon and Reagan, Milton Friedman said, “The Federal Reserve [the privately owned U.S. central bank] definitely caused The Great Depression by contracting the amount of currency in circulation by one third from 1929 to 1933”.)  Then the screams will be deafening.  But it’s better to cry out before you are hurt than after you are hurt, especially after you are critically hurt.

Do you want to take some action?  First discuss this with family and friends.  Then send a few emails containing the link to this webpage.  For the really committed ask your local bank manager just how much truth there is in the claim that banks siphon off wealth from the community through their unjust privilege of creating interest-bearing money.  (Government created money is interest-free.)  You can be fairly sure he or she will resort to their much feared weapon—impenetrable economic jargon.  Some bankers will actually deny that banks create any money!  This is an example of what Marshall McLuhan called motivated ignorance.

OPINION: Modern Banking focuses on the theory and practice of banking, and its prospects in the new millennium. The book is written for courses in banking and finance at Masters/MBA level, or undergraduate degrees specialising in this area. Bank practitioners wishing to deepen and broaden their understanding of banking issues may also be attracted to this book. While they often have exceptional and detailed knowledge of the areas they have worked in, busy bankers may be all too unaware of the key broader issues. Consider the fundamental questions: What is unique about a bank?and What differentiates it from other financial institutions? Answering these questions begins to show how banks should evolve and adapt - or fail. If bankers know the underlying reasons for why profitable banks exist, it will help them to devise strategies for sustained growth.

SOURCE: http://www.basicincome.com/basic_banks.htm

Money and its Functions

Money and its Functions

Money is a thing that is usually accepted as payment for goods and services as well as for the repayment of debts.

Money originated as commodity money, but almost all contemporary money systems are based on concept of fiat money. Fiat money is of no value as a physical commodity, and derives its value by being declared by the government to be a legal tender; that is, it must be accepted as a form of payment within the boundaries of the country. This applies for "all debts, public as well as private".

The money supply of a country consists of currency and demand deposits of bank money. Currency consists of banknotes and coins and demand deposits or 'bank money' consist of balance held in checking accounts and savings accounts. These demand deposits usually account for a much larger part of the money supply as compare to currency. Bank money is intangible. It exists in the form of various bank records. Although it is intangible, bank money still carries out the basic functions of money, being generally accepted as a form of payment.

Functions of Money

Money is best defined based on the functions that it performs as "anything that is widely used for making payments and accounting"

Money is considered as -

• Store of value
• Common measure of value
• A means of payment
• Medium of exchange
• Unit of account

In order to function as a store of value, money should be capable of being reliably saved, stored, as well as retrieved. It should also be predictably usable as a medium of exchange once it is retrieved. The value of money must also remain stable over a period of time.

When money is used for carrying out the exchange of goods and services, it is functioning as a medium of exchange. It thus avoids the inefficiencies of barter system, like the 'double coincidence of wants' problem.

A unit of account is nothing but a standard numerical unit of measurement of the market value of goods, services, and several other transactions. It is also known as a "measure" or "standard" of relative worth and "standard" of deferred payment. A unit of account is a necessary prerequisite for the purpose of formulation of commercial agreements which involve debt. In order to function as a 'unit of account', whatever is being used as money should necessarily be:

• Divisible into number of smaller units without any loss of value
• Fungible: meaning that one unit or piece should be perceived as equivalent to any other, which is why real estate, diamonds, or works of art cannot be considered as money.
• A specific size, weight, or measure to be verifiably countable.

Types of Money

• Commodity Money - Commodity money value is derived from the commodity out of which it is made. The commodity itself represents money, and the money is the commodity. For instance, commodities that have been used as mediums of exchange include gold, silver, copper, salt, peppercorns, rice, large stones, etc.
• Representative Money - is money that includes token coins, or any other physical tokens like certificates, that can be reliably exchanged for a fixed amount/quantity of a commodity like gold or silver.
• Fiat Money - Fiat money, also known as fiat currency is the money whose value is not derived from any intrinsic value or any guarantee that it can be converted into valuable commodity (like gold). Instead, it derives value only based on government order (fiat)
• Commercial Bank Money - Commercial bank money or the demand deposits are claims against financial institutions which can be used for purchasing goods and services

OPINION: Money does not just consist of notes and coins. Only about 3 to 5% of the UK’s money supply consists of actual cash. Most money is held as deposits in banks and other financial institutions. The bulk of these deposits only appear as book keeping entries in these institutions accounts. It is possible for people to access this money in their accounts through the use of debit cards, cheques, standing orders, direct debits etc without the need for cash. This means that banks and other financial institutions need to keep only a small percentage of these deposits in their safes and at their counters in the form of cash.

SOURCE:

http://www.tax4india.com/finance-and-economy-india/money-and-its-importance.html

why finance ?

why finance ?

Why finance ?
One of the primary considerations when going into business is money. Without sufficient funds a company cannot begin operations. The money needed to start and continue operating a business is known as capital. A new business needs capital not only for on going expenses but also for purchasing necessary assets. These assets-inventories, equipment, building, and property represent an investment of capital in the new business.
How this new company obtains and uses money will, in large measure, determine its success. The process of managing this acquired capital is known as financial management. In general finances securing and utilizing capital to start up, operate and expand a company.
To start up begin business, a company needs funds to purchase essential assets, support research and development, and buy materials for production. Capital is also needed for salaries, credit extension to customers, advertising, insurance, and many other day-to-day operations. In addition, financing is essential for growth and expansion for a company. Because of competition In the market, capital needs to be invested in developing new product lines and production tecnigues and in acquiring assets forduct lines and production technigues and in acquiring assets for future expansion.
In financing business operations and expansion, a business uses both short-therm and long-term capital. A company, much like an individual, utilizes short-term capital to pay for items that last a relatively short period of time. An individual uses credit cards or charge accounts for items such as clothing or food, while a company seeks short-term financing for salaries and office expenses. On the other hand, an individual uses long-term capital such as a bank loan to pay for home or car goods that will lasy a long time. Similary, a company seeks long term financing to pay for new assets that are expected to last many years.
Whwn a company obtains capital ffrom external sources, the financing can be either on a short-term or long-term arrangement. Generally, short-term financing must be repaid in less than one year, while long-term financing can be repaid over a longer period of time.
Finances involves the securing of funds for all phases of business operations. In obtaining and using this capital, the decisions made by managers affect the overall financial success of a company.

OPINION:

One of the primaryconsiderations when  going into business is money. Without sufficient funds a company cannot begin operations. The money needed to start and continue operating a business is known as capital. A new business needs capital not only for ongoing expenses but also for purchasing necessary assets. These assests-inventories, equipment, buildings, and property represent an investment of capital in the new business.

SOURCE: http://wartawarga.gunadarma.ac.id/2012/03/why-finance/

The Balance Sheet

The Balance Sheet

In financial accounting, a balance sheet or statement of financial position is a summary of the financial balances of a sole proprietorship, a business partnership, a corporation or other business organization, such as an LLC or an LLP. Assets, liabilities and ownership equity are listed as of a specific date, such as the end of its financial year. A balance sheet is often described as a "snapshot of a company's financial condition".^[1] Of the four basic financial statements, the balance sheet is the only statement which applies to a single point in time of a business' calendar year.

A standard company balance sheet has three parts: assets, liabilities and ownership equity. The main categories of assets are usually listed first, and typically in order of liquidity.^[2] Assets are followed by the liabilities. The difference between the assets and the liabilities is known as equity or the net assets or the net worth or capital of the company and according to the accounting equation, net worth must equal assets minus liabilities.^[3]

Another way to look at the same equation is that assets equals liabilities plus owner's equity. Looking at the equation in this way shows how assets were financed: either by borrowing money (liability) or by using the owner's money (owner's equity). Balance sheets are usually presented with assets in one section and liabilities and net worth in the other section with the two sections "balancing."

A business operating entirely in cash can measure its profits by withdrawing the entire bank balance at the end of the period, plus any cash in hand. However, many businesses are not paid immediately; they build up inventories of goods and they acquire buildings and equipment. In other words: businesses have assets and so they can not, even if they want to, immediately turn these into cash at the end of each period. Often, these businesses owe money to suppliers and to tax authorities, and the proprietors do not withdraw all their original capital and profits at the end of each period. In other words businesses also have liabilities.

A balance sheet summarizes an organization or individual's assets, equity and liabilities at a specific point in time. Individuals and small businesses tend to have simple balance sheets.^[4] Larger businesses tend to have more complex balance sheets, and these are presented in the organization's annual report.^[5] Large businesses also may prepare balance sheets for segments of their businesses.^[6] A balance sheet is often presented alongside one for a different point in time (typically the previous year) for comparison.^[7][8]

[edit]Personal balance sheet

A personal balance sheet lists current assets such as cash in checking accounts and savings accounts, long-term assets such as common stock and real estate, current liabilities such as loan debt and mortgage debt due, or overdue, long-term liabilities such as mortgage and other loan debt. Securities and real estate values are listed at market value rather than athistorical cost or cost basis. Personal net worth is the difference between an individual's total assets and total liabilities.^[9]

[edit]US small business balance sheet

Sample Small Business Balance Sheet[10]
Assets		Liabilities and Owners' Equity
Cash	$6,600	Liabilities
Accounts Receivable	$6,200	Notes Payable	$30,000
Tools and equipment	$25,000	Accounts Payable
		Total liabilities		$30,000
		Owners' equity
		Capital Stock	$7,000
		Retained Earnings	$800
		Total owners' equity		$7,800
Total	$37,800	Total		$37,800

A small business balance sheet lists current assets such as cash, accounts receivable, and inventory, fixed assets such as land, buildings, and equipment, intangible assets such as patents, and liabilities such as accounts payable, accrued expenses, and long-term debt. Contingent liabilities such as warranties are noted in the footnotes to the balance sheet. The small business's equity is the difference between total assets and total liabilities.^[11]

[EDIT]PUBLIC BUSINESS ENTITIES BALANCE SHEET STRUCTURE

Guidelines for balance sheets of public business entities are given by the International Accounting Standards Committee (now International Accounting Standards Board) and numerous country-specific organizations/companys.

Balance sheet account names and usage depend on the organization's country and the type of organization. Government organizations do not generally follow standards established for individuals or businesses.^{[12][13][14][15]}

If applicable to the business, summary values for the following items should be included in the balance sheet:^[16] Assets are all the things the business owns, this will include property, tools, cars, etc.

[edit]Assets

Current assets

1.    Cash and cash equivalents

2.    Accounts receivable

3.    Inventories

4.    Prepaid expenses for future services that will be used within a year

Non-current assets (Fixed assets)

1.    Property, plant and equipment

2.    Investment property, such as real estate held for investment purposes

3.    Intangible assets

4.    Financial assets (excluding investments accounted for using the equity method, accounts receivables, and cash and cash equivalents)

5.    Investments accounted for using the equity method

6.    Biological assets, which are living plants or animals. Bearer biological assets are plants or animals which bear agricultural produce for harvest, such as apple trees grown to produce apples and sheep raised to produce wool.^[17]

[edit]Liabilities

See Liability (accounting)

1.    Accounts payable

2.    Provisions for warranties or court decisions

3.    Financial liabilities (excluding provisions and accounts payable), such as promissory notes and corporate bonds

4.    Liabilities and assets for current tax

5.    Deferred tax liabilities and deferred tax assets

6.    Unearned revenue for services paid for by customers but not yet provided

[edit]Equity

The net assets shown by the balance sheet equals the third part of the balance sheet, which is known as the shareholders' equity. It comprises:

1.    Issued capital and reserves attributable to equity holders of the parent company (controlling interest)

2.    Non-controlling interest in equity

Formally, shareholders' equity is part of the company's liabilities: they are funds "owing" to shareholders (after payment of all other liabilities); usually, however, "liabilities" is used in the more restrictive sense of liabilities excluding shareholders' equity. The balance of assets and liabilities (including shareholders' equity) is not a coincidence. Records of the values of each account in the balance sheet are maintained using a system of accounting known as double-entry bookkeeping. In this sense, shareholders' equity by construction must equal assets minus liabilities, and are a residual.

Regarding the items in equity section, the following disclosures are required:

1.    Numbers of shares authorized, issued and fully paid, and issued but not fully paid

2.    Par value of shares

3.    Reconciliation of shares outstanding at the beginning and the end of the period

4.    Description of rights, preferences, and restrictions of shares

5.    Treasury shares, including shares held by subsidiaries and associates

6.    Shares reserved for issuance under options and contracts

7.    A description of the nature and purpose of each reserve within owners' equity

Opinion

In financial accounting, a balance sheet or statement of financial position is a summary of the financial balances of a sole proprietorship, a business partnership, a corporation or other business organization,

SOURCE: http://en.wikipedia.org/wiki/Balance_sheet