Monday, September 30, 2019

Injustice and Justice

Injustice anywhere is a threat to Justice everywhere In the name of ALLAH the most gracious the most merciful, the Omnipresent and Omnipotent. Mr. President sir, honourable chief guest, worthy opponents and future scholars. â€Å"O believers! Be firm in justice as witnesses for God, even in cases against yourselves, your parents or your kin† â€Å"Injustice anywhere is a threat to justice everywhere. † These powerful words were said by one of American best known advocate of equal rights – Dr. Martin Luther King, Jr. According to him, all humans are caught in a patent network of sympathy.Whatever affects one directly, affects all indirectly. Hence injustice with one individual of a society can affect the life of other individuals of the society. Dear audience lets first talk about what justice really is. Justice is the ideal, morally correct state of things and persons. Justice is action in accordance with the requirements of some law. Whether these rules are grou nded in human consensus or social norms, they are supposed to ensure that all members of society receive fair treatment. Justice is distinguished from other ethical standards as required.Justice is linked conceptually, to the idea of justification: having and giving decisive reasons for one's beliefs and actions. So, attempts to understand justice are typically attempts to discover the justification – the source or basis – of justice, and therefore to account for (or disprove) its vast importance. Justice is the foundation on which the edifice of the society stands. Justice,Pakistan. Justice is perhaps the most important of the supreme values of Islam. In fact, it can be said that the main purpose of disclosure and the tasks of Prophets (alayhum salam) has been to establish Justice.Justice is the building block of the society and it is directly proportional to the truth, in order to keep check and balance in the society it is essential to maintain justice. Justice so c alled as ADAL can be seen in the early Arabian era when Hazarat Umar (R. A) was the governor General of Islamic Society. The whole society was propagated due to justified principles and teaching of Islam. He was the only ruler ever to admit that even if a dog died of hunger on the banks of river Tigris during his rule, he would be held answerable to Almighty ALLAH.It was the true spirit of justice, what the leaders of the modern world lake. Justice is like the life blood of the society which can be thick or thin, periodically, but its viscosity have a great impact in the life of the people. Justice is the first principle of social life. It can be shown to govern all relations in life: between ruler and ruled, rich and poor, husband and wife, parents and children. In all our dealings, we are required to stand firmly for justice even if it is against our own benefits.Dear youngsters of 21st century, our country, Pakistan, is facing a severe problem of bloodshed, illegal killings, suic ide bomb blast, terrorism etc. only due to the unjustified policies. Economic injustice involves the state's failure to provide individuals with basic necessities of life, such as access to adequate food and housing, and its maintenance of huge discrepancies in wealth. In the most extreme cases of misdistribution, some individuals suffer from poverty while the elite of that society live in relative luxury.Such injustice can stem from unfair hiring procedures, lack of available jobs and education, and insufficient health care. All of these conditions may lead individuals to believe that they have not received a â€Å"fair share† of the benefits and resources available in that society. Political injustice involves the violation of individual liberties, including the denial of voting rights or due process, infringements on rights to freedom of speech or religion, and inadequate protection from cruel and unusual punishment.Such injustice often stems from unfair procedures, and in volves political systems in which some but not others are allowed to have voice and representation in the processes and decisions that affect them. This sort of procedural injustice can contribute to serious social problems as well as political ones. any procedures that are carried out in a biased manner are likely to contribute to problems of religious, ethnic, gender, or race discrimination. In Pakistan our law is like a cobweb it sticks to the weaker ones but the stronger ones break it off.When the procedure in question has to do with employment or wages, such issues can lead to serious economic and social problems. In the nutshell, by setting examples of injustice we are actually creating fear in the society to fight for their basic rights. This fear is one of the major causes of our poor economy and this is the vital reason, why we are left behind from other countries. We have to make firm believe on it that Allah. It is an old saying that â€Å"absence of war does not mean pe ace, its only due to presence of justice. † Thankyou†¦

Sunday, September 29, 2019

A Study of Najdi Arabic & Arabic Language (Saudi Arabia)

If you ask a question to a Saudi Arabian, an Egyptian, an Algerian and a Syrian that which thing makes you an Arab? They will answer in just a second that speaking Arabic makes us an Arab. This language makes the Arab world and it binds the whole Arab world from Morocco to Kuwait.This language gives identity to the Arab society and makes them aware about the history of the Arab. Since the inception of Islam Arabic is the speaking language of the Islamic world. Islamic holy book the Qur’an was initially written in Arabic.There is a great religious significance of this language in the Islamic world. According to Muslims – if you want to understand properly the messages of Qur’an, you should read it in Arabic language. That’s why Arabic is not only the language of Arab world. (Seikaly, 2001)Arabic language is not only official language of Saudi Arabia, but it is also considered as an official language in more than forty five countries and dialect of Arabic is being spoken by 200,000,000 people all around the world. Main part of this population lives in the Arabic countries, but a considerable number of Arabic Speakers live in some parts of Africa. Arabic is treated as a biggest member of the Semitic branch and it is some what same as Hebrew and Aramaic.Arabic is studied widely in the Islamic world. Since 6th century Arabic is being taught as a literary language and many words of other languages had been taken from Arabic such as English and Spanish. Some words like sugar, cotton and magazine had been derived from Arabic. In Arabic these words are pronounced like sukkar, quá ¹ ­Ã… «n, maá ¸ «Ã„ zin. Some other words like alcohol, algebra and zenith came from Arabic language. (Shah, 2007)There are many verities of Arabic language. In this paper we will discuss those varieties in brief. We will mainly focus on the Najdi (A variety of Arabic language). Najdi Arabic speakers oppose the theory of generative phonology. We will move step by step and in an arranged manner.  The First Word of ArabicThe first word of Arabic, which was revealed to the Prophet Muhammad, is iqra (means â€Å"recite†).   According to literature the meaning of Qur’an is recitation. Muslims say that it was the command, which was given to the Muhammad by god, when the Prophet began to receive the revelation and this finally got converted into the Qur’an. The word Qur’an is based on the three letters, those are Q, R and A and the word iqra contains these 3 letter root. (Seikaly, 2001)Forms of ArabicArabic language can be divided in the three forms- classical, modern standard, and colloquial. The Arabic, which has been used in the Qur’an, is considered as classical Arabic. The Arabic used in Qur’an is treated as the perfect Arabic and is a stander for written form of Arabic.The modern standard Arabic is derived from the Classical Arabic and is used in the formal communication such as in literature, in news, in offices and in print media. Colloquial Arabic is locally spoken Arabic language and it varies from nation to nation and area to area. Many varieties of the Colloquial Arabic have been found in the Arab World and Najdi is one of them. In religious and social functions the oral Arabic is used for writing also because the written and spoken forms of Arabic language are highly interconnected.Modern Standard Arabic is not used at such moments. It is used in television and radio news broadcasts. Modern Standard Arabic plays an important role to bind the whole Arab world because the Arabic speakers from Lebanon and Morocco cannot easily understand one-another’s Arabic language due to their local dialects. But they can talk in Modern Standard Arabic easily.That’s why Modern Standard Arabic is used in formal meetings and occasions. Many local and regional variations have taken place in spoken Arabic and written Arabic has also been changed since 7th century. Many forei gn words are being used in Spoken Arabic such as computer, telephone, television, and radio.On the other hand lots of words have been borrowed from Arabic by the many Western languages like English, Spanish and Portuguese. In the earlier time, the Arab world was known for medicine mathematics, philosophy, and astronomy. Name of many stars are based on the Arabic language such as Betelgeuse, Rigel, Deneb, Altair, and Aldebaran. (Seikaly, 2001)The Arabic script had been taken from Nabataean Aramaic script. Originally, Arabic language had been used since 4th century but there is no solid evidence for it. Generally 6th century is treated as the starting era for Arabic language. Initially Aramaic language was there in use, but there are fewer consonants in this language. Hence in the 7th century new Arabic letters had been created with the help of dots. Then vowels came into the picture. . (Omniglot writing systems & languages of the world, 2010)Classification of varietiesThe Arabic scri pt had been taken from Nabataean Aramaic script. Originally, Arabic language had been used since 4th century but there is no solid evidence for it. Generally 6th century is treated as the starting era for Arabic language.Initially Aramaic language was there in use, but there are fewer consonants in this language. Hence in the 7th century new Arabic letters had been created with the help of dots. Then vowels came into the picture. Nowadays Arabic is spoken in many different ways in different areas. (Omniglot writing systems & languages of the world, 2010)

Saturday, September 28, 2019

Case Study: Quality Parts Company Essay

1. Which of the changes being considered by the manager of Quality Parts Company are counter to the lean philosophy of the company? Lean production is a philosophy and a way of working involving eliminating all forms of waste (where waste is defined as anything that does not add value in the production process and supply chain). Many changes being considered by the manager are counter to lean philosophy. These are: Installing an automated ordering system to help control inventories and to â€Å"keep the skids fined† implies the use of inventory as a motivator to push production; adding external inspectors; setting up a network line only institutionalizes the acceptance of rework. They could have implemented a strict quality control to ensure the quality of the products being produced by the company. Factory workers should become their own inspectors that would personally be responsible for the quality of their output. In this way, QPC can save more money and more time. Also, utilizing the labor and the machine does not coincide with lean philosophy. The focus should be more on flexibility and reducing the waste of overproduction. The installation of high rise shelving indicates an acceptance of wasteful inventory. This would just be added as a non-value step in their process. Lean philosophy leaves no room for surplus or safety stock. No safety stocks are allowed this philosophy says that, ‘If you cannot use it now, you do not need to produce it now.† Once production is done in excess, this can be considered as waste. 2. Make recommendations for the lean improvements in such areas as scheduling, layout, kanban, task groupings, and inventory. Use quantitative data as much as possible: state necessary assumptions. As we can see in the process, step 1 has one of the highest operation time and second to the highest when it comes to set up time. Therefore, adding a machine here will help improve the production of the company. The bottleneck of the process is in step 4 which includes three steps in assembling the product. With this, products were clogged to machine department before reaching the assembly bench.

Friday, September 27, 2019

Philosophy of Law Essay Example | Topics and Well Written Essays - 750 words

Philosophy of Law - Essay Example Although, I depict much abhorrence for Purple Shirts, it is necessary that we respect their philosophy that failed to permit people to present their own views on national matters. An additional difference between our current systems is that the law is applicable to everyone despite the fact that it might fail to favor some people. On contrary, Purple Shirts disregarded those laws not working in their favor. This disregarded those laws comprising of objectives not approved by them. Similarly, viewing their practices to be illegal and not acting in accordance with the law would imply that we practice exactly what we condemn. As my first deputy advises, we need to desist most of the public’s ideas on what to do, and develop a program that will resolve this dispute without allowing the public to intervene (Fuller). As highlighted by the second deputy, it would be a difficult undertaking to arraign the grudge informers to the court for their actions. Although he fails to understand how such a system of governance can be lawful, we cannot dispute the fact that they considered themselves lawful. As my deputy has argued, it would be absurd to consider Purple Shirt’s system of governance legal. Reviewing activities that Purple Shirts engaged into, acts as a clear indication that it was not a legal system. It is apparent that instead of enacting a government that adhered to laws; it allowed different categories of war to occur for which the grudge informer was among them. Therefore, our efforts to consider such acts as criminal would mean that we also endeavor to examine any other practice of those times that did not adhere to the law. The fact that... In consideration to the current regime utilizing a constitution that considers most of the Purple Shirt’s actions unlawful, an individual may consider my decision of not listening to peoples’ woes on what ought to be done to the grudge informers absurd. My argument to support such a decision is that, we cannot consider its actions as lawful, or unlawful. It is evident that what we consider, unlawful during the current regime may be was lawful during the Purple Shirt’s era. Therefore, in as much we are unwilling to address all that occurred during that regime, and which we consider unlawful according to the constitution, it is imperative that we leave the grudge informers alone. This would give us ample time to examine the different economic sectors, therefore, improving them accordingly. If there ever existed a non-democratic regime as highlighted in the current constitution is the Purple Shirt’s governance. The degree at which it practiced its evil deeds was so immense to such that judges who depicted contrasting ideologies suffered death. However, the most recent elections saw the defeat of such a regime, therefore, implementing a democratic government that was lawful. During the elections, I became the minister to implement justice. It was brought into my knowledge about the existence of a category of individuals identified as the grudge informers. These people reported those believed to have engaged in what was considered unlawful by such a regime. Therefore, alongside my panel of deputies, I have recommended on what to do to these people. It would be appropriate not to do anything to such people, since it would be expensive, as well bring about hatred.

Thursday, September 26, 2019

International currenies Essay Example | Topics and Well Written Essays - 500 words

International currenies - Essay Example Additional disclosure FACTAs new reporting requirements are much broader than the Report of Foreign Bank and Financial Accounts (FBAR). This means that individuals who may not have been subject to FBAR filing obligation may still be subject to the new reporting requirement. The major differences between FACTA and FBAR are: (1) FACTA has a higher asset threshold for disclosure at $50,000; (2) FACTA applies to a wider range of assets; (3) FACTA must be filed as an attachment to an individual tax return unlike FBAR which is filed independently of tax returns with the Treasury Department. In addition to that, FACTA added a new withholding system that requires foreign financial institutions with substantial US owners to disclose information regarding the US taxpayers. Increased penalties For starters, FACTA favors the IRS with a presumption that it is the obligation of the taxpayer to file her disclosure if she has specified foreign financial assets (Packman and Rivero 45). It also requ ires shareholders in a passive foreign investment company (PFIC) to file an annual information return disclosing their ownership regardless. The minimum penalty for failure to submit the required disclosure without reasonable cause is $10,000 which would increase by $10,000, for every 30-days of failure to submit the required disclosure, to a maximum of $50,000.

Extra credit Essay Example | Topics and Well Written Essays - 1250 words

Extra credit - Essay Example This essay is going to examine the life experience of a schizophrenic patient as she narrated her ordeal through a book. Lori Schiller suffered from schizophrenia at a young age but it was only in her adult life when the disease became excessive. Eventually she underwent medical and rehabilitation and got well, after that she wrote a book titled, â€Å"The  Quiet Room: A Journey Out of the Torment of Madness.† This book reveals the ordeal she underwent while she was suffering from schizophrenia and the book was assembled with the help of her doctor, family and friends. The story of Lori Schiller begins when she was a young girl growing up in a well to do family. Her sickness began at the age of seventeen when she was working as a camp counselor. Her sickness as is described in the book began with little voices inside her head. At first she never talked about the voices and suppressed what she felt. She went on to graduate from college and thereafter proceed to college. During her initial period of being sick, Lori did not believe that she was sick and neither did she know what she was sufferi ng from (Schiller, 1994). Lori did indeed suffer from schizoaffective since was bi-polar and at the same time schizophrenic. She also started experiencing hallucinations and this did affect her grades when she was in college. Her condition continued to worsen and she started having episodes of hallucinations making her to withdraw socially. Her social life was affected tremendously as witnessed by her testimony, â€Å"I was afraid they had heard the Voices and now knew the terrible secrets about me that they were revealing.† This shows that she avoided people and found it difficult to talk of her disease. Schizophrenic patients suffer from delusions and in most cases they are afraid to tell anyone about their problems. This is witnessed in Lori’s case when she talks of â€Å"Dr. Diane Fischer, my

Wednesday, September 25, 2019

Organisational change and development Essay Example | Topics and Well Written Essays - 2000 words

Organisational change and development - Essay Example In addition, this paper will explain two approaches that may become critical in addressing such difficulty: project management and systems approach to management. Change in Organisations There are at least three important changes in organisational life today. First, there is the case of changing the organisational goals and objectives. An organisation passes through a life cycle and that, along the way, it is inevitable to make modifications in order to address and adapt to unforeseen challenges as well as new opportunities. Managers, in these cases, revise organisational objectives in order to enforce better management and operational initiatives (Stam and Andriessen, 2009, p. 136). Changing this fundamental aspect in an organisation entails far ranging restructuring and shifts. It involves the changing the rationale behind the organisation’s existence. Secondly, there is cultural change. It is the next logical step once a strategic change is adopted or when management decide s to change the organisational goals and objectives. The rationale is that in order to achieve effective change in that direction, a gradual change in mentalities must be achieved as well (Hamalainen and Saarinen, 2004, p.143). This is crucial in changing the organisational behaviour. ... In tandem with several external variables such as the spurt of innovations in the market, the increase in competition, and the level of complexity of the supply chain, among others, it forces organisations to change. Resistance Resistance to change is inherent in every organisation. This is the general consensus in academic literature and is largely based on the principle that organisations are made up of human beings and that resistance is part of human characteristics (Passmore, Woodman and Shani, 2010, p.234). Even researchers and academics who question the assumption of such pervasiveness, tacitly recognize the inevitability of resistance when they argue in focusing on the differences and contexts in the way people respond to change (Fisher and Howell, 2004; Piderit, 2000). The human variable in this theme ensures the persistence of such behaviour and underpins the methods behind change initiatives. Several thoughts attempted to explain resistance as a concept. For example, there is the position that it is â€Å"a reactive process where agents embedded in power relations oppose initiatives by other agents† (Jermier et al., 1994, p.9). The breadth of scholarly work and empirical evidences on this subject show conceptualizations of resistance as a behaviour, emotion and belief that determine the way people respond to change (Piderit, 2000, p.786). All in all, the theoretical and empirical evidences highlight the dominant view that resistance is both negative and counterproductive in implementing change; hence, it must be addressed. An excellent way to demonstrate the difficulty in handling resistance to change at the group level is to explain the dynamics of an approach in forming a team. When one is building a team from the ground

Tuesday, September 24, 2019

Does music play a central role in the Goth scene Essay

Does music play a central role in the Goth scene - Essay Example Elsewhere goth is described in terms of an identity that is counter-culture and goes against the grain of popular society. It chooses deliberately to be unpopular and to go its own way in terms of self-development, fashion, music, and other key lifestyle aspects, including the choice of friends and activities (Urban Dictionary 2014; Williams 2006). Meanwhile, from the point of view of the rest of society, goth, the goth scene, and goth subculture tend towards the fringe and dark side of things. This is the case in fashion and in elements of popular culture such as music. That said, the mainstream seems to have mixed reactions towards Goth, with many seeing goth as a benign and a valid way for teenagers and disaffected youth to define themselves and their group (Gold and Cuda 1999). While simple definitions abound, modern day contexts for Goth and the Goth scene seem to indicate that Goth identity and the elements of Goth are fluid and are continuously evolving. There is the assertion in Daniel and Desantis (2013) that Goth as a movement of counterculture owes its staying power to the lasting appeal of its aesthetic, which is not death but persistent non-death. Goth seems to thrive by going against the mainstream. The emphasis is ongoing against what mainstream society prescribes in terms of activities, what to do, and fashion, what to wear, among other things. Moodiness and an inclination towards the dark and lonely side of things is a pervasive emotional atmosphere. This moodiness is what outside society sees from the outside looking in. As subculture, meanwhile, Goth has within it elements relating to the free expression of sexuality, defining artifacts and features that include certain fashion and musical preferences as described above (Daniel and Desantis 2013; Fereday n.d.; Wilkins 2004; Hodkinson 2005; Tumblr 2014; Smith 1997). Music too comes up inevitably in discussions of Goth, as a key

Monday, September 23, 2019

Information Technology in Contemporary Business Annotated Bibliography

Information Technology in Contemporary Business - Annotated Bibliography Example Coulson-Thomas believes: 'IT departments need to rise above equipping people to use standard corporate technologies and help key workgroups such as bid teams working on critical tasks to be more effective. Rather than spend money on infrastructure IT directors need to become more involved in revenue earning activities.' But the major problem comes out to summarizing the cost within all the departments in an organization. It comes to the count of what should be the different cost for an individual department within an organization. For any individual IT department, it requires the setup cost, with other departments as because all the departments need to make proper links with the IT department. If an organization is organized with five or six departments, then, there must have an IT department that will serve for the IT department. ...The costs of such service departments must be allocated to the production departments, which in turn will allocate them to the product. It is known that one can view the cost allocation problem as a fascinating Markov process, with the production departments as the absorbing states and the service departments as the transient states. Using Markov analysis, we will show that this yields additional insight into the underlying concept of reciprocal service department cost allocation by proving that the "full service" department costs can be used to determine the price that should be paid to an external supplier of the same service currently supplied by the service department."So far, it has a similarity with a quote that should be in mind that if the whole cost is not owed within all the departments, as per its self usages of the department by prefix schedule of target budget, they must take all the advantages of the benefits of IT resources. These sounds can be found here if we consider another example for an IT department, we can say, "Any organization can develop an IT department, getting profit developing IT department is the hard part." Nevertheless, operating a profitable IT department can be achieved with appropriate management routines in place. Determining your Cost of Goods Sold (COGS), tracking purchases and sales, and attending to the spending habits of your customers are the fundamentals of every successful IT departments.

Sunday, September 22, 2019

Synovate Survey Shows Ascending Singaporean Spending Power Essay Example for Free

Synovate Survey Shows Ascending Singaporean Spending Power Essay Synovate survey shows ascending Singaporean spending power. Synovate, a leading global market intelligence company, today released information from the 2005 Synovate PAX media survey that showed rises in wealth, product and service ownership and improvements in lifestyle across Singapores affluent residents. The Synovate PAX survey tracks media, prosperity and influence in eleven markets across the Asia Pacific region – Singapore, Hong Kong, Korea, Malaysia, Thailand, Indonesia, Philippines, Taiwan, India, Australia and Japan. Wanda Gill, Media Director for Synovate in Singapore said that the affluent of Singapore were enjoying high confidence and spending power. In just the last few months, our constantly-updated tracking has enabled us to watch Singapores ever–increasing confidence translate into higher product ownership, increasing purchase intentions and improving lifestyle. The Synovate PAX results for 2005 show that the average monthly household income of the Lion Citys affluent residents has risen from US$4,826 to US$5,456 – a 13% relative change. With greater household wealth, these Singaporeans are rewarding themselves with purchases of top tier luxury and consumer items and steady increases in property ownership and investment, Ms Gill said. The Synovate PAX survey allows marketers to get a full picture of Singapores affluent consumers – what they watch, read, buy and how they feel about advertising and branding – enabling them to target their marketing efforts. Ms Gill said that the 2005 results painted a picture of Singapore as the quiet powerhouse in relation to other markets in the region. While Hong Kongs wealthy are conspicuous consumers and buy items for their fashion status, Singaporeans tend to be more considered in distributing the fruits of their labours. Singapores elites still spend – and spend a lot – but our data shows they wont get their wallets out on a whim. Marketers must appeal to this lack of pretension and realise Singaporeans are not as status-conscious as people from Hong Kong or as acquisitive as the wealthy of other South East Asian economies which are less mature. Singaporeans are comfortable in their skins and are more likely to buy to make their lives easier, Ms Gill said. The Synovate PAX survey delves into peoples attitudes to brands and advertising via a series of psychographic statements. Some of the findings for Singapore were: * 11. 5% of Singapores elites agreed with the statement that they are among the first to buy a new product or gadget. This is below the regional average, showing that Singaporeans are less in a rush than other markets, waiting to see if the item fits into their lifestyle. More than two thirds of Singaporeans agree that paying for quality is worthwhile. * 46. 9% wealthy Singaporeans prefer to buy well known brands, well over the regional average of 41. 1%. * Singaporeans show a focus on lifestyle with 41. 5% agreeing that a home with modern appliances is important to them – this compares to the regional average of 38. 7% and 28. 9% in Hong Kong. Theres an indulgent streak across affluent Singaporeans, with one of the highest levels of agreement to the statement I sometimes like to treat myself to something special. 8. 2% of PAX respondents agreed in Singapore, with only Sydney-siders more indulgent (62%). The regional average is 48. 5%. Synovate PAX also covers product and service ownership, purchase intention over the twelve months to June 2006 and lifestyle. * As a major regional business hub of Asia, it would be expected that a great deal of business travel originates here. However, from June 2004 to June 2005, we have seen a 22% increase in Singapores affluent taking off on one or more business trips. Around 28% of these PAX respondents travel for business. But Singapores elite still find time to relax – more than 50% have taken one or more leisure trips in the year to June 2005 too. * An all-time high number of 38. 6% of affluent Singaporeans now own laptops or notebooks, up from 31. 9% in June 2004. * Likewise, ownership of a mobile phone with Internet access hits an all-time high – it stands at 37. 7% and shows steady increases for every quarter measured. This continuing trend is good news for mobile manufacturers and 3G networks and service offering planners. Indeed, more than 92% of affluent Singaporeans own a mobile with or without Internet access – they are here to stay and all these people will upgrade as mobile content becomes more and more compelling. * Digital dominance seems more and more inevitable as we observe relentless increases in Singaporean ownership of devices like MP3 players (up to 23. 1%, a rise of a quarter over the year before), digital video cameras (43. 7% now own these, up from 35. 9%) and digital still cameras (more than half of affluent Singaporeans own these an increase from 41% in 2004). Indeed, the love ffair with digital is truly blossoming. * Its fair to say that the marketers of LCD or plasma televisions have enjoyed a good year. They close to doubled their market size, with the number of wealthy Singaporeans already owning one of these TVs rising from 7. 6% to 12. 7%. And theres still a great deal of upside, with 10% expressing the intention to purchase this top tier item in the next 12 months. * Car ownership impressively jumped for the second consecutive year. At the end of June 2005, 60% of cashed up Singaporeans owned one, up from 56. 6% at the same time last year. This is an especially good sign of confidence in this very expensive place to own one – the reduction in COEs would play a significant role in this as well. And indicating that the trend is set to continue, 11. 7% of respondents intend to purchase a private vehicle over the next twelve months. * Singapores love affair with football / soccer continues – a third of PAX respondents read about it, watch it or attend games. This is up from 29. 5% last year. In fact, Singapore is really getting sporty tennis, badminton, basketball and golf all showed higher levels of interest too. With more disposable income, Singaporeans have also been getting cultural. More people have attended a concert, opera, ballet, live theatre, art gallery and museums. * The interest in quality wine continues to gain momentum. Spending on quality wine has dramatically increased from US$144 in 2004 to US$223 in 2005. This is a massive 55% relative increase. * The number of elites of the island state who own a second property is up to 10. 6%. Increases in people living in an owned property have been registered as well – 22. 9% of PAX respondents own their homes.

Saturday, September 21, 2019

Sumitomo Corporation And Yasuo Hamanakas Copper Scandal Finance Essay

Sumitomo Corporation And Yasuo Hamanakas Copper Scandal Finance Essay The financial world had been confronted heavily by trading scandals in 1995, with Japans Daiwa Bank and the rouge trader, Nick Leeson. When it seemed the scandals couldnt get much worse, the Sumitomo Copper Scandal emerged. This was the biggest scandal in the history of commodities trading and ranked in the top five trading losses in financial history up until the late 1990s. Sumitomo Corporation is a Japanese trading house, which is currently one of the largest worldwide trading companies headquartered in Tokyo, Japan. In the 1990s Sumitomo owned large amounts of both physical copper, which was stored in warehouses and factories, as well as numerous futures contracts. Copper was a relatively small market compared to other metals, such as aluminum. According to Andrew Beattles article, The Copper King: An Empire Built on Manipulation, copper is an illiquid commodity that cannot be easily transferred around the world to meet shortages. For example, a rise in copper prices due to a sho rtage in the United States will not be immediately cancelled out by shipments from countries with excess copper. This occurs because moving copper between storage and delivery costs money, which can cancel out the price differences. It is important to note that Yasuo Hamanaka was the chief copper trader of this trading house, and attempted to corner the entire worlds copper market leaving Sumitomo with a loss of more than $1.8 billion (Beattle). WHAT HAPPENED: For ten years, Yasuo Hamanaka had successfully managed to control the worlds price of copper. He eventually came to control five percent of the entire supply of copper, which may not seem like much considering ninety-five percent was in other traders hands (Beattle). However, due to the fact the abundant and cumbersome challenges that exist in the copper market (in movement, delivery, etc.) and the fact that even the largest traders in the market owned an even smaller percentage, Hamanakas five percent was indeed very significant. During the ten years of his manipulation he was able to use Sumitomos size and large cash reserves to corner and squeeze the market through the London Metal Exchange. The London Metal Exchange is the worlds biggest metal exchange. Furthermore, the London Metal Exchanges copper price essentially dictated the worlds copper price at the time (Beattle). Although the London Metal Exchange was large in size, it was fairly poor in terms of regulation. In fact, this exchange had little to no regulation at the time of Hamanakas rampant market manipulation. The Sumitomo Copper Scandal lasted for about a decade due to these negligent and almost nonexistent regulations on behalf of this particular exchange. To put the entire crisis into laymens terms, one must first understand that Hamanaka was taking a long futures position on copper and simultaneously buying up a substantial amount of physical copper as well. This caused any one trader who took a short futures position to have to buy long positions in order to cancel out their short positions. Due to the fact that Hamanaka had a large number of long positions, those people looking to buy them had to pay increasingly higher prices. These skyrocketing futures prices are what Hamanaka was able to control; the more the prices rose, the more money he made. This is because those with short positions were still paying this higher price in order to liquidate those positions. Another way that Hamanaka was making money was that while these prices continued to rise, some people holding short positions thought that instead of paying a high price for a long position they would buy the physical copper and deliver it to the holder of the long positi ons. So, because Hamanaka also owned 5% of the physical copper he could charge a very high price to those with short positions because they didnt want to keep paying money to liquidate their short positions. Essentially, he was making money by owning long futures as well as physical copper. WHY: There are no assured reasons as to why Hamanaka engaged in such illegal trades. Perhaps he felt pressured to maintain the consistent levels of annual revenue for Sumitomos traditional copper business-about ten billion dollars. He would therefore maintain his reputation as a phenomenal copper trader as well as his firms dominance in the commodities market. It is also important to note that individuals such as Hamanaka, do attempt to corner the market in order to create an unfair advantage by purchasing a significant amount of shares. This eventually increases the price of shares, making them appear to have a greater value. As the price of the shares continues to rise, more buyers become attracted, and then demand further increases the price of the shares. This causes short sellers to be driven out of the market through a short squeeze. In the article Short Squeeze, it explains that a short squeeze is a situation in which an increase in the price of the stock triggers a rush of buying activity among short sellers. Therefore, it is necessary for the short sellers to buy stock in order to close out their short positions to minimize their losses, causing a further increase in stock prices. Overtime, this causes one to sell their holdings at an artificially inflated price and then leave their investment or opt to sell their shares with the knowledge that the price will decrease once normal supply and demand forces return (Investing Answers). WHO WAS RESPONSIBLE: Yasuo Hamanaka, also referred to as Mr. Copper, was the former copper trading chief for Sumitomo Corporation. Following research of the Sumitomo Copper Scandal, one can confidently say that Hamanaka is the key player who is held responsible for the 2.6 billion dollar loss over a ten-year period. In fact, the article, Sumitomo Corporation states that, it believed that Mr. Hamanaka was solely responsible for the unauthorized trading (215). His attempted action to corner the worlds entire copper market by falsifying financial records and forging signatures alluded to such a significant loss for the company. It is also important to note that prior to the discovery of Hamanakas accumulation of illegal trades, he was given a great amount of responsibility within the company. This was because he was perceived by top executives to have superior knowledge and experience within copper trading. Therefore, one can also conclude that the top executives within the corporation can also be held responsible for the Sumitomo Copper Scandal. This is because the Sumitomo Corporation and senior management did not have secure safeguards in place to ensure that they knew exactly what their employees were doing. Furthermore, Hamanakas reputation as being a superstar copper trader only worked to solidify the lack of regulation and discipline (Sumitomo Corporation). When Sumitomo Corporations reputation began to tarnish from individuals outside the company, they responded to the allegations by stating that Merrill Lynch and JPMorgan Chase were the two banks responsible. In the article The Copper King: An Empire Built On Manipulation, author Andrew Beattle explains that Sumitomo Corporation claimed that Merrill Lynch and JPMorgan Chase granted the loans to Hamanaka via future derivatives; hence the two banks kept the scheme going. Consequently, both banks were found guilty to some extent (Beattle). RIPPLE EFFECTS ON THE MARKET: Historically, there has been a close correlation in the behavior of metal prices. When one metal falls, the others tend to follow. However, the Sumitomo announcement did not harm other metals despite the recent dramatic drop in copper prices. Copper is a relatively small market compared to other metals, such as aluminum and gold. The price of the metal was above $1.25 a pound in New York in early May of 1996, but it fell to $1.04 on June 13, just before Sumitomo announced its loss. Following the announcement, copper was trading at about 89 cents (Wall). The decline in prices of copper before the Sumitomo scandal was believed to have risen from people being concerned about the number of new copper mines that were planned and the potential supply problems that it could bring about (Wall). Copper prices fell ten percent in the weeks following Hamanakas removal (Fletcher), however, prices had been falling for a while, and the scandal only exacerbated the trend (Uchitelle). The main effect of Sumitomos losses was the decline in public confidence in financial institutions. Americans wondered how well their local financial institutions were handling oversight of management. They also were concerned about a temporary decline in stock prices as well as higher interest rates for money to seek to borrow from banks (Uchitelle). The dollar is driven by peoples perception of commodity price movements, and although the dollar had weakened before news of the Sumitomo scandal, the fall in copper prices has contributed to the dollars softness (Wall). The Sumitomo affair concerned the United States about the openness of Japans financial system and the implications for interest rates. These worries as well as the copper crisis had contributed to the decline of the yen. The collapse in copper prices also hurt the Australian dollar. RISK MANAGEMENT ERRORS: In the Sumitomo copper scandal, the financial debacle originates from the failures of proper risk management. By entering into fictitious trades for over ten years and manipulating several accounts, Hamanaka successfully misled his management into believing that he was making huge profits. Hamanaka had been trading on the London Metal Exchange forward market for copper. Sumitomo was the largest participant in the physical market for copper-he handled twice the volume as his competitors. Hamanaka was known in the copper markets as Mr. Five Percent because Sumitomos copper trading team traded approximately 500,000 metric tons of copper a year, which was five percent of the total world demand for copper (Weston). In regards to risk management, whenever any hedge fund or speculator who was aware of manipulation tried to take short positions, Hamanaka invested more money into his positions, thus sustaining a higher price because he dominated the market. However, despite these illegal practices no action was taken against Hamanaka because of the profits he generated for the company (Weston). There are several reasons from a management perspective as to why the scandal carried on as long as it did. The middle office may have bypassed early warning signals perhaps because Hamanaka was perceived as an experienced senior trader. Hamanaka was chief of the trading office and intentionally had an incentive to maximize profit opportunities through illegal ways. Employees within the firm may have allowed the fraud to occur by turning the other way. This is a case of decentralization (Tschoegl). The Sumitomo scandal has provided valuable insight and enables one to appreciate and understand the importance of internal and external controls. If there had been any controls, it is believed that the scandal would have been detected much earlier and before a loss of $1.8 billion. WAS IT PREVENTABLE? IF SO, HOW? The Sumitomo Copper Crisis was, at its core, a very preventable crisis-almost embarrassingly so. The huge financial swings that the copper market saw in the late 1980s and early 1990s as a result of Hamanakas indiscretions were exactly that: the result of one mans greed and indiscretions. Hamanaka initiated and participated in the illegal trade of copper-like making off the book deals in order to recover unrealized losses-and incited a wave of regulatory laws by the London Metal Exchange and the Commodity Futures Trading Commission (CFTC). Hamanaka exploited various agents and partnerships in his ten-year long market-manipulating extravaganza. He was able to do this due to serious misgivings and loopholes in the commodity futures markets, as well as taking advantage of gaps in the chain of command and knowledge. Hamanaka maintained two different sets of trading books: one that recorded fabricated profits for the Sumitomo Corporation and another real record of all the off-the-book and under-the-table deals that were made to maintain control of the market. This long-term interference and domination of the copper market was nonetheless very hard to maintain due to one key fact: in order to corner a commodities market, the company must actually hold the assets, which presents an additional strain on resources and funds. This very requirement may be the answer to preventing scandals like this in the future (Wall). As aforementioned, the Sumitomo Copper Crisis was largely unavoidable simply because one mans poor decisions affected the rest of the affiliated market. The essence of the problem was unauthorized trading that the culprit undertook to enhance his firms profitability and then his own career and pay, Adrian Tschoegl mentioned in The Key to Risk Management. However, the true debacle is a result of a lack of internal and external controls. The Sumitomo Corporation, which was divided into essentially three separate offices (front, back and middle), simply did not harbor or even encourage communication between departments and sectors (Tschoegl). The middle office (which is responsible for one of the most key business functions: risk management) can easily be said to have failed most spectacularly in this scandal. The lack of risk awareness and management led to a loss of $1,800 million dollars and a stain on the Sumitomo name, all because of a decentralized, non-communicative corporate str ucture (Tschoegl). The most effective approach to avoiding something like this in the future is basically three-pronged: more and better management-level controls, independent transaction monitoring, and more stringent regulation (of the London Metal Exchange, by the government, and of corporations e.g. corporate social responsibility) (Tschoegl). The management-level controls should consist of a conscious effort at centralizing every part of the company, as well as maintaining strict inter-company discipline and training. Independent transaction making should be monitored so no two-book accounting systems are permissible; that is to say, that there is a system of checks and balances within the corporation to ensure above-board transactions. In terms of regulation on behalf of various agencies and governments, its only necessary to say that more of it is probably needed to avoid price manipulation. Perhaps a system of rigorous reporting and accounting policies could be implemented, which would strength en the markets effectiveness anyways. CONCLUSION: Its fair to say that the Sumitomo Copper Crisis leaves the skilled and careful trader with a few pivotal takeaways. First, both internal and external management controls are absolutely crucial to the success of any company, but if said management is left to run unchecked through the system, mishaps and misdeeds are bound to occur. Strict and standardized corporate training and discipline is the remedy to this pitfall. Second, given the right amount of determination and finesse, the market on almost any given commodity can be cornered, for better or for worse. Events like this, despite their far-reaching negative implications for the perpetrator, always help make the market a more efficient and fluid network. The lessons that are learned from scandals such as the Sumitomo Copper Affair in the long run only work to better and enhance the market.

Friday, September 20, 2019

George Orwells Nineteen Eighty-Four 1984 Essay -- essays research pa

Winston Smith is a low-ranking member of the ruling Party in London, in the nation of Oceania. Everywhere Winston goes, even his own home, the Party watches him through telescreens; everywhere he looks he sees the face of the Party's seemingly omniscient leader, a figure known only as Big Brother. The Party controls everything in Oceania, even the people's history and language. Currently, the Party is forcing the implementation of an invented language called Newspeak, which attempts to prevent political rebellion by eliminating all words related to it. Even thinking rebellious thoughts is illegal. Such thoughtcrime is, in fact, the worst of all crimes. As the novel opens, Winston feels frustrated by the oppression and rigid control of the Party, which prohibits free thought, sex, and any expression of individuality. Winston dislikes the party and has illegally purchased a diary in which to write his criminal thoughts. He has also become fixated on a powerful Party member named O'Brien, whom Winston believes is a secret member of the Brotherhood—the mysterious, legendary group that works to overthrow the Party. Winston works in the Ministry of Truth, where he alters historical records to fit the needs of the Party. He notices a coworker, a beautiful dark-haired girl, staring at him, and worries that she is an informant who will turn him in for his thoughtcrime. He is troubled by the Party's control of history: the Party claims that Oceania has always been allied with Eastasia...

Thursday, September 19, 2019

Literary Paper of The Grapes of Wrath by Steinbeck -- Grapes Wrath ess

Literary Paper of The Grapes of Wrath by Steinbeck Steinbeck wrote many wonderful books but a great classic is one titled The Grapes of Wrath. This is a story of a family called the Joads, and a tale of a courageous family who sought security and family unity. In my paper I will examine the different ways the Joads tried to keep united whether just within their immediate family or eventually with all the others who shared the same struggles and sufferings. Steinbeck's dialogue and description's of the dusty roads, the men squatting in the dirt drawing pictures while making major decisions, the way in which they traveled all puts you right into the middle of the family. One becomes aware and wants to be a part of there unity and their long for security. Steinbeck's use of the characters dialect is astoundingly excellent and unmistakenly realistic of the Joad's culture. Without this dialogue, it would not be as intense and vivid. J. Homer Caskey, in "Letters to the Editor" says, "Steinbeck's knowledge of the forces which hold a family together and the forces which cause it to disintegrate. He understands that family councils are an important part of the lives of the Joads." The major theme is the struggle and survival of the Joad family from the time they lost their home, to the unity they felt and soon were a part of a whole community, one big family, and one big soul. This theme... ...; James N. Vaughan, "The Commonweal," (July 1939) Vol. XXX, 10c No. 14 BIBLIOGRAPHY Steinbeck, John The Grapes of Wrath, New York, NY 1992 Caskey, Homer J. "The Saturday Review, Letters to the Editor," Ohio University (May 1939) Vaughan, James N. "The Commonweal," (July 1939)

Wednesday, September 18, 2019

Breast Cancer Essay -- essays research papers

Breast cancer is the most common type of cancer in women, it accounts for one of every three diagnoses in the United States. Breast cancers are malignancies, life threatening tumors that develops in one or both breasts. A female breast consists of fatty and fibrous connective tissues. The interior of the breast is divided into about twenty different sections called lobes. Each of the lobes is further divided in to lobules, which are structures that contain small milk-producing glands. These glands place the milk into tiny ducts. These ducts take the milk through out the breast and store in a chamber located below the nipple. Breast cancer can either be invasive (spreading) or noninvasive (non-spreading). An invasive cancer penetrates the wall of a duct. This type of cancer is the most common, constituting about seventy percent of all cases. Infiltrating lobular cancer that spreads through a wall of a lobule accounts for about eight percent of all breast cancer. This type is likely to appear in both of the breast, often in seven separate locations. The cause of breast cancer is unknown but researchers are suggesting that estrogen, a hormone produced by the ovaries, may be involved. Studied suggest that the longer a women is exposed to the hormone (i.e. If she starts to menstruate before the age of twelve or if she went through menopause after the age of fifty-five and/or had children after the age of thirty) are at a greater risk. Recently two breast cancer susceptibility genes have been identified. The first one is BRCA1 (a flaw in this gene is common to those who have breast cancer) and the second is BRCA2 (a defect in this gene is associated with breast cancer alone). People who have a mutated BRCA1 gene have an eighty-six percent risk of developing breast cancer by the age of seventy. Women are one hundred times more likely to get breast cancer than men. More than eighty percent of breast cancer occur in women over the age of fifty. At the age of forty her odds are one in two hundred and seventeen (217), and in women younger than thirty they account for only one and a half percent of all breast cancer cases. About five percent of all breast cancers are inherited. Those with a family history of breast cancer in a first-degree relative (i.e. mother, sister, and daughter) are two to three times the risk of the general population. Women who take hormo... ...f the nipple was removed it can be rebuilt from other body tissue and color is applied using tattoo techniques. Recurrence is always a serious event. Recurrence usually happens in two or three cases out of ten. There are three ways in which cancer can recur in your breast. The most common recurrence is in the conserved breast in the region of the original cancer. If this type of cancer hasn’t spread then it can be treated with a mastectomy. The other kind of recurrence involves the lymph nodes. If it is not considered to be a metastasis (spread to other areas) it can be treated with further surgery or radiation. A recurrence in the scar or chest wall after a mastectomy is more serious. Because all your breast tissue has been removed, it is impossible for cancer to be residual, and therefore it must have traveled from the lymphatic system or blood stream. In conclusion it is very important that women do daily/monthly breast examinations and if by your age (40 or older) or if the woman has specific risk factors then a mammogram should be done on a yearly or biannual basis. With all the advancement of medicine today, hopefully a cure for breast cancer will be in the near future.

Tuesday, September 17, 2019

A Comparative Analysis of Overstock and Amazon

Financial Reporting, Analysis and Ethics: A Comparative Analysis of Overstock. com and Amazon Robert Baird BU7545 Fall 2011 Financial Reporting, Analysis and Ethics: A Comparative Analysis of Overstock. com and Amazon Robert Baird BU7545 Fall 2011 Table of Contents| | | Executive Summary| 2| | | Company and Industry Information| 3| | | Accounting Issues| 6| | | Accounting Policies and Disclosure Practices| 9| | | Financial Statement Analysis| 10| | | Corporate Governance| 13| | | Conclusion| 15| | |References| 18| | | Appendices| 21| Executive Summary This paper covers the accounting errors related to freight costs that led Overstock. com in 2006 to restate its financial statements for 2002, 2003, 2004 and quarterly reports for 2004 and 2005, and the subsequent SEC investigation in which they were cleared of wrongdoing. It also covers a second restatement from 2009, in which the financial statements for 2009 and 2008 were restated and another SEC investigation related to those restat ements.The paper details a glaring problem for Overstock related to its accounting controls and even the company’s admittance in its annual report that it does not have an appropriate number of qualified accounting professionals able to produce financial statements that are free of material errors. Overstock is compared against a direct competitor, Amazon, who although is a much larger company that Overstock, has become the standard in the industry against which all other companies are judged.The financial statements and financial ratios from 2006-2008 of both Amazon and Overstock are shown in comparison with one another to offer some insight into the strengths and weaknesses of each company and to evaluate their performance, and include consolidated statements of operations and consolidated balance sheets from 2005-2008 and common-size statements of operations and balance sheets for each company from 2005-2008, as well as trend statements of operations and balance sheets for each company from 2005-2008.The paper also examines the corporate structure of each company, including the board of directors, the different board committees that exist and compensation practices for senior company executives. The paper concludes that Overstock must put in place the proper controls and hire competent accounting and auditing professionals to ensure the validity of their financial statements. Company and Industry Information Overstock. com (Overstock) was incorporated in Utah in December 1998, originally as D2-Discounts Direct, Inc. , later reincorporated in the state of Delaware in 2002 and changed its name to Deals. om, Inc. in 1999. Overstock adopted its present name on October 25, 1999 and is based out of Salt Lake City, Utah. Overstock is an online retailer that sells discount merchandise to consumers through its online website. According to Mergent Online, â€Å"Overstock. com is an online retailer providing discount brand name, non-brand name and closeout mer chandise, including bed-and-bath goods, home decor, kitchenware, furniture, watches and jewelry apparel, electronics and computers, sporting goods, and designer accessories, among other products† (2011).Overstock also sells â€Å"run books, magazines, compact discs, digital video disk and video games† (Mergent Online, 2011). The company conducts direct business, in which it orders are fulfilled at Overstock’s warehouses in Salt Lake City, Utah and shipped to final consumers or business, and business with fulfillment partners, which occurs when Overstock sells another manufacturers or retailers merchandise on their website and those third parties pack and ship orders. Overstock, however, does â€Å"handle returns and customer service related to substantially all orders placed through its website† (Mergent Online, 2011).According to Mergent Online, as of the end of 2010, Overstock â€Å"sells to customers in over 90 countries† but â€Å"does not have sales operations outside the United States† and â€Å"is using a United States based third party to provide logistics and fulfillment for all international orders† (2011). Overstock does ship goods to suppliers on consignment, and includes car and real estate listings, insurance quotes and an online auction service on its website. Amazon was originally incorporated in Washington in 1994 and later reincorporated in the state of Delaware in 1996. Amazon. om (Amazon), like Overstock is an online retailer that sells all sorts of different products and merchandise on its website. According to Mergent Online, the products on Amazon’s website â€Å"primarily include merchandise and content purchased for resale from vendors and those provided by party sellers, and it also manufactures and sells the Kindle e-reader† and they also provide â€Å"services such as Amazon Web Services (AWS), fulfillment, miscellaneous marketing and promotional agreements, such as onli ne advertising and co-branded credit cards. Amazon consists of two separate business segments, North America and International.North America consists of â€Å"amounts earned from retail sales of consumer products (including from sellers) and subscriptions through North America-focused websites such as www. amazon. com and www. amazon. ca and include amounts earned from AWS† and includes the export sales from the above mentioned websites (Mergent Online, 2011). The International business segment consists of â€Å"amounts earned from retail sales of consumer products (including from sellers) and subscriptions through internationally focused locations† and the segment includes â€Å"export sales from these internationally ased locations (including export sales from these sites to customers in the United States and Canada), but excludes export sales from the company’s United States and Canadian locations† (Mergent Online, 2011). According to Standard & Poorâ €™s NetAdvantage, Amazon â€Å"has virtually unlimited online shelf space, and can offer customers a vast selection of products through an efficient search and retrieval interface† (2011). In addition to being the seller of record for a broad range of new products, Amazon allows other businesses and individuals to sell new, used and collectible products on its websites through its Merchant and Amazon Marketplace programs† in which Amazon â€Å"earns fixed fees, sales commissions and/or per unit activity fees,† as well as serving developers and â€Å"enterprises of all sizes through AWS, which provides access to technology infrastructure that developers can use to virtually enable any type of business† (S&P NetAdvantage, 2011).The online retail industry is an industry that is thriving as more and more consumer purchase products online. As the supply chain and logistics processes have become increasingly advanced and streamlined, online retailing has tak en major strides in the past two decades. According to the Standard & Poor’s Industry Surveys (Computers: Consumer Services & the Internet), â€Å"United States online retail sales (excluding the auto, travel and prescription drug categories) increased 13% in 2010 to $17. billion† and â€Å"improvements in multi-channel initiatives, better online merchandising, more personalized offerings and increasingly sophisticated marketing efforts drove growth in 2010,† while S&P Capital IQ forecasts internet retail sales will rise to 11% in 2011 (2011, p. 10) . The S&P Industry Survey also states that â€Å"worldwide business-to-consumer (B2C) internet spending may increase from $708 billion in 2010 to $1. trillion in 2014† and the three most popular categories of merchandise sold online in 2009 were (in order) â€Å"apparel, accessories and footwear; software and peripherals; and consumer electronics,† and a â€Å"number of exclusive online retailers have also been successful, among (them) major publicly traded online retailers like Amazon. com Inc. and Overstock. com Inc. † (2011, p. 17). Amazon, however, is far and away the leader of its industry. At first it seemed like a business model that was destined to ail, but is has since become â€Å"the model† for its industry and â€Å"has been the breakaway leader in global e-commerce for a number of years† (S&P Industry Surveys, 2011, p. 18). Overstock is trying to emulate the strategy used by Amazon, but it is difficult for any online retailer to differentiate itself from a company like Amazon, with its huge market share and market capitalization. Amazon is an incredibly tough act to follow and according to the S&P Industry Survey, it is predicted that in 2011, Amazon â€Å"will achieve its sixth straight year with revenue growth of greater than 25%† (2011, p. 18).Amazon has â€Å"achieved strong and sustained success by continuing to focus on its customers † and â€Å"has looked to innovate and take risks, despite potential near-term negative impacts to its financial performance† (S&P Industry Surveys, 2011, p. 18). Accounting Issues Overstock has had numerous instances of accounting and control errors that have resulted in restatements of financial statements and probes by the United States Securities and Exchange Commission (SEC). In 2006, Overstock announced that it would restate its previously reported financial statements going back to 2002 due to an error in the way it accounted for its freight costs.According to the Deseret News on March 1, 2006, â€Å"the accounting errors relate to how the Salt Lake-based company immediately expensed inbound freight costs in the periods they were incurred, instead of capitalizing such costs as part of inventory and expensing them as it sold off the inventory† and the error â€Å"effects annual financial reports for 2002, 2003, 2004 and quarterly reports for 2004 and 2005à ¢â‚¬  (2006, p. E1). The correction of the freight cost error actually increased the inventory by $3. million as of the third quarter of 2005, and lowered the net losses for fiscal years 2002, 2003 and 2004. In an interview on CNBC in 2006, Overstock CEO said of the restatement â€Å"our restatement was $3. 5 million to the good† and â€Å"our auditors have said that we understated our results by $3. 5 million† (CEO Wire, 2006). He went on to say in the interview with Becky Quick on CNBC that â€Å"it turns out we had – turns out that we have understated our performance, that our books are too conservative, is what the auditors have said† (CEO Wire, 2006).Overstock vice president of corporate affairs, echoed this sentiment in an interview with the Knight Ridder Tribune Business News, saying â€Å"when you look at what this restatement is really, it is positive† (Sims, 2006, p. 1). In an interview with the Salt Lake Tribune, Overstock President Jon athan Johnson said of the accounting errors: â€Å"When we order comforters, we pay the manufacturer and the freight bill. We’ve been accounting for the freight bill as we paid it, expensing it. We should have been capitalizing the freight bill as we sold the goods, as opposed to when we actually paid it† (Keahey, 2009).These are just some examples from the corporate officers at Overstock that they just clearly do not get it, and do not understand the impact of a financial restatement. The Deseret News describes the effects of the accounting error as follows, â€Å"for 2005, the accounting change will narrow the reported net loss by $1. 8 million for the quarter ended September 30 and by $592,000 for the quarter ended June 30† and â€Å"widen the net loss by $107,000 for the quarter ended March 31. For 2004, the correction will lower the full-year loss by $461,000.The accounting change will also reduce the net losses for the 2002 and 2003 fiscal years† (2 006, p. E1). This restatement led to an investigation of Overstock by the SEC resulting in a subpoena from the SEC for internal documents relating to â€Å"its accounting policies, targets and projections† (Wall Street Journal, 2006). On June 6, 2008 the SEC informed Overstock that it had completed its investigation â€Å"of the company and its officers and does not intend to recommend any enforcement action† (Financial Wire, 2008).Overstock apparently did not learn much from the above mentioned restatement and subsequent SEC investigation, and on September 15, 2009, Overstock received yet another notice from the SEC, putting the company on notice that the SEC was â€Å"conducting an investigation concerning Overstock’s previously-announced restatements of its financial statements in 2006 and 2008 and other matters† and the subpoena that accompanied the notice â€Å"covers documents related to the restatements and also to Overstock’s billings to i ts partners in the fourth quarter of 2008 and related collections, and Overstock’s accounting for and implementation of software relating to its accounting for customer refunds and credit, including offsets to partners, and related matters† (PR Newswire, 2009). In February 2010, Overstock announced it was restating its financial statements for 2008 and 2009, shifting $1. 8 million of income from 2009 to 2008. Overstock attributed this restatement to â€Å"some accounting confusion involving other companies that sell goods on its website† and a related problem involving incorrect invoices from a freight vendor† (Deseret News, 2010, p. A10).Overstock also stated in a filing with the SEC that it was â€Å"applying different accounting standards for its stock option plans that will mean decreased income of $350,000 for 2008 and about $900,000 for 2009† (Harvey, 2010). As if the restatement of financial reports was not bad enough, Overstock admitted to a â€Å"deficiency in its financial controls related to its relationship with certain business partners† and informed the SEC that â€Å"management’s report on internal control over financial reporting for fiscal 2008 can no longer be relied upon† (Harvey, 2010). On his blog on Phil’s Stock World, Sam Antar (who discloses that he is a convicted felon and former CPA who now works closely with government and law enforcement agencies in cases of white-collar crimes and regularly refers cases to them) wrote that â€Å"in 2009†¦Overstock. om violated GAAP in accounting for its recoveries of certain offsetting costs and reimbursements amounts due to the company from its fulfillment partners (suppliers) who were under-billed in previous reporting periods† and that Overstock should have â€Å"restated its financial reports to recognize income when those offsetting costs and reimbursements were actually earned by the company in those previous reporting periods† (Phil’s Stock World, 2010). Antar claims that accounting errors are bordering on criminal and that the company â€Å"improperly recognized income as those amounts were collected in future accounting periods on a non-GAAP cash basis† and that Overstock even reported profits in the fourth quarter of 2008 when they should have reported a loss under GAAP (Phil’s Stock World, 2010).Antar made some even stronger claims against Overstock, saying that accounting errors have become commonplace at Overstock at that the officers of the company do not seemed interested or inclined to put the proper controls in place to detect these errors. Antar writes that â€Å"so far, from 1999 to Q3 2009 every single financial report issued by Overstock. com had to be restated at least once, sometimes twice or even three times to correct material accounting errors† with the company even claiming that the last two restatements were caused by â€Å"technology proble ms† (Phil’s Stock World, 2010). In the 2009 10-K issued by Overstock it stated that Overstock’s â€Å"information technology program change and program development controls were inadequately designed to prevent changes in our accounting systems which led to the failure to appropriately capture and accurately process data† (2010, p. 18).The two previously mentioned instances of financial report restatements mean that in 2006, the annual financial statements for 2002, 2003 and 2004 were restated; then the 2006 financial statements were restated again along with the statements for 2008. Both restatements had little or no effect on the stock price of the company and after each restatement was announced the stock price either fall modestly or even went up slightly. Accounting Policies and Disclosure Practices As shown in the numerous instances of accounting errors and restatements, Overstock clearly has an issue with its internal controls over financial reporti ng to detect basic GAAP errors before their financial statement are released to the SEC.In its 2010 10-K, Overstock acknowledges that they have a problem and states, â€Å"we lacked a sufficient number of accounting professionals with the necessary knowledge, experience and training to adequately account for and perform adequate supervisory reviews of significant transactions that resulted in misapplications of GAAP† (2010, p. 22). This is a fascinating admittance by a major publicly traded company that it simply does not have accountants to properly produce correct financial statements free of significant accounting errors. Amazon, for its part, is the leader in online retailing and a much larger company with a global footprint that outstretches most companies, and especially that of Overstock, yet their accounting policies are sound.There exists nothing in their annual reports to the SEC that outlines anything of the sort that Overstock has admitted related to not having a sufficient number of accountants. The information listed in their financial reports seems to be standard language related to GAAP. Both companies, Amazon and Overstock account for their inventory using the first-in, first-out (FIFO) method, valued at lower of cost or market value and depreciate their fixed assets on a straight-line basis. Financial Statement Analysis In its 2009 10-K report, Amazon gives an interesting overview to its business. It states that its’ â€Å"primary source of revenue is the sale of a wide range of products and services to customers† and that their â€Å"financial focus is on long-term, sustainable growth in free cash flow per share† (2009, p. 21).It also states that â€Å"we seek to reduce our variable costs per unit and work to leverage our fixed costs† and â€Å"because of our model we are able to turn over inventory quicker and have a cash-generating operating cycle† (2009, p. 22). Amazon’s inventory turnover, as shown in the financial ratios in the appendix, was 11. 46 times in 2008 (consistent with 11. 06 times in 2007 and 11. 44 times in 2006) and with a receivables turnover of 24. 95 times in 2008 and payables turnover of 5. 98 times in 2008, they have a sufficient operating cycle and cash conversion cycle. Overstock’s inventory turnover was 31. 68 times in 2008, up from 12. 21 times in 2006, and means their sales are stronger and they are moving inventory at a much better rate. The receivables turnover for Overstock 75. 49 times in 2008 and accounts payable turnover of 12. 53 times in 2008.Amazon gets more bang for their buck than Overstock, and is able to leverage their considerable size and operational capacity to achieve significant returns on their assets, equity and income. In 2008, Amazon’s return on assets (ROA) was 8. 69 percent, compared with Overstock’s -6. 23 percent ROA. Overstock’s ROA has improved from 2006 when it was -34. 43 percent but be cause of consistent net losses their return ratios are negative. Overstock’s return on equity (ROE) was -105. 88 percent, and improvement from -131. 38 percent in 2006, but nothing compared to Amazon’s ROE of 33. 25 percent in 2008. Amazon also has a significant return on operating income (ROI) of 28. 93 percent in 2008, as contrasted with Overstock’s ROI of -12. 82 percent in 2008 (up from -57. 89 percent in 2006).A look at the common-size consolidated statement of operations of Amazon and Overstock (restated) offers some insights into the considerable differences between a company with the size and stature of Amazon and a company that would like to achieve that status, like Overstock. Amazon had a gross profit in 2008 of 22. 3 percent of sales (consistent to the gross profit for 2005 through 2007), whereas Overstock had a gross profit of 17. 1 percent of revenue (consistent with gross profit percentages from 2005 through 2007). Both Amazon and Overstock had si milar total operating expenses, 17. 9 percent of sales for Amazon in 2008 and 18. 4 percent of revenue for Overstock in 2008. The numbers that are the most telling are the income statistics, with Amazon having a net income as a percentage of sales of 3. 4 percent in 2008, whereas Overstock had a net loss s a percentage of revenue of -1. 5 percent, which improved significantly from 2006 when it was -13. 7 percent and 2007 when it was -6. 3 percent. The trend consolidate statements of operations for Amazon and Overstock (restated), in which the base year of 2005 equals 100 percent, the discrepancies between a global leader in its industry, Amazon, and its competitor, Overstock, are even more compelling. Net sales for Amazon more than doubled from 2005 to 2008, and in 2008 net sales were 225. 7 percent of the net sales from 2005. Total revenue for Overstock was only up slightly from 2005 to 2008, and in 2008 total revenues were 104. 4 percent of the total revenues from 2005.Amazon also doubled its gross profit from 2005 in, up 209. 4 percent, whereas Overstock’s gross profit in 2008 was 122. 3 percent of its’ 2005 gross profit. Overstock’s total operating expenses stayed relatively close to their 2005 level in 2006, 2007 and 2008, only rising slightly. Amazon, on the other hand had a significant increase in total operating expenses. Operating expenses in 2008 were 213. 3 percent of the 2005 total operating expenses. Net income for Amazon for 2008 was 179. 7 percent of its 2005 net income and increased from 132. 6 in 2007 and from a very off year in 2006, when net income was 52. 9 percent of the previous year 2005.Overstock has lowered its net losses, and in 2008 the net loss was half (50. 8 percent) of the 2005 level, and they too had a rough year in 2006 when the net loss was four times (428. 5 percent) that of 2005. Analysis of the restated common-size consolidate balance sheet for Overstock and the common-size consolidate balance sheet for Amazon show that both companies have a similar number of current assets, as would be expected from two companies that sell products online and have significant sales and inventory turnover, but Overstock has more cash and cash equivalents when compared to Amazon. Overstock had, as a percentage of total assets, 58. 3 percent of cash and cash equivalents, up drastically from 17. percent in 2005, while Amazon had cash and cash equivalents of one-third (33. 3 percent) of total sales, up slightly from 27. 4 percent in 2005. Amazon’s total current assets were 74 percent of total assets, whereas Overstock had total current assets that totaled 84. 7 percent of total assets, which increased from 72. 1 percent of total assets in 2005. Since current assets were a large percentage of total assets, the reverse would be expected, and total current liabilities for an online retailer would also be a significant portion of total liabilities and stockholders’ equity. Most consumers mak e purchases online using credit cards and those purchases are often paid off within a year, making them current.Total current liabilities for Amazon in 2008 were 57 percent of total assets, remaining stable year over year between 2008 and 2005, while total current liabilities for Overstock were 61. 6 percent of total assets, up from 47. 5 percent in 2005. Corporate Governance Overstock has a board of directors that is comprised of four members, three of whom are independent, and is chaired by the CEO Patrick Byrne. According to the proxy statement (DEF 14A) filed on April 2, 2009, the board of directors held ten meeting during 2008 and each director attended at least 75 percent of the meetings of the board (2009, p. 14). Overstock has an audit committee and compensation committee, but no standing nominations committee.According to the proxy statement, the audit committee held 11 meetings during 2008 and the compensation committee held six meetings, and like board meetings each direc tor attended at least 75 percent of the committee meetings on which he or she served in 2008 (2009, p. 14). The audit committee is chaired by Allison Abraham and includes two financial experts, as defined by the SEC. The audit committee is responsible for â€Å"reviewing and monitoring our financial statements and internal accounting procedures, selecting, reviewing and monitoring our independent registered public accounting firm, evaluating the scope of the annual audit, reviewing audit results and consulting with management and our independent registered public accounting firm prior to presentation of financial statements to stockholders† (2009, p. 15).The compensation committee is responsible for â€Å"determining salaries, incentives and other forms of compensation for our directors, officers and other employees and administering various incentive compensation and benefit plans† (2009, p. 15). The 208 proxy statement says the compensation objectives are to â€Å"s eek to attract and retain highly competent executive management who will build long-term economic value for the Company† and that â€Å"our compensation philosophy is that the executive salary and bonus levels should be modest in comparison to those paid at comparable companies, and that executives’ opportunities for more significant compensation should be tied closely to the Company’s performance (2009, p. 20).The elements of total compensation, as laid out by the 2009 proxy statement include â€Å"base salary, annual individual cash bonuses, payments under our Performance Share Plan, awards under our 2005 Equity Incentive Plan, matching contributions under our 401 (k) plan and benefits under our health and welfare benefits plans† (2009, p. 20-21). The board of directors for Amazon consists of nine members, eight of whom are independent, and is chaired by the CEO of Amazon, Jeffrey Bezos. The 2009 proxy statement reads that the board is responsible for à ¢â‚¬Å"the control and direction of the Company† and â€Å"represents the Company’s shareholders and its primary purpose is to build long-term shareholder value† (2009, p. 8). In 2008, the board of directors met nine times and that all directors attended at least 75 percent of the â€Å"aggregate of the meetings of the board and committees occurring while they were members† (2009, p. 9).Amazon has an audit committee, leadership development and compensation committee and a nominating and corporate governance committee. The audit committee is chaired by Tom Alberg, who meets the requirement of a financial expert as defined by the SEC. According to the 2009 proxy statement, the audit committee â€Å"represents and assists the board in fulfilling its oversight responsibility relating to the Company’s financial statements and reporting process, the qualifications, independence and performance of the Company’s independent registered public accounti ng firm, the performance of the Company’s internal audit function and the Company’s compliance with legal and regulatory requirements† (2009, p. 9).The leadership development and compensation committee, as stated in the 2009 proxy statement, â€Å"evaluates the Company’s programs and practices relating to leadership development, reviews and establishes compensation of the Company’s executive officers, and administers the Company’s stock-based and certain other compensation plans, all with a view toward maximizing long-term shareholder value† (2009, p. 10). The proxy statement for 2009, also lays out the responsibilities of the nominating and corporate governance committee, and says it â€Å"reviews and assesses the composition of the board, assists in identifying potential new candidates for director, recommends candidates for election as director and provides a leadership role with respect to corporate governance of the Company† (2009, p. 10).According to the 2009 proxy statement, Amazon’s executive compensation approach is â€Å"to tie total compensation to long-term shareholder value, as reflected primarily in the Company’s stock price† and therefore the â€Å"primary component of a named executive officer’s total compensation is stock-based compensation† (2009, p. 17). In addition to stock-based compensation, executives also receive a base salary, new-hire cash bonuses and other compensation and benefits, including vacation, medical, 401 (k) and relocation benefits. Conclusion When it comes to online retailing, Amazon is far and away the leader of the industry and the model for all companies to follow. Amazon has an enormous share of the market and their market capitalization is tremendous. Their financial ratios are sound and their year over year statistics are rather impressive. Overstock, on the other hand, is a company that leaves a lot to be desired.They have had numerous restatements of their financial reports, and two instances of these restatements have been covered in detail above. Overstock has yet to have a positive net income and has had net losses every year. Due to the sheer amount of restatements that have occurred, many executives have fired or resigned their positions and taken the fall for their accounting errors and subsequent SEC investigations. Overstock seems to need to branch out into different revenue streams, such as car and real estate listings, insurance quotes and travel services in order to differentiate themselves from Amazon and capture some market share back from the titan of the industry.Amazon has its eyes on bigger targets, and wants to stand toe to toe with another gigantic company, Apple. Amazon’s manufacturing and subsequent sales of the various incarnations of the Kindle and an online music service are bold ideas that have paid off handsomely for the company, as have their investments in supply chain and shipping processes, as well as third party relationships. Overstock, for its part, would most likely just like a piece of Amazon’s market share and still has a long way to go before it is anywhere near the level of an Amazon. Overstock first needs to get its accounting controls in order and make sure that the financial statements they release in their annual reports to the SEC will not be restated in the future.The audit committee, auditors, CFO and accountants need to work together to ensure that their work is free from error, and there clearly needs to be a change in the corporate culture at Overstock because change needs to come from the top. These accounting errors should have been caught before the statements were released and given their history of investigations by the SEC, Overstock should have made every effort to clean up its act and bring in competent accounting and auditing professionals that would have the requisite attention to detail required in producing mistake free financial reports. If Overstock has any hope of ever reaching the level of an Amazon, it needs to fix its accounting issues and to install investor confidence in the company.Outside of their ROA, ROE, and ROI ratios, which are negative due to their net losses, Overstock’s financial ratios stack up nicely against the financial ratios of Amazon, which are a good sign for the company moving forward, if they can right the ship. The fact that Overstock is still around today has to be a good sign for the company, in that is has come through adversity and still remains a going concern. References Amazon, Inc. (2009). 2008 Annual Report. Seattle, WA: Amazon, Inc. , 2009. Amazon, Inc. (2008). 2007 Annual Report. Seattle, WA: Amazon, Inc. , 2008. Amazon, Inc. (2007). 2006 Annual Report. Seattle, WA: Amazon, Inc. , 2007. Amazon, Inc. (2006). 2005 Annual Report. Seattle, WA: Amazon, Inc. , 2006. Amazon, Inc. (2009) Definitive Proxy Statements.Seattle, WA: Amazon, Inc. 2009. Amazon, Inc. (2008) Definitive Proxy Statements. Seattle, WA: Amazon, Inc. 2008. Antar, S. (2010, October 16). Does Overstock. com CEO Patrick Byrne know when to shut up, especially while the SEC investigates his company? Retrieved October 30, 2011, from Phil’s Stock World Web site: http:// www. philstockworld. com Boyd, R. (2007, May 11). Company Byrne-d on probe report. New York Post, pp39. Cheng, A. (2006, May 11). Overstock cancels its share sale after SEC subpoena. Deseret News, pp. E4. Harvey, T. (2010, February 5). Overstock hit by another restatement. The Salt Lake Tribune. Hendrick, D. (2009, November 18).Online retailer fires auditor over accounting fight. SNL Kagan Media & Communications Report. Kanaracus, C. (2008, November 3). Overstock’s ERP woes force it to restate results. Computerworld, 42(44), pp. 7. Keahey, J. (2009, September 23). Overstock CEO and his critics differ over SEC probe. The Salt Lake Tribune. Kessler, S. (2011, October 13). Industry sur veys computers: consumer services & the internet. Standard & Poor’s. Mergent, Inc. (2011). Mergent Online. Mims, B. (2006, March 1). Overstock to restate earnings. Knight Ridder Tribune Business News, pp. 1. Moving the market: Overstock. com corrects results back to 2002; losses are narrowed. (2006, March 1).Wall Street Journal (Eastern Edition), pp. 1. Overstock. com, Inc. (2009) 2008 Amended Annual Report. Salt Lake City, Utah: Overstock. com, Inc. , 2009. Overstock. com, Inc. (2008) 2007 Amended Annual Report. Salt Lake City, Utah: Overstock. com, Inc. , 2008. Overstock. com, Inc. (2007) 2006 Amended Annual Report. Salt Lake City, Utah: Overstock. com, Inc. , 2007. Overstock. com, Inc. (2006) 2005 Amended Annual Report. Salt Lake City, Utah: Overstock. com, Inc. , 2006. Overstock. com, Inc. (2009) 2008 Annual Report. Salt Lake City, Utah: Overstock. com, Inc. , 2009. Overstock. com, Inc. (2008) 2007 Annual Report. Salt Lake City, Utah: Overstock. com, Inc. , 2008.Overstock . com, Inc. (2007) 2006 Annual Report. Salt Lake City, Utah: Overstock. com, Inc. , 2007. Overstock. com, Inc. (2006) 2005 Annual Report. Salt Lake City, Utah: Overstock. com, Inc. , 2006. Overstock. com announces receipt of another SEC subpoena. (2009, September 17). PR Newswire. Overstock. com – President interview. (2006, March 1). CEO Wire. Overstock corrects its financial results. (2006, March 1). Deseret News, pp. E1. Overstock. com, Inc. (2009). Definitive proxy statement. Salt Lake City, Utah: Overstock. com, Inc. , 2009. Overstock. com, Inc. (2008). Definitive proxy statement. Salt Lake City, Utah: Overstock. com, Inc. , 2008.Overstock gets SEC subpoena. (2006, May 10). Wall Street Journal (Eastern Edition). Overstock. com shifting income. (2010, February 6). Deseret News, pp. A10. Q3 2008 Overstock Com Inc earnings conference call – final. (2008, October 24). Fair Disclosure Wire. SEC closes Overstock. com probe, will take no action. (2008, June 7). Financial Wire. Standard & Poor’s. (2011) Standard & Poor’s NetAdvantage. Taub, S. (2006, February 28). Freight costs spur Overstock restatement. CFO. com, pp. 1. Appendices Overstock Original Consolidated Statements of Operations (in thousands)| | | | Year Ended December 31,| | 2008| 2007| 2006| 2005| Revenue| | | | |Direct Revenue| 174,203| 195,622| 303,202| 324,875| Fulfillment partner revenue| 660,164| 564,539| 484,948| 478,947| Total Revenue| 834,367| 760,161| 788,150| 803,822| | | | | | Cost of goods sold:| | | | | Direct| 154,501| 164,368| 284,943| 283,377| Fulfillment partner| 536,957| 468,222| 408,407| 400,889| Total cost of goods sold| 691,458| 632,590| 693,350| 683,266| Gross profit| 142,909| 127,571| 94,800| 120,556| | | | | | Operating expenses:| | | | | Sales and Marketing| 57,634| 55,458| 70,897| 79,651| Technology| 57,815| 59,453| 65,158| 28,132| General and administrative| 38,373| 41,976| 46,837| 36,495| Restructuring| —| 12,283| 5,674| —|Amortiza tion of stock-based compensation| —| —| —| 72| Total operating expenses| 153,822| 169,170| 188,566| 144,350| | | | | | Operating loss| (10,913)| (41,599)| (93,766)| (23,794)| Interest income, net| 3,163| 4,788| 3,566| (270)| Interest expense| (3,462)| (4,188)| (4,765)| (5,582)| Other income (expense), net| (1,446)| (92)| 81| 4,728| | | | | | Loss from continuing operations| (12,658)| (41,091)| (94,884)| —| Loss from discontinued operations| —| (3,924)| (6,882)| —| | | | | | Net loss| (12,658)| (45,015)| (101,856)| (24,918)| | | | Overstock Restated Consolidated Statements of Operations (in thousands)| | | | For Year Ended December 31,| | 2008| 2007| 2006| 2005| Revenue| | | | | Direct Revenue| 174,203| 197,088| 301,509| 324,875|Fulfillment partner revenue| 660,164| 568,814| 478,628| 474,441| Total Revenue| 834,367| 765,902| 780,137| 799,316| | | | | | Cost of goods sold| | | | | Direct| 154,501| 168,008| 284,774| 282,383| Fulfillment partner | 536,957| 473,344| 405,559| 400,057| Total cost of goods sold| 691,458| 641,352| 690,333| 682,440| Gross profit| 142,909| 124,550| 89,804| 116,876| | | | | | Operating expenses:| | | | | Sales and Marketing| 57,634| 57,815| 38,373| 77,155| Technology| 57,815| 59,453| 70,897| 27,901| General and administrative| 38,373| 41,976| 46,837| 33,043| Restructuring| —| 12,283| 5,674| —| Amortization of stock-based compensation| —| —| —| —| Total operating expenses| 153,822| 169,170| 188,566| 138,099| | | | | |Operating loss| (10,913)| (44,620)| (98,762)| (21,223)| Interest income, net| 3,163| 4,788| 3,566| (270)| Interest expense| (3,462)| (4,188)| (4,765)| (5,582)| Other income (expense), net| (1,446)| (92)| 81| 4,728| | | | | | Loss from continuing operations| (12,658)| (44,112)| (99,880)| (22,347)| Loss from discontinued operations| —| (3,924)| (6,882)| (2,571)| | | | | | Net loss| (12,658)| (48,036)| (106,762)| (24,918)| Overstock Common-S ize Consolidated Statements of Operations| | | | | | | Year Ended December, 31| (% of revenue)| 2008| 2007| 2006| 2005| Total Revenue| 100%| 100%| 100%| 100%| Total cost of goods sold| 82. 9%| 83. 2%| 88%| 85%| Gross profit| 17. 1%| 16. 7%| 12%| 15%| Operating expenses:| | | | |Sales and Marketing| 6. 9%| 7. 3%| 9%| 9. 9%| Technology| 6. 9%| 7. 8%| 8. 3%| 3. 5%| General and administrative| 4. 6%| 5. 5%| 6%| 4. 5%| Restructuring| —| 1. 6%| . 7%| —| Amortization of stock-based compensation| —| —| —| . 009%| Total operating expenses| 18. 4%| 22. 3%| 23. 9%| 18%| | | | | | Operating loss| -1. 3%| -5. 5%| -11. 9%| -3%| Interest income, net| . 3%| . 6%| . 5%| -. 03%| Interest expense| -. 4%| -. 6%| -. 6%| -. 7%| Other income (expense), net| -. 1%| -. 01%| . 01%| . 6%| | | | | | Loss from continuing operations| -1. 5%| -5. 4%| -12%| —| Loss from discontinued operations| —| -. 5%| -. 9%| —| | | | | | Net loss| -1. %| -5. 9%| -12. 9%| - 3. 1%| | | | | | Overstock Trend Consolidated Statements of Operations (2005= 100%)| | | | | | | For Year Ended December 31,| | 2008| 2007| 2006| 2005| Total Revenue| 103. 8%| 94. 6%| 98. 1%| 100%| Total cost of goods sold| 101. 2%| 92. 6%| 101. 5%| 100%| Gross profit| 118. 5%| 105. 8%| 78. 7%| 100%| Operating expenses:| | | | | Sales and Marketing| 72. 4%| 69. 7%| 89%| 100%| Technology| 205. 6%| 211. 3%| 231. 6%| 100%| General and administrative| 105. 1%| 115%| 128. 3%| 100%| Total operating expenses| 106. 6%| 117. 2%| 130. 6%| 100%| | | | | | Operating loss| 45. 9%| 174. 8%| 394. 1%| 100%| Interest expense| 62%| 75%| 85. %| 100%| | | | | | Loss from continuing operations| 13. 3%| 43. 3%| 100%| —| Loss from discontinued operations| —| 57%| 100%| —| | | | | | Net loss| 50. 8%| 180. 7%| 408. 8%| 100%| Overstock Restated Common-Size Consolidated Statements of Operations| | | | | | | For Year Ended December 31,| (% of revenue)| 2008| 2007| 2006| 2005| Total Revenue | 100%| 100%| 100%| 100%| Total cost of goods sold| 82. 9%| 83. 7%| 88. 5%| 85. 4%| Gross profit| 17. 1%| 16. 3%| 11. 5%| 14. 6%| Operating expenses:| | | | | Sales and Marketing| 6. 9%| 7. 5%| 4. 9%| 9. 7%| Technology| 6. 9%| 7. 8%| 9. 1%| 3. 5%| General and administrative| 4. 6%| 5. 5%| 6%| 4. 1%|Restructuring| —| 1. 6%| . 7%| —| Amortization of stock-based compensation| —| —| —| —-| Total operating expenses| 18. 4%| 22. 1%| 24. 2%| 17. 3%| | | | | | Operating loss| -1. 3%| -5. 8%| -12. 7%| -2. 7%| Interest income, net| . 4%| . 6%| . 5%| -. 03%| Interest expense| -. 4%| . 5%| -. 6%| -. 7%| Other income (expense), net| -. 2%| . 01%| . 01%| . 6%| | | | | | Loss from continuing operations| -1. 5%| -5. 8%| -12. 8%| -2. 8%| Loss from discontinued operations| —| -. 5%| -. 9%| -. 3%| | | | | | Net loss| -1. 5%| -6. 3%| -13. 7%| -3. 1%| | | | | | Overstock Trend Restated Consolidated Statements of Operations (2005= 100%)| | | | | | For Year Ended December 31,| | 2008| 2007| 2006| 2005| Total Revenue| 104. 4%| 95. 8%| 97. 6%| 100%| Total cost of goods sold| 101. 3%| 94%| 101. 2%| 100%| Gross profit| 122. 3%| 106. 6%| 76. 8%| 100%| Operating expenses:| | | | | Sales and Marketing| 74. 7%| 75%| 50%| 100%| Technology| 207. 2%| 213. 1%| 254. 1%| 100%| General and administrative| 116. 1%| 127%| 141. 7%| 100%| Total operating expenses| 111. 3%| 122. 5%| 136. 5%| 100%| | | | | | Operating loss| 51. 4%| 210. 2%| 465. 4%| 100%| Interest expense| 62%| 75%| 85. 4%| 100%| | | | | | Loss from continuing operations| 56. 6%| 197. 4%| 447%| 100%| Loss from discontinued operations| —| 152. 6%| 267. %| 100%| | | | | | Net loss| 50. 8%| 192. 9%| 428. 5%| 100%| Overstock Original Consolidated Balance Sheets (in thousands)| | | | December 31,| | 2008| 2007| 2006| 2005| | Assets| Current Assets:| | | | | Cash and cash equivalents| 100,577| 101,394| 126,965| 56,224| Marketable securities| 8,959| 46,000| —| 55,799| Cash, cash eq uivalents and marketable securities| 109,566| 147,394| 126,965| 112,023| Accounts receivable, net| 6,985| 12,304| 11,638| 11,695| Notes receivable| 1,250| 1,506| 6,702| —| Inventories, net| 17,723| 25,933| 20,274| 93,269| Prepaid inventory, net| 761| 3,572| 2,241| 9,633| Prepaid expense| 9,694| 7,572| 7,473| 8,508|Current assets of held for sale subsidiary| | | 4,718| | Total current assets| 145,975| 198,281| 180,011| 235,128| Restricted cash| —| —| —| 253| Fixed assets, net| 23,142| 27,197| 56,198| 61,914| Goodwill| 2,784| 2,784| 2,784| 13,169| Other long-term assets, net| 538| 86| 578| 15,449| Notes receivable| —| 4,181| —| —| Long-term assets of held for sale subsidiary| | | 16,594| | Total assets| 172,441| 235,529| 265,165| 325,913| | | | | | Liabilities and Stockholders’ Equity (Deficit)| Current liabilities:| | | | | Accounts payable| 62,120| 70,648| 66,039| 101,436| Accrued liabilities| 25,154| 52,598| 40,142| 46,847| De ferred Revenue| 19,026| —| —| —| Capital lease obligations| —| 3,796| 5,074| 6,683|Current liabilities of held for sale subsidiary| | | 3,684| | Total current liabilities| 106,300| 127,042| 114,939| 154,966| Other long-term liabilities| 2,572| 3,034| —| —| Capital lease obligations, non-current| —-| —-| 3,983| 3,058| Convertible senior notes| 66,558| 75,623| 75,279| 74,935| Total liabilities| 175,430| 205,699| 194,201| 232,959| | | | | | Stockholders’ equity (deficit):| | | | | Preferred stock| —| —| —| —| Common stock| 2| 2| 2| 2| Additional paid in capital| 338,620| 333,909| 325,771| 251,244| Accumulated deficit| (264,985)| (243,709)| (198,694)| (96,829)| Unearned stock-based compensation| | | | (305)|Treasury stock| (76,670)| (63,278)| (64,983)| (65,325)| Accumulated other comprehensive income (loss)| 48| (94)| (132)| 962| Total stockholders’ equity (deficit)| (2,985)| 26,830| 61,964 | 89,749| Total liabilities and stockholders’ equity (deficit)| 172,445| 232,529| 265,165| 325,913| | | | | | Overstock Restated Consolidated Balance Sheets (in thousands)| | | | December 31,| | 2008| 2007| 2006| 2005| | Assets| Current Assets:| | | | | Cash and cash equivalents| 100,577| 101,394| 126,965| 55,875| Marketable securities| 8,989| 46,000| —| 55,799| Cash, cash equivalents and marketable securities| 109,566| 147,394| 126,965| 111,674| Accounts receivable, net| 6,985| 11,208| 16,330| 10,021| Notes receivable| 1,250| 1,506| 6,702| —|Inventories, net| 17,723| 25,643| 23,970| 93,269| Prepaid inventory, net| 761| 3,572| 2,241| 9,633| Prepaid expense| 9,694| 7,572| 7,473| 8,477| Current assets of held for sale subsidiary| | | 4,718| 2,054| Total current assets| 145,979| 196,895| 188,299| 235,128| Restricted cash| | | | 253| Fixed assets, net| 23,144| 27,197| 56,198| 60,850| Goodwill| 2,784| 2,784| 2,784| 2,784| Other long-term assets, net| 538| 86| 578| 3, 333| Notes receivable| —| 4,181| —| —| Long-term assets of held for sale subsidiary| | | 16,594| 23,565| Total assets| 172,445| 231,143| 264,453| 325,913| | | | | | Liabilities and Stockholders’ Equity (Deficit)| Current liabilities:| | | | |Accounts payable| 62,120| 70,358| 58,412| 100,188| Accrued liabilities| 25,154| 37,155| 38,434| 45,934| Deferred Revenue| 19,026| 22,965| 23,220| 6,683| Capital lease obligations| —| 3,796| 5,074| —| Current liabilities of held for sale subsidiary| | | 3,684| 2,161| Total current liabilities| 106,300| 134,274| 128,824| 154,966| Other long-term liabilities| 2,572| 3,034| —| —| Capital lease obligations, non-current| —| —| 3,983| 3,058| Convertible senior notes| 66,558| 75,623| 75,279| 74,935| Total liabilities| 175,430| 212,931| 208,086| 232,959| | | | | | Stockholders’ equity (deficit):| | | | | Preferred stock| —| —| —| —| Common stock| 2| 2 | 2| 2|Additional paid in capital| 338,620| 333,909| 325,771| 250,939| Accumulated deficit| (264,985)| (252,327)| (204,291)| (96,829)| Treasury stock| (76,670)| (63,278)| (64,983)| (65,325)| Accumulated other comprehensive income (loss)| 48| (94)| (132)| 962| Total stockholders’ equity (deficit)| (2,985)| 18,212| 56,367| 89,749| Total liabilities and stockholders’ equity (deficit)| 172,445| 231,143| 264,453| 325,913| Overstock Restated Common-Size Consolidated Balance Sheets| | | | | | | December 31,| (% of total assets)| 2008| 2007| 2006| 2005| Assets| | | | | Current Assets:| | | | | Cash and cash equivalents| 58. 3%| 43. 9%| 48%| 17. 1%| Marketable securities| 5. 2%| 19. 9%| —| 17. 1%| Cash, cash equivalents and marketable securities| 63. 5%| 63. 8%| 48%| 34. 2%| Accounts receivable, net| 4. 1%| . 5%| 6. %| 3. 1%| Notes receivable| . 7%| . 7%| 2. 5%| —| Inventories, net| 10. 3%| 11. 1%| 9. 1%| 28. 6%| Prepaid inventory, net| . 4%| 1. 5%| . 8%| 3%| Prep aid expense| 5. 6%| 3. 3%| 2. 8%| 2. 6%| Current assets of held for sale subsidiary| | | 1. 8%| . 6%| Total current assets| 84. 7%| 85. 2%| 71. 2%| 72. 1%| Restricted cash| | | | . 07%| Fixed assets, net| 13. 4%| 11. 8%| 21. 3%| 18. 7%| Goodwill| 1. 6%| 1. 2%| 1. 1%| . 9%| Other long-term assets, net| . 3%| . 04%| . 2%| 1%| Notes receivable| —| 1. 8%| —| —| Long-term assets of held for sale subsidiary| | | 6. 3%| 7. 2%| Total assets| 100%| 100%| 100%| 100%| | | | | | Liabilities| | | | |Current liabilities:| | | | | Accounts payable| 36%| 30. 4%| 22. 1%| 30. 7%| Accrued liabilities| 14. 6%| 16. 1%| 14. 5%| 14. 1%| Deferred Revenue| 11%| 10%| 8. 8%| 2. 1%| Capital lease obligations| —| 1. 6%| 1. 9%| —| Current liabilities of held for sale subsidiary| | | 1. 4%| . 7%| Total current liabilities| 61. 6%| 58. 1%| 48. 7%| 47. 5%| Other long-term liabilities| 1. 5%| 1. 3%| —| —| Capital lease obligations, non-current| —| —| 1. 5%| . 9%| Convertible senior notes| 38. 6%| 32. 7%| 28. 5%| 23%| Total liabilities| 101. 7%| 92. 1%| 78. 7%| 71. 5%| | | | | | Stockholders’ Equity| | | | | Stockholders’ equity (deficit):| | | | |Preferred stock| —| —| —| —| Common stock| —| —| —| —| Additional paid in capital| 196. 4%| 144. 5%| 123. 2%| 77%| Accumulated deficit| -153. 7%| -109. 2%| -77. 3%| -29. 7%| Treasury stock| -44. 5%| -27. 4%| -24. 6%| -20%| Accumulated other comprehensive income (loss)| . 03%| -. 04%| -. 05%| . 3%| Total stockholders’ equity (deficit)| -1. 7%| 7. 9%| 21. 3%| 27. 5%| Total liabilities and stockholders’ equity (deficit)| 100%| 100%| 100%| 100%| Overstock Restated Trend Consolidated Balance Sheets (2005 = 100%)| | | | | | | December 31,| | 2008| 2007| 2006| 2005| Assets| | | | | Current Assets:| | | | | Cash and cash equivalents| 180%| 181. 5%| 227. %| 100%| Marketable securities| 16. 1%| 82. 4%| —| 100% | Cash, cash equivalents and marketable securities| 98. 1%| 132%| 113. 7%| 100%| Accounts receivable, net| 69. 7%| 111. 8%| 163%| 100%| Notes receivable| 18. 7%| 22. 5%| 100%| | Inventories, net| 19%| 27. 5%| 25. 7%| 100%| Prepaid inventory, net| 7. 9%| 37. 1%| 23. 3%| 100%| Prepaid expense| 114. 4%| 89. 3%| 88. 2%| 100%| Current assets of held for sale subsidiary| —| —| 229. 7%| 100%| Total current assets| 62. 1%| 83. 7%| 80. 1%| 100%| Restricted cash| —| —| —| 100%| Fixed assets, net| 38%| 44. 7%| 92. 4%| 100%| Goodwill| 100%| 100%| 100%| 100%| Other long-term assets, net| 16. 1%| 2. %| 17. 3%| 100%| Notes receivable| —| 100%| —| —| Long-term assets of held for sale subsidiary| | | 70. 4%| 100%| Total assets| 53%| 71%| 81. 1%| 100%| | | | | | Liabilities| | | | | Current liabilities:| | | | | Accounts payable| 62%| 70. 2%| 58. 3%| 100%| Accrued liabilities| 54. 8%| 80. 9%| 83. 7%| 100%| Deferred Revenue| 284. 7%| 343. 6%| 347 . 4%| 100%| Capital lease obligations| —| 74. 8%| 100%| 00%| Current liabilities of held for sale subsidiary| | | 170. 5%| 100%| Total current liabilities| 68. 6%| 86. 6%| 83. 1%| 100%| Other long-term liabilities| 84. 8%| 100%| —| —00%| Capital lease obligations, non-current| —| —| 130. %| 100%| Convertible senior notes| 88. 8%| 101%| 100. 5%| 100%| Total liabilities| 75. 3%| 91. 4%| 89. 3%| 100%| | | | | | Stockholders’ Equity| | | | | Stockholders’ equity (deficit):| | | | | Preferred stock| —| —| —| —00%| Common stock| 100%| 100%| 100%| 100%| Additional paid in capital| 134. 9%| 133. 1%| 129. 8%| 100%| Accumulated deficit| 273. 7%| 260. 6%| 211%| 100%| Treasury stock| 117. 4%| 96. 9%| 99. 5%| 100%| Accumulated other comprehensive income (loss)| 5%| -9. 8%| -13. 7%| 100%| Total stockholders’ equity (deficit)| -3. 3%| 20. 3%| 62. 8| 100%| Total liabilities and stockholders’ equity (deficit)| 52. 9%| 70. 9%| 81. 1%| 100%|Amazon Consolidated Statements of Operations (in millions)| | | | Year Ended December 31,| | 2008| 2007| 2006| 2005| Net sales| 19,166| 14,835| 10,711| 8,490| Cost of sales| 14,896| 11,482| 8,255| 6,451| Gross profit| 4,270| 3,353| 2,456| 2,039| Operating expenses:| | | | | Fulfillment| 1,658| 1,292| 937| 745| Marketing| 482| 344| 263| 198| Technology and content| 1,033| 818| 662| 451| General and administrative| 279| 235| 195| 166| Other operating expense (income), net| (24)| 9| 10| 47| Total operating expenses| 3,428| 2,698| 2,067| 1,607| Income from operations| 842| 655| 389| 432| Interest income| 83| 90| 59| 44| Interest expense| (71)| (77)| (78)| (92)| Other income (expense), net| 47| (8)| 7| 2|Total non-operating income (expense)| 59| 5| 12| 42| Income before income taxes| 901| 660| 377| 428| Provision for income taxes| (247)| (184)| (187)| 95| Equity-method investment activity, net of tax| (9)| —| —| —| Income before cumulati ve effect of change in accounting principle| | | | 333| Cumulative effect of change in accounting principle| | | | 26| Net income| 645| 476| 190| 359| Amazon Common-Size Consolidated Statements of Operations| | | | | | | Year Ended December 31,| (% of sales)| 2008| 2007| 2006| 2005| Net sales| 100%| 100%| 100%| 100%| Cost of sales| 77. 7%| 77. 4%| 77. 1%| 76%| Gross profit| 22. 3%| 22. 6%| 22. 9%| 24%| Operating expenses:| | | | |Fulfillment| 8. 7%| 8. 7%| 8. 7%| 8. 8%| Marketing| 2. 5%| 2. 3%| 2. 5%| 2. 3%| Technology and content| 5. 4%| 5. 5%| 6. 2%| 5. 3%| General and administrative| 1. 5%| 1. 6%| 1. 8%| 2%| Other operating expense (income), net| -. 1%| . 06%| . 09%| . 6%| Total operating expenses| 17. 9%| 18. 2%| 19. 3%| 18. 9%| Income from operations| 4. 4%| 4. 4%| 3. 6%| 5. 1%| Interest income| . 4%| . 6%| . 6%| . 5%| Interest expense| -. 4%| -. 5%| -. 7%| -1. 1%| Other income (expense), net| . 2%| -. 05%| . 07%| . 02%| Total non-operating income (expense)| . 3%| . 03%| . 1%| . 5%| Income before income taxes| 4. 7%| 4. 4%| 3. 5%| 5%| Provision for income taxes| -1. 3%| -1. %| -1. 7%| 1. 1%| Equity-method investment activity, net of tax| -. 05%| —| —| —| Income before cumulative effect of change in accounting principle| | | | 3. 9%| Cumulative effect of change in accounting principle| | | | . 3%| Net income| 3. 4%| 3. 2%| 1. 8%| 4. 2%| | | | | | | Amazon Trend Consolidated Statements of Operations (2005 = 100%)| | | | | | | For Year Ended December 31,| | 2008| 2007| 2006| 2005| Net sales| 225. 7%| 174. 7%| 126. 2%| 100%| Cost of sales| 231%| 178%| 1278%| 100%| Gross profit| 209. 4%| 164. 4%| 120. 5%| 100%| Operating expenses:| | | | | Fulfillment| 222. 6%| 173. 4%| 125. 8%| 100%| Marketing| 243. 4%| 173. %| 132. 8%| 100%| Technology and content| 229%| 181. 4%| 146. 8%| 100%| General and administrative| 168. 1%| 141. 6%| 117. 5%| 100%| Other operating expense (income), net| -51. 1%| 19. 1%| 21. 3%| 100%| Total operating expenses| 213. 3%| 167. 9%| 128. 6%| 100%| Income from operations| 194. 9%| 151. 6%| 90%| 100%| Interest income| 180. 6%| 204. 5%| 134. 1%| 100%| Interest expense| 77. 2%| 83. 7%| 84. 8%| 100%| Other income (expense), net| 2350%| -400%| 350%| 100%| Total non-operating income (expense)| 140. 5%| 11. 9%| 28. 6%| 100%| Income before income taxes| 210. 5%| 154. 2%| 88. 1%| 100%| Provision for income taxes| -260%| -193. 7%| -196. %| 100%| Equity-method investment activity, net of tax| 100%| —| —| —| Income before cumulative effect of change in accounting principle| | | | 100%| Cumulative effect of change in accounting principle| | | | 100%| Net income| 179. 7%| 132. 6%| 52. 9%| 100%| Amazon Consolidated Balance Sheets (in millions)| | | | December 31,| | 2008| 2007| 2006| 2005| | Assets| Current assets:| | | | | Cash and cash equivalents| 2,769| 2,539| 1,022| 1,013| Marketable securities| 958| 573| 997| 987| Inventories| 1,399| 1,200| 877| 566| Accounts receivable, net and other| 8 27| 705| 399| 274| Deferred tax assets| 204| 147| 78| 89| Total current assets| 6,157| 5,164| 3,373| 2,929| Fixed assets, net| 854| 543| 457| 348| Deferred tax assets| 145| 260| 199| 223|Goodwill| 438| 222| 195| 159| Other assets| 720| 296| 139| 37| Total assets| 8,324| 6,485| 4,363| 3,696| | Liabilities and Stockholders’ Equity| Current liabilities:| | | | | Accounts payable| 3,594| 2,795| 1,816| 1,366| Accrued expenses and other| 1,093| 902| 716| 533| Current portion of long-term debt| 59| 17| —| —| Total current liabilities| 4,746| 3,714| 2,532| 1,899| Long-term debt| 409| 1,282| 1,247| 1,480| Other long-term liabilities| 487| 292| 153| 71| Commitments and contingencies| | | | | Stockholders’ equity:| | | | | Preferred stock| —| —| —| —| Common stock| 4| 4| 4| 4| Treasury stock, at cost| (600)| (500)| (252)| —|Additional paid-in capital| 4,121| 3,063| 2,517| 2,263| Accumulate other comprehensive income (loss)| (123)| 5| (1)| 6| Accumulated deficit| (730)| (1,375)| (1,837)| (2,027)| Total stockholders’ equity| 2,672| 1,197| 431| 246| Total liabilities and stockholders’ equity| 8,314| 6,485| 4,363| 3,696| Amazon Common-Size Consolidated Balance Sheets| | | | | | | December 31,| (% of total assets)| 2008| 2007| 2006| 2005| Assets| | | | | Current assets:| | | | | Cash and cash equivalents| 33. 3%| 39. 2%| 23. 4%| 27. 4%| Marketable securities| 11. 6%| 8. 8%| 22. 9%| 26. 7%| Inventories| 16. 8%| 18. 5%| 20. 1%| 15. 3%| Accounts receivable, net and other| 9. 9%| 10. 9%| 9. 1%| 7. 4%| Deferred tax assets| 2. 5%| 2. 3%| 1. 8%| 2. 4%|Total current assets| 74%| 79. 6%| 77. 3%| 79. 2%| Fixed assets, net| 10. 3%| 8. 4%| 10. 5%| 9. 4%| Deferred tax assets| 1. 7%| 4%| 4. 6%| 6%| Goodwill| 5. 3%| 3. 4%| 4. 5%| 4. 3%| Other assets| 8. 6%| 4. 6%| 3. 2%| 1%| Total assets| 100%| 100%| 100%| 100%| | | | | | Liabilities| | | | | Current liabilities:| | | | | Accounts payable| 43. 2%| 43. 1%| 41. 6%| 3 7%| Accrued expenses and other| 13. 1%| 13. 9%| 16. 4%| 14. 4%| Current portion of long-term debt| . 7%| . 3%| —| —| Total current liabilities| 57%| 57. 3%| 58%| 51. 4%| Long-term debt| 4. 9%| 19. 8%| 28. 6%| 40%| Other long-term liabilities| 5. 9%| 4. 5%| 3. 5%| 1. 9%| | | | | | Stockholders’ Equity| | | | |Preferred stock| —| —| —| —| Common stock| . 05%| . 06%| . 09%| . 1%| Treasury stock, at cost| -7. 2%| -7. 7%| -5. 8%| —| Additional paid-in capital| 49. 5%| 47. 2%| 57. 7%| 61. 2%| Accumulate other comprehensive income (loss)| -1. 5%| . 08%| -. 02%| . 2%| Accumulated deficit| -8. 8%| -21. 2%| -42. 1%| -54. 8%| Total stockholders’ equity| 32. 1%| 18. 5%| 9. 9%| 6. 7%| Total liabilities and stockholders’ equity| 100%| 100%| 100%| 100%| | | | | | Amazon Trend Consolidated Balance Sheets (2005 = 100%)| | | | | | | December 31,| | 2008| 2007| 2006| 2005| Assets| | | | | Current assets:| | | | | Cash and cash equiv alents| 273. 3%| 250. 6%| 100. %| 100%| Marketable securities| 97. 1%| 58. 1%| 101%| 100%| Inventories| 247. 2%| 212%| 155%| 100%| Accounts receivable, net and other| 301. 8%| 257. 3%| 145. 6%| 100%| Deferred tax assets| 229. 2%| 165. 2%| 87. 6%| 100%| Total current assets| 210. 2%| 176. 3%| 115. 2%| 100%| Fixed assets, net| 245. 4%| 156%| 131. 3%| 100%| Deferred tax assets| 65%| 116. 6%| 89. 2%| 100%| Goodwill| 275. 5%| 139. 6%| 122. 6%| 100%| Other assets| 1945. 9%| 800%| 375. 7%| 100%| Total assets| 225. 2%| 175. 5%| 118%| 100%| | | | | | Liabilities| | | | | Current liabilities:| | | | | Accounts payable| 263. 1%| 204. 6%| 132. 9%| 100%| Accrued expenses and other| 205. 1%| 169. %| 134. 3%| 100%| Current portion of long-term debt| 347. 1%| 100%| —| —| Total current liabilities| 249. 9%| 195. 6%| 133. 3%| 100%| Long-term debt| 27. 6%| 86. 6%| 84. 3%| 100%| Other long-term liabilities| 685. 9%| 411. 3%| 215. 5%| 100%| | | | | | Stockholders’ Equity| | | | | Pr eferred stock| —| —| —| —| Common stock| 100%| 100%| 100%| 100%| Treasury stock, at cost| 240%| 200%| 100%| —| Additional paid-in capital| 182. 1%| 135. 4%| 111. 2%| 100%| Accumulate other comprehensive income (loss)| -2050%| 83. 3%| -16. 7%| 100%| Accumulated deficit| 36%| 67. 8%| 90. 1%| 100%| Total stockholders’ equity| 1086. 2%| 486. 6%| 175. %| 100%| Total liabilities and stockholders’ equity| 224. 9%| 175. 5%| 118%| 100%| Overstock Financial Ratios| | | | | | 2008| 2007| 2006| Return on assets (net)(ROA)| -6. 23%| -18. 09%| -34. 43%| Return on equity (net) (ROE)| -105. 88%| -101. 39%| -131. 38%| Return on income (Operating) (ROI)| -12. 82%| -32. 94%| -57. 89%| EBITDA Margin| 1. 24| -1. 6| -7. 8| Calculated tax rate| —| —| —| Revenue per employee| $803,173| $900,665| $912,211| Quick ratio| 1. 04| 1. 21| 1. 2| Current ratio| 1. 37| 1. 56| 1. 57| Net current assets| 23. 01%| 30. 64%| 24. 54%| Long-term debt to equity| —| 2. 82| 1. 28| Total debt to equity| —| 2. 96| 1. 36|Interest coverage| —| —| —| Total asset turnover| 4. 11x| 3. 05x| 2. 67x| Receivables turnover| 75. 49x| 47. 29x| 52. 48x| Inventory turnover| 31. 68x| 27. 38x| 12. 21x| Accounts payable turnover| 12. 53x| 11. 12x| 9. 41x| Accrued expenses turnover| 27. 55x| 20. 9x| 19. 13x| Property, plant and equipment turnover| 33. 06x| 18. 23x| 13. 35x| Cash and cash equivalents turnover| 6. 48x| 5. 54x| 6. 6x| | | | | Amazon Financial Ratios| | | | | | 2008| 2007| 2006| Return on assets (net)(ROA)| 8. 69%| 8. 78%| 4. 72%| Return on equity (net) (ROE)| 33. 25%| 58. 48%| 56. 13%| Return on income (Operating) (ROI)| 28. 93%| 30. 9%| 22. 45%| EBITDA Margin| 6. 26%| 6. 1%| 5. 56%|Calculated tax rate| 27. 41%| 27. 88%| 49. 6%| Revenue per employee| $923,364| $872,647| $770,576| Quick ratio| . 96| 1. 03| . 95| Current ratio| 1. 3| 1. 39| 1. 33| Net current assets| 16. 97%| 22. 36%| 19. 28%| Long-term debt to equity| . 2| 1. 12| 2. 94| Total debt to equity| . 22| 1. 12| 2. 94| Interest coverage| —| —| 20. 47x| Total asset turnover| 2. 58x| 2. 74x| 2. 66x| Receivables turnover| 24. 95x| 26. 88x| 31. 83x| Inventory turnover| 11. 46x| 11. 06x| 11. 44x| Accounts payable turnover| 5. 98x| 6. 43x| 6. 73x| Property, plant and equipment turnover| 27. 36x| 29. 67x| 26. 61x| Cash and cash equivalents turnover| 5. 59x| 5. 78x| 5. 33x|