Summary- An examination of the financial service

Macroeconomics R. GLENN HUBBARD COLUMBIA UNIVERSITY ANTHONY PATRICK O’BRIEN LEHIGH UNIVERSITY MATTHEW RAFFERTY QUINNIPIAC UNIVERSITY Boston Columbus Indianapolis New York San Francisco Upper Saddle RiverAmsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto Delhi Mexico City So Paulo Sydney Hong Kong Seoul Singapore Taipei TokyoAbout the AuthorsGlenn Hubbard Professor Researcher and Policymaker R. Glenn Hubbard is the dean and Russell L. Carson Professor of Finance and Economics in the Graduate School of Business at Columbia University and professor of economics in Columbia’s Faculty of Arts and Sciences. He is also a research associate of the National Bureau of Economic Research and a director of Automatic Data Processing Black Rock Closed- End Funds KKR Financial Corporation and MetLife. Professor Hubbard received his Ph.D. in economics from Harvard University in 1983. From 2001 to 2003 he served as chairman of the White House Council of Economic Advisers and chairman of the OECD Economy Policy Commit- tee and from 1991 to 1993 he was deputy assistant secretary of the U.S. Treasury Department. He currently serves as co-chair of the nonpar-tisan Committee on Capital Markets Regulation and the Corporate Boards Study Group. ProfessorHubbard is the author of more than 100 articles in leading journals including American EconomicReview Brookings Papers on Economic Activity Journal of Finance Journal of Financial EconomicsJournal of Money Credit and Banking Journal of Political Economy Journal of Public EconomicsQuarterly Journal of Economics RAND Journal of Economics and Review of Economics and Statistics.Tony O’Brien Award-Winning Professor and Researcher Anthony Patrick O’Brien is a professor of economics at Lehigh University. He received a Ph.D. from the University of California Berkeley in 1987. He has taught principles of economics money and banking and interme- diate macroeconomics for more than 20 years in both large sections and small honors classes. He received the Lehigh University Award for Distin- guished Teaching. He was formerly the director of the Diamond Center for Economic Education and was named a Dana Foundation Faculty Fel- low and Lehigh Class of 1961 Professor of Economics. He has been a visit- ing professor at the University of California Santa Barbara and Carnegie Mellon University. Professor O’Brien’s research has dealt with such issues as the evolution of the U.S. automobile industry sources of U.S. economiccompetitiveness the development of U.S. trade policy the causes of the Great Depression and thecauses of black–white income differences. His research has been published in leading journals in-cluding American Economic Review Quarterly Journal of Economics Journal of Money Credit andBanking Industrial Relations Journal of Economic History Explorations in Economic History andJournal of PolicyHistory.Matthew Rafferty Professor and Researcher Matthew Christopher Rafferty is a professor of economics and department chairperson at Quinnipiac University. He has also been a visiting professor at Union College. He received a Ph.D. from the University of California Davis in 1997 and has taught intermediate macroeconomics for 15 years in both large and small sections. Professor Rafferty’s research has f ocused on university and firm-financed research and development activities. In particular he is interested in understanding how corporate governance and equity compensation influence firm research and development. His research has been published in leading journals including the Journal of Financial and Quantitative Analysis Journal of Corporate Finance Research Policy and the Southern Economic Journal. He has worked as a consultantfor theConnecticut Petroleum Council on issues before the Connecticut state legislature. He has alsowritten op-ed pieces that have appeared in several newspapers including the New York Times. iii Brief Contents Part 1: Introduction Chapter 1 The Long and Short of Macroeconomics 1 Chapter 2 Measuring the Macroeconomy 23 Chapter 3 The Financial System 59 Part 2: Macroeconomics in the Long Run: Economic Growth Chapter 4 Determining Aggregate Production 105 Chapter 5 Long-Run Economic Growth 143 Chapter 6 Money and Inflation 188 Chapter 7 The Labor Market 231 Part 3: Macroeconomics in the Short Run: Theory and Policy Chapter 8 Business Cycles 271 Chapter 9 IS–MP: A Short-Run Macroeconomic Model 302 Chapter 10 Monetary Policy in the Short Run 363 Chapter 11 Fiscal Policy in the Short Run 407 Chapter 12 Aggregate Demand Aggregate Supply and Monetary Policy 448 Part 4: Extensions Chapter 13 Fiscal Policy and the Government Budget in the Long Run 486 Chapter 14 Consumption and Investment 521 Chapter 15 The Balance of Payments Exchange Rates and Macroeconomic Policy 559 Glossary G-1 Index I-1ivContentsChapter 1 The Long and Short of Macroeconomics 1WHEN YOU ENTER THE JOB MARKET CAN MATTER A LOT ........................................................ 11.1 What Macroeconomics Is About........................................................................... 2 Macroeconomics in the Short Run and in the Long Run .................................................... 2 Long-Run Growth in the United States ............................................................................. 3 Some Countries Have Not Experienced Significant Long-Run Growth ............................... 4 Aging Populations Pose a Challenge to Governments Around the World .......................... 5 Unemployment in the United States ................................................................................. 6 How Unemployment Rates Differ Across Developed Countries ......................................... 7 Inflation Rates Fluctuate Over Time and Across Countries................................................. 7 Econo mic Policy Can Help Stabilize the Economy .. (8)International Factors Have Become Increasingly Important in Explaining Macroeconomic Events................................................................................. 91.2 How Economists Think About Macroeconomics ............................................. 11 What Is the Best Way to Analyze Macroeconomic Issues .............................................. 11 Macroeconomic Models.................................................................................................. 12Solved Problem 1.2: Do Rising Imports Lead to a Permanent Reductionin U.S. Employment. (12)Assumptions Endogenous Variables and Exogenous Variables in EconomicModels ........................................................................................................ 13 Forming and Testing Hypotheses in Economic Models .................................................... 14Making the Connection: What Do People Know About Macroeconomicsand How Do They KnowIt .............................................................................................. 151.3 Key Issues and Questions of Macroeconomics ............................................... 16An Inside Look: Will Consumer Spending Nudge Employers to Hire................................ 18Chapter Summary and Problems ............................................................................. 20 Key Terms and Concepts Review Questions Problems and Applications Data Exercise Theseend-of-chapter resource materials repeat in all chapters.Chapter 2 Measuring the Macroeconomy 23HOW DO WE KNOW WHEN WE ARE IN ARECESSION ........................................................... 23Key Issue andQuestion .................................................................................................... 232.1 GDP: Measuring Total Production and Total Income ..................................... 25 How theGovernment Calculates GDP (25)Production and Income (26)The Circular Flow of Income (27)An Example of Measuring GDP (29)National Income Identities and the Components of GDP (29)vvi CONTENTS Making the Connection: Will Public Employee Pensions Wreck State and Local Government Budgets.................................................................... 31 The Relationship Between GDP and GNP........................................................................ 33 2.2 Real GDP Nominal GDP and the GDP Deflator.............................................. 33 Solved Problem 2.2a: Calculating Real GDP . (34)Price Indexes and the GDP Deflator (35)Solved Problem 2.2b: Calculating the Inflation Rate ..........................................................36 The Chain-Weighted Measure of Real GDP ....................................................................37 Making the Connection: Trying to Hit a Moving Target: Forecasting with “Real-Time Data” .................................................................................. 37 Comparing GDP Across Countries................................................................................... 38 Making the Connection: The Incredible Shrinking Chinese Economy ................................ 39 GDP and National Income .............................................................................................. 40 2.3 Inflation Rates and Interest Rates ....................................................................... 41 The Consumer Price Index .............................................................................................. 42 Making the Connection: Does Indexing Preserve the Purchasing Power of Social Security Payments ................................................................ 43 How Accurate Is theCPI ............................................................................................... 44 The Way the Federal Reserve Measures Inflation ............................................................ 44 InterestRates .................................................................................................................. 45 2.4 Measuring Employment and Unemployment .. (47)Answering the Key Question ............................................................................................ 49 An Inside Look: Weak Construction Market Persists.......................................................... 50 Chapter 3 The Financial System 59 THE WONDERFUL WORLD OFCREDIT ................................................................................... 59 Key Issue and Question .................................................................................................... 59 3.1 Overview of the Financial System ...................................................................... 60 Financial Markets and Financial Intermediaries ................................................................ 61 Making the Connection: Is General Motors Making Cars or Making Loans .................... 62 Making the Connection: Investing in the Worldwide Stock Market . (64)Banking and Securitization (67)The Mortgage Market and the Subprime Lending Disaster (67)Asymmetric Information and Principal–Agent Problems in Financial Markets...................68 3.2 The Role of the Central Bank in the Financial System (69)Central Banks as Lenders of Last Resort ..........................................................................69 Bank Runs Contagion and Asset Deflation ....................................................................70 Making the Connection: Panics Then and Now: The Collapse of the Bank of United States in 1930 and the Collapse of Lehman Brothers in2008 (71)3.3 Determining Interest Rates: The Market for Loanable Funds and the Market forMoney .......................................................................................... 76 Saving and Supply in the Loanable Funds Market ........................................................... 76 Investment and the Demand for Loanable Funds ............................................................ 77 Explaining Movements in Saving Investment and the Real Interest Rate (78)CONTENTS .。

English S ummary PhrasesPart I学术生活 academic l ife民族认同 ethnic i dentity种族歧视 racial p rejudice伦理道德观念 ethical v alues政治上的成熟 political m aturity认同危机 identity c risis基因工程 genetic e ngineering偶然事件 chance e vents青少年阶段 adolescence s tage每日工作日程 daily a genda功能独立 functional i ndependence异性 the o pposite s ex生活方式 a w ay o f l ife获得知识 to a cquire k nowledge给这个词下定义 to d efine t he w ord对这种对待感到反感 to r esent t he t reatment确立自己的身份 to e stablish t heir i dentity使学生感到沮丧 to f rustrate t he s tudents宣战 to d eclare w ar拖着脚步 to d rag o ne’s f eet对结果进行评估 to e valuate t he r esult对知识进行加工 to p rocess k nowledge缩小差距 to n arrow t he g ap扩大业务 to e xpand b usiness装配汽车 to a ssemble c ars提出事实 to p resent f actsPart I I决定今天到此为止 to c all i t a d ay获得利益 to m ake p rofit改进性能 to i mprove p erformance停学 to q uit s chool做一笔交易 to m ake a d eal变本加厉重新开始 to s tart a gain w ith a v engeance 注册登记成立一家公司 to i ncorporate a c ompany组装一辆汽车 to a ssemble a c arto g ross(top/net) 10 m illion d ollars营业额达(总数超/纯利达)一千万美元开发产品 to d evelop p roducts营销产品 to m arket p roducts从中得到教训 to d raw a l esson f rom i t实现梦想 to r ealize a d ream捐钱 to d onate m oney游手好闲，不务正业 to f ool a round经济前景 business(economic) p rospects竞争优势 a c ompetitive e dge营业执照 business l icense库存和管理费 inventory a nd o verheads按客户需要配置的电脑 custom-­‐made(personalized) c omputers 库存过多 surplus s tock/excess i nventory销售定额 a s ales q uota增值 added v alue零售价格 a r etail p rice千载难逢的机会 the o pportunity o f a l ifetime春假 spring r ecess财务和管理 finance a nd a dministration直销 direct m arketing会计基础 accounting b asics可以退货的保证 a m oney-­‐back g uarantee现场服务 on-­‐site s ervice市中心 a c ivic c enter犹太人集中的社区 the J ewish c ommunity终端用户 end u sersPart I II继续去写她的东西 to r esume h er w riting流露他的真情 to b etray h is t rue f eelings引起巨大愤怒 to a rouse g reat a nger出自己的洋相 to m ake a f ool o f o neself通知相关的所有人 to i nform e veryone c oncerned问讯 to m ake i nquires遭受巨大痛苦 to s uffer a t errible p ain扔一块石头 to p itch a s tone（因为重要）专门去做某事 to m ake a p oint o f d oing s omething侵犯我的隐私 t o i nfringe o n m y p rivacy放弃研究 to a bandon t he r esearch上一个新项目 to l aunch a n ew p roject重新做人 to s tart o ne’s l ife a fresh采纳一种新方法 to a dopt a n ew m ethod挑起激烈的反应 to p rovoke a v iolent r eaction找回自己丢失的车 to r ecover o ne’s m issing c ar涉及到和各种人打交道 to i nvolve d ealing w ith a ll k inds o f p eoplePart I V将人民币换成外币 t o c onvert C NY i nto f oreign c urrency寻找真理 to s eek t he t ruth抛掉旧的传统 to d iscard t he o ld t raditions讽刺人的虚荣 to s atirize h uman v anity在那岛上住人 to i nhabit t hat i sland钦佩他们的勇气 to a dmire t heir c ourage玩忽职守 to n eglect o ne’s d uty逃避后果 to e scape t he c onsequences挡路 to b lock o ne’s w ay毁掉名誉 to r uin o ne’s r eputation年久失修的防御工事 neglected f ortificationsa s quatter’s h ut擅自占用土地的人搭建的临时简陋房子容易变质的东西 perishable g oods社会习俗 conventions o f s ociety摇摇晃晃、头重脚轻的酒鬼 tottering d runks当前的风云人物 the m an o f t he h our英雄人物 heroic f igures一种带有使命感的神态 an a ir o f d estiny看人时如火一般的眼光 a w ar s care雨点般的石头 a s hower o f s tones一小撮捣乱分子 a h andful o f t rouble-­‐makersPart V塑造年轻人的心灵 to m old y oungsters’ t hinking涂上黄油 to s pread b utter污染环境 to c ontaminate t he e nvironment缓和口气 to m odify t he t one造成未曾料到的伤害 to w ork u nknown h arm创造奇迹 to w ork m iracles获得权力 to a cquire p ower抛弃朋友 to d esert o ne’s f riends放弃这一城市 to d esert t he c ity解决这一争端 to s ettle t he d ispute解决这一问题＊ to s ettle t he m atter赏心悦目 to d elight t he e ye侵入那个国家 to i nvade t hat c ountry侵犯某人隐私 to i nvade o ne’s p rivacy挖一口井 to s ink a w ell严酷的现实 harsh r eality空气污染 air c ontamination致命武器 lethal w eapons人工合成材料 synthetic m aterials事先的调查 advance i nvestigation生死攸关的斗争 a l ife-­‐and-­‐death s truggle外来物种 introduced s pecies自然保护区 natural r eserves农业的精耕细作 intensification o f a gricultureParagraphsPart IADuring t his t ime, s tudents a re g oing t hrough a n i dentity c risis a nd a re e ndeavoring t o find o ut w ho t hey a re a nd w hat t heir s trengths a nd w eaknesses a re. T hey h ave, o f course, p lenty o f b oth. I t i s i mportant t o k now h ow p eople p erceive t hemselves a s well a s h ow o thers p erceive t hem. A ccording t o p iers a nd l andau, i n a n a rticle discussing t he t heories o f E rik H. E rickson i n i nternational e ncyclopedia o f s ocial sciences (1979), i dentity i s d etermined b y g enetic e ndowment (what i s i nherited from p arents), s haped b y e nvironment, a nd i nfluenced b y c hance e vents. P eople a re influenced b y t heir e nvironment a nd, i n t urn, i nfluence t heir e nvironment. H ow people s ee t hemselves i n b oth r oles i s u nquestionably a p art o f t heir i dentity.BProbably o ne o f t he m ost s tressful m atters f or y oung c ollege s tudents i s e stablishing their f uture s exual i dentity, w hich i ncludes r elating t o t he o pposite s ex a nd projecting t heir f uture r oles a s m en o r w omen. E ach m ust d efine h er o f h is s exual identity i n a f eminine o r m asculine r ole. T hese a re e xciting t imes y e f rustrating t imes. Probably n othing c an m ake s tudents f eel l ower o r h igher e motionally t han t he w ay they a re r elating t o w homever t hey a re h aving a r omantic r elation w ith. F or e xample, when I w as w orking w ith a y oung c ollege s tudent, h e b ounced i nto m y o ffice o nce with a s mile o n h is f ace a nd e xcitement i n h is v oice. T he y oung m an d eclared, “I’ve just h ad t he b est d ay o f m y l ife!” h e w ent o n t o e xplain h ow h e h ad m et a n extraordinary y oung w oman a nd h ow t his r elationship w as a ll h e h ad d reamed a romantic r elationship s hould b e. T hat s ame y oung m an c ame i nto m y o ffice l ess t han a w eek l ater, d ragging h is f eet w ith a d ismayed, d ejected l ook o n h is f ace. H e s at down i n t he s ame c hair, s ighed d eeply, a nd d eclared,” I’ve j ust h ad t he w orst d ay o f my l ife!” h e a nd t he y oung w oman h ad j ust h ad a n a rgument, a nd t heir r elationship was n o l onger g oing w ell. T hus, t he w ay s tudents a re r elating t o t hose o f t he opposite s ex h as a d efinite i nfluence o n t heir e motions.Part I IADell k new t hat I BM r equired i ts d ealers t o t ake a m onthly q uota o f P Cs, i n m ost c ases more t han t hey c ould s ell. H e a lso k new t hat h olding e xcess i nventory w as c ostly. S o he b ought d ealers' s urplus s tock a t c ost. B ack i n h is d orm r oom, h e a dded f eaturesto i mprove p erformance. T he s ouped-­‐up m odels f ound e ager b uyers. S eeing t he hungry m arket, D ell p laced l ocal a dvertisements o ffering h is c ustomized c omputers at 15 p ercent o ff r etail p rice. S oon h e w as s elling t o b usinesses, d octors' o ffices a nd law f irms. T he t runk o f h is c ar w as h is s tore; h is r oom t ook o n t he a ppearance o f a small f actory.BThe q uarters h e s hared w ith t wo r oommates l ooked l ike a c ombat z one-­‐ b oxes p iledhigh, c omputer b oards a nd t ools s cattered a round. O ne d ay h is r oommates h eaped all h is e quipment i nto a p ile, p reventing D ell f rom e ntering h is r oom. I t w as t ime t o come t o g rips w ith t he m agnitude o f w hat h e h ad c reated. T he b usiness w as n ow grossing m ore t han $ 50 000 a m onth.Part I IIAMr. C rowther, f or h is p art, h ad a lso s uffered s ome d istraction. T hought h e w as pretending t o r ead, h e w as a ctually u nable t o d o s o. F or a ll h is a ppearance o f indifference, t he s ight o f a w ell-­‐to-­‐do g entleman p itching a s uitcase f rom t he window o f a m oving t rain h ad s urprised h im v ery m uch. B ut h e h ad n ot b etrayed h is surprise. T he f ellow w as o bviously c ounting o n h im f or a v iolent r eaction, a nd s o M r. Crowther m ade a p oint o f n ot r eacting. W hether t he t hing w as a p ractical j oke o r n ot, Mr. C rowther c onsidered i t a n a nnoying i nfringement o f h is p rivacy. I t w as a s i f t he fellow h ad b urst a p aper b ag i n t he h ope o f m aking h im j ump. W ell, h e w asn't g oing to j ump, h e w asn't g oing t o g ive t hat f ellow t he s atisfaction. I f t he f ellow i magined that t o t hrow a s uitcase o ut o f t he w indow g ave h im s ome s ort o f i mportance, w ell, he w as m istaken.BMr. H arraby-­‐Ribston t ook t he d isclosure r emarkably w ell. H e d id, i t's t rue, f linch a nd turn a l ittle p ale, b ut i n a f ew m oments h e h ad r ecovered h imself." T hank y ou, s ir," he s aid; a nd l et m e s ay h ow m uch I a ppreciate y our o penness. I n f act, y ou t empt m e to b e e qually f rank w ith y ou. L et m e c onfess, t hen, t hat a s a m atter o f f act I h aven't left m y w ife, f or t he s imple r eason t hat I'm a b achelor. I g row v egetables o n r ather a large s cale a nd o nce a w eek b usiness t akes m e t o L ondon. A s f or t he m atter o f t he suitcase , I h ave s ome f riends w hose h ouse w e p assed a f ew m iles b ack a nd e very week I f ill a s uitcase w ith v egetables, b ring i t w ith m e, a nd t hrow i t o ut o f t he carriage-­‐window a s t he t rain p asses t heir h ouse. I t r olls d own t he e mbankment a nd lands u p a gainst t heir r ailings. I t's a p rimitive m ethod, I k now, b ut i t s aves p ostage and y ou c an h ave n o i dea h ow m uch e ntertaining c onversation i t p rovokes w ith m y fellow-­‐passengers. Y ou, i f I m ay s ay s o, a re n o e xception."Part I VAOnly t wenty, A lexander w as f ar o lder a nd w iser t han h is y ears. L ike a ll M acedonians he l oved d rinking, b ut h e c ould u sually h andle i t; a nd t oward w omen h e w as n obly restrained a nd c hivalrous. L ike a ll M acedonians h e l oved f ighting; h e w as a magnificent c ommander, b ut h e w as n ot m erely a m ilitary a utomaton. H e c ould think. A t t hirteen h e h ad b ecome a p upil o f t he g reatest m ind i n G reece, A ristotle who g ave h im t he b est o f G reek c ulture. H e t aught A lexander p oetry: t he y oung prince s lept w ith t he I liad u nder h is p illow a nd l onged t o e mulate A chilles, w ho brought t he m ighty p ower o f A sia t o r uin. H e t aught h im p hilosophy, i n p articular t he shapes a nd u ses o f p olitical p ower a nd h e t aught h im t he p rinciples o f s cientific research: d uring h is i nvasion o f t he P ersian d omains A lexander t ook w ith h im a l argecorps o f s cientists, a nd s hipped h undreds o f z oological s pecimens b ack t o G reece f or study. I ndeed, i t w as f rom A ristotle t hat A lexander l earned t o s eek o ut e verything strange w hich m ight b e i nstructive.BNow, A lexander w as i n C orinth t o t ake c ommand o f t he L eague o f G reek S tates, which, h is f ather P hilip h ad c reated a s a d isguise f or t he N ew M acedonian O rder. H e was w elcomed a nd h onored a nd f lattered. H e w as t he m an o f t he h our, o f t he century: h e w as u nanimously a ppointed c ommander-­‐in-­‐chief o f a n ew e xpedition against o ld, r ich, c orrupt A sia. N early e veryone c rowded t o C orinth i n o rder t o congratulate h im, t o s eek e mployment w ith h im, e ven s imply t o s ee h im. O nly Diogenes, a lthough h e l ived i n C orinth, d id n ot v isit t he n ew m onarch. W ith t hat generosity w hich A ristotle h ad t aught h im , A lexander d etermined t o c all u pon Diogenes.Part VAAnother f actor i n t he m odern i nsect p roblem i s t he s preading o f t housands o f different k inds o f o rganisms f rom t heir n ative h omes. S ome h undred m illion y ears ago, f looding s eas c ut m any l and b ridges b etween c ontinents a nd l iving t hings f ound themselves c onfined i n w hat a n e cologist c alls “colossal s eparate n ature r eserves”. There, i solated f rom o thers o f t heir k ind, t hey d eveloped m any n ew s pecies. W hen some o f t he l and m asses w ere j oined a gain, a bout 15 m illion y ears a go, t hese species b egan t o m ove o ut i nto n ew t erritories-­‐-­‐-­‐a m ovement t hat i s n ot o nly s till i n progress b ut i s n ow r eceiving c onsiderable a ssistance f rom m an.BIt i s n ot m y c ontention t hat c hemical i nsecticides m ust n ever b e u sed. I d o c ontend that w e h ave p ut p oisonous a nd b iologically p otent c hemicals i ndiscriminately i nto the h ands o f p ersons l argely o r w holly i gnorant o f t heir p otentials f or h arm. W e h ave subjected e normous n umbers o f p eople t o c ontact w ith t hese p oisons, w ithout t heir consent a nd o ften w ithout t heir k nowledge. I c ontend, f urthermore, t hat w e h ave allowed t hese c hemicals t o b e u sed w ith l ittle o r n o a dvance i nvestigation o f t heir effect o n s oil, w ater, w ildlife, a nd m an h imself. F uture g enerations a re u nlikely t o forgive o ur l ack o f c oncern f or t he i ntegrity o f t he n atural w orld t hat s upports a ll l ife.TranslatePart I1) 她打算申请那个学术工作。

CHAPTER 1AN OVERVIEW OF BANKS AND THE FINANCIAL-SERVICES SECTORGoal of This Chapter: In this chapter you will learn about the many roles financial service providers play in the economy today. You will examine how and why the banking industry and the financial services marketplace as a whole is rapidly changing, becoming new and different as we move forward into the future. You will also learn about new and old services offered to the public.Key Topics in This Chapter•Powerful Forces Reshaping the Industry•What is a Bank?•The Financial System and Competing Financial-Service Institutions•Old and New Services Offered to the Public•Key Trends Affecting All Financial-Service Firms•Appendix: Career Opportunities in Financial ServicesChapter OutlineI. I ntroduction: P owerful Forces Reshaping the IndustryII. W hat Is a Bank?A. D efined by the Functions It Serves and the Roles It Play:B. B anks and their Principal CompetitorsC. Legal Basis of a BankD. D efined by the Government Agency That Insures Its DepositsIII.The Financial System and Competing Financial-Service InstitutionsA.Savings AssociationsB.Credit UnionsC.Money Market FundsD.Mutual FundsE.Hedge FundsF.Security Brokers and DealersG.Investment BankersH.Finance CompaniesI.Financial Holding CompaniesJ.Life and Property/Casualty Insurance CompaniesIV. T he Services Banks and Many of Their Closest Competitors Offer the PublicA. S ervices Banks Have Offered Throughout History1.Carrying Out Currency Exchanges2.Discounting Commercial Notes and Making Business Loans3.Offering Savings Deposits4.Safekeeping of Valuables and Certification of Value5.Supporting Government Activities with Credit6.Offering Checking Accounts (Demand Deposits)7.Offering Trust ServicesB. S ervices Banks and Many of Their Financial-Service Competitors HaveOffered More Recently1.Granting Consumer Loans2.Financial Advising3.Managing Cash4.Offering Equipment Leasing5.Making Venture Capital Loans6.Selling Insurance Policies7.Selling Retirement PlansC. Dealing in Securities: Offering Security Brokerage and Investment Banking Services1. Offering Security Underwriting2. Offering Mutual Funds and Annuities3. Offering Merchant Banking Services4. Offering Risk Management and Hedging ServicesV. Key Trends Affecting All Financial-Service FirmsA. S ervice ProliferationB. R ising CompetitionC. G overnment DeregulationD. A n Increasingly Interest-Sensitive Mix of FundsE. T echnological Change and AutomationF. C onsolidation and Geographic ExpansionG. C onvergenceH. G lobalizationVI. T he Plan of This BookVII. S ummaryConcept Checks1-1. What is a bank? How does a bank differ from most other financial-service providers?A bank should be defined by what it does; in this case, banks are generally those financial institutions offering the widest range of financial services. Other financial service providers offer some of the financial services offered by a bank, but not all of them within one institution.1-2. Under U.S. law what must a corporation do to qualify and be regulated as a commercial bank?Under U.S. law, commercial banks must offer two essential services to qualify as banks for purposes of regulation and taxation, demand (checkable) deposits and commercial loans. More recently, Congress defined a bank as any institution that could qualify for deposit insurance administered by the FDIC.1-3.Why are some banks reaching out to become one-stop financial service conglomerates? Is this a good idea in your opinion?There are two reasons that banks are increasingly becoming one-stop financial service conglomerates. The first reason is the increased competition from other types of financial institution s and the erosion of banks’ traditional service areas. The second reason is the Financial Services Modernization Act which has allowed banks to expand their role to be full service providers.1-4. Which businesses are banking’s closest and toughest com petitors? What services do they offer that compete directly with banks’ services?Among a bank’s closest competitors are savings associations, credit unions, money market funds, mutual funds, hedge funds, security brokers and dealers, investment banks, finance companies, financial holding companies, and life andproperty-casualty insurance companies. All of these financial service providers are converging and embracing each other’s innovations. The Financial Services Modernization Act has allowed many of these financial service providers to offer the public one-stop shopping for financial services.1-5. What is happening to banking’s share of the financial mark etplace and why? What kind of banking and financial system do you foresee for the future if present trends continue?The Financial Services Modernization Act of 1999 allowed many of the banks’ closest competitors to offer a wide array of financial services thereby taking away market share from “traditional” banks. Banks and their closest competitors are converging into one-stop shopping for financial services and this trend should continue in the future1-6. What different kinds of services do banks offer the public today? What services do their closest competitors offer?Banks offer the widest range of services of any financial institution. They offer thrift deposits to encourage saving and checkable (demand) deposits to provide a means of payment for purchases of goods and services. They also provide credit through direct loans, by discounting the notes that business customers hold, and by issuing credit guarantees. Additionally, they make loans to consumers for purchases of durable goods, such as automobiles, and for home improvements, etc. Banks also manage the property of customers under trust agreements and manage the cash positions of their business customers. They purchase and lease equipment to customers as an alternative to direct loans. Many banks also assist their customers with buying and selling securities through discount brokerage subsidiaries, the acquisition and sale of foreign currencies, the supplying of venture capital to start new businesses, and the purchase of annuities to supply future funding at retirement or for other long-term projects such as supporting a college education. All of these services are also offered by their closest competitors. Banks and their closest competitors are converging and becoming the financial department stores of the modern era.1-7. What is a financial department store? A universal bank? Why do you think these institutions have become so important in the modern financial system? Financial department store and universal bank refer to the same concept. A financial department store is an institution where banking, fiduciary, insurance, and security brokerage services are unified under one roof. A bank that offers all these services is normally referred to as a universal bank. These have become important because of convergence and changes in regulations that have allowed financial service providers to offer all services under one roof1-8. Why do banks and other financial intermediaries exist in modern society, according to the theory of finance?There are multiple approaches to answering this question. The traditional view of banks as financial intermediaries sees them as simultaneously fulfilling the financial-service needs of savers (surplus-spending units) and borrowers(deficit-spending units), providing both a supply of credit and a supply of liquid assets. A newer view sees banks as delegated monitors who assess and evaluate borrowers on behalf of their depositors and earn fees for supplying monitoring services. Banks also have been viewed in recent theory as suppliers of liquidity andtransactions services that reduce costs for their customers and, through diversification, reduce risk. Banks are also critical in the payment system for goods and services and have played an increasingly important role as a guarantor and a risk management role for customers.1-9. How have banking and the financial services market changed in recent years? What powerful forces are shaping financial markets and institutions today? Which of these forces do you think will continue into the future?Banking is becoming a more volatile industry due, in part, to deregulation which has opened up individual banks to the full force of the financial marketplace. At the same time the number and variety of banking services has increased greatly due to the pressure of intensifying competition from nonbank financial-service providers and changing public demand for more conveniently and reliably provided services. Adding to the intensity of competition, foreign banks have enjoyed success in their efforts to enter countries overseas and attract away profitable domestic business and household accounts.1-10. Can you explain why many of the forces you named in the answer to the previous question have led to significant problems for the management of banks and other financial firms and their stockholders?The net result of recent changes in banking and the financial services market has been to put greater pressure upon their earnings, resulting in more volatile returns to stockholders and an increased bank failure rates. Some experts see banks' role and market share shrinking due to restrictive government regulations and intensifying competition. Institutions have also become more innovative in their service offerings and in finding new sources of funding, such as off-balance-sheet transactions. The increased risk faced by institutions today, therefore, has forced managers to more aggressively utilize a wide array of tools and techniques to improve and stabilize their earnings streams and manage the various risks they face. 1-11. What do you think the financial services industry will look like 20 years from now? What are the implications of your projections for its management today? There appears to be a trend toward continuing consolidation and convergence. There are likely to be fewer financial service providers in the future and many of these will be very large and provide a broad range of financial services under one roof. In addition, global expansion will continue and will be critical to the survival of many financial service providers. Management of financial service providers willhave to be more technologically astute and be able to make a more diverse set of decisions including decisions about mergers, acquisitions and global expansion as well as new services to add to the firm.Problems and Projects1. You have just been hired as the marketing officer for the new First National Bank of Vincent, a suburban banking institution that will soon be serving a local community of 120,000 people. The town is adjacent to a major metropolitan area with a total population of well over 1 million. Opening day for the newly chartered bank is just two months away, and the president and the board of directors are concerned that the new bank may not be able to attract enough depositors and good-quality loan customers to meet its growth and profit projections. There are 18 other financial-service competitors in town, including two credit unions, three finance companies, four insurance agencies, and two security broker offices. Your task is to recommend the various services the bank should offer initially to build up an adequate customer base. You are asked to do the following:a.Make a list of all the services the new bank could offer, according to current regulations.b.List the type of information you will need about the local community tohelp you decide which of the possible services are likely to have sufficientdemand to make them profitable.c.Divide the possible services into two groups--those you think are essentialto customers and should be offered beginning with opening day, and thosethat can be offered later as the bank grows.d. Briefly describe the kind of advertising campaign you would like to run tohelp the public see how your bank is different from all the other financialservice providers in the local area. Which services offered by the nonblankservice providers would be of most concern to the new bank’smanagement?Banks can offer, if they choose, a wide variety of financial services today. These services are listed below. However, unless they are affiliated with a larger bank holding company and can offer some of these services through that company, it may be more limited in what it can offer.Regular Checking Accounts Management Consulting Services NOW Accounts Letters of CreditPassbook Savings Deposits Business Inventory Loans Certificates of Deposit Asset-Based Commercial Loans Money Market Deposits Discounting of Commercial Paper Automobile Loans Plant and Equipment Loans Retirement Savings Plans Venture Capital LoansNonauto Installment Loans to IndividualsResidential Real Estate Loans Leasing Plans for Business Property and EquipmentHome Improvement Loans Security Dealing and Underwriting Personal Trust Management Services Discount Security BrokerageCommercial Trust Services Institutional Trust Services Foreign Currency Trading and ExchangePersonal Financial Advising Personal Cash-Management ServicesInsurance Policy Sales (Mainly Credit-Life)Insurance Today (Except in Some States)) Standby Credit Guarantees Acceptance FinancingTo help the new bank decide which services to offer it would be helpful to gather information about some of the following items in the local community:School Enrollments and Growth in School EnrollmentsEstimated Value of Residential and Commercial PropertyRetail SalesPercentage of Home Ownership Among Residents in the AreaNumber and Size (in Sales and Work Force) of Local Business Establishments Major Population Locations (i.e., Major Subdivisions, etc.) and Any Projected Growth AreasPopulation Demographics (i.e., Age Distribution of the Area)Projected Growth Areas of Industries in the AreaEssential services the bank would probably want to offer right from the beginning includes:Regular Checking Accounts Home Improvement Loans Automobile and other Consumer-type Money Market Deposit Accounts Installment Loans Retirement Savings PlansNOW Accounts Business Inventory LoansPassbook Savings Deposits Discounting of High-QualityCommercial NotesResidential Real Estate LoansCertificates of DepositAs the bank grows, opportunities for the profitable sale of additional services usually increase, especially for trust services for individuals and smaller businesses and personal financial advising as well as some commercial (plant and equipment) loans and leases. Further growth may result in the expansion of commercial trust services as well as a widening variety of commercial loans and credit guarantees.The bank would want to develop an advertising campaign that sends a message to potential customers that the new bank is, indeed, different from its competitors. Small banks often have the advantage of offering highly personalized services in which their customers are known and recognized and services are tailored to each individual customer's special financial needs. Quality and reliability of banking service are often more important to individual customers than is price. A new bank must try to sell prospective customers, most of who will come from other banks in the area, on personalized services, quality, and reliability - all three of which should be emphasized in its advertising program.2. Leading money center banks in the United States have accelerated their investment banking activities all over the globe in recent years, purchasing corporate debt securities and stock from their business customers and reselling those securities to investors in the open market. Is this a desirable move by these banking organizations from a profit standpoint? From a risk standpoint? From the public interest point of view? How would you research their question? If you were managing a corporation that had placed large deposits with a bank engaged in such activities, would you be concerned about the risk to your company's funds? What could you do to better safeguard those funds?In the 1970's and early 1980's investment banking was so profitable that commercial bankers were lured into the investment banking business largely because of its greater profit potential than possessed by more traditional commercial banking activities. Later foreign banks, particularly the British and Japanese banking firms, began to attract away large corporate customers from U.S. banks, who were restrained by regulation from offering many investment banking services. Thus, U.S. banks ran into severe difficulty in simply trying to hold onto their traditional corporate credit and deposit accounts because they could not compete service-wise in the investment banking field. Today, banks are allowed to underwrite securities through either a subsidiary or through a holding company structure. This change occurred as part of the Gramm-Leach-Bliley Act (Financial Services Modernization Act).Unfortunately, if investment banking is more profitable than traditional banking product lines, it is also more risky, consistent with the basic tenet of finance that risk and return are directly related. That is why the Federal Reserve Board has placed such strict limits on the type of organization that can offer these services. Currently, the underwriting of most corporate securities must be done through a subsidiary or as a separate part of the holding company so that, in theory at least, the bank is not responsible for any losses incurred. For this reason there may be little reason for depositors (including large corporate depositors) to be concerned about risk exposure from investment banking. Moreover, the ability to offer such services may make U.S. banks more viable in the long run which helps their corporate customers who depend upon them for credit.On the other hand, opponents of investment banking powers for bank operations inside the U.S. have some reasonable concerns that must be addressed. There are, for example, possible conflicts of interest. Information gathered in the investment banking division could be used to the detriment of customers purchasing other bank services. For example, a customer seeking a loan may be told that he or she must buy securities from the bank's investment banking division in order to receive a loan. Moreover, banks could gain effective control over some nonblank industrial corporations which might subject them to added risk exposure and place industrial firms not allied with banks at a competitive disadvantage. As a result theGramm-Leach-Bliley Act has built in some protections to prevent this from happening.3. The term bank has been applied broadly over the years to include a diverse set of financial-service institutions, which offer different financial service packages.Identify as many o f the different kinds of “banks” as you can. How do the “banks” you have identified compare to the largest banking group of all – the commercial banks? Why do you think so many different financial firms have been called banks? How might this terminological confusion affect financial-service customers?The general public tends to classify anything as a bank that offers some sort of financial service, especially deposit and loan services. Other institutions that are often referred to as a bank without being one are savings associations, credit unions, money market funds, mutual funds, hedge funds, security brokers and dealers, investment banks, finance companies, financial holding companies and life and property/casualty insurance companies. All of these institutions offer some of the services that a commercial bank offers, but generally not the entire scope of services. Since providers of financial services are normally called banks by the general public they are able to take away business from traditional banks and it is of utmost importance for commercial banks to clarify their unique position among financial services providers.4. What advantages can you see to banks affiliating with insurance companies? How might such an affiliation benefit a bank? An insurer? Can you identify any possible disadvantages to such an affiliation? Can you cite any real world examples of bank-insurer affiliations? How well do they appear to have worked out in practice?Before Glass-Steagall banks used to sell insurance services to their customers on a regular basis. in particular, banks would sell life insurance companies to loan customers to ensure repayment of the loan in case of death or disablement. These reasons still exist today and the right to sell insurances to customers again benefits banks in allowing them to offer their customers complete financial packages from financing the home or car to insure it, from giving investment advice to selling life insurance policies and annuities for retirement planning. Generally, a bank customer who is already purchasing a service from a bank might feel compelled to purchase an insurance product, as well. On the other hand, insurance companies sometimes have a negative image, which makes it more difficult to sell certain insurance products. Combining their products with the trust that people generally have in banks will make it easier for them to sell their products. The most prominent example of a bank-insurer affiliation is the merger of Citicorp and Traveler’s Insurance to Citigroup. However, given that Citigroup has sold Traveler’s Insurance indicates that the anticipated synergy effects did not materialize.5. Explain the difference between consolidation and convergence. Are these trends in banking and financial services related? Do they influence each other? How? Consolidation refers to increase in the size of financial institutions and the decline in the number of small independently owned banks and financial service providers. Convergence is the bringing together of firms from different industries to createconglomerate firms offering multiple services. Clearly, these two trends are related. In their effort to compete with each other, banks and their closest competitors have acquired other firms in their industry as well across industries to provide multiple financial services in multiple markets.6. What is a financial intermediary? What are their key characteristics? Is a bank a type of financial intermediary? Why? What other financial-services companies are financial intermediaries? What important role within the financial system do financial intermediaries play?A financial intermediary is a business that interacts with deficit spending individuals and institutions and surplus spending individuals and institutions. For that reason any financial service provider (including banks) is considered a financial intermediary. In their function as intermediaries they act as a bridge between the deficit and surplus spending units by offering financial services to the surplus spending individuals and then loaning those funds to the deficit spending individuals. Financial intermediaries accelerate economic growth by increasing the pool of available funds and lowering the risk of investments through diversification.。

ProfessionalprofileFinance is the circulation of value. Finance is the floorboard of monetary and credit activities and the associated economic activities, refers to all the broader financial and credit currency issue, storage, exchange, settlement, factoring the economic activities, including the sale of gold and silver, narrow financial refers to the currency of credit intermediationIs a kind of financial transactions, financial transactions itself does not create value, then why in the financial transaction is profitable? According to Mr Chen Zhiwu, the financial transaction is a kind of future revenue realization way, also is tomorrow's money today to spend. Simply say financial transactions often reflects a region, regional, and even national economic prosperity of the important indicators.ProfessionalintroductionCategory: economics school year: 4 years degree: Bachelor of economics opened number: 166Finance is a very popular subject, the finance professional study of modern financial institutions, financial markets and the motion law of financial and economic. The research contents include: Theory and practice of non bank financial institutions of banking and securities, insurance, theory and practice of monetary market, capital market and international financial market, the theory and practice about the financial macroeconomic regulation and control and the financial and economic and financial management, especially on the theory and practice of financial risk management. The main research direction of money and banking, financial and economic (including international finance, financial theory), investment, insurance, corporate finance (Finance). Finance to cancel the previous exam form. The university is the independent proposition, independent scoring way the organization of the examination. Training objectivesFinance professional training to master the basic knowledge of Marx's basic principles of economics and FinanceFinancial professionalsThe basic knowledge and theory, financial operation and financial market and basic skills; familiar with the operation mechanism of international financial regulation, convention and WTO; familiar with China's foreign financial management policies and regulations, understand the development of contemporary financial market; use modern means of science and technology, modern financial business operation and solid language ability application financial professionals.Training requirementsThe basic theory study, mainly study the monetary and banking students of this major international financial, securities, investment, insurance and basic knowledge, basic training by the relevant business, basic ability of practical working in the financial field.Employment directionLook from whole, finance in the past few years in enter oneself for an examination is hot, the occupation generally optimistic about the prospects, but according to the actual employment situation, more serious polarization, according to the observation statistics are education center of economics exam findings, master of finance of the well-known colleges and universities, if the teacher influence, during the period of school practice, and research knowledge more profound, just out of school to get more than 100000 annual salary, not in the minority.The editor of the employment situationIn recent years, China's financial market is moving towards internationalization, on a very strong professional talent demand urgently. Master of Finance employment demand mainly concentrated in the high-end market, such as analysis, research universities and large companies market fund manager, investment manager, securities companies, insurance companies, Trust Investment Company.The direction ofWhether graduate or graduate, employment direction, finance professional graduates on the whole economic analysis and forecasting, foreign trade, marketing, management, if we can get some qualifications, employment opportunities will be broader, more employment level, and better treatment, such as the Chartered Financial Analyst (CFA), chartered wealth manager (CWM), fund managers, actuaries, securities brokers, stock analysts, etc..1. The economy analysis and Management ConsultantsEconomic forecasting analysts industry distribution is very wide, but usually only in the various sectors of the Multi-National Corporation, economic decision making departments, large and medium-sized enterprises and government public research institutes will be set. Is mainly responsible for the collection and analysis of market data.The growing importance of the job. Management Consultants is mainly to some consulting company, such as IT advisory, strategic consulting, marketing consulting, auditing, listed counselling.2. The foreign trade personnelThe "world factory" products, sold to foreign customers; for domestic customers looking for foreign sources; organization of international trade of goods and logistics. A considerable part of foreign trade in the experience of mature workers, set up their own foreign trade company.3. Management positionGraduate and undergraduate students are not the same, most are involved in some social practice during my master's degree, with some work experience, formal entry into society, also make a number of management positions, such as production, management, administration, personnel management, financial management.4. The fund managerAmong them, with more funds and fund management companies, society will need many of the fund managers, fund manager is a line of high level talents, its functions can be divided into: responsible for raising a fund; responsible for the operation of the fund and management; responsible for the listing and fund after the listing. This person is very scarce, optimistic about the prospects of occupation. Fund industry occupation managers and fund managers demand maximum. To become a qualified fund manager is not easy, generally has a master's degree, a risk management professional background, but also has the ability to analyze and judge the multidisciplinary, strong industries, have a keen market sense of smell, rich experience is a must.5. The securities brokerSecurities brokers quality requirements mainly concentrated in two aspects: one is a solid knowledge of finance fund; two is the long after observation of the market based on the investment experience; because of the securities investment is high risk, high return investment, as securities broker must be based on the study of regime change in trend of market prices, to grasp the law analysis of the influence of various factors, the price of the securities and, gradually accumulated and considerable experience in investment and skilled operation have the ability.Chinese number of investors line up. Provides a huge market this huge investment groups has been the rise of the securities broker. Securities brokers in China Securities salesman, commission agent, broker, intermediary broker of exchange points.6. The stock analystsStock analysts mainly for stock investors stock market investment advisory services, and organize relevant seminars, report, analysis, part of the stock analysts analysts published articles in newspapers, as well as providing stock market through radio, television and other public media investment services. In the analysis of stock in China, must have a bachelor's degree orabove, more than two years experience in the securities business, needs assessment "securities investment theory", "securities investment analysis of" the two courses. Through the examination qualified personnel to the local securities regulatory authorities or directly apply to the China Securities Regulatory Commission, after approval, to obtain the qualification certificate. Qualified personnel to apply to the securities administration departments of the securities investment consulting agencies, to obtain the practice qualification, and finally by the Chinese Association of Securities Issuing the practicing certificate.FutureThe structural contradiction of China financial talent is outstanding, the following categories of people: one is the lack of senior management personnel is able to act as a leader; two is the compound talents proficient in a foreign language, law and computer; three is legal, consulting, intermediary and the accounting and other aspects of senior professionals, international financial management and the experience of the financial personnel and financial service talents.In addition, the financial industry for many intermediate business, also need to senior professionals to enter, such as personal financial product design, customer funds for investment income.Salary levelFinance research graduate students in the salary income gap is relatively large, with the reputation and influence of the school, teacher, and shape, its ability to experience closely related. Among them, financing and capital operation, consulting services, some of the broader development prospects, but also a lot of income. A monthly salary of at least 6000 yuan, 30000 yuan more than the.If can enter the transnational investment bank or Accenture, McKinsey and other transnational consulting company, salary is mostly about 200000, there are other benefits.。

审计英语核心词汇Auditing English Core VocabularyAuditing is a meticulous process that involves the examination and verification of an individual's or organization's financial records and statements. It is essential for maintaining transparency, accountability, and integrity in financial management. The following is a comprehensive list of core vocabulary terms that are fundamental to understanding and practicing auditing in English.1. Audit- The systematic review and evaluation of financial information to ensure accuracy, compliance, and integrity.2. Auditor- A professional who conducts audits to assess financial statements and ensure they meet regulatory standards.3. Financial Statements- Formal records that depict the financial performance and position of a business, including balance sheets, income statements, and cash flow statements.4. Internal Control- The system of policies, procedures, and controls established by a business to ensure the reliability of financial reporting, compliance with laws, and efficiency of operations.5. External Audit- An audit conducted by an independent auditor who is not part of the organization being audited.6. Internal Audit- An audit carried out by an auditor who is part of the organization, focusing on internal controls and risk management.7. Audit Trail- A documented record or history of transactions and events that have affected a financial process or system.8. Compliance Audit- An examination to determine whether an organization is adhering to specific regulatory requirements.9. Risk Assessment- The process of identifying, analyzing, and evaluatingrisks to determine how they might affect an entity's objectives.10. Sampling- The selection of a manageable subset of data from a larger population to estimate characteristics of the whole.11. Materiality- The threshold at which the magnitude of a misstatement, if recorded, could influence the judgment of users of financial statements.12. Audit Report- A formal document that communicates the results of the audit, including any findings, conclusions, and recommendations.13. Fraud- The use of deception to obtain an unjust or illegal advantage, often for financial gain or to harm another individual's financial status.14. Going Concern- An assumption in accounting that an entity will remain in operation for the foreseeable future.15. Audit Evidence- Information that is obtained and used as a basis for the auditor's conclusions about the financial statements.16. Due Diligence- The process of performing a thorough investigation or analysis of a business's financial and legal standing before entering into an agreement or transaction.17. Qualified Opinion- An auditor's report that includes a modification to the standard unqualified opinion, indicating a limitation or scope restriction.18. Unqualified Opinion- An auditor's report that states the financial statements are presented fairly and in compliance with the applicable financial reporting framework.19. Audit Plan- A detailed strategy that outlines the scope, timing, and resources required to perform an audit.20. Professional Skepticism- An attitude of cautious skepticism that auditorsmaintain throughout the audit process to critically assess evidence and information.Understanding these core auditing terms is crucial for anyone involved in the field of finance, whether as an auditor, an accountant, or a business executive. It provides a solid foundation for engaging in conversations and tasks related to financial audits.。

英文安永审计报告Audit ReportThe audit report is a comprehensive document that provides an independent assessment of an organization's financial statements, internal controls, and compliance with relevant laws and regulations. As a leading professional services firm, Ernst & Young (EY) is renowned for its expertise in conducting rigorous audits and delivering insightful analysis to its clients. This report outlines the key findings and recommendations from the EY audit of the financial statements of a client organization for the fiscal year ended December 31 2022.Financial Statements ReviewThe audit team conducted a thorough examination of the client's financial statements including the balance sheet, income statement, statement of cash flows, and related notes to the financial statements. The team's review focused on ensuring the accuracy, completeness, and fair presentation of the financial information in accordance with generally accepted accounting principles (GAAP).Overall the audit team found that the financial statements presentfairly in all material respects the financial position of the organization as of December 31 2022 and the results of its operations and its cash flows for the year then ended in conformity with GAAP. The team identified no material misstatements or exceptions in the financial reporting.The balance sheet as of December 31 2022 reflects total assets of $125 million and total liabilities of $75 million resulting in total shareholders' equity of $50 million. The income statement for the year ended December 31 2022 shows total revenues of $200 million and net income of $20 million. The statement of cash flows demonstrates the organization generated $30 million in net cash from operating activities.Internal Controls AssessmentA key component of the audit involved evaluating the design and operating effectiveness of the organization's internal control environment. The audit team conducted walkthroughs of key business processes interviewed personnel and tested relevant controls to assess their adequacy in mitigating financial reporting risks.In the team's assessment the organization maintains an effective system of internal controls over financial reporting. No material weaknesses or significant deficiencies were identified that couldpotentially impact the reliability of the financial statements. The controls tested were found to be suitably designed and operating effectively to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP.The organization has established a strong control environment with clear assignment of authority and responsibility. Key controls were noted in the areas of cash management accounts receivable and payable inventory management and payroll processing. The team commends the organization's proactive approach to maintaining a robust internal control framework.Compliance ReviewAs part of the audit the team also reviewed the organization's compliance with applicable laws regulations and contractual agreements. This included an assessment of the company's adherence to requirements related to tax filings employee benefit plans and industry-specific regulations.The audit team found the organization to be in substantial compliance with the relevant laws and regulations. No instances of non-compliance were identified that could have a material effect on the financial statements. The organization appears to have appropriate processes and controls in place to ensure ongoingcompliance.One area noted for potential improvement relates to the organization's policies and procedures for monitoring changes in laws and regulations. The audit team recommends enhancing the compliance function to proactively identify and assess the impact of new or amended requirements. This will help ensure the organization remains fully compliant on an ongoing basis.Overall Conclusion and RecommendationsBased on the procedures performed and evidence obtained the EY audit team concludes that the financial statements of the organization present fairly in all material respects the financial position results of operations and cash flows for the year ended December 31 2022 in conformity with GAAP. The organization maintains an effective system of internal controls over financial reporting and is in substantial compliance with applicable laws and regulations.To further strengthen the organization's financial reporting and compliance the audit team recommends the following:- Enhance the compliance function to proactively monitor changes in laws and regulations- Formalize the process for reviewing and updating accounting policies and procedures on a periodic basis- Implement additional controls around the review and approval of journal entries- Provide enhanced training to finance and accounting personnel on recent GAAP updatesThe EY team appreciates the cooperation and assistance provided by the client's finance and accounting staff throughout the audit process. We are available to discuss the findings and recommendations in more detail. Please let us know if you have any questions or require additional information.。

财务经理年终总结英语Year-End Summary of the Finance ManagerAs the year es to an end, it is essential to reflect on the financial performance and management of our organization. This year has presented numerous challenges and opportunities, and I am proud to share the acplishments and lessons learned during this period.In terms of financial operations, we have successfully mntned a stable cash flow throughout the year. This was achieved through meticulous budgeting, efficient cost control measures, and timely collection of receivables. Our team closely monitored the financial indicators and made strategic adjustments to ensure the financial health of the pany.Budgeting and forecasting have been at the core of our financial planning process. We developed accurate and realistic budgets that provided a clear roadmap for the organization's financial activities. Regular reviews and updates were conducted to align with the changing business environment and market dynamics.Financial reporting has also been strengthened to provide transparent and reliable information to stakeholders. Timely and accurate financial statements were prepared, enabling management to make informed decisions. We also enhanced internal controls to safeguard the pany's assets and ensure pliance with relevant regulations.One of the significant achievements this year was the successful implementation of a new financial software system. This has streamlined our processes, improved data accuracy, and enhanced overall efficiency in financial management.However, we also faced some challenges. The economic uncertnties and market fluctuations posed difficulties in forecasting and planning. Additionally, the constantly evolving regulatory environment required us to stay updated and adapt our financial strategies accordingly.Looking forward to the next year, our focus will be on further optimizing the financial structure, enhancing risk management capabilities, and exploring new investment opportunities to drive growth. We will continue to improve our financial processes and build a more resilient and agile financial framework.In conclusion, this year has been a year of growth and learning for the finance department. I am grateful to the entire team for their hard work and dedication, and I am confident that we will continue to achieve excellence in financial management in the years to e.。

To whom it may concern,I deem it a great pleasure to write this letter of reference on behalf of Miss xxx to support her application to study in your university.I am the dean of Finance School in Shanghai University of Finance and Economics, and Miss xxx is one of my students majoring in International Finance. I have known her very well in terms of personality and academic performance. The intelligent nature and sense of logical analysis make her powerful in mastering complicated theories. In her active participation in the campus activities, she has demonstrated her intellectual independence as well as impressive ability. Additionally, she expresses her ideas clearly and has good analytical skills, which give me deep impression. For example, Zhao once participated in the debate competition and worked as the fourth debater. She took charge of free debate and summary remarks that were very important in the competition. To my surprise, Miss xxx finished the task very excellently thanks to her agile mind and quick analysis ability. Miss xxx clearly analyzed the opposite side’s weaknesses, simultaneously; she also conquered many committee members. Because of their good performance and cooperation, they finally obtained outstanding result. Miss xxx was awarded the honor of “The Best Debater”.Apart from her intelligence, Miss xxx was an independent and energetic girl who took part in many large-scale activities enthusiastically. I found that xxx took part in most of the activities and did a nice job. In 2005 she took part in the badminton competition and got the champion of women's doubles. Besides, Miss xxx had good teamwork spirit and cooperated with the schoolmates tacitly.Based on my appreciation of such an ambitious student who receives the challenge bravely, I strongly support She’s decision of higher academic pursuit without reservation. And I sincerely hope my recommendation will receive your favorable consideration.Yours Honestly,xxxDear Professor：Miss xxx requested a letter of reference from me to support her application for graduate studies at your university. As her tutor when she prepared her project design for graduation, I am pleased to comply with her request.I became acquainted with Miss xxx when I met her beautiful writing on her mathematic assignments and I remembered her name at once. When I taught her, she always sat on the left place behind the classroom, then I asked her why, she answered me that she likes to see all corners of classroom with smiles on her face. But I was astonished by her learning ability; she listened to my lesson with her thought, especially when I taught them some emphases and difficulties of the course, she always listened to me earnestly and recorded these difficulties on her note carefully, after class, she came to me and talked about these questions which included some principle of mathematics, I was impressed by her unique views about mathematics which reflected her thought and logic better than other students.It was worthy to mention her learning ability on mathematics, for example, I didn’t finish my predication logic lesson because of limit time and just simply mentioned the concept, when I checked students’assignments and found only she gave me prefect answer with deductive ways and her thought was very clear. Meanwhile I was gratified by her apperception ability andself-taught ability, she was a girl with nimbus and big potential. Besides her apply ability was also very strong. In her junior year, she took part in my teaching reform project which analyzed the result of improving mathematic teaching quality. She was so familiar with the model of mathematics that she suggested that we may choose AHP model instead of normal faintness judge way to carry on quantitative analysis, and I accepted her suggestion and finished together the paper of “arrangement analytical method applies on the classroom interaction teaching effective comment”which will be published in the future.Miss xxx told me that she will apply for finance engineering which is a new field for her. I am glad to recommend this excellent girl who already possessed good quality and strong ability. I therefore lend her my enthusiastic support and would appreciate you favorable consideration of her application.Sincerely yoursxxx。

Guide for Summary Writing1.First read the passage through carefully to get the gist of it.2.Give a title to your summary. Think of some word, phrase or short sentencethat will sum up briefly the main idea of the passage.3.Decide on what parts of the passage are essential and what are comparativelyunimportant and can be omitted without much loss.4.Jot down in brief notes the main points.5.The summary should be about one-third or one fourth the length of theoriginal passage.6.The summary should be all in your own words. It should not be a patchworkmade up of phrases and sentences quoted from the original passage.7.You should follow the logical order of the original passage, if possible.8.The summary must convey the message of the original fully and clearlywithout reference to the original to understand what its main ideas are.9.The summary should be compressed by:Omitting the details –all the details that explains the main points canbe left out.Reducing the examples –Out of five or six examples given in the originalpassage, one of two may be chosen for thesummary.Simplifying the descriptions – If in the passage there are ten sentencesdescribing a person or an object, it will beenough to keep one or two in the summary.Eliminating all repetitions - Sometimes a statement is repeated for emphasis.This is not necessary in a summary.Compressing wordy sentences and changing phrases to words. Here are a few examples:“His courage in battle might without exaggera tion be called lion-like.”He was very brave in battle.“The account the witness gave of the incident made everyone thatheard it laugh.”The witness’s story was absurd.Making phrases do the work of clauses or sentences. Here is an example: Beautiful mountains like Mount Tai, Lushan Mountain, and YellowMountain, were visited by only a few people in the past. Today, betterwages, holidays with pay, new hotels on those mountains, and bettertrain and bus services, have brought them within reach of many whonever thought of visiting them ten years ago.Beautiful mountains like Mount Tai, once visited by only a few people, are today accessible to many, thanks to better wages, paid holidays, new hotels and better communication.Using general words instead of specific words. Here is an example:She brought home several Chinese and English novels, a few copies of Time and Newsweek, and some textbooks. She intended to read all of them during the winter vacation.She brought home a lot of books and magazines to read during thevacation.Using the shortest possible transitions. For example, but, then, thus, yet, and for, can be used in place of longer transitions like at the same time, on the other hand, etc.Putting the main points of a dialogue in indirect speech. Here is an example:Kate looked at Paul disapprovingly: You use much too much salt on your food, Paul –it’s not at all good for you!” Paul put down his knife and frowned: “Why on earth not! If you didn’t have salt on your food it would taste awful…like eating cardboard or sand…just imagine bread without salt in it, or potatoes or pasta cooked without salt!” Kate was patient. She didn’t want to quarrel with Paul. She wanted to persuade him. She said firmly: “But too much salt is bad for you. It causes high blood pressure and later on, heart-attacks. It also disguises the tastes of food, the real tastes, which are more subtle than salt, and which we have lost the sensitivity to appreci ate any more.”Kate suggested to Paul that he should eat less salt. She thought that eating too much salt would do harm to Paul’s health and that it could reduce the real tastes of food. But Paul disagreed. He said that food without salt would be tasteless.Summary WritingOriginalA third kind of thinking is stimulated when anyone questions our beliefs and opinions. We sometimes find ourselves changing our minds without any resistance or heavy emotion, but if we are told that we are wrong we resent the imputation and harden our hearts. We are incredibly heedless in the formation of our beliefs, but find ourselves filled with an illicit passion for them when anyone proposes to rob us of their companionship. It is obviously not the ideas themselves that are dear to us, but our self-esteem, which is threatened. We are by nature stubbornly pledged to defend our won from attack, whether is be our person, our family, our property, or our opinion. We may surrender, but rarely confess ourselves vanquished. In the intellectual world at least, peace is without victory.Few of us take the pains to study the origin of our cherished convictions; indeed, we have a natural repugnance to so doing. We like to continue to believe what we have been accustomed to accept as true, and the resentment aroused when doubt is cast upon any of our assumptions leads us to seek every manner of excuse for clinging to them. The result is that most of our so-called reasoning consists in finding arguments for going on believing as we already do.(229 words)- James Harvey RobinsonSummaryA third kind of thinking occurs when we are told that our beliefs and opinions are wrong. We may have been heedless in their formation, but our self-esteem will not permit us to change. We may have to give up, but we are not convinced. We do not study the origin of our beliefs; we believe as we have been accustomed to believe, and we seek arguments for continuing to believe as we already do.(75 words)Summary Writing ExerciseOriginalXiao Lu is a sanitation worker in a restaurant, a much honored one. She has been awarded for her “excellent work and satisfactory service” by the National Tourism Administration four times since she took the job six years ago.Her job seems simple. Every morning, she is required to clean two washrooms, two bathrooms, two locker rooms, the balcony and the corridor. But it is hard and demanding work, especially for a girl who suffers from heart disease. “I usually have to come at 8:30 – half an hour before the working time begins, and start to bustle in and out without a break, “says Liu. At 11 o’clock – the opening time of the restaurant, everything is washed up. So is she. Then she stands in front of the washrooms to greet every guest with a smile, help them and to the cleaning whenever it is necessary.“It is unusual work for such a young woman,” says the manager of the restaurant. “It is not only the hard w ork but also the psychological pressure that she has to stand.”“I felt very ashamed and humble when I stood in front of the washroom on my first working day,” recalls Liu. Then only 17 years old she blushed whenever a guest came. Her colleagues poked fun at her and her friends called her a fool.“Because of my work, they think I am inferior and can only work in the washrooms. But I am not,” she says. And the young woman, who had been eager to do everything well since she was a child, vowed to prove it.Four years ago, she was honored as Excellent Sanitation Worker by the National Tourism Administration. It was the happiest day of her life. “Standing on the stage, I cried, because it is not only a prize, but a kind of understanding and recognition,” Liu says.In spite of the heavy work during the daytime, Liu spends every night learning from her sister’s textbooks. “Sometimes I read till 3 o’clock in the morning and get up at 6 to go to work,” she says. Two years ago, she passed the entrance examination for the “Worker College”, and this year, she obtained a diploma in finance. Her thesis was selected for excellence and was honored at the commencement.(380 words)- Zhang Xiaohong SummaryXiao Lu is a model worker doing clean-up work in a restaurant. Her daily chores include cleaning the washrooms and bathrooms. When she first started at the age of 17, she felt ashamed of it, and people laughed at her. But the young woman has overcome all difficulties and excelled in her work. For this, she won an award. She also studied hard at night, sometimes well into the early hours. In the end she graduated from the “Worker College” with good results.(83 words)。

FinanceLecture 2An Overview of the Financial System I•Function of Financial Markets •Structure of Financial Markets •Financial Market Instruments •Internationalization of Financial MarketsLearning ObjectivesCompare direct and indirect finance.Identify the structure and components of financial markets. Describe different types of financial market instruments.Recognize the international dimensions of financial markets.Part 1Function of Financial Markets1.1 Financial MarketsFinancial Markets (P2)：Markets in which funds are transferred from people who have an excess of available funds to people who have a shortage.金融市场：资金从那些可用资金过剩的人转移到资金短缺的人的市场。

1.2 Direct FinanceIn direct finance (P23), borrowers borrow funds directly from lenders in financial markets by selling the lenders securities (also called financial instruments).在直接融资中，借款人通过在金融市场出售证券（也称为金融工具），直接从贷款人手中借入资金。