Love and Friends

When he cares for someone, he shows it and oneself, h?s not a shy type of person and maybe just a little bit lazy think. He looks like a vampire because he hates going out in the morning because as what I've said, he's too conscious with his skin's color. He hates cheese but he likes chocolate a lot. He looks so cute when his sleeping he looks like a little child. Unlike the other boys, he's not fun of playing basketball and other ball games think. This someone is not just like an ordinary someone for me.Someone will remain someone, no name will be mention. Not all someone means unknown. Persuasive essay: Have Many Friends gut Are They All Real All of us have a friend, that's normal. But do you think if you have many friends, all of them are true friends? No, no, no. You what more friends, for what? Having many friends is not the basis Of having a real one. Friends are those person whose there during the time that you really need someone to talk to and someone to be with, not that pe rson who are just there when they need something from you. , you, us, we don't need many friends when in fact, all of them are just fake and can bring us in trouble. Just look for the person who you think really deserves to be your friend. The person who you think it is and the person can really trust. Being friendly is actually nice. But actually you don't need all of them. At least having some people in your life is enough. Don't ask for more, just be contented with the friends you have because you just don't know they are the real one. Not all the time that the merrier is better.Narrative Essay: The Family Have The people who will always be there for you, who will acceptor whatever and whoever you are. Who will think of things for your own good and make you safe, not the things that can harm you. The best gift you receive from God, the only one who will be there when you feel nothing. Family, the one hose there during the hard, sad and happy times in our life. Where we first lear n how to love, how to care, and treasure important things we have, and where we first experience the feeling of being love.Like other people, I have my own family which is composed of my mother, sister and of course me. You've noticed there's no father right? Yeah, all of us have father but not all of us experience of being love of a father and I'm one of that. Yes, I have father but never feel his presence even hi so I conclude 3 members of a family Is enough. I already feel contented even without a father. My mother raises me and my sister alone. I saw how my mother did her best just to provide our needs, just to make us live. Appreciate everything that my mother did.She's the best mom lye ever wish for, just like my sister. My sister is just like me, a disobedient but a loving child. Maybe that why we're really close. But despite of that she is a very good sister and she's the best. She cares for me that much. I can say it's really nice to be the youngest daughter and sister. I'm very honor to have them as my family. To have my mother as my teacher as the same time my adviser and my sister as my best friend. Having a family like them, you won't wish for anything else. I just wish, May God blessed me and my family and guide us.Expository Essay: Influence High school graduating students will soon be studying in college. Do you know that almost 50% to 70% of the graduates will choose their course with the influence of their friends than their family? Graduating students will choose their course for their college. But observations say that friends give greatest influence to students on what they will choose. Parents have less influence to their children because they want their children to choose on their own. Influence can either be good or bad. It depends upon the people who will believe.

Unjust Persecution as a Major Theme in to Kill a Mockingbird

To Kill A Mockingbird by Harper Lee is a novel takes place over the course of three years in which Scout Finch learns about life as she grows older. Throughout the book, many themes are revealed. One of the most obvious reccurring themes is the unjust persecution of the innocent. This theme is expressed through the victimization of guiltless characters such as Tom Robinson, Boo Radley, and even the mockingbirds. Tom Robinson is an African American man living in the south in the 1930's, a time when blacks were treated very poorly by the white population.Tom was accused of raping Mayella Ewell, a white nineteen year old girl. Although there was no evidence against Tom and it was clear that he did not commit the crime, the jury found him guilty of rape. Tom was unjustly persecuted because it was popular belief during that time that all African Americans were liars. Tom Robinson's conviction expresses the theme of the persecution of the innocent in the sense that he was imprisoned for a crime he did not commit solely because of the color of his skin.Boo Radley is another character who was victimized because of something he could not control. Boo Radley was emotionally damaged by his harsh father as a young boy and was forced to live as a recluse, never coming out of his house. Boo most likely suffered from a social or mental disorder that made him appear unfriendly and standoffish. Most of the townspeople in Maycomb knew very little about Boo but assumed and made up things about him. People said he went out at night when the moon was down, and peeped in windows†¦ Any stealthy small crimes committed in Maycomb were his work†¦ A baseball hit into the Radley yard was a lost ball and no questions asked† (Lee 9). Although the townspeople did not know Boo personally, his necessary reclusiveness gave him the reputation of a menacing sociopath who committed crimes. When Scout and Jem met and got to know Boo Radley, they learned that the reputation was a fal se one and Boo Radley was a victim of the persecution of the innocent.Finally, the motif of the mockingbird also represents the unjust persecution of the innocent. When Scout and Jem received rifles for Christmas, Atticus explained to them that they were free to shoot all the blue jays they wanted, but it was a sin to kill a mockingbird. Calpurnia explained further, â€Å"Mockingbirds don't do one thing but make music for us to enjoy†¦ they don't do one thing but sing their hearts out for us. That's why it's a sin to kill a mockingbird† (Lee 103). Calpurnia's explanation emphasized the immorality of persecuting someone or something that is innocent and is not capable of defending itself.The allusion to the title symbolized the unjust persecution of Boo Radley and Tom Robinson, who were both innocent and unable to defend themselves. Throughout To Kill A Mockingbird, the theme of the unjust persecution of the innocent is shown through multiple characters. The theme is exhi bited in Tom Robinson's conviction, Boo Radley's inaccurate reputation, and the immorality of killing a mockingbird. Through this theme, the novel teaches its readers of the injustice of victimizing those who are blameless.

Poverty in Appalachia Essay

The people of the Appalachian Mountains have been impoverished for years. They are all settling for a lot less then they should be. Most people in the mountains see that their parents did not graduate from high school so they feel that they don’t need to. They see their families struggling with paying bills so they feel like they should not finish school and help out by getting a low paying job and settling with working at Burger King or Walmart. They lack motivation to strive for excellence and overcome the obstacles of living in the mountains and maybe someday moving out. One of the major problems of the majority of the people who reside in the mountains is drug addiction. Families are broken up by drug addictions. It is an epidemic throughout the mountain. There are more drug busts in the mountain then in any major city such as Los Angeles or New York. This is another reason that people are very poor; they spend all their money on drugs and not enough for the bills, food, or water. One main job that a lot of people have in the mountains is working in the coalmines. Working in the coalmines pays a starting salary of $60,000, but is very dangerous. Coalmining can destroy your lungs and if there is an accident in the mines, you can be stuck down there for days at a time. In the Appalachian Mountains, they have about 100 open jobs for coalminers. The only problem is that either nobody wants to work in the mines, or they cannot pass the required drug test to get the job. The Appalachian Mountains is a place where there is much poverty and hardship. It is a town where many people do not finish high school and there is an excessive drug problem. Although it is a place of all these hardships, it is also a place where families stick together and help each other out when times get rough.

Rewrite the essay Example | Topics and Well Written Essays - 750 words

Rewrite the - Essay Example Huxley wrote a fictions piece of satire devoid of prophecies on science. Brave New world is a sinister, unsetting, and loveless place, endowed with features aimed at estranging the audience. The novel illustrates the feeling that disturbs the readers mind with a description of a vanquished society. (Huxley 2). These books have quite similar themes. One major theme presented is the loss of sovereignty. Various events and experiences of the characters in these books point to their loss of sovereignty. Characters in the books are stripped of the rights to make their own independent decisions. Different forces in the society have robbed the characters their freedom of choosing how to lead, plan, and live their lives. The people are however are not aware that some of the things they cling to, which are dear to them, are the same things, which rob them of their sovereignty. Therefore, the loss of sovereignty in these books is mostly experienced unconsciously, even though it has negative influence on the characters. Being a representation of the real world, the authors of these books try to show us the different ways in which we have lost our sovereignty in society. In Huxley’s novel loss of sovereignty emerges when science and technology is used in society to lead to totalitarianism. For instance, the state uses powerful technology to control people’s reproduction. People lose their sovereignty, as they cannot make independent decisions on their reproduction. Consumerism is another loss of sovereignty of people to the state and corporations. Due to people’s quest for happiness, there is manufacture of High-Tec entertainment mediums and increased consumption of these. Therefore, manufacturers, states, and corporations decide what products they will produce for the people. This way, the people lack power to decide what they want, hence loss of their sovereignty. Huxel also warns against an overly

The No Child Left Behind Act of 2001 (NCLB) Essay

The No Child Left Behind Act of 2001 (NCLB) - Essay Example Student achievement in the most fundamental academic skills continued to decline, especially in low-income school districts. Therefore, the ESEA was designed to serve as a funding source for elementary and secondary education in the United States was designed to provide funding for better educational resources, allocate funding for public schools with a need for additional financial support and provide government-sponsored grants that would enhance the quality of state departments of education. Over the decades since the inception of ESEA, it was determined that revision of the ESEA was required to meet the needs of contemporary students in America. This need led to the implementation of the Improving America’s Schools Act of 1994 in the Clinton administration and the No Child Left Behind Act (NCLB) of 2001 which both enhanced the Elementary and Secondary Education Act to make educational reform more relevant for modern academic needs. However, there is still a need for further educational reform that surpasses the relevancy of the NCLB as there are measurable deficiencies related to this Act. This essay explores the issues associated with NCLB which mandate further revisions to this Act in order to fully address the problems in today’s public school districts. The No Child Left Behind Act of 2001, whilst a valuable piece of legislation to ensure higher quality of education, fails to address certain issues in today’s society. This revision to the ESEA does not properly address the goal of promoting bilingualism. In many of today’s public schools, there is a measurable shortage of educators with the proficiency and training to provide bilingual learning for children in elementary and secondary schools. It is estimated that there are nearly 5.1 million students in need of English-as-a-second-language instruction throughout the United States (Cuellar, De la Colina and Battle, 2007). With growth in migrant children now enrolled in public schools

Godly Purpose Essay Example | Topics and Well Written Essays - 1000 words

Godly Purpose - Essay Example As creatures created in God’s image, humans have a unique opportunity to fulfill divine purpose in their lives. Some never move beyond self-gratification and seek only to achieve worldly success measured by cultural conceptions. God created all humans in his image. This applies whether a person chooses to believe in God or not. God created humans to have a capacity for a relationship with him, to be able to think and feel affection and emotion, and with the ability to think, understand, and determine morality. From the very beginning, God’s plan included humans, with a desire to create a being that could relate to him. He said, â€Å"Let us make mankind in our image, in our likeness,† indicating a purpose to his decisions that mankind â€Å"may rule over the fish in the sea and the birds in the sky, over the livestock and all the wild animals, and over all the creatures that move along the ground† (New International Version, Genesis 1.26). One may never re alize the divine opportunity that humanity offers. Instead of embracing a life that honors God and fulfills his divine purpose, one may choose to accept a lifestyle that relies on cultural conceptions such as economics, social constructs, survival, sexuality, and self-gratification. ... not be even a hint of sexual immorality, or of any kind of impurity, or of greed, because these are improper for God’s holy people.  Nor should there be obscenity, foolish talk or coarse joking, which are out of place, but rather thanksgiving† (Eph 3.3-4). In addition to identifying activity and behaviors to avoid, God also provides a guide of what he expects if one is to live in a way that mirrors his image. Through the words of Paul, he communicates, â€Å"I urge you to live a life worthy of the calling you have received.  Be completely humble and gentle; be patient, bearing with one another in love.  Make every effort to keep the unity of the Spirit through the bond of peace† (Eph 4.1-3). In Romans, one is encouraged to â€Å"not conform to the pattern of this world, but be transformed by the renewing of your mind† (Rom 12.2). Throughout the Bible, God provides one with instruction and encouragement. Promises temper what may appear to be a daunting task to one encumbered by the intrinsic weaknesses and frailty of humankind. Paul communicates one such promise in a letter to the church at Corinthians, saying, â€Å"And we all, who with unveiled faces contemplate  the Lord’s glory, are being transformed into his image with ever-increasing glory, which comes from the Lord, who is the Spirit† (2 Cor 3.18). These promises provide one with hope, even when individual choices and actions make adhering to God’s design a challenge. The promises indicate that God understands and accepts the imperfections of humans as long as they are working toward his will. One must set an example for others to follow. The Bible uses the analogy of light to demonstrate how one can do this. Paul states, â€Å"For you were once darkness, but now you are light in the Lord. Live as children of

HATE CRIME Essay Example | Topics and Well Written Essays - 1500 words

HATE CRIME - Essay Example According to Dr. Jack McDevitt, hate crimes are â€Å"message crimes,† which tell the victim and the minority group to which he belongs, that they are not welcome in that society (cited in APA Position paper, 1998). As such, hate crimes have the potential to alienate whole sections of society and lead to fragmentation. In the face of such clear-cut danger to society, it is imperative that unambiguous, punitive legislation against hate crimes needs to be enacted and put into execution at the earliest. The entry of the term ‘hate crimes’ into common vocabulary can be traced to the Justice Departments’ ‘hate crime statistics’ in 1985 (Jacobs and Potter, cited in Siasoco, 1999). The official definition of a hate crime or a bias crime is â€Å"a criminal offense committed against a person, property or society which is motivated, in whole or in part, by the offenders’ bias against a race, religion, disability, sexual orientation or ethnicity/national origin† (Robinson, 2003). The perpetrators of hate crimes are generally young adults and strangers to the victims. While some of them may be members of hate groups such as the Ku Klux Klan, the vast majority are otherwise law-abiding individuals, whose personal biases stem from the social norms governing their environment. They often feel that they are morally justified and supported by society in their attacks on people perceived to be ‘different.’ The leading basis of hate crimes continues to be racism, with African-Americans bearing the brunt of the attacks, a particularly heinous case being the dragging to death of James Byrd in Texas in June 1998. Ethnic minorities are targeted because of their different lifestyles and their success being perceived as a threat to the employment and financial opportunities of the ‘natives.’ David Ritcheson, a Latino, was sodomized and savagely

How does the relative distance traveled by food products impact the Research Paper

How does the relative distance traveled by food products impact the price of those food products - Research Paper Example The research includes related literature. David Kault stated: â€Å"When it is not feasible to measure all the individuals in which we are interested, we measure a selection of them. Usually the selection is a small or infinitesimal fraction of the number of individuals in which we are interested. In the case of women's heights, we would measure a small selection of women. The statistical term used here is that we take a ‘sample’ from the population†. Patrick Westhoff emphasized the cost of transportation is one important factor affecting food prices of competing products. For example, soybeans that are harvested in Illinois are priced lower than imported European soybeans because it is cheaper to ship the soybeans through the Mississippi river compared to shipping the soybeans through the wide expanse of the Atlantic Ocean. From 2004 to 2006, soybeans were sold at an average of $202 per metric ton in the markets central Illinois. On the other hand, the soybeans t hat were imported from Netherlands were sold at the higher $261 per metric ton in Illinois. The difference in the food price per metric ton is due to the increase in the transportation fuel prices. In addition, Moshe Milevsky reiterated fuel costs directly affect the prices of food products. In high income nations, including the United States, the consumer’s average food money is allocated for the reimbursement of the store’s expenses.... The three competing food stores are Wal-Mart food store, Netgrocer food store, and Netfoodex.Com food store. Research assignment The research includes related literature. David Kault (Kault, 2003) stated: â€Å"When it is not feasible to measure all the individuals in which we are interested, we measure a selection of them. Usually the selection is a small or infinitesimal fraction of the number of individuals in which we are interested. In the case of women's heights, we would measure a small selection of women. The statistical term used here is that we take a ‘sample’ from the population†. Patrick Westhoff (Westhoff, 2010) emphasized the cost of transportation is one important factor affecting food prices of competing products. For example, soybeans that are harvested in Illinois are priced lower than imported European soybeans because it is cheaper to ship the soybeans through the Mississippi river compared to shipping the soybeans through the wide expanse of t he Atlantic Ocean. From 2004 to 2006, soybeans were sold at an average of $202 per metric ton in the markets central Illinois. On the other hand, the soybeans that were imported from Netherlands were sold at the higher $261 per metric ton in Illinois. The difference in the food price per metric ton is due to the increase in the transportation fuel prices. In addition, Moshe Milevsky (2010) reiterated fuel costs directly affect the prices of food products. In high income nations, including the United States, the consumer’s average food money is allocated for the reimbursement of the store’s expenses. The expenses include the cost of transporting the goods from the farm to the entity’s store

Extended Essay in German.Generationenkonflikt in der Literatur

Extended in German.Generationenkonflikt in der Literatur - Essay Example Als Beispiel sei hier nur kurz der Konflikt Kà ¶nig Davids und seines Thronfolgers Absalom erwà ¤hnt, der in dem Verrat Absaloms und dessen Tod gipfelt. Die Sympathien liegen bei dem Vater, der den Tod seines Sohnes zwar tief betrauert aber den Kampf gegen den Sohn als unvermeidlich und gerechtfertigt ansah. Dies ist nur ein Beispiel in dem die Nachfolge des Sohnes von seinem Vater verwehrt wird – es stellt eine Extremsituation dar, die dem natà ¼rlichen Prinzip der Erbfolge und des Generationenwechsels zu widersprechen scheint, und den Sieg des alternden Tyrannen gegenà ¼ber der jà ¼ngeren Generation schildert. Fà ¼r ein moderneres Beispiel denke man an den Konflikt zwischen dem tyrannischen Kà ¶nig Friedrich Wilhelm I. von Preußen und seinem à ¤ltesten Sohn Friedrich, spà ¤ter "der Große" genannt. Der streng-verstà ¤ndislose Vater trieb den jungen Friedrich dazu, im Jahre 1730 einen Fluchtversuch mit Hilfe seines Adjutanten, Leutnant von Katte, zu unternehmen. Dies kam nach damaliger Ansicht einem Verrat gleich, und der junge Kronprinz wurde von seinem Vater gezwungen der Hinrichtung von Kattes zuzusehen. Er selbt entkam nur knapp dem gleichen Schicksal. Eine andere Konfliktsituation ergibt sich, wenn der Vater die Nachfolge seines Sohnes aktiv fà ¶rdern will, aber den Sohn nach seinem eigenen Charakter zu formen gedenkt, und die Neigungen und Vorstellungen der Lebensgestaltung seines Sohnes entweder aktiv unterdrà ¼ckt oder auch nur nicht zu erkennen vermag. Der Vater wird hier oft als mitten im Leben stehend geschildert, er ist zweifellos eine Respekt und Furcht einflà ¶ssende Figur gegen die der sich als unterlegen und schwach empfindende Sohn nicht anzugehen vermag. Diese Entwicklung in der Literatur begann im spà ¤ten 18. Jahrhundert – eine typische Konstellation ist der empfindsame, kà ¼nstlerisch begabte und sensible Sohn der sich einer nà ¼chternen und strengen Vaterfigur nicht gewachsen

Barbie Doll by Marge Piercy Essay Example for Free

Barbie Doll by Marge Piercy Essay The poem, Barbie Doll, is about a girl who was growing up in a society which regard highly of female beauty. The title illustrates that most females were expected to be like Barbie dolls. These dolls cast pressure on the girl to be like supermodel. In this story, the girl failed to meet the standards of society and viewed as a social outcast.The first paragraph describes a growing girl who was presented with dolls, miniature GE stoves, irons and lipsticks. This will ensure that the girl will know which gender roles she should be and not too deviate from the accepted social custom. The mood of the poem changes when the author describes, the magic of puberty. Here, it refers to a time of emotional crisis that the girl went through as she matures. She is constantly teased for not looking like the typical Barbie dolls. The second paragraph began with mentioning the girls positive aspects, such as She was healthy, tested intelligent, possesses strong arms and back and abundant sexual drive and manual dexterity, These sentences portray the girl image (female) to male characteristics. The tome in the poem changes again when the author stated, the girl went to and fro apologizing, and everyone still say she had a fat nose and thick legs, the society again, scorn at the ugly appearance of the girl. In the third paragraph, line twelve to sixteen, the girl is expected to fake her natural behavior, emotion and characteristics. The fan belt was used to exemplify that one cannot endure the pressure placed by society to meet their standards and will wear out eventually. Consequently, she cut off her nose and legs. Therefore, the last paragraph expressed her death as consummation at last. Dont she look pretty? Everyone said. In this line, the author wants the reader to make good judgment to the senseless situation in which society judge beauty to female. I think that children, especially boys, are not born with hatred or feelings of enmity towards female who have physical figures below social standards. They are all programmed that way by selfish or ignorant male adults. If these male adults can only take a look at themselves and see that all they have done is to destroy. The lives of their opposite sex, driving down their  self-esteem to the deepest pit, then this society will be a better place to live in.

Structure of the Balance Sheet of Islamic Banks

Structure of the Balance Sheet of Islamic Banks INTRODUCTION Structure of the Balance Sheet of Islamic Banks Liquidity is an important characteristic of banks. By their very nature, banks transform the term of their liabilities to have different maturities on the asset side of the balance sheet. At the same time, banks must be able to meet their commitments such as deposits at the point at which they become due. Thus, liquidity management lies at the heart of confidence in the banking operation. Customers place their deposits with a bank, confident they can withdraw the deposit when they wish. If the ability of the bank to pay out on demand is questioned, all its business may be lost overnight. The importance of liquidity transcends the individual institution, since a liquidity shortfall at a single institution may invoke systemic repercussion causing harm to the whole financial stability of a country. Therefore it is important for banks to have adequate liquidity potential when it can obtain sufficient funds promptly and at a reasonable cost. For Islamic banks, liquidity risk is a signific ant risk owing to the limited availability of Shariah-compatible money market instruments and Lender-Of-Last-Resort (LOLR) facilities. Hence, the recent introduction of commodity murabahah instrument based on tawarruq concept by Central Bank of Malaysia is deemed as an innovative approach to liquidity management. It certainly adds to the list of instruments for Islamic banks to manage their liquidity more effectively and efficiently. This paper reviews the structure and mechanism of commodity murabahah particularly for liquidity management purpose. As will be evident in this paper, this instrument has its own advantage which appeals to certain practitioners who were previously uncomfortable with `inah-based instruments (www.acrobatplanet.com). Liquidity management lies at the heart of confidence in the banking operation. Customers place their deposits with a bank, confident they can withdraw the deposit when they wish. If the ability of the bank to pay out on demand is questioned, all its business may be lost overnight. In general terms, liquidity refers broadly to the ability to trade instruments quickly at prices that are reasonable in light of the underlying demand/supply conditions through the depth, breadth and resilience of the market at the lowest possible execution cost (Pervez, 2000). A perfectly liquid asset is defined as one whose full present value can be realized, i.e. turned into purchasing power over goods and services, immediately (Tobin, 1987). Cash is perfectly liquid, and so for practical purposes are demand deposits, and other deposits transferable to third parties by cheque or wire, and investments in short term liquid government securities (Abdul-Rahman, 1999). The importance of liquidity transcends t he individual institution, since a liquidity shortfall at a single institution may invoke systemic repercussion causing harm to the whole financial stability of a country. Therefore it is important for banks to have adequate liquidity potential when it can obtain sufficient funds promptly and at a reasonable cost (Heffernan, 1996). The concern over liquidity management is also relevant to Islamic bank that holds illiquid assets while its liabilities are liquid, and holds assets unpredictable in value while guaranteeing the value of its liabilities. Thus, since Islamic banks follow the same structure and characteristics of a commercial banks balance sheet, they are not immune from liquidity risk. The potential mismatch between deposits and investment financing exposes Islamic banks to liquidity problems. On the other hand, if the banks maintain too much liquidity to avoid getting into the liquidity problems may in turn hurt its profitability, therefore creating a right balance between the two objectives of safety (www.acrobatplanet.com). Off-balance-sheet financing Also called synthetic leases, this is where a company uses rules from different systems, such as financial and tax, to account for an asset in different ways. For example, I lease a computer from company A. Because I dont own the computer (and I am assuming this is not a capital lease), I get to take the rent expense (for the lease) as a deduction on the books, but I dont have to account for the asset or the debt, therefore it is not on the balance sheet. This is attractive because it creates no debt on the companys books. It is often done through a SPE (Special Purpose Entity). Though lucrative, it has contributed to the demise of companies such as Enron. The lessor (company A) maintains the asset on their books and, if they financed it from another company (company B), the debt as well. Credit card issuers, mortgage companies and various other entities also use a type of off-balance-sheet financing known as asset backed securitization (ABS). The ABS process effectively allows a company to sell a portion of the loans (receivables assets) to investors, effectively removing the assets from their balance sheets (allowing a lower level of reserves, and, therefore capital) while managing the servicing of the debt (http://wiki.answers.com). AIMS AND OBJECTIVES OF THE STUDY To study the structure of the balance sheet of Islamic banks To study the On Balance Sheet Financing as compared to Off Balance financing. Critical appraisal of the structure of the Balance Sheet of Islamic Banks. BACKGROUND AND ANALYSIS Risk management and liquidity are of crucial importance in the overall banking environment, and they have clear relevance also to the specific environment of Islamic banking. In itself, Islamic banking is of growing significance. Regulators have their own particular perspective on these issues. As a regulator based in London the Financial Statement Analysis (FSA) should focus on the following: The importance of London as a centre of Islamic financing. The overall role of the FSA as a regulator why sound regulation is of critical importance in any financial marketplace, how it can assist in facilitating competition and innovation. Risk management issues in banking: a summary of the key elements involved. Risk management and liquidity issues as applied to Islamic banking. The perspective of the regulator, and why the UK operates a single regulatory framework for all firms. The importance of London as a centre of Islamic financing London is clearly one of the pre eminent centres of Islamic finance, for two main reasons. These are the presence of sizeable Muslim community in the UK; and the importance of London as a financial centre with the expertise to develop new and innovative products. The FSA as Regulator welcomes the development of Islamic finance, and would be happy to see this grow further. Other important centres include Bahrain and Malaysia (www.financeinislam.com). London plays a role in four areas of significance in Islamic banking: Trade assets such as murabaha, istisnaa, and bai-al-salam. The market is probably worth US$ 10 billion in the UK. Equipment leasing asset and partner selection, operating leases and finance leases Real estate where investors are looking for rental and capital benefits. Investment routes include fund management, club transactions, leverage funding, and asset analysis, corporate structuring and tax planning. Packaging and delivering assets engineering solutions. This includes a growing market in securitizations of pools of Shariah compliant assets. The role of the FSA as a regulator The Government has set the FSA four objectives: Market confidence Public awareness of the financial system Consumer protection Reducing financial crime The new FSMA will bring in eleven principles for the handling of business, which set out at a high level how we expect a firm and its management to conduct themselves. In terms of minimum criteria, the FSA has to be satisfied that institutions have adequate capital, adequate liquidity and adequate control over large exposures. Banks of what ever origin must be prudently run and that their management must be fit and proper for the task. Satisfactory risk management, a realistic business plan, and adequate systems and controls need to be clearly demonstrated. The FSA must be satisfied also that each institution is subject to effective consolidated supervision i.e., that one supervisory authority takes prime responsibility for supervising the bank or banking group as a whole (www.financeinislam.com). RISKS, PROBLEMS AND CHALLENGES Risk management issues in Islamic banking Senior management in any business must be able to provide effective risk management. The consequences of failure to do so are dire, for example, the collapse of Barings where proper controls and monitoring were not effectively in place: Regulators need to be sure that such risks are managed so as to prevent a worst case scenario such as the systemic collapse of a whole banking system. Critical issues for Islamic banks are the reputational risks and legal risks of non-compliance from Shariah board requirements and/or from engaging in any activities that were not perceived as properly Islamic by the marketplace. The maintenance of trust amongst Islamic market participants is crucial (www.financeinislam.com). Credit risk This is the risk that customers default and cannot service their debts. Banks can also suffer from the excessive concentration of exposures to particular customers, industries or countries. Asset quality should be closely monitored using appropriate management information and systems support. Islamic banks run an asset book, just as conventional banks do, so the same disciplines must apply. Liquidity risk Banks face collapse or severe trading difficulties when they are unable to meet their liabilities. For example, many Japanese institutions operating in London in the late l990s were hit when the Japanese premium increased their funding costs and eroded their liquidity. This did not mean, however, that they became unable to meet their liabilities. For the FSA, liquidity is a key concern. The dilemma for the Islamic sector is that liquidity from the Gulf is currently very substantial, but there is the need to seek out appropriate outlets for it. There is not a clearly defined lender of last resort for Islamic banks that might suffer liquidity problems, although support could probably be found from with in the overall pool of liquidity. Interest rate risk The risk of declines in earnings due to the movement of interest rates, most of the balance sheet items of banks generate revenues and costs that are indexed to interest rates. A key aspect of interest rate risk is also the possible mismatches that can arise between fixed and floating rates. In the Islamic banking context, interest rates per se are not a factor. However, commissions generated on Islamic transactions could also be vulnerable to market movements. Market risk The risk of adverse deviations of the mark-to-market value of the trading portfolio during the period required to liquidate the transactions. Islamic financial institutions take up risk sharing funds, whereas conventional banks take capital certain deposits where repayment must be made. There is the implicit requirement for both parties to a given transaction to share in the loss as well as the profit. Foreign exchange risk The currency risk of suffering losses due to changes in exchange rates. This principle applies equally to Islamic banks. Letter of credit and trade finance for example, a significant proportion of which is denominated in US Dollars, often pose an exchange risk. Currency transaction and translation Factors must be taken into account. Solvency risk The risk that financial institutions will be unable to hold sufficient capital resources to cover their different risks, regulators need to decide what amount is held, supervise, in order to maintain an appropriate level of solvency. Islamic banks need to be clear about the status of their deposits or liabilities. Any capital-certain transactions generate more solvency risk than risk-sharing with investors. Operational risk There is no precise definition, but we view operational risk as being the risk that arises from human error and/or deficiencies in information systems or controls, resulting in direct or indirect loss. In the Islamic banking context, operational risks can impact just as much as in conventional banking, with the additional element of possible operational defects causing failure to comply with the Shariah (www.financeinislam.com). FINDINGS Risk management and liquidity issues as applied to Islamic banking This is a very important area and a number of key regulatory issues are under review. For example, whether liquidity requirements should apply to all on-balance sheet funds, risk sharing as well as capital certain; and how liquidity should be managed for funds, which are held off balance sheet. The basic issue, however, as for any bank is how easily and quickly, and with what penalty, assets can be turned into cash. The establishment of a genuine inter-bank market or markets would be a significant step towards providing Islamic banks with the ability to maintain adequate liquidity without holding excessive amounts of very short-term assets. For example, it was very interesting to note that the Bahrain Monetary Authority (BMA) announced the first issue of its Islamically-structured bonds the Sukuk al-Salaam worth US$ 25mn. ABC Clearing Company BC and ABC Islamic Bank have been active in offering overnight investment opportunities for Islamic funds for a number of years. BNP Paribas and Kuwait Finance House signed a memorandum of understanding for the creation of a US$ 2bn Islamic money market fund (IMMF). Bank of America, Deutsche Bank, and ABN AMRO also plan to launch such instruments. Malaysia has also been developing an Islamic inter bank market. These developments offer potential flexibility to Islamic banks. UK practice is such that the Financial Statement Analysis (FSA) has scope to take account of such developments when agreeing liquidity guidelines with banks (www.financeinislam.com). CONCLUSION There are two different categories of commercial financing from an accounting perspective: on-balance-sheet financing and off-balance-sheet financing. Understanding the difference can be critical to obtaining the right type of commercial financing for your company. Put simply, on-balance-sheet financing is commercial financing in which capital expenditures appear as a liability on a companys balance sheet. Commercial loans are the most common example: Typically, a company will leverage an asset (such as accounts receivable) in order to borrow money from a bank, thus creating a liability (i.e., the outstanding loan) that must be reported as such on the balance sheet. With off-balance-sheet financing, however, liabilities do not have to be reported because no debt or equity is created. The most common form of off-balance-sheet financing is an operating lease, in which the company makes a small down payment upfront and then monthly lease payments. When the lease term is up, the company can usually buy the asset for a minimal amount (often just one dollar). The key difference is that with an operating lease, the asset stays on the lessors balance sheet. The lessee only reports the expense associated with the use of the asset (i.e., the rental payments), not the cost of the asset itself (www.evancarmichael.com). Why Does It Matter? This might sound like technical accounting-speak that only a CPA could appreciate. In the continuing tight credit environment, however, off-balance-sheet financing can offer significant benefits to any size company, from large multi-nationals to mom-and-pops. These benefits arise from the fact that off-balance-sheet financing creates liquidity for a business while avoiding leverage, thus improving the overall financial picture of the company. This can help companies keep their debt-to-equity ratio low: If a company is already leveraged, additional debt might trip a covenant to an existing loan. The trade-off is that off-balance-sheet financing is usually more expensive than traditional on-balance-sheet loans. Business owners should work closely with their CPAs to determine whether the benefits of off-balance-sheet financing outweigh the costs in their specific situation. Other Types of Off-Balance-Sheet Financing An increasingly popular type of off-balance-sheet financing today is whats known as a sale/leaseback. Here, a business sells property it owns and then immediately leases it back from the new owner. It can be used with virtually any type of fixed asset, including commercial real estate, equipment and commercial vehicles and aircraft, to name a few. A sale/leaseback can increase a companys financial flexibility and may provide a large lump sum of cash by freeing up the equity in the asset. This cash can then be poured back into the business to support growth, pay down debt, acquire another business, or meet working capital needs. Factoring is another type of off-balance-sheet financing. Here, a business sells its outstanding accounts receivable to a commercial finance company, or factor. Typically, the factor will advance the business between 70 and 90 percent of the value of the receivable at the time of purchase; the balance, less the factoring fee, is released when the invoice is collected. Like with an operating lease, no debt is created with factoring, thus enabling companies to create liquidity while avoiding additional leverage. The same kinds of off-balance-sheet benefits occur in both factoring arrangements and operating leases. Keep in mind that strict accounting rules must be followed when it comes to properly distinguishing between on-balance-sheet and off-balance-sheet financing, so you should work closely with your CPA in this regard. But with the continued uncertainty surrounding the economy and credit markets, its worth looking into the potential benefits of off-balance-sheet financing for your company (www.evancarmichael.com). The perspective of the Regulator The fundamental stance of the regulator is that the same principles in the handling of risk should apply for Islamic as for non-Islamic banks and financial entities. There has to be a level playing field. For the regulator, risk management in the Islamic context is becoming easier to understand as the following develop: A set of common international equivalent accounting standards. The AAOIFI is a doing a lot of good work in this area but we need to see more harmonization. Greater standardization of products. A clear role for the Shariah Board. For example, if there were to be one Board per country it should assist in giving consistency of interpretation of the Shariah. The FSA has had no applications for authorization from purely Islamic banks. If an application were to be made, it would be considered against our minimum criteria and principles for business. For us, an important aspect of any application would be the effectiveness of the applicants risk management systems and controls (www.financeinislam.com).