reveals a longitudinal section of a circular tube with a length of l = 300 m. Additionally, the absolute roughness of the boundary, the diameter of the circular tube, the continuous loss over the whole length and the kinematic viscosity of the real fluid are given. Longitudinal section of a steel tube Given l = 300 m k = 1 mm d = 1.00 m hLoss, continuous = 0.50 m ν = 1.3 * 10-6 m2 /s For a similar system the continuous loss coefficient λ was derived to λ = 0.02. i)

Prove, if this λ – value can be applied here to calculate the discharge in the circular tube by clearly showing your way (intermediate steps) of proof using the Moodydiagram.

ii) Calculate the discharge Q running through the circular pipe.

Nick Leeson’s adolescence was spent at Watford, UK where he attended high school. After that, he began to work at Coutts & Company and then spent two years at Morgan Stanley, taking up a position as an operation assistant. The experience allowed him to become familiar with the financial markets. Leeson then joined Barings. Founded in 1762 by Johann Barings, the Barings Bank was part of England’s history and even the Queen of England was among its clients. Barings was later considered one of the most prestigious financial institutions in the world. Leeson quickly made an impression within the respected establishment.

In 1990, at the age of 25, Leeson was appointed manager of the Singapore operation to oversee the “futures” operation in SIMEX (Singapore International Monetary Exchange). Leeson quickly became a well-known operator of the derivative market on the SIMEX. From 1992, Leeson made trades that brought in huge contributions for Barings - up to 10% of the bank’s profits at the end of 1993. The profits instilled confidence in the directors who lacked knowledge in subtle trading techniques and financial markets. He became a star within the organisation, earning unlimited trust from the headquarters. He enjoyed unlimited freedom within the Singapore office: he was head of the dealing desk (front office) but he also supervised the back office.

Leeson was in fact losing money and was hiding his losses in an error account, Z88888. He claimed that the account had been opened in order to correct an error made by an inexperienced member of the team. At the same time, Leeson withheld documents from auditors of the bank. By the end of 1994, his total losses amounted to almost half of the capital of Barings. On January 16th, 1995, with the aim of "recovering" his losses, he took even more risky positions. However, the unexpected earthquake of Kobé shattered his strategy. As a result, the losses amounted to more than double the bank’s capital which the bank were unable to absorb. Leeson decided to flee Singapore and was later arrested in Europe. He was extradited back to Singapore and sentenced to 6.5 years of imprisonment. In March 1995, the bank was bought by a Dutch insurance company at a very low price.

1. Are there any problems with the internal control system of Barings? Explain.

2. Are there any problems with corporate governance in Barings? Explain.

3. What is risk management? Why is it needed? What should be the risk management strategy of an international bank like Barings?

4. What are the major risks faced by an international bank? What are the major risks involved in this case?

5. Explain risk appetite, risk tolerance and risk profile.

6. What are the responsibilities of the internal audit function regarding risk management? Who (or which function in an organization) should ultimately be held responsible for risk management in a listed company?

7. Outline the risk management regulatory requirements imposed to international banks after the Barings case.

Consider a UK-based importer of bicycles, Italian bicycles, who has a €160,000 payable due in one year. He wants to use options to hedge the cost of his payable. One-year at-the-money put and call options on €10,000 exist. The spot exchange rates are €1.00 = $1.120 and £1.00 = $1.400, which makes the spot cross rate €1.00 = £0.80. In the next period, the euro can increase in pound value to £1.00/€1.00 or fall to £0.64/€1.00. The interest rate in dollars is i$ = 0%; the interest rate in euro is i€ = 5.00%; the interest rate in pounds is i£ = 7.10%. -How many at-the-money puts (on €10,000 strike price in £8,000) should he sell today?

HINT: You should be able to verify that your hedge "works" if the exchange rate at time 1 is £1.00/€ or £0.64/€ i.e. you should have the same cash flow in either state.

Consider a UK-based importer of bicycles, Italian bicycles, who has a €160,000 payable due in one year. He wants to use options to hedge the cost of his payable. One-year at-the-money put and call options on €10,000 exist. The spot exchange rates are €1.00 = $1.120 and £1.00 = $1.400, which makes the spot cross rate €1.00 = £0.80. In the next period, the euro can increase in pound value to £1.00/€1.00 or fall to £0.64/€1.00. The interest rate in dollars is i$ = 0%; the interest rate in euro is i€ = 5.00%; the interest rate in pounds is i£ = 7.10%. -How many at-the-money puts (on €10,000 strike price in £8,000) should he sell today? HINT: You should be able to verify that your hedge "works" if the exchange rate at time 1 is £1.00/€ or £0.64/€ i.e. you should have the same cash flow in either state.

Accounting firm KPMG's UK offices wanted to decrease payroll costs while maintaining the company's commitment to its employees. So KPMG gave its UK-based employees the choice of either volunteering for a four-day workweek at 90 percent of their salary (80 percent if fewer than 75 percent of employees signed up); a four- to twelve-week sabbatical at 30 percent of their base pay; either or both; or neither. Volunteering for the program, called Flexible Futures, triggered an eighteen-month change in the employee's employment contract giving KMPG the right to exercise the chosen option if and when it needed to. This allowed the company to reduce employee hours and pay on short notice and reduce the need for large-scale staff reductions if economic challenges arose.

To educate employees about their options, KPMG held conference calls, trained managers to answer potential questions, and posted a long list of questions and answers on a dedicated Flexible Futures page on its intranet. The website also included a calculator to enable employees to easily calculate what their take-home pay would be under any of the options. A link to KPMG's corporate responsibility website helped connect employees interested in sabbaticals with nonprofit organizations that needed accounting expertise.

Flexible Futures gives employees greater job security and control over their own destiny. This has allowed them to worry less about their jobs and focus more on their clients. More than 85 percent of KPMG employees signed up for at least one of the options. KPMG expects this to save the company up to 15 percent of payroll costs and to boost employee morale.

1. How does this program help KPMG?

2. How does this program help KPMG's employees?

3. If you were employed by KPMG, would this program appeal to you? Why or why not?

QUESTION ONE
The data below represent statistics and probability end of semester examination marks of 30
students randomly selected from the population of students who registered for probability and
statistics during 2018/2019 academic year.
16 51 36 45 23 48
37 19 28 28 25 36
76 22 27 18 28 42
38 47 44 29 37 42
27 33 35 46 28 27
Using sturge’s approximation rule with all your answers in one decimal place,
construct a frequency distribution table as follows
Class
Boundary
Tally Frequency Class
midpoint
CF FX FX^2
Calculate the coefficient of skewness for the data set and interpret our result.

QUESTION TWO
Suppose that the operations manager of a nose mask packaging delivery service is
contemplating the purchase of a new fleet of trucks during this COVID-19 period. When
packages are efficiently stored in the trucks in preparation for delivery, two major constraints
have to be considered. The weight in pounds and volume in cubic feet for each item. Now
suppose that in a sample of 200 packages the average weight is 26.0 pounds with a standard
deviation of 3.9 pounds. In addition suppose that the average volume for each of these
packages is 8.8 cubic feet with standard deviation of 2.2 cubic feet. How can we compare the
variation of the weight and volume?

QUESTION THREE
The marketing director of GH HOTEL was interested in studying the intention of consumers
to visit their facility after the president has fully lifted the restriction on public gathering in
2020 and as a follow- up, whether they in fact actually visited. Suppose that a sample of 1000
household was initially selected and the respondents were asked whether they planned to visit
GH HOTEL. Twelve months later the same respondents were asked whether they actually
visited the hotel. The results are summarized in the table below
Planned to visit
Actual visit
Yes No Total
Yes 200 50 250
No 100 650 750
Total 300 700 1000
i. Draw a tree diagram to represent the information in the table.
ii. Find the probability of selecting a respondent who actually visited GH HOTEL.
Interpret your answer in a simple single sentence.
iii. Find the probability of panned visit or actual visit.
iv. Calculate the probability that a respondent actually visited GH HOTEL given that he
or she planned to visit GH HOTEL

The traditional business of banking comprised lending, deposit-taking and the provision of transaction services. Through the first half of the twentieth century, banking was a regulated, local, low risk business based on a customer’s credit worthiness and yielded returns based on interest.

Much has changed, but the mid-century model persists in the popular consciousness. Bank advertising draws heavily on this historical image. During the 1950s, banking had little to do with funds management, where an entity pools and invests money on behalf of customers.

The funds management sector was composed largely of superannuation and life insurance. For reasons discussed below, the reach of this sector was limited until regulatory and financial conditions changed.

In the 1970s, Australia began to deregulate its financial markets. Restrictions on bank interest rates and liability structures were removed; foreign banking was made easier to access; the Australian dollar was floated. The financial sector expanded. At the same time, growth in the size and liquidity of securities markets allowed more diverse financial products to develop.

The next critical steps were the expansion of superannuation, which shifted the responsibility for and control of provision for retirement from employers into the hands of individuals. From 1983, successive changes to the tax treatment of superannuation increased the complexity of superannuation but also established it as a vehicle for compulsory saving. These developments included the incorporation of superannuation into employment awards in 1986 and legislation in 1991 imposing tax penalties where employer contributions were not made.

With greater amounts of savings invested in superannuation funds, Australians now have a far higher exposure to capital markets and since the 1980s Australians have increasingly seen a need for financial advice.

In 2000, CBA acquired Colonial Mutual Life Assurance Ltd, which conducted life and other insurance business, and a funds management business

In 2000, NAB acquired the financial services businesses of Lend Lease, including its MLC Holdings Ltd. advice, platform and superannuation and asset management businesses.

In 2002, ANZ entered joint venture arrangements with ING Group in respect of wealth management and life insurance businesses in Australia and New Zealand, and later acquired the full business.

In 1999, Westpac founded Magnitude Group Pty Ltd. In 2008, as part of its merger with St George Bank Ltd, Westpac acquired St George’s financial advice business, which included employed advisers as well as Securitor Financial Group Ltd. In 2002, Westpac acquired all of BT Financial Group’s asset accumulation businesses.

Scandals dating back to the GFC began to shed light on the conflicts and culture in the financial advice industry.

In their submissions to the Commission, financial services entities acknowledged conduct that amounted to misconduct or conduct falling below community standards and expectations in connection with the provision of financial advice.

Clients of financial advisers or financial advice licensees being charged fees for services not provided to them is now rightly recognised to have been a large and endemic problem in the industry.

Charging for doing what you do not do is dishonest. No-one needs legal advice to tell them that.

https://financialservices.royalcommission.gov.au/Documents/interim-report/interim-report-volume-1.pdf (Links to an external site.)Links to an external site.

1. What are the core traditional functions of commercial banks? (1 mark)
2. How did banks generate profits prior to the 1980s, and what was their attitude to risk? (1 mark)
3. Identify two major changes which happened in the funds management sector of the Australian financial system between the 1970s and the 1990s. (1 mark)
4. How did Australia’s big-4 banks respond to these changes? (1 mark)
5. What is the main problem which arises as a result of providing financial advice and selling investment products in the same organisation? (1 mark)
6. Identify evidence of undesirable cultural change in the banking and financial services sector of the economy in the above extract. (1 mark)
7. Identify and distinguish between the roles played in the Australian banking system by APRA and ASIC. Which of these two institutions appears to have been more heavily criticised by the Royal Commission, and what is the main reason for this criticism?
8. What does it mean to say that the big-4 banks are ‘too big to fail’? Explain your answer clearly and concisely. (1 mark)
9. In what sense do the big-4 banks face a problem of moral hazard? (1 mark)

11. The following is true about natural-logarithm (ln) changes (“log-changes”): a. They can be added together to explain a total log-change. b. They reflect a given dollar gain or loss symmetrically. c. For small changes, they are quite close to percentage changes. c. They are more reliable than percentage changes, which can be misleading. e. All of the above are correct.

12. Regarding financial statements: a. The balance sheet shows what a company owns and owes through time. b. The income statement shows what a company earned at a point in time. c. The cash-flow statement shows changes in revenue and liabilities. c. Both the income statement and the balance sheet show flows in time. e. None of the other choices are correct.

13. Entreprise Value is: a. generally larger than the market value of a company’s total assets. b. the combined value of a company’s assets, debt, and equity. c. the sum of the market value of a company’s debt and equity. c. the market values of interest-bearing debt and equity, net of cash. e. All of the above are correct.