Case 94: Dr. X and the Disappearing Clinical Trials Money

I NEED A CASE WRITE UP DONE BASED ON THIS CASE! AN EXAMPLE HAS BEEN PROVIDED ON THE LAYOUT OF HOW IT NEEDS TO BE DONE

Dr. Xavier, or Dr. X, as he liked to be called, was a newly hired oncologist at a large cancer center at Upstate New York Oncology Center (UNYOC). During his negotiations for the job, he displayed a propensity for the finer things in life and demanded those things be moved from his farm in North Carolina to his new one in New York. The list of his favorite things included: a rare book collection, an antique clock collection, three antique cars (a Bentley, a Rolls Royce, and a Mercedes), a dozen black Orpington show chickens, and two dozen Marino sheep. In addition, his 1,500-bottle wine collection had to be transported from North Carolina to New York in a refrigerated truck. All of these demands were met by UNYOC because Dr. X had a reputation for bringing in clinical trial money for new cancer treatments. In exchange for his hefty salary and transportation costs, the revenues from pharmaceutical firms for his research were to be handed over to UNYOC.

Dr. X worked hard, and as expected, the money began to roll in from the research trials. At his first annual review, Dr. X met with the managing partners of UNYOC and informed them that he felt it was time for them to make him a full partner. After all, he’d brought in revenues from the trials, plus he was a productive member of the team. In his opinion, his net worth to UNYOC far exceeded the salary he received. If they didn’t accede to his request, then he was going to leave and take his huge revenues with him.

The partners were taken aback, to say the least. The senior partner was most vocal with his annoyance. “You’ve got a lot of nerve, Dr. X. You conveniently forget that we have a very high overhead in this practice. Look at all the staff we have. They take care of your every whim. We have state-of-the-art equipment, as well as the best supplies for our patients’ needs. This past year, you’ve barely covered your salary and your direct and indirect costs of services. Full partner, indeed. Harrumph.”

Dr. X was chagrined. He’d expected the partners to cave in, just as they had to his demands during the hiring process. Truth be told, he had been bluffing. There was no other job offer on the table. And his expensive chickens and sheep were eating him out of house and home. He had to do something.

Dr. X thought it best to placate the old man and buy some time. “I’m sorry. I’m really not a business person. I hadn’t considered all the overhead costs. Please forgive me.”

The senior partner raised a shaggy eyebrow, then shrugged. “Well, that’s why we’re here, Dr. X, to keep us all on track. Apology accepted.”

The meeting adjourned. Everyone went back to work, but Dr. X’s mental wheels were spinning. He needed more money. But where would he get it? He was working 60 hours a week;it wasn’t as if he could moonlight. He wasn’t about to give up his books, clocks, cars, and wine. That was unthinkable. And the show chickens were like his children. He couldn’t sell them. Pretty soon it would be time to shear the sheep and get a bundle of cash for their fine wool. But he needed money right now. Where was he going to get it?

He sifted through the mail in his inbox and opened three envelopes with the latest four figure checks from several big drug companies. He realized what he needed to do. The checks from the pharmaceutical firms were all made out to him, not UNYOC. He put the checks in his pocket, walked across the street to his bank and deposited the money to his personal checking account. As he walked back to his office, he felt as if a weight had been lifted off his chest. Soon he’d find another job elsewhere, one where he’d be able to live the lifestyle that he’d become accustomed to and deserved. Problem solved.

USE INFORMATION FROM CASE TO DO A WRITE UP (PLEASE INCLUDE DETAILED EXPLANATION AND COMPLETE ALL 6 STEPS)

1 - Write a background statement

2- What are the major problems and secondary issues?

3- Your Role

4- Organizational Strengths and Weaknesses

5- Alternatives and Recommended Solution

6- Evaluation

THEIR IS AN EXAMPLE BELOW OF HOW THIS SHOULD LOOK!!!!

Case Write-Up

Background Statement

A Wiccan patient who visited a nondenominational community hospital was discussing her religious beliefs with her primary care nurse, Penny Baker, when suddenly another nurse, Ruth Goose, walked into the conversation and rudely stated, “Thou shalt not suffer a witch amongst you.” The Wiccan nurse felt offended and complained that she was discriminated in the hospital because of her religious beliefs.

Major Problems and Secondary Issues

The major problem is that the two nurses, Penny Baker and Ruth Goose, made the patient feel unwelcomed in the nondenominational community hospital because of her Wiccan religious beliefs. The secondary issues that the nondenominational community hospital may face is that the Wiccan patient is threatening to go to the media. This means that there may be news coverage that your hospital engages in religious discrimination. This may make people, especially Wiccans, look down on your medical services.

Your Role

In this case, I am the Vice President of Nursing Services. As stated in the text, it writes, “You are the Vice President of Nursing Services in a nondenominational community hospital, and you receive a complaint from a patient, who is a Wiccan.” The advantages of this role are that I can sit down with Penny and Ruth to let them know that religious discrimination is not to be tolerated while we are caring for the patients. The disadvantages of this role are that I must decide how I am going to discuss this matter with Penny and Ruth because they’re passionate about being against the Wiccan patient. I need to let Penny and Ruth know that our patient’s care matters above everything else, not what religion they practice.

Organizational Strengths and Weaknesses

As the Vice President of Nursing Services, my strengths are that I can hold a training on racial, ethnic, and religious diversity. This training can supplement nurses with the information they need to work in a diverse environment. Nurses need to know that they must treat their patients justly despite their identity. The weaknesses I may face are that the two nurses are very religious themselves. They may not listen to what I have to say about religious discrimination because the two nurses try to justify their act by saying, “She did the right thing. We don’t have to pray with witches. They worship Satan. It’s blasphemy. What’s next? Human sacrifice?”

Alternatives and Recommended Solution

As a solution for this problem, I will make sure to provide all the nurses working in the hospital with diversity training. It is important that I sit down with the nurses and make it clear that discrimination will not be tolerated while they are working in our hospital. I can also offer every patient visiting the hospital with a survey. The patient can fill out the survey to let us know how they felt about their stay. Nurses who’ve been accused of any sort of discrimination, will have to speak with management. We would keep these incidences of discrimination in a file, and it the dilemma does not change, I would have to begin writing up the nurses. Discrimination would not be tolerated while the patient is in the hospital trying to recover from a medical condition. I would also recommend Penny and Ruth write an official letter of apology to the Wiccan patient before she decides to go to the media. Writing the official letter of apology would be my first recommended solution to Penny and Ruth, so that the patient does not feel unwelcomed to our hospital’s services in the future.

Evaluation

If there are enough surveys to prove that our medical treatment is getting better and there are less patients coming from the patients about discrimination, then I would know that the instances of discrimination have stopped. The goal is to aid in the medical recovery of patients. Patients must also feel welcomed to our hospital services despite their identity. By getting fewer, or even better, no discrimination complaints, I would know that my diversity trainings and meetings have worked.

The Patient’s Experience: What Were They Thinking? – Case for Chapter 4

Sheila K. McGinnis

Thanksgiving weekend. Tanya Martinez is looking forward to a busy holiday weekend entertaining her extended family. Tanya, 29, is a busy stay-at-home mom. She has a degree in Business Administration and recently worked in marketing for a major insurance company in the city. Married nearly 8 years ago, Tanya and her husband Alex, 29, have two children. Tanya quit working several years ago to raise their two children, 4-year-old Randy and 2-year-old Samantha. The Martinezes, a multiracial couple, lived in a large city in the Northwest, where Alex works as a skilled construction carpenter on high-rise commercial building projects.

Tanya, Alex, and the kids celebrated the holiday with Tanya’s mom Deidra, a city engineer; dad Michael, a college professor; her brother, a computer engineer; and her sister-in-law, a nurse practitioner. On Friday, Tanya felt some nausea and intestinal discomfort, which she assumed was due to the Thanksgiving festivities. While Tanya was typically active and athletic, she had to skip her usual long-distance run. By Saturday, her condition had quickly worsened. She was weak, vomiting with periodic abdominal pain, and using cold compresses for a high fever.

With Tanya running a 103^o fever Sunday, Alex stayed home with Randy and Samantha, while her parents Deidra and Michael took her to Urgent Care at a nearby full-service medical center. There she was quickly sent to the Emergency Department of the 400+ bed, Level 2 Trauma Center. Various lab tests and a CT scan showed an elevated white blood cell count, but no conclusive findings regarding her non-specific intestinal discomfort. So, after rounds of antibiotics and fluids for dehydration, Tanya was sent home without any prescriptions or further instructions.

Tanya’s condition did not improve by Tuesday, and she was still experiencing a high fever plus nausea, bloating, and abdominal pain. The family brought Tanya back to Urgent Care, where she was sent to the Emergency Department again, and then referred to the main hospital for observation care. Observation care is a hospital outpatient category (even though patients stay overnight). It is controversial because it blurs the lines between outpatient and inpatient care, which often increases the patient’s financial liability (due to larger co-pays). It can also compromise clinical care delivery due to poorer coordination of care during observation stays (Hagland, 2018; Society of Hospital Medicine, 2017).

In the observation care ward, Tanya was seen by several hospitalists who each interacted with her for different purposes and with different questions. They conducted a variety of additional blood draws and lab tests to assess intestinal illnesses such as Crohn’s disease, inflammatory bowel conditions, or possible intestinal blockage. While observation care is intended to take 24 hours, or 48 hours maximum, in practice it sometimes exceeds 48 hours (Society of Hospital Medicine, 2017). Tanya ended up in observation care for 5 days.

Observation ward rooms are shared, and during Tanya’s stay, three different female roommates entered observation care and were admitted to inpatient care shortly thereafter. Tanya’s first roommate did not permit Tanya’s husband Alex to stay overnight with Tanya, so her mother stayed with her each night. Alex, their children, and family were frequent visitors during the 5 days.

One evening when both parents Deidra and Michael were visiting Tanya, they noted two uniformed city police officers in the corridor talking to the in-charge nurse. The pair of officers soon entered Tanya’s room unannounced saying “We have to check your belongings,” without offering any explanation. Tanya and her parents complied but were unclear about what was happening. When one officer asked, “Does she have a history of drug abuse?” Deidra exploded, saying “What are you doing here? Leave right now!” The officer explained “We’ve had calls and a report there have been a lot of visitors and possible illegal drug activities here.” Next, the in-charge nurse burst into the room stating, “It’s a mistake, it’s not this room, it’s another room!” The officers were quickly redirected to search the nearby room occupied by a well-tattooed white male.

Frustrated by days with no clear diagnosis or treatment plan and angered by the allegation his daughter was using drugs, Michael demanded “I want to see the nursing supervisor now or we are leaving this hospital and will sue you!” When the RN supervisor arrived, Michael confronted him “Why did you call the cops on my daughter?” The supervisor wanted to check on what happened and scheduled a meeting for the next day after tempers had cooled.

During a tense meeting with the RN supervisor the next day, her parents sought to transfer Tanya to a different hospital and leave “Against Medical Advice” (AMA). Informed that insurance might not cover an AMA transfer, and that another hospital might not accept an AMA, they “felt like hostages, with no options.” Unwilling to take the risk, the parents compromised that the hospital could transfer Tanya to the medical floor on in-patient status with a private room.

Michael and Deidra also confronted the floor nurses, asking “Why did you send the police to Tanya’s room?” The nurses explained that “somebody had called the cops,” leaving the nurses to guess which patient it might be. A junior nurse admitted she had pointed the police towards Tanya’s room. Even Tanya’s observation ward roommate, who was present when the police arrived, said their treatment from the nurses and officers was inappropriate. The hospital’s security chief apologized and said he “would look into” the incident with the police.

Tanya spent another week as an inpatient on the medical floor. At the time of transfer to inpatient status, she was generally stable, though very weak, and showed few signs of improvement. She was still nauseous, with abdominal distention and cramping, and little bowel activity. The family hoped Tanya’s attentive new physician, Dr. Johnson, would finally get a clear diagnosis and treatment plan. Dr. Johnson arranged for endoscopy and requested other consults, though staff resisted performing a second CT scan (after two previous ones in the ED), saying “she should get better.” Finally, 4 days later, before going off rotation, Dr. Johnson’s written medical report called for a surgical consultation, stipulating that if the hospital could not provide answers and appropriate treatment the patient would need to be transferred to University Hospitals for additional evaluation and care.

At last the third CT scan clearly showed an intestinal ileus—a potentially dangerous stoppage of the normal intestinal contractions that move food through the intestines. While an ileus is commonly a complication of abdominal surgery, Tanya had no history of surgery or medical conditions that lead to an ileus, and prior to her sudden hospitalization had been very healthy and fit. After surgeons drained accumulated fluids and matter from her lower abdomen, they put her on antibiotics, and released her from hospital the next day—after 2 weeks in the hospital. Tanya gradually recovered at home, though it took several months to regain her strength and eventually return to her active lifestyle.

Deidra and Michael filed a complaint on Tanya’s behalf shortly after she was released from hospital. They identified the following substandard practices:

• ■   Abusive encounter: Patient was accused by uniformed police of using drugs without reasonable cause. This incident also raised the question of whether Tanya and her husband came under suspicion because Alex is of Latino/Native American descent.

• ■   Negligence that compromised quality of care: Patient was assigned to observation care for 5 days without clear diagnosis and treatment; patient was admitted on in-patient basis for 5 days and staff resisted taking further action to refine the diagnosis and treat appropriately. The resulting delayed confirmation of an ileus further weakened Tanya and prolonged her time to full recovery months later.

• ■   Observation Notice Requirement: Patient was assigned to and maintained on observation status without sufficient diagnostic efforts, and without explanation of its clinical and financial implications.

The hospital completed its internal review without interviewing Tanya, her family members, or her roommate. While acknowledging the grievance, the hospital’s report concluded Tanya’s care was appropriate.

QUESTIONS

1. What automatic thinking, cognitive biases, and stereotypes may be affecting how each of the actors sees this situation? Include as many as you can think of.

2. What stereotypes or biases might hospital staff hold about a potential drug user?

CITIC Tower II: The Real Option

It was three o’ clock on a hot afternoon in Hong Kong in mid-2000. Larry Yung, Chairman

of Citic Pacific Limited (“CPL”), was having a board meeting with his property development

rd
team. From his window on the 33 floor of Citic Tower, he could see the impressive Victoria

Harbour and an undeveloped prime waterfront site. This piece of reclaimed land had been purchased by a company six months earlier at a public auction. Now, the owner wanted to dispose of it, and hence it was made available to CPL on a first-choice basis through an intermediary. Larry thought CPL could acquire the site and develop it into another Grade A office building in Central — he planned to call it “Citic Tower II”. The asking price of the land was HK$1 billion, and the estimated scale of the building and development costs were comparable to those of Citic Tower. Larry personally wanted to give this deal the go-ahead, but he was hesitant to commit his company to this two-to-three year project without seeking advice from his management team.

At the board meeting, Larry leaned back in his chair and riffled through the feasibility report he had been given. To his disappointment, investing in Citic Tower II did not seem to bring about clear positive returns. Under the rigid assumptions set by the property development team and the Net Present Value Rule, the project reflected a present value of around HK$1.54 billion and a cost of around HK$1.6 billion. Larry intuitively felt that the decision was too deterministic, as it did not allow for any flexibility, managerial discretion or strategic actions. Should he allow the board to reject or go ahead with this project based on discounted cashflow (DCF) analysis alone? If the decision to develop was delayed or otherwise changed, would the full potential of this development opportunity be substantially better than the analysis suggested?

Background

Citic Pacific Limited was incorporated in Hong Kong and listed on the Hong Kong Stock Exchange in 1991. In 2000, infrastructure and related assets formed the cornerstone of CPL’s activities, ranging from civil facilities such as complex bridge, road and tunnel facilities to power generation, environmental projects, aviation and telecommunications. CPL owned extensive trading and distribution interests, particularly in the motor industry, through its wholly owned subsidiary, Dah Chong Hong Limited. It also had stakes in firms such as Cathay Pacific, Dragonair and a string of trading and property companies.

Given the cyclical nature of the market, CPL’s property revenues were significantly less predictable than the revenues from the company’s infrastructure assets, where high proportions of its revenues were contractually defined and recurrent. Property investment projects were generally based on 12 per cent required return on investment based on CLP’s weighted average cost of capital (WACC), with no attempt to differentiate for individual project risk in WACC. Over time, CPL’s property development team had gained extensive expertise and knowledge in the property business. The development of Citic Tower, which began in August 1995, and completed in less than two years, represented an impressive achievement in development management. As at 1999, despite the property market being affected by the post-Asian financial crisis, weak demand and falling prices, Citic Tower still maintained a relatively high occupancy rate.

Larry knew that the commercial real estate market was extremely cyclical, and that very few companies active in the market had managed to time rental cycles and investment strategy successfully (Exhibit 1 shows the Grade A office rental and capital value time series from 1986 to 2001, and Exhibit 2 provides information on recent risk-free rates in Hong Kong). Although Citic Tower I had managed to survive the economic downturn unscathed, there was no guarantee that things would be any easier for Citic Tower II. Given the volatile nature of the market, the mark of a successful project was when the developer knew when to pull in the reins and when to let them out.

With this in mind, Larry thought the outlook for the project could change if it could be deferred or otherwise re-scaled. With a possible negative net present value, launching the project at this point was unambiguously sub-optimal. However, things could change over time. At some point, the property market could be on the upturn again. If Citic Tower II came onto the market at the right time, it might be far more promising than it appeared in mid-2000.

The Real Option

Larry’s doubts about the rigid application of the DCF analysis led to more discussions on the alternatives available surrounding the development of Citic Tower II. At the end of the meeting, Larry was glad that the board did not reject the proposal. In fact, as the debate flared up, members of the property development team floated some useful ideas.

Early investment in the Citic Tower II project meant sacrificing the option to defer the decision to go ahead immediately, which was valuable because of high uncertainties and the long investment horizon associated with the property development industry. One member therefore suggested that the company acquire the rights to the land, and thus the development, by offering to purchase an exclusive option from the seller. The option to purchase the land would allow CPL to defer the decision to develop for one year. Such an option was also not without risks. If the project was truly a winner, waiting would mean loss or deferral of its early cashflows. However, since the project did not appear to be clearly attractive at this point, waiting could prevent a big mistake. On this point all members of the board were in complete agreement. The question, however, was how to lure the seller to accept such an offer.

Negotiations

Three years earlier, land owners would not have even considered negotiating an option to purchase development sites. At that time, commercial development sites were keenly sought

after despite the high land prices. Demand for office space in Central was particularly strong, as its prime location attracted the banking and financial sectors, major accountancy and legal firms as well as regional headquarters of multinational corporations. Multiple offers and aggressive bids were often found at land auctions. However, as the market cooled after the Asian financial crisis, that scenario was no longer the case. Property developers seemed to be more cautious than before, and most preferred to stay on the sidelines.

Given the present economic climate, CPL was hoping that the seller would grant CPL an option to defer purchase of the land, exercisable at the end of one year, thereby allowing CPL to defer the whole project for one year. Two weeks earlier, the seller had reached a new agreement with its banker to restructure its HK$3 billion debts, thereby alleviating its short- term cashflow problems. Under the agreement, the repayment would be extended from two years to three years, including a grace period of 12 months. The refinancing not only provided a big boost to the seller’s share price, but it would also better position both the company and CPL to negotiate more flexible terms for the land sale.

CPL’s early talks with the seller were encouraging. The seller had shown an interest in granting an exclusive option for 12 months. However, as the price of the option, it had requested an equity stake of 5% in the completed project.

The Decision

Larry sat at his desk overlooking the newly reclaimed land on the waterfront of Victoria Harbour. He was a little perplexed about the decision in front of him. The exclusivity option offered additional choices, but at the same time it was difficult to assess. Should CPL accept the terms proposed by the seller? Larry sighed, picked up his jacket and headed for the last board meeting in July. He wondered whether his property development team would still reject the project after two weeks’ study of this decision.

1. What is offered in the exclusivity option?

2. Should CPL accept the terms proposed by the seller? Why?

Typifying Tanzania’s Upward Trajectory

A company that incites financial innovation and socioeconomic development, Barclays Bank Tanzania is gearing up for a new, exciting chapter in its already illustrious history.

The 1990s will go down as a crucial decade in Tanzania history.

A 10-year period characterized by political, social and economic transformation, it witnessed the country’s first successful multi-party election in 1995 and the signing of the progressive East African Community Treaty in 1999 – a cooperative commercial and political agreement between Tanzania, Kenya, and Uganda. The Tanzanian banking sector also embarked on a plan for financial liberalization at this time, part of a country-wide effort to sustain positive economic growth. Through the mobilization of financial resources and bolstered competition this was achieved facilitating greater freedoms amongst domestic banks and welcoming international players that helped to improve the availability of financial services and the quality of existing services. One such enterprise that has risen to the fore as a result is Barclays Bank Tanzania – a firm that has thrived since establishing a national footprint at the turn of the millennium. “The banking industry continues to undergo significant transformation in Tanzania and across the region, driven to a large extent by changing customer demographics, technological advancements and innovation,” explains Abdi Mohamed, the organisation’s Chief Executive Officer. “It’s critical to the growth of the economy, playing a pivotal role in supporting the government’s growth agenda.” A fully-fledged commercial bank serving the retail, business and corporate segments, Barclays has become a spearhead of the progressions that Mohamed refers to. Offering a full suite of deposit and lending products targeted to all key sectors of the economy, the business is well represented across the country with a network of 15 branches and an ATM network of 62. “We’re proud of our relentless focus on customers, competitive products, digital channels and our talented and diverse workforce,” Mohamed adds.

Employee power

The latter of these core focus areas has proven to be crucial to the success of Barclays Tanzania. The company pays particular attention to its employment, training and talent retention strategies, evidenced by its emphasis on providing young people with opportunities. “Young people bring special qualities that enhance diversity in the workplace,” explains Mohamed. They’re often brave, passionate and ready to take on new challenges and inject new ideas – qualities which are critical in finding solutions to today’s problems. “They tend to learn more quickly and have the ability to adapt to change. It is this knack for self-learning and adaptability that we look to explore with the vision of developing great leaders of tomorrow.” These attitudes bode well with its citizenship agenda that again seeks to develop local talent. The company ensures it provides an abundance of opportunities to its workforce, recognising the importance of keeping its skilled staff energised and happy. To this end, the firm has developed a three-stage strategy of hiring, developing and holding onto its best workers. “This people-centric plan includes a multitude of elements,” Mohamed explains. “We pay for performance and provide long term incentives for select organisational leaders over a three-year period, owed to the belief that exceptional staff contribute significantly to our business outcomes. We also consistently benchmark our offerings against the rest of the market, uphold employee engagement to the highest of standards and promote diversity wherever possible.”

Admirable social commitments

The mention of diversity leads the CEO to highlight the firm’s empowerment ethos, the company having developed tailored programmes that support up and coming female leaders and running training partnerships with external entities such as Duke University and the International Institute for Management Development. This responsible, progressive, conscious approach to development does not only apply internally, however. Equally, Barclays Tanzania is positioned as an active force for good, viewing citizenship as a fundamental part of its overall strategy. “We’re all about bringing possibilities to life as we support initiatives that help upskill, empower people and play a part in changing, developing and solving communities’ challenges,” Mohamed explains. These efforts fall under a series of distinct citizenship pillars, the first being enterprise development. The CEO reveals: “We have empowered 810 youth living with and affected by HIV/AIDS by upskilling and training them on entrepreneurship skills. Further, more than 600 young people have benefitted from entrepreneurial skills projects via our incubation and acceleration initiatives.” The company’s education efforts are similarly extensive, having sponsored 25 students for their undergraduate studies at the University of Dar es Salaam and Tanzania Institute of Accountancy. “400 graduates have also been trained on work skills under our placement programmes, and we’ve helped to empower more than 5,000 young people through our ReadytoWork programme,” Mohamed adds. In total, Barclays Tanzania has invested more than a billion Tanzanian shillings ($440,000) in social upliftment efforts over the past four years, be it on donations, education skills, natural disasters, enterprise development and/or financial skills. Additionally, 95 percent of its staff have taken time to share their skills and support communities, particularly hospitals, orphans and other disadvantage children. “We take these commitments very seriously, ensuring that we make a difference in people’s lives,” the Chief Executive reiterates.

A brighter future

Corporate social responsibility aside, the company’s investments extend into a variety of other areas as it seeks to bolster not only surrounding communities but equally its own offerings. Digitisation, for example, is a core part of the firm’s agenda across all business segments right now. “With the future of banks being digital, we have to give our customers products and services that speak to that,” Mohamed reveals. “Within the next six months, you can expect to see a lot of exciting innovations become part of our portfolio.” A major rebrand is also underway for Barclays Tanzania as it gears up to incorporate the name of its parent company, Absa Group Limited. “This is very high on our list of priorities,” Mohamed affirms, stating that Absa’s warm, vibrant red colour palette will soon be appearing across its branches and ATMs during the remainder of 2019 and beyond. “The process is subject to regulatory approvals and we thank our regulators for the ongoing support. “It’s a deliberate move from Absa Group to rebrand all its operations to Absa, as was announced in July 2018. Our legacy will serve us well for the future, and as we enter a new era, you can expect to see the energy and the vibrancy of the Absa brand taking us to new levels.” This rebrand and digital drive combined, the CEO and Barclays Tanzania have every right to be optimistic for the future as the bank becomes ever-more focused on driving value for an ever-widening customer base. Mohamed concludes, once again highlighting the positive climate that is facilitating the firm’s continual transformation: “We’ve seen an increase in industry profitability over the last couple of years, and the overall outlook remains positive. “GDP growth rates, inflation and foreign exchange rates all remain within the target range, and the economy is well diversified with a debt to GDP ratio that is within expectations. “We’re certainly excited about the direction of both country and company as we prepare for an incredible journey of brand transformation.” Source: https://www.africaoutlookmag.com/outlook-features/barclays-bank-tanzania

BASED ON THE ARTICAL ABOVE, DISCUSS HOW BARCLAYS BANK TANZANIA CAN USE ANSOFF'S MATRIX AS A BASIS FOR GROWING THE BRAND IN THE FUTURE.

YOUR ANSWER SHOULD INCLUDE THE FOLLOWING:

A) EXISTING MARKET PENETRATION STRATEGY

B) NEW PRODUCT DEVELOPMENT STRATEGY

C) NEW MARKET DEVELOPMENT STRATEGY

D) DIVERSIFICATION STRATEGY

20 MARKS

1. Calculate the excess returns during the period of study

2. Calculate the average excess return, standard deviation, Skewness and kurtosis using the excel functions

3. Calculate the 5% Value at Risk (VaR) assuming

a) distribution is normal

b) distribution is not normal

c) comment on your findings

In September 2002, the Financial Accounting Standards Board (FASB) of the United States published a discussion paper seeking views on whether U.S. standard setting should move from a principle based approach toward a principle based approach as sometimes associated with the International Accounting Standards Board (IASB). That paper was partly in response to the SarbanesOxley Act, which was itself a response to such accounting scandals as Enron and WorldCom. Schipper (2003) points out that the U.S. rules are often based on principles. That is, the standard setters use principles in order to produce the rules for the preparers of financial statements. Nelson (2003, 91) agrees, and suggests that a particular standard should rather be seen as more or less rules-based. He suggests that rules can increase the accuracy with which standard setters communicate their requirements and can reduce the sort of imprecision that leads to aggressive reporting choices by management. However, he notes that rules can also lead to excessive complexity and to the structuring of transactions. One of the reasons why standards on several topics need to contain rules is that the standards are inconsistent with the conceptual frameworks of the standard setters. For several topics, the use of the appropriate principle could lead to clearer communication and to more precision without the need for the current rules. That is, before asking how rules-based a particular standard should be, we should ask whether the standard is based on the most appropriate principle. I identify six topics on which the accounting standards have detailed technical rules. In each case, I suggest that part of the need for rules is caused by a lack of principle or by the use of an inappropriate principle (i.e., one that does not fit with higher-level principles). The lack of clear and appropriate principles can also lead to optional accounting methods in standards because no one policy is obviously the correct one; this leads to lack of comparability. I do not suggest that the use of appropriate principles would lead inexorably to standards with no optional methods but that, on some topics, optional methods could be eliminated. The six topics are examined one by one. In each case, I attempt to locate the principles being used, to assess the appropriateness of the principles, and then to identify any arbitrary rules or optional methods that result from the absence of appropriate principles. I start with the IASB’s standards (hereafter, IFRSs), with frequent comparison with U.S. GAAP. One reason for examining

IFRSs in particular is that they are required for the financial reporting of listed companies throughout much of the world in 2005 onward,1 and the FASB has announced plans for convergence of its standards with IFRSs.2 The final section of the paper draws conclusions about how accounting might be improved by substituting principles (or better principles) for the existing requirements. PRIOR LITERATURE AND PURPOSE OF THIS PAPER Alexander (1999) investigates the nature of principles and rules in an accounting context. Below, I use the word ìprinciplesî to include Alexanderís type A overall criteria (e.g., fair presentation, the definitions of elements of accounting and, in particular, the primacy of the asset and liability definitions) and his type B conventions (e.g., prudence). Such principles are contained in the standard settersí conceptual frameworks. I contrast this to ìrulesî which are Alexanderís type C rules (e.g., the requirement to measure inventories at the lower of cost and market). My definition of ìrulesî includes Nelsonís (2003, 91) ìspecific criteria, ëbright lineí thresholds, examples, scope restrictions, exceptions, subsequent precedents, implementation guidance, etc.î The use of the terms ìprinciplesî and ìrulesî seems broadly consistent among Alexander (1999), Nelson (2003), Schipper (2003), and me. My purpose is not to investigate why the U.S. system tends toward the writing of rules (whether based on principles or not). Identifying the roles played by the existence since the 1930s of the Securities and Exchange Commission (SEC) as an enforcement agency and the perceived need of auditors to protect themselves from litigation by encouraging the setting of clear and detailed rules is left to Benston (1976), Zeff (1995), and future research. As discussed below, the IASB also frequently writes rules. Thus, my purpose is to evaluate how the failure to use the appropriate principles can lead any standard setter to rely too much on rules. As noted earlier, the imposition of rules has some potential advantages. Those identified by Schipper (2003) and Nelson (2003) include: ï increased comparability; ï increased verifiability for auditors and regulators (and a related reduction in litigation); ï reduced opportunities for earnings management through judgments (but increased opportunities through transaction structuring); and ï improved communication of standard settersí intentions. Nelson (2003) and the American Accounting Associationís Financial Accounting Standards Committee (FASC) (2003) review the literature related to these issues. FASC concludes: Concepts-based standards, if applied properly, better support the FASBís stated mission of ìimproving the usefulness of financial reporting by focusing on the primary characteristics of relevance and reliability.î (AAA FASC 2003, 74) (emphasis added) In addition to balancing the advantages and disadvantages of more detailed rules, the standard setters sometimes face competing principles. An obvious example is the difficulty of trading off relevance and reliability: for instance, estimates of current values or future cash flows might be potentially relevant data, but some such estimates have low reliability. Departure from one principle might be justified by the need to follow another one. Standard setters are also subject to political pressure, especially from the management of large companies (e.g., Hope and Gray 1982; Solomons 1978; Watts and Zimmerman 1978; Nobes 1992; Zeff 1997). Giving way to political pressure might be an explanation for departing from principles. However, a bad standard cannot be re-classified as a good one because issuing it enabled the standard setter to survive.

As noted earlier, my purpose is to identify several accounting topics for which the accounting standard could be improved by being based more closely on a principle from the conceptual frameworks. In some cases, merely removing a rogue ìprincipleî that is not contained in the conceptual frameworks is sufficient. The improvements come in the form of increased clarity, decreased complexity, and decreased motivation for the structuring of transactions. That is, in some cases, increased clarity can be associated with a reduction in rules. This is not to say that principles-based standards are always clearer than rules-based standards. For example, development costs can represent an asset that meets reasonable recognition criteria; IAS No. 38 (para. 57) is based on this argument. In this context, the U.S. requirement (in SFAS No. 2) to expense development costs could be seen as an un-principled rule. However, in this case, the U.S. ìruleî leads to a clearer instruction and to several resulting advantages (see above), although not necessarily to a better balance sheet. Because some accounting topics are not susceptible to solution by use of appropriate principles without rules, standard setters are then forced to choose, for example, between an unclear principle and a clear rule. However, I and most other authors quoted above do not welcome rules for their own sake. They should be kept to the minimum necessary to achieve the various advantages claimed for them, such as clarity. This warrants an examination of each accounting topic to see if a more appropriate principle could achieve the advantages of rules and yet reduce the amount of rules at the same time. As mentioned earlier, the use of appropriate principles can reduce optional accounting treatments, with a consequent increase in comparability. I am not talking here of judgments by preparers, but of overt optional methods in accounting standards. Optional methods are not prevalent in U.S. accounting standards, although some exist.3 However, several options continue to exist in IFRS even after the removal of many in December 2003. The options were needed to achieve a three-quarters majority on the IASC Board, but arguing for the options was easier in the absence of clear principles. Using appropriate principles does not guarantee a reduction in options, but the discussion below finds several instances where a focus on principles can reduce options.

WHAT IS THE MAIN POINT OF THIS ARTICLE? HOW TO SUMMARY THIS?

Case 8

Hemoglobin, the Oxygen Carrier   

Focus concept

            A mutation in the gene for hemoglobin results in an altered protein responsible for the disease sickle cell anemia. An understanding of the biochemistry of the disease may suggest possible treatments.

Prerequisite

Hemoglobin structure and function concepts.

Background

            Normal adult hemoglobin is called Hemoglobin A (Hb A). Ninety-eight percent of adult hemoglobin is Hb A and 2% is Hb A₂. There are other forms of hemoglobin. For example, the developing fetus has a different kind of hemoglobin than most normal adults. Fetal hemoglobin (or Hemoglobin F) consists of two α chains and two γ chains, whereas adult hemoglobin (Hemoglobin A) consists of two α chains and two β chains. Fetal hemoglobin is synthesized beginning at the third month of gestation and continues up through birth. After the neonate is born, hemoglobin F synthesis declines (because synthesis of the γ chain declines) and hemoglobin A is synthesized (because synthesis of β chains begins). By the time the baby is six months old, 98% of its hemoglobin is Hemoglobin A.

            There is also a mutant form of hemoglobin called Hemoglobin S which is found in persons with the disease sickle cell anemia. The disease sickle cell anemia is one of the major health problems facing the African-American community. The World Health Organization estimates that 250,000 babies world- wide are born with sickle cell anemia. Currently there is no cure. A person afflicted with sickle cell anemia has inherited a defective gene from each parent. (Parents who are carriers of the sickle cell gene are heterozygous AS, whereas the person afflicted with sickle cell anemia is SS; non-carriers are designated AA.) The defective gene is the one coding for the β-chain. The amino acid at position 6 on each β chain has been mutated from a glutamate to a valine. Normal α chains have a decreased affinity for the mutated β chains; thus assembly of the HbS tetramer is more difficult. Red blood cells containing HbS form a sickle shape because the Hb S molecules polymerize. Hb S molecules are more likely to polymerize when in the deoxygenated T form than in the oxygenated R form. The polymerized Hb deforms the normal discoid shape of the red blood cells, producing a sickle-shaped cell. The sickle shaped red blood cells become trapped in capillaries and organs, depriving the victim of adequate oxygen supply and causing chronic pain and organ damage.

            In this case we will consider our patient, a 10-year-old black male child named Michael B., who was admitted to the hospital because he was experiencing severe chest pain. He had been hospitalized on several previous occasions for vaso-occlusive episodes that caused him to experience severe pain that could not be managed with non-prescription drugs such as ibuprofen. He was slightly jaundiced, short of breath and easily tired, and feverish. A chest x-ray was taken and was abnormal. An arterial blood sample showed a p_O2 value of 6 kPa (normal is 10-13 kPa).

Questions

You suspect that Michael has sickle cell anemia and you have ordered an isoelectric focusing analysis of the child‟s lysed red blood cells. (Lysing the red blood cells releases the hemoglobin.) Draw a diagram of the predicted results. Why will this test allow you to diagnose this child‟s disease?

Why do you think that Hb S molecules would be likely to clump together whereas Hb A molecules do not?

In the emergency room, oxygen (100%) was administered to the patient. (Inspired air normally is about 20% oxygen.) Why was this an effective treatment?

You recall reading in the medical literature about a dramatic new drug treatment for sickle cell anemia, and you‟d like to try it on this patient. The drug is hydroxyurea, and is thought to function by stimulating the afflicted person‟s synthesis of fetal hemoglobin. Exactly how hydroxyurea stimulated fetal hemoglobin synthesis is unclear, but it is believed that hydroxyurea is metabolized to NO, which binds to a soluble guanylate cyclase enzyme which then catalyzes the synthesis of a second messenger, cyclic GMP (cGMP). The cGMP interacts with transcription factors in a manner that is not completely understood to induce the transcription (and then translation) of the fetal hemoglobin gene.

In a clinical study, patients who took hydroxyurea showed a 50% reduction in frequency of hospital admissions for severe pain, and there was also a decrease in the frequency of fever and abnormal chest x-rays. Why would increasing the synthesis of fetal hemoglobin result in alleviating the symptoms of sickle cell anemia?

Medical practioners who used hydroxyurea as a treatment for sickle cell anemia noted that their patients seemed to benefit from the administration of the drug long before the synthesis of fetal hemoglobin had time to take effect. It has recently been determined that hydroxyurea can react directly with the iron ion of oxy- and deoxyHb to form iron nitrosyl hemoglobin (HbNO). Why would this be of benefit to the sickle-cell anemic patient?

And finally, hydroxyurea has been shown to produce NO directly, in less than an hour after hydroxyurea administration. It‟s also possible that HbNO could produce NO, either directly or indirectly. NO is an important second messenger which, even in nanomolar amounts, stimulates vasodilation. How could NO production help the sickle-cell anemic patient?

A year ago, at a conference, one of your colleagues told you that she had “cured” a patient of sickle cell anemia by performing a bone marrow transplant. Why would this procedure “cure” sickle cell anemia?

The patient‟s parents tell you that they are planning on having another child and that they are confident that subsequent children will not have sickle cell anemia, since they already have a child with the disease. What will you tell them?

References

Glew, R. H., and Ninomiya, Y. (1997) Clinical Studies in Medical Biochemistry, Oxford University Press, pp. 78-90.

Glover, R. E., Ivy, E. D., Orringer, E. P., Maeda, H., and Mason, R. (1999) Molecular Pharmacology 55, pp. 1006-1010.

Huang, J., Hadimani, S. B., Rupon, J. W., Ballas, S. K., Kim-Shapiro, D. B., and S. Bruce King (2002) Biochemistry 41, pp. 2466-2474.

S. Bruce King (2003) J.Clin. Invest., 111, pp. 171-172.

Answer the following Questions using the Measles at Disneyland Article listed below:

1. Apply the epidemiological triangle. Describe the agent, person, and environment.

2. How would you classify the Disease?

3. Identify a prevention strategy for each of the 3 levels of prevention. (Prinmary Prevention, Secondary Prevention, Tertiary Prevention)

Article: Measles at Disneyland, a Problem for All Ages

Measles is once again capturing headlines in the United States. Even though only a small portion of the U.S. population is susceptible, international travel, vaccine refusal or delay, and rare vaccine failures combined with high social contacts allow the highly infectious measles virus to infect susceptible individuals of all ages (1). The story of an unvaccinated child or adolescent contracting measles while traveling abroad and transmitting the virus to others upon return to the United States has been repeated many times in recent years. The 2014–2015 Disneyland-associated outbreak has captured public attention because infants too young to receive the vaccine and children with true medical contraindications to vaccination became infected (2). In addition, Disneyland employees contracted measles and possibly contributed to disease transmission. In 2014, there were 23 measles outbreaks and more than 644 cases of measles (2). More outbreaks owing to vaccine refusal will undoubtedly occur because of sufficient numbers of susceptible individuals in many areas.

Several factors have contributed to parents' refusal to vaccinate their children, and rates of refusal have increased in some states in recent years (3). In addition, although great progress has been made in controlling measles globally, it has recently rebounded in many countries (1). In Europe, where most countries do not require measles or other immunizations for children to attend schools, more than 10 000 cases of measles have been reported each year for several years. The flawed and fraudulent study published in 1998 claiming that the measles-mumps-rubella (MMR) vaccine caused autism has contributed to the hesitancy to vaccinate and the resurgence of measles (1, 3, 4) over the 12 years before the study was retracted. However, even after the study was proven to be based on fabricated data, and numerous reviews and reports in the responsible press discredited the study, fears linger. It is hoped that the recent encouragement by Autism Speaks for parents to vaccinate their children should help increase rates (5).

The relative absence of measles in most areas of the United States for many years has led to an under-appreciation of measles-related complications and mortality that occurs at all ages and in all countries, including the United States. A review of more than 67 000 reported cases of measles in the United States from 1987 to 2000 found that complications include otitis media, pneumonia, diarrhea, and encephalitis in children younger than 5 years and that hospitalization for measles complications was required for approximately 25% of infected children (6). The complication rates are lowest among children and adolescents aged 5 to 19 years, but the rate of complications increases after adolescence, and hospitalization and mortality rates are highest in persons 30 years of age or older (6). In fact, case-fatality rates in adults 30 years of age or older are higher than those in children younger than 5 years.

Much can be done to prevent these outbreaks. Children younger than 12 months of age (the recommended age for the first dose of MMR) and those with medical contraindications depend on high levels of immunity in the rest of the population to provide “community protection,” sometimes referred to as “herd immunity.” These individuals are not immune to measles and will remain susceptible during outbreaks. Parents should be able to take all children to Disneyland and other public places without the fear of measles exposure. Some have proposed removing religious, philosophical, and/or personal belief exemptions to school laws, but enacting these changes could inflame public opinion against immunizations (3, 7). How can adult primary care clinicians assist their pediatric colleagues in boosting community protection? They should routinely review immunization records as they see new patients who are transitioning from pediatric care. The current Advisory Committee on Immunization Practices recommendations advise immunization for potentially susceptible individuals to help prevent future outbreaks (8). Primary care practitioners can also be sure to confirm immunization status of their patients who are health care providers or who plan to travel to other countries (including Europe) where measles is a problem (8). Primary care clinicians should also consider confirmation of immunization status of adult patients working in settings with a high likelihood of exposure to large numbers of children or international travelers, such as schoolteachers or theme park staff. Most adults do not know their detailed vaccination history or have access to their pediatric medical records. Verbal reassurance that “I had all my shots” is insufficient. The simplest thing to do if vaccine status is uncertain is to provide a dose of MMR to those without documentation of 2 doses of measles vaccine after 12 months of age (8). Although serologic testing is an option, it requires multiple visits and possible delays. Primary care physicians also need to be familiar with the clinical signs of measles and promptly report suspect cases to local health authorities to try to limit outbreaks when they do occur.

Measles can be eradicated. However, this will take time; ramped-up efforts to ensure that eligible U.S. children are vaccinated; and greater international collaboration to improve prevention of measles in all countries, including highly industrialized countries with ongoing measles problems (1). Maintaining public trust in immunization and our immunization safety system is essential in helping parents to understand the potential adverse consequences of failure to vaccinate and that processes are in place to ensure that their children receive the safest vaccines possible. Coordinated input from all stakeholders with oversight as recommended in 2011 by the National Vaccine Advisory Committee (9) would enhance public confidence in our immunization programs. Following the framework recommended by the Institute of Medicine (10), constant surveillance and additional studies of vaccine safety to address public concerns should be a priority. Adequate funding is necessary to take advantage of the expanded use of electronic health records to conduct epidemiologic studies that identify or rule out even small postvaccination risks. Also, funding of studies to take advantage of advances in immunology and genomics can allow us to better understand the biological mechanisms for adverse events caused by vaccines and for diseases of concern. Such studies would help counter the common misperception that every illness that occurs after vaccination was caused by the vaccine.

Chapter 1 of our text casts the Spotlight on Nigeria, with a population of 186 million and counting. Africa’s most populous country faces the curious challenge the comparative literature calls the “resource curse--” one that other resource-rich countries such as Iran, Venezuela, the Democratic Republic of the Congo, and South Sudan also grapple. The “curse” points to a situation in which an abundance of oil resources, instead of delivering higher living standards, a better quality of life, and economic prosperity for the population, instead perpetuates underdevelopment.

The paradox is particular pronounced for Nigeria, one of the world’s biggest oil-producers. Despite earning hundreds of billions from its petroleum exports, accounting for a whopping 90 percent of gross domestic product (GDP), Nigeria scores only 0.532 on the UNDP’s 2017 HDI index, up a mere 0.061 from 2012, or 157 out of 189 countries. (UNDP. International Human Development Indicators. Its poor showing on critical QLI indicators--health, life expectancy, education, poverty, gender equality, sustainability, and so on--is illustrative of the classic challenge to many resource-rich countries in the Global South: abundant natural resources that, instead of bringing economic prosperity has done the opposite. It begs the question, would Nigeria be better off without oil?

It may strike us as odd that a country so richly-endowed with natural resources has not been able to show more for it. Instead, what we have had are several military coups, rampant corruption, political fragmentation, poor living standards, and fitful democratic progress. On the corruption side of the ledger, Nigeria ranks 148/180 on Transparency International’s 2017 Corruption Index, scoring a mere 27 out of 100, slightly above Afghanistan, Burundi, Haiti, North Korea, Somalia, and Tajikistan. Corruption has enabled the political elite to “buy off” mass publics and, until recently, underwrite repressive rule. “Black gold” has served to distort normal economic development in Nigeria by robbing other sectors of needed resources. (Similar situations obtain in other oil-producing economies such as Algeria (now experiencing great political upheaval) and Iran in the Middle East/North Africa and Mexico and Venezuela in our own Hemisphere.)

Nigeria’s (post-independence) economic plan sought to encourage domestic growth through tariffs and subsidies, a strategy that should have produced good results, given its high oil revenues. It failed, being driven more by political expediency than by economic logic. So, for example, a US$ 8 billion investment in steel production failed to get off the ground. (Nmehelle, Vincent O. “Sharia Law in the Northern States of Nigeria: To implement, or not to implement, the Constitutionality is the Question,” Human Rights Quarterly 26, no. 3 (2004), pp. 730-59.).

Oil price declines beginning in the 1980s, amidst economic uncertainty and changing energy habits in the industrialized North and a chronic foreign-debt burden, forced Nigeria’s leaders to reverse course on its economic development strategy. This resulted in huge job losses, run-away inflation, and much public discontent. To win support, the military government of Ibrahim Babangida (1985-93) diverted the country’s oil wealth to coopt opponents and the civil society, even while it kept up the pressure on its critics. Political support was purchased through an elaborate system of patrimony using petro dollars.

Another military coup in 1993 brought Sani Abacha to power. Corruption (the misuse of political office for personal or political gain) became endemic (Johnston, Michael. Syndromes of Corruption: Wealth, Power, and Democracy. Cambridge & New York: Cambridge University Press (2005)--as was narco- and human trafficking, money laundering, and so-called 419 scams--an internet swindle involving unknown Nigerian civil servants.

The fourth republic under the popularly-elected government of Olusegun Obasanjo (1999-2007) faced the daunting task of reining in the economy while breaking with the past. The approach produced only limited results. Yar’Adua (2007-2010) and his Democratic Party (PDP) successors (2010-15) launched what became known as the National Economic Empowerment and Development Strategy (NEEDS). NEEDS was an ambitious plan to stimulate domestic enterprise through foreign direct investment (FDI). It was also meant to bring more transparency in government spending, foster the rule of law, reduce corruption, improve transportation and telecom, and deliver the people’s health. The International Monetary Fund (IMF) report on Nigeria sounds a cautious note of optimism, i.e. if the economic reforms and diversification plans, and the efforts to control inflation (the money supply), stabilise the country’s finances, and “move beyond oil,” remain on track.

In theory, then all is not lost for Nigeria to overcome its resource curse. For all that, it continues to depend heavily on one source of income--petroleum; and not much has changed in terms of improvements in living standards for the majority of Nigerians. Indeed, inequality has reached alarming levels. To be fair, Nigeria’s civilian leaders have boldly gone where none of its military rulers have gone, starting the “rainy-day” fund and tackling corruption, especially in the all-important oil sector.

Still, huge challenges remain, reflecting the ambiguous role of petroleum in the country’s life. So, although there are hopeful signs, Nigeria’s prospects, like that of Brazil and others, remain uncertain. The rise of the Boko Haram terrorist group and the failure of the current President Muhammadu Buhari to bring it to book has not helped. (For background on the group, founded in 2002, see the BBC here.) Buhari has come in for “widespread criticism over his government’s inability to defeat the renewed …insurgency in the northeast.” The New York Times, 9 April 2018 (here). This explains in part why Nigeria scores only modestly on civil liberties (freedom of expression, association, the rule of law, personal and individual rights) on the Freedom House Index; and also on the EIU Index.

Here are some pathways into this first discussion: What do you make of Nigeria’s resource-curse challenge? Can the country get out from under this curse and how? Why does Nigeria seem to hold so much promise, yet continually fails to deliver? Comparatively speaking, how do we account for the fact that Canada, also an energy-rich country, has not fallen prey to this curse?