Police Corruption in America Essay - 1699 Words

Police Corruption in America The police officer stands at the top of the criminal justice system in a nation where crime rates are high and where the demands for illegal goods and services are widespread. These conditions create a situation in which the police officer is confronted with opportunity to accept a large number of favors or grants. Police corruption occurs in many forms and observers of police behavior agree that it falls into nine specific areas. Drug related police corruption differs from other types of police corruption. In addition to protecting criminals or ignoring their activities, officers involved in drug related corruption were more likely to be involved in stealing drugs and/or money from drug dealers,†¦show more content†¦Unbelievably, there are cases of corruption that are far worse. Two have been charged with keeping a brothel, for which they are alleged to have kidnapped a 15-year-old virgin. Another officer set up a childrens home, which he advertised as a charity. Charl ies Shelter in fact offered young boys for sex. The local police record an unusual number of suicides and mysterious incidents of heart failure. One detective failed to notice that a tourist, whom he diagnosed as having been beaten to death, had been shot at point-blank range. Perhaps the officer in question was distracted by the strain of managing his second-hand car business. The people in charge of the police organizations are not blind to what is going on; some are just too scared to admit that there are corrupt officers in their force. Others may just really not know what is going on while the rest are either involved in the corruption or speaking up and trying to stop the dishonesty. For example, Roy Penrose, director-general of a new squad, warned the public that a small but significant number of officers were known to be selling police information and aiding former officers and criminals as to the whereabouts of safe havens where they could go unharmed in dealing in their drug trades. He pledged to be ruthless in sacking corrupt and incompetent officers (Welch, p 13). James Wood, a formerShow MoreRelated Police Corruption in America2871 Words   |  12 Pages Police Corruption in America The missions statement of police agencies usually highlight with pride the maintenance, promotion, and protection of peace, order, safety, and justified law enforcement in communities and the entire nation. Police officers are agents meant to bust crimes and get the bad guys. The police agency that the public use to lean on as the legitimate authority figure to come to the rescue however has created conflicting public perception. 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Threats To Auditors Independence

Question: Discuss about the Threats To Auditors Independence. Answer: Threat of Intimidation and Advocacy In this case, Clarke Johnson (auditor firm) is politely threatened by its client Luxury Travel Holidays (LTH) that if Geoff (audit partner of CJ) does not promote its business at an upcoming seminar, then CJ will not be reappointed as the auditor. This is a clear threat of intimidation because LTH is imposing a forced reappointment cancellation to deprive CJ to undertake subsequent audits and hence hurting its revenues indirectly. If CJ agrees to the terms of LTH, then this poses a serious threat to its independence as the auditor of LTH. Firstly, providing such non-audit services is not justifiable, and if Geoff does promote LTH, then it leads to advocacy threat (Flood, 2017). Consequences Due to this risk the audit firm will be discouraged from acting unbiasedly due to perceived or actual pressures, including efforts to exercise unwarranted influence over CJ and Geoff. Moreover, if Geoff agrees to promote LTHs business as unduly asked by the client, then there will be a threat that CJ and Geoff will expand LTHs business to the extent that their objectivity gets compromised. Shareholders will find it difficult to trust the audit reports, and CJs reputation of an independent auditor will be at stake (Flood, 2017). Safeguards Refuse to accept the offer Refuse to accept reappointment until the condition is not eliminated Refuse to stand for reappointment Threat of Self-Interest LTHs offer of free expensive holiday package to Geoff and another member of the team gives birth to a threat of self-interest to objectivity as the gift might influence the judgment of CJ in favor of LTH. In assessing how significance is this threat, issues like the monetary value and nature of gift, and the hospitality offered to Geoff and another member, plus the motive behind the proposal needs to be considered (Gray and Manson, 2007). Consequences The threat in the current scenario of any financial or another type of interest is likely to sway the professional accountants objectivity, judgment and behaviour inappropriately. LTHs intention behind such expensive gifts is also made explicit by the company. They want the next year audit to be smooth. This is indirect bribery which if accepted by CJ which impair the objectivity of their audit report. This is because receiving the gifts would form a familiarity which will lead to self-interest threat (Gray and Manson, 2007). Safeguards: Refusing to accept the holiday package apparently Ask LTH not to extend such gifts and hospitality treatments in future Creating a policy that will restrict any member of the audit team to receive any kind of unreasonable gifts and will restrict the client to extend any such absurd Threat of Self-Interest, Familiarity and Intimidation Close personal ties among audit team members and an employee or owner of the client firm is likely to result in threats of self-interest, familiarity and intimidation to objectivity as that member of the audit team will not be appropriately skeptical of, and is likely to be sympathetic toward the employee with whom he/she has a relation. In assessing the significance of the threat present in the case, the seniority of the audit team member and of the clients employee must be considered, because the threat becomes more significant with senior people involved as they have greater influence over these things (Livne, 2011). In the present case, Michael, a fresh accountant who is being contemplated to be on the audit team is related to the client company because his father is the financial controller of LTH. Consequences - The threat of self-interest and familiarity will crop up here in the sense that Michael is not likely to objectively review the accounts because his father is employed at a senior position in the company and that too in the finance department. If any inconsistency with the accounts is found, his fathers job may be at stake. There is also a change that LTH may try to influence Michaels judgment by threatening his father about the future of his job. This will give rise of the threat of intimidation, and all these are likely to induce Michael into giving a favourable report for LTH. He may even try to influence other members of the audit team to do the same (Williams, 2016). Safeguards: Michael must not be made part of the audit team He may help with other accounts work but not the core audit of LTH If Michael is involved in the audit team, then his work should be reviewed to identify discrepancy if any Threat of Complacency, Familiarity, Self-Review and Social Bonding When the auditor becomes too trusting or sympathetic of the client due to a close relationship with the management and employees, then social bonding and familiarity threat is likely to creep in. Familiarity leads to complacency wherein the auditor does not practice scepticism and is too sure that everything with the clients account is accurate. Moreover, when an auditor has to re-assess work done by him/her the threat of self-review emerges because he/she again becomes complacent and does not practice objectivity in reviewing own work (Basu, 2010). The present situation also involves the same case as Annette has worked with LTH and has close relationships with people in the client company. Consequences Due to her close relationships with the client firm and its employees, Annette is likely to be sympathetic to LTHs interests and may be very accepting of their work. Moreover, as she was working with the company till a month ago helping in tax calculations and accounting entries, there is a high probability of the existence of self-review and complacency threat. Resultantly, she may overlook rechecking the tax calculations and account entries, thereby impair her objectivity as an auditor (ACCA, 2012). Safeguards: If Annette is involved in the audit team, then re-checking her work because it is bound to have discrepancies Instructing other audit team members to practice extra scepticism and not become complacent. Cross-checking Annettes last transactions with LTH to ensure she does not have any financial interest in the company anymore and not receiving any unreasonable perks. Business Risks Inherent risks and control risks are the two main business risks that Crampton and Hassan would like to consider in planning the 2015 audit. On purchase of equipment, it is possible that the return on such a huge investment may not seem justifiable at the end of the payback period. Moreover, the equipment might lose its utility after a few years and result in impairment due to non-utilization. This constitutes the inherent risk. Control risk relates to the loss arising out of the inadequacies and incompetence of the companys internal system to effectively manage and protect the assets (Longenecker et al., 2013). Audit Risks Relating to the Business Risks The audit risk pertaining to internal risks is the misstatement of the asset in books of account. It is crucial to identify that the assets are recorded on correct cost basis or not. It must be ensured that the company has capitalized all costs pertaining to the acquisition and continuing use of equipment. Moreover, another audit risk relating to inherent risk is recognition of the complexity of book value computations (Saita, 2010). As far as audit risk in relation to control risk is concerned, it must be made sure that the asset management has been allocated to the correct person and there is sufficient infrastructural backup to support the asset and prevent its wear and tear. References ACCA. 2012. A question of ethics. [pdf]. Available through: https://www.accaglobal.com/content/dam/acca/global/PDF-students/2012s/sa_nov12_p7_ethics.pdf. [Accessed on 22nd April 2017]. Basu., 2010. Fundamentals of Auditing. Pearson Education. Flood, M. J., 2017. Wiley Practitioner's Guide to GAAS 2017: Covering All SASs, SSAEs, SSARSs, and Interpretations. John Wiley Sons. Gray, I. and Manson, S., 2007. The Audit Process: Principles, Practice and Cases. Cengage Learning EMEA. Livne, G., 2011. Threats to Auditor Independence and Possible Remedies. [Online]. Available through: https://www.financepractitioner.com/auditing-best-practice/threats-to-auditor-independence-and-possible-remedies?full#s4. [Accessed on 22nd April 2017]. Longenecker, G. J., Petty, W., Palich, E. L. and Hoy, F., 2013. Small Business Management. Cengage Learning. Saita, F., 2010. Value at Risk and Bank Capital Management: Risk Adjusted Performances, Capital Management and Capital Allocation Decision Making. Academic Press. Williams, T. L., 2016. The Impact of Disclosing Auditor Independence and Tenure on Non-professional Investor Judgment and Decision-making.

VENEZUELAS ECONOMY AS A WHOLE Essays - Venezuela,

VENEZUELA'S ECONOMY AS A WHOLE ECONOMY Venezuela is rich in oil and other mineral resources. Its per capita income is about average for Latin America. The country's public external debt (excluding the obligations of the central bank and PDVSA, the parastatal oil company) stood at approximately $26.5 billion in 1996. The economy grew by 4.5% in real terms in 1997. Consumer prices rose only 37.6% in 1997 compared to the record 103% of 1996. The government is hoping for inflation of 24% during 1998. The Venezuelan economy is making a comeback under the Agenda Venezuela, propelled primarily by the opening of the petroleum sector to foreign investment (the apertura), a far-reaching privatization program, and plans to reform public sector operations. Oil prices have shown a continual decline since 1996, which is serving to erode the budgetary surplus from 4.5% in 1996 to an estimated 1.5% in 1997. In July 1996, the Venezuelan Government and the IMF formally announced a $1.4 billion stand-by loan. The World Bank and Inter-American Development Bank are also contributing to efforts to promote fundamental structural reforms--in the judiciary, electoral system, and social security/severance pay programs. Petroleum and Other Resources Venezuela's economy is dominated by petroleum, and the country is a founding member of the Organization of Petroleum Exporting Countries (OPEC). In 1997, this sector accounted for more than one-quarter of GDP, almost three-quarters of export earnings, and almost half of central government's revenues. Most of Venezuela's energy exports consist of crude oil, but the country is also the United States' leading foreign source of refined petroleum products. The Government of Venezuela has opened up much of the hydrocarbon sector to foreign investment, promoting the establishment of massive new petrochemical joint ventures and reactivation of inactive fields. The Venezuelan petroleum corporation and foreign oil companies signed eight contracts for exploration and production joint ventures in July 1996. These contracts are expected to generate over $15 billion in foreign investment. A range of other natural resources, including iron ore, diamonds, coal, bauxite, hydroelectric power, gold, and nickel are in various stages of development. In 1996, CVG, the state-owned mining firm, announced its first joint venture with a foreign company to develop the Las Cristinas gold mine. Congress is also considering legislation which would update Venezuela's 1945 mining law in an effort to encourage greater private sector participation in mineral extraction. Manufacturing, Agriculture, and Trade Manufacturing contributed 15.6% of GDP in 1997. The manufacturing sector grew slightly (2.2%) in direct contrast with the contraction in 1996. Venezuela manufactures and exports steel, aluminum, textiles, apparel, beverages, and foodstuffs. It also produces cement, tires, paper, and fertilizers, and assembles cars for both the domestic and export market. The Agenda Venezuela envisions the privatization of a range of state-owned enterprises, including banks. Agriculture accounts for 4% of GDP, 12% of the labor force, and 24% of Venezuela's land area. Venezuela exports beef, rice, coffee, and cocoa. However, the country is not self-sufficient in most areas of agricultural production and imports about 60% of food consumed. In 1996, U.S. firms exported approximately $475 million of agricultural products including wheat, soybeans, corn, soymeal, and cotton to Venezuela, our third-largest agricultural export market in Latin America. The U.S. usually accounts for slightly more than a third of Venezuela's food imports. Thanks to petroleum exports, Venezuela usually posts a trade surplus. In recent years, non-traditional (i.e. non-petroleum) exports have been growing rapidly but still constitute only about one-fourth of total exports. The United States is Venezuela's leading trade partner. During the first 10 months of 1997, the United States registered $3.0 billion in exports (about 38% of Venezuela's total) and purchased $12.9 billion in imports (about 55% of Venezuela's total). Venezuela's trade with other Andean Pact members, particularly Colombia, is growing in importance. Labor and Infrastructure Venezuela's labor force of about 8.8 million is growing faster than total employment. At the end of 1997, official unemployment was 12.8%, but unofficial estimates are higher. The public sector employs 14% of the work force, while less than 1% work in the capital-intensive oil industry. About 25% of the labor force is unionized. Unions are particularly strong in the public sector. Venezuela has an extensive road system. With the exception of air service, transportation and communications have failed to keep pace with the country's needs. Much of the infrastructure suffers from inadequate maintenance.

Salmonella Gastroenteritis essays

Salmonella Gastroenteritis essays There are many diseases that are caused by viruses, or bacteria. Diseases can be classified in many different ways. They could be very harmful, or acute. Salmonella Gastroenteritis is an illness that is caused by bacteria, which has three different types of shapes. Salmonella is an illness that is not deadly, or very harmful. In most cases the illness is acute, and is deadly, or extremely harmful in rare cases. Imagine being Salmonella bacteria, traveling through an individuals body. What kind of processes and obstacles would one go through? As a Salmonella bacteria, I am found in undercooked foods, such as; eggs, and turkey. In other cases I may originate from pet reptiles, like iguanas, turtles, lizards, and snakes. Bacteria like me could be found in many harsh conditions as well. They are found in both fresh and saltwater, in air, in soil, in water, and in plants, and animals. Individuals with impaired immune systems and people with very old, are young age be aware of bacteria like me. You are my favorite victims. The structure of bacteria that are related to me, are either prokaryotic, or eukaryotic. Prokaryotes do not contain a nucleus, but instead have structure called a nucleoid. The nucleoid carries the DNA in the cell. Furthermore, some bacteria may contain plasmids, which are smaller circular segments of DNA. The other bacterias are capable of movement as well. Some bacteria move with the aid of flagella, like in eukaryotes. On the other hand in Prokaryotes the flagella do not contain microtubules, and instea d have strands of protein twisted around one another like strands of rope. When I invade an individual's body, I attack their system quickly, and cause many unpleasant symptoms. I have entered the body of a thirty year old woman. She has just eaten eggs for breakfast, and forgot to cook the eggs well. Thus I was not killed, and I had the ability to enter her system. Being Salmonella bacteria, I wil...

How does Marc Webb's (500) Days of Summer qualify as a new narrative Essay

How does Marc Webb's (500) Days of Summer qualify as a new narrative - Essay Example Pop culture references of the film greatly contribute to the overall feel of the movie as a New Narrative. The first observable feature of the film is the sequence of events. It does not follow the linear narrative as what other movies do. Although the characters could resemble a next door neighbor, their beliefs are likewise, not typical. Mostly in other movies with the same genre as (500) Days, it is the female characters who are seen to be in the depressive mood every time there is a break-up. On the contrary, Summer, the female lead character possesses a more masculine outlook about love, believing that there is no such thing as â€Å"true love† and is not interested in finding a boyfriend. In one of the scenes where Tom, Summer, and another character were having a conversation, he referred to Summer as â€Å"She’s a dude† (Webb). Tom, on the other hand, is a hopeless romantic. There was even a scene where the ecstatic feeling of Tom was portrayed in a way th at it involves the whole setting of the film. A series of dance routines and an appearance of a cartooned bird were used to serve as exaggeration elements to connote Tom’s happiness. A distinct characteristic of New Narrative is its emphasis on sex and emotions.

Poems that Speak of Men's Minds Essay Example | Topics and Well Written Essays - 1250 words

Poems that Speak of Men's Minds - Essay Example Based on the titles alone, the two poems obviously talk about ball games. However, Updike is more specific in referring to basketball as he identifies the central character in his poem as a former basketball player. In contrast, Williams talks about the attitude of an audience at a ball game. Thus, although the two poems deal with the same subject matter, each has its own focus and each provides a different view of the human psyche. Comparing the two poems, Updike’s is easier to understand because of its style and language. Conversely, Williams’s use of metaphors makes the poem more difficult to comprehend yet more challenging to analyze. Updike is noted for the use of narration in his poems. Just like in his other poems, Updike uses a narrative element to express his view about ball games. The poem appears in free verse, making it easier to read and appear more realistic. The narrative element of the poem features the main character named Flick who used to be a basketb all player in high school. Like any story, the characterization is developed, giving the audience enough idea about Flick. The lines, â€Å"He was good: in fact, the best. In ’46/He bucketed three hundred ninety points† (14-15) prove the success of Flick as a basketball player. ... The persona claims that he has seen Flick set the records. This style makes the author appear as if he had known Flick since they were young, hence establishing the credibility of the writer in writing about the character and further persuading the audience to share the thoughts and feelings he has regarding the subject. Some lines of the poem talk about the achievements of Flick. These lines render a positive image of the character. However, the said lines are only used to emphasize the point of the author that there is no future in playing basketball or that a person’s popularity and skills in the field of sports will not make him win in life. To impart this message, Updike narrates how Flick ends up in blue-collared jobs working as a gas station boy, repairman, and diner despite his overwhelming basketball records. Updike does not actually elaborate on his personal views regarding the fate of Flick. Nevertheless, he uses irony and understatement to imply the bad luck that F lick ends up with. To illustrate his view, Updike uses understatement, thus: â€Å"He never learned a trade, he just sells gas, checks oil, and changes flats†¦Ã¢â‚¬  (Updike 19-20). These lines do not exactly move the audience to sympathize with Flick. Rather, they present a sad ending that the author may have observed in people like Flick, those who were once popular in school but ended up unsuccessful because they do not have other skills or expertise aside from playing ball games. Updike elaborates his view by using imagery such as â€Å"Flick stands tall among the idiot pumps—â€Å"(Updike 13) â€Å"without a head at all† (Updike 18). This is an indirect comparison between Flick and

Is fundamental analysis redundant Essay Example for Free

Is fundamental analysis redundant Essay Introduction Shortly after the stock market crash in 1929, as the first batch of financial experts in the Great Wall, Benjamin Graham and David Dodd firstly mentioned the concept in a book called security analysis: Based on public information that intelligent investors are able to analyse securities and determine whether the current price of stocks and bonds is over or below their intrinsic value. The Critical thinking and strong logic make this theory become the foundation of nearly all investments theories in Wall Street. Warren Buffett, John Neff, Peter Lynch and other famous investors become the  best practitioners in fundamental analysis. This essay will firstly introduce the related theories of fundamental analysis. Secondly, the essay will explain free cash flow model to equity valuation and the qualitative and quantitative factors of fundamental analysis. Thirdly, choosing a particular company analyses the relationships between the leading financial ratios and its stock price. Finally, indicating why financial ratios and free cash flow model cannot explain Berkshire Hathaway cooperation’s stock price changed during global financial crisis. Theory Aasuumption Metholody Theory Fundamental analysis which is based on analyzing the intrinsic value of securities, focuses on factors affecting the stock price and its trend and lets investors determine what type of securities they choose to buy and when to buy. (Lee and Swaminathan 1999, 8 )The basic assumption of fundamental analysis is that value investors believe that the market price is determined by its intrinsic value and the stock price can reflect its intrinsic value in the long term. Cash flow model Fundamental analysts use cash flow model, dividend model to roughly estimate a company’s intrinsic value. They assume that the stock price of the intrinsic value is its present value of the stream of expected cash flows and the selected reference values are based on generating the cash flow data. For example, using free cash flow model to measure intrinsic value, investors firstly assume the observed company can increase at constant rate and then choose the reference value based on a constant growth rate (g)to estimate free cash flow the next 10 years. Secondly, they calculate the present value of the 10-year cash flow based on the constantly discounted rate (k). Secondly, they estimate the terminal value P10=free cash flow*(1+g)/(k-g) and calculate its present value. Thirdly, they get the present value of the company and calculate pre- share value: equity value/numbers of shares. Rational investors can make well-informed investment decisions according to the relationship betw een market price and intrinsic value. Qualitative factors On the company level, fundamental analysis focused on two factors: qualitative and quantitative. Qualitative and quantitative analyses have a dialectical relationship. Both analyses should join together to analysis and inspect on a particular company. Although qualitative analysis is used for physical areas, with the usage to tackle non-financial information, it can be widely useful in business and finance fields.(kesh and Raja 2005, 167) The qualitative analysis of the company level is concerned with products and services, competitive advantage, management efficiency, corporate culture. Advanced products can get increasing cash inflows and improve company value (Carter and Demissew 2008, 63) because booming demand for products and services can lead to a high reinvestment rate of the company, this creates additional wealth.( Madden 2007, 125) Competitive advantage can includes producing capacity and the efficiency of a company’s design and cost controlling better than the industry’s competitors. Generating a competitive advantage for a company will creates stakeholder value. (Vilanova, Lozano and Arenas 2009, 63) The improvement of management efficiency can lower operating costs and company culture can enhance corporate image, leading to improvement of company value. Quantitative factors The quantitative factors in fundamental analysis are based on a deep understanding of financial reports which is the process of identifying opportunities and threats from the company, so investors must be concerned with the balance sheet, cash flow statement and income statement analysis. Financial statements consist of all important historical information about the company’s operation management during a specific time period (quarterly, annually). All these information provide an overview of a company’s business activities and can help managers assess the company’s wellbeing. (Dayanandan 2010, 116) Financial statement Different users are interested in different areas of the financial statements. For example, investors and equity holders are concerned with  expected earnings and dividends of the observed companies. Company’s executives usually focus on the company’s capacity. Therefore, based on historical reports, different users can get valuable information about what they concentrate on. Financial statement analysis includes selected data from financial statements to predict the company’s financial health.( Hagos and Pal 2010, 441) Applying these data from financial reports, such as profitability ratio, liquidity ratio, management efficiency ratio, debt ratio, market performance ratio analyses year by year to determine whether to buy or sell observed companies. Based on analyzing financial statements, financial analysts are able to use profitability ratio, including gross margin, ROE to indicate how efficiently revenue is generated. The liquidity ratio such as current ratio, net working capital can be used to prove the firm’s ability to generate sufficient liquidity when needed and to meet short term obligations. For example, current ratio is an indicator as a rate of current assets to current liabilities. It measures the liquidity status of a company. With a higher current ratio over time, this company will be able to meet its current obligations and experience less financial risk.( Zaki, Bah and Rao 2011, 315) Table1 Sourced by Berkshire Year ROE Total asset turnover Debt/equity P/E P/B closed Price 2003 0.105 0.588 1.32 12.7 1.34 $84280 2004 0.085 0.394 1.20 18.8 1.6 $87900 2005 0.093 0.412 1.16 15.5 1.45 $88620 2006 0.102 0.397 1.27 12.5 1.27 $109990 Table 1 above shows the some figures provided by Berkshire corporation’s annual report from 2003 to 2006. During this period, the stock price has a significant increase from $67600 in Jan 2rd, 2003 to $109990 in Dec 1st, 2006. And from 2003 to 2006, Berkshire Hathaway Inc’s net worth is $13.6billion, $8.3billion, $5.6billion and 16.9billion respectively. Graph1: Berkshire Hathaway(BRK) Inc’s stock price between 2003 and 2006 Sourced by yahoo finance The increase of Net worth can indicate the stock price’s change during this period. The gain in net worth during 2003 was $13.6billion, which increased the per-share book value of its stock by 21% from $41727 to $50498. Because of good quarterly reports and an annual report, the stock price reflected the company’s performance, rising from $67600 to $89490. However, between 2004 and 2005, the gain in net worth increased $8.3billion and $5.6billion. Although in 2004 Berkshire’s book-value gain of 10.5% fell short of the index’s 10.9% return, the net worth fell from $13.6billion to $8.3billion, leading to fluctuation of the stock price during 2004. In 2005, the net worth fell to $5.6 billion because hurricane caused loss worth of $34billion. And in the stock market, the price fluctuated and even slightly increased. However, the price reflected the company’s performance. As a multi-business company, its main business-insurance company called GEICO improved its management efficiency at nearly 32% and warranty numbers increased by 26%. On the other hand, insurance float of BRK’s insurance company increased from 46 billion to 49 billion. Due to the capital cost rate of mostly 0% and improving competitiveness, its stock price rose sharply. Financial ratios (price to book ratio and earnings per share ratio) measure share price compared to earnings, book value per share and indicate whether the market overvalues, undervalues and appropriately values the firm’ shares. Managers use to assess investors’ perceptions of future prospects. Some investors invest in stock market based on analyzing financial statements. Table2 Table2 shows mainly the relationship between the book value and stock price. Financial analysts are willing to use book value to measure the stock price. From the table 2 above, the book value of the Berkshire Hathaway increases from $14426 in 1995to $70281 in 2006 and the companys stock movements, rising from $31900 in 1995 to $110050 in 2006. In addition to particular years, these two charts reflect clearly whether a short term or a long term, the trend of the book value and stock price is roughly the same. In the long term, the growth rate of the net worth is a useful indicator to justify intrinsic value. From 1995 to 2006, the net worth of Berkshire Hathaway’s  net worth increased from $5.3billion to $16.9billion, more than 3.18 times growth during the period. Stock price had increased 3.44 times with book value 4.87 times. Although 1n 1999, the net worth fell to 0.358billion, in the long term, this company still had a significant increase in its stock market performance . Analysts also can apply activity ratios such as total asset turnover ratio and average payment ratio period to measure management effectiveness in managing its assets and to determine whether the investment in particular asset categories is too high or too low and also find out the efficiency or speed in converting accounts to sales or cash. (Dayanandan 2010, 114)Debt ratios such as debt to equity ratio and debt ratio can indicate financial leverage and the apparent financial risk assumed by the firm’s equity holders. Application Dow Jones Graph2 Dow Jones industrial index Sourced by yahoo finance Graph2 shows the change of Dow Jones industrial index before, during and after global financial crisis. The global financial crisis started in 2007 because the burst of housing bubble caused credit crisis especially in the debt markets.( McCarthy, Solomonand Mihalekl 2012, 1277 ) the stock market highly violated between 2007 and 2009. For example, in United States, the stock market increased to the peak in October 2007 with the Dow Jones Industrial Average about 14,000. After that duration, the Dow Jones dropped sharply from 12,000 in August 2008 to 6,600 in March 2009. After 2009, there is significant increase until now, rising to 14,929. Company- Berkshire Hatchaways Berkshires core business for insurance business includes the property casualty reinsurance and special class insurance company. For the past 25 years, this company has increasingly strong capital and little debt, for shareholders to create the value of more than 25% growth on average every  year. Table 3 shows analysis ratios and stock price from 2006 to 2012. Table3 Year ROE Total asset turnover Debt/equity P/E P/B closed Price 2006 0.102 0.40 1.27 12.5 1.27 $109990 2007 0.109 0.43 1.24 13.8 1.51 $141600 2008 0.046 0.40 1.41 38.16 1.71 $96600 2009 0.059 0.38 1.19 18.1 1.11 $99200 2010 0.08 0.37 1.29 14.9 1.24 $120450 2011 0.06 0.37 1.32 19 1.18 $114755 2012 0.077 0.38 1.23 14 1.1 $133000 Sourced by Berkshire Graph3 Berkshire’s stock price between 2006 and 2012 Sourced by yahoo finance The gain in net worth during 2006 was $13.6billion, which increased the per-share book value of its stock by 18.4% to $109990. In 2007, the net worth is 12.3billion, which increased the per-share book value of its stock by 11% to $141600. However, in 2008, the stock price fell to $96600, and then there is an increasing trend from 2009 to 2012. Total assets turnover ratio Total assets turnover ratio measures the management efficiency of the firm in managing its total assets to generate sales. A high ratio suggests greater efficiency. Figures shown in table3, the total assets turnover ratio during global crisis had slight change between 0.37 and 0.40. However, the stock price changed sharply, so the stock price can not reflect the stability of this ratio. ROE indicates the rate of return realized by a firms shareholders on their investments and uses as an indicator for the company’s operation. Return on equity (ROE) Return on equity (ROE) is the best indicator to learn how much money a company is making for its investors and measurement of the company’s operations. (Dayanandan 2010, 117) However, ROE is also sensitive to leverage. Assuming that proceeds from debt financing can be invested at a return greater than the borrowing rate, ROE will increase with greater amounts of leverage. From 2007 to 2008, the debt to equity ratio increased by 13.7%, from 1.24 to 1.41. However, ROE rate fell sharply from 10.9% to 4.6%. Although ROE overreact to debt change, Berkshire’s fundamental did not change in 2008. Most of Berkshires business is affected by the economic significant downward in 2009. However, its manufacturing services and retail generated a lot of cash flow and continued to consolidate their market competitive advantage. Berkshires two most important businesses: business insurance and utilities also had a good growth rate. These businesses produced a large amount of business prof its in 2008. P/E ratio P/E ratio is a common approach used by security analysts. In practice, investors usually use expected P/E ratio for the following year and analyse whether the stock price is overvalued or undervalued on the basis. P/E ratio indicates that a stock of its P/E rate over 30 is more likely to be overpriced. The P/E ratio in 2007 and 2008 is 13.8 and 38 respectively and the stock price during the period time of 2007 and 2008 is $141600 and $96600. The change of stock price is overreact to the pre-share earnings. P/B ratio P/B ratio gives some idea of whether an investor is paying too much for what would be left if the company went bankrupt immediately. From 2006 to 2009, P/B ratio increased or decreased had no direct correspondence with the stock price. However, to most companies, the book value is always lower than the stock price. Because most companies have intangible assets such as brand name, specialized skillsï ¼Å'product pricing power. These factors can not reflect in the balance sheet, but the long term trend of the market value is similar with book value. It seems that when P/B ratio increases, the gap between book value and stock price increases. On the other hand, the gap shows investors are willing to hold the stock due to its intangible assets. Cash flow model All these financial ratios cannot explain what happened in 2008 and using cash flow model to estimate the stock price also cannot explain this situation. Because investors assume the company can increase at constant rate. Although they use long-term GDP growth rate to reduce the risk of assessing value, this growth rate cannot explain and predict what happened during the investing period. They also use CAPM to measure discounted rate given by the risk-free interest rate plus a risk premium. The formula is ki=Rf+(Rm-Rf)ÃŽ ²i. However, ÃŽ ²sometimes cannot estimate risk between the market and stock. For example, a company’s market value increases from 10billion t0 20billion is less than market value of the company from 10billion to 3billion. If the company still operate well, from the market side, the risk of buying a company of the market value of 20billion is less than buying the same company of its market value of 3billion. Conclusion Therefore, during global financial crisis, fundamental analysis was useless. It is clear that during some periods the stock price is overvalued or undervalued significantly from its intrinsic value, leading to highly volatility of market price. Any market volatility is considered as irrational performances, so these market valuations caused by behavioral finance which do not have impacts on the company’s assets valuations and  operations. (Adams, Armitage and FitzGerald 2012, 157). In the long term, the trend of the stock price is similar to the trend of its intrinsic value. 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