Health Care Case Study: Financial Statements Essay

Abstract â€Å"An empowered organization is one in which individuals have the knowledge, skill, desire, and opportunity to personally succeed in a way that leads to collective organizational success,† (Covey. 2011). Financial management within a health care organization is crucial to the success and stability of the organization. In this summary financial information on Patten Fuller Hospital will be revealed. Specifically, the differences between audited and unaudited statements and reporting on the hospital’s ratios will be included. Information related to the relationship on revenue sources and expenses will include how the hospital revenues and expenses are grouped for planning and control. Audited and Unaudited Differences During the years of 2008 and 2009 the Patton-Fuller Community Hospital’s balance sheet had some differences with the patient accounts of about $1,000,000. The discrepancies between the two amounted to $1,000,000; these discrepancies would be the audited statement that equaled to $58,787,000 and the unaudited statement in 2009 that amounted to $59,787,000 (Patton-Fuller Community Hospital, 2011). Then there were discrepancies on the Statement of Revenue and Expenses of about 1,000,000 during 2009. The discrepancies between the two that amounted to $1,000,000 would be the audited statement that equaled to $14,797,000 and the unaudited statement in 2009 that amounted to $13,797,000 (Patton-Fuller Community Hospital, 2011). The net income for the audited statement is 373,000 and, the unaudited is 627,000. Effect’s of Revenue Sources on Financial Reporting A company’s revenue comes from a variety of sources, including the sales of goods interests on loans, and income from renting or leasing. Accountant’s first record revenue in informal accounting ledgers to track capital as it comes into the company. Information ledgers are transferred to more formal,  official financial statements. The income statements, balance sheets, retained earnings statements and statements of cash flows are the four basic types of financial statements affected by revenue sources. Revenues and Expenses Grouped for Planning and Control The hospitals revenues and expenditures are plans and cohesively to track revenues and expenditures efficiently. The two main categories of revenue are, nonrevenue producing, and revenue producing. The nonrevenue producing services have two subdivisions, general services, and support services. General services are services, such as maintenance, and dietary. The support services are administrative costs relate to employee services, such as salaries, and employee welfare services. Revenue producing has two groups: nursing services and other professional services. Nursing services has five cost centers ranging from the intensive care units to the operating room. Professional services have 15 cost centers, such as emergency room and pharmacy. These cost centers correlate to specific expenditure categories. Expenditure grouping is separate into two categories, diagnoses, and procedures. Most revenue in health care organizations is either diagnoses or procedures. Major diagnostic categories (MDCs) group costs with a 27-classification system for diagnosis-related groups (DRGs). Each DRG represents a category of the services for patients. This classification assigns procedures provided to patients with current procedural terminology (CPT) codes. â€Å"CPT codes represent a listing of descriptive terms and identifying codes for identifying medical services and procedures performed† (Baker & Baker, 2011, p. 44). Conclusion Discrepancies were found in three areas between the audited and unaudited statements. The differences between the statements were vast with patient accounts showing a $1,000,000 difference, the statement of revenue and expenses showing a $1,000,000 difference, and a net income difference of $254,000. Corporate revenue comes from many sources. Revenue is reported on various financial forms like income statements, balance sheets, retained  earnings statements, and cash flow statements, which are the four basic types of financial statements affected by revenue. Different categories and services exist to group revenues and expenditures into cost centers that correlate to different DRG’s. DRG’s break down the procedures into CPT codes identifying the services and procedures for compensation. Reference: Baker, J.J., & Baker, R.W. (2011). Health care finance: Basic tools for nonfinancial managers (3rd ed.).Jones & Bartlett. Covey, S. (2011). Inspirational Quotes for Business: Empowerment and Delegation. Retrieved from http://humanresources.about.com/od/workrelationships/a/quotes_empower.htm Patton-Fuller Community Hospital, (2011). Annual Report 2009. Virtual Organization Portal. Retrieved May 27, 2011 from University of Phoenix

This assignment will examine issues around social exclusion and teenage pregnancy

Q. Describe and write a critique of any ‘personal trouble' and illustrate how the key theoretical concepts raised in this class can help you explain it as a ‘public issue'. This assignment will examine issues around social exclusion and teenage pregnancy. It will explore the links between teenage pregnancy, poverty, and how it links into the underclass theory. This assignment will look at the trends in teenage pregnancy in the United Kingdom. It will focus on issues based around assumptions that teenage pregnancy is a personal trouble and a public issue and why teenage pregnancy is a problem and whom it is a problem for. I will be looking at what the government expectations of young people are and how they hope to raise the aspirations of these young people through education and training. It will examine the government policies and practices in relation to teenage pregnancy whilst critically analysing the implications that these have on teenage pregnancy. Teenage pregnancy according to figures published in S. E. U (1999) are rising dramatically and despite the introduction of compulsory sex education there doesn't seem to be anyway of stopping these figures from further rising. In England alone there are approximately 90,000 young people getting pregnant, girls under 16 account for about 7,700 of these pregnancies, and approximately 2,200 of these being under 14 years of age. Out of these pregnancies around 3/5,s go to full term and result in live births. If you explore this further the figures show that around 56,00 babies are born each year to teenage mothers. The figures suggest that there are 87,000 children living with teenage mothers in England alone. These statistics are frighteningly high and the government is aiming to halve the rate of teenage pregnancies in nder 18 year olds by the year 2010. Teenage pregnancy occurs in all classes of society but the figures show definite links between teenage pregnancy, being more prevalent in the poorer underclass, and those daughters of single mothers who themselves may have been teenage mothers. These links according to S. E. U (1999) state that ‘ socialisation and deprivation are two of the main causes of teenage pregnancy. ‘ They also state that ‘overall teenage parenthood is more common in areas of deprivation and poverty†¦ teenage pregnancy is often a cause and a consequence of social exclusion. Information collated and analysed by the S. E. U enabes us to see how they have reached their theories surrounding teenage pregnancy. It shows how they identified and linked the risk factors to teenage pregnancy and how all of these seem to have an association with the poorest category of society the `underclass`. The report by the S. E. U (1999) also shows how these risk factors can be seen in geographical concentrations, thus the teenage pregnancy map, ‘ resembles the distribution of local authorities identified as the most deprived in the unit's report on neighbourhood enewal. ‘ The map shows that the poorest areas of England have up to more than six times a higher rate of teenage pregnancies than the more affluent areas. The areas outside of London which have been identified has having the highest rates of conception amongst young people are industrial cities which are going through economic recession and ports which are suffering from loss of jobs due to the recent collapse of ship building industries. How does this then prove the government's theory that teenage pregnancy is linked to social exclusion? A list of factors relating to women in their mid-thirties who had become teenage mothers, the evidence confirms that the vast majority are low achiever's, do not work, single with many being reliant on long term benefits. As a result of this they have not had the opportunity to progress in life and has a result of this are trapped in the cycle of poverty, deprivation and social exclusion. Hence the S. E. U report say ‘teenage pregnancy is often the cause and a consequence of social exclusion †¦ overall teenage parenthood is more common in areas of deprivation and poverty'. Thus adding weight to the governments argument about teenage pregnancy being a public issue. The figures show that teenage pregnancy is a public issue; the facts show that the UK has the highest rate of teenage pregnancy in Western Europe. This is three times higher than France and nearly six times higher than Holland. Could this be down to our lack of morals? The fact remains that in Holland if you have a child in your teenage years and out of wedlock the local communities still shun you and there is a lot of social stigma attached to this. Whilst in the UK teenage pregnancy along with cohabiting has become the `norm` and are more easily accepted, with very little stigma attached to it. The law states that sex under sixteen is unlawful and young women cannot give consent for sexual intercourse to take place. Yet in 2000 there were more than 7,000 young people under sixteen, who had conceived, with over 54% ending in legal abortions. That is a lot of young people participating in an illegal sexual intercourse. Where have all the traditional family values gone? Traditionally people meet, fall in love, get married, have children and become a loving secure family unit. With the changing trends and loss of family values more than 90% of teenage births are outside of marriage. Thus changing family life has it was and creating a new trend towards single young mothers, children being brought up without permanent father figures, who are dependent upon the state to provide for them unless some changes can be made. The government states that it costs tax payers over i10 billion each year, the S. E. U reports say that this money could be better spent else where, and that unless we get this phenomena under control we can not support this rising tide of young teenage mothers. The government has been looking at the Netherlands and the United States for inspiration on how to deal with these issues. The Netherlands have one of the lowest teenage birthrate, they educate young people from a young age and take a more realistic approach to sex education. Compare this to the United States who do not provide support for teenage mothers and have used controversial measures such as forced sterilisation of certain ethnic groups and the family of these young people have to support them financially and emotionally in order for them to survive. Do young people see it as a problem? Is it an issue for young people? After looking at facts there seems to be no evidence that states it is a problem for the young people themselves, thus it is no big issue for them. Maybe it is just another way for the government to control the lives of young people? The government seems to be saying that teenage mothers are not equipped with the skills and knowledge to become competent parents, but who decides what makes a good parent, how can age be a deciding factor in good and bad parenting. So is it just an assumption that teenage pregnancy is a problem, functionalists would argue that it is just a process of socialisation and that if the young people aspirations could be raised then they would be able to break the cycle. Durkheim's anomie theory (1951: 273) seems to suggest ‘that a condition of normalness arises when a disruption of the social order occurs†¦ so that they are no longer controlled by the collective social order. ‘ Compare this to Merton's anomie (1938:53) ‘ the roots of which lie in a structural strain, generated by differential access to opportunity structures. Currently young girls who have little or no education and very few plans for the future are 30% more likely to get pregnant than those who aspire to gain qualifications and are well educated. Not being educated, in training or work are factors that are seen as being a negative influence on young girls and thus the risk of them becoming pregnant rises. Teenagers from socially deprived, poor families are less likely to have abortions compared to the young girls from more affluent families has they have higher aspirations in life and also have the funds to pay for private abortions. The lack of aspirations in the poorer young girls life, can lead them to believe that they can do nothing else and also if it was not a personal trouble for their mother then why should they expect anything else in life. Evidence seems to support the socialisation theory, with young girls often having no prospects due to lack of education, family support to break the cycle, believing that this is the way life is that this is all that life has to offer them and seeing that this is the way their life has been apped out for them. The lack of knowledge and confidence can also stop young girls from accessing services, which are available to them, and this just reinforces the negativity within their lives. As a result of finding themselves pregnant many young girls from poorer backgrounds, are less likely to continue with their education, compared to the young girls from more affluent homes who are expected to succeed in education and already have a prosperous career mapped out for them by their parents and peers. As a result of this young mothers from poor areas, start to become trapped in the cycle of poverty, with no way of supporting themselves and child they find themselves in the benefit trap. If they wait until the child is old enough to start school, returning to education is extremely hard and most training and apprenticeships are only open to school leavers. So with no experience, qualifications, expensive childcare and limited employment options due to most young mothers only being able to afford to work during the school time hours which are usually the lowest paid jobs the poverty trap begins a down ward spiral of debt and depravation. Therefore becoming a single teenage mother is a stigma and figures show them to be a burden on society hence a public issue. Are teenage mothers to blame for the creation of the emerging underclass in society? Teenage young mothers are often referred to as being a contributing factor in creating the underclass. The underclass theory (Murray 1980) describes this as ` people who are at the bottom of the social ladder, structurally separate and culturally distinguishable from the `decent` working class `. Murray (1980) discovered this new class of people in the 80's and he labelled them as the new underclass in Britain. He blames this emerging underclass on the over zealous welfare state system, which was set up to provide relief from poverty, not provide people with an alternative way of life. Where has Marx (1951) suggests that` we are born into a social class†¦ which are modified locally by region and neighbourhood`. Thus the teenage mothers cannot be to blame for the creation of the underclass, which adds viability to the theory put forward by Murray. The result of this theory is that there are now younger single parent families due to the ability to support themselves through the benefit system. Murray (1980) goes on to say that before the welfare system started to increase the level of provision there were few single parent families because they were not economically viable. He states `that the more generous benefits have made it possible for women to have children outside of marriage†¦ therefore the welfare state is to blame for this phenomenon. Thus he argues that the benefit system is to blame for single parents and they are a contributing factor of the underclass theory. Charles Murray (1980) goes on to say that we are creating a culture of dependency and if the benefits were taken away from single parents, it would discourage young people from becoming pregnant and is a possible solution to stop further development of the underclass. Many other people believe that young girls get pregnant on purpose in order to gain priority in the housing and benefits system. There are many flaws in Murray's (1980) theory the main one being that single teenage parents is seen in all class stratification and is not exclusive to the underclass element of society. Statistics show that young people do not start to enquire about benefits and housing prior to getting pregnant therefore these facts are not a forethought to getting pregnant. Research shows that most teenage pregnancies are not planned and young people seem to rarely plan for the future until after they are pregnant so they are very unlikely to have become pregnant in order to obtain benefits. Liberal thinking social theorists argues that the idea of an underclass diverts attention away from what the real issues are and the disadvantages experienced by certain groups of people in society especially young people from working class backgrounds. The conservatives denied poverty existed, so why is there a need for a welfare state and where is the emerging underclass. Labour said that it is just a lack of means to work that causes poverty, thus justifying the need for a welfare state and acknowledging the `underclass` exists. Other political groups outside these seem to blame poor education, bad housing unemployment, and family breakdown has main reasons why people become dependent on benefits and thus the underclass theory serves a purpose to hide the real causes of teenage pregnancy and social exclusion. Teenage pregnancy is a cause of and consequence of social exclusion, these young people share the values as everyone else unfortunately they have limited opportunities and are therefore restricted in plans for their future. These young people are deemed to be suffering from inequalities in life and are victims of an unjust society, which fails to ensure a fairer distribution of opportunities and resources. Poverty and social exclusion has a direct affect on the choices young women make about abortion and sex education, and if all young people had the same opportunities and options open to them when they find themselves pregnant or prior to having sex then maybe the rate of teenage pregnancies would fall. If young women have a clear vision about their future, their options in life explained clearly through education and training then they will have nothing to gain by choosing early parenthood. Whereas young people with no job prospects, poor education, who expects to be on benefits anyway might see that having a baby is going to provide them with a better future. The government are under pressure to cut the rate of teenage pregnancies as currently the UK has the highest rate in the western world. So what can the government do when the media seems to undermine all the initiatives that the labour government have come up with? All the media misrepresentation has altered the public's perception of teenage pregnancy and how the sex education program is delivered. The general consensus seems to be that Pregnancy advice is right, just the tactics used to deliver it are wrong. The media has highlighted this issue, alongside figures pointing out the amount of money currently being spent to deliver these services. It implies that all the time and money is being wasted has teenage pregnancy rates continue to ise. The media seems to be blaming the government for wasting money and accusing them of being dictators to young people The Daily Mail newspaper reports â€Å"60 million to tell girls that it is okay to be a virgin† how can this reduce the rate of teenage pregnancy, this nanny government is wasting money telling young people how to their lives. Whilst the girls are being advised to stay virgins they are not being told about sex and how it could affect them in their future and the message to boys is that sex is okay just wear a condom so the gap between the genders just keeps getting reinforced. The government have responded to this positively by bringing out new policies and are changing ways of delivering this service to youngpeople these include: Compulsory sex education: Sex education in schools is to become compulsory part of the national curriculum and will be taught alongside reading, writing, maths and science. The fact that it is compulsory seems to indicate that all children are being taught sex education but this is not so as parents can opt to remove their children if they so wish to. So were is the compulsory part? Should it be given to all children regardless to what a parent may feel? It is a civil right for every young person to be educated, so why is the choices to learn about sex being taken away from the young person, Why does a parent have the right to dictate to the young person what they need to learn to become a responsible adult later in life? Without sex education how can a child make the transition through adolescence from a child to a teenager who has a need to experiment sexually safely? To conclude, teenage pregnancy is a personal personal and a public issue. Many adoloscents I think fell trapped in a viscious circle. However I think that social exclusion and teenage pregnance are inextricably linked and these terms cannot be separated. The government have reccomended that young people should have better access to sex advice and other issues based around sex education. This is good practice but these clinics are not available countrywide, it is up to individual schools and parents to decide whether or not this service is should be available. On the other hand would these clinics encourage young people to have sex which would create an even bigger public issue?

Fair Value Accounting: Its Impacts on Financial Reporting and How It Can Be Enhanced to Provide More Clarity and Reliability of Information for Users of Financial Statements

International Journal of Business and Social Science Vol. 2 No. 20; November 2011 Fair Value Accounting: Its Impacts on Financial Reporting and How It Can Be Enhanced to Provide More Clarity and Reliability of Information for Users of Financial Statements Ashford C. Chea School of Business, Kentucky Wesleyan College 4721 Covert Avenue, Evansville IN 47714 USA Abstract The author begins the paper with a brief historical development of the Statement of Financial Accounting Standards (FAS 157) and its impact on fair value accounting.This is followed by the methodology employed in the research. Next, he reviews the literature on major issues in fair value accounting and financial reporting, and presents his findings from the study. The researcher ends the paper with recommendations to enhance the usefulness of fair value accounting and draws implications for financial reporting and users of financial statements.Keywords: Fair Value, Measurement, Financial Instruments, Market 1. INTRODUCT ION In December of 2001, accounting standard-setters around the world published a consultation paper (Financial instruments and similar items) that proposes fundamental changes to the way financial instruments are reported in the accounts of companies.In particular, the paper proposes, inter alia, that all financial instruments should be measured at fair value. The banking sector has long argued that such an approach is not appropriate for banks and that, to the extent that there are weaknesses in the way that banks currently account for their financial instruments, those ills are better addressed through incremental, than fundamental , change (Ebling, 2001).The Financial Instruments Joint Working Party of standard setters (JWP) main proposal are that: (a) all types of entity should measure all their financial instruments at fair value, and should recognize all changes in those fair values immediately in the profit and loss account; (b) the fair value of an instrument should be its estimated market exit price; (c) no exceptions should be made for financial instruments used in hedging arrangements (i. e. there should be no hedge accounting for financial instruments( Bies, 2005)).In other words, a financial asset for which an active market exists should be carried in the balance sheet at its market bid price and changes in that bid price should be recognized immediately in the profit and loss account. This would be the case regardless of the reason why the instrument is being held –for example, even if it is being held as a hedging instrument or being held until it matures—and regardless of the cause or nature of the market price change involved (Ebling, 2001). FAS 157 – Statement of Financial Accounting Standards No. 57, Fair Value Measurements—defines fair value and establishes a frame work for measuring fair value in generally accepted accounting principles (GAAP). While previous pronouncements involving valuation focused on what t o measure at fair value, FAS 157—issued by the Financial Accounting Standards Board (FASB) on September 15, 2006—focuses on how to measure fair value (Sinnett, 2007). What is fair value? FAS 157 are quite prescriptive, defining it as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between participants at the measurement dates (Chambers, 2008).FAS 157 put in place a framework for fair value measurement and disclosure. Perhaps the most important feature in FAS 157 is the requirement to set out financial statements in three levels that describe the reliability of the inputs used to establish fair value. Fitch describes it as the fair value hierarchy. So Level 1 is quite straightforward, as the price used are identical to the input and discovered in something like a public exchange. It gets quite complicated for Level 2 assets and liabilities, because the prices used might be inferred from an index or another secu rity with similar attributes to the one being measured.Fair value measurement in Level 3 assets are purely model-driven, consisting of unobservable inputs, and have understandably swollen as markets have grown increasingly illiquid and disorderly (Chambers, 2008). For many years, users of financial statements have sought relevant and timely information about financial instruments and off-balance sheet items and activities. It is believe that fair value measurements and recognition of these values in the financial statements, along with adequate disclosures, will provide necessary information to evaluate properly an enterprise’s exposures to financial risks, as well as rewards (Anonymous, 2002). 2  © Centre for Promoting Ideas, USA www. ijbssnet. com This is because fair value reporting reflects the economic reality by showing the volatility inherent in the values of financial instruments given changes in market conditions and operations of the enterprise. Historic cost-base d accounting smoothes these effects, thus, obscuring this volatility and masking the economic impact of various positions held in financial instruments (Anonymous, 2007). 2. METHODOLOGY This paper relies on the literature review of current relevant articles focusing on accounting for fair value.Except where a source was needed specifically for its perspective on broad issues relating to fair value accounting, the author screened by ? fair value accounting? and by numerous variants of keywords, focusing specifically on fair value accounting and financial reporting in firms. Source papers included refereed research studies, empirical reports, and articles from professional journals. Since the literature relating to fair value accounting is voluminous, the author used several decision rules in choosing articles.First, because the accounting profession is changing fast in today’s environment, especially for financial instruments, the author used mostly sources published 2002-2010 , except where papers were needed specifically for their historical perspectives. Second, given the author’s aim to provide a practical understanding of the main issues in fair value accounting, he included, in order of priority: refereed empirical research papers, reports, and other relevant literature on current firms’ fair value reporting practices.To get some perspective on the current state of fair value accounting, the author begins with a literature review of some of the most important issues relating to the concept. 3. LITERATURE REVIEW 3. 1. Statement of Financial Accounting Standards (FAS 157) FAS 157 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This definition abandons a longstanding practice of using the transaction price for an asset or liability as its initial fair value.In other words, fair value will no longer be base d on what you pay for something; it will now be based on what you can sell it for, also known as its ? exit price.? Just as important, this definition emphasizes that fair value is market based— requiring the consideration of what other market participants might pay for something—and is no longer entityspecific. Valuation will now be determined by a skeptical, rather than optimistic, buyer. In turn, the level of data available to measure fair value will determine how the valuation of an asset or liability is determined.Common valuation techniques identified by FAS 157 are the market approach, income approach and/or cost approach. These models require inputs that reflect assumptions that market participants would use for pricing an asset or liability. Observable inputs would be based on market data obtained from independent sources, such as stock exchange prices. Meanwhile, in the absence of an active market for an asset or liability, unobservable inputs reflect the rep orting entity’s own assumptions.The standard provides a fair value hierarchy that gives highest priority to quoted prices in active markets (defined as level 1) and lowest priority to unobservable inputs (level 3) (Sinnett, 2007). 3. 2. Mark to Market Mark-to-market accounting refers to the accounting standards of assigning a value to a position held in a financial instrument based on the current fair market price, rather than its original cost or book value, for the instrument or similar instruments. Fair value has been part of U. S. generally accepted accounting principles (GAAP) since the early 1990s.Investors demand the use of fair value when estimating the value of assets and liabilities. This has been influenced by investors’ desire for a more realistic appraisal of an institution’s or a company’s current financial position. Mark to market is a measure of the fair value of accounts that can change over time, such as assets and liabilities. For examp le, financial instruments traded on a futures exchange, such as commodity contracts, are marked to market on a daily basis at the market close (Metzger, 2010). When banks mark to market, they follow two steps.First, they estimate the net realizable value of their portfolio of asset-backed securities. This involves discounting the cash flows of these assets. Then under fair value accounting, they have to take a haircut on these values that takes into account the price at which they could sell the assets. When the market is not functioning, of course, this haircut is very large. This is important because it suggests that the huge decline in the value of bank assets is not due to a decline that has certainly occurred—but rather to the market’s judgment about the risk of resale by a purchaser.It is this risks that—when combined with fair value accounting—has forced the write-downs in bank assets (Wallison, 2009). 3. 3. Relevance 13 International Journal of Bu siness and Social Science Vol. 2 No. 20; November 2011 The debate of fair value accounting basically revolves around the issues of relevance and reliability. Before discussing the issues of relevance of fair value, the author looks briefly at how fair value and relevance are generally defined.Fair value is defined in the FASB’s Preliminary View documents as an estimate of the price an entity would realized if it has sold an asset or paid if it had been relieved of a liability on the reporting date in an arm’s –length exchange motivated by normal business consideration. Relevance is defined in the glossary of the FASB Statement of Financial Accounting Concepts No. 2 as the capacity of information to make a difference in a decision by helping users to form predictions about the outcomes of past, present, and future events or to confirm or correct expectation (Poon, 2004). 3. 4.Reliability and Measurements Reliability is defined in the glossary to the FASB Statemen t of Financial Accounting Concepts No. 2 as the quality of information that assures that information is reasonably free from error and bias and faithfully represented what it purports to represent. Fair value as an estimate of exit value under normal market condition is well defined and noncontroversial when there are well-established liquid markets. What if there is no liquid market? This is the situation in which an estimation of fair value will inevitably involve prediction of future cash flows and selection of appropriate discount rates.These estimates depend on management’s assumptions and measurement error. This has the potential to mask deliberate miscalculation and manipulation of the numbers. Both the FASB and the JWG acknowledge that some significant measurement issues must be resolved and they are working on developing more guidance regarding estimating fair value and establishing appropriate controls. However, it should be noted that the use of estimate is an esse ntial part of preparation of financial statements, e. g. the ubiquitous use of estimates in pension accounting (Poon, 2004).If markets were liquid and transparent for all assets and liabilities, fair value accounting clearly would be reliable information useful in the decision-making process. However, because many assets and liabilities do not have an active market, the inputs and methods for estimating their fair value are more subjective and, therefore, the valuations less reliable (Bies, 2005). 3. 5. Verification As the variety and complexity of financial instruments increases, so does the need for independent verification of fair value estimates.However, verification of valuations that are not based on observable market prices is very challenging. Many of the values will be on inputs and methods selected by management. Estimates based on these judgments will likely be difficult to verify. Both auditors and users of financial statements, including credit portfolio managers, will need to place greater emphasis on understanding how assets and liabilities are measured and how reliable these valuations are when making decision based on them (Bies, 2005). 3. 6.Disclosure The FASB states that the proposed update would change the wording used to describe the principles and requirements in U. S. GAAP for measuring fair value and for disclosing information about fair value measurements. Specifically, the proposed update would include amendments to (a) clarify FASB intent about fair value application of existing fair value measurement and disclosure requirements, and (b) change a particular principle or requirement for measuring fair value or disclosing information about fair value measurements (Elifoglu et al. 2010). 3. 7.Financial Instruments Financial instruments versus nonfinancial instruments—many see fundamental inconsistency between measuring financial instruments at fair value and nonfinancial items largely on historic cost basis. Standard-setters reco gnize that whenever a boundary is drawn between financial statement items with different measurement attributes some inconsistencies and complexities often results. It is argued that there is economic logic in drawing a line between financial instruments and nonfinancial items, and more so than drawing a line including some inancial instruments but not others (Hague, 2002). Conceptually, the periodic returns on financial instruments can be separated into three components with distinct sustainability or certainty. The first two components—amortized cost interest and the difference between fair value interest and amortized cost interest-sum to fair value interest. It is useful to distinguish these two components of fair value interest because amortized cost interest is both sustainable and certain, whereas the difference between fair value interest and amortized cost interest is sustainable but uncertain.The difference between fair value interest and amortized cost interest is sustainable because unexpected changes in interest rates and the resulting unexpected changes in fair values affect fair value interest calculations throughout the remaining lives of financial instruments. 14  © Centre for Promoting Ideas, USA www. ijbssnet. com For example, an unexpected gain on a financial asset due to a decrease in interest rates in the current period reduces expected fair value interest revenue on the asset throughout its remaining life.This third component of the periodic returns to financial instruments is the unexpected change in their fair values during the period. Unexpected changes in the fair values of financial instruments are both unsustainable and uncertain (Ryan & et, al. , 2002). 3. 8. Financial Reporting The reporting of financial assets and liabilities is an election on a contract-by-contract basis and not mandatory. Therefore, not all instruments will necessarily be reported at fair value.In order to distinguish instruments that are reported at fair value from those that employ some other measurement, firms will have one of two reporting options on the statement of financial position. A firm may display the two classifications, fair-value and non-fairvalue carrying amounts, as separate line items on the statement of financial position. The second option for reporting is parenthical disclosure where the firm presents the aggregate of the two classifications and discloses the amount of the fair value parenthically (Schneider & McCarthy, 2007). . 9. Critics of Fair Value Critics argue that fair value accounting has created a false short-term visibility in the case of pension funding and hastened the demise of defined benefit schemes. More generally, critics argue that the financial crisis demonstrates the pro-cyclicality of fair values when accounting is tightly coupled to prudential regulatory systems, and the unreliability of marking to model in less than liquid asset markets, especially for assets which are being held for the long term (Power, 2010).They also add that the impact of fair value accounting (FVA) is likely to be more restrictive lending policies, and more demanding loan covenants, than are necessary for sound risk management, together with pricing which will be higher than is economically necessary (Allatt, 2001). Moreover, several commentators remarked on the fictional and imaginary nature of fair value and bemoaned their subjectivity and potential for manipulation and bias.Regardless of whether these criticisms have substance, it is also the case that if enough people believe in fictions, then they can play a role in constituting markets (Power, 2010). Many are comfortable with historic cost/realization accounting on the grounds that it is familiar and provide a more stable basis for prediction of future accounting than fair values. They argue that fair value based earnings cannot be predicted in the same way because of the effects of uncertain future events and see this as a significa nt drawback in being able to prepare budgets, forecasts, etc. nd to manage analysts’ expectations (Hague, 2002). Nevertheless, many critics of the subjectivity of fair value miss the real point. The very idea of reliability is being reconstructed in front of their eyes by shifting the focus from transactions to economic valuation methods, and by giving these methods a firmer institutional footing. Deep down the fair value debate seems to hinge on fundamentally different conceptions of the basis for reliability in accounting, making it less of a technical dispute and more of the politics of acceptability (Power, 2010). . 10. Proponents of Fair Value Few will question the relevance of information based on market prices as historical cost information is based on market prices at which assets were initially acquired and liabilities were initially incurred whereas fair value are based on current market prices. Fair value reflects the effects of changes in market conditions and cha nges in fair value reflect the effect of changes in market conditions when they take place. In contrast, historical ost information reflects only the effects of conditions that existed when the transaction took place, and the effects of price changes are reflected only when they are realized. As fair value incorporate current information about current market conditions and expectations, they are expected to provide a superior basis for prediction than outdated cost figures can since these outdated cost figures reflect an outdated market conditions and expectations (Poon, 2004).Proponents of fair value in accounting often appeal to notions of telling things as they are and of improving transparency. They point to areas such as pension accounting or the savings and loans industry in North America where fair values would have made problems (deficits, poor performing loans) visible much earlier, thereby enabling corrective action. An often heard trope is that one should not shoot the me ssenger of poor asset quality (Ebling, 2001). 4. FINDINGSWhile there is a large number of assets and liabilities reported or disclosed in financial statements, the percentage of these items and the dollar impact on earnings may not have been exorbitant for most companies, except for financial institutions. 15 International Journal of Business and Social Science Vol. 2 No. 20; November 2011 In 2008, only 27% of the total assets of the S&P 500 companies that had adopted FAS 157 were actually reported at fair value (Zion et al. , 2009). While this represents about $6. 6 trillion in assets, it is still a relatively small percentage of the assets.Because of the mixed attribute model used in U. S. Generally Accepted Accounting Principles (GAAP), some assets are measured using fair value while others—even very similar assets are measured at cost, or amortized cost, or by some other measure. The nature of the assets held by these companies determined, to a large extent, their exposur e to risk in the credit crisis. Companies in the financial sector had a much larger number of fair valued assets (39%) then did, for instance, companies in consumer staples (2%).Even within the financial sector, investment banks and insurance companies, most of whose assets are reported at fair value, were impacted more than commercial banks, whose largest assets is generally loans, which are not reported at fair value (Casabona & Shoaf, 2010). In addition, there is ample empirical evidence to support the relevance of fair value information of financial instruments. For example, Barth (2006) finds that fair valuation of investment securities influences the share price indicating that it provides extra information to investors.Additional discussion of findings of research on accounting for fair value of financial instruments can be found in FASC 1998 study (Poon, 2004). 5. ANALYSIS AND DISCUSSION While most people agree that fair values are the most relevant measure for financial ass ets and liabilities that an entity actively trades, some (most notably, those in the banking industry) argue that historical cost is the more appropriate measure if management intends to hold an asset or to owe a liability until maturity.The rationale for accounting on a historical cost basis is that it better reflects the economic substance of the transactions and the actual cash flow over time. They argue that fair value information, on the other hand, would reflect the effects of transactions and events in which the entity would not participate and thus is often irrelevant. The question here is whether management’s decision to hold assets or to continue to owe liabilities in light of changed market condition is relevant in evaluating the entity’s financial position and performance (Poon, 2004).Some also argue that the outcome of fair value accounting on entity’s financial liabilities is counterintuitive if its credit risks changes. The fair value of a financi al liability will decrease when the issuing entity’s credit risk deteriorates because the interest rate on the initial issue date would now be lower than what it would be if the liability was issued today. Conversely, if an entity’s credit rating improves, an increase in the fair value of its financial liability will result.However, as explained in Barth and Landsman (1995), changes in the credit rating represent wealth transfers between creditors and stockholders. It is not counterintuitive to see a decrease (an increase) in the value of a financial liability when there is a wealth transfer from creditor (stockholders) to stockholders (creditors) corresponding to the deterioration (improvement) of the credit rating of the issuing entity. Therefore, the outcome of fair value accounting is not readily counterintuitive.But as illustrated in Lipe (2002), financial statement users must be better educated about the impact of fair value accounting on financial liabilities. I n particular, a decrease (an increase) in the fair value of financial liabilities should not be interpreted as positive (negative) if it is due to deteriorating (improving) credit quality. In addition, loan covenants have to be revised and financial ratios involving financial liabilities have to be analyzed accordingly (Lipe, 2002).Still another argument against fair value accounting is the induced volatility of earnings if changes in fair values are reported in earnings. Some believe that this volatility of earnings may not correlate to management’s performance and that this would make it more difficult for users to predict future performance. First, this is not a reliability issue since fair values can be reliably measured but still vary a great deal from one period to another.Second, the requirement of fair value reporting does not have to go hand in hand with the requirement of recognizing changes in fair values in reporting earnings (Poon, 2004). For this reason changes in fair value should be separately reported based on causes such as the passage of time, changes in market conditions, changes in the entity’s financial health, changes in estimate, and changes in valuation techniques.Requiring fair value information as supplemental disclosures instead of financial statement recognition also addresses some of the concerns (e. g. , volatility of reported assets, liabilities, and earnings) of the opponents of fair value accounting. In addition, this will allow financial statement users to decide on their own how much reliance they will put on and how to use fair value information (Poon, 2004).FSP FAS 175-4 provides application guidance to assess whether the volume and level of activity for asset or liability have significantly decreased when compared with normal market conditions. However, this assessment should consider whether there are factors present that indicate that the market for the asset is not active at the measurement date, such as : (a) there are few recent transactions based on volume and level of activity in the market, (b) price quotations are not based on current information , 16  © Centre for Promoting Ideas, USA www. ijbssnet. com c) price quotations vary significantly either over time or among market makers , (d) there is a significant increase in implied liquidity risk premiums, yields, or performance indicators (such as delinquency rates or loss severities) (e) There is a significant decline or absence of a market for new issuances (Casabona & Shoaf, 2010). Research by Federal Reserve staff shows that fair value estimates for bank loan can vary greatly, depending on the valuation inputs and methodology used. For example, observed market rates for corporate bonds and syndicated loans with lower-rated categories have varied by much as 200 to 500 basis points.Such wide ranges occur even in the case of senior bonds and loans when obligors are matched. Moreover, the FASB statement on the proposed fair v alue standards that reliability can be significantly enhanced if market inputs are used in valuation. However, because management uses significant judgment in selecting market inputs when market prices are not available, reliability will continue to be an issue (Bies, 2005) 6. RECOMMENDATIONS In order to provide more relevant information to financial statement users, fair value information should be reported for all financial assets and liabilities.Given that there are still some important conceptual and practical issues relating to the reliable determination of fair value, it is better to first require full fair value disclosures before contemplating a shift to full fair value recognition in financial statements. That would enable investors, creditor, preparer, auditors, and regulators to learn from experience. When the issues relating to the reliable determination of fair values are resolved, they will be ready for full fair value recognition in financial statements (Poon, 2004).T he author concords with the SEC recommendations, which are expected to impact the FASB’s future activities, including (a) improve fair value accounting standards (b) improve the application of existing fair value requirements (c) readdress the accounting for financial asset impairment s (d) establish formal measures to address the operation of existing accounting standards in practice (e) implement further guidance to foster the use of sound judgment of practitioners (f) address the need to simplify the accounting for investments in financial asset (Casabona & Shoaf, 2010).The first priority seems to be to work in close co-operation with users and preparers of financial statements to further consider the practicality of the proposals and to demonstrate or refute the relative merits of fair value and historic cost based reporting of financial statements for users’ analysis purposes. Such work should involve rigorous testing to consider how fair value information would b e used in decision models, as well as to stimulate the preparation of fair value information to understand better the extent of many of the practical concerns (Hague, 2002).Second, implementation of the proposals would provide more useful, relevant and transparent information about an enterprise’s use of financial instruments than is available today. The full benefits, however, will only be understood with careful study and education about how to use the new information. A somewhat different mindset and base of expertise (from that appropriate to traditional recognition and historical cost-based accounting for financial instruments) is also necessary. This includes integrating knowledge of certain finance and capital-markets concepts and practices with financial accounting objectives and concepts (Hague, 2001).Third, financial instruments should be grouped and displayed on the balance sheet based on the underlying characteristics of the instruments, such as unconditional righ ts to receive or obligations to deliver, and by major classes within these groups. Detailed, descriptive information about the nature and terms of these financial instruments, as well as management’s policies pertaining to them, should be disclosed in the notes to the financial statements in a manner consistent with the balance sheet (Anonymous, 2002). Fourth, fair values reflect point estimates and by themselves do not result in transparent financial statements.Hence, additional disclosures are necessary to bring meaning to these fair value estimates. FASB’s proposal take a first step toward enhancing fair value disclosures related to the reliability of fair value estimates. Additional types of disclosures should be considered to give users of financial statements a better understanding of the relative reliability of fair value estimates. These disclosures might include key drivers affecting valuations, fairvalue-range estimates, and confidence level (Yonetani & Katsu o, 1998). Finally, another important disclosure consideration relates to changes in fair value amounts.For example, changes in fair value of securities portfolio can arise from movements in interest rates, foreign-currency rates, and credit quality, as well as purchases and sales from the portfolio. For users to understand fair value estimates, they must be given adequate disclosures about what factors caused the changes in fair value (Bies, 2005). 7. IMPLICATIONS FOR FINANCIAL REPORTING AND MANAGERIAL DECISION-MAKING Several implications are drawn from this paper. 17 International Journal of Business and Social Science Vol. 2 No. 20; November 2011First, standard-setters and regulators would be required to provide more specific guidance on how to determine fair value for financial statements. Perhaps, they can list some common valuation techniques and indicate their appropriateness in various circumstances. Disclosure requirements would include disclosure of fair value of all financ ial instruments along with method adopted to determine fair values, any significant assumptions used in their estimation, some indications of the sensitivity of the estimated fair value to these assumptions, and discussion of risk exposure and issues associated with the estimation of fair value (Poon, 2004).Second, the role of external financial reporting is to portray an enterprise as if seen through the eyes of management—that is, that financial reporting should be consistent with internal management practices. It is, obviously, desirable that there be as much compatibility between the two as possible. However, it is difficult to see how accounting that is driven by the manner in which an enterprise chooses to manage its financial instruments and risks can provide information to financial statement users that are consistent and comparable between enterprises (Hague, 2002).Third, the objectives of financial analysis are to discern and assess the effects to an enterprise†™s performance and financial condition, including those that result from its risk management policies and decisions that involve financial instruments. In addition, financial statement users want to assess how well an enterprise effectively applies these policies in managing the risks of the enterprise. Therefore accounting and disclosure requirements related to financial instruments must be designed to explain (a) risks inherent in a given business (b) hedging strategies employed and (c) outcome(s) of such hedging activities.In other words, financial and nonfinancial disclosures should provide sufficient information for users of this information to discern and answer question, such as these: (a) what are management’s policies and procedures for using certain financial instruments? (b) How extensively does the enterprise use these financial instruments as part of its risk management? (c) What are the timing and the magnitude of the effects of the instruments on fair values in the balance sheet and changes in these values reflected in the income statement? d) How effective, or ineffective, are the position in these financial instruments as hedges in managing the risk exposure of the enterprise? And (e) what portion of the gains and losses reported in the balance sheet and income statement is realized and unrealized? (Anonymous, 2002). Fourth, the fact that management use significant judgment in the valuation process, particularly for level 3 estimates, add to the concern about reliability. Management bias, whether intentional or unintentional, may result in inappropriate fair value measurements and misstatements of earnings and equity capital.This was the case in the overvaluation of certain residual trenches in securitizations in recent years, when there was no active market for these assets. Significant write-downs of overstated asset valuations have resulted in the failure of a number of finance companies and depository institutions. Similar problem s have occurred due to overvaluations in nonbank trading portfolios that resulted in overstatements of income and equity. The possibility of management bias exists today. There continue to be new stories about charges of earnings manipulation, even under the historical cost accounting framework.It is believe that, without reliable fair value estimates, the potential for misstatements in financial statements prepared using fair value measurements will be even greater (Bies, 2005). Fifth, three fundamental goals of accounting that are likely to have influenced the choice of fair value accounting for all financial firms. One of these objectives is to minimize what is called management bias. Management has an obvious incentive to inflate the value of a company’s assets, and many ways to do it. Marking a company’s assets to market is an effective way of taking his element of financial statement manipulation out of management’s hands (Wallison, 2009). Finally, the opt ion to use fair value for certain assets and liabilities will provide more relevant information to the users of financial statements. However, since the fair value usage can be elected for some financial assets and financial liabilities and avoided for others, there is a loss of consistency in the financial statements between entities and even within a single entity. Also the new standard imposes additional disclosure requirements (Schneider & McCarthy, 2007). 8. CONCLUDING REMARKSCurrent methods of accounting for financial instruments have been of concern to accounting standard-setters around the world for some time now. These concerns about financial instruments start from the observation that markets now exists for either the instruments themselves or the various financial risks that arise from the instruments, and the availability of those markets enables entities to actively manage the financial risks and, thereby, to realize some or all of the market value of their financial i nstruments with ease. (Ebling, 2001). 18  © Centre for Promoting Ideas, USA www. ijbssnet. comIt has been argued that different conceptions of what is for an accounting estimate to be reliable underlie the fair value debate as it has taken shape in the last decade. The language of subjectivity and objectivity is unhelpful in characterizing what is at stake; it is more useful to focus on the question of how certain valuation technologies do or don’t become institutionally accepted as producing facts (Power, 2010). However, the shift in accounting principles will not come without some additional effort by all capital market participants, including preparers, auditors, regulators, and users of this information.It is realized that accounting and reporting based on fair value principles, in comparison with historical cost-based principles, require more extensive and detailed analysis of the methods and assumptions used to determine values recognized in the financial statements. This in turn, will require market participants to redesign the current financial reporting model and to educate themselves in the application of these new principles. Nonetheless, transparency of the true economic consequences, i. e. isks and rewards, resulting from the use of financial instruments justifies the movement to a fair value based model for financial reporting (Anonymous, 2002). Certainly, mark-to-market reporting has its drawbacks, especially for derivatives. First, fair value based on market prices can be difficult to determine for complex and lightly traded instruments. These types of derivatives are the level 3 type mentioned above. These derivatives are usually measured using a mark-to-model process, which can be arbitrary at best and fraudulent at worst.Next, there is the theoretical issue, as banks successfully argued, as to whether market price does indeed represent fair value. Also, the relevance of market prices can be challenged with respect to intent. Some ob servers challenge the relevance of market prices because they believe that, if government officials do not intend to trade derivatives but rather hold them to maturity, as is usually the case with derivatives used for hedging, then the time and expense of determining fair value may not be worthwhile.Still, using fair value accounting is proper for derivative reporting because it enhances the following qualities or objectives of financial measurement and reporting: accountability, transparency, consistency, inter-period equity, and risk management (Metzger, 2010). REFERENCES Allatt, G. (2001). Fair value accounting: Examining the consequences. Balance Sheet, 9, 22-26. Anonymous (2007). Statement of financial accounting standards No. 159: The fair value option for financial assets and financial liabilities. Journal of Accountancy, 203, 96-101. Anonymous (2002). Financial instruments: Fair values and disclosure.Balance Sheet, 10, 12-20. Bath, M. (2006). Including estimates of the futur e in today’s financial statements. Accounting Horizon, 20, 271-286. Barth, M. & Landsman, W. ( December, 1995). Fundamental issues related to using fair value accounting for financial reporting. Accounting Horizons, 97-107. Bies, S. S. (2005). Fair value accounting. Federal Reserve Bulletin, 91, 26-30. Casabona, P. & Shoaf, V. (2010). Fair value accounting and the credit crisis. Review of Business, 30, 19-31. Chambers, A. ( March, 2008). How do you mark to market? Euromoney, 1-3 Ebling, P. (2001). Fair value accounting: Breaking a butterfly upon a wheel?Balance Sheet, 9, 22-27. Elifoglu, I. H. , Fitzsimons, A. P. , & Lange, G. A. (2010). FASB proposal clarifies fair value measurement and disclosure. Commercial Lending Review, 75, 42-48. Hague, I. (2001). Fair debate for fair value. CA Magazine, 134, 47-49. Hague, I. (2002). Fair value for financial instruments: Where to next? Balance Sheet, 10, 8-12. Lipe, R. (2002). Fair value debt turns deteriorating credit quality into pos itive signals for Boston Chicken. Accounting Horizons, 17, 169-181. Metzger, L. (2010). Mark to market governments. The Journal of Government Financial Management, 59, 16-20. Poon, W. W. (2004).Using fair value accounting for financial instruments. American Business Review, 22, 39-44. Power, M. (2010). Fair value accounting, financial economics and the transformation of reliability. Accounting and Business Research, 40, 197-211. Ryan et al. (2002). Reporting fair value interest and value changes on financial instruments. Accounting Horizons, 16, 259-268. Schneider, D. K. & McCarthy, M. G. (2007). Fair value accounting broadened with FAS-159. Commercial Lending Review, 45, 28-36. Sinnett, W. M. (2007). New fair value standards stress HOW not just WHAT. Financial Executive, 23, 33-36. Wallison, P. J. (2009).Fixing fair value accounting. OECD Journal on Budgeting, 9, 99-105. Yonetani, T. & Katsuo, Y. (1998). Fair value accounting and regulatory capital requirements. Economic Policy Rev iew, 4, 33-44. Zion, D. , Varshney, A. & Cornett, C. ( June, 2009). Focusing on fair value. Credit Suisse Equity Research, 4, 18-20. 19 Copyright of International Journal of Business & Social Science is the property of Centre for Promoting Ideas and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use.

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A Joint Venture Company. What Is The Difference Between This Type Of Companies And Joint Stock Companies - Essay Example Since a joint venture partnership company is only formed for the short term, it terminates when the purpose of the joint venture partnership company is fulfilled. Similarly, each party also contributes in the assets to start up this joint venture. Most often, companies use joint ventures as a means of infiltrating foreign markets where they see potential and seek to do business in. for instance, if a foreign company is interested in doing business in China, they will form a joint venture company with a domestic Chinese firm which will help them gain access to the Chinese market due to the experience of the domestic company which already knew the ropes of how to function in the local Chinese market. Furthermore, when foreign companies enter into joint venture partnership companies with domestic firms of the market that they want to enter and operate in, they are not the only ones who benefit from the arrangement. Domestic firms are at an advantage in this arrangement too, they benefit from the new technological and business practices that the foreign firms bring to their market which serve as a learning experience for the domestic firms, consequently expanding their horizons. The foreign companies benefit from the value provided to them by the domestic company’s pre-existing relationship with the key players in the domestic government and industry. In more technical terms, a joint venture is treated like a regular partnership business for taxation purposes. However, joint ventures that transcend the boundaries of one country and go global are subject to international trade laws as well as the internal laws of the government of the economy they plan to penetrate. (Joint Venture, 2010). According to Folta (2012), who writes about foreign joint ventures in China, talks about how joint ventures a way for foreign firms to get past the barriers of the local Chinese market and reap the benefits of business operations in the local market. While talking about the advantages of joint venture partnership companies, the author mentions several factors that come into play. Other advantages of joint venture partnership companies include the fact thet they alleviate rich, grant access to domestic markets, are easier to manage and offer benefits in terms of tax advantages. â€Å"Partnerships, Joint Ventures and Strategic Alliances† talks about the effective connection among the three entities in business. As the authors point out, joint ventures have one of the highest crash rates in the world. (Glover and Wasserman, 2003). Yet, still joint ventures are becoming a growing trend in the modern globalized world. (Gutterman, 1997). As can be deduced, this paradigm shift has been due to the vast avenue of opportunities that globalization has opened up for businesses all over the world. They have now become interested in foreign economies as lucrative sources of investment and income for their business operations and joint venture companies provid e them an ideal platform to increase their reach into the market of a foreign economy they are interested in. Visconti (2003) in his book â€Å"Joint Venture† also talks about the topic along similar lines. Joint stock companies on the other hand are companies set up for business activity with the profit motive with profit divided among the owners who are the share holders in proportion to the amount of stock they own in the company. When owners invest in a joint stock company they receive shares in return for that investment. The business operatio

Police & Society Ch 11 & 12 Essay Example | Topics and Well Written Essays - 500 words

Police & Society Ch 11 & 12 - Essay Example Those followed up evidences which pertain to the illegal evidence are also rejected. In some special cases, there are some exceptions where a police can arrest a person or search a place without any warrant. In such cases, those convicted and the evidences obtained also come under the law. Police have permission to search and seize evidences if it is in a plain view. But the real problem happens in the case of vehicle theft. Searching a vehicle without a warrant is lawful because of the mobility. Fifth Amendment specifies that when a person is arrested, he or she must be given advice of his or her Miranda rights. It is a must because every accused person has the right against self-incrimination. Still, there are exceptions in these cases too. The police can be held if they commit a wrong or misuse the law. In case of federal violations, the police may be able to defend himself. Civil liability leads to disastrous effect known as de-policing. This occurs when police fail to interact with citizens due to the fear of liability lawsuit. American society has become rapidly diverse that diversity in policing fails to follow the same pace. Policing still remains to be a male dominant profession. Minorities are still finding tough to join the police force. Even if they join, they have to face with unequal treatment. Promotions, other compensations are usually restricted to these minorities. Black officers are still prevented from arresting a white accused. As a result, when the black officers were evaluated, it was found out that a black officer does act harder on black people. This is to indicate that they were not biased. This ‘double marginality’ as it is called is of less threat nowadays. Women in policing are also of no exception. The activity of a female in policing was restricted to certain minimum. They did not go for a patrol till 1968. Later, studies illustrated that a female officer is capable of doing work in

Childhood Obesity and its Risks Research Paper Example | Topics and Well Written Essays - 750 words

Childhood Obesity and its Risks - Research Paper Example The introduction of the article gave a brief description of body mass index ( BMI) as a measure of obesity. The historical background of the research is focused on the increased cardiovascular risk for obese children. The importance of measuring BMI and its validity in establishing obesity was a good platform for establishing a good hypothesis. The study was conducted no less than one of the authors with another group of researchers. Studies citing complications that arose from obese children in a 40 yr follow-up study by Jacques et al it was presented. Accordingly, the study by Jacques revealed that childhood obesity did not only result in diabetes but led to increased mortality due to coronary artery disease as well. The present study hypothesized that early childhood obesity along with a sedentary lifestyle increases the risk of diseases such as type 2 diabetes and cardiovascular diseases. This translates to the higher incidence of mortality when these children become adults. For the methods section, a comparative survey that compares the BMI across teens in the US was used. The cited study was done by Lissau et al published in 2003. The method engaged was a cross-comparison of incidence of obesity in teens in the US against teens in Europe. The comparison resulted in the conclusion that the occurrence of obesity in US teens is three times higher than European counterparts. Unfortunately, much cannot be said about statistical data since the study was just referenced in the journal. In addition, the lot of the given conclusions were summaries of compiled studies. In fact, the journal is more like of an informative and persuasive article that warns the public of the dangers of childhood obesity.

Risk Management and Policy Decision-Making Essay - 1

Risk Management and Policy Decision-Making - Essay Example the fear of the resiliency of the breaks in the weather condition and even the managers of the manufacturers of the machine, Ferrari, refused but the persuasion by the officials ensured that the cars were launched according to the plans and previous schedules of launching. The decision to launch the first Ferrari was arrived at after numerous hours of debating which involved both the management of the rallying event, the makers and all the external political forces. All this were influenced by numerous bureaucracies in the handling of the actual decision of whether to proceed with the launch or not to proceed. Since the decisions were being made from a multifaceted approach, the heroic engineers tried to avoid the accident by cancelling the launch but the administrators due to their lack of the actual knowledge and evidence that could lead to disastrous outcome of the launch; they went ahead and initiated it. However there is the actual lack of evidence that portrays previous accidents correlating the slippery road surface and the rainy weather as having disastrous effects on the brakes of the super road machines. There is clearly a missing evidence of previous accidents in relation to the brakes resiliency due to variation in the rain drizzles. However the indication of the failure of the car breaks is explained as indicated by the Ferraris explanation using their chats does not show the evidence of similar accidents or disasters with a cause that is due to the correlation with drizzles variability and the physical conditions of the roads post the rainy event. Even though some of the previous launches under similar conditions indicated the possibility of the failure of breaks , but there was no evidence of cause in relation to the crushing of Ferrari one. This accident had an impact in the future management of the high speed rally cars launches in relation to the weather of the day. In relation to the management approaches and the ideologies of the engineers,

Eleanor Roosevelt Essay Example for Free

Eleanor Roosevelt Essay And strength, courage and confidence she possessed. Forty-six years after Eleanor Roosevelt’s death yet she the former First Lady still remains an influential women in the world. She supported her husband’s political career. In fact, President Franklin Roosevelt often called his wife his â€Å"eyes and ears† (Bradgon, McCutchen, and Ritchie 776). Eleanor Roosevelt played a pivotal role in the Roosevelt administration especially when paralysis hit the president (776). She used this power to advocate for civil rights, especially for the women (Goodwin 1998). The was the first woman to become the voice of the ordinary people, she spoke in national conventions, held press conferences, lectured, and wrote a syndicated column (1998). She fought for the plight of the poor, the women, and the African Americans (777). She was a super woman, so to speak. Her fight for social justice was perhaps what Roosevelt is famed and revered for. She helped laid the cornerstone of the civil rights and women’s movement. It was her greatest achievement, one that the world will forever be grateful for. Eleanor Roosevelt was born October 11, 1884 to Elliott Roosevelt and Anna Hall (Caroli 2008). Although she came from an influential family (her uncle was Theodore Roosevelt), her life story did not start out smoothly (2008). Hers was what people would call a â€Å"dysfunctional family† (Tindall and Shi 1266). Her father was described was an alcoholic who got servant girl pregnant while her mother was said to be a â€Å"cold, self-absorbed socialite† (Tindall and Shi 1266). Despite this, Eleanor loved her parents deeply. However, tragedy struck the family. By age ten, both her parents died and Eleanor, together with her brother, was brought to be raised by relatives (Caroli 2008). Eleanor’s other brother had died a year before (2008). Eleanor was extremely close to her father and his death deeply affected the young girl (2008). The siblings were brought to their grandmother Mary Hall to become their guardian (Black 2008). An introvert, Eleanor was sent to Allenswood, a girls’ boarding school by age 15 (Caroli 2008). Under the wing of Mademoiselle Marie Souvestre, Eleanor’s intellectual curiosity was awakened. Souvestre was a confident woman who was a staunch believer in the liberal causes (Black 2008). In Eleanor’s three years at Allenswood, she forged friendship not just with Souvestre but with young girls her age; she learned language, literature and history; expressed her opinions on political events; and discovered Europe in summers (2008). She was, to say the least, transformed into a â€Å"tall, willowy, outgoing woman† (Tindall and Shi 1266). In 1902, Eleanor went back to New York for her â€Å"coming out† into society (Caroli 2008). Following her family’s tradition, she immersed herself into social responsibilities, enlisting with the National Consumers League and the Junior League for the Promotion of Settlement Movements (Black 2008). She also volunteered to teach at the College Settlement on Rivington Street (2008). Her endeavors soon reached the attention of the New York reform group (2008). One summer, on a train ride to Tivoli, she bumped into her fifth cousin Franklin Delano Roosevelt (Black 2008). A secret courtship began and on November 22, 1903, the two became engaged (2008). The two were different. Eleanor was often described as a serious person, someone of â€Å"high ideals and principles† while Franklin was a confident man, who grew with love and affection from his family (Tindall and Shi 1267). Franklin’s mother, Sara was against the relationship and tried in vain to separate the two. On March 17, 1905, Eleanor and Franklin were married in New York (2008). The wedding, wherein President Theodore Roosevelt gave the bride away, was on the front page of the New York Times (2008). In a span of 10 years, Eleanor gave birth to six children, one of whom died after birth (Caroli 2008). In 1911, Franklin won a seat in the New York senate and the family relocated to Albany (Black 2008). Eleanor looked forward to moving out, especially since in their old home, her mother-in-law was constantly breathing down her neck. She was said to comment that the move ignited her desire to become independent and be an individual (2008). As Franklin started to carve his political career, Eleanor took on the role of a political wife- gracing formal parties and â€Å"making social calls† (2008). When World War I broke in 1917, Eleanor found herself returning to volunteer work. She spent her free time helping the Navy- Marine Corps Relief Society and the Red Cross (Caroli 2008). Her unwavering commitment opened another door in her life- that of being able to be of service to others. For some time, she was in the shadow of her political husband. The War ignited her desire to pursue other plans outside her husband. It helped boost her confidence. Ruby Black, Eleanor’s friend, once commented that the war became her first work â€Å"outside her family† (Black 2008). But this awakening of sorts was dampened when Eleanor found that her husband was involved romantically with another woman, Lucy Mercer. Mercer was Eleanor’s social secretary (Caroli 2008). This caused a dent in the couple’s relationship and Eleanor suggested to have a divorce, which Franklin refused (2008). Franklin ended the relationship with Mercer and tried to patch things with Eleanor. Though they continued on with the marriage, it was said that they remained affectionate but no longer intimate (2008). In 1921, Franklin fell ill with polio and was paralyzed (Tindall and Shi 1267). Despite what had happened in their relationship, Eleanor did not leave her husband. She helped him in his career, attending political gatherings and speaking on his behalf (1267). According to their daughter Anna, polio was instrumental in bringing their parents together (1267). While Eleanor supported her husband, she started to carve her own name. She became active with the Women’s Trade Union League and the Democratic Party of the New York state (Caroli 2008). As Chair of the League of Women Voters Legislative Affairs Committee, Eleanor read the Congressional Record, talked with members of Congress and the State Assembly and presented a report on a monthly basis (Black 2008). She was especially interested in non-legislative issues like primary reform, voter registration and party identification (2008). Eleanor also wrote for the Women’s Democratic News (2008). Three years after, Eleanor was part of a group whose purpose was to inform women on participating in political and social issues. As board member of the bi-partisan Women’s City Club, Eleanor led the City Planning Department, tackling issues such as housing and transportation, child labor, and the distribution of birth control information on married people (Black 2008). She also taught at a school (2008). When Franklin was elected governor, Eleanor divided her time equally, ensuring that she pursued her personal interest and that of being a governor’s wife. When the Governor’s inner circle had disagreements with Eleanor’s League of Women Voters, Eleanor acted as arbitrator (Black 2008). Her political grace, no doubt, was shaping up. Following Franklin’s successful crack at the presidential election, the now First Lady continued with her passion. With her own staff, Eleanor carried on with her causes. She had press conferences with women correspondents, something she was keen on. She also talked to her husband about employing women in his cabinet (Tindall and Shi 1268). In fact, she backed the successful appointment of France Perkins as Secretary of Labor (Caroli 2008). Like the First Lady, Perkins was an advocate of minimum wage and maximum hour laws, child-labor restrictions and other reforms (Bradgon, McCutchen, and Ritchie 776). Eleanor was not afraid to speak her mind, even if it meant carping on her husband’s plan regarding unemployment insurance (Caroli 2008). In 1936, she started her own daily syndicated newspaper column â€Å"My Day† (2008). This was her channel for expressions her opinion publicly. While some greeted her write-up with criticisms, many people admired her for taking interest in their plight. She often tackled child welfare, racial minorities, housing reform and women equality (2008). Following her husband’s death in 1945, President Harry Truman her to the US delegation in the United Nations (UN) (Caroli 2008). She was responsible for the drafting and adoption of the Universal Declaration of Human Rights (UDHR) (2008). The UDHR was approved on Dec. 10, 1948 at a U. N meeting in Paris, for which the former First Lady received a standing ovation from the delegates (Gardner 1988). The UDHR is deemed the touchstone of human rights (1988). It is also used to measure the performance of UN entities and NGOs (1988). Likewise, the UDHR continued to serve as inspiration for other human rights treaties in Europe and Latin American (1988). Based on the American Bill or Rights, the British Magna Carta, and the French Declaration of the Rights of the Man, the UDHD comprises a preamble and 30 articles on basic rights and freedoms (1988). When John F. Kennedy became president, she appointed Eleanor as chair of the Commission on the Status of Women (Caroli 2008). She continued to work and fought for the underprivileged. Even at her age, Eleanor travelled the globe to conduct meetings with world leaders (2008). She also did not stop writing books and articles. In 1962, she contacted a rare form of tuberculosis and succumbed. She was buried at Hyde Park. Works Cited Black, Allida. â€Å"Anna Eleanor Roosevelt. † The Eleanor Roosevelt Papers Project. Jan. 31, 2008. May 7, 2008 http://www. gwu. edu/~erpapers/. Bragdon, Henry, Samuel McCutchen and Donald Ritchie. History of a Free Nation. Ohio: McGraw-Hill, 1996. Caroli, Betty. â€Å"Eleanor Roosevelt. † Britannica. com. 2008. May 7, 2008 http://www. britannica. com. Gardner, Richard. â€Å"Eleanor Roosevelt’s Legacy: Human Rights. † Dec. 10, 1988. May 7, 2008 http://www. nytimes. com. Goodwin, Doris. â€Å"Leaders and Revolutionaries. † TIME. com April 13, 1998. May 7, 2008 http://www. time. com. Lewis, Jone. â€Å"Eleanor Roosevelt Quotes. † Womenhistory. about. com 2008 May 7, 2008 http://www. womenhistory. about. com. Tindall, George and David Shi. America A Narrative History 5th ed. USA:W. W. Norton and Company, 1999.

Transitional Justice in Post-war Societies

Transitional Justice in Post-war Societies Introduction 462 What justice is, who it serves to and what forms it can take are the issues that have been challenging philosophers, legal and political scientists for centuries making them search for answers in religious norms, in the rule of law, or even in fairness itself (Ralws 1985). Reasonably, during the periods of transitions and far-reaching transformations of societies this task nevertheless resembles more a Sisyphean one since what is fair and just in extraordinary political circumstances is determined not from an idealized archimedean point, but from the transitional point itself (Teitel 2000, 224). Since every transition is a highly complex and historically contingent process, the act of tailoring an appropriate response to a repressive past is influenced by a number of factors, such as affected societys legacy of injustice, its legal culture, and political traditions (Teitel 2000, 2019). Nevertheless, not all scholars agree on this, but fully reject the relevance of these and similar f actors, considering the transitional qualifier misleading since it suggests an altered and unacceptable lesser form of regular criminal justice (Olsen, Payne and Reiter 2010, 10). This fault line leads to and further shapes another fundamental debate surrounding transitional justice whether the attitudes toward justice are relevant or not, i.e. whether the purpose of justice will be fulfilled if those who it should serve to do not see it fair. Recognizing a wide scope of political transitions and significant differences among them, this paper attempts to analyse the importance of how justice is perceived in the communities emerging from a violent conflict. Such complex environment abound with perplexity, sentiments, irrational thinking and behaviour undoubtedly prevents us from reaching clean and neat explanations of the relationship between justice and its perceptions, but at the same time reminds us of how vital this relation is to the future of transitional justice including its prospects for improvement. The main argument of this paper is that transitional justice in post-war societies will have limited success and will most likely create new grievances among affected societies if they tend to perceive the exercised justice as unfair. However, we warn against the trap of tautology of any kind and call for further research on the possibility, as well as the necessity of overcoming this inherent weakness of transitional justice in post-war circumstances. Upon setting up the theoretical framework, the paper will analyse in which manner broadly negative perceptions of transitional justice affect the success of its both retributive and restorative efforts and contribute to existing frictions between affected post-war communities. Supporting evidence to proposed hypotheses will be sought in the legacy of International Criminal Tribunal for the former Yugoslavia (ICTY). Finally, the third chapter will shortly discuss the chances for achieving transitional justice that is widely perceived as fair by the societies emerging from wars. Holistic Approach to Transitional Justice 492 Looking into definitions of transitional justice, one can notice two main approaches (Olsen, Payne and Reiter 2010, 12; Kaspas 2008, Clark 2008), coinciding and echoing the parts of the sentence we discuss in this paper. Offering different, sometimes opposing forms and mechanisms of transitional justice, these approaches differ in the aims they strive to achieve, or at least, in the order of their priorities. A narrower, retributive approach to transitional justice aims to hold perpetrators individually accountable for their wrongdoings, to punish them, and in such way bring justice to victims. Those who advocate for it are therefore primarily concerned about the fairness of the prosecutorial forms of justice (e.g. trials) where fairness is associated with traditional legal standards (Moghalu 2011, 522-524) and they are not much interested in the way justice is perceived. Although the name suggests otherwise, the restorative approach to transitional justice is more forward-looking and it attempts to bring justice by working toward a new inclusive society that addresses the fundamental needs of population (Olsen, Payne and Reiter 2010, 12) through retributive, but also via a wide range of non-prosecutorial mechanisms (truth commissions, reparations, memorialization, etc.) Being concerned about repairing harm and building and healing societies (Lederach 2001, 842), scholars and policy makers arguing for this approach are more concerned about the way these societies perceive transitional justice and tend to value the justice which restores community, rather than the justice which destroys it (Lambourne 2003, 24). In this paper we adopt a rather comprehensive, holistic definition of transitional justice offered by International Centre for Transitional Justice (ICTJ): Transitional justice is a response to systematic or widespread violations of human rights. It seeks recognition for the victims and to promote possibilities for peace, reconciliation, and democracy. (ICTJ 2009, 1) Even though some scholars argue that including both retributive and restorative efforts dilutes the notion of justice (Olsen, Payne and Reiter 2010, 12), we believe that this kind of definition is the most appropriate one for the following analysis for two reasons. First, it does not exclude or favour, but encompasses the aims of both retributive and restorative efforts, thus providing a basis for a more comprehensive analysis of the impact of justice perceptions on all its aims. Second, such a broad definition is suitable for analysing the importance of how justice is perceived in post-war environments since even though it is almost never possible to punish all those who committed crimes nor to recognize all those who suffered during the mass violence, the survivors both victims and perpetrators will have to find their own ways to live together and to deal with the exercised justice, be that in a constructive, ignorant or a destructive manner. Since the aim of this paper is to evaluate the impact of perceptions of transitional justice on its ability to serve its purpose, we will analyse the aims which stand behind restorative and retributive efforts, but not various forms they can take. Retributive efforts 624 Aiming to establish individual criminal accountability and pursuing an idealistic goal of universal legal fairness, the retributive approach to transitional justice neglects the importance, if not the centrality of fairness perceptions and thus jeopardizes a suboptimal goal of legalist justice deterring future wrongdoings.[1] Nonetheless, the capacity of transitional justice to prevent similar offences in post-conflict societies is indeed impacted by these societies attitudes towards exercised justice. The establishment of individual criminal guilt for punishable acts is supposed to mitigate the dangerous culture of collective guilt (Kritz 1999, 169) which threatens by its two equally perilous extremes blaming all members of the rivalry groups only because of their group characteristics or, conversely, falling into if everyone is guilty, than no one is guilty trap. By punishing individuals who purported to act in the name of the whole ethnicity or nation, retributive transitional justice efforts are assumed to dissolute dichotomist perceptions and nihilistic stereotypes which stigmatize entire communities and might lead to a new round of violence (Kaspas 2008, 62) and acts of private revenge. Nevertheless, no matter how successful trials in the aftermath of war might be, their unavoidable selectivity almost inevitably creates an impression of unequal treatment and unfairness among affected communities thus fostering instead of overturning their distorted group-specific conceptions and perceptions of justice (Weinstein and Stover 2006, 11) Hence, if affected communities perceive the exercised justice as unfair regardless of its legal fairness, the truth that trials aimed to establish will remain to be viewed through lenses of societal guilt (Subotic 2011) and not only that trust among communities will not be rebuilt, but more importantly from the aspect of retributive justice their trust in the rule of law will not be restored. Consequently, the deterring capacity of transitional justice will be considerably undermined. Moreover, widely-perceived-as-unfair justice may incentivise new circle of private justice by reifying divides and hostile attitudes which caused violence in the first place (Sriram 2007, 587). The reason for which the perceptions of justice are particularly important in post-war transitions, even more than in any other type of transition, is because these communities are often caught in a security dilemma which tends to get intensified in the aftermath of a war (Posen 1993, 36). If transitional justice is perceived as unfair, it will most likely create new grievances and simply institutionalize group-specific narratives that affect societies shaped by their self-understanding of sources of coercion and repression in past (Teitel 2000, 224), thus encouraging calls for revision and redressing of perceived injustices. Therefore, the attitudes that post-war societies adopt about the exercised transitional justice can not only undermine its deterring efforts, but even turn them upside do wn. This, however, does not mean that widely-perceived-as-fair justice leads to absolute success of retributive efforts it is not the case even in regular circumstances since people are not always rational actors and have different perceptions of costs and benefits, especially when their vital interests are at stake. Nonetheless, this means that deterrence capability of transitional justice is more limited if it is seen as unfair, which is especially dangerous in the transitions from war to peace, when chances for the recurrence of violence are still critically high (Collier, Hoeffler and SÃ ¶derbom 2004). However, the question then arises as whether this technocratic legalism (Sharp 2013, 150) which strives to present justice as neutral and immune to underlying political tensions can ever be sufficiently fair to post-war societies, or some correctives of fairness perceptions are always needed if communities previously in war are to be kept away from a new circle of violence, either o pen or structural. This brings us to the restorative efforts of transitional justice. Restorative efforts 681 Searching for equilibrium between the demands of justice and peace, the primary aim of restorative efforts is a successful transformation of societies previously in war towards more peaceful, inclusive, democratic, or to use an umbrella term reconciled ones (Bloomfield 2006, 16; ICTY 2009, Loyle and Davenport 2015; Uprimny and Saffon, 2006). Since the accomplishment of this aim requires active participation of the communities (even though the focus is on the victims, the involvement of both victims and offenders is equally important) (Kaspis 2008, 64), their attitudes toward exercised transitional justice are of vital importance for successful transformation. Since negative attitudes towards the exercised transitional justice significantly hinder its deterring capacity, it is not hard to assume how crucial they are for building far more demanding positive elements of peace political, economic and societal reconstruction of communities emerging from a war. What is fair and just in the periods of transition is not determined in a vacuum, but is forged against the affected societys backdrop of historical legacies of injustice which is the springboard for its imagination of transitional justice (Teitell 2000, 224). If exercised justice collides with this imagination of justice, transitional justice efforts risk falling into irrelevance or worse. Empirical evidences from various peace-building missions support this assumption since even those reconciliation efforts that come from the local civil societies tend to have rather limited success if truth and justice behind them are negatively perceived by affected communities (Andrieu 2010, Backer 2003, Rangelov 2015). Forgiveness and healing at which reconciliation aims are unthinkable in the societies which believe that exercised justice is unfair, partial, insufficient, and that it needs to be revised since their sense of justice prevents them from movingÂÂ   beyond negative coexistence (Bloomfield 2006, 14). Moreover, transitional justice which is widely perceived as unfair can even harm such cold peace between the communities previously in war. It is highly unlikely that transitional justice will have legitimizing and democratizing effect for implementing regimes (Loyle and Davenport 2015, 129) if people perceive transitional justice only as the legitimization of a new kind of repression (Stover, Megally and Mufti, 2005). Political entrepreneurs (Lemay-Hebert 2009, 28) who often appear in the aftermath of wars and during transition periods might try to manipulate these attitudes, fuel ethnocentric and nationalistic beliefs and reactions and further obstruct reconstruction efforts. Therefore, if transitional justice adds a new layer of already complex grievances among the rival communities, the process of change and redefinition of relationships between them (Ledarch 2001, 842) will hardly move towards mutual trust, empathy and harmony, but will rather be rebuilt on fear, suspicion and m utual accusations. Therefore, in fragile, post-conflict societies, the perception of justice is often as important as its delivery (Neuffer 2000, 340). However, regardless of how consistent these assumptions on the importance of perceptions of transitional justice might seem for the accomplishment of its ambitious aims, they must not at all be taken for granted. It would be naÃÆ'Â ¯ve to assume that widely-perceived-as-fair transitional justice necessarily leads to peaceful, democratic and reconciled societies. Not only do many other factors beside justice mechanisms play extremely important role in the transformation from war to peace, but perceptions of fairness themselves can be key spoilers of the real transition towards peace, democracy and reconciliation. What caused or, at least, justified the violence in the first place were those mass hostile attitudes fostered by the reservoirs of myths (King 2001, 167) of ethnic and national animosities (Kaufman 2006). If the exercised transitional justice is widely perceived as fair through these corrupted lenses, the nature of these positive attitudes needs to be considered with more attention. If these attitudes are based on the knowledge and acknowledgment of committed war crimes, they probably mean a step forward towards the aims of transitional justice. However if they are met at the expense of fairness of justice, they most likely undermine the prospects for profound transformation of the affected societies. Therefore, the relationship between the aims of transitional justice and the perceptions of affected communities in post-war transitions is extremely sensitive and complex, thus requiring a case-to-case examination. The Legacy of the ICTY More than Trials? 367 Academic debates on the legacy of the ICTY (established in May 1993 to try those responsible for violations of international humanitarian law committed in the territory of the former Yugoslavia since 1991 (United Nations 2009)) very well reflect the general debates on the role of transitional justice and the importance of the affected communities attitudes towards it. Despite a strong consensus on the ICTYs contribution to the development of international criminal justice (Steinberg 2011), the long-term impact of the ICTY on the communities in the region of former Yugoslavia remains largely disputed. Namely, even though the ICTY is a prosecutorial, retributive mechanism of transitional justice, the expectations out of it have been much greater than those from regular courts, and it has been ascribed with restorative potential from the very beginning (. The ICTY was, according to prevailing public opinion, supposed to contribute to the healing of communities in the Balkans and the reb uilding of their inter-communitarian ties. Although substantially unrealistic, these expectations did not emerge out of thin air since the founders of the ICTY indeed set high objectives at the Tribunal. According to the Statute of the ICTY, the primary objective of the tribunal was to prosecute persons responsible for serious violations of international humanitarian law, but also to contribute to the restoration and maintenance of peace and security in the region (UN 1993), which undoubtedly encompassed some of the restorative aims in addition to the regular prosecutorial aims of trials. Moreover, the record of the debate at the Security Council suggests that the seeds for another goal that of promoting reconciliation and good neighbourliness were planted at the ICTYs inception (Fletcher and Weinstein 2004, 36). Dealing with the way and the extent to which the perceptions of the ICTY influenced the effectiveness of its retributive and restorative efforts, we look for the answer to the concerns raised by the ICTY Judge Gabrielle Kirk McDonald, who, during her visit to Bosnia, faced a disappointing lack of knowledge and misunderstanding of the Tribunals work among the local populations. You know, I am wondering if this is all worth it. Im wondering if what we are doing at the Tribunal is worthwhile, she said (Neuffer 2000, 354). ICTY Retributive Efforts Preventing New War Crimes 1070 Indicating 161 alleged war criminals (ICTY 2016), most of whom have already been convicted, the ICTY has undoubtedly developed and impressive body of jurisprudence and louder and clearer than ever announced the end of impunity for those who commit war crimes. Nevertheless, the very existence and work of the ICTY have never been favourably regarded in the countries where its deterrent effects should have been most pronounced (Dimitrijevic 2009, 83) since it has been met with great suspicion, disapproval and resistance by the majority of people in the Western Balkans. Despite the fact that the ICTY was established to punish war crimes of all sides to the conflict in comparison to the very limited, even discriminatory mandate of the International Criminal Tribunal for Rwanda (Loyle and Davenport 2015) its legitimacy in the region has remained remarkably low among all three communities with 71% of people in Serbia, 84% in Republika Srpska, 64% in Croatia and 39% in Federation having su m negative attitudes towards the ICTY almost twenty years after its establishment (Milanovic 2016, 240). The Serbs view the ICTY as a political anti-Serb tribunal, as a one more instrument of the Western powers whose purpose is to dispense victors justice and blame the Serbs for all the atrocities in the wars (Obradovic-Wochnik 2009; Dimirijevic 2009; Saxon 2006). The Croats believe that the Tribunal unacceptably equates the guilt of the Serbs and the Croats, making a massive wound on Croatias body by trying the best of all Croatian sons and thus attacking on the dignity and the legitimacy of the Homeland War (Dimitrijevic 2009, 84; Peskin and Boduszynski 2003, 1117; Jovic 2009, 15). Finally, the ICTY is a mixed bag (Saxon 2006, 564) of hopes and disappointments for the Muslim community which appreciates the ICTYs so far efforts and achievements, but at the same time considers them slow, mild and insufficient (Milanovic 2016, 242). Root causes of these attitudes are multitude and ar e beyond the scope of this analysis. However, what is important to notice is that even though the ICTY has done a remarkable job, in the eyes of the affected communities that job has remained somewhere else and the ICTY has become a world unto itself (Fletcher and Weinstein 2004, 33). Consequently, its negative image has hindered the efficiency of its sentences and undermined its pedagogical role in changing the attitudes towards war crimes in the region. If retributive efforts of the ICTY were successful, all sides would be ready to admit the crimes committed by their communities and recognize the victims of others sides, realizing that exercised violence should have never happened and must never be repeated. However, since significant parts among all the communities do not believe that the trials were fair and do not believe in what was established in the judgements (Milanovic 2016, 242), their persistence of their attitudes towards committed war crimes come as no surprise. Despite the extant of the facts established in front of the ICTY, they are still perceived through the lenses of nationalistic and ethnocentric narratives and myths full of self-victimhood and denial of its wrongdoings (Milanovic 2016, 243). For instance, 75.9% of Serbs and 76.2% of Croats in Bosnia believe that the members of their own community fought a defensively oriented war (Kostic 2012, 655), 74% Serbs and 43% of Croats believe that their communities were the greatest victims (Milanovic, 2016, 243-244), while only 5% of Serbs and 0.4% of Croats think that their coethnics were the greatest perpetrators (Milanovic, 2016, 243-244), even though neither of these communities had the largest number of victims or the smallest number of victimizers according to the facts established by the ICTY and the domestic courts. The lack of the recognition of war crimes is maintained through the lack of the knowledge of the facts on these crimes, which is from its side maintained through the ignorance and refusal of the justice, perceived as unfair. Many surveys show that the facts, evidences and judgements which the ICTY has made available to the public have been routinely rejected and have not influenced the attitudes these communities have towards the committed crimes (Obradovic-Wochnik 2009, 34). Moreover, perceived as unjust and unfair, the truth on war crimes which the ICTY aimed to reveal has given new impulses to old truths rooted in each of th e communities and manipulated by their greedy political leaders the truths which have throughout the history of the region justified even the worst atrocities and turned them into the acts of national heroism. The fact that the justice exercised in front of the ICTY is not owned by the locals since it has not made them recognize the victims of other sides or admit the crimes committed in the name of and by their own side, indeed limits the deterring capacity of the ICTY to a rather modest range. Nevertheless, it would be against the grain to claim that the retributive efforts of the ICTY have not been real and observable, nor is that the aim of this paper. Without the ICTY and the pressure of the international community, not only that the high-ranking political and military leaders from the region would have ever been tried, but even the persecutions of mid- or low-level offenders before the national courts of these states would be less likely. Therefore, we do not claim that the ICTYs retributive efforts have completely failed, but question their scope due to the low legitimacy of the ICTY among the communities in the region of the former Yugoslavia. There is no doubt that the main retributive aim of transitional justice the prevention of similar wrongdoings in future would have been achieved with greater certainty if the exercised justice were perceived as fair. The ICTY has failed twice already to deter the commission of war crimes in the Yugoslav conflicts since some o f the worst atrocities were committed after the establishment of the Tribunal first in Bosnia in the period from 1993 to 1995, and then in Kosovo in the period from 1998 to1999. Unfortunately, media reports on the crowds and government officials in Croatia welcoming Blaskic, or in Bosnia welcoming Krajisnik and Plavsic, or in Serbia welcoming Ojdanic and Lazarevic all convicted war criminals suggest that the legalistic fairness and retributive efforts of the ICTY have failed to root out dangerous attitudes these communities have towards war crimes. ICTY Restorative Efforts Preventing New Wars 931 The above mentioned surveys show that even though the negative peace among the Serbs, Croats and Bosniaks has been preserved for the last twenty years, their war on truth is far from an end despite all the ICTYs efforts and achievements (Hodzic 2015). The capacity of the ICTY to bring peace to these memory wars and put the former enemies on the path of reconciliation is considerably limited by its low credibility among the targeted audiences. In 2005, strikingly small 16.7% of people in Bosnia perceived the trials at the Tribunal as fair and only 26% of them believed that these trials were a precondition for just peaceful and normal relations in the region (Kostic 2012, 659). The disappointment among all three ethnic groups with fairness and relevance of the ICTY further increased by 2010 (Kostic 2012, 659). Hence, the relationship between the local populace and the Tribunal a crucial dimension for its success (Fletcher and Weinstein 2004, 44) has remained weak, limiting its contri bution to peace, stability and reconciliation in the Balkans. Perceived as unfair, the ICTY has had little chances to change the way the past is integrated and spoken between the Serbs, Bosniaks and Croats, to reconcile their contradictory versions of the truth, and to incentivize them to base their relationships on the present instead of the past (Hayner 2011). The public discourse which especially in Republika Srpska, Serbia and Croatia securitized the ICTY as an unfair political court pushed the ICTY into a transitional justice security dilemma among the Serbs, Croats and Bosniaks in which every side believed that the conviction of its nationals represented a threat to its societal security. This created a wall of risky indifference, silence and denial between these communities and the Tribunal, so the ICTY operates in a bias-driven downward spiral the more it challenges rooted nationalist narratives of each side, the more likely that it will generate distrust, and hence less likely that it will be perceived as fair (Milanovic 2016, 259). Not considered fair, hardly can it contribute to sustainable peace, democracy and reconciliation in the region. Moreover, the negative attitudes towards the ICTY have been often misused against reconciliation the very thing which transitional justice aims to foster. Democratically elected leaders in the region have been manipulating peoples perceptions of the ICTY from the very beginning, passing them through cognitive and emotional filters of prior beliefs and attitudes of these communities, thus preserving national narratives full of competitive victimhood (Subotic 2011, Dimitrijevic 2008, Jovic 2009, Fischer and Simic 2016). This has been particularly evident in election campaigns of national political elites of all three communities, who would mobilize this resentment in order to score cheap political points. For instance, trying to recover from what seemed to be a disastrous loss of support in 2000-2001 and prepare for the parliamentary elections in 2003, the Croatian Democratic Union (HDZ) organised massive public protests against the ICTY and the indictment against noble Mirko Norac (t he General of the Croatian Army who was later convicted for war crimes), sometimes gathering more than 150.000 supporters (Jovic 2009, 15). It was by its sharp criticism of the ICTY that the HDZ reinvented itself and staged a quick comeback by taking a convincing victory in 2003 (Jovic 2009, 16). The most recent example is the Serbian Radical Party which regained its political influence and power by re-entering the Parliament after years of decreasing popular support. The most important reason for such development is the acquittal of its leader Vojislav Seselj before the ICTY, which was framed as his victory over The Hague by the Serbian radicals and the media close to them (Nikolic 2016). Many people in Serbia perceived this as a kind of correction of injustice imposed to the Serbian people by the Tribunal and the West. Therefore, the ICTY has over the years served as deus ex machina to many political actors in the region. However, these assumptions do not outspeak the main counter-argument that the situation in regards to peace and reconciliation in the region would have been worse had it not been for the ICTY. Even if some indictments or verdicts were perceived as unfair by the coethnics of alleged or condemned war criminals, the fact that they were removed from the post-Yugoslav political scene was already a significant contribution to the regional peace and security. Providing the opportunity for many victims to talk about their sufferings for the first time, the ICTY has undoubtedly open the way for a long and difficult process of reconciliation among the Bosniaks, Croats and Serbs. Nonetheless, this paper aims to emphasize that the efforts of the ICTY in combatting denial and preventing attempts at revisionism (ICTY) and its capacity to make it impossible for anyone to dispute the reality of the horrors that took place (ICTY), would have been much more successful if the exercised justice had bee n perceived as fair by the affected communities. The anniversaries of the worst war crimes in the region from the Srebrenica genocide, over the Vukovar massacre, to the Operations Flash and Storm every year warn how shallowly the hatchets were buried and how far positive peace and reconciliation seem to be despite all the truth-seeking and truth-telling at hundreds of trials. The justice that these trials brought remained trapped in the unfavourable perceptions of these communities. Nevertheless, risking returning to the very beginning and compromising our main claim, we cannot resist but raise a new question: Could the ICTY ever been perceived as fair by the Serbs, Croats and Bosniaks? (In)Surmountable Weakness? 666 Aiming to serve to all the survivors of mass violence (Shaw and Wladorf 2000, 3) direct victims, direct victimizers and members of both victim and offender communities -transitional justice in post-war societies addresses diverse audiences with considerably different experiences and interests that decisively shape their attitudes towards the exercised justice. Even though we have shown that negative attitudes towards transitional justice limit its accomplishments, we need to raise rather than answer at least two new questions. The most fundamental issue is how realistic it actually is to expect from all the sides in conflict to agree with exercised transitional justice and perceive it as fair (Bloomfield 2006, 20). When large-scale violence is committed, the way people perceive justice is not shaped only by their own suffering, but by the suffering of all members of the group they belong to since their membership in that group is what made them victims in the first place. Since no transitional justice mechanism is capable to punish all wrongdoings, even the best one will be insufficiently fair for the affected communities. This is especially problematic after civil wars when groups in conflict were often both victimized and acted as victimizers (Kaminski, Nalepa and ONeill 2006, 301), while after the war every side simply wants to see its own needs for justice met, not caring, even denying victims of the other side. The strong notion of reconciliation further fuels the distrust of former enemies