Wednesday, August 21, 2019

Determinants of Mutual Fund Growth in Pakistan

Determinants of Mutual Fund Growth in Pakistan This study is actually about the mutual fund growth and the determinants which are influencing on the growth of these funds. We ask whether the growth of funds is influences by the management fee, family proportion and the expense ratio or not. How much these variables influenced the growth of funds. We further check out the relation of the family assets and the return on the funds with the performance of the funds. Investors are paying the charges to control the funds and for the growth of the funds in the shape of management fee and the administrative charges. We study the behavior and the output of the funds from the duration of 2005-2009. We selected the funds which are listed in KSE. The funds are selected which are in the family proportions because of the nature of regression model which is used for the calculation of the effect of determinants on the growth of the funds. We use two models for the interpretation of the data. These are fixed effect model and cross section model. Through these models we elaborate the effects of different factors on the growth of these funds. We focus on the management fee for checking the efficiency of the funds management. Whether these are contributing in the growth of the funds or not, if not then these fee is only for the benefit of funds management INTRODUCTION In Pakistan the mutual fund industry handles a significant portion of the assets of individual investors. Basically there are many factors which can affects on the growth of the mutual fund. In these determinants of the mutual funds which can affect the growth of the mutual fund we are focusing on the management fee, the main focus is on the charging of the management fee and its impact on the growth. Whether it is beneficial for the growth or not? Along with this we are determining some other major determinants of which can influence on the growth of these funds in Pakistan. Compensation to managers is primarily in the form of a Management fee. With few exceptions, Management fees are charged as a percentage of the assets under management rather than on the basis of performance. It is therefore in the interest of management to grow the total assets in the fund and in the associated fund family. One tool that managers may use to grow funds is the Management fee. The fees, which are l imited to1% to 3% per year as Management fee, are used to cover administrative costs. This paper studies whether or not the charging of a Management fee support the investors by growing the worth of mutual funds family along with that of some other determinants. Next we checked that the charging of Management fee leads to greater cash inflow for the funds which charge them. We focus on various mutual funds existing in the Karachi Stock Exchange and listed there, in order to control for the variety of commission payment schemes associated with management fee charging funds that are now available to shareholders and are in the group of families charging Management fee. LITERATURE REVIEW These are some of the review from the experts and the researchers. Academic opinion on mutual fund fees is generally critical. Bogle, points out that the average cost of owning mutual funds has risen over 100 percent in the last sixty years. Freeman and Brown contend mutual fund advisory fees alone are excessively high. In their view the mutual fund industry is dominated by conflicts of interest where the mutual fund boards fail to negotiate arms-length management contracts with asset managers. In their view asset managers are over compensated for the services that they provide. Similarly Ang, Chen and Lin argue that the primary benefit that managers can provide to the shareholders is the reduction of expenses. The reason is that management has more control over expenses than over any other aspect of the return to the shareholders. Therefore, if managers are not working to reduce expenses they are failing to carry out their primary duty to the shareholders. Golec found that fund managers are compensated primarily on the basis of a percentage of the assets under management. That compensation scheme provides fund managers with a strong incentive to grow fund assets regardless of the degree to which such growth is consistent with shareholder welfare. Collins, along with Livingston and ONeal (1998) and ONeal (1999) argue that some investors pay to receive professional investment advice and assistance in the purchase of mutual funds. Essentially they argue that brokers provide some combination of resolving asymmetric information for investors and providing a needed service in completing and maintaining the required records in order to complete the investing process. We closely examine the issue of whether brokers primarily resolve asymmetric information or primarily provide investors with record completion and maintenance services. One way to grow the assets is to well manage the fund by the fund management of that varies funds. Management f ees provide a source of funds for controlling and managing the funds. Naim Sipra (2008) one of the interesting things to note is the low correlation between the funds and the market portfolio. In US studies the correlation between the market and mutual funds is often 0.9 or above. A high correlation with the market is an indication of a high degree of diversification. The low correlation in the Pakistani case suggests that the mutual funds are not doing a very good job of diversification. The low correlation and also the low betas are probably due to inclusion of fixed income securities such as the Term Finance Certificates (TFCs) in the portfolios of these funds. Since the composition of the funds is not publicly known therefore it is not possible to analyze this issue any further. Ali S M, Malik A S (2006) A Capital markets play a vital role in the economic development of a country. It is now widely accepted that there is a direct correlation between economic growth and the development of the financial sector. Mutual funds are considered to be an imp ortant source of injecting liquidity into the capital markets. A well established financial intermediation system facilitates the economic activity by mobilizing domestic as well as foreign savings. Muhammad Akbar Saeed (2004) during the last two years, mutual fund sector has more than tripled in size to Rs. 112 billion (as of 31-Dec-04). The industry players are predicting that the business is likely to grow by 200 percent over the next five years. The success of the industry will lie in several factors, one of which will be the role of regulators and their efforts to continuously evolve the code of corporate governance for the mutual fund industry. Moeen Cheema and Sikandar A. shah (2006) Mutual funds are becoming vehicles of securities investments most favored by the general public worldwide. Whereas, this trend is more pronounced in the developed securities markets of the United States of America and Europe, mutual funds are increasingly gaining the public attention in the developing economies as well. Pakistan is not an exception to this global trend and even though mutual funds form a comparatively small segment of the securities markets, they have grown phenomenally over the last few years. According to the Mutual Fund Association of Pakistan (MUFAP), whereas mutual funds may not shield investors from the risks associated with overall market failure, the ability to diversify that they provide may reassure public investors as regards the failure of individual companies and hence make them less wary of insider opportunism in any given corporation. We similarly consult some of the related articles for this purpose, which can be seen from the references. We also consult some of the conflicting matters with the course instructor. In summary, Management fee is basically for the controlling of the mutual funds and for the growing purpose of the funds. But is it working well for the growth of the mutual funds which funds are being charging this fee. HYPOTHESES AND METHODOLOGY This paper studies whether the shareholders income and their wealth increase from the growth of the mutual funds through the charging of Management fees. The main focus on the Management Fee but there are some other determinants like family proportion, expense ratio, return through sharp ratio and assets turnover in that specific duration which we selected for the research purpose. There are a number of ways in which investors could enjoy by the growing of wealth from funds which charge this fee. Since the fee is used for administrative expenses. It could aid investors by making them aware of high quality managed funds that might otherwise be invisible to them. There are several possible examples of funds where this might apply. First, funds charging this management fee lead the higher total returns. Funds with greater total returns would benefit investors in that, if the superior performance was persistent, investors would have a higher terminal wealth from investing in these funds than they would have from investing in other funds. A fee showing the existence superior total returns would be of great of interest to investors. The null hypothesis: Ho: There is no difference between the total returns of mutual funds that charge the Management fee and those that do not charge the Management fee will be tested. Second, the Management fee might be a signal to investors of a greater risk adjusted rate of return. A greater risk adjusted return would imply that investors could earn superior returns with less chance of loss with respect to other portfolios offering the same level of return. The second null hypothesis to be tested is: Ho: There is no difference in risk adjusted returns between the risk adjusted return of mutual funds that charge the Management fee and those that do not charge the Management fee. 2nd hypothesis will be tested using Sharpe Ratio. It needs to be noted that these null hypotheses could be rejected either because the funds charging the Management fee over perform or because they under perform. If there is persistent over performance, the over performance is in the interest of the investors. However, persistent under performance would mean that the fee being paid by the investors is being used to let them know that these mutual funds are not performing well that will leave the investors with less terminal wealth. Such a result would be consistent with the view that Management fees are inconsistent with shareholders income growth. Third, the funds charging the Management fee could be the funds that have lower expense ratios. The numerator of the expense ratio includes all of the operating costs of managing the fund; including the management fee and other administrative costs as well as all the expenses. It may be that after the Management fee is removed from the expense ratio the fund has lower expenses than other funds. Such a result would support the idea that the fee itself is merely a substitute for other costs and that the investor in such a fund is no worse off, and could be better off than the investor in a fund that does not have the fee. The null hypothesis to be tested is: Ho: There is no difference of the expense ratios of the funds on the growth of the mutual funds. 3rd hypothesis will be tested after subtracting the Management fee from the expense ratio. The null hypothesis could be rejected because the funds charging the fee have lower expense ratios or because the funds charging the fee have greater expense ratios. In the first case the management fee would be in the interests of shareholders and in the second case the fee would not be in the interests of shareholders. If it is found that the management fee is not supporting the growth of the mutual funds of shareholders, the other alternative is that the fee is in the favor of the fund management. It would be in the interest of fund management to charge the management fee if the existence of the fee led to faster asset growth than could otherwise be expected. Management desires faster asset growth because of the manner in which management is compensated. Fourth, managers might be using management fees to grow funds more rapidly than they would otherwise be growing. The growth of the fund from time t to t+1 is defined as: Gi = (Assetst Assetst -1(1+R))/Assetst -1 (1)†¦Ã¢â‚¬ ¦Equation Where Gi is the growth rate in the assets under management by fund i from time t-1 to time t. Assetst are the net assets under management at time t. Since the assets under management may grow either due to new sales or returns, equation 1 eliminates the growth that is due to returns. For all of the funds in the study, the management fee is based on the net assets under management which may provide a managerial incentive to grow the fund as rapidly as possible. Ho: The growth rate of mutual funds that charge management fee is higher as compare to the funds which are not charging the fee. We will test whether the funds that charge the fees actually are growing faster using a regression model that controls for risk adjusted return, asset turnover rate, the relative size of the mutual fund within a family of funds, the expense ratio of the fund other than the management fee and the level of the management fee. Gi = ÃŽ ² 0 + ÃŽ ² 1RARi + ÃŽ ² 2ATi + ÃŽ ² 3ASSETi + ÃŽ ² 4FAMPROi + ÃŽ ² 5ERi + ÃŽ ² 6FEEi + ÃŽ ² i †¦2) Equation Gi is the growth due to new investment in funds i from previous year t to current year t+1. Growth is defined by equation 1. This sign (?) Measures the sensitivity of the growth rate of the mutual fund to the specified factor in each case. An expected positive sign means that the growth rate is expected to respond positively to increases in the variable. An expected negative sign means that the growth rate is expected to respond negatively to increases in the variable. The expected sign is specified for each of the control variables. RARi is the risk adjusted returns on fund i from year t to t+1, estimated by using the Sharpe Ratio. In accordance with past findings, this control variable is hypothesized to have a positive sign and does take a positive sign. ATi is the asset turnover for fund i which is measured through the formula of Net Income divided by the Total Assets. Turnover is a measure of investing activity. The greater the turnover, the greater the cost of operating the fund. Holding all else equal, the greater the cost of operating the fund the lower the growth in the fund. This variable is hypothesized to have a negative sign and does have a negative sign. ASSETi is the total assets of fund i at time t. The larger a fund, generally, the older the fund is so that assets serve as a proxy for the age of the fund. The older a fund, the more well known the fund is to the investing public and the easier it will be to sell the fund. Assets are expected to and do have a positive relation with growth. FAMPROi is the proportion of the mutual fund family assets made up by fund i. The larger the proportion of the family assets in the fund the slower will be the growth, as management efforts will be directed primarily at the newer, smaller funds. This variable is expected to have a negative sign and generally has a negative sign. ERi is the expense ratio of fund i , less the management fee from all the expenses. The expense ratio includes all of the costs that the management company charges to the fund including the management fee, trading costs, and any other expenses. Since the purpose of the test is to isolate the effect of the management fee, that fee is subtracted from the expense ratio. The greater the expense ratio, the lower the growth. Investors should prefer a lower cost fund to a higher cost fund. The variable generally has the expected negative sign. FEEi is the level of the Management fee. For the vast majority of the funds in the study, this variable will be charged by 1% to 3%. It is expected that the null hypothesis will be rejected and that this variable will have a positive sign which is generally the case. The regression model (Equation 2) is estimated on an annual basis for the years 2004 through 2009 for all funds that have all required data available. Equity and fixed income funds are examined separately. A positive and significant sign on the FEE variable will lead to a rejection of the null hypothesis and will be consistent with the idea that the Management fee is used by management to increase growth in assets. There are two economic rationales that apply to the imposition of the Management fee on mutual fund investors. The first is that investors are the primary beneficiaries. The second is that fund management is the primary beneficiary of the fee. The major contribution of this paper is to determine whether the facts are more consistent with the investors or the managers being the beneficiaries for mutual funds. THE DATA All of the data are taken for the years 2004 through 2009. Since 2004 is the first year and lagged data is needed, the results are presented for all funds for which all data was available for 2005 through 2009. The data are summarized in the table form and data is regarding the equity funds. As far as the collection of the data is concerned so we consult many sources for the collection of the data. Mainly we collect it from KSE. From where the full data was not available and after that we consult the Business recorder, Statistical Bulletin of Pakistan [Federal Bureau of Statistics (2005)] for 2005-2009 and SBP for the collection of the financial reports and the kibor rates. The net asset values are collected from the KSE as well as from Brecorder. The data available in the form of tables and excel sheet which is attach along with this article. Mainly we collect the data of the equity mutual funds. Our focus was on most commonly known mutual funds of the Pakistan market. We selected a lmost 21 mutual funds from the KSE available sources but because of the running of Regression Model, for which we need only the family funds which are in the form of groups. We neglect the individual funds because of the family proportion concern. So now the data available is of 13 mutual funds which are in the form of family. From that we could generate the family proportion of the mutual funds assets. Because the amount of the data was less for five years so we take the data in the panel form representing through panel EGLS. RESULTS These are some of the results which we conclude from the help of the CROSS SECTION MODEL FIXED EFFECT MODEL. In econometrics and statistics, a fixed effects model is a statistical model that represents the observed quantities in terms of explanatory variables that are all treated as if those quantities were non-random. This is in contrast to random effects models and mixed models in which either all or some of the explanatory variables are treated as if they arise from the random causes. Often the same structure of model, which is usually a linear regression model, can be treated as any of the three types depending on the analysts viewpoint, although there may be a natural choice in any given situation. In panel data analysis, the term fixed effects estimator (also known as the within estimator) is used to refer to an estimator for the coefficients in the regression model. If we assume fixed effects, we impose time independent effects for each entity that are possibly correlated with the regressors. The major attraction of fixed effects methods in non-experimental research is the ability to control for all stable characteristics of the individuals in the study, thereby eliminating potentially large sources of bias. Within-subject comparisons have also been popular in certain kinds of designed experiments known as changeover or crossover designs (Senn 1993). In these designs, subjects receive different treatments at different times, and a response variable is measured for each treatment. Ideally, the order in which the treatments are received is randomized. The objective of the crossover design is not primarily to reduce bias, but to reduce sampling variability and hence produce more powerful tests of hypotheses. Fixed effects methods cannot estimate coefficients for variables that have no within-subject variation Time-series cross-section (TSCS) data harness both cross-temporal and cross spatial variation to maximize empirical leverage for theory evaluation. However, this powerful data structure also requires careful consideration of temporal and spatial (cross-unit) heterogeneity, temporal and spatial dynamic processes, and potentially complex stochastic error structures. In the table 1 which is descriptive table and that is showing the mean, median and standard deviation as well. As it is clear and shows from the descriptive table that the sharp ratio, which is basically the return calculation through the sharp measure, is the negative impact on the growth of the mutual fund. As you will increase the return on the funds or the return increases over the amount of the funds the impact of it is negative on the growth of the mutual fund. Similarly the coefficient of this sharp ratio is also negative impact on the growth of the mutual funds. Now secondly, the asset turnover showing, the mean in the descriptive table representing the negative value which means that if the asset turnover will be negative so it can reduce the growth of the mutual funds. Assets are in the positive form and they show that if the asset of the fund increases so it means that the impact of this on the growth of the fund is positive and it contribute in the growth of the mutual fu nd. The family proportion of the mutual fund should have the positive impact on the growth of the mutual fund and in the table 1 of the descriptive result, the result of this is positive so it means that the family proportion increasing in this which is the positively impacting on the growth. Expense ratio is resulting negatively on the growth of the funds, and the management fee which is the basic testing of this is also showing the negative impact on the growth of the mutual funds in Pakistan. TABLE NO. 1 Descriptive Analysis GR SR AT ASSET FP ER FEE MEAN 3.989 -1.096 -0.008 2633207 0.365 1.262 54455166 MEDIAN 0.005 -0.540 0.010 1435134 0.410 1.260 38342000 MAX. 63.590 2.290 0.450 14193216 1.000 10.900 2.49708 MIN. -27.660 -5.010 -1.070 0.00000 0.000 0.000 0.00000 STD. DEV 12.763 1.470 0.272 3060791 0.255 1.644 53774795 SKEW. 2.134 -0.946 -1.834 1.951847 0.187 4.008 1.599424 PROB. 0.000 0.004 0.000 0.0000 0.729 0.000 0.0000 SUM 259.290 -71.278 -0.525 1.71608 23.400 82.060 3.54709 OBS. 65 65 65 65 65 65 65 TABLE NO. 2 Correlation Matrix DETERMINANTS GR SR AT ASSETS FP ER FEE GR 1.000 -0.269 -0.578 -0.163 0.062 0.100 -0.146 SR -0.269 1.000 0.360 0.124 0.174 -0.186 0.132 AT -0.578 0.306 1.000 0.139 0.071 -0.403 0.125 ASSETS -0.163 0.123 0.193 1.000 0.503 0.084 0.972 FP 0.061 0.174 0.071 0.503 1.000 0.270 0.538 ER 0.100 -0.187 -0.403 0.084 0.270 1.000 0.058 FEE -0.146 0.133 0.125 0.972 0.538 0.058 1.000 Now further according to the table 3 which is Fixed Effect Model, we design a panel least squares method in this model for the calculation of the data, in that the sharp ratio is resulting in the negative form and show the result that as the return on the mutual funds increases the growth effected negatively. The coefficient of the sharp ratio is negative and the result is showing significance, which is acceptable. After that assets turnover of it is in negative figure which shows a negative impact on the growth and the prob. Is significance we are keeping the level of the significance here is 0.10. The coefficient of the family proportion is positive thats good for the growth of the mutual fund but it is not significance because the prob. is higher than the level of significance. The expense ratio is showing the negative result, which means that the increase of the expense ratio is a negative impact on the growth of the mutual funds. Its coefficient value is negative and the value i s significant according to the fixed effect model. Now comes the management fee, according to this model the management fee is resulting in the positive value for the fund, that means that the funds that using the Management fee are contributing in the better growth of the fund because the coefficient value is positive but according to this model the fee is not significant here, the result is that the funds charging the fee can make the funds growing as compare to the funds that are not charging the management fee. The factor we assume here that the management fee effect positively for the growth of the funds but because of the political instability and the country economic situation it is not resulting good in the growth of the mutual funds in Pakistan. Lastly according to this model, value of Lassets is positive and the significant level is good which shows the Lassets significant. We take the assets here despite of the assets because of the mismatch and not the proper results fro m the assets. So it is impacting positively on the growth of the mutual fund. If it increases the mutual fund growth will increase. TABLE NO. 3 Fixed Effect Model Dependent Variable: GR Method: Panel Least Squares Sample: 2005-2009 Total panel (unbalanced) observations: 64 Cross-sections included: 13 DETERMINANTS COEFFICIENT STD. ERROR T-STATISTICS PROB. SR -3.772 1.532 -2.462 0.018 AT -24.784 7.253 -3.417 0.001 LASSET 0.447 0.155 2.878 0.006 FP 4.932 9.653 0.512 0.612 ER -2.250 1.054 -2.135 0.038 FEE 1.637 1.427 1.144 0.258 CONSTANT -1.456 4.251 -0.343 0.734 EFFECTS SPECIFICATIONS CROSS-SECTION FIXED (DUMMY VARIABLES) PERIOD FIXED (DUMMY VARIABLES) ADJUSTIFIED R-SQUARED 0.438 MEAN.DEP BAR 4.051 S.E OF REGRESSION 9.639 S.D. DEP BAR 12.859 SUM SQUARED RESID 3810.045 SCHWARZ CRITERION 8.418 LONG LIKELIHOOD -221.580 F-STAT. 3.227 DURBIN–WATSON STAT 1.896 PROB F-STAT 0.000 In table 4 and 5, we use the CROSS SECTION MODEL (cross section random effects cross section weights), according to both of these methods the calculations are same, the coefficient values and the significant are same. The assets turnover is showing the negative value which shows according to it that the more assets turnover can impact the growth of the mutual funds and the value is significant in both methods as well as in the fixed effect model. The value of the sharp ratio means the return of the mutual fund is showing coefficient negative in the random effect method that means that the increase of the return value can effect the growth negatively and growth is less when this return value is high while the value is significant which means it is good for the growth of the mutual fund and same value is showing in the fixed effect method. But in the cross section weights method the value of the return is positive and it is not significant there. So it shows here a that the higher ret urn impact the mutual fund growth positively means higher the return higher the growth of the mutual fund nut it is nit the case here. Family proportion of the mutual funds according to the both methods says that the results are showing positive relationship in the growth of the funds and the higher the family proportion. The values are significant according to the probability measures. Expense ratio according to both of these models reflects the results that expense ratio is impacting the growth of the funds negatively. Means as the ratio of the expense increase the growth is going to be less for the mutual funds. The coefficient value of the expense ratio is in negative value and the value in both the methods shows that this is significant. As far as the Management fee is concerned here so according to the both methods the management fee is impacting on the growth inversely. The coefficient value in both the cases is negative means if the management fee is charged by the mutual fu nd management so the growth is less than if they dont charge the management fee. And the value is significant in both the methods. So it is clear from now that according to the Cross Section Model the impact of the management fee is negative on the growth of the mutual funds. The management who is charging the management fee their growth of the mutual funds is less and downward. TABLE NO. 4 Cross Section Weights Dependent Variable: GR Method: Panel EGLS (Cross Section Weights) Sample: 2005-2009 Total panel (unbalanced) observations: 54 Cross-sections included: 13 Linear Estimation after One-Step Weighting Matrix VARIABLE COEFFICIENT STD.ERROR T-STAT PROB SR 0.439 0.825 0.532 0.596 AT -32.916 3.815 -8.628 0.000 FP 4.404 3.353 2.506 0.016 ER -2.032 0.719 -2.825 0.006 FEE -5.297 1.997 -2.665 0.010 LASSET 0.447 0.155 2.877 0.006 WEIGHTED STATISTICS R-SQUARED 0.788 MEAN DEPENDENT VAR 7.211 ADJ. R-SQRD 0.766 S.D. DEPENDENT VAR 20.513 S.E. OF REG 9.905 SUM SQUARED RESID 4709.255 DURBIN-WATSON STAT 1.785 UN-WEIGHTED STATISTICS R-SQUARED 0.396 MEAN DEPENDENT VAR 4.801 SUM SQUARED RESID 6164.67 DURBIN-WATSON STAT 1.521 TABLE NO. 5 Cross Section Random Effect Model Dependent Variable: GR Method: Panel EGLS (Cross-Section random Weights) Sample: 2005-2009 Total panel (unbalanced) observations: 64 Cross-sections included: 13 Swamy and Arora estimator of component variances VARIABLE COEFFICIENT STD.ERROR T-STAT PROB CONSTANT 1.663 2.777 0.599 0.551 Determinants of Mutual Fund Growth in Pakistan Determinants of Mutual Fund Growth in Pakistan This study is actually about the mutual fund growth and the determinants which are influencing on the growth of these funds. We ask whether the growth of funds is influences by the management fee, family proportion and the expense ratio or not. How much these variables influenced the growth of funds. We further check out the relation of the family assets and the return on the funds with the performance of the funds. Investors are paying the charges to control the funds and for the growth of the funds in the shape of management fee and the administrative charges. We study the behavior and the output of the funds from the duration of 2005-2009. We selected the funds which are listed in KSE. The funds are selected which are in the family proportions because of the nature of regression model which is used for the calculation of the effect of determinants on the growth of the funds. We use two models for the interpretation of the data. These are fixed effect model and cross section model. Through these models we elaborate the effects of different factors on the growth of these funds. We focus on the management fee for checking the efficiency of the funds management. Whether these are contributing in the growth of the funds or not, if not then these fee is only for the benefit of funds management INTRODUCTION In Pakistan the mutual fund industry handles a significant portion of the assets of individual investors. Basically there are many factors which can affects on the growth of the mutual fund. In these determinants of the mutual funds which can affect the growth of the mutual fund we are focusing on the management fee, the main focus is on the charging of the management fee and its impact on the growth. Whether it is beneficial for the growth or not? Along with this we are determining some other major determinants of which can influence on the growth of these funds in Pakistan. Compensation to managers is primarily in the form of a Management fee. With few exceptions, Management fees are charged as a percentage of the assets under management rather than on the basis of performance. It is therefore in the interest of management to grow the total assets in the fund and in the associated fund family. One tool that managers may use to grow funds is the Management fee. The fees, which are l imited to1% to 3% per year as Management fee, are used to cover administrative costs. This paper studies whether or not the charging of a Management fee support the investors by growing the worth of mutual funds family along with that of some other determinants. Next we checked that the charging of Management fee leads to greater cash inflow for the funds which charge them. We focus on various mutual funds existing in the Karachi Stock Exchange and listed there, in order to control for the variety of commission payment schemes associated with management fee charging funds that are now available to shareholders and are in the group of families charging Management fee. LITERATURE REVIEW These are some of the review from the experts and the researchers. Academic opinion on mutual fund fees is generally critical. Bogle, points out that the average cost of owning mutual funds has risen over 100 percent in the last sixty years. Freeman and Brown contend mutual fund advisory fees alone are excessively high. In their view the mutual fund industry is dominated by conflicts of interest where the mutual fund boards fail to negotiate arms-length management contracts with asset managers. In their view asset managers are over compensated for the services that they provide. Similarly Ang, Chen and Lin argue that the primary benefit that managers can provide to the shareholders is the reduction of expenses. The reason is that management has more control over expenses than over any other aspect of the return to the shareholders. Therefore, if managers are not working to reduce expenses they are failing to carry out their primary duty to the shareholders. Golec found that fund managers are compensated primarily on the basis of a percentage of the assets under management. That compensation scheme provides fund managers with a strong incentive to grow fund assets regardless of the degree to which such growth is consistent with shareholder welfare. Collins, along with Livingston and ONeal (1998) and ONeal (1999) argue that some investors pay to receive professional investment advice and assistance in the purchase of mutual funds. Essentially they argue that brokers provide some combination of resolving asymmetric information for investors and providing a needed service in completing and maintaining the required records in order to complete the investing process. We closely examine the issue of whether brokers primarily resolve asymmetric information or primarily provide investors with record completion and maintenance services. One way to grow the assets is to well manage the fund by the fund management of that varies funds. Management f ees provide a source of funds for controlling and managing the funds. Naim Sipra (2008) one of the interesting things to note is the low correlation between the funds and the market portfolio. In US studies the correlation between the market and mutual funds is often 0.9 or above. A high correlation with the market is an indication of a high degree of diversification. The low correlation in the Pakistani case suggests that the mutual funds are not doing a very good job of diversification. The low correlation and also the low betas are probably due to inclusion of fixed income securities such as the Term Finance Certificates (TFCs) in the portfolios of these funds. Since the composition of the funds is not publicly known therefore it is not possible to analyze this issue any further. Ali S M, Malik A S (2006) A Capital markets play a vital role in the economic development of a country. It is now widely accepted that there is a direct correlation between economic growth and the development of the financial sector. Mutual funds are considered to be an imp ortant source of injecting liquidity into the capital markets. A well established financial intermediation system facilitates the economic activity by mobilizing domestic as well as foreign savings. Muhammad Akbar Saeed (2004) during the last two years, mutual fund sector has more than tripled in size to Rs. 112 billion (as of 31-Dec-04). The industry players are predicting that the business is likely to grow by 200 percent over the next five years. The success of the industry will lie in several factors, one of which will be the role of regulators and their efforts to continuously evolve the code of corporate governance for the mutual fund industry. Moeen Cheema and Sikandar A. shah (2006) Mutual funds are becoming vehicles of securities investments most favored by the general public worldwide. Whereas, this trend is more pronounced in the developed securities markets of the United States of America and Europe, mutual funds are increasingly gaining the public attention in the developing economies as well. Pakistan is not an exception to this global trend and even though mutual funds form a comparatively small segment of the securities markets, they have grown phenomenally over the last few years. According to the Mutual Fund Association of Pakistan (MUFAP), whereas mutual funds may not shield investors from the risks associated with overall market failure, the ability to diversify that they provide may reassure public investors as regards the failure of individual companies and hence make them less wary of insider opportunism in any given corporation. We similarly consult some of the related articles for this purpose, which can be seen from the references. We also consult some of the conflicting matters with the course instructor. In summary, Management fee is basically for the controlling of the mutual funds and for the growing purpose of the funds. But is it working well for the growth of the mutual funds which funds are being charging this fee. HYPOTHESES AND METHODOLOGY This paper studies whether the shareholders income and their wealth increase from the growth of the mutual funds through the charging of Management fees. The main focus on the Management Fee but there are some other determinants like family proportion, expense ratio, return through sharp ratio and assets turnover in that specific duration which we selected for the research purpose. There are a number of ways in which investors could enjoy by the growing of wealth from funds which charge this fee. Since the fee is used for administrative expenses. It could aid investors by making them aware of high quality managed funds that might otherwise be invisible to them. There are several possible examples of funds where this might apply. First, funds charging this management fee lead the higher total returns. Funds with greater total returns would benefit investors in that, if the superior performance was persistent, investors would have a higher terminal wealth from investing in these funds than they would have from investing in other funds. A fee showing the existence superior total returns would be of great of interest to investors. The null hypothesis: Ho: There is no difference between the total returns of mutual funds that charge the Management fee and those that do not charge the Management fee will be tested. Second, the Management fee might be a signal to investors of a greater risk adjusted rate of return. A greater risk adjusted return would imply that investors could earn superior returns with less chance of loss with respect to other portfolios offering the same level of return. The second null hypothesis to be tested is: Ho: There is no difference in risk adjusted returns between the risk adjusted return of mutual funds that charge the Management fee and those that do not charge the Management fee. 2nd hypothesis will be tested using Sharpe Ratio. It needs to be noted that these null hypotheses could be rejected either because the funds charging the Management fee over perform or because they under perform. If there is persistent over performance, the over performance is in the interest of the investors. However, persistent under performance would mean that the fee being paid by the investors is being used to let them know that these mutual funds are not performing well that will leave the investors with less terminal wealth. Such a result would be consistent with the view that Management fees are inconsistent with shareholders income growth. Third, the funds charging the Management fee could be the funds that have lower expense ratios. The numerator of the expense ratio includes all of the operating costs of managing the fund; including the management fee and other administrative costs as well as all the expenses. It may be that after the Management fee is removed from the expense ratio the fund has lower expenses than other funds. Such a result would support the idea that the fee itself is merely a substitute for other costs and that the investor in such a fund is no worse off, and could be better off than the investor in a fund that does not have the fee. The null hypothesis to be tested is: Ho: There is no difference of the expense ratios of the funds on the growth of the mutual funds. 3rd hypothesis will be tested after subtracting the Management fee from the expense ratio. The null hypothesis could be rejected because the funds charging the fee have lower expense ratios or because the funds charging the fee have greater expense ratios. In the first case the management fee would be in the interests of shareholders and in the second case the fee would not be in the interests of shareholders. If it is found that the management fee is not supporting the growth of the mutual funds of shareholders, the other alternative is that the fee is in the favor of the fund management. It would be in the interest of fund management to charge the management fee if the existence of the fee led to faster asset growth than could otherwise be expected. Management desires faster asset growth because of the manner in which management is compensated. Fourth, managers might be using management fees to grow funds more rapidly than they would otherwise be growing. The growth of the fund from time t to t+1 is defined as: Gi = (Assetst Assetst -1(1+R))/Assetst -1 (1)†¦Ã¢â‚¬ ¦Equation Where Gi is the growth rate in the assets under management by fund i from time t-1 to time t. Assetst are the net assets under management at time t. Since the assets under management may grow either due to new sales or returns, equation 1 eliminates the growth that is due to returns. For all of the funds in the study, the management fee is based on the net assets under management which may provide a managerial incentive to grow the fund as rapidly as possible. Ho: The growth rate of mutual funds that charge management fee is higher as compare to the funds which are not charging the fee. We will test whether the funds that charge the fees actually are growing faster using a regression model that controls for risk adjusted return, asset turnover rate, the relative size of the mutual fund within a family of funds, the expense ratio of the fund other than the management fee and the level of the management fee. Gi = ÃŽ ² 0 + ÃŽ ² 1RARi + ÃŽ ² 2ATi + ÃŽ ² 3ASSETi + ÃŽ ² 4FAMPROi + ÃŽ ² 5ERi + ÃŽ ² 6FEEi + ÃŽ ² i †¦2) Equation Gi is the growth due to new investment in funds i from previous year t to current year t+1. Growth is defined by equation 1. This sign (?) Measures the sensitivity of the growth rate of the mutual fund to the specified factor in each case. An expected positive sign means that the growth rate is expected to respond positively to increases in the variable. An expected negative sign means that the growth rate is expected to respond negatively to increases in the variable. The expected sign is specified for each of the control variables. RARi is the risk adjusted returns on fund i from year t to t+1, estimated by using the Sharpe Ratio. In accordance with past findings, this control variable is hypothesized to have a positive sign and does take a positive sign. ATi is the asset turnover for fund i which is measured through the formula of Net Income divided by the Total Assets. Turnover is a measure of investing activity. The greater the turnover, the greater the cost of operating the fund. Holding all else equal, the greater the cost of operating the fund the lower the growth in the fund. This variable is hypothesized to have a negative sign and does have a negative sign. ASSETi is the total assets of fund i at time t. The larger a fund, generally, the older the fund is so that assets serve as a proxy for the age of the fund. The older a fund, the more well known the fund is to the investing public and the easier it will be to sell the fund. Assets are expected to and do have a positive relation with growth. FAMPROi is the proportion of the mutual fund family assets made up by fund i. The larger the proportion of the family assets in the fund the slower will be the growth, as management efforts will be directed primarily at the newer, smaller funds. This variable is expected to have a negative sign and generally has a negative sign. ERi is the expense ratio of fund i , less the management fee from all the expenses. The expense ratio includes all of the costs that the management company charges to the fund including the management fee, trading costs, and any other expenses. Since the purpose of the test is to isolate the effect of the management fee, that fee is subtracted from the expense ratio. The greater the expense ratio, the lower the growth. Investors should prefer a lower cost fund to a higher cost fund. The variable generally has the expected negative sign. FEEi is the level of the Management fee. For the vast majority of the funds in the study, this variable will be charged by 1% to 3%. It is expected that the null hypothesis will be rejected and that this variable will have a positive sign which is generally the case. The regression model (Equation 2) is estimated on an annual basis for the years 2004 through 2009 for all funds that have all required data available. Equity and fixed income funds are examined separately. A positive and significant sign on the FEE variable will lead to a rejection of the null hypothesis and will be consistent with the idea that the Management fee is used by management to increase growth in assets. There are two economic rationales that apply to the imposition of the Management fee on mutual fund investors. The first is that investors are the primary beneficiaries. The second is that fund management is the primary beneficiary of the fee. The major contribution of this paper is to determine whether the facts are more consistent with the investors or the managers being the beneficiaries for mutual funds. THE DATA All of the data are taken for the years 2004 through 2009. Since 2004 is the first year and lagged data is needed, the results are presented for all funds for which all data was available for 2005 through 2009. The data are summarized in the table form and data is regarding the equity funds. As far as the collection of the data is concerned so we consult many sources for the collection of the data. Mainly we collect it from KSE. From where the full data was not available and after that we consult the Business recorder, Statistical Bulletin of Pakistan [Federal Bureau of Statistics (2005)] for 2005-2009 and SBP for the collection of the financial reports and the kibor rates. The net asset values are collected from the KSE as well as from Brecorder. The data available in the form of tables and excel sheet which is attach along with this article. Mainly we collect the data of the equity mutual funds. Our focus was on most commonly known mutual funds of the Pakistan market. We selected a lmost 21 mutual funds from the KSE available sources but because of the running of Regression Model, for which we need only the family funds which are in the form of groups. We neglect the individual funds because of the family proportion concern. So now the data available is of 13 mutual funds which are in the form of family. From that we could generate the family proportion of the mutual funds assets. Because the amount of the data was less for five years so we take the data in the panel form representing through panel EGLS. RESULTS These are some of the results which we conclude from the help of the CROSS SECTION MODEL FIXED EFFECT MODEL. In econometrics and statistics, a fixed effects model is a statistical model that represents the observed quantities in terms of explanatory variables that are all treated as if those quantities were non-random. This is in contrast to random effects models and mixed models in which either all or some of the explanatory variables are treated as if they arise from the random causes. Often the same structure of model, which is usually a linear regression model, can be treated as any of the three types depending on the analysts viewpoint, although there may be a natural choice in any given situation. In panel data analysis, the term fixed effects estimator (also known as the within estimator) is used to refer to an estimator for the coefficients in the regression model. If we assume fixed effects, we impose time independent effects for each entity that are possibly correlated with the regressors. The major attraction of fixed effects methods in non-experimental research is the ability to control for all stable characteristics of the individuals in the study, thereby eliminating potentially large sources of bias. Within-subject comparisons have also been popular in certain kinds of designed experiments known as changeover or crossover designs (Senn 1993). In these designs, subjects receive different treatments at different times, and a response variable is measured for each treatment. Ideally, the order in which the treatments are received is randomized. The objective of the crossover design is not primarily to reduce bias, but to reduce sampling variability and hence produce more powerful tests of hypotheses. Fixed effects methods cannot estimate coefficients for variables that have no within-subject variation Time-series cross-section (TSCS) data harness both cross-temporal and cross spatial variation to maximize empirical leverage for theory evaluation. However, this powerful data structure also requires careful consideration of temporal and spatial (cross-unit) heterogeneity, temporal and spatial dynamic processes, and potentially complex stochastic error structures. In the table 1 which is descriptive table and that is showing the mean, median and standard deviation as well. As it is clear and shows from the descriptive table that the sharp ratio, which is basically the return calculation through the sharp measure, is the negative impact on the growth of the mutual fund. As you will increase the return on the funds or the return increases over the amount of the funds the impact of it is negative on the growth of the mutual fund. Similarly the coefficient of this sharp ratio is also negative impact on the growth of the mutual funds. Now secondly, the asset turnover showing, the mean in the descriptive table representing the negative value which means that if the asset turnover will be negative so it can reduce the growth of the mutual funds. Assets are in the positive form and they show that if the asset of the fund increases so it means that the impact of this on the growth of the fund is positive and it contribute in the growth of the mutual fu nd. The family proportion of the mutual fund should have the positive impact on the growth of the mutual fund and in the table 1 of the descriptive result, the result of this is positive so it means that the family proportion increasing in this which is the positively impacting on the growth. Expense ratio is resulting negatively on the growth of the funds, and the management fee which is the basic testing of this is also showing the negative impact on the growth of the mutual funds in Pakistan. TABLE NO. 1 Descriptive Analysis GR SR AT ASSET FP ER FEE MEAN 3.989 -1.096 -0.008 2633207 0.365 1.262 54455166 MEDIAN 0.005 -0.540 0.010 1435134 0.410 1.260 38342000 MAX. 63.590 2.290 0.450 14193216 1.000 10.900 2.49708 MIN. -27.660 -5.010 -1.070 0.00000 0.000 0.000 0.00000 STD. DEV 12.763 1.470 0.272 3060791 0.255 1.644 53774795 SKEW. 2.134 -0.946 -1.834 1.951847 0.187 4.008 1.599424 PROB. 0.000 0.004 0.000 0.0000 0.729 0.000 0.0000 SUM 259.290 -71.278 -0.525 1.71608 23.400 82.060 3.54709 OBS. 65 65 65 65 65 65 65 TABLE NO. 2 Correlation Matrix DETERMINANTS GR SR AT ASSETS FP ER FEE GR 1.000 -0.269 -0.578 -0.163 0.062 0.100 -0.146 SR -0.269 1.000 0.360 0.124 0.174 -0.186 0.132 AT -0.578 0.306 1.000 0.139 0.071 -0.403 0.125 ASSETS -0.163 0.123 0.193 1.000 0.503 0.084 0.972 FP 0.061 0.174 0.071 0.503 1.000 0.270 0.538 ER 0.100 -0.187 -0.403 0.084 0.270 1.000 0.058 FEE -0.146 0.133 0.125 0.972 0.538 0.058 1.000 Now further according to the table 3 which is Fixed Effect Model, we design a panel least squares method in this model for the calculation of the data, in that the sharp ratio is resulting in the negative form and show the result that as the return on the mutual funds increases the growth effected negatively. The coefficient of the sharp ratio is negative and the result is showing significance, which is acceptable. After that assets turnover of it is in negative figure which shows a negative impact on the growth and the prob. Is significance we are keeping the level of the significance here is 0.10. The coefficient of the family proportion is positive thats good for the growth of the mutual fund but it is not significance because the prob. is higher than the level of significance. The expense ratio is showing the negative result, which means that the increase of the expense ratio is a negative impact on the growth of the mutual funds. Its coefficient value is negative and the value i s significant according to the fixed effect model. Now comes the management fee, according to this model the management fee is resulting in the positive value for the fund, that means that the funds that using the Management fee are contributing in the better growth of the fund because the coefficient value is positive but according to this model the fee is not significant here, the result is that the funds charging the fee can make the funds growing as compare to the funds that are not charging the management fee. The factor we assume here that the management fee effect positively for the growth of the funds but because of the political instability and the country economic situation it is not resulting good in the growth of the mutual funds in Pakistan. Lastly according to this model, value of Lassets is positive and the significant level is good which shows the Lassets significant. We take the assets here despite of the assets because of the mismatch and not the proper results fro m the assets. So it is impacting positively on the growth of the mutual fund. If it increases the mutual fund growth will increase. TABLE NO. 3 Fixed Effect Model Dependent Variable: GR Method: Panel Least Squares Sample: 2005-2009 Total panel (unbalanced) observations: 64 Cross-sections included: 13 DETERMINANTS COEFFICIENT STD. ERROR T-STATISTICS PROB. SR -3.772 1.532 -2.462 0.018 AT -24.784 7.253 -3.417 0.001 LASSET 0.447 0.155 2.878 0.006 FP 4.932 9.653 0.512 0.612 ER -2.250 1.054 -2.135 0.038 FEE 1.637 1.427 1.144 0.258 CONSTANT -1.456 4.251 -0.343 0.734 EFFECTS SPECIFICATIONS CROSS-SECTION FIXED (DUMMY VARIABLES) PERIOD FIXED (DUMMY VARIABLES) ADJUSTIFIED R-SQUARED 0.438 MEAN.DEP BAR 4.051 S.E OF REGRESSION 9.639 S.D. DEP BAR 12.859 SUM SQUARED RESID 3810.045 SCHWARZ CRITERION 8.418 LONG LIKELIHOOD -221.580 F-STAT. 3.227 DURBIN–WATSON STAT 1.896 PROB F-STAT 0.000 In table 4 and 5, we use the CROSS SECTION MODEL (cross section random effects cross section weights), according to both of these methods the calculations are same, the coefficient values and the significant are same. The assets turnover is showing the negative value which shows according to it that the more assets turnover can impact the growth of the mutual funds and the value is significant in both methods as well as in the fixed effect model. The value of the sharp ratio means the return of the mutual fund is showing coefficient negative in the random effect method that means that the increase of the return value can effect the growth negatively and growth is less when this return value is high while the value is significant which means it is good for the growth of the mutual fund and same value is showing in the fixed effect method. But in the cross section weights method the value of the return is positive and it is not significant there. So it shows here a that the higher ret urn impact the mutual fund growth positively means higher the return higher the growth of the mutual fund nut it is nit the case here. Family proportion of the mutual funds according to the both methods says that the results are showing positive relationship in the growth of the funds and the higher the family proportion. The values are significant according to the probability measures. Expense ratio according to both of these models reflects the results that expense ratio is impacting the growth of the funds negatively. Means as the ratio of the expense increase the growth is going to be less for the mutual funds. The coefficient value of the expense ratio is in negative value and the value in both the methods shows that this is significant. As far as the Management fee is concerned here so according to the both methods the management fee is impacting on the growth inversely. The coefficient value in both the cases is negative means if the management fee is charged by the mutual fu nd management so the growth is less than if they dont charge the management fee. And the value is significant in both the methods. So it is clear from now that according to the Cross Section Model the impact of the management fee is negative on the growth of the mutual funds. The management who is charging the management fee their growth of the mutual funds is less and downward. TABLE NO. 4 Cross Section Weights Dependent Variable: GR Method: Panel EGLS (Cross Section Weights) Sample: 2005-2009 Total panel (unbalanced) observations: 54 Cross-sections included: 13 Linear Estimation after One-Step Weighting Matrix VARIABLE COEFFICIENT STD.ERROR T-STAT PROB SR 0.439 0.825 0.532 0.596 AT -32.916 3.815 -8.628 0.000 FP 4.404 3.353 2.506 0.016 ER -2.032 0.719 -2.825 0.006 FEE -5.297 1.997 -2.665 0.010 LASSET 0.447 0.155 2.877 0.006 WEIGHTED STATISTICS R-SQUARED 0.788 MEAN DEPENDENT VAR 7.211 ADJ. R-SQRD 0.766 S.D. DEPENDENT VAR 20.513 S.E. OF REG 9.905 SUM SQUARED RESID 4709.255 DURBIN-WATSON STAT 1.785 UN-WEIGHTED STATISTICS R-SQUARED 0.396 MEAN DEPENDENT VAR 4.801 SUM SQUARED RESID 6164.67 DURBIN-WATSON STAT 1.521 TABLE NO. 5 Cross Section Random Effect Model Dependent Variable: GR Method: Panel EGLS (Cross-Section random Weights) Sample: 2005-2009 Total panel (unbalanced) observations: 64 Cross-sections included: 13 Swamy and Arora estimator of component variances VARIABLE COEFFICIENT STD.ERROR T-STAT PROB CONSTANT 1.663 2.777 0.599 0.551

Tuesday, August 20, 2019

Professional Ethics And Accountability Of Teachers Education Essay

Professional Ethics And Accountability Of Teachers Education Essay In a world of science and technology, it is education that determines the level of prosperity, welfare and security of the people. This is not a mere statement of faith in education as expressed by the Education Commission (1964-66) but a very well proven truth as well. While education of acceptable quality depends on many factors including curriculum, infrastructure, teaching-learning material and methods, educational technology, etc. yet the most important among these factors is the teacher. It is he who is directly responsible to operationalize the process of education, establish intimate contact with learners and motivate and train them in various aspects of their personality in a manner that they are successfully initiated into the society as its young, promising, productive and responsible members who are capable to face the challenges of life effectively. Like many other professionals, a teacher also needs initial education and training of reasonable length and quality which h as to be followed by regular life-long professional development equipment sharp and useful in the ever changing contexts. - 1Research Scholar, Department of Education, Ch. Devi Lal University, Sirsa. 2Teaching Associate, Department of Education, Ch. Devi Lal University, Sirsa. Introduction In India, the need of initial education and training of the would-be teacher for different levels of schools education is now well recognized. In higher education sector this need is yet to be appreciated by educational planner. Given the importance assigned to initial training of teacher, elaborate arrangement for initial preparation of school teachers has been made across the country. It is sad that the pre-service teacher preparation in the country is not well organised in its setting as well as in its curriculum. While emphasizing the need to revamp the initial preparation of teachers, the Programme of Action (POA 1986) and the revised POA (1992) had also stressed that to meet the challenges of the twenty-first century, the quality of education will have to be enhanced which would only be possible through continuous professional development of working teacher at school and higher education levels. For school teachers, regular programmes of in-service training were mooted and for college and university teachers, programmers of initial orientation followed by a series of refresher courses were planned. At school level, organization of the professional development programmes for teachers is the responsibility of Institute of Advanced Studies in Education (IASE), Council for Teacher Education (CTE), State Council of Educational Research and Training (SCERT) and District Institutes of Education and Training (DIET) for different categories of teacher and teacher educators. At university level, this responsibility is being taken up by the specially created institutions called Academic Staff Colleges. But in both the cases, teachers professional development activities are confined to their attending these activities, get some number and completing a technical requirement of a particular number of in-service courses for further promotion in the ladder of their career. In both the cases, it is commonly observed that teachers are more concerned with their certification for having attended programmes than their academic enrichment and professional development. The fault, of course, does not entirely lie with the teachers, it is also the teachers professional development institutions and educational administrators who fail to motivate the teachers to change their approach and attitude towards their professional responsibilities. Ethics originated as the philosophical study, begun by Plato and Aristotle, of what constituted a good life. Under the tutelage of subsequent philosophers, the thought came about that a truly good life was a life lived virtuously. This line of though helped to establish a philosophical study of just and unjust behavior. This has taken root most especially in the professional field where the jobs of people have grant them a certain amount of authority. Professional Ethics If one is attempting to live a just, and therefore ethical, life, then it follows that their actions should be virtuous in their vocation as well as their personal life. This is the beginning of professional ethics. Professional ethics were established, and are constantly being developed, as a guiding set of principles that help dictate what constitutes good behavior of person in authority. Professional ethics, in short, are the means of which we judge authoritys validity. Professional Ethical Principles The following are the basic rules for ethical behavior: Not using authority to influence personal life or for monetary gain. Not using authority with malicious intent. Acting within the scope of positions authority only. Not influencing or advocating unethical conduct in others. Acting in good faith to fulfill the duty of the position of authority. Need of Professional Ethics To aware the teachers to do their duties and abiding by truth, hard work and honesty when they tend towards comforts, selfishness, laziness and money. To change the conduct and behavior of teachers in such a way behind which there must be social acceptance and approval. To act as a role model for students by behaving in ethical manner to one and all. To create, sustain and maintain a reciprocal relationship between school and society for ensuring harmonious development of the students as well as of society. To enable every teacher for becoming a real one in truest sense of the term by moulding his personality. To bring improvement in professional environment to make it more conducive, favourable and appropriate for effective working. For this the teacher have to follow the ethical codes of teaching profession. Professional Ethics The following are some professional ethics for teachers:- Loyalty Towards Duty Punctuality Dutifulness Respect for the profession Respect for the institution Respect and admiration for Co-Staff Strictness and straight forwardness Truthfulness Honesty Good Behavior Towards Students Use of Rights Motivational Attitude Studious / Good Learner Dressing Sense Positive Attitude Innovative Proper Use of Authority IN PARAGRAPH FORM Accountability Accountability is a concept of ethics and governance with several meanings. It is often used synonymously with such concepts as responsibility, answerability, Blameworthiness, Liability. As result the concept of Accountability of teachers has completely disappeared into cold bag not leaving behind even a faint clue. For the last three decades, all the committees and commissions appointed to suggest reforms in higher education had recommended the regular teachers performance evaluation and ensuring their accountability: In 1986, S.R. Sen Committee while recommending higher pay scales had added the need for code of (professional ethics) to be made a part of it. In 1986, National Policy of Education and also its programme of action (POA) had recommended for annual performance appraisal of teachers of education institutions to ensure their accountability. In Dec. 1988, the U.G.C. Issued a notification regarding Accountability in higher education for all the universities that self appraisal performance of the teacher is to be made mandatory as a requirement of Career Advancement Scheme (CAS) for award of new pay scales and be implemented with a year. Rastogi committee (1977) while emphasizing the need for account ability in teaching profession suggested self-appraisal by teacher, assessment by students in appropriate manner, periodic performance appraisal, work load and code of professional ethics should be taken in to consideration while ensuring accountability of the teachers. In 2008, UGCs latest pay review committee headed my professor G.K. Chadda recommended multiple parameters like regularity in classroom teaching, holding tutorials, availability to students for consultation, participating in faculty meetings, guiding and carrying our research and participating in other academic activities like seminar, workshop etc. should taken in to consideration while assessing a teachers academic accountability. Professional Accountability Professionalism in any sector is a result of the extent of accountability on the part of individuals. Teaching, being a profession, assumes that every teacher needs to be accountable towards his job. The following are the expected teacher behavior in the form of accountability:- Accountability towards students Teacher and students are the two main pillars of the teaching learning process. The progress and development of the learners can be possible only when the teacher is sincere, hard work, sympathetic. For achieving optimal learning of students, the teacher should be accountable and should take care of the students progress according to his ability. Accountability towards Society The most important role of teacher is to bring the students into educational fold, coordinate various activities of the society and motivate the weaker sections of the society to learn because he can develop confidence to link between the school and the society. Hence the teacher should be accountable towards the society, which is beyond the classroom teaching. Accountability towards Profession A teacher should think various ways and means to help the students to acquire the knowledge, to develop academic potential and to sharp their future through the process of teaching- learning. Professionally accountable teachers adopt various methods and techniques of teaching follow the code of conduct, set the examples for others apply new ideas in classroom situations. Thus a teacher can achieve profession enrichment and excellence which which is beneficial for national development. Accountability towards lifelong teaching and learning A teacher should devote his whole life to teaching as well as learning for the future of humanity as his role is multidimensional and multifarious. Conclusion A professionally accountable teacher must be excellent not only in the subject to be taught, but also understand the learning requirements of the students. He should be caring, affectionate and sympathetic towards them for their harmonious development and prosperity of nation. Hence it is essential that a teacher must be accountable towards his students, society, profession, teaching- learning process, knowledge and values. Hence, quality education is possible when a teacher has the ethics and accountability towards his profession.

Monday, August 19, 2019

australias wage determination system Essay -- essays research papers

Australia has gone from a highly centralized wage determination system to a mainly decentralized one. There has been a move away from accords and awards to enterprise bargaining, through the 96 Workplace Relations Act. Recent policies include changes to unfair dismissal claims and the 2005 workplace reforms package. Throughout the 20th century, Australia has maintained a system of tribunals to make decisions about wage and non wage outcomes and to help resolve industrial disputes. Institutional forces affect the operation of the free market in order to improve labour market outcomes, such as guaranteeing minimum wages and conditions. The four institutional forces that affect labour markets are Governments, Trade Unions, Employer associations and Industrial Relations tribunal. Trade unions represent groups of workers on a collective basis. The most important trade union is the Australian Council of Trade Unions (ACTU), which is the peak union body to which most unions are affiliated. Trade unions membership has declined substantially from the 1970à ¢Ã¢â€š ¬Ã¢â€ž ¢s with an average membership of 55% to just 23% in 2003. This is caused by the increase in casual and part time employment, growth in industries with low union membership such as retail and the decentralization of wage determination. Employer associations represent business groups in similar industries in industrial relations matters. They seek wage moderation to maintain profitability. The head employer association is the Australian Chamber of Commerce and Industry. At the federal level is the independently run Australian Industrial Relations Commission (AIRC). They establish and maintain the fair minimum rates of pay and conditions (award safety net system) for all workers. Award wage increases are determined by the AIRC annually after hearing submissions from the government, ACTU and unions. They apply the no disadvantage test to CAà ¢Ã¢â€š ¬Ã¢â€ž ¢s and AWAà ¢Ã¢â€š ¬Ã¢â€ž ¢s to make sure workers are better off than the underpinning award. They also help settle industrial disputes through conciliation and arbitration. Move Away from centralized The Accords (1983-1995), were a social contract negotiated between the Federal Government and ACTU on minimum wages and specified working conditions for a number of occupations under Federal awards. This centralised wage system reduced the levels of inflation, industrial disputation and un... ...ver the wage determination role of the Australian Industrial Relations Commission (AIRC). It is meant to boost productivity by increasing workplace flexibility and placing new constraints on unions. The change is aimed at having workers covered by individual employment agreements rather than collective awards. Its creation is a big win for employer groups, who have campaigned for decades to strip back the powers of the industrial relations umpire to determine workplace arrangements. However, many believe it will lead to a reduction in pay and conditions. New legislation will also strip back minimum employment conditions. The current 20 "allowable matters" will be cut to about 16. The wage determination system has moved from centralised determination through National Wage Cases towardst an enterprise bargaining framework. Safety nets are there mainly for low paid workers who are unable to secure wage increases under enterprise bargaining. There has been sustained moderate wage increases, low inflation, strong productivity growth and employment growth. This system appears to generate the best of both enterprise agreements and centralised wage determination.

Sunday, August 18, 2019

Coke Business Study :: essays research papers

Business Summary Coca Cola is the world's largest producer of soft drink concentrates and syrups, as well as the worlds's largest producer ofjuice and juice-drink products, The company holds a 45% interest in Coca Cola Enterprises, its largest bottler. The Beverages division primarily manufactures soft drink and non-carbonated beverages and syrups, which are sold to independent and company-owned bottling and canning operations, as well as, fountain wholesalers. Brands include Coca-Cola classic ( best selling soft drink in the world), Caffeine free Coca-Cola Classic, Diet Coke ( sold as Coke light in foreign markets), Cherry Coke, diet Cherry Coke, Fanta, Sprite, diet Sprite, Barq's, Mr. PIBB, Mello Yello, Tab, Fresca, Power Aide, Minute Maid, Fruitopia and other products developed for specific markets, including Georgia ready to drink coffees. The Foods division is the world's largest maker and distributor ofjuice and juice-drink products. Brands include Minute Maid, Five Alive, Bright & Early, Hi-C And Bacardi. History Coke was invented in 1886, by Atlanta pharmacist John S. Pemberton, It was named by Frank- Robinson (Pemberton's bookkeeper), after it's two main ingredients, coca leaves and Kola nuts, In 1891 the company was sold to druggist Asa Candler for $2.300, and by 1895 the soda fountain drink was available in all US states, and expanded to Candia and Mexico by 1898, Candier sold most of the US bottling rights in 1899 to Benjamin Thomas and John Whitehead of Chattanooga for $1.00. With the backing of John Lupton, Thomas and Whitehead developed a regional franchise bottling system, expanding to over 1,000 bottlers within 20 years. The bottlers used the contoured bottle designed by the C.J. Root Glass Company in 1916, In 1916 Candler retired to become Atianta's mayor; his family sold the company to Atlanta banker Ernest Woodruff for $25 million in 1919, that same year Coca-Cola went public. In 1923 Wooddruff appointed his son Robert president. Robert continued as chairman until 1942 and remained influential until his death in 1985 at the age of 95- Robert Woodruffs contribution were in adverting and overseas expansion. During NnrWIl Woodrtiff decreed that every soldier would have access to a 5-cent bottle of Coke. With government assistance Coca-Cola built 64 overseas bottling plants during WKVII. Also during this period the company accepted "Coke" as an official brand name. In 1960 Coca-Cola brought Ntinute Maid and introduced Sprite in 1961, Tab in 1963 and Diet Coke in 1882. In 1981 Woodruff was succeeded by Roberto Goizueta, a Yale educated chemical engineer, who rose through the ranks.

Free Essay on Romanticism and Intuition in Hawthornes The Scarlet Letter :: free essay writer

The Scarlet Letter: Romanticism and Intuition During the romanticism period, Nathaniel Hawthorne wrote the novel, The Scarlet Letter, which used the romanticist idea of deep intuition and inner feelings, allowing the characters to have insight of the plots and secrets hidden in the strict Puritan community that they lived in. Throughout the novel many of the characters have this intuition, making the book more alluring to readers when trying to figure out what each character really knows. At the beginning of the novel, we are shown Pearl's natural child-like instincts for the Preacher, who is actually her father. When Pearl was first a baby, Hester and she were shamed on the scaffold while Reverend Dimmesdale, her father, preached to the awed crowd of the deep sin committed by Hester. Pearl reached out for him, "and held up its little arms," (pg. 68) as if reaching for her father. In another instance, they were all discussing Pearl at the Governor’s house and Pearl, totally out of her independent character, went over to Dimmesdale and "taking his hand in the grasp of both her own, laid her cheek against it." (pg. 118) That was really unlike Pearl, who was a "wild and flighty little elf," (pg. 118) that didn't display affection like that. Both of these bonding experiences occurred while she was younger and neither time caused speculation by the townspeople in general.. Not only Pearl, but Mr. Chillingworth, Hester's husband, had the intuition of knowing, rather sensing that Dimmesdale was the father. It was never told to him by anyone, or even speculated that the preacher was the sinner, but he could sense it anyway and knew he had to become close to Dimmesdale to figure him out. He also knew, not as a doctor, but as an evil man, that when Mr. Dimmesdale grabbed at his chest it was caused by something greater than an illness, it was caused by something Chillingworth knew how to provoke. The most amazing of his intuitions, would be at the end of the novel when he was already aware of Hester and Dimmesdale's plans to leave with Pearl on a ship to England. The mariner first informed Hester of his plans when explaining to her "that this physician here- Chillingworth, he calls himself- is minded to try my [the mariner's] cabin-fare with you [Hester].

Saturday, August 17, 2019

Six Steps to Learning How to Overcome Challenges in Your Life

There are six steps to learning how to overcome challenges in your life. Each of these steps identifying the challenge or problem, defining the challenge or problem, analyzing the cause of the challenge or problem, exploring solutions to the challenge or problem, deciding to solve the challenge or problem, and taking action to overcome the challenge or problem will require your total involvement (Pokras, 1989). While no one is an expert on your particular challenge, there are strategies that can be used as tools to help you overcome these challenges. The first tool involves identifying the challenge. Successfully overcoming challenges require knowing exactly what the challenge involves. Many times when we first encounter a challenge we feel threatened and react defensively before knowing what we are up against. When we step back from the problem or challenge and take time to examine it we find the problem has other contributing factors that were not clearly in focus in the outset. During this phase take time to collect data about your problem or challenge such as when it began, what were the symptoms that a problem existed, and how long has this been going on (Pokras, 1989). Upon identifying the factors or underlying causes of the problem you can then move onto step two defining the challenge. In this step it is a good idea to write down the possible causes for the challenge that you are now facing. This will require analyzing the data you have collected, thinking about what this data means, deciding what it is you want and what you do not want, and narrowing down the challenge or problem to single points of causation (Pokras, 1989). Once you have narrowed the scope of the challenge or problem down to a manageable level you are now ready for step three-analyzing the cause of the problem. Really what takes place in step three is taking the time to analyze actions that were taken that resulted in there being a challenge or problem that you are now facing. This is can be accomplished by doing some type of cause and effect diagram that will give you the ability to visually comprehend what happened. Usually when we can clearly see where we went wrong we have that aha moment. Now that you have identified, defined, and analyzed the challenge or problem, what do you do now? Here is where the real work begins because many people can tell you what their problem is but they have a hard time doing something to change their situation. Step four requires you to make a decision to do something by exploring possible solutions to the challenge. Niven (2005) suggest developing a strategy or plan that allows you to decide what you need to change to overcome the challenge or the problem. This step is an important step because it takes a desire to succeed to overcome the challenge or problem and no one can instill in you the desire to change. This desire must come from within but will not happen until you make up in your mind what you want out of life, how you want your life to be, what you need to survive, and what it is you need to change to overcome your challenge or problem. Making the decision that you must change and that you have the power to make that change is difficult but can be the most rewarding thing you can do. In step five you will discover that after the decision is made that you want to change you can now actually decide to solve your problem. This step will require deciding on your criteria for success, deciding what your goals will be, establishing priorities, defining objectives, and taking responsibility for improving your own life (Cohen, Jacobs, Quintessenza, Chai, and Ungerleider, 2007). The most important tool in this step is writing an action plan including the aforementioned elements along with your vision for your life, your mission in life, and your personal philosophy or strategy for living your life (Niven, 2005). This plan must be written in a manner that allows you to measure your progress toward overcoming your challenge or problem. Part of your plan, for example, may involve getting a mentor, a person to serve as a role model, or setting up a support system (Cohen et al, 2007) by a certain date to fully implement your plan. Once you have established your plan you are ready to move onto the final step. The last step to overcoming challenges involves taking action . Implementation of your action plan will be the most critical part of you being successful in overcoming your challenge. This will require your total commitment, dedication, involvement and perseverance to achieve success. You ust remember that the best laid plans will not solve your problems if you do not do something to put them into motion, prepare yourself to deal with the unexpected, and be ready to make the little changes necessary to your plan to reach your goals. If you carry out the six steps of identifying the challenge or problem, defining the problem, analyzing the cause of the problem, exploring solutions to the problem, deciding to solve the problem, and taking action to overcome the problem (Pokras, 1989) you will begin to make progress to overcoming your challenges.

Friday, August 16, 2019

The life history anthropological perspective

An interview I had with my brother turned out to be very unusual that is to my surprise it was, for me, a new revelation of his inner self. The whole session became personal and sensitive. I came to know a new person, whom I did not know earlier, in him. That is about his condition and experiences of having muscular dystrophy. His perils and his optimistic views, in spite of struggling with the disabilities. It was astonishing to learn that after my thoughts of how I know him so well because he is my brother, there are still a lot of things that I do not know about him. This interview has definitely introduced me to a new person in my brother. The life history anthropological perspective At the age of 6, he was diagnosed with muscular dystrophy. The diagnosing of this situation in him was a hard one for mother to accept. She had always kept this factor to her heart and made sure he never even feel that he was sick. She tried and the rhythm of his routine was as normal as anyone else of the same age. At the same time the frustration of not being able to do whatever he wanted made him angry at everything in the beginning. He slowly began to realize that he could still have nice feelings. And that is where he could still try to do everything what the other kids did. The dramatic end they had was often embarrassing but he found them to be great fun. This concept of having fun in the awesome and dramatic eventualities of an other ways routine for a kid of his age seems to me as the first step of his finding the life meaning full. The perils of his condition took deeply toll of him. Its true that I have seen most of him in my life, this interview gave me a new perspective of him. The high school, like any other kid, was interesting to him. The presence of his brother was a solace. Brother had to live two years earlier than he did. That was the time he felt bad about the saying â€Å"Oh, yet defend me, friends; I am but hurt†. (Alexander, p 1071) He even thought at the end of his high school that the high school was waste of time. I have a strong feeling that the lack of friends, after having to sit with older kids when his brother was there, made him lonelier than one could ever feel. A pretty librarian’s company was too limited an entertainment for boy of that age. His mindset, by the time he left the high school, might have greatly been influenced by the fact that he was a disabled, unlike other kids. It can be termed as the greatest disaster that happened in his life with the unhealthy Physical condition he suffered from. Having met death face to face with pneumonia at the age of 23, he realizes the need of living life to the fullest. However this realization seems to be the positive out put completely derived from the life threatening situations he went through. I would say it was a therapeutic experience for the both of us because somehow after that interview, he felt good having to share all his thoughts and feelings to someone who he can trust and depend on. In addition, for me I felt as if something good and special came out of it – within my self as a person and between the both of us and our relationship as family. From the first question alone, I was really dazed that he was willing to open up like that with regards to his diagnosis and learning from the doctors that he would not be able to live to see his twentieth year. His courage and strength really shows up by how he handles and is still handling his condition. His openness to me, freely sharing the inner most feelings of his struggles, was really to be considered as an advantage to me because we had an intimacy of being the same family. My brother was open to the entire experience. It was not difficult to convince him to go through with a personal interview with me. He actually enjoyed it because he knew he was helping me out and he really liked the idea of reflecting on past events and experiences that he had in his life. He prides me with joy knowing that he is not the kind of person who gives up. He was able to defeat his worries and fears and still made great efforts to do what most children did at his age from very early in his life. The interview has greatly changed our relationship as siblings. First, we know we have gotten closer because now I feel like I have evaded the person in him that I did not know all these years. My brother has opened up as new person himself. The moral of the  Story is that it has developed in me a sense of self-acceptance. The conversation with him has taught me to accept and take things as they come.   Brushing aside all the limitations, he has the confidence to tell me that that there are a lot of things to do and that he wanted to live his life to the fullest makes me look at myself and rethink what my problems are and what my mindset was. The world we live in has a lot more problems for its people. A lot of people complain about things, just like the poor boy complaining that ‘I have no shoes, I have no shoes.’ Until, he saw a man with no legs. If we as normal people complain about our lives and not having to succeed in situations where we want to accomplish many tasks, I guess we should think about those who unwillingly have disabilities, such as muscular dystrophy. My brother’s out look towards life was one of great self-esteem and acceptance but the conversation gave me great cultural insight as compassionate side, in me sparked off like a matchstick. Everything that he said I took note off and from them I draw my inspiration in reinventing my life, and am compassionate in my society. I took note of his words as he said you’d never be able to make anyone else happy if you can’t look at yourself in the mirror and be happy at what you see. Reference Alexander, Peter (1985) A book on complete works of Shakespeare. English language book society.