FUNCTIONS OF MONEY

Functions of Money:
Money is something that is accepted as a form of payment for products or services, or for the payment of obligations. It is a medium of exchange with a specific value by which the value of all other things can be measured, which greatly facilitates trade and allows modern economies to enjoy the benefits of the division of labor. Wealth is the value of assets minus liabilities; money is one of those assets.

1. Unit of Account/Measure of Value:

Everything in the economy is quoted in terms of money. In this way, money functions as a unit of account.
This means that money is being used as the common benchmark to designate the prices of goods throughout the economy.
Because money is standardized into specific values, it can be used to price goods and services, and allows the easy comparison of prices.
Prices provide information for consumers and producers who allocate economic resources to their most desirable uses.
Items in demand command a higher price, which induces sellers to provide more of those items.

2. Medium of Exchange
Money is a medium of exchange because it can be used to buy goods and services in an attempt to satisfy unlimited needs and wants. Buyers give up money and receive goods. Sellers give up goods and receive money.
With a generally accepted medium of exchange, trades are easier and more efficient.

3. Store of Value
Value is obtained from a good when it is consumed, when it is used to satisfy wants and needs.
Money is one way of postponing the satisfaction obtained from using or consuming goods until at a later time.
The problem with storing value in money is price changes.
If the price of commodities rises, then money becomes a less effective means of storing value.
Unfortunately, inflation prevents most of the money in existence today from serving as a pure store of value, because the money loses a significant portion of its purchasing power over time. However, if there were no inflation, then money would serve as a near-perfect store of value.
4.TIME VALUE OF MONEY
A dollar in hand today is worth more than a dollar to be received in the future because, if you had it now, you could invest that dollar and earn interest.
Of all the techniques used in finance, none is more important than the concept of time value of money, also called discounted cash flow (DCF) analysis.
Future value and present value techniques can be applied to a single cash flow (lump sum), ordinary annuities, annuities due, and uneven cash flow streams. 
When compounding occurs more frequently than once a year, the effective rate of interest is greater than the quoted rate.

FUNCTIONS OF FINANCIAL MARKETS

Financial market is a market for the exchange of money. It brings together two kinds of people:
People who need money:
Borrowers in the financial market can be individuals who need money for personal consumption like buying a house, car, etc., private & public companies which need funds for expansion, setting up manufacturing facilities, launching a new product, R&D, etc., governments and other local authorities like municipalities to spend on public service and infrastructure like roads, healthcare, sanitation.
People who have surplus money:
Lenders in the financial market are actually the investors who have extra funds and want to use the additional money to earn more money. Their invested money is used to finance the requirements of borrowers. In return the investors expect to earn in the form of interests, dividends, company ownership, etc.

Financial Markets Functions:
Financial markets serve five basic functions. These functions are:
1.
Borrowing and Lending: Financial markets permit the transfer of funds (purchasing power) from one agent to another for either investment by the lender or consumption purposes by the borrower.

2.Information Aggregation and Coordination: Financial markets act as collectors and aggregators of information about financial product values and the flow of funds from lenders to borrowers.
This is an important function when it comes to transparency and results in better price discovery.
3.Price Determination:
Financial markets provide the platform by which prices are set both for new issues as well as existing financial products.
This function is similar to the way price mechanisms work in other markets through demand and supply.
A higher demand for a particular financial product results in a higher price and vice versa.
4.Risk Management:
Financial markets allow a transfer of risk from one person to another.
Examples of risk sharing are present in foreign currency transactions, derivatives etc.
If an exporter is worried about the Dollar appreciating, he can lock in the exchange rate by entering into a forward contract to buy in the future at a predetermined price.

5.Liquidity:
Financial markets provide the holders of financial assets with a chance to resell or liquidate these assets.

FUNCTIONS OF MONEY

Functions of Money:
Money is something that is accepted as a form of payment for products or services, or for the payment of obligations. It is a medium of exchange with a specific value by which the value of all other things can be measured, which greatly facilitates trade and allows modern economies to enjoy the benefits of the division of labor. Wealth is the value of assets minus liabilities; money is one of those assets.

1. Unit of Account/Measure of Value:

Everything in the economy is quoted in terms of money. In this way, money functions as a unit of account.
This means that money is being used as the common benchmark to designate the prices of goods throughout the economy.
Because money is standardized into specific values, it can be used to price goods and services, and allows the easy comparison of prices.
Prices provide information for consumers and producers who allocate economic resources to their most desirable uses.
Items in demand command a higher price, which induces sellers to provide more of those items.

2. Medium of Exchange
Money is a medium of exchange because it can be used to buy goods and services in an attempt to satisfy unlimited needs and wants. Buyers give up money and receive goods. Sellers give up goods and receive money.
With a generally accepted medium of exchange, trades are easier and more efficient.

3. Store of Value
Value is obtained from a good when it is consumed, when it is used to satisfy wants and needs.
Money is one way of postponing the satisfaction obtained from using or consuming goods until at a later time.
The problem with storing value in money is price changes.
If the price of commodities rises, then money becomes a less effective means of storing value.
Unfortunately, inflation prevents most of the money in existence today from serving as a pure store of value, because the money loses a significant portion of its purchasing power over time. However, if there were no inflation, then money would serve as a near-perfect store of value.
4.TIME VALUE OF MONEY
A dollar in hand today is worth more than a dollar to be received in the future because, if you had it now, you could invest that dollar and earn interest.
Of all the techniques used in finance, none is more important than the concept of time value of money, also called discounted cash flow (DCF) analysis.
Future value and present value techniques can be applied to a single cash flow (lump sum), ordinary annuities, annuities due, and uneven cash flow streams. 
When compounding occurs more frequently than once a year, the effective rate of interest is greater than the quoted rate.

CORE PRINCIPLES OF MONEY AND BANKING

The Five Core Principles of Money and Banking
Five core principles inform our analysis of the financial system and its interaction with the real economy. These principles are based on Time, Risk, Information, Markets, and Stability:

1.Time has value:
The first principle of money and banking is that time has value. Time has a price.  Time affects the value of financial transactions. Financial instruments with long maturities attract a higher compensation as compared to those with short term maturities. A dollar today is valuable than a dollar tomorrow.

2.Risk requires compensation:
With uncertainty, comes risk and dealing with risk requires that you consider the full range of possibilities in order to eliminate some risks, reduce others, pay someone to assume particular risks, and live with what’s left. Needless to say, no one will assume your risks for free. Compensation is made in the form of payments.

3.Information is the basis for decisions:
Most people collect information before making decisions. The collection and processing of information is the foundation of the financial system. Without information or with limited information, one makes un-informed choices that could lead to negative outcomes like losses. This is crippled by transaction costs.

4.Markets determine prices and allocate resources:
Markets are the place, physical or virtual where buyers and sellers meet.
Financial markets gather information from a large number of individual participants and aggregate it into a set of prices that signals what is valuable and what is not.
Thus markets are sources of information.
By attaching prices to different stocks, they provide a basis for the allocation of capital.

5.Stability improves welfare:
Stability is a desirable quality.
Volatility creates risk, reducing volatility reduces risk.
Hence, a major goal of financial systems is to provide economic stability.
Central banks have the major role of keeping the economy stable or stabilizing it if it falters. Central banks accomplish this by effecting monetary policies, such as adjusting the cost of money

CLASSIFICATIONS OF FINANCIAL INTERMEDIARIES TYPES OF FINANCIAL INTERMEDIARIES

2.5 Financial Intermediaries: Classifcation And Relationship.

Financial intermediaries are an organization of financial institutions, individuals and groups that link lenders and borrowers in the financial market. They act as middlemen and facilitate exchange of funds for financial securities. As expressed  earlier, financial institutions  exist primarily because of the conflict between lenders’ and borrowers’ requirements in  terms of deal size,  term to maturity, quality,  price and liquidity.
 
The distinguishing characteristics between banks, finance houses, insurance companies, unit trusts or any other type of intermediary lie  in the nature of  the claims  and services offered  to lenders and in  the nature of the  claims and  services offered  to the borrowers. 

It  is logical  to divide  financial intermediaries  into two broad  categories: mainstream financial  intermediaries (MFIs)  and QFIs.
It is  then reasonable  to classify  the  MFIs into deposit  and  non-deposit  intermediaries.
While  the  former  category  is  straightforward,  the second category may be split up in various ways.
A sensible split is into three categories:

1.Contractual Intermediaries (CIs),
2.Collective  Investment schemes (also  known as “portfolio intermediaries”)  (CISs)
3.Alternative Investments (AIs).

A.Deposit Intermediaries:
Under the category deposit intermediaries a central bank and the private sector banks are always present. In many countries other deposit-taking intermediaries are established for various reasons, such as mutual banks, savings and loan intermediaries, a Post  Office Bank etc.

Central bank: As is evident, the central bank intermediates between ultimate lenders; mainly the government (in its capacity as government banker), and the household sector (in its capacity as issuer of bank notes and coins) and the banks (i.e., their reserves required to be held for solvency and monetary policy purposes).
Private sector banks: The private  sector banks  intermediate between  all the  sectors that  make up  the ultimate  lenders, and virtually all other financial  institutions (in the form of  deposits and loans), on the  one hand, and all ultimate  borrowers (in the form of  loans, instalment credit and leasing contracts, mortgage advances and the  purchase of securities) on the other hand. E.g. Barclays Bank, Equity Bank.

B. Contractual Intermediaries:
The category contractual intermediaries  (CIs) is reserved for those intermediaries that offer contractual savings (and other like)  facilities: the insurers and the pension funds.

Insurers: Insurers may be split into two groups:  short-term insurers, long-term insurers (life companies or assurors). There  are also re-insurers, but they  fall into either of these  two groups.
Short-term insurers: intermediate between the  corporate and household sectors on the liabilities side of their collective balance  sheet (this is mainly in  the form of insurance policies issued), and the corporate and government sectors on the asset side of their balance sheet. E.g. Kenindia Insurance.
Long-term insurers: have a similar intermediation function as the short-term insurers. Their liabilities are comprised of various long-term polices, which are held mainly by  the corporate and household sectors, while, on the  asset side of their  balance sheet, they hold the  securities of all sectors  with the exception of the household sector. E.g. NHIF
Re-insurers: Like short-term insurers, they are not regarded as financial intermediaries by purist economists, because  their  liabilities  are  not certain. 
They intermediate between  other insurance companies and the corporate and  government sectors (in the form  of holdings of their securities).
Pension funds: Retirement funds also known as pension and provident funds intermediate between the public in the form of so-called contractual  savings on the one hand, and  ultimate borrowers mainly in the form  of shares/equities and securities of the  corporate and government and foreign sectors held. E.g. NSSF

Collective Unit Trusts:
The category  collective investment schemes  (CISs) applies to securities  unit trusts,  property unit trusts, and exchange traded funds  (ETFs).  It will be recalled that in many countries there are two main types of CISs: Securities unit trusts SUTs, and Property unit trusts PUTs
Securities Unit Trusts: intermediate almost solely  between the household sector  on the one hand and ultimate  borrowers (the  corporate and government  sectors) and  financial intermediaries  (mainly banks) on the other. Their assets are made up of almost all the securities of the corporate and government sectors (such as shares,  bonds, treasury bills) and bank  liabilities.
Property Unit Trusts: differ from the Securities unit trusts in that they are closed funds (i.e. their investment portfolio is  fixed on property development). They intermediate mainly  between the household  sector and pension funds, on  the one  hand, and  the corporate  sector on  the  other hand  (i.e. the  borrowers of  funds for property developments).
Alternative Investments:
In many countries another category of financial intermediary has emerged over the past number of years: alternative investments comprised of  private equity funds and hedge funds.
Hedge funds:  accept funds from certain  high net worth  individuals, foreign sector investors,  and contractual intermediaries in  the shape mainly of retirement  funds. They are investors in the corporate and government sectors and have derivatives margin  balances.
Private equity funds: They are large funds and invest in private equity, i.e. non-listed companies that they often “nurse” back to health (and listed companies that they delist, restructure, and list again).

C. Quasi-Financial Intermediaries:

It will be recalled that there are a number of institutions and funds that border on being classifed as financial intermediaries.
These institutions do  not borrow and/or  lend to the same  extent as the mainstream  intermediaries, or are not ongoing lenders and borrowers,  i.e. they tend to have liability and asset  financial portfolios that tend to be static
.
Development Finance Institutions:
These generally  intermediate  between ultimate  lenders  and fnancial  institutions  on  the one  hand  and mainly domestic  ultimate borrowers on  the other. 
The domestic ultimate  borrowers are  comprised of the household  sector  (mainly housing  loans and  small business  loans to  them), the  corporate sector (Mortgage loans and shares) and the government sector  (loans to local  authorities). E.g. Development Bank of Africa
Finance companies:
Finance themselves by share  capital and loans in various forms (from banks or other companies).
Their assets are  loans in various forms to  the household and corporate sectors. E.g. Housing Finance Company
Credit union: The business of a credit union, known also as a savings and credit cooperative (SACCO) is similar to  that of a bank, but  with the diference that it  is a co-operative institution. The essence  of its business is that of buying and selling money within a group of people who work in the same place or  who are members of the same community  (i.e. have a common bond). E.g. Mwalimu Sacco, Unaitas Sacco.
Micro-lenders: lend exclusively to  the household sector. On the liability side  of their balance sheets they are funded from own capital (i.e. from the  household sector) and loans (from the household sector and from the corporate sector). E.g. Shy-locks

FUNCTIONS OF FINANCIAL INTERMEDIARIES

. Economic functions of financial intermediaries
As noted, the financial  intermediaries essentially metamorphose the unacceptable claims on  borrowers into acceptable claims on  themselves. From this a number  of benefits for the economy arise:

1..Facilitation of flow of funds:

In essence,  financial intermediaries facilitate  the flow  of funds from  surplus economic  units to deficit economic units. Without sound financial intermediaries, much of the savings of the ultimate lenders will not be available to the ultimate borrowers.

This function may also be described as a savings and wealth storage function, i.e. surplus economic units have an  outlet  for their  funds and  are  thus able  to store  (preserve)  their wealth  in low-risk  (certain non-government securities) or risk-free (government  securities) or even risky (other non-government) financial instruments.
2.
Effcient allocation of funds
Financial intermediaries have the expertise to ensure that the flow of funds is allocated in the most efficient manner.
Intermediaries, particularly the  banks, are  aware of  the existence  of asymmetric  information and its two by-products, the  problems of adverse selection and moral hazard.

Asymmetric information means that the potential borrower has more information than the bank does about his/her business.
Adverse selection means that  bad risk borrowers are more  likely to want loans than  good risk borrowers.
  Moral hazard purports that once a loan is granted the borrower may be  inclined to take risks with the money that are not disclosed to the bank  in the application.
They thus ensure that available funds are allocated to borrowers that are expected to utilise the funds prudently, which in turn leads to an increase in economic activity.

3. Assistance in price discovery

Closely allied  with efficient  allocation of funds  is price discovery. 
The financial  intermediaries are the professionals on the financial  system, and are therefore keenly involved in price discovery. They are actively involved in the pricing of financial services and securities.

The central bank plays a major role in this regard via  its monetary policy.
As this is implemented via the banking sector, this sector  also plays a major role in the discovery  of interest rates.
Certain  institutions  also play  a  major  role  in the  discovery  of  other  asset  prices.
For  example, fund managers that manage pension funds are active in  differentiating between the market price and the  fair value of  equities, and influence the  pricing of equities via  their actions of either buy or sell in  the equity market.

4.
Money creation
This function may  also be  termed the bank loan/credit  function, because  it is this  action of  banks that  creates money  in the form  of new deposits.
Not only  are existing funds allocated  efficiently, but new  loans are allocated efficiently by the banking sector.
They  have the  unique ability  to create  money provided of course that the central bank assists in the process through the supply of borrowed cash reserves to the  banks.

The banks may thus be seen as the intermediaries that ease the constraint of income on expenditure, thereby enabling the consumer to spend in anticipation of income and the entrepreneur to easily acquire physical capital. 
These activities  are crucial  in terms  of output  and employment growth.

5. Enhanced liquidity for lender
If an individual purchases the securities of  the ultimate borrower  (such as making  a loan to  a company), liquidity is zero until maturity of the loan. Intermediaries purchase less or non-marketable indirect securities, and offer liquid investments to  the ultimate lenders.

A good example  is the banking  sector that makes non-marketable  securities such as  mortgages, leases and instalment credit contracts, and finances these by offering products that are immediately “cashable” such as current accounts and savings  accounts.

6. Price risk lessened for the ultimate lender

Financial  intermediaries take on price  risk and offer products  that have little or zero price risk. An example is an insurer that has a portfolio of shares and bonds that involve substantial price  risk, but offers products that have zero  price risk, such as guaranteed annuities.

Another fine  example is banks  that have  a diverse portfolio  that includes  price-sensitive bonds, loans and share/equity investments, and offer products that  have zero price risk such  as fixed deposits to depositors.

7. Improved diversification for lender

Members of  the household sector (i.e.  ultimate lenders) usually  have a smaller  wealth size and  can therefore only  achieve limited diversification compared  to a  financial intermediary  that aggregates  small amounts  for investment in the securities of the ultimate borrowers.
Thus, an individual has limited diversification possibilities and therefore carries a higher risk level than financial intermediaries, which are able to hold a wide variety of investments.
The central doctrine of portfolio theory (and practice) is that risk is reduced as the number of securities in a portfolio is increased.

8.Economies of scale
Because of the sheer  scale of financial intermediaries compared with individual participants, a number of economies are achieved. Two main economies are realised: Transactions costs and Research costs.

Transaction Costs:
The  largest  benefit  of  financial  intermediation  is  the  reduction  in  transactions  costs.
Even more important is  payment system costs.  The banking system,  through the use  of sophisticated technology, provides an efficient  payments service
(cheque clearing,  EFTs, ATM withdrawals, etc.) that  is relatively inexpensive.
Individual participants in the financial system cannot achieve this reduction in transactions costs.
Research Costs:
Another benefit is in terms of research costs. An individual holder of a diversified portfolio of shares has the task of monitoring the performance of each company,  which involves economic  analysis, industry analysis, ratio analysis, etc.
Financial  intermediaries do have the resources to  carry out research, which essentially benefits the holders of its products. A good example  is the retirement fund.  The retirement fund  member has a “share” or “participation interest” in the  portfolio of the fund, and  the fund has the resources to research  the investments on behalf of  the many members.

9.Payments system
The financial system (speciffically the banking sector) provides the mechanism for the making of payments for anything that  is purchased (goods, services,  securities).
Certain financial assets  serve as a means of payment and purchases are settled efficiently. The financial assets that are  accepted as a means of  payment (i.e. money) are: Bank notes and coins , and Bank deposits [transferred by cheques, credit cards, debit cards, EFTs etc.].

10. Risk alleviation
Certain financial  intermediaries are in  the business of offering protection against adverse occurrences such as untimely death, health problems, damage to property and loss of income.
In addition, the financial system allows for self-insurance, i.e. the storage and building of wealth in order to protect against adverse life, property and income  occurrences.

FINANCIAL INTERMEDIARIES

Financial Intermediaries.
Financial  intermediaries evolved  over many  years  to perform  the  financial-related functions  desired by the  four sectors  of the economy:  household, corporate,  government and  foreign sectors. However, some of them have been legislated  into being, such as the central bank.

Financial Intermediation
Income does not usually match expenditure; therefore surplus and deficit economic units exist. Given their  existence, which amounts to  a supply of  and a demand  for loanable funds,  some financial conduit is necessary  if the excess funds of surplus  units are to be transferred  to deficit units. The needs of these  units may  be reconciled  either through direct  financing or  indirect financing,  i.e. through the interposition of financial intermediaries.

Direct financing
This involves the bringing together of lenders and borrowers. However, a clash of  interests  exists between borrowers and lenders, and it is therefore rare that the ultimate lenders and borrowers are able to meet in order to consummate a deal. This is so because lenders tend to require investments (instruments / securities) that differ from those that  borrowers prefer to issue, and  the differences involve characteristics  such as size, term to maturity,  quality,  liquidity, etc. Borrowers  generally require  accommodation on terms differing from those  which lenders are willing or able to grant.

Financial intermediaries
Financial intermediaries performing indirect financing, assist in resolving this conflict between lenders  and  borrowers by  creating  markets  in  two types  of  financial  instruments,  i.e.  one type  for borrowers and another for lenders. They offer claims against themselves, customised to satisfy the needs (in terms of characteristics of instruments) of the lenders, in turn acquiring claims on the borrowers. The former claims are usually referred to as indirect securities and the latter as  primary securities.

The financial intermediaries receive a fee, represented by the difference between the cost of the indirect securities they issue and the revenue  earned  from the primary  securities they purchase(interest, dividends, capital gains).  In the case  of banks this is  called the margin.

ROLE OF INDUSTRIES IN ELECTRONIC WASTE MANAGEMENT

Responsibility and Role of industries
1. Generators of wastes should take responsibility to determine the output characteristics of wastes and if hazardous, should provide management options.

2. All personnel involved in handling e-waste in industries including those at the policy, management, control and operational levels, should be properly qualified and trained. Companies can adopt their own policies while handling e-wastes..
For  example.,, *Use label materials to assist in recycling (particularly plastics).
*Standardize components for easy disassembly.
Re-evaluate 'cheap products' use, make product cycle 'cheap' and so that it has no inherent value that would encourage a recycling infrastructure.
Create computer components and peripherals of biodegradable materials.
Utilize technology sharing particularly for manufacturing and de manufacturing. Encourage / promote / require green procurement for corporate buyers. Look at green packaging options.

3.
Companies can and should adopt waste minimization techniques, which will make a significant reduction in the quantity of e-waste generated and thereby lessening the impact on the environment.
It is a "reverse production" system that designs infrastructure to recover and reuse every material contained within e-wastes metals such as lead, copper, aluminum and gold, and various plastics, glass and wire.
Such a "closed loop" manufacturing and recovery system offers a win-win situation for everyone, less of the Earth will be mined for raw materials, and groundwater will be protected, researchers explain.

4. Manufacturers, distributors, and retailers should undertake the responsibility of recycling/disposal of their own products.

5. Manufacturers of computer monitors, television sets and other electronic devices containing hazardous materials must be responsible for educating consumers and the general public regarding the potential threat to public health and the environment posed by their products.
At minimum, all computer monitors, television sets and other electronic devices containing hazardous materials must be clearly labeled to identify environmental hazards and proper materials management .

Responsibilities of the citizens

. Responsibilities of the Citizen Waste prevention is perhaps more preferred to any other waste management option including recycling.
1.
Donating electronics for reuse extends the lives of valuable products and keeps them out of the waste management system for a longer time. But care should be taken while donating such items i.e. the items should be in working condition. Reuse, in addition to being an environmentally preferable alternative, also benefits society. By donating used electronics, schools, non-profit organizations, and lower-income families can afford to use equipment that they otherwise could not afford.

2.Careful  disposal of waste.
E-wastes should never be disposed with garbage and other household wastes.
This should be segregated at the site and sold or donated to various organizations.
3.proper  selection of  products before  buying.

While buying electronic products opt for those that: are made with fewer toxic constituents use recycled content are energy efficient are designed for easy upgrading or disassembly utilize minimal packaging offer leasing or take back options have been certified by regulatory authorities.

4.Customers should opt for upgrading their computers or other electronic items to the latest versions rather than buying new equipments. NGOs should adopt a participatory approach in management of e-wastes.

ELECTRONIC AND SOLID WASTE MANAGEMENT. MANAGING ELECTRONIC WASTE

MANAGEMENT OF E-WASTES

It is estimated that 75% of electronic items are stored due to uncertainty of how to manage it. These electronic junks lie unattended in houses, offices, warehouses etc. and normally mixed with household wastes, which are finally disposed off at landfills. This necessitates implementable management measures.

In industries management of e-waste should begin at the point of generation.
This can be done by waste minimization techniques and by sustainable product design. Waste minimization in industries involves adopting:
* inventory management
* production-process modification
* volume reduction
* recovery and reuse.

               1.Inventory management
Proper control over the materials used in the manufacturing process is an important way to reduce waste generation (Freeman, 1989). By reducing both the quantity of hazardous materials used in the process and the amount of excess raw materials in stock, the quantity of waste generated can be reduced.
This can be done in two ways:
*Establishing material-purchase review and control procedures and inventory tracking system.
Developing review procedures for all material purchased is the first step in establishing an inventory management program. Procedures should require that all materials be approved prior to purchase.
In the approval process all production materials are evaluated to examine if they contain hazardous constituents and whether alternative non-hazardous materials are available.
*. Ensure that only the needed quantity of a material is ordered.
This will require the establishment of a strict inventory tracking system.
.
         Purchase procedures.
They must be implemented which ensure that materials are ordered only on an as-needed basis and that only the amount needed for a specific period of time is ordered.
Production-process modification Changes can be made in the production process, which will reduce waste generation.
This reduction can be accomplished by changing the materials used to make the product or by the more efficient use of input materials in the production process or both. Potential waste minimization techniques can be broken down into three categories: i) Improved operating and maintenance procedures, ii) Material change and iii)Process-equipment modification. Improvements in the operation and maintenance of process equipment can result in significant waste reduction. This can be accomplished by reviewing current operational procedures or lack of procedures and examination of the production process for ways to improve its efficiency.
Instituting standard operation procedures can optimise the use of raw materials in the production process and reduce the potential for materials to be lost through leaks and spills.
A strict maintenance program, which stresses corrective maintenance, can reduce waste generation caused by equipment failure.
*3.
An employee-training program is a key element of any waste reduction program.
Training should include correct operating and handling procedures, proper equipment use, recommended maintenance and inspection schedules, correct process control specifications and proper management of waste materials.
4.
Hazardous materials used in either a product formulation or a production process may be replaced with a less hazardous or non-hazardous material.
This is a very widely used technique and is applicable to most manufacturing processes. Implementation of this waste ­reduction technique may require only some minor process adjustments or it may require extensive new process equipment.
For example, a circuit board manufacturer can replace solvent-based product with water-based flux and simultaneously replace solventvapor degreaser with detergent parts washer.
5.
Installing more efficient process equipment or modifying existing equipment to take advantage of better production techniques can significantly reduce waste generation.
New or updated equipment can use process materials more efficiently producing less waste. Additionally such efficiency reduces the number of rejected or off-specification products, thereby reducing the amount of material which has to be reworked or disposed of.
Modifying existing process equipment can be a very cost-effective method of reducing waste generation. In many cases the modification can just be relatively simple changes in the way the materials are handled within the process to ensure that they are not wasted. For example, in many electronic manufacturing operations, which involve coating a product, such as electroplating or painting, chemicals are used to strip off coating from rejected products so that they can be recoated. These chemicals, which can include acids, caustics, cyanides etc are often a hazardous waste and must be properly managed. By reducing the number of parts that have to be reworked, the quantity of waste can be significantly reduced.

6.Volume reduction .
Volume reduction includes those techniques that remove the hazardous portion of a waste from a non-hazardous portion
These techniques are usually to reduce the volume, and thus the cost of disposing of a waste material.
The techniques that can be used to reduce waste-stream volume can be divided into 2 general categories:
A. source segregation

Segregation of wastes is in many cases a simple and economical technique for waste reduction.
Wastes containing different types of metals can be treated separately so that the metal value in the sludge can be recovered.
B. Waste  concentration

Concentration of a waste stream may increase the likelihood that the material can be recycled or reused. 
Methods include gravity and vacuum filtration, ultra filtration, reverse osmosis, freeze vaporization etc.
For example, an electronic component manufacturer can use compaction equipments to reduce volume of waste cathode ray-tube.

7.
Recovery and reuse
This technique could eliminate waste disposal costs, reduce raw material costs and provide income from a salable waste.
Waste can be recovered on-site, or at an off-site recovery facility, or through inter industry exchange.
A number of physical and chemical techniques are available to reclaim a waste material such as reverse osmosis, electrolysis, condensation, electrolytic recovery, filtration, centrifugation etc.
For example, a printed-circuit board manufacturer can use electrolytic recovery to reclaim metals from copper and tin-lead plating bath.
However recycling of hazardous products has little environmental benefit if it simply moves the hazards into secondary products that eventually have to be disposed of.
Unless the goal is to redesign the product to use non­hazardous materials, such recycling is a false solution.
Sustainable product design Minimization of hazardous wastes should be at product design stage itself keeping in mind the following factors* Rethink the product design: Efforts should be made to design a product with fewer amounts of hazardous materials.
For example, the efforts to reduce material use are reflected in some new computer designs that are flatter, lighter and more integrated. Other companies propose centralized networks similar to the telephone system.
8.
Use of renewable materials and energy:
Bio-based plastics are plastics made with plant-based chemicals or plant-produced polymers rather than from petro­chemicals. Bio-based toners, glues and inks are used more frequently. Solar computers also exist but they are currently very expensive.
Use of non-renewable materials that are safer: Because many of the materials used are non-renewable, designers could ensure the product is built for re-use, repair and/or upgradeability. Some computer manufacturers such as Dell and Gateway lease out their products thereby ensuring they get them back to further upgrade and lease out again.

ELECTRONIC AND SOLID WASTE MANAGEMENT

"E-waste" is a popular, informal name for electronic products nearing the end of their "useful life. "E-wastes are considered dangerous, as certain components of some electronic products contain materials that are hazardous, depending on their condition and density.
The hazardous content of these materials pose a threat to human health and environment. Discarded computers, televisions, VCRs, stereos, copiers, fax machines, electric lamps, cell phones, audio equipment and batteries if improperly disposed can leach lead and other substances into soil and groundwater.
Many of these products can be reused, refurbished, or recycled in an environmentally sound manner so that they are less harmful to the ecosystem.
This paper highlights the hazards of e-wastes, the need for its appropriate management and options that can be implemented.

INTRODUCTION

Industrial revolution followed by the advances in information technology during the last century has radically changed people's lifestyle. Although this development has helped the human race, mismanagement has led to new problems of contamination and pollution.
The technical prowess acquired during the last century has posed a new challenge in the management of wastes.
For example, personal computers (PCs) contain certain components, which are highly toxic, such as chlorinated and brominated substances, toxic gases, toxic metals, biologically active materials, acids, plastics and plastic additives. The hazardous content of these materials pose an environmental and health threat.
Thus proper management is necessary while disposing or recycling e­wastes.
These days computer has become most common and widely used gadget in all kinds of activities ranging from schools, residences, offices to manufacturing industries.
E-toxic components in computers could be summarized as circuit boards containing heavy metals like lead & cadmium; batteries containing cadmium; cathode ray tubes with lead oxide & barium; brominated flame­retardants used on printed circuit boards, cables and plastic casing; poly vinyl chloride (PVC) coated copper cables and plastic computer casings that release highly toxic dioxins & furans when burnt to recover valuable metals; mercury switches; mercury in flat screens; poly chlorinated biphenyl's (PCB's) present in older capacitors; transformers; etc. Basel Action Network (BAN) estimates that the 500 million computers in the world contain 2.87 billion kgs of plastics, 716.7 million kgs of lead and 286,700 kgs of mercury. The average 14-inch monitor uses a tube that contains an estimated 2.5 to 4 kgs of lead. The lead can seep into the ground water from landfills thereby contaminating it. If the tube is crushed and burned, it emits toxic fumes into the air.

EFFECTS ON ENVIRONMENT AND HUMAN HEALTH

1.
Disposal of e-wastes is a particular problem faced in many regions across the globe. Computer wastes that are landfilled produces contaminated leachates which eventually pollute the groundwater.
2.
Acids and sludge obtained from melting computer chips, if disposed on the ground causes acidification of soil.
For example, Guiyu, Hong Kong a thriving area of illegal e-waste recycling is facing acute water shortages due to the contamination of water resources.
This is due to disposal of recycling wastes such as acids, sludges etc. in rivers.
Now water is being transported from faraway towns to cater to the demands of the population.
3.
Incineration of e-wastes can emit toxic fumes and gases, thereby polluting the surrounding air. Improperly monitored landfills can cause environmental hazards. Mercury will leach when certain electronic devices, such as circuit breakers are destroyed. The same is true for polychlorinated biphenyls (PCBs) from condensers. When brominated flame retardant plastic or cadmium containing plastics are landfilled, both polybrominated dlphenyl ethers (PBDE) and cadmium may leach into the soil and groundwater. It has been found that significant amounts of lead ion are dissolved from broken lead containing glass, such as the cone glass of cathode ray tubes, gets mixed with acid waters and are a common occurrence in landfills.
4.vaporization of  metallic  mercury.
Not only does the leaching of mercury poses specific problems, the vaporization of metallic mercury and dimethylene mercury, both part of Waste Electrical and Electronic Equipment (WEEE) is also of concern..
5. Uncontrolled  fires  may  arise  in  landfill.

In addition, uncontrolled fires may arise at landfills and this could be a frequent occurrence in many countries. When exposed to fire, metals and other chemical substances, such as the extremely toxic dioxins and furans (TCDD tetrachloro dibenzo-dioxin, PCDDs-polychlorinated dibenzo­dioxins. PBDDs-polybrominated dibenzo-dioxin and PCDFs­poly chlorinated dibenzo furans) from halogenated flame retardant products and PCB containing condensers can be emitted.

6.Toxic fallout  from  open  air  burning.
The most dangerous form of burning e-waste is the open-air burning of plastics in order to recover copper and other metals.
The toxic fall-out from open air burning affects both the local environment and broader global air currents, depositing highly toxic by products in many places throughout the world. 
7.The health effects of certain constituents in e-wastes.
If these electronic items are discarded with other household garbage, the toxics pose a threat to both health and vital components of the ecosystem. In view of the ill-effects of hazardous wastes to both environment and health.

Realization definition

This  is  the  conversion of assets, goods or  services into  cash or  receivable through  sale

Accounting in the realization account of partnership businesses in cases of dissolution

NOTE;
All assets except cash and bank balance and those assets which are taken over by partners are transferred to the Debit side of Realisation A/c.
Similarly all liabilities except which are taken over by partners (excluding free reserves) are transferred to the credit side of Realisation A/c. Actually Realisation A/c is a Nominal A/c. This account is prepared to calculate the profit/loss made on realisation of assets and settlement of liabilities.
If this account was not prepared then on selling every asset you would have made entry in every asset account and transferred the profit/loss on that transaction to some separate account kept for calculating profit/loss on realisation of assets and settlement of liabilities. Similarly while settling every liability you would have made entry in each liability and transferred profit/loss to the same account meant for calculating profit/loss on realisation of assets and settlement of liabilities. From what has been stated above you would realise that it would mean a lot of work which reduces significantly by preparing Realisation A/c and you get to know profit/loss made during the process of realisation of assets and settlement of liabilities at one place.

MARKET EFFICIENCY AND TYPES OF MARKET EFFICIENCY

Market Efficiency

Market Efficiency
Definition :market  efficiency refers to the degree to which the aggregate decisions of all the market's participants accurately reflect the value of public companies and their common shares at any moment in time.
This requires determining a company's intrinsic value and constantly updating those valuations as new information becomes known
. The faster and more accurate the market is able to price securities, the more efficient it is said to be.
. Definition  of Efficient Market Hypothesis:

This is an investment theory that states it is impossible to "beat the market" because stock market efficiency causes existing share prices to always incorporate and reflect all relevant information. According to the EMH, stocks always trade at their fair value on stock exchanges, making it impossible for investors to either purchase undervalued stocks or sell stocks for inflated prices. As such, it should be impossible to outperform the overall market through expert stock selection or market timing, and that the only way an investor can possibly obtain higher returns is by purchasing riskier investments.

TYPES  OF  MARKET  EFFICIENCY.

Eugene Fama identified three levels of market efficiency:
1.Weak-form efficiency:
Prices of the securities instantly and fully reflect all information of the past prices.
This means future price movements cannot be predicted by using past prices.
It is simply to say that, past data on stock prices are of no use in predicting future stock price changes.
Everything is random. In this kind of market, should simply use a "buy-and-hold" strategy.

2.Semi-strong efficiency:

Asset prices fully reflect all of the publicly available information.
Therefore, only investors with additional inside information could have advantage on the market.
Any price anomalies are quickly found out and the stock market adjusts.

3.Strong-form efficiency:

Asset prices fully reflect all of the public and inside information available.
Therefore, no one can have advantage on the market in predicting prices since there is no data that would provide any additional value to the investors.

Price discovery

Price  discovery is  the  determination or  making of  the  price of equity and  the  price  of  debt  security in  the  market

ANGELA CHIBALONZA JINA LA YESU LYRICS

Jina la Yesu limeniponya maisha,
Jina la Yesu,limenisamehe dhambi,
Jina la Yesu limenitoa katika mikono ya ibilisi!

Verse 1;
Nililiita jina la Yesu nikapata uzima,
kanitoa matesoni akaniokoa,
na sasa naimba kwa utukufu wake,
Roho wake amenijaza sasa niko Huru,
Hu-u-u-ru!

Chorus.

  Jina la Yesu limeniponya maisha,
Jina la Yesu,limenisamehe dhambi,
Jina la Yesu limenitoa katika mikono ya ibilisi!

Verse 2.
Nilipokua katika shida, sikuona rafiki,
Magonjwa na shida yakanisumbua,
masoma ya watoto nikashindwa kulipa,
Hata pesa za nyumba nikashindwa kulipa, Marafiki kanikimbia sababu ya shida,
Nilipo ita jina la Yesu nikapata msaada, Nilisongea akanipa, sasa nafurahi,
furahi-i-I katika Bwana Yesu

Chorus :
Jina la Yesu limeniponya maisha,
Jina la Yesu,limenisamehe dhambi,
Jina la Yesu limenitoa katika mikono ya ibilisi! Jina la Yesu limeniponya maisha,
Jina la Yesu,limenisamehe dhambi,
(ou ou ou)
Jina la Yesu limenitoa katika mikono ya ibilisi!

Verse 3:
Sasa nafurahia, kuishi pamoja naye,
tangu nilipo okoka maisha imebadilika,
Na safari yangu, naelekea mbingu-u-uni

Chorus
Jina la Yesu limeniponya maisha,
Jina la Yesu,limenisamehe dhambi,
Jina la Yesu limenitoa katika mikono ya ibilisi! Jina la Yesu limeniponya maisha,
Jina la Yesu,limenisamehe dhambi, Jina la Yesu limenitoa katika mikono ya ibilisi!

Verse 1

(repeat)
Nililiita jina la Yesu nikapata uzima,
kanitoa matesoni akaniokoa,
na sasa naimba kwa utukufu wake,
Roho wake amenijaza sasa niko huru,
Hu-u-u-ru!

Chorus; Jina la Yesu limeniponya maisha,
Jina la Yesu,limenisamehe dhambi,
Jina la Yesu limenitoa katika mikono ya ibilisi!

MAJOR Reasons why people join groups

a.
PROXIMITY, INTERACTION AND  INFLUENCE
One of the most common reasons why people join groups is because they work near each other.
Informal groups seem to form among those     who are in close proximity.
  When people have frequent interaction or              contact with one another, there is likelihood
that they will form a group.
Finally, if the behaviour of one individual influences that of others, they are likely to form a group.

b. Security:
Probably the strongest reason to join the group is the need for security.
By joining a group we can reduce our insecurity – we feel stronger.
New or experienced, no employee likes to stay alone.
We derive reassurance from interacting with others and being part of a group.
This often explains the appeal of unions – if management creates an environment in which employees feel insecure, they are likely to turn to unionization in order to reduce their feelings of insecurity.

c. Esteem:
An individual can increase his self-esteem through group membership.
One may gain esteem by becoming a member of a high status group.
Associating with high status people is reinforcing.

d. Power:
Membership of groups offers power to members in at least two ways.
First, there are sayings such as “United we stand, divided we fall” and “there is strength in number.”
Secondly, leadership of an informal group enables an individual to use power over group members, even if he does not enjoy a formal position of authority in the organization.

5.NEED  FOR  AFFLIATION :
in  order  to  have  a  sense  of belonging  to  certain  people.

6.To  achieve  some  common  goals.
According  to  Jennifer  and  Gareth people  interact  with  each  other  to  achieve  certain  goals  or  to  meet  certain  needs

ADVANTAGES AND DISADVANTAGES OF BEHAVIOURISM

CRITICISM  OF BEHAVIOURISM

1. BEHAVIOURISM  IS  A ONE  DIMENSIONAL APPROACH:
Many critics argue that behaviorism is a one-dimensional approach to understanding human behavior and that behavioral theories do not account for free will and internal influences such as moods, thoughts, and feelings.
2.BEHAVIOURISM  FAILS  TO  ACCOUNT  FOR  OTHER  TYPES  OF  LEARNING :
Behaviorism does not account for other types of learning, especially learning that occurs without the use of reinforcement and punishment.
3.People and animals are able to adapt their behavior when new information is introduced, even if a previous behavior pattern has been established through reinforcement.

STRENGTHS  OF  BEHAVIOURISM

1.BASED  ON  OBSERVABLE  CHARACTERISTICS :
Behaviorism is based upon observable behaviors, so it is easier to quantify and collect data and information when conducting research.
2.Effective therapeutic techniques such as intensive behavioral intervention, behavior analysis, token economies, and discrete trial training are all rooted in behaviorism. These approaches are often very useful in changing maladaptive or harmful behaviors in both children and adults.

SIX CORE INFLUENCERS OF BEHAVIOUR IN PERSONALITY FORMATION

Behavioralism and learning Theories

Evolutionary Psychology
This  is  the  study of evolution of behavior and the mind
It uses the principle of natural selection by Darwin’s principle.
Darwin  theory  States  that those traits contributing to the survival of the species will most likely be passed on to the next generation.

It  further  States Survival of the generation will rely on their competence to survive in changing environment.

The six core  influences on behavior of individual include:

1.Early Brain Development: 
   Early experience is critical in brain   development.
In later life continued use is necessary to maintain neural connections in the brain.

2.Peer Influence:
Peer influence in adolescence development may play very powerful role.
Many studies suggest a peer group behavior is correlated with one’s school performance, smoking, and other habits.
3.Culture :
These  are Shared attitudes, beliefs, norms and behaviors of a group, may be in a family .

culture represents  peoples  way  of  life.

Culture is communicated from one generation      to the next.
The way how a system has been operating over the period is culture.
4.Norms:
Rules for accepted and expected behavior understood in a defined context.
Norms consist of the “proper behavior”within a group.
5.Individualism:
Giving priority to one’s goals over thegoals of the group.
Defining one’s identity in terms of personal attributes rather than the group’s identification.  Individualism tend to see people as separate and independent
6.Collectivism:
  Giving priority to the goals of one’s groupover one’s personal goals.
  Defining one’s identity in terms of the group’s identification rather than personal attributes
Collectivism  Sees people as connected to others.
  Individual needs are sacrificed for the goodness of the group.

POWERS OF THE NATIONAL TREASURY

Powers of the National Treasury

1.The Cabinet Secretary may generally give to the National Treasury such powers as are necessary
to facilitate the Cabinet Secretary and national government to exercise their powers in the .
With prior notification to the entity, access any system of public financial management
and control of national government entity;
2.
where reasonably necessary in the execution of its functions, access the premises of any
national State Organ or other public entity and inspect the entity's records and other
documents relating to financial matters after giving notice;
3.
require national government entities to comply with any specified applicable norms or standards regarding accounting practices and budget classification systems;
4.
require any public officer in the national government to provide information and if
necessary, explanations with respect to matters concerning public finance:
Provided that a person providing information shall not be liable if at the time of providing
the information that person, in writing, objected to providing such information on
grounds that the information may incriminate him or her;
5.
Provide any County Treasury with any information as it may require to carry out its
responsibilities under the Constitution; and
6.
Perform any other act as the Cabinet  Secretary  may  set

RESPONSIBILITIES OF NATIONAL TREASURY IN KENYA

formulate, implement and monitor macro-economic policies involving expenditure and
revenue;
2.
manage the level and composition of national public debt, national guarantees and other
financial obligations of national government within the framework of this Act and
develop a framework for sustainable debt control;
3.
formulate, evaluate and promote economic and financial policies that facilitate social and
economic development in conjunction with other national government mobilize domestic and external resources for financing national and county government
budgetary requirements;
5.
design and prescribe an efficient financial management system for the national and
county governments to ensure transparent financial management and standard financial
reporting as contemplated by Article 226 of the Constitution:
6.
Provided that the National Treasury shall prescribe regulations that ensure that operations
of a system under this paragraph respect and promote the distinctiveness of the n consultation with the Accounting Standards Board, ensure that uniform accounting
standards are applied by the national government and its entities;
8.
develop policy for the establishment, management, operation and winding up of public
funds;
9.
within the framework of this Act and taking into consideration the recommendations of
and county levels of government; e Commission on Revenue Allocation and the Intergovernmental Budget and Economic
Council, prepare the annual Division of Revenue Bill and the County Allocation of
Revenue Bill;
10. strengthen financial and fiscal relations between the national government and county
governments and encourage support for county governments in terms of Article 190(1) of
the Constitution in performing their functions; and
11. Assist county governments to develop their capacity for efficient, effective and
transparent financial management in consultation with the Cabinet Secretary responsible
for matters relating to intergovernmental relations.

Contents of development plans.. Public finance

Every county government shall prepare a development plan in accordance with Article 220(2) of
the Constitution, that includes—

a. strategic priorities for the medium term that reflect the county government's priorities and
plans;
b. a description of how the county government is responding to changes in the financial and
economic environment;
c. programmes to be delivered with details for each programme of—
i. the strategic priorities to which the programme will contribute;

BUDGET PROCESS BY COUNTY AND NATIONAL GOVERNMENT IN KENYA

tages in county government budget process

The budget process for county governments in any financial year shall consist of the following
stages—

a. integrated development planning process which shall include both long term and medium
term planning;
b. planning and establishing financial and economic priorities for the county over the
medium term;
c. making an overall estimation of the county government's revenues and expenditures;
d. adoption of County Fiscal Strategy Paper;
e. preparing budget estimates for the ounty government and submitting estimates to the
county assembly;
f.
approving of the estimates by the county assembly;
g. enacting an appropriation law and any other laws required to implement the county
government's budget;
h. implementing the county government's budget; and
i.
accounting for, and evaluating, the county government's budgeted revenues and
expenditures;
The County Executive Committee member for finance shall ensure that there is public
participation in the budget process.

Process of developing County government finance bill

PROCESS OF DEVELOPING COUNTY GOVERNMENT FINANCE BILL

County Treasury to prepare County Fiscal Strategy Paper

The County Treasury shall prepare and submit to the County Executive Committee the County
Fiscal Strategy Paper for approval and the County Treasury shall submit the approved Fiscal
rategy Paper to the county assembly, by the 28th February of each year.

The County Treasury shall align its County Fiscal Strategy Paper with the national objectives in
the Budget Policy Statement.

In preparing the County Fiscal Strategy Paper, the County Treasury shall specify the broad
strategic priorities and policy goals that will guide the county government in preparing its budget
for the coming financial year and over the medium term. he County Treasury shall include in its County Fiscal Strategy Paper the financial outlook with
respect to county government revenues, expenditures and borrowing for the coming financial
year and over the medium term.

In preparing the County Fiscal Strategy Paper, the County Treasury shall seek and take into
account the views of—

a) the Commission on Revenue Allocation;
b) the public;
c) any interested persons or groups; and
d) any other forum that is established by legislation. ot later than fourteen days after submitting the County Fiscal Strategy Paper to the county
assembly, the county assembly shall consider and may adopt it with or without amendments.

The County Treasury shall consider any recommendations made by the county assembly when
finalising the budget proposal for the financial year concerned.

The County Treasury shall publish and publicise the County Fiscal Strategy Paper within seven
days after it has been submitted to the county assembly.

County Treasury to prepare a County dget Review and Outlook Paper

A County Treasury shall—

a) prepare a County Budget Review and Outlook Paper in respect of the county for each
financial year; and
b) Submit the paper to the County Executive Committee by the 30th September of that year.

In preparing its county Budget Review and Outlook Paper, the County Treasury shall specify—

a) the details of the actual fiscal performance in the previous year compared to the budget
appropriation for that year;
b) the updated economic and financial orecasts with sufficient information to show changes
from the forecasts in the most recent County Fiscal Strategy Paper;
c) information on—

i. any changes in the forecasts compared with the County Fiscal Strategy Paper

ii.
how actual financial performance for the previous financial year may have affected
compliance with the fiscal responsibility principles, or the financial objectives in the
County Fiscal Strategy Paper for that financial year; and
easons for any deviation from the financial objectives in the County Fiscal Strategy
Paper together with proposals to address the deviation and the time estimated for doing
so.

The County Executive Committee shall consider the County Budget Review and Outlook Paper
with a view to approving it, with or without amendments, within fourteen days after its
submission.

Not later than seven days after the County Budget Review and Outlook Paper is approved by the
County Executive Committee, the County Treasury shall— rrange for the Paper to be laid before the County Assembly; and

b)
as soon as practicable after having done so, publish and publicise the Paper.

Banking arrangements for county government and its entities

The County Treasury is responsible for authorising the opening, operating and closing of bank
accounts for the county government and its entities, except as otherwise provided by other
legislation and in accordance with regulations made under this Act. s soon as practicable, each County Treasury shall establish a Treasury Single Account at the
Central Bank of Kenya or a bank approved by the County Treasury through which payments of
money to and by the various county government entities are to be made.

The Treasury Single Account shall not be operated in a manner that prejudices any entity to
which funds have been disbursed.

An accounting officer for a county government entity shall not cause a bank account of the entity
to be overdrawn beyond the limit authorised by the County Treasury or a Board of a county
government entity, if any. County Treasury shall keep complete and current records of all bank accounts for which it is
responsible under the Constitution, this Act or any other legislation.

Criteria to be taken in to account when determining the equitable shares in national and county legislation

The following criteria shall be taken into account in determining the equitable shares provided
for under Article 202 and in all national legislation concerning county government enacted in
terms of this Chapter—

i.
the national interest;

ii.
any provision that must be made in respect of the public debt and other obligations

iii.
the needs of the national government, determined by objective criteria;

iv.
the need to ensure that county governments are able to perform the functions
allocated to them;
v.
the fiscal capacity and efficiency of county governments;

vi.
developmental and other needs of counties;

vii.
economic disparities within and among counties and the need to remedy them;

PRINCIPLES of public finance

PRINCIPLES OF PUBLIC FINANCE

The following principles shall guide all aspects of public finance in the Republic—
1.There shall be openness and accountability, including public participation in financial
matters;

2. The public finance system shall promote an equitable society, and in particular—
i.
the burden of taxation shall be shared fairly;
ii.
revenue raised nationally shall be shared equitably among national and county
governments; and
iii.
expenditure shall promote the equitable development of the country, including by making
special provision for marginalised groups

3.
The burdens and benefits of the use of resources and public borrowing shall be shared
equitably between present and future generations;
4.
public money shall be used in a prudent and responsible way; and
5.
financial management shall be responsible, and fiscal reporting shall be clear
Equitable sharing of national revenue

Revenue raised nationally shall be shared equitably among the national and county governments.

County governments may be given aditional allocations from the national government’s share of the revenue, either conditionally or unconditionally.

Ways of managing earnings . Esther Nyamai

manager can manage its earnings through various techniques which are:

i. Timing sales of securities that have gained value: The company can sell a portfolio security that has an unrealized gain and can report the gain as operating earnings if it is required

ii. Timing sales of securities that have lost value: If the manager wants to show lower earnings then he can sell the security that has an unrealized loss and report the loss in operating earnings.

iii. Change of holding intent, write-down “impaired securities

Management can manage earnings through change of its holdings from available to sale securities to trading securities and vice versa. T
anage earnings through change of its holdings from available to sale securities to trading securities and vice versa. This would have the effect of moving any unrealized gain or loss on the security to or from the income statement

iv. Write-down “impaired securities: Securities that have an apparent long term decline in fair market value can be written down to the reduced value regardless of their portfolio classification. 

v. “Throw out” a problem child:
To increase the earnings of future period, the company can sell the subsidiary which is not performed well i.e. “the problem child” subsidiary may be “thrown out”. Earnings can be managed through sell the subsidiary, exchange the stock in an equity method subsidiary and spin off the subsidiary.
A gain or loss is reported in the current period statement when a subsidiary is sold.

TECHNIQUES OF EARNINGS MANAGEMENT.. ESTHER NYAMAI

. TECHNIQUES OF EARNINGS MANAGEMENT
 
Earnings management techniques  include.

i. “Cookie jar reserve” technique:
The cookie-jar technique deals with estimations of future events.  According to GAAP, management has to estimate and record obligations that will be paid in the future as a result of events or transactions in the current fiscal year based on accrual basis.
But there is always uncertainty surrounding the estimation process because future is not always certain.
There is no correct answer; there may be reasonably possible answers. 
Management has to select a single amount according to GAAP so there is a chance of taking the advantage of earnings management.  Under the cookie-jar technique, the corporation will try o overestimate expenses during the current period to manage earnings.
If and when actual expenses turn out lower than estimates, the difference can be put into the "cookie jar" to be used later when the company needs a boost in earnings to meet predictions.
examples of estimation to manage earnings  are: sales returns and allowances, estimates of bad debt and write-downs; estimating inventory write downs; estimating warranty costs; estimating pension expense; terminating pension plans and  estimating percentage of completion for long term contracts etc. 

ii. “Big Bath” Techniques:

Although a rare occurrence, sometimes corporations may restructure debt, write-down assets or change and even close down an operating segment. In these instances, expenses are generally unavoidable. If the management record estimated charge (a loss)
ainst earnings for the cost of implementing the change then it will negatively affect the cost of the share price. But the share price may go up rapidly if the charge for restructuring and related operational changes is viewed as positively. According to Big bath technique, if the manager have to report bad news i.e., a loss from substantial restructuring , it is better to report it all at once and get it out of the way. 

iii. “Big Bet on the Future” technique: 
When an acquisition occurs, the corporation acquiring the other is said to have made a big bet on the future. Under Generally Accepted Accounting Principles (GAAP) regulations, an acquisition must be reported as a purchase. This leaves two doors open for earnings management. In the first instance, a company can write off continuing R&D costs against current earnings in the acquisition year, protecting future earnings from these charges.  This means that whe he costs are actually incurred in the future, they will not have to be reported and thus future earnings will receive a boost. The second method is to claim the earnings of the recently acquired corporation. When the acquired corporation consolidated with parent company earnings, then immediately receive a boost in the current year's earnings. By acquiring another company, the parent company buys a guaranteed boost in current or future earnings through big bet technique.  

iv. “ Flushing” the investment portfolio:

To achieve strategic alliance and invest their excess funds, a company buys the shares of another company. Two forms of investment are trading securities and available for sale securities. Actual gains or losses from sales or any changes in the market value of trading securities are reported as  operating income  where as any change in market value of available for sale securities during a fiscal period is reported in “other comprehensive

Factors resulting to earnings management.. Esther Nyamai

FACTORS RESULTING TO EARNINGS MANAGEMENT.(Burgstahler, D. and I. Dichev. 1997)
a. Window dressing
Refers to the company's decision to dress up the financial statements for potential investors and creditors. The goal of window dressing r is to attract new supporters by having financial statements that look like the company is doing great. The company needs to appear to have a history of being profitable, even if it means lowering profits in the accounting period to increase profits in another. That is, spreading the amount evenly over a specific time period.

b. Internal targets
Often times, the company has set its own internal goals such as departmental budgeting and wants to be sure to meet those goals. no department wants to be the one to blow the proposed budget; so earnings management balances this out.

c. Income smoothing
It comes into play here; because potential investors like to invest in companies that have a continuous growth pattern. Smoothing out income generated, when there maybe spikes at certain times and drops at others, allow it to appear like the company has that smooth growth pattern.

d. External expectations
They come into play when the company has made projections as to what their profits would be and investors now expect that exact amount of profits or more. Management may therefore feel the need to shift revenue from one accounting period to another in order tom meet the projected goal. Earnings management, quite simply, takes advantage of the different ways that accounting policies and procedures can be applied to financial reporting.

Earning management

1. INTRODUCTION

Earnings  refers to the profits of a company which is represented by the bottom line of the income statement and a summary item in financial statements.
Importance  of  earnings  management.

1.Earnings are the vital item in financial statement because it represents to what extent the company engaged in value added activities.

2.Earnings also indicate the signal of direct resource allocation in capital market. Investors and analysts look to earnings to determine the attractiveness of a particular stock. The company’s stock is measured by the present value of its future earnings. Companies with poor earnings prospects will typically have lower share prices than those with good prospects. A company’s ability to generate profit in the future plays a very important role in determining its stock’s price.