Trend Forecasting Steps For Analysis

Trend Forecasting Steps

Fashion forecasting is generally a career that involves focusing on upcoming trends in the fashion industry. Fashion and trend forecasting is the future determination of mood, behavior and purchasing habits of consumer at a given time of season. It does not only involve determination of markets, consumers in terms of age, their locations and income but also inquire deeply to get to know what they purchase depending on their culture, beliefs, moods as well as geographical location.  Fashion and trend forecasting is more reliant on fashion cycle and plays a significant role in introductory stage of consistent fashion cycles.

Fashion and trend forecasting involves a series of activities in each of the area it is dealing with. For example it looks at the; season, target market, consumer, colors, fabrics, silhouette, texture and usage. Therefore, comprehending fashion and trend  forecast is not only crucial in determining the success of the ultimate object of the designer but also enhances the continuous repetition of sales in future seasons as well as promoting the fashion cycles.

Unlike in the past when trend forecasting was done manually, current trend forecasting is done using technological forecasting methods although they have been criticized for reducing creativity by most designers. Most trend forecasting are determined by the forecasting method applied by the ultimate user and it is therefore crucial to determine the most appropriate method of trend forecasting in any individuals business model. Generally, any trend forecasting methods involve the following steps (Hines, 2007);

The first step is Problem definition. Although this is the hardest section of forecasting, it is the most important. This step requires keen analysis of how the forecasts will be used, who needs the forecasts as well as how the forecasting technique suits within the firm needs the forecasts. A forecaster should therefore use enough time to every individual who will take part in data collection, keeping the data as well as applying the forecast for future planning. Then gathering of information follows whereby in most cases, statistical or quantitative data and qualitative data are the ones required. Therefore, the collectors of the data should be expertise who can be able to receive the qualitative information from the respondents who are usually the customers if there is no adequate quantitative information (Wong, 2010).

The third step is preliminary analysis, also called exploratory analysis. In this step, the forecaster should consider whether or not there are consistent pattern that lead to significant trend, whether or not there is evidence of business cycles, the presence of outliers in the information that need explanation as well as the extent of relationship between variables present for analysis.

The fourth step is choosing and fitting models. The best method of trend forecasting should depend on the historical data present, the application of the forecasts as well as the extent relationship between the forecasts available and explanatory variables. Some of the methods that can be arrived at includes; exponential smoothing model, ARIMA model, vector autogression, neural networks among others (Wong, 2010).

The last step involves the use and evaluation of the forecasting model. The success of the model can only be determined after the data for the forecast time has been present after which various methods are applied to assess the success of the model.

Research Methodologies

As earlier stated, the main data required in trend forecasting is qualitative, quantitative and mostly commonly, a combination of the two.

The quantitative research methodology start right from the bottom, where agencies and even the manufacturers either inquires directly from the customers on their purchasing preferences or the organization may record the consumers buying habit in a duration of a given time. The consumer’s response is recorded and used to determine preference for some specific garments, accessories or any other product on research, colors, and sizes among other factors of a product. Surveys through mail, customer response or phones are carried through publication as well as contracting market research organizations for manufacturers and as well as retailers.

The survey questions usually relate to life style, income, shopping habits as well as fashion preference. The customers who participate in these surveys are selected by the research company although they should suit with manufacturers or retailers requirements. Informal discussion with consumer enable researchers get information through asking questions to customers about what they would prefer to purchase, the types they prefer to purchase which is currently present as well as the change in products they require and are not available or they cannot reach. Most researchers use small scale retailers because of their contact and conversation with the customers.

Trend Forecasting Steps
Trend Forecasting Steps

The quantitative methodology entails the use of statistical data or information to determine the trend in customer demands and hence forecast on producing what the consumers purchase the most. Statistical data for fashion sector is easily obtainable without necessarily going to the field because it is available in manufacturers or retailers sales records (Hines, 2007).

From such records, the manufacturers can determine which garments, color of the product, size as well as the fashion preference of the consumer. After that, the manufacturer should be able to determine which fashion product should be produced more depending on sales experienced at each season of the year. It is valuable noting that a well-balanced combination of the qualitative and quantitative research methodologies is bound to boost the success of the model selected for trend forecasting.

Conclusion

This paper has attempted to show that the fashion industry has one main purpose; to offer desirable as well as appealing product to not only satisfy the customer needs, demands and aspire to have them but to also keep the product selling in the subsequent business cycles with a similar season. Every successful trend forecast must commence with the consumer through determination of the consumer’s needs to the market as well as the ability to make the consumer adjust the marketplace to his preferences and lifestyles. The paper has also expounded on the two critical methodologies used in forecast research i.e.  the qualitative and quantitative methodologies. It has also emphasized on the need to combine the two methods in order to attain the best results of the model of forecast selected.

References

Hines, T., & Bruce, M. (Eds.). (2007). Fashion marketing: contemporary issues. Routledge.

Wong, W. K., & Guo, Z. X. (2010). A hybrid intelligent model for medium-term sales forecasting in fashion retail supply chains using extreme learning machine and harmony search algorithm. International Journal of Production Economics, 128(2), 614-624.

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Dissertation BREXIT UK Construction Labour Market

Future Impact and Implication of BREXIT on the UK Construction Labour Market

Title: Future Impact and Implication of BREXIT on the UK Construction Labour Market. The construction Industry remains one of the most influential industries within the British economy. As the CBI (Confederation of British Industry) reported, for each £1 spent on construction output, a total of £2.84 in total economic activity is generated. With ambitious government plans and scheduled deadlines around the corner, it is essential for the construction industry to retain an access to the required resources.

The skills shortage remains an issue within an industry where a remedy has not been found to overcome the labour shortfall problem. The foreign workforce has been successfully used in recent years to fill the gap within the construction labour market, but the gap between the retiring workforce and the number of new entrants into the construction market remains significant. The 2016 EU Referendum resulted in a decision to leave European Union.

UK Construction Dissertation BREXIT
UK Construction Dissertation BREXIT

Although exact strategies of dealing with this decision are unknown yet uncertainty started affecting the construction industry immediately after the referendum result. At first, many foreign workers consider transferring their skills to other countries where access to the single market remains unaffected. This dissertation aims to analyse the effect of Brexit on the construction labour market and assess foreign workforce movement within the United Kingdom.

The aim of this dissertation is to analyse the current and potential future trends of foreign worker movement within the UK construction sector.

Dissertation Objectives

  • Provide a clear and precise analysis of the construction industry labour market in UK focussing on the foreign workers coming from EUA8 countries.
  • To evaluate the current tendencies within the market and make reliable assumptions towards the possible changes in trends resulting from Referendum decision.

1 – Introduction
Background
Aims and Objectives
Research Questions
Research Structure

2 – Literature Review
UK Construction – Labour Market
Foreign Workers in Construction Industry
Skills shortage and solutions
BREXIT
Effect of BREXIT on Construction Industry
BREXIT Strategies

3 – Research Methodology
Research Strategy
Quantitative Research
Qualitative Research
Primary Research
The Survey Approach
The Case Study Approach
Secondary Research
Research Ethical Practice
Limitations

4 – Data Analysis
Interviews
Interview Results
Questionnaire
Questionnaire Results
Office for National Statistics

5 – Conclusion
Research Purpose
Research Objectives
Research Limitations
Recommendations for further research

References

Appendix
Questionnaire

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Revenue Recognition Construction IAS 11

Revenue Recognition

A Summary of How Revenue is recognized within the Construction Industry under IAS 11

Title: Revenue Recognition: Construction contracts are designed to meet specifications for the negotiations on how assets are constructed or combined to meet their ultimate objectives (Buschhüter, Michael & Andreas 2011). Contract constructions may involve fixed prices where some are subjected to the cost escalation costs.

On the hand, a cost plus contract involves reimbursements or allowable and percentages of costs or the fixed rates present. The changes were made to meet the standards of Financial Accounting (IFRS 15 2014). Revenue is considered to be income earned from everyday activities as it goes by different names such as royalties, dividends, interest, fee or sales.

Revenues that are to be recognized would be from the selling goods, providing services royalties and interest. However, in this case, revenue is to be recognized from the construction of contracts. Construction contracts may be either fixed or cost plus contracts or a combination of the two (IAS 11 2011).

In this regard, a contractor needs to identify and determine what contract to use to know when to recognize revenue and costs as well. When the outcome can be properly estimated, the contract revenues and costs would be recognized as revenues and expenses respectively at the end of the contract period. A loss is also recognized as an expense by the accounting standards.

In fixed price contracts, construction contracts are estimated reliably once total contract revenues are reliable. The revenues are considered as benefits since the effects will be felt positively by any business. Stages of contract completion, as well as, the contract costs have been reliable to meet the standards. All contract costs are to be measured reliably to account for the actual contract costs that would be incurred when compared.

Similarly, for cost plus contract to be enforceable, the economic benefits of the contract have to be passed to the entity. The costs have to be also clearly and easily identified for measurements to be done reliably (IFRS 15 2014). The recognized revenue at the end of a contract is considered to be the percentage of completion. This whereby the contract revenues are matched with the contract costs and then reported in the books of account.

Revenue Recognition
Revenue Recognition

Afterward, the contract revenues and costs are recognized as revenues costs in the profit and loss account. The expected excess of costs over revenues is treated as expenses. If the outcomes are not measured reliably, the revenues will not be recognized and perhaps not even recoverable in the business. An entity will then disclose the revenues recognized during the accounting period as techniques of arriving at the revenues will be recognized as well.

A Description of the Process of Developing New Standards IFRS 15

The International Financial Reporting Standard had to be formed by the Internal Accounting Standards Board; IASB to provide rules and procedures on how to account for revenues that are from customers. There were significant differences between IASB and the IFRS when it came to the definitions of revenue.

Even though they were almost similar, the different understanding of revenue resulted in different ways of treating revenue in financial accounting. The IASB thought they had not given enough revenue standards, policies and procedures on how revenue was treated (IAS 18 1993).

The IASB began working on the issues to try and formulate ways it could solve the issue from 2002.Their first review paper was released in 2008 as they further discussed it and gathered information from relevant sources. Afterward, a release on the exposure draft was done proposing the new accounting standards in 2010 and 2011. After a long process of deliberations and reviews that took several years, the IASB issued the final standard on 28th May 2014.

Changes made about the IAS 18 included recognizing and measuring financial tools revised in 2003 and the 2004 revision of insurance contracts. In 2007, the presentation of financial statements was reviewed through amendments in the different terms used. Their first issued review in 2008, involved investment costs in jointly controlled entities and subsidiaries as well as improvements on the IFRS. The same year also saw IFRIC agreements on issues relating to the constructions of the real estate.

The IFRIC 15 also dealt with issues of the non-monetary contributions by investors in entities that are jointly controlled as they evaluated all legalities in leasing or substance transactions. Barter trade and service concession agreements were also made as they issued customer loyalty programs in 2007 (IAS 18 1993). The IFRS 15 model follows procedures that begin with the; identification of the contracts as well as all individual parties involved.

Transaction prices are also determined as the prices are allocated to the different obligations in accounting. Revenues are finally recognized as the performance obligations are fulfilled. The amount of revenue to recognize and when acquiring costs are capitalized as assets are under the guidelines of the IFRS 15. Any of the expenses not capitalized as assets are considered to be expenses incurred. After all proper recognitions are reporting is done, financials are to be properly disclosed by the company.

Why the Process of Developing New Standards has proven to be difficult and Time-consuming

The new revenue recognition standards had left out key areas that bring in revenue and had not been recognized. New standards on how to recognize revenue had to be set for businesses to follow by the relevant bodies. The objective of the new set of rules and procedures is to explain how the different revenues would be treated.

Revenue recognition is recognized when it estimated to bring economic benefits that are measurable to the business in the future. Therefore, practical guidance is given on how the criteria will be met. The International Accounting Standards Board adopted previously issued the construction contracts and the new standards of recognizing revenue.

IAS 18 was put in place to replace the former methods of recognizing revenue while the IAS 11 replaced some accounting rules on the construction of contacts (Buschhüter, Michael & Andreas 2011). This is to help in knowing how to treat costs and revenues that are associated with the nature of activities undertaken.

Also, due to the then existing rules, changing to new standards had to take long processes of deliberations that were time-consuming. Steps had to be followed as described above as company’s found it hard to easily and quickly adapt to the new set of rules. The new set rules had to be then applied first to see if they would meet the specifications with no interference of other accounts that would result in imbalances in the financial statement and misappropriation and misallocation of resources.

Changing one side would have to result in changing of the other side to cancel out the effects. For instance, in ledger accounts, a debit entry has to be followed a credit entry and vice versa is also true.

What people do not know is that different firms have different accounting rules they follow. A majority however, follow the international standards while others follow the U.S. GAAP principles (Kieso, Jerry & Terry 2010). Unlike the U.S. GAAP, the International Financial Reporting Standards does not always give extensive regulation prompting the need of having some exercises in judgments in some instances. The U.S. GAAP accounting is based on standards while the IFRS focuses more on principles.

The accounting differences have made the financial comparison between different organizations difficult. For instance, actuarial gains and losses are treated differently. They are treated as off-balance sheet items by the IFRS standards unlike under the U.S GAAP.

The off-balances in the balance sheets would cause volatilities and fluctuations. Therefore, the IASB is trying as much as it can to harmonize the differences in the standards. This would also take time as the harmonization would require changes in almost every aspect of accounting (IASB 2006). Adaptation by firms would take time as well making it a difficult and a long, tedious process.

A Summary of how the New Standard IFRS 15 would Deal with a Construction Contract where Construction Happened Over One Accounting Period

The important principle of IFRS is that a company would have to recognize revenue for it to be related to the transfer of the commodities and services that were promised and what the company is expected to get. Services rendered depend on the agreement of the specific time it should cover. The period might exceed one accounting period as would be expected.

An accounting period is often considered to take one year. This, therefore, means that more than one accounting period takes more than one year. The work done at construction contracts usually take more than one accounting period. Therefore, rules have to be set that best suit the situation. One of the methods is to recognized revenues or profit at the end of the contract. This would be through following the IAS 18 – Revenue (IAS 18 1993).

Revenue Recognition and Profit

Recognizing profit at the end of the period does not show that profit was accrued. Under the IAS 11 all revenues and costs will be matched to the accounting period and documented at the end of each financial period (IAS 11 2011). Recognition of profit at the end of the contract would see the company reporting spikes or rises in profits that may not often be matched with the accruals. This is because the revenues would have accumulated to amounts exceeding what would have been recognized in one accounting period (Ursachi, Antonela, & Geanina 2014).

In this regard, revenues and costs are only recognized once estimations of the outcome are reliable. As stated earlier, properly estimated outcomes from contracts should be reliable for use and interpretation. An expected contract loss should be recognized immediately. The completion stage would be calculated on the basis of sales, costs, and physical proportions.

Revenue recognition done at the end of the construction contracts is known as the percentage of completion method. The reported revenue and costs would later be credited to the proportion of work that was completed (IAS 11 2011). The contract revenue is recognized as revenues while the contract costs as expenses in the profit and loss accounts. Similar to when accounting was done in one accounting period, expected amount that exceeds when contract costs are more than contract revenues are treated as expenses.

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Reference List

Buschhüter, M & Andreas S 2011, ‘IAS 11–Revenue Recognition & Construction Contracts’, Kommentar Internationale Rechnungslegung IFRS. Gabler, 374-391.

International Accounting Standards Board Revenue Recognition: (IASB) 2006, ‘International Financial Reporting Standards (IFRS’s): Including International Accounting Standards (IAS’s) and Interpretations’, International Accounting Standards Board.

International Accounting Standards Committee 2010, Revenue Recognition – ‘IAS 18’ Revenue, London: IASC 1993.

Kieso, E, Jerry W, & Terry W 2010, Intermediate accounting – Revenue Recognition: IFRS edition. Vol. 1. John Wiley & Sons.

Ursachi, Antonela, & Geanina M 2014, ‘IFRS 15–revenue from contracts with customers – Revenue Recognition,’ 2nd International Conference-2014.

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Dissertation Bank Profitability South Africa

Determinants of Bank Profitability in South Africa

Dissertation Title: Determinants of Bank Profitability in South Africa. The prime rationale for conducting the research is to find the factors that affect the bank’s profitability in the South African region so that appropriate measures can be taken to improve the financial performance. This research provides empirical evidence based on the analysis of the bank’s real financial data in support of the determinants of the bank’s profitability. Thus, this research is considered to be useful in enhancing the knowledge of the bank professionals, as well as the students pursuing higher studies in finance and banking.

The banking sector has been blamed the most for the financial crisis that happened in the recent past. Therefore, it has been perceived to be very important to research and find the factors that affect the bank’s profitability so that the situation could be controlled in the cases of the financial crisis. In this context, this research explores the relationship of the factors such as liquidity, management efficiency, capital adequacy, the scale of operations, productivity of assets, growth in gross domestic product, and inflation with the return on equity.

Bank Profitability Dissertation
Bank Profitability Dissertation

The primary aim of this dissertation is to explore the determinants of bank’s profitability in the South African region. For this purpose, the research is aimed to find the crucial factors that affect the bank’s profitability in the South African region. Further, in this regards, the degree of influence of the factors on the bank’s profitability has also been evaluated in this dissertation. With regards to the research aim, the following objectives have been developed, which are to be addressed in this research:

  • To review, research, and understand the regulatory framework prevailing in the South African region
  • To study the bank system in South Africa through developed models and evaluate the factors, which contribute to the bank’s profitability
  • To explore the determinants of bank’s profitability in the South African region

Dissertation Contents

Introduction
Background of the Research
Rationale for Doing the Research
Aim and Objectives
Research Question
Significance of the Research
Organisation of the Research

Literature Review
Bank Specific Factors Affecting the Profitability
Size of the Bank
Capital
Credit Risk Management
Product and Service Portfolio
Efficient Management Team
Liquidity Management
Industry or Sector Specific Factors
Banking Regulation in South Africa
Gross Domestic Product
Inflation
Prime Lending Rates
Taxation and Foreign Trade

Topic Description

Research Methodology
Research Question
Research Approach
Research Design
Data Collection Method
Selection and Justification
Sample Size and Sampling Strategy
Data Analysis Process and Tools
Ethical Considerations
Limitations of the Research

Data Analysis
Analysis of the CAMEL Ratios
Liquidity
Capital Adequacy
Efficiency
Non-Performing Loans
Net Interest Margin
Productive Asset Ratio
Size Ratio
Advance and Loans to Deposit Ratio
Analysis of the Gross Domestic Product
Analysis of the Inflation

Discussion

Conclusion
Brief Summary
Conclusion
Recommendations

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Mixed Method Research Design

The Mixed Method in Research Design

The mixed method approach to evaluating research data may be applicable to studies that are designed to gather both qualitative and quantitative information. This technique is often used in disciplines such as psychology, sociology or certain types of medicine. The continued development of these fields may depend on data that is derived from standardized scales or rating systems in addition to that gleaned from interviews, ‘focus group’ sessions and other similar tools. Therefore, the mixed method may be appropriate in a new project on a complex issue or situation that generates complex and highly individualized answers to research questions. Examples of these may include the societal impact of homelessness or the treatment of a lost or diminished sense. The data here may need to cover detailed and varied feedback (or ‘self-reports’) on the effect(s) of these target variables, as well as scores from formal quantitative tools typically used within the research community in question. One data type does not give a complete ‘picture’ of the outcome(s) without the other. Therefore, a methodology that incorporates both to analyse the data set as a whole is necessary.

The mixed method may combine and synthesize this data through a process called triangulation. This may involve the conversion of qualitative data into quantitative data. Such a form of triangulation is most applicable to data resulting from the administration of structured interviews or surveys, provided that data is sufficiently standard or homogeneous across respondents to be coded or scored effectively (i.e. without bias or other forms or statistical inadequacy). In this way, it may be converted to quantitative data, and compared or analysed in accordance with the requirements of the study design (e.g. subjected to a form of analysis such as a paired t-test). On the other hand, the qualitative data may be too individualized and/or complex to be coded. In this case, a thematic analytical technique may be used, incorporating findings such as significant differences among the quantitative data points as a theme or concept.

Mixed Method Research Design
Mixed Method Research Design

The aim of triangulation is the full integration of both data types to generate contiguous concepts or conclusions. This leads to another advantage of the mixed method: i.e. that it can address research aims that do not stem from standard null hypotheses. Questions, in other words, along the lines of ‘Does this novel treatment result in an improvement in the life quality of patients with hearing loss?’ rather than statements such as ‘This treatment improves hearing loss [in comparison to an existing alternative]’ to be confirmed or denied.

The mixed method is not, however, without disadvantages or detractors. Critics of this methodology often cite the risk of the ‘incompatibility paradox’; the probability that one data type will be inadequately analysed compared to the other. A prominent example of this risk is known as ‘pragmatism’, or the perception that researchers who use the mixed method value ‘experiential data’ (i.e. self-reports recorded from respondents) at the expense of quantitative data. The use of the mixed method may also be subject to preconceptions, judgement or other forms of observer bias that a researcher may impose on qualitative data in the course of its collection. These risks can be ameliorated, mainly through the skill and training of the individual researcher. Under these conditions, the mixed-method technique can be applied to generating full, comprehensive conclusions for non-standard research questions.

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References

Brown RA, Kennedy DP, Tucker JS, Golinelli D, Wenzel SL. Monogamy on the Street: A Mixed Methods Study of Homeless Men. Journal of Mixed Methods Research. 2013;7(4):328-346

Windsor LC. Using Concept Mapping in Community-Based Participatory Research A Mixed Methods Approach. Journal of mixed methods research. 2013;7(3):274-293

Robson C. Real World Research. 2 ed. Oxford: Blackwell; 2002

Mertens DM, Hesse-Biber S. Triangulation and Mixed Methods Research: Provocative Positions. Journal of Mixed Methods Research. 2012;6(2):75-79

Lieber E, Weisner TS. Meeting the practical challenges of mixed methods research. SAGE handbook of mixed methods in social and behavioral research. 2010;2:559-579

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