Tag: Learned

Learned!

To learn new things is beneficial at any age, and any kind of learning can benefit other aspects of your life. For instance, taking music lessons can increase your language skills. If you’re interested in a topic, study it. If you’d like a new skill, practice it. Your life is ever-changing and infinitely complex, and your ability to experience it depends on your willingness the learn. The more you learned, the more you live.

Embrace failure and confusion. When you are learning a new thing, you are entering into unknown territory. Allow yourself to experience the confusion of unanswered questions and unfamiliar parameters. When you study a new topic, don’t look up answers to your questions right away. Instead, spend some time trying to figure the answers out on your own. This kind of trying (and failing) helps you better understand what you are learning.

What is Foreign Exchange Market or Forex Market?

A Foreign exchange market or Forex market is a market in which currencies are bought and sold. It is to distinguish from a financial market where currencies borrow and lent. This market determines the foreign exchange rate. It includes all aspects of buying, selling, and exchanging currencies at current or determined prices. In terms of trading volume, it is by far the largest market in the world, followed by the Credit market. Also learned, Goods and Services Tax, What is Foreign Exchange Market or Forex Market?

Learn and Study, What is Foreign Exchange Market or Forex Market?

The foreign exchange market (Forex, FX, or currency market); a global decentralized or over-the-counter (OTC) market for the trading of currencies.

Definition of Foreign Exchange Market:

It is a market where the buyers and sellers involving in the sale; and, purchase of foreign currencies. In other words, a market where the currencies of different countries are bought and sold calls a foreign exchange market.

The structure of the foreign exchange market constitutes central banks, commercial banks, brokers, exporters and importers, immigrants, investors, tourists. These are the main players of the foreign market, their position, and place shown in the figure below.

At the bottom of a pyramid are the actual buyers; and, sellers of the foreign currencies- exporters, importers, tourists, investors, and immigrants. They are actual users of the currencies and approach commercial banks to buy them.

The commercial banks are the second most important organ of the foreign exchange market. The banks dealing in foreign exchange play a role of “market makers”; in the sense that they quote daily the foreign exchange rates for buying and selling of foreign currencies. Also, they function as clearinghouses; thereby helping in wiping out the difference between the demand for and the supply of currencies. These banks buy currencies from the brokers and sell them to the buyers.

Other things:

The third layer of a pyramid constitutes the foreign exchange brokers. These brokers function as a link between the central bank and the commercial banks; and, also between the actual buyers and commercial banks. They are the major source of market information. These are the persons who do not themselves buy the foreign currency; but rather strike a deal between the buyer and the seller on a commission basis.

The central bank of any country is the apex body in the organization of the exchange market. They work as the lender of the last resort and the custodian of foreign exchange of the country. Also, the central bank has the power to regulate and control the foreign exchange market to assure that it works in an orderly fashion. One of the major functions of the central bank is to prevent the aggressive fluctuations in the foreign exchange market, if necessary, by direct intervention. Intervention in the form of selling the currency when it overvalues and buying it when it tends to undervalue.

General Features of Forex Market:

They describe it as an OTC (Over the counter) market as there is no physical place where the participants meet to execute their deals. It is more an informal arrangement among the banks and brokers operating in a financing center purchasing and selling currencies, connected by telecommunications like telex, telephone, and a satellite communication network, SWIFT (Society for Worldwide Interbank Financial Telecommunication).

The term foreign exchange market uses to refer to the wholesale segment of the market, where the dealings take place among the banks. Also, the retail segment refers to the dealings that take place between banks and their customers. Also, the retail segment refers to the dealings that take place between banks and their customers. The retail segment situates in a large number of places. They can consider not as foreign exchange markets, but as the counters of such markets.

The leading foreign exchange market in India is Mumbai, Calcutta, Chennai, and Delhi is other center’s accounting for the bulk of the exchange dealings in India. The policy of the Reserve Bank has been to decentralize exchange operations and develop broader-based exchange markets. As a result of the efforts of Reserve Bank Cochin, Bangalore, Ahmadabad, and Goa have emerged as the new center of the foreign exchange market.

Size of the Market:

It is the largest financial market with a daily turnover of over USD 2 trillion. Also, Foreign exchange markets were primarily developed to facilitate the settlement of debts arising out of international trade. But these markets have developed on their own so much so that a turnover of about 3 days in the foreign exchange market is equivalent to the magnitude of world trade in goods and services.

The largest foreign exchange market in London was followed by New York, Tokyo, Zurich, and Frankfurt. As well as, the business in foreign exchange markets in India has shown a steady increase as a consequence of the increase in the volume of foreign trade of the country, improvement in the communications systems, and greater access to the international exchange markets. Still, the volume of transactions in these markets amounting to about USD 2 billion per day does not compete favorably with any well developed foreign exchange market of international repute.

The reasons are not far to seek. Also, the rupee is not an internationally traded currency and is not in great demand. Much of the external trade of the country designated in leading currencies of the world, Viz., US dollar, pound sterling, Euro, Japanese yen, and Swiss franc. Incidentally, these are the currencies that trade actively in the foreign exchange market in India.

24 Hours Market:

The markets are situated throughout the different time zones of the globe in such a way that when one market is closing the other is beginning its operations. Thus at any point in time one market or the other is open. Therefore, it states that the foreign exchange market is functioning 24 hours of the day.

However, a specific market will function only during business hours. Some of the banks having the international network and having centralized control of funds management may keep their foreign exchange department in the key center open throughout to keep up with developments at other centers during their normal working hours. In India, the market is open for the time the banks are open for their regular banking business. No transactions take place on Saturdays.

Efficiency:

Developments in communication have largely contributed to the efficiency of the market. Also, the participants keep abreast of current happenings by access to such services as Dow Jones Telerate and Teuter.

Any significant development in any market is almost instantaneously received by the other market situated at a far off place and thus has a global impact. This makes the foreign exchange market very efficient as if the functions under one roof.

Currencies Traded in Forex Markets:

In most markets, the US dollar is the vehicle currency, Viz., the currency used to denominate international transactions. This is even though with currencies like the Euro and Yen gaining a larger share, the share of the US dollar in the total turnover is shrinking.

Physical Markets:

In few centers like Paris and Brussels, foreign exchange business takes place at a fixed place, such as the local stock exchange buildings. At these physical markets, the banks meet and in the presence of the representative of the central bank and based on bargains, fix rates for several major currencies. This practice calls fixing.

The rates thus fixed uses to execute customer orders previously placed with the banks. An advantage claimed for this procedure is that the exchange rate for commercial transactions will market-determine, not influence by any one bank. However, it observes that the large banks attending such meetings with large commercial orders backing up, tend to influence the rates.

What is Foreign Exchange Market or Forex Market?

May 15, 2018
What is the Scope of Industrial Relations?
The concept of industrial relations is explaining their scope and IR has a very wide meaning and connotation. In the narrow sense, it means that the employer, employee relationship confines itself to the relationship that emerges out of the day to day association of the management and the labor. In its wider sense, industrial relations include the relationship between an employee and an employer in the course of the running of an industry and may project it to spheres, which may transgress to the areas of quality control, marketing, price fixation and disposition of profits among others. Also, learn the Importance of Industrial Relations.

Learn and Study, What is the Scope of Industrial Relations?

The term industrial relations has a broad as well as a narrow outlook. Originally, industrial relations broadly define to include the relationships and interactions between employers and employees. From this perspective, industrial relations covers all aspects of the employment relationship, including human resource management, employee relations, and union-management (or labor) relations. Now its meaning has become more specific and restricted.

Accordingly, industrial relations pertains to the study and practice of collective bargaining, trade unionism, and labor-management relations, while human resource management is a separate, largely distinct field that deals with nonunion employment relationships and the personnel practices and policies of employers.

The scope of industrial relations is quite vast.

The main issues involved here include the following:
- Collective bargaining.
- Machinery for settlement of industrial disputes.
- Standing orders.
- Worker’s participation in management, and.
- Unfair labor practices.
Definition and Scope of industrial relations:

The ultimate aim of any human activity at the socio-economic level should be the minimal use of available resources in achieving the maximum economic and social results, i.e. to be increasingly productive. The productivity of capital, machines, and resources other than human resources can be improved in various ways.

But improving the productivity of human resources is a complex and onerous task, for the simple reason that “labor” stands for both an individual human being and a group of individuals with different perceptions about productivity, motivation and attitudes, and with different needs. In organizations, individuals do not operate in isolation. They interact and react collectively to various issues in which management has an interest, including productivity.

Thus productivity improvement extends beyond the domain of the management of workers and becomes a labor-management or industrial relations issue to be negotiated, settled and implemented jointly by the management and the union. Productivity improvement as an industrial relations issue thus acquires a greater significance in all enterprises where the employees are organized.

“Industrial relations” broadly means the relations arising out of employment. In this broad sense, it covers the area of personnel management or human resources management and labor-management relations or labor relations. In its narrower sense, it refers only to the relations between management and the unions. And in its popular usage, it refers only to labor-management relations.

More things…

Industrial relations in organizations is the total of the management’s attitude to labor and of labor’s attitude to management’s policies and practices that affect the interests of the employees. Industrial relations are, basically, interactions between management and union(s). They involve continuous dialogue between the two sides on various issues of common interest; through such dialogues, the two sides shape each other’s attitudes.

The approach, methods, strategies, and techniques, etc., of management in achieving the desired objectives vary from one organization to another. This is especially true about productivity improvement through industrial relations. It is, therefore, primarily the responsibility of management to develop industrial relations with workers and the unions to promote productivity continuingly.

Another scope of Industrial Relations:

Based on the above definitions, the scope of Industrial Relations can easily be delineated as follows:
1. Labor relations, i.e., relations between labor union and management.
2. Employer-employee relations i.e. relations between management and employees.
3. The role of various parties’ viz., employers, employees, and state in maintaining industrial relations.
4. The mechanism of handling conflicts between employers and employees, in case of conflicts, arise.
The main aspects of industrial relations can be identified as follows:
1. Promotion and development of healthy labor-management relations.
2. Maintenance of industrial peace and avoidance of industrial strife.
3. Development and growth of industrial democracy.
Scope of Industrial Relations, Image from Online.
May 13, 2018
What is the Importance of Industrial Relations?
Industrial relations refers to processes and outcomes involving employment relationships. Importance of Industrial Relations for Employees and Employers. Frequently the term used in a narrower sense, for employment relationships involving the collective representation of employees in the form of a labor union or employee association, especially in the United States.

Learn and Study, What is the Importance of Industrial Relations?

At the other extreme, industrial relations has been defined by Thomas A. Kochan, in his book Collective Bargaining and Industrial Relations, as “all aspects of people at work,” but there are some aspects of people at work that entail highly technical subjects (e.g., industrial hygiene, ergonomics) which are not normally regarded as falling within the mainstream of industrial relations study. Also, learn the Importance of Employee Relations.

4 Importance of Industrial Relations:

The following industrial relations 4 importance below are;
- Increased Productivity: With amicable industrial relations both the workers and managers continue to work on their respective position and contribute towards the overall productivity of the firm. Thus, IR ensures the continuity of production.
- Reduced Industrial Disputes: An effective IR helps in the reduction of industrial disputes as both the management and the workers maintain harmonious relations with each other and work in unison towards the accomplishment of production objectives.
- Increased Morale: The peaceful industrial relations boost the moral level of the employees as they feel that their interest coincides with that of the employer’s, and their efforts will result in the overall profitability of the firm.
- Minimization of Wastage: A good IR ensures reduced wastage as the resources – Man, Machinery, Material are fully utilized and are effectively contributing towards the overall productivity of the firm.
More importance;

The significance of good industrial relations in any country cannot ones emphasize. Good industrial relations are necessary for the following reasons.
1. To help in the economic progress of a country. The problem of an increase in productivity is essentially the problem of maintaining good industrial relations. That is why they form an important part of the economic development plan of every civilized nation.
2. To help in to establish and to maintain true industrial democracy this is a prerequisite for the establishment of a socialist society.
3. They help the management both in the formulations of informed labor relations policies and in their translation into action.
4. To encourage collective bargaining as a means of self-regulation. They consider the negotiation process as an educational opportunity a chance both to learn and to reach.
5. To help the government making laws forbidding unfair practices of unions and employers. In climate good industrial relations every party works for the solidarity of worker’s movement. Unions gain more strength and vitality. There is no inter-union rivalry.
6. Employees give unions their rightful recognition and encourage them to participate in all decisions. Unions divert their activities from fighting and belligerence to increase the size of the distribution and to make their members more informed (workers education) on vital issues concerning them.
7. To boost the discipline and morale of workers. Maintenance of discipline ensures orderliness. Effectiveness and economy in the use of resources. On the other hand, lack of discipline means waste, loss, and confusion. It also means insubordination and non-co-operation.
8. Industrial relations are eventually human relations, therefore, the same basis of human psychology prevails in the field of industrial relations, and the efficiency of an industry is directly related to the quality of the relationship, which is being built up amongst the individuals who work together.
Importance of Industrial Relations for Employees and Employers:

Industrial relations usually imply good and positive relations between employees and employers. The good Industrial Relations help run an industry effectively and successfully, i.e., the desideratum of the day. Top 5 importance of Industrial Relations can imbue with the multiplicity of justifications.

To mention, good Industrial Relations help:

Foster Industrial Peace:

Under the mechanism of Industrial Relations, both employees and managers discuss the matter and consult each other before initiating any actions. Doubts, if any, in the minds of either party are removed. Thus, unilateral actions that prop confusion and misunderstanding disappear from the scene. In this way, Industrial Relations helps create a peaceful environment in the organization. Peace, in turn, breeds prosperity.

Promote Industrial Democracy:

Industrial democracy means the government-mandated worker participation at various levels of the organization about decisions that affect workers. It is mainly the joint consultations, that pave the way for industrial democracy and cement relationships between workers and management. This benefits them both. The motivated workers give their best and maximum to the organization, on the one hand, and share their share of the fruits of organizational progress jointly with management, on the other.

The benefit to Workers:

Industrial Relations benefits workers in several ways. For example, it protects workers against unethical practices on the part of management to exploit workers by putting them under inhuman working conditions and niggardly wages. It also provides a procedure to resolve workers’ grievances relating to work.

The benefit to Management:

Industrial Relations protects the rights of managers too. As and when workers create the problem of indiscipline, Industrial Relations provides managers with a system to handle employee indiscipline in the organization.

Improve Productivity:

Experiences indicate that good industrial relations serve as the key to increased productivity in industrial organizations. Eicher Tractors, Alwar represents one such case. In this plant, productivity went up from 32 percent to 38 percent between 1994 and 1997. This increase attribute to the peaceful IR in the plant.

Similar other success stories abound in the country. As reported by V.S.P. Rao, Sundaram Fasteners (A TVS group company which begged the prestigious GM award for the fourth successive year in 1999 as a quality supplier of radiator caps) well knows for zero breakdowns, zero accidents, and zero defects. The company did not lose even a single day due to strike. The per-employee productivity is comparable to the best in the world. One study rates the company among the 20 most competitive companies in Asia.

Importance of Industrial Relations for Employees, Image from Online.
May 11, 2018
Do you know what is Industrial relations?
Industrial relations are the relationships between employees and employers within organizational settings. The field of industrial relations looks at the relationship between management and workers, particular groups of workers represented by a union. This article explains Industrial Relations by their meaning and different definition; Industrial relation is the interactions between employers, employees and the government, and the institutions and associations through which such interactions mediate. Also learn, Know What is Employee Relations?

Learn and Understand, Do You know what is Industrial relations? Meaning and Definition.

The term industrial relation has a broad as well as a narrow outlook. Originally, industrial relations broadly define to include the relationships and interactions between employers and employees. From this perspective, industrial relations covers all aspects of the employment relationship, including human resource management, employee relations, and union-management (or labor) relations. Now its meaning has become more specific and restricted.

Accordingly, industrial relations pertains to the study and practice of collective bargaining, trade unionism, and labor-management relations; while human resource management is a separate, largely distinct field that deals with nonunion employment relationships and the personnel practices and policies of employers.

The meaning of Industrial relations; IR is a multidisciplinary field that studies the employment relationship. Industrial relations are increasingly being called employment relations or employee relations because of the importance of non-industrial employment relationships; this move sometimes sees as further broadening of the human resource management trend. Indeed, some authors now define human resource management as synonymous with employee relations.

Other authors see employee relations as dealing only with non-unionized workers, whereas labor relations see as dealing with unionized workers. Also know more, Industrial relation studies examine various employment situations, not just ones with a unionized workforce. However, According to Bruce E. Kaufman;

“To a large degree, most scholars regard trade unionism, collective bargaining and labor-management relations, and the national labor policy and labor law within which they are embedded, as the core subjects of the field.”

Definition of Industrial Relations:

After, their meaning they define their definition of industrial relations according to different authors below are;

“Employer-employee relationships that are covered specifically under collective bargaining and industrial relation laws.”

According to Dale Yoder’,

“IR is a designation of a whole field of relationship that exists because of the necessary collaboration of men and women in the employment processes of Industry.”

In the opinion of V. B. Singh;

“Industrial relations are an integral aspect of social relations arising out of employer-employee interaction in modern industries which are regulated by the State in varying degrees, in conjunction with organized social forces and influenced by the existing institutions. This involves a study of the State, the legal system, and the workers’ and employers’ organizations at the institutional level; and of the patterns of industrial organization (including management), capital structure (including technology), compensation of the labor force, and a study of market forces all at the economic level.”

Encyclopedia Britannica defined IR more elaborately as;

“The concept of industrial relations has been extended to denote the relations of the state with employers, workers, and other organizations. The subject, therefore, includes individual relations and joint consultation between employers and workers at their places of work, collective relations between employers and trade unions; and the part played by the State in regulating these relations.”

As the name implies, Industry Relations comprises of two words, Industry, and Relations. Where industry covers the production activity in which the group of workmen engages; while the relations show the relationship between the management and the workers within the industry. IR plays a significant role in today’s working scenario where the harmonious relationship between the employers and employees needs to have an uninterrupted production.

Industrial Relations mainly cover the following:
- Regulatory body to resolve industrial disputes.
- Collective Bargaining.
- The role of management, unions, and government.
- Labor Legislation.
- Worker’s Grievance Redressal system.
- Disciplinary policy and practice, and.
- They give Training.
The relationships which arise at and out of the workplace generally include the relationships between individual workers; the relationships between workers and their employer and the relationships between employees. Also learn, What is the Importance of Employee Relations? The relationships employers and workers have with the organizations form to promote their respective interests; and, the relations between those organizations, at all levels.

Industrial relation also includes the processes through which these relationships express (such as, collective bargaining, workers’ participation in decision-making, and grievance and dispute settlement); and, the management of conflict between employers, workers and trade unions, when it arises.

Do you know what is Industrial Relations? meaning and definition. Image from Online.
May 10, 2018
What is the Importance of Employee Relations?

Maintaining healthy Importance of employee relations in an organization is a prerequisite for organizational success. Strong employee relations are required for high productivity and human satisfaction. Employee relations generally deal with avoiding and resolving issues concerning individuals which might arise out of or influence the work scenario. Strong employee relation depends upon a healthy and safe work environment, a cent percent involvement and commitment of all employees, incentives for employee motivation, and an effective communication system in the organization.

Learn, Why Employee Relations at Workplace? and, What is the Importance of Employee Relations?

Healthy employee relations lead to more efficient, motivated, and productive employees which further leads to an increase in sales level. What are Employee Relations? According to the Chartered Institute of Personnel Development, the use of industrial relations to describe workplace relations is no longer as prevalent, due to the widespread deindustrialization of developed economies and declining union membership. Instead, employers now use the term “employee relations,” which refers to relationships that exist in both unionized and nonunionized workplaces. Employers hope to manage employee relations successfully with each respective individual, as a means to raise morale and productivity.

Every individual in the workplace shares a certain relationship with his fellow workers. Human beings are not machines that can start working just at the push of a mere button. They need people to talk to, discuss ideas with each other, and share their happiness and sorrows. An individual cannot work on his own, he needs people around. If the organization is empty, you will not feel like sitting there and working. An isolated environment demotivates an individual and spreads negativity around. People must be comfortable with each other and work together as a single unit towards a common goal.

Introduction

However, when it comes to employee relationships, they can only have a good relationship when they are disappointed with the company. Sometimes cutting through the hard work with some fun games is essential. Some fun outdoor activities and some employee appreciation gifts are always encouraged.

Employees must share a healthy relationship at the workplace. Let us find out why the importance of employee relations in an organization:

There are several issues on which an individual cannot take decisions alone:

He needs the guidance and advice of others as well. Sometimes we might miss out on important points, but our fellow workers may come out with a brilliant idea that would help us to achieve our targets at a much faster rate. Before implementing any plan, the pros and cons must be evaluated in an open forum where every employee has the right to express his opinions freely. On your own, you will never come to know where you are going wrong, you need people who can act as critics and correct you wherever you are wrong. If you do not enjoy a good relationship with others no one will ever come to help you.

Work becomes easy if it is shared among all:

A healthy relationship with your fellow workers would ease the workload on you and in turn, increases your productivity. One cannot do everything on his own. Responsibilities must be divided among team members to accomplish the assigned tasks within the stipulated time frame. If you have a good rapport with your colleagues, they will always be eager to assist you in your assignments making your work easier.

The organization becomes a happy place to work if the employees work together as a family:

An individual tends to lose focus and concentration if his mind is always clouded with unnecessary tensions and stress. It has been observed that if people talk and discuss things with each other, tensions automatically evaporate and one feels better. Learn to trust others, you will feel relaxed. One doesn’t feel like going to the office if he is not on talking terms with the person sitting next to him.

An individual spends around 8-9 hours a day at his workplace and practically it’s not possible that one works nonstop without a break. You should have people with whom you can share your lunch, discuss movies or go out for a stroll once in a while. If you fight with everyone, no one will speak to you and you will be left all alone. It is important to respect others to expect the same from them.

An individual feels motivated in the company of others whom he can trust and fall back on whenever needed:

One feels secure and confident and thus delivers his best. It is okay if you share your secrets with your colleagues but you should know where to draw the line. A sense of trust is important.

Healthy employee relations also discourage conflicts and fights among individuals:

People tend to adjust more and stop finding faults in each other. Individuals don’t waste their time in meaningless conflicts and disputes, rather concentrate on their work and strive hard to perform better. They start treating each other as friends and try their level best to compromise and make everyone happy.

A healthy employee relationship reduces the problem of absenteeism at the workplace:

Individuals are more serious about their work and feel like coming to the office daily. They do not take frequent leaves and start enjoying their work. Employees stop complaining about each other and give their best.

It is wise to share a warm relationship with your fellow workers because you never know when you need them:

You may need them at any time. They would come to your help only when you are nice to them. You might need to leave for some personal reasons; you must have a trusted colleague who can handle the work on your behalf. Moreover, healthy employee relations also spread positivity around.

It is essential that employees are comfortable with each other for better focus and concentration, lesser conflicts, and increased productivity. Now, you may understand the importance of employee relations.

What is the Importance of Employee Relations?

May 10, 2018
Do you Know What are Employee Relations?

Learn and Understand, Do you Know What are Employee Relations?

Employee Relations, An organization can’t perform only with the help of chairs, tables, fans or other non-living entities. It needs human beings who work together and perform to achieve the goals and objectives of the organization. The human beings working together towards a common goal at a commonplace (organization) are called employees. In fact, the employees are the major assets of an organization. Also learn, Employee and Industrial Relations, Do you Know What are Employee Relations?

“The success and failure of any organization are directly proportional to the labor put by each and every employee.” The employees must share a good rapport with each other and strive hard to realize the goal of the organization. They should complement each other and work together as a single unit. For the employees, the organization must come first and all their personal interests should take a back seat.

Definition of Employee Relations:

“Communications between management and employees concerning workplace decisions, grievances, conflicts, problem resolutions, unions, and issues of collective bargaining.”

According to the Chartered Institute of Personnel Development, the use of industrial relations to describe workplace relations is no longer as prevalent, due to the widespread deindustrialization of developed economies and declining union membership. Instead, employers now use the term “employee relations,” which refers to relationships that exist in both unionized and nonunionized workplaces. Employers hope to manage employee relations successfully with each respective individual, as a means to raise morale and productivity.

Employee relations is your company’s structure of managing the rapport between the bosses and the staff. “Well in that case, what is the difference between HR and employee relations?”

That’s an easy one, employee relations are just one facet of the role of HR. HR is an umbrella term which includes tasks such as payroll, updating employee databases and many more responsibilities – one of these being managing ER.

Our knowledge of how important ER is has helped us shape how we make our HR software. Features such as letting an employee clearly keep track of their staff benefits and tools to let their workers get to know more about them are all in place to create a happier workplace.

Better Understand, What are Employee Relations?

Every individual shares a certain relationship with his colleagues at the workplace. The relationship is either warm, so-so or bad. The relationship can be between anyone in the organization – between co-workers, between an employee and his superior, between two members in the management and so on. It is important that the employees share a healthy relationship with each other to deliver their best performances.

An individual spends his maximum time at the workplace and his fellow workers are the ones with whom he spends the maximum hours in a day. No way can he afford to fight with his colleagues. Conflicts and misunderstandings only add to tensions and in turn, decrease the productivity of the individual. One needs to discuss so many things at work and needs the advice and suggestions of all to reach a solution which would benefit the individual as well as the organization.

No individual can work alone. He needs the support and guidance of his fellow workers to come out with a brilliant idea and deliver his level best.

Employee relations refer to the relationship shared among the employees in an organization.

The employees must be comfortable with each other for a healthy environment at work. It is the prime duty of the superiors and team leaders to discourage conflicts in the team and encourage a healthy relationship among employees.

Life is really short and it is important that one enjoys each and every moment of it. Remember in an organization you are paid for your hard work and not for cribbing or fighting with each other. Don’t assume that the person sitting next to you is your enemy or will do any harm to you. Who says you can’t make friends at work, in fact, one can make the best of friends in the office. There is so much more to life than fighting with each other.

Observation says that a healthy relationship among the employees goes a long way in motivating the employees and increasing their confidence and morale. One starts enjoying his office and does not take his work as a burden. He feels charged and fresh the whole day and takes each day at work as a new challenge. If you have a good relationship with your team members you feel going to office daily. Go out with your team members for a get together once in a while or have your lunch together. These activities help in strengthening the bond among the employees and improve the relations among them.

An employee must try his level best to adjust to each other and compromise to his best extent possible.

If you do not agree with any of your fellow worker’s ideas, there are several other ways to convince him. Sit with him and probably discuss with him where he is going wrong and needs a correction. This way he would definitely look up to you for your advice and guidance in future. He would trust you and would definitely come to your help whenever you need him. One should never spoil his relations with his colleagues because you never know when you need the other person.

Avoid using foul words or derogatory sentences against anyone. Don’t depend on lose talk in office as it spoils the ambiance of the place and also the relationships among the employees. Blame games are a strict no-in office.

One needs to enter his office with a positive frame of mind and should not unnecessarily make issues out of small things.

It is natural that every human being cannot think the way you think, or behave the way you behave. If you also behave in the similar way the other person is behaving, there is hardly any difference between you and him. Counsel the other person and correct him wherever he is wrong.

It is of utmost importance that employees behave with each other in a cultured way, respect each other and learn to trust each other. An individual however hardworking he is, cannot do wonders alone. It is essential that all the employees share a cordial relation with each other, understand each other’s needs and expectations and work together to accomplish the goals and targets of the organization.

May 10, 2018
What are Advantages and Disadvantages of GST?
Learn and Understand, What are Advantages and Disadvantages of GST?

Implementation of Goods and Services Tax (GST) was one of the long-awaited fiscal reform and due to various reasons it was only hanging around and could not circumvent the obstacles for the substantially long period of time so much so that people started saying that the reform may not see a light of the day. At this juncture, we need to understand that GST could eventually become a reality only because of the various advantages it brought along. Of course, no reform can be full proof and so is GST and therefore the implementation of GST had its own disadvantages with few being inherent and intrinsic to the idea of GST, few due to the structure in which it is brought and a lot is due to the manner in which it is implemented which could have been largely avoided. Also learn, Benefits of GST, What are Advantages and Disadvantages of GST?

Loading…

Taking too long?

Reload document
| Open in new tab

Download [167.00 B]

While we take a stock of GST as of today, we need to acknowledge the efforts taken by the government in making it much simpler from the time first model GST code was released in June 2016 to today when we are at the brisk of 200 days post its implementation. While we take a deeper dive into understanding the advantages and disadvantages of GST, we need to appreciate the fact that this being a transactional tax its advantages and disadvantages cannot be equated for all. For instance, it is possible that one sector or industry is largely benefitted due to the implementation of GST while other sector or industry has taken the exact opposite position. The point that we need to take home is that many advantages and disadvantages of GST can be closely understood only when its impact is measured industry or sector wise.

The list of advantages and disadvantages of GST can be very long, but herein we look at some of the major ones as explained below:

The Advantages of GST (Goods and Services Tax):
- Boosts Foreign Investment and improves the overall investment climate.
- Single assessing authority.
- Increased certainty/ Reduced litigation.
- Erosion of parallel economy.
- Reduced corruption.
- Downslide of prices.
- Common national market throughout the country, and.
- Increase in employment opportunities.
The Disadvantages of GST (Goods and Services Tax):
- Not a one nation one tax in spirit.
- Multiple Tax rates.
- GST Portal issues.
- Hurried implementation of the Law.
- Working capital blockage.
- High compliance burden.
- Elimination of local tax incentives/ schemes, and.
- Disconnect from Foreign Trade Policy.
May 9, 2018
Do you Know Benefits of GST (Goods and Services Tax)?

Learn, How, What is it, Do you Know Benefits of GST (Goods and Services Tax)?

GST stands for Goods and Services Tax which will be levied on the supply of goods or services or both in India. GST will subsume a number of existing indirect taxes being levied by the Centre and State Governments including Central Excise duty, Service Tax, VAT, Purchase Tax, Central Sales Tax, Entry Tax, Local Body Taxes, Octroi, Luxury Tax, etc. Also learn, GST, PDF, Do you Know Benefits of GST (Goods and Services Tax)?

Loading…

Taking too long?

Reload document
| Open in new tab

Download

It brings benefits to all the stakeholders’ viz. industry, government and the citizens. It is expected to lower the cost of goods and services, boost the economy and make our products and services globally competitive. GST aims to make India a common national market with uniform tax rates and procedures and removes the economic barriers, thereby paving the way for an integrated economy at the national level. By subsuming most of the Central and State indirect taxes into a single tax and by allowing a set-off of prior-stage taxes for the transactions across the entire value chain, GST would mitigate the ill effects of cascading and thereby improve our competitiveness.

GST or Goods and Service Tax is common tax system proposed by the government. As the name suggests it is a common tax for Goods and Services. In simple words today we are paying multiple taxes such as excise duty, customs duty, value added tax, octroi, service tax etc.

The Benefits of Goods and Services Tax (GST):

Elimination of Multiple Taxes:

The biggest benefit of GST is an elimination of multiple indirect taxes. All taxes that currently exist will not be in the picture. This means current taxes like excise, octroi, sales tax, CENVAT, Service tax, turnover tax etc will not be applicable and all that will fall under common tax called as GST.

Saving More Money:

For a common man, GST applicability means the elimination of double charging in the system. This will reduce the price of goods and services & help common man for saving more money. It is expected that price of FMCG products, small cars, cinema tickets, electrical wires etc is expected to reduce.

Ease of business:

GST will bring one country one tax concept. This will prevent unhealthy competition among states. It will be beneficial to do interstate business.

Easy Tax Filing and Documentation:

For a businessman, GST will be a boon. No multiple taxes means compliance and documentation will be easy. Return filing, tax payment, and refund process will easy and hassle-free.

Cascading Effect reduction:

GST will be applicable at all stages from manufacturing to consumption. GST will provide tax credit benefit at every stage in the chain. Today at every stage margin is added and tax is paid on the whole amount, in GST you will have tax credit benefit and tax will be paid on margin amount only. It will reduce cascading effect of tax thereby reducing the cost of the product.

More Employment:

As GST will reduce the cost of producing it is expected that demand for the product will increase and to meet the demand, supply has to go up. The requirement of more supply will be addressed by only increasing employment.

Increase in GDP:

As demand will grow naturally production will grow and hence it will increase gross domestic product. It is estimated that GDP will grow by 1-2% due to GST.

Reduction in Tax Evasion:

GST is a single tax which will include various taxes, making the system efficiency with very little chances of corruption and Tax Evasion.

More Competitive Product:

As GST will address cascading effect of the tax, inter-state tax, high logistics cost it will make manufacturing more competitive. This will bring advantage to businessman and consumer.

Increase in Revenue:

GST will replace all 17 indirect taxes with the single tax. Increase in product demand will ultimately increase tax revenue for state and central government.

Goods and service tax is a boon for the Indian economy and the common man. It is a welcome step taken by the government.

May 9, 2018
What is GST (Goods and Services Tax)?

Learn and Understand, What is GST (Goods and Services Tax)?

First, take analysis GST Full Form is Goods and Services Tax. The Goods and Services Tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the businesses selling the goods and services. In effect, GST provides revenue for the government. Also learn, the Concept of Financial Decisions, What is GST (Goods and Services Tax)?

What is GST? GST (Goods and Services Tax) is the biggest indirect tax reform of India. GST is a single tax on the supply of goods and services. It is a destination based tax. GST has subsumed taxes like Central Excise Law, Service Tax Law, VAT, Entry Tax, Octroi, etc. GST is expected to bring together state economies and improve overall economic growth of the nation.

Before learning more about Goods and Sevice Tax, let’s try to understand how taxes in India work. The Government of any country needs money for its functioning and taxes are a major source of revenue for a Government. The taxes thus collected are spent by Govt. on the public.

History of GST:

The goods and services tax (GST) is an indirect federal sales tax that is applied to the cost of certain goods and services. The business adds the GST to the price of the product; a customer who buys the product pays the sales price plus GST, and the GST portion is collected by the business or seller and forwarded to the government.

France was the first country to implement the GST in 1954, and since then an estimated 160 countries have adopted this tax system in some form or another. Some of the countries with GST include Canada, Vietnam, Australia, Singapore, UK, Monaco, Spain, Italy, Nigeria, Brazil, and South Korea. India is set to join the GST group on July 1, 2017.

Most countries with a GST have a single unified GST system, which means that a single tax rate is applied throughout the country. A country with a unified GST platform merges central taxes (e.g. sales tax, excise duty tax, and service tax) with state-level taxes (e.g. entertainment tax, entry tax, transfer tax, sin tax, and luxury tax) and collects them as one single tax. These countries tax virtually everything at a single rate.

Only a handful such as Canada and Brazil have a dual GST structure. Compared to a unified GST economy where tax is collected by the federal or central government and then distributed to the states, in a dual system, the federal GST is applied in addition to the state sales tax. In Canada for example, the federal government levies a 5% tax and some provinces/states also levy a provincial state tax (PST) which varies from 7 to 10%. In this case, a consumer’s receipt will clearly have the GST and PST rate that was applied to his or purchase value.

India is proposed to have a dual GST set up in 2017, which will be the biggest reform in the country’s tax structure in decades. The main objective of incorporating the GST is to eliminate the tax on tax i.e. double taxation which cascades from the manufacturing level to the consumption level.

Brief History of GST in India:

Introduction of GST is considered to be a significant step in the reform of indirect taxation in India. Amalgamating of various Central and State taxes into a single tax would help mitigate the double taxation, cascading, a multiplicity of taxes, classification issues, taxable event, etc., and leading to a common national market.

VAT rates and regulations differ from state to state. On the other hand, GST brings in uniform tax system across all the states. Here, the taxes would be divided between the Central and State government.

The current system with no GST implies that tax is paid on the value of goods and margin at every stage of the production process. This would translate to a higher amount of total taxes paid, which is carried down to the end consumer in the form of higher costs for goods and services. Implementing the GST system in India is, therefore, a measure that will be used to reduce inflation in the long run, as prices for goods will be lower.

These taxes are broadly classified into two types: Direct Tax and Indirect Tax

Direct Tax – Direct Tax is imposed on the Income of an individual. The amount of Tax payable varies on the income earned by the individual from various sources such as salary, house rent income etc. So, the more you earn, the more tax you pay to the Government which essentially means the rich pay more tax in comparison to the poor.

Indirect Tax – Indirect tax is not imposed directly on the income of individuals. Instead, it is imposed on goods and services which in turn increase the cost MRP) of Goods and Services. Unlike the direct tax, an indirect tax should be borne by the end customer, rich and poor alike., There are many indirect taxes. Some of these are levied by the Central Government whereas some are levied by the State Government making the indirect tax system an extremely complicated system.

GST has been introduced to replace multiple indirect taxes levied by State and Central Governments in order to simplify the indirect tax system. GST has replaced almost 17 of the existing state and central indirect taxes (more to come in the future) such as central excise duty, additional customs duty, VAT, entertainment tax, service tax etc.

It is called as Goods and Services Tax because it is applicable to the supply of both Goods and Services. Click for understanding GST with a simple example.

May 8, 2018
Factors Affecting the Major Types of Financial Decisions!
Learn and Understand, Factors Affecting the Major Types of Financial Decisions!

Definition: The Financing Decision is yet another crucial decision made by the financial manager relating to the financing-mix of an organization. It is concerning the borrowing and allocation of funds required for the investment decisions. Types of Decisions: i. Investment decision ii. Financing decision iii. Dividend decision iv. Liquidity Decision. Also learn, Simple Types of Financial Decisions, Factors Affecting the Major Types of Financial Decisions!

Some of the important functions which every finance manager has to take are as follows:

A. Investment decision.

B. Financing decision.

C. Dividend decision, and.

D. Liquidity Decision.

The following decision is explained below:

A. Investment Decision (Also Know, Capital Budgeting Decision):

This decision relates to the careful selection of assets in which funds will be invested by the firms. A firm has many options to invest their funds but the firm has to select the most appropriate investment which will bring maximum benefit to the firm and decide or selecting most appropriate proposal is investment decision.

The firm invests its funds in acquiring fixed assets as well as current assets. When decision regarding fixed assets is taken it is also called capital budgeting decision.

Factors Affecting Investment/Capital Budgeting Decisions:

1. Cash Flow of the Project:

Whenever a company is investing huge funds in an investment proposal it expects some regular amount of cash flow to meet day to day requirement. The amount of cash flow an investment proposal will be able to generate must assess properly before investing in the proposal.

2. Return on Investment:

The most important criteria to decide the investment proposal is the rate of return it will be able to bring back for the company in the form of income for, e.g., if project A is bringing 10% return and project В is bringing 15% return then we should prefer project B.

3. Risk Involved:

With every investment proposal, there is some degree of risk is also involved. The company must try to calculate the risk involved in every proposal and should prefer the investment proposal with the moderate degree of risk only.

4. Investment Criteria:

Along with return, risk, cash flow there are various other criteria which help in selecting an investment proposal such as availability of labor, technologies, input, machinery, etc.

The finance manager must compare all the available alternatives very carefully and then only decide where to invest the most scarce resources of the firm, i.e., finance.

Investment decisions are considered very important decisions because of following reasons:

(i) They are long-term decisions and therefore are irreversible; means once taken cannot change.

(ii) Involve huge amount of funds.

(iii) Affect the future earning capacity of the company.

Importance or Scope of Capital Budgeting Decision:

Capital budgeting decisions can turn the fortune of a company. The capital budgeting decisions are considered very important because of the following reasons:

1. Long-Term Growth:

The capital budgeting decisions affect the long-term growth of the company. As funds invested in long-term assets bring the return in future and future prospects and growth of the company depend upon these decisions only.

2. Large Amount of Funds Involved:

Investment in long-term projects or buying of fixed assets involves the huge amount of funds and if the wrong proposal is selected it may result in wastage of huge amount of funds that is why capital budgeting decisions are taken after considering various factors and planning.

3. Risk Involved:

The fixed capital decisions involve huge funds and also the big risk because the return comes in long run and company has to bear the risk for a long period of time till the returns start coming.

4. Irreversible Decision:

Capital budgeting decisions cannot reverse or change overnight. As these decisions involve huge funds and heavy cost and going back or reversing the decision may result in heavy loss and wastage of funds. So these decisions must take after careful planning and evaluation of all the effects of that decision because adverse consequences may be very heavy.

B. Financing Decision:

The second important decision which finance manager has to take is deciding source of finance. A company can raise finance from various sources such as by issue of shares, debentures or by taking loan and advances. Deciding how much to raise from which source is the concern of financing decision.

Mainly sources of finance can divide into two categories:
1. Owners fund.
2. Borrowed fund.
Share capital and retained earnings constitute owners’ fund and debentures, loans, bonds, etc. constitute borrowed fund.

The main concern of finance manager is to decide how much to raise from owners’ fund and how much to raise from a borrowed fund.

While taking this decision the finance manager compares the advantages and disadvantages of different sources of finance. The borrowed funds have to pay back and involve some degree of risk whereas in owners’ fund there is no fixing commitment of repayment and there is no risk involved. But finance manager prefers a mix of both types. Under financing, decision finance manager fixes a ratio of owner fund and borrowed fund in the capital structure of the company.

Factors Affecting Financing Decisions:

While taking financing decisions the finance manager keeps in mind the following factors:

1. Cost:

The cost of raising finance from various sources is different and finance managers always prefer the source with minimum cost.

2. Risk:

More risk is associated with the borrowed fund as compared to owner’s fund securities. Finance manager compares the risk with the cost involved and prefers securities with the moderate risk factor.

3. Cash Flow Position:

The cash flow position of the company also helps in selecting the securities. With smooth and steady cash flow companies can easily afford borrowed fund securities but when companies have a shortage of cash flow, then they must go for owner’s fund securities only.

4. Control Considerations:

If existing shareholders want to retain the complete control of business then they prefer borrowed fund securities to raise further fund. On the other hand, if they do not mind to lose the control then they may go for owner’s fund securities.

5. Floatation Cost:

It refers to the cost involved in the issue of securities such as broker’s commission, underwriters fees, expenses on the prospectus, etc. The firm prefers securities which involve least floatation cost.

6. Fixed Operating Cost:

If a company is having high fixed operating cost then they must prefer owner’s fund because due to high fixed operational cost, the company may not be able to pay interest on debt securities which can cause serious troubles for the company.

7. State of Capital Market:

The conditions in capital market also help in deciding the type of securities to raise. During boom period it is easy to sell equity shares as people are ready to take risk whereas during depression period there is more demand for debt securities in the capital market.

C. Dividend Decision:

This decision is concerned with the distribution of surplus funds. The profit of the firm is distributed among various parties such as creditors, employees, debenture holders, shareholders, etc.

Payment of interest to creditors, debenture holders, etc. is a fixed liability of the company, so what company or finance manager has to decide is what to do with the residual or left over the profit of the company.

The surplus profit is either distributed to equity shareholders in the form of the dividend or kept aside in the form of retained earnings. Under dividend decision, the finance manager decides how much to distribute in the form of dividend and how much to keep aside as retained earnings.

To take this decision finance manager keeps in mind the growth plans and investment opportunities.

If more investment opportunities are available and company has growth plans then more is kept aside as retained earnings and less is given in the form of dividend, but if company wants to satisfy its shareholders and has fewer growth plans, then more is given in the form of dividend and less is kept aside as retained earnings.

This decision is also called residual decision because it is concerned with the distribution of residual or leftover income. Generally new and upcoming companies keep aside more of retain earning and distribute less dividend whereas established companies prefer to give more dividend and keep aside less profit.

Factors Affecting Dividend Decision:

The finance manager analyses following factors before dividing the net earnings between dividend and retained earnings:

1. Earning:

Dividends are paid out of current and previous year’s earnings. If there are more earnings then company declares the high rate of dividend whereas during the low earning period the rate of dividend is also low.

2. Stability of Earnings:

Companies having stable or smooth earnings prefer to give the high rate of dividend whereas companies with unstable earnings prefer to give the low rate of earnings.

3. Cash Flow Position:

Paying dividend means outflow of cash. Companies declare the high rate of dividend only when they have surplus cash. In the situation of shortage of cash, companies declare no or very low dividend.

4. Growth Opportunities:

If a company has a number of investment plans then it should reinvest the earnings of the company. As to invest in investment projects, the company has two options: one to raise additional capital or invest its retained earnings. The retained earnings are the cheaper source as they do not involve floatation cost and any legal formalities.

If companies have no investment or growth plans then it would be better to distribute more in the form of the dividend. Generally, mature companies declare more dividends whereas growing companies keep aside more retained earnings.

5. Stability of Dividend:

Some companies follow a stable dividend policy as it has the better impact on shareholder and improves the reputation of the company in the share market. The stable dividend policy satisfies the investor. Even big companies and financial institutions prefer to invest in a company with regular and stable dividend policy.

There are three types of stable dividend policies which a company may follow:

(i) Constant dividend per share:

In this case, the company decides a fixed rate of dividend and declares the same rate every year, e.g., 10% dividend on investment.

(ii) Constant payout ratio:

Under this system, the company fixes up a fixed percentage of dividends on profit and not on investment, e.g., 10% on profit so dividend keeps on changing with the change in profit rate.

(iii) Constant dividend per share and extra dividend:

Under this scheme, a fixed rate of dividend on investment is given and if profit or earnings increase then some extra dividend in the form of bonus or interim dividend is also given.

6. Preference of Shareholders:

Another important factor affecting dividend policy is expectation and preference of shareholders as their expectations cannot ignore the company. Generally, it is observed that retired shareholders expect the regular and stable amount of dividend whereas young shareholders prefer capital gain by reinvesting the income of the company.

They are ready to sacrifice present-day income dividend for future gain which they will get with growth and expansion of the company.

Secondly poor and middle-class investors also prefer the regular and stable amount of dividend whereas wealthy and rich class prefers capital gains.

So if a company is having a large number of retired and middle-class shareholders then it will declare more dividend and keep aside less in the form of retained earnings whereas if company is having a large number of young and wealthy shareholders then it will prefer to keep aside more in the form of retained earnings and declare low rate of dividend.

7. Taxation Policy:

The rate of dividend also depends upon the taxation policy of the government. Under present taxation system dividend income is tax-free income for shareholders whereas. The company has to pay tax on dividend given to shareholders. If the tax rate is higher, the company prefers to pay less in the form of dividend whereas. If the tax rate is low then the company may declare the higher dividend.

8. Access to Capital Market Consideration:

Whenever company requires more capital it can either arrange it by the issue of shares or debentures in the stock market or by using its retained earnings. Rising of funds from the capital market depends upon the reputation of the company.

If capital market can easily access or approach and there is enough demand for securities of the company then company can give more dividend and raise capital by approaching capital market, but if it is difficult for company to approach and access capital market then companies declare low rate of dividend and use reserves or retained earnings for reinvestment.

9. Legal Restrictions:

Companies’ Act has given certain provisions regarding the payment of dividends that can pay only out of current year profit or past year profit after providing depreciation fund. In case the company is not earning the profit then it cannot declare the dividend.

Apart from the Companies’ Act, there are certain internal provisions of the company that is whether the company has enough flow of cash to pay the dividend. The payment of dividend should not affect the liquidity of the company.

10. Contractual Constraints:

When companies take a long-term loan then financier may put some restrictions or constraints on the distribution of dividend and companies have to abide by these constraints.

11. Stock Market Reaction:

The declaration of the dividend has an impact on the stock market as an increase in dividend is taken as a good news in the stock market and prices of security rise. Whereas a decrease in dividend may have the negative impact on the share price in the stock market. So possible impact of dividend policy on the equity share price also affects dividend decision.

D. Liquidity Decision:

It is very important to maintain a liquidity position of a firm to avoid insolvency. Firm’s profitability, liquidity, and risk all are associated with the investment in current assets. In order to maintain a tradeoff between profitability and liquidity. It is important to invest sufficient funds in current assets. But since current assets do not earn anything for business, therefore, a proper calculation must do before investing in current assets.

Current assets should properly value and dispose of from time to time once they become non-profitable. Currents assets must use in times of liquidity problems and times of insolvency.
April 23, 2018