Alcoa to slice 15% off payroll costs at Quebec plants
With the hard hit economy, Alcoa Inc., the largest U.S. aluminum producers, is one of those companies who are having a hard time making a profit due to the drop in prices of lightweight metal. Their Canadian non-union salary employees might be affected by the 15% cut to their payroll so that the company can conserve some cash. Alcoa know that it is “part of managing through the downturn and focusing on cash”. The company needs money in hand to keep the company going because their most recent financial statements have shown a net loss of the company.
This article is related to our chapter 16 about payroll accounting because this article is dealing with the payroll cost to their employees on a regular basis over a period of time. The company’s payroll department needs to consider and go through so many laws and regulations before they actually decrease the wages of their employees. They have a large role to play. Also, the workers are earning a non-union salary which means they should be paid a fixed sum of money, for the salary part, but since it is a non-union salary, the company has the ability to changing their employee’s salary amount.
I believe that Alcoa is a considerate company. At least, they considered only reducing their payroll by 15% and not laying them off or firing them. It is good to know that the employees still have a job so that they have some sort of finance that is supporting them. As we all know, employees are in desperate need in keeping their jobs secure so I believe they wouldn’t mind having a 15% deduction to their salary. I think a 15% decrease to my salary would be horrifying but I would have to accept the fact that I might not even receive a pay check at all.
courtesy of: http://www.nationalpost.com/story.html?id=1353771
Saturday, March 14, 2009
Tuesday, March 3, 2009
Chapter 15 - Analyzing Financial Statements
Steady as she goes for Canada's top banks
The economic crisis is slowly catching up on Canada’s top five banks. Even though Banks in Canada are steadily earning profit, there is still a show in increase of bad loans and investment losses. With the stocks plunging to its lowest of this week, the banks still has strong domestic retail franchises to back them up for them to earn a profit. There is more for the banks to bear when they anticipate the arrival of a recession. This would then increase the loan losses which will lead to lost in assets. Banks are depending on Canadian consumers to consumer more to help ease the economy, just like in the past.
Later in the article, it compares two banks, BMO and Bank of Nova Scotia, to show how the bank industry is going. For example, they compare Bank of Nova Scotia has a flat income of $842 million, or 80¢ /share; and BMO has a drop in net income of 12% to $ 225 million, or 96¢/share. By comparing two different banks together, we can use comparative data such as comparative balance sheets and income statements to help manage, improve, and predict what should be done in the future. By using this method, insiders and outsiders can compare different banks to see which one they should invest in. The topic of comparative data is learned in section 15.2.
I can understand many people are scared to leave their money in banks since there might be a chance of the bank going bankrupt. Due to the current poor economy, many people in the world would not spend as much money compared to last year, but this is why our economy is getting worst. It is because no one wants to spend their money. It is a hard time for many to go through, but to up roar the economy to get it running smoothly again, it would take many people’s effort to achieve it.
http://www.financialpost.com/news-sectors/financials/story.html?id=1348121
The economic crisis is slowly catching up on Canada’s top five banks. Even though Banks in Canada are steadily earning profit, there is still a show in increase of bad loans and investment losses. With the stocks plunging to its lowest of this week, the banks still has strong domestic retail franchises to back them up for them to earn a profit. There is more for the banks to bear when they anticipate the arrival of a recession. This would then increase the loan losses which will lead to lost in assets. Banks are depending on Canadian consumers to consumer more to help ease the economy, just like in the past.
Later in the article, it compares two banks, BMO and Bank of Nova Scotia, to show how the bank industry is going. For example, they compare Bank of Nova Scotia has a flat income of $842 million, or 80¢ /share; and BMO has a drop in net income of 12% to $ 225 million, or 96¢/share. By comparing two different banks together, we can use comparative data such as comparative balance sheets and income statements to help manage, improve, and predict what should be done in the future. By using this method, insiders and outsiders can compare different banks to see which one they should invest in. The topic of comparative data is learned in section 15.2.
I can understand many people are scared to leave their money in banks since there might be a chance of the bank going bankrupt. Due to the current poor economy, many people in the world would not spend as much money compared to last year, but this is why our economy is getting worst. It is because no one wants to spend their money. It is a hard time for many to go through, but to up roar the economy to get it running smoothly again, it would take many people’s effort to achieve it.
http://www.financialpost.com/news-sectors/financials/story.html?id=1348121
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