paedophilia in the church essays

paedophilia in the church essays Paedophilia has risen to epidemic proportions in Australia. Although there is no hard empirical evidence, the enormous surge of recent attention on the abuse of children by priests suggests that there is an even bigger endemic in the Australian church. The psychological damage to victims of child sexual assault are great. Psychological disorders in victims are common including sexual disorders, bipolar disorder, manic depression and depression; distressing conditions which may ultimately lead to suicide. Victims also may become perpetrators and continue the cycle. (Morrison, 1995; Johnson, 1988, Tomeo et al, 2001, Widom, 1995; Bickley and Beech, 2001). Thus, the question of how any such criminal, morally reprehensible and pathological acts as paedophilia can find a place in the lives of men so trusted, well-educated, committed to a life of good works and presumably guided by God is an important one and one of which has been the subject of much debate. This question has given rise to many theories which come under two main headings - features of the church that attract paedophiles to the priesthood and features of the church that are moulding or creating paedophiles. The first includes: the accessibility of children and acquisition of trust, disguise offered through priesthood, endowment of power to priests, the tradition of secrecy, celibacy and repentance. The second includes: Celibacy, power and narcissism and seminary school studies, Each will be discussed individually followed by a more detailed discussion of the most highly controversial argument concerning the contribution of homosexuality in the church to the paedophile crisis. It is believed by some that there is a disproportionate number - on the high side, of homosexuals in the church and this is the root of the paedophile crisis. Obviously there are many more factors that may be involved however only the main factors are covered. The validity of each theory wi.. .

Definition and Examples of Antithesis in Rhetoric

Definition and Examples of Antithesis in Rhetoric Antithesis is a  rhetorical term for the juxtaposition of contrasting ideas in balanced phrases or clauses. Plural: antitheses. Adjective: antithetical. In grammatical terms, antithetical statements are parallel structures.   A perfectly formed antithesis, says Jeanne Fahnestock, combines isocolon, parison, and perhaps, in an inflected language, even homoeoteleuton; it is an overdetermined figure. The aural patterning of the antithesis, its tightness and predictability, are critical to appreciating how the syntax of the figure can be used to force semantic opposites (Rhetorical Figures in Science, 1999). Etymology From the Greek, opposition Examples and Observations Love is an ideal thing, marriage a real thing.(Goethe)Everybody doesnt like something, but nobody doesnt like Sara Lee.(advertising slogan)There are so many things that we wish we had done yesterday, so few that we feel like doing today.(Mignon McLaughlin, The Complete Neurotics Notebook. Castle Books, 1981)We notice things that dont work. We dont notice things that do. We notice computers, we dont notice pennies. We notice e-book readers, we dont notice books.(Douglas Adams, The Salmon of Doubt: Hitchhiking the Galaxy One Last Time. Macmillan, 2002)Hillary has soldiered on, damned if she does, damned if she doesnt, like most powerful women, expected to be tough as nails and warm as toast at the same time.(Anna Quindlen, Say Goodbye to the Virago. Newsweek, June 16, 2003)It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way.(Charles Dickens, A Tale of Two Cities, 1859) Tonight you voted for action, not politics as usual. You elected us to focus on your jobs, not ours.(President Barack Obama, election night victory speech, November 7, 2012)Youre easy on the eyesHard on the heart.(Terri Clark)We must learn to live together as brothers or perish together as fools.(Martin Luther King, Jr., speech at St. Louis, 1964)The world will little note, nor long remember what we say here, but it can never forget what they did here.(Abraham Lincoln, The Gettysburg Address, 1863)All the joy the world containsHas come through wishing happiness for others.All the misery the world containsHas come through wanting pleasure for oneself.(Shantideva)The more acute the experience, the less articulate its expression.(Harold Pinter, Writing for the Theatre, 1962)And let my liver rather heat with wineThan my heart cool with mortifying groans.(Gratiano in The Merchant of Venice by William Shakespeare)Jack Londons CredoI would rather be ashes than dust! I would rather that my s park should burn out in a brilliant blaze than it should be stifled by dryrot. I would rather be a superb meteor, every atom of me in magnificent glow, than a sleepy and permanent planet. The proper function of man is to live, not to exist. I shall not waste my days in trying to prolong them. I shall use my time.(Jack London, quoted by his literary executor, Irving Shepard, in an introduction to a 1956 collection of Londons stories) Antithesis and AntithetonAntithesis is the grammatical form of antitheton. Antitheton deals with contrasting thoughts or proofs in an argument; Antithesis deals with contrasting words or ideas within a phrase, sentence, or paragraph.(Gregory T. Howard, Dictionary of Rhetorical Terms. Xlibris, 2010)Antithesis and AntonymsAntithesis as a figure of speech exploits the existence of many natural opposites in the vocabularies of all languages. Small children filling in workbooks and adolescents studying for the antonyms section of the SAT learn to match words to their opposites and so absorb much vocabulary as pairs of opposed terms, connecting up to down and bitter to sweet, pusillanimous to courageous and ephemeral to everlasting. Calling these antonyms natural simply means that pairs of words can have wide currency as opposites among users of a language outside any particular context of use. Word association tests give ample evidence of the consistent linking of opposites in verbal memo ry when subjects given one of a pair of antonyms most often respond with the other, hot triggering cold or long retrieving short (Miller 1991, 196). An antithesis as a figure of speech at the sentence level builds on these powerful natural pairs, the use of one in the first half of the figure creating the expectation of its verbal partner in the second half.(Jeanne Fahnestock, Rhetorical Figures in Science. Oxford University Press, 1999) Antithesis in Films- Since . . . the quality of a scene or image is more vividly shown when set beside its opposite, it is not surprising to find antithesis in film . . .. There is a cut in Barry Lyndon (Stanley Kubrick) from the yellow flickers of a flaming house to a still gray courtyard, lined with soldiers, and another from the yellow candles and warm browns of a gambling room to the cool grays of a terrace by moonlight and the Countess of Lyndon in white.(N. Roy Clifton, The Figure in Film. Associated University Presses, 1983)It is clear that in every simile there is present both differences and likenesses, and both are a part of its effect. By ignoring differences, we find a simile and may perhaps find an antithesis in the same event, by ignoring likeness. . . .- In The Lady Eve (Preston Sturges), a passenger boards a liner by tender. This was conveyed by the two vessels whistling. We see a convulsive spurt of water and hear a desperate, soundless puff before the siren of the t ender found its voice. There was a stuttering amazement, a drunken incoordination to these elaborate preliminaries, foiled by the liners lofty unruffled burst of sounding steam. Here things that are like, in place, in sound, and in function, are unexpectedly contrasted. The commentary lies in the differences and gains force from the likeness.(N. Roy Clifton, The Figure in Film. Associated University Presses, 1983) Antithetical Observations of Oscar Wilde- â€Å"When we are happy, we are always good, but when we are good, we are not always happy.†(The Picture of Dorian Gray, 1891)- â€Å"We teach people how to remember, we never teach them how to grow.†(The Critic as Artist, 1991)- â€Å"Wherever there is a man who exercises authority, there is a man who resists authority.†(The Soul of Man Under Socialism, 1891)- â€Å"Society often forgives the criminal; it never forgives the dreamer.†(The Critic as Artist, 1991) Pronunciation: an-TITH-uh-sis

Cell phones and how they have changed us socially Research Paper

Cell phones and how they have changed us socially - Research Paper Example The 20th century witnessed an explosion of technological growth. Telephone technology dates back to the late 19th century through the inventions of Alexander Graham Bell and the subsequent Bell Telephone Company. Still, it wasn’t until the 20th century through American Telephone and Telegraph (AT&T) that the Western world experienced the profound impacts of this technology, and not until the late end of this century that cell phones would come to dominate the social landscape. Indeed, between 1990 and 1998 cell phone subscribers increased from 11 million to 312 million (Stevens 2010). Along with the Internet, cell phones would come to profoundly impact the way humans interact and function in the contemporary world. This essay examines the way cell phones have changed us socially. The most prevalent impact of cell phones on social life has been in the very fabric of humanity’s daily existence. Within this context of understanding it’s demonstrated that individuals have gained considerable social freedom from the implementation of cell phone technology. Hindel (2008) argues that cell phones and this corresponding freedom have resulted in advancements in time management and efficiency that have profoundly altered the modern world. Today people are more independent and confident – considering having a cell phone on a long drive – in navigating the modern social landscape. Still, individuals such as Davis (2010) argue that the infusion of cell phone technology has had a negative impact on human social relations. This perspective contends that cell phones have resulted in a generation of people who have learned to communicate primarily through the mediation of these devices. This has resulted in a populace that is unable to deal with so cial problems on a face-to-face level. Individuals also argue that such changes have resulted in decreased ethical responsibility. With the high

REFLECT THOUGHT Assignment Example | Topics and Well Written Essays - 500 words

REFLECT THOUGHT - Assignment Example The main difference in these regards is the understanding that in these regions, strength is a more valued quality than intelligence, as the majority of work is farm or manual labor. It’s clear that this difference could lead to relativism as one culture places higher value than another on intellectual forms of intelligence. Even as difference value is placed on these elements, it’s clear that the different values are different because they have specific viability in the culture, leading to support of relativism. 2. Psychological egoism claims that whatever we do, we do out of self-interest. Give an example of an act you think is not done out of self-interest, and explain how the psychological egoist might try to interpret that act as selfish. One of the major acts that are claimed to be done not out of self-interest is charity work. Everyone from celebrities to billionaires to everyday citizens has regularly involved themselves in charitable activity as a means of contributing to world culture and helping disenfranchised individuals. Even as these acts are performed out of charity, a psychological egoist may claim they are done out of self-interest. The egoist could potentially argue that in performing these acts the people are not doing it out of a selfless interest to help others, but actually as a means of making themselves feel better. Similarly, the egoist might argue that these people are participating in these charitable activities to make themselves look better in the eyes of their peers and the general public. The problem of prayer in school is a hot-button issue. In the hypothetical dilemma John wants prayer, while Mary does not. One of the potential compromises that could be reached for this situation is to allow prayer in school for those individuals that choose to pray. Still, prayer must not be an institutionally sponsored activity; for instance, teachers would not be able to institute prayer sessions. This scenario

What Is Meant By the Term Postmodernism Essay Example | Topics and Well Written Essays - 1500 words

What Is Meant By the Term Postmodernism - Essay Example The essay "What Is Meant By the Term Postmodernism" discovers postmodernism. Debates about postmodernism began in around 1979 with Jean- Franà §ois Lyotard article â€Å"The Postmodern Condition.† In this essence, the work analyzes The Simpsons. The work borrows from the perspectives Lyotard’s views about postmodernism. The Simpsons series is a vivacious television program produced by Matt Groening. The series depicts postmodernism through the sarcastic illustration of the lifestyle Simpson Family, a middle-class household in America. Simpson is a perfect indication of postmodernism. It explains the frolics of a dysfunctional family. The father figure of the family is a drunkard while the wife is a hard working person. Their ten-year-old child, Bart is an underachiever who is proud of his status. Lisa is a genius girl but feels unappreciated while the last-born is an introvert but loving. The contrasting characters in the series present the dilemmas of postmodernism fa milies. The authoritative series illustrates cultural and political concerns of a postmodern family. Notably, it shows the reversed gender roles common with postmodernism structures. Simpsons casting has a cumulative influence on culture.The reversed roles in the families usurp common traditions hence, explaining the concept of grand narratives. The Simpsons has fundamentals of a great narrative postmodernism. Watching the episodes takes the audience through an experience in which philosophy of the principal regime dominates on knowledge.

Cash Flow and Profitability of Dividend Payout

Cash Flow and Profitability of Dividend Payout CHAPTER 1: INTRODUCTION Overview The issue of dividend has been studied comprehensively in last few decades. Still it remained as one of the most debatable issue in the field of Finance. The contradictory nature and massive importance 0f dividend in finance had made it one of the most discussable topics for researchers. Researchers in the past enclosed many aspects of dividend; few among them are views about dividend, dividend payment effects on firm value, dynamics and determinants of dividend policy, and dividend movement of different markets. Lintner (1956) study the allocation of income of corporations among dividends, retained earnings and taxes by taking data from the years 1918 to 1941 as a training period and data from the years 1942 to 1951 as the testing period. Researchconcluded that the basic origin of dividend changes werenet earning and preceding year dividends. In addition, firms attempt to continue a constant stream of dividend and influence to make a regularly partial adjustment to a target payout ratio relatively hysterically changing their payout when a change in income occurs. In the short run, dividends are consistent to avoid frequent changes. This dispute is rooted back to the significant effort of Miller and Modigliani (1961), in which it was challenged in a perfect market condition dividend policy did not affect the value of firm. In contrast, Lintner (1962) and Gordon (1963) based à ¢Ã¢â€š ¬Ã…“Bird-in-handà ¢Ã¢â€š ¬? theory and argued that in the world of ambiguity and imperfect information, hig h dividend payment is linked with high firm value. In addition, Black (1976) called dividend as great puzzle which need extensive researched. Furthermore, the Brealey and Myers (2005) listed dividend as one of the top ten significantvague topic in advance corporate finance. According to Anil and Sujjata(2008) emerging consensus was that no individual factor alone can describe dividend behavior. The existing corporate theories supported that cash flow and profitability have significant impact on dividend. The aim of this study was to know the impact of cash flow and profitability on dividend payout of non financial firms in Pakistan market. This study considered free cash flow and profitability was most important for non financial firm in Pakistan market. Talat and Mirza(2010) conducted research related to ownership structure and cash flow as predictor of dividend payout policy. According to that personal ownership, cash flow delicacy, size, and leverage were negatively associated with dividend payout policy. In contrast, profitability and operating cash flow was found as determinants of cash dividend. In addition, Researcher concluded that executive ownership, personal ownership, operating cash flow, and size were important determinants of dividend while, leverage and cash flow delicacy did not contribute considerably in determining the level of corporate dividend payment. DeAngelo and DeAngelo (1990) found significant relation between cash flow and dividend changes. Problem Statement In the field of corporate finance, the dividend was considered as one of the most noteworthy issues. The main purpose to study the impact of cash flow and profitability on dividend payout of non financial firm in Pakistani market was to analyze the cash dividend behavior of developing countries firm. In addition, study was conducted to find out how strongly these two variables free cash flow and profitability have impact on the dividend payout because, profitability was most likely used as determinants of dividend payout in most of the previous researches but free cash flow was not taken too much in previous research. Furthermore, how these two variables serve as an indicator for dividend payout. Hypothesis This research study has tested the following hypothesis to fulfill the objective of the research. H1: There is significant impact of free cash flow on dividend payout. H2: There is significant impact of return on assets on dividend payout. H3: There is significant impact of return on equity on dividend payout. H4: There is significant impact of earning per share on dividend payout. H5: There is significant impact of net profit margin on dividend payout. Outline of the Study The research structured follows. Chapter one was consist on the introduction of the thesis, it is essential to review the views and theoretical background of dividend, the statement o problem, scope and objective, hypothesis. Chapter two consisted of literature review given by various authors, theories on dividend and impact of cash flow and profitability on dividend payout. Chapter three explained methodology, it consisted of explanation of the selection of the variables, the sampling and research design, the data technique and hypothesis. Chapter four represents the analysis of results after processing the data. Chapter five composed of final result, conclusion and recommendation. Chapter six consisted of references. CHAPTER 2: LITERATURE REVIEW Since 1956, dividend has always considered one of the most interested and investigated topic in world of finance.Lintner (1956) analyzed the allocation of earning of corporation among dividends, retained earnings, and taxes by taken data into consideration for years 1918 to 1941. It was found the basic determinants of dividend change are net earning and preceding year dividends. In addition, firms tried to continue a stable flow of dividend and likely made a regularly limited adjustment to a target payout ratio instead radically changing payout when earning changed. Jensen and Meckling (1976) paid attention toward agency cost hypothesis and described that dividend restricted the funds under management control, as a result putting them under strict capital market examination. Owner responsibility was reduced to deal with the quality of investment and to handle the expenditure on manager prerequisites. Marke, Langrehr, and Hexter(1998) conducted research on dividend policy determinants. Researchers had taken focus of firm, natural log of sales of firm, inside ownership for firm, no of common shareholder for firm, free cash flow for firm, sales growth of firm, and standard deviation of returns o f firm as determinants of dividend policy. Authors concluded that corporate focus has negative impact on dividend payout. While inside ownership had also negative impact, according to researcher the firms have greater inside ownership have small dividend payout. In addition, the firms with higher free cash flow have higher dividend payout and lower payout ratio of firms with higher standard deviation of returns. William and Nanda (1994) conducted research on free cash flow, shareholder value, and the unallocated profits after tax of 1936 and 1937. In this study researcher tried to explore the investor reaction toward the anticipated decrease in free cash flow presented to corporate managers. In addition, researchers suggested agency costs as partial determinants of dividend policy. To avoid the agency problem corporate have to pay higher dividend and imposed higher tax on undistributed profit so the problem of agency cost handled efficiently. The study conducted on determinants of dividend payout ratio in GhannabyAmidu and Abor (2006). In this study 20 listed firms of Ghana Stock Exchange were used as a sample which shows 76% of the total listed firm in Ghana Stock Exchange. Researchers have taken the Payout Ratio as controlled variable and explanatory variables includes risk, profitability, cash flow, corporate tax, institutional holding, sales growth, and market to book value. It was foundthat more profitable firms paid more dividends and profitability is positively related to dividend payout. In addition, cash flow and taxes are also positively related to dividend payout. Further, they also concluded there is a positive relationship between increase in liquidity and dividend payout. Results suggested negative relationship of dividend payout with growth, market to book value, risk, and institutional holding. The firms with the earning instability found hard to pay low and no dividends. Al-Malkawi (2007) worked on determinants of corporate dividend payout policy in Jordan. Researcher used a firm level panel data of all publicly traded firms on the Amman Stock Exchange for the year 1989-2000. Researcher used dividend payout as a depended variable and agency cost, Ownership, annual share turnover, market to book ratio, market capitalization of common equity, financial leverage ratio, profitability ratio, and taxes as independent variables. By using Tobit specification researcher concluded that positive relationship between size, age, and profitability with dividend payout and negative relationship between signaling device, ownership, and taxes in Jordan. Fairchild (2010) worked on Dividend policy, signaling and free cash flow: an integrated approach. Researcher has tried to examine the dividend policy by taking only two hypothesis signaling and free cash flow. In order to understand the composite environment of dividend policy, signaling game is developed in which most of the information possesses by managers than investors about the quality of the firms. The signaling hypothesis shows that asymmetric information between managers and investor, dividend work as signal regarding current performance and future prospect. The study found that high dividend has positive effect on the firm performance, in term of providing a positive signal for current performance and as will as future scenario. In addition, dividend payout reduces the free cash flow problem, which may attract the manager to invest in negative NPV project for personal interest. But if the project shows positive NPV so investment opportunities are available which lead toward the higher dividend in future. Gill, Nahum, and Rajendra (2010) worked on determinants of dividend payout ratio in United States. In this study researcher extend the Amidu and Joshua, and Anil and Kapoor finding for the American service and manufacturing firms. Researcher took same variables into account such as profitability, tax, market to book value, cash flow, and sale growth. The sample size was 266 out of 500 financial reports. According to the researcher dividend payout ratio of manufacturing firms is the function of profit margin, tax, and market to book value ratio. It was also found that result differ when the dividend payout ratio was defined as the ratio between after tax cash flow and cash dividend, not considering after tax earning of the companies. Reddy (2006), studied the dividend behavior of Indian companies, movement, and determinants and struggled to decide the behavior of the companies listed at Bombay Stock Exchange with theassist of trade off theory and signaling theory hypothesis. According to researcher analysis of dividend trend depicted that stock traded on New York Stock Exchange and Bombay Stock Exchange indicated that percentage of companies paying dividend has declined from 60.5% in 1990 to 32.1% in 2001 and there is only few companies paying dividend constantly. Beside that firms paying dividend are more profitable, large in size, and having enough growth. Indian context did not represent corporate tax and ax preference theory. Lastly the dividend change indicated signal to current and lagged earning performance rather than future earning performance. Baker, Farrelly and Edelman (1986) studied New York Stock Exchange 318 firms. According to the researchers main determinants of dividend payments were expected future earning and picture of past dividend. Gitman and Pruitt (1991) asked 1000 largest US firms financial managers and concluded present and precedent year earning were significant determinants effect dividend payment. According to Baker and Powell (2000) survey companies listed on New York Stock Exchange were industry explicit and predicted level of future income was the main factor of dividend payout Anil and Kapoor (2008) studies Indian information technology sector for determinants of dividend payout ratio. The phase for study 2000-2006 encompass both recessionary and booming phase of Indian information technology sector. Researcher concluded that beta and liquidity was discovered a notable determinant of dividend payout ratio. In addition, authors concluded that due to recession from 2003 onwards IT sector observed exponential growth, and it was anticipated linear growth in IT sector after 2006. Recently in Pakistani perspective, Ahmed and Attiya (2009) investigated sample of 320 non-financial firms listed on Karachi Stock Exchange from 2001 to2006.Researchers concluded Pakistani companies dependent more on current earning than past dividend. In addition, authors highlighted few predictors that may affect payout policies. Firstly, the finding demonstrated companies containing high profit with consistent earning can manage larger amount of free cash flow as a result to payout larger dividend. The firms having larger investment chance can easily affect and have a significant role in determinants of dividend payout policy in Pakistan. The companies paid more dividends to shareholders where inside ownership exist. Ownership structure has considered major factor in determining dividend policy in Pakistan. Beside that dividend payout was not affected pay growth of the firms and market liquidity has a significant impact on dividend payout. Furthermore, size was significant determin ants for dividend payout that means companies invest in assets relatively paying dividends to its stockholders. 2.1 Dividend irrelevance theory: Miller and Modigliani (1961) proposed that dividend policy is irrelevant to the shareholder and stockholder wealth was constant in the world of perfect market condition and any growth in the current payout is financed by literally priced stock sales. The basic assumption was that management paid 100 percent payout in every period. Other assumptions were as follow. First, market is perfect capital market that means there were no taxes on transaction cost, single buyer and seller not influenced price and everyone have free access to information. Second, investors are rational and value of securities was based on the discounted future cash flow to investor. Third, manager act as a agent of shareholders, and there was no uncertainty about the investment policy of the firm. 2.2 Bird-in-hand theory: Al-Malkawi (2007) emphasized that dividend valued differently from retained earnings (capital gains) in world of ambiguity and irregularity information. à ¢Ã¢â€š ¬Ã…“A bird in hand (dividend) is valued more than two in the bush (capital gain)à ¢Ã¢â€š ¬?. Investors always preferred dividends to retained earnings due to uncertainty of future cash flow. Although, this controversy has been extensively condemned and has not get strong empirical base, but, it was supported by Gordon and Shapiro (1956), Lintner (1962), and Walter (1963). The basic assumptions were as followed Firstly, investors have inadequate information regarding the profitability of a firm. Secondly, cash dividend was taxed at a higher rate when capital gain was realized on the sale of share. Thirdly, dividend serves as a signal of expected cash flow. 2.3 Agency cost and free cash flow theory: Ross (2008) define agency cost is the cost of the conflict of interest that exists among shareholders and management. It was happened when management act for own interest rather than shareholders interest who own the firm. This could be direct and indirect. It was in contrast to assumption of Millar and Modigliani (1961) that mangers act as an agent of shareholders. This is somewhat dubious, as the owners of the firm are different from the management. Managers are bound to carry out some activities, which could be costly to shareholders, such as undertaking unprofitable investments that would yield excessive returns to them, and unnecessarily high management compensation (Al-Malkawi, 2007). These costs are borne by shareholders; therefore, shareholders of firms with excess free cash flow would require high dividend payments instead. Agency cost may also arise between shareholders and bondholders: while shareholders require more dividends, bondholders require fewer dividends than shar eholders by putting in place a debt covenant to ensure availability of cash for their debt repayment. Easterbrook (1984) also identified two agency costs: the cost of monitoring managers and the cost of risk reluctance on the part of managers. Jensens free cash flow/overinvestment hypothesis (1988) provides a surrogate description for the positive association between the direction of the dividend change and the stock price reaction. Jensen argues that managers tend to hold cash to invest in negative NPV projects for their own utility maximization. The agency costs that result from this overinvestment decrease the value of the firm. Like the signaling hypothesis, the FCF argument suggests there should be a positive relationship is the direction of the dividend policy change and the stock price reaction. However, the FCF argument differentiates itself with respect to the level of growth opportunities faced by the firm. If a firm initiated a cash dividend, FCF arguments postulate there are fewer funds available for costly overinvestment. Likewise, if company didnt pay dividend, the strongest form of a decrease would reduce the value of the firm because there are more funds available to invest in less present value projects. The FCF hypothesis assumes larger stock price volatility for the firms who have few growth opportunities as compared to the firms with many growth opportunities. There is disagreement between different researchers on dividend policy. Allen and Rachim (1996) in Australia found no significant association between stock price volatility and divided policy. According to Gordon (1963) the stock price volatility is influenced by dividend payout. The firms who pay large dividend have minimum risks in terms of stock price value. Some of hypothetical mechanism also suggests the universal relationship of dividend yield and dividend payout ratio with stock price volatility. Jensens and Meckling (1976) developed Agency cost argument which proposed that dividend payout lower the cost of funds and increase the cash flows for the company. The company after paying cash dividends to stock holders would have less cash in hands of the managers to invest at below the cost of capital. According to Asquith and Mullin (1983), Born, Moser, and Officer (1984) and Miller and Rock (1985) dividend declaration provide information to the share holders to forecast the financial position of the company and the present firms earnings. This also depends on the source of information that either it is doubtful or not to respond on announcement of dividend. Hence, there remains disagreement till yet, the relation of dividend yield and stock price volatility and it is still unexplained and is considered as debatable in corporate CHAPTER 3: RESEARCH METHODS 3.1 Method of Data Collection Required data was collected from Karachi Stock Exchange as given by State Bank of Pakistan in publication of Balance Sheet Analysis of Joint Stock Companies Listed on the KSE (2005-2009). The period of study covered five years, 2005-09. The sample size of 100 non-financial firms was taken from all non financial firm listed at KSE. The required sample was chosen on the basis of cash dividend paid by firms at-least for two years. The sample represents major industry. 3.2 Sample Size Sample of 100 non-financial firms was collected from KSE. Sample consisted of firms which paid cash dividend for at least two years. Firms that was selected for study represented all major industries functioning in Pakistan and listed at KSE from 2005-2009. The impact of the cash flow and profitability on dividend payout was examined on selected sample of 100 non-financial firms. 3.3 Research Model Developed There were various financial factors of the non-financial firms which affected the Dividend payout of the firms. This research study investigated the impact of free cash flow and profitability on the dividend payout. 3.3.1 Dividend payout Dividend payout and dividend amount are taken as the dependent variables. Since dividend payout is the generally used alternative for dividend policy, almost every financial researcher has used payout as a proxy for corporate dividend policy (See for example Gugler, 2003; Reddy and Rath, 2005; Papadopoulos, 2007; Al-Malkawi, 2007; Ahmed Attiya, 2009). In order to calculate dividend payout was calculated as cash dividend per share divided by earning per share. 3.3.2 Earning per share According to Hafeez and Attiya (2009) high profitability with constant earnings can manage to pay for larger free cash flows as a result to pay out larger dividends. The earnings per share after tax were used as independent variable. Earning per share after tax was used because dividend has been paid after interest, taxes and after depreciation and calculated as net earnings divided by number of shares. H1: There is significant impact of earning per share on dividend payout 3.3.3 Return on Equity This variable is used in different previous studies such as: Abor (2005), Miller (2007), Al-Ajmi et al. (2009), and Ebaid (2009) etc. Some authors measured profitability or performance by three measurements such Gross profit margin (GPM), Return on Equity (ROE), and Return on Assets (ROA) and same predictors Ebaid (2009). Likely results with this variable are same as revealed by Abor (2005) and Ebaid (2009) such as: Significance and positive relationship with dividend payout. Return on Equity is considered best measure of firm profitability. Return on Equity (ROE) is one measure of how efficiently a company uses its assets to produce earnings. ROE was calculated by dividing Net Income minus preferred dividend by Share holder equity H2: There is significant impact of Return on Equity on dividend payout. 3.3.4 Free Cash flow According to Jensens (1986) free cash flow hypothesis, companies choose to use their cash resources to invest in profitable projects first; dividend is paid out of residual. From a companys point of view, cash generated from operations plays an important role in deciding the level of payout, among all three sources of cash flows i.e. operating; investing and financing, cash generated from operations is considered as most desirable source of funds for the company for distribution of dividends. Anil and Sujjata (2008) also found cash flow from operations as the most significant determinant of dividend policy in Indian IT industry. A  measure of financial performance calculated as Net income minus depreciation minus change in working capital minus change in capital expenditure. Free cash flow (FCF) represents the cash that a company is able to generate after  placing out the money required to maintain or expand its asset base.  Free  cash flow is important be cause it  allows a company to  pursue opportunities that enhance shareholder value. H3: There is a significant impact of free cash flow on dividend payout. The model developed was a linear model and its specifications are provided below: Div payout = a0 a1EPS + a2ROE + a3FCF + ц Dividend payout = Dividend per share divided by earning per share EPS = Net income divided by number of share outstanding ROE =Net income minus preferred dividend divided by common shareholder equity FCF =Net income minus Depreciation minus change in working capital minus change in Capital expenditure à Ã¢â‚¬Å¾ = error term 3.4 Statistical Technique Multiple Linear Regression Analysis (MLR) technique was used for this research study to examine the impact of the distinctive financial characteristics of the non-financial firms on their dividend payout of the selected firms; Statistical Package for the Social Sciences (SPSS) was used for the examination of the secondary data. CHAPTER 4: RESULT The sample of 100 non-financial firms from Karachi Stock Exchange was taken into consideration. This research study used multiple regression analysis (MLR). Researcher examined the behavior of non-financial firms of KSE about dividend payout. The selected technique was used to study the impact of cash flow and profitability on dividend payout. 4.1 Finding and Interpretation of the results In the beginning, the regression technique was applied on collected data by using SPSS, and there was no single variable was significant. It was clear from the result that there was the high co-linearity among the independent variables of the dividend payout and this means there was strong interrelationship present among the predictors. Return on assets and net profit margin was omitted from the data, thus, the issue of co-linearity was resolved. Now, proceeding with the analysis of the results because issue of co-linearity was addressed. The interpretation and analysis is presented in the next sections of this research study. Table 4.1: Model Summary Mod R R Sq. Adj. R Sq. 1 .289 .084 .078 Tables 4.1 depict the summary about the regression model. The R square of 8.4% showed that all the predictors of dividend payout together explained 8.4% variation in the dependent variable and the remaining variation was unexplained or hidden predictor were not included in the model. TABLE 4.2:ANOVA Model Sum of Squares df Mean Square F Sig. 1 Regression 31503.936 3 10501.312 15.236 .000a Residual 345316.428 501 689.254 Total 376820.364 504 The table 4.2 checked the significance of the linear regression model in such a way that the reliability of the data file regarding the applicability of the regression technique can be understood from the above table; however, ANOVA table was reliable test of checking the linear regression models ability to explain any variation in the dependent variable of liquidity. This was perfectly obvious from the sig value of .000 that meant that the linear regression model was highly significant for the data collected for the research study conducted. In addition, ANOVA explained that all means are not equal. In table4.3 the final model of regression included only three independent variable that were free cash flow, earning per share, and return on equity These variables were included in the model due to highly significantly describing the relation with dependent variable dividend payout. Returns on equity and free cash flow have positive impact on dividend, while earning per share has negative impact on dividend payout. 4.2 Hypothesis Assessment Summary The hypothesis of research was unique financial factors had significant impact on the non-financial firms dividend payout decision. These financial characteristics were cash flow taken as free cash flow of firms and profitability taken as earning per share and return on Equity of firms. This research tasted individual financial characteristics and concluded the result as follow. TABLE 4.4: Hypothesis Assessment Summary S.No. Hypothesis ÃŽÂ ² SIG. RESULT H1 There is significant impact of free cash flow on dividend payout. .001 .005 Accepted H2 There is significant impact of Return on equity on dividend payout. .216 000 Accepted H3 There is significant impact of Earning per Share on dividend payout. -.123 .016 Accepted H4 There is significant impact of Return on Assets on dividend payout. .340 .170 Rejected H5 There is significant impact of Net profit margin on dividend payout. -.034 .530 Rejected CHAPTER 5: DISCUSSIONS, IMLICATION, FUTURE RESEARCH AND CONCLUSION 5.1Conclusion It was concluded with support of results of this research study return on equity, earning per share, and free cash flow were significant independent variables in Pakistani market. These result were matching with the study under taken by Hafeez and Attiya (2009) in Pakistani context, Researchers concluded firms with high profitability and with stable earning can afford larger free cash flow therefore pay out larger dividends to its shareholder. In addition, Talat and Hammad (2010) examined the ownership structure and cash flow as determinants of dividend policy. Researchers concluded that companies in which high proportion of share were occupied by managers and individual were more reluctant of pay high dividends. In contrast, companies in which managerial and individual ownership is low paid less dividends. It was also concluded that companies having high operating cash flow increase companies potential to pay high dividend and it was considered cash flow sensitivity reduce the compa nies payout but still it was not determined as potential determinants of corporate payout in Pakistan. 5.2 Discussions Profitability and free cash flow could lay significant impact on dividend payout in Pakistani context. Hafeez and Attiya(2009) was also considered profitability as significant determinant of dividend payout, But study conducted by Talat and Hammad (2010) concluded operating cash flow cannot consider significant determinant of dividend payout in Pakistani market.This research considered that free cash flow and profitability measured through earning per share and returns on equity have significant impact on dividend payout of the companies. 5.3 Implication and Recommendations This research was encompasses non-financial companies listed on Karachi Stock Exchange Pakistan. The required data collected from 100 non-financial firms listed at KES for the period of 2005 t0 2009. Only firms were included in samples which were paid cash dividend for atleast two years. It is recommended that such type of study should be carried out in other countries of Asia. Further, it also recommended that other determinants except one analyzed in this study should be researched in more extensive manner so the dividend payout policy and its dynamics became clearer. 5.4 Future Research This research addressed the problems of investor, management and other researcher conductor in examining and observing the behavior of firm regarding their payout decisions. Research students who want to work further on dividend payout could be benefited by this study. In addition, all non financial firms will get benefit from this study because this research study taken all major sectors into the consideration and study clarified the impact of free cash flow and profitability on dividend payout. Cash Flow and Profitability of Dividend Payout Cash Flow and Profitability of Dividend Payout CHAPTER 1: INTRODUCTION Overview The issue of dividend has been studied comprehensively in last few decades. Still it remained as one of the most debatable issue in the field of Finance. The contradictory nature and massive importance 0f dividend in finance had made it one of the most discussable topics for researchers. Researchers in the past enclosed many aspects of dividend; few among them are views about dividend, dividend payment effects on firm value, dynamics and determinants of dividend policy, and dividend movement of different markets. Lintner (1956) study the allocation of income of corporations among dividends, retained earnings and taxes by taking data from the years 1918 to 1941 as a training period and data from the years 1942 to 1951 as the testing period. Researchconcluded that the basic origin of dividend changes werenet earning and preceding year dividends. In addition, firms attempt to continue a constant stream of dividend and influence to make a regularly partial adjustment to a target payout ratio relatively hysterically changing their payout when a change in income occurs. In the short run, dividends are consistent to avoid frequent changes. This dispute is rooted back to the significant effort of Miller and Modigliani (1961), in which it was challenged in a perfect market condition dividend policy did not affect the value of firm. In contrast, Lintner (1962) and Gordon (1963) based à ¢Ã¢â€š ¬Ã…“Bird-in-handà ¢Ã¢â€š ¬? theory and argued that in the world of ambiguity and imperfect information, hig h dividend payment is linked with high firm value. In addition, Black (1976) called dividend as great puzzle which need extensive researched. Furthermore, the Brealey and Myers (2005) listed dividend as one of the top ten significantvague topic in advance corporate finance. According to Anil and Sujjata(2008) emerging consensus was that no individual factor alone can describe dividend behavior. The existing corporate theories supported that cash flow and profitability have significant impact on dividend. The aim of this study was to know the impact of cash flow and profitability on dividend payout of non financial firms in Pakistan market. This study considered free cash flow and profitability was most important for non financial firm in Pakistan market. Talat and Mirza(2010) conducted research related to ownership structure and cash flow as predictor of dividend payout policy. According to that personal ownership, cash flow delicacy, size, and leverage were negatively associated with dividend payout policy. In contrast, profitability and operating cash flow was found as determinants of cash dividend. In addition, Researcher concluded that executive ownership, personal ownership, operating cash flow, and size were important determinants of dividend while, leverage and cash flow delicacy did not contribute considerably in determining the level of corporate dividend payment. DeAngelo and DeAngelo (1990) found significant relation between cash flow and dividend changes. Problem Statement In the field of corporate finance, the dividend was considered as one of the most noteworthy issues. The main purpose to study the impact of cash flow and profitability on dividend payout of non financial firm in Pakistani market was to analyze the cash dividend behavior of developing countries firm. In addition, study was conducted to find out how strongly these two variables free cash flow and profitability have impact on the dividend payout because, profitability was most likely used as determinants of dividend payout in most of the previous researches but free cash flow was not taken too much in previous research. Furthermore, how these two variables serve as an indicator for dividend payout. Hypothesis This research study has tested the following hypothesis to fulfill the objective of the research. H1: There is significant impact of free cash flow on dividend payout. H2: There is significant impact of return on assets on dividend payout. H3: There is significant impact of return on equity on dividend payout. H4: There is significant impact of earning per share on dividend payout. H5: There is significant impact of net profit margin on dividend payout. Outline of the Study The research structured follows. Chapter one was consist on the introduction of the thesis, it is essential to review the views and theoretical background of dividend, the statement o problem, scope and objective, hypothesis. Chapter two consisted of literature review given by various authors, theories on dividend and impact of cash flow and profitability on dividend payout. Chapter three explained methodology, it consisted of explanation of the selection of the variables, the sampling and research design, the data technique and hypothesis. Chapter four represents the analysis of results after processing the data. Chapter five composed of final result, conclusion and recommendation. Chapter six consisted of references. CHAPTER 2: LITERATURE REVIEW Since 1956, dividend has always considered one of the most interested and investigated topic in world of finance.Lintner (1956) analyzed the allocation of earning of corporation among dividends, retained earnings, and taxes by taken data into consideration for years 1918 to 1941. It was found the basic determinants of dividend change are net earning and preceding year dividends. In addition, firms tried to continue a stable flow of dividend and likely made a regularly limited adjustment to a target payout ratio instead radically changing payout when earning changed. Jensen and Meckling (1976) paid attention toward agency cost hypothesis and described that dividend restricted the funds under management control, as a result putting them under strict capital market examination. Owner responsibility was reduced to deal with the quality of investment and to handle the expenditure on manager prerequisites. Marke, Langrehr, and Hexter(1998) conducted research on dividend policy determinants. Researchers had taken focus of firm, natural log of sales of firm, inside ownership for firm, no of common shareholder for firm, free cash flow for firm, sales growth of firm, and standard deviation of returns o f firm as determinants of dividend policy. Authors concluded that corporate focus has negative impact on dividend payout. While inside ownership had also negative impact, according to researcher the firms have greater inside ownership have small dividend payout. In addition, the firms with higher free cash flow have higher dividend payout and lower payout ratio of firms with higher standard deviation of returns. William and Nanda (1994) conducted research on free cash flow, shareholder value, and the unallocated profits after tax of 1936 and 1937. In this study researcher tried to explore the investor reaction toward the anticipated decrease in free cash flow presented to corporate managers. In addition, researchers suggested agency costs as partial determinants of dividend policy. To avoid the agency problem corporate have to pay higher dividend and imposed higher tax on undistributed profit so the problem of agency cost handled efficiently. The study conducted on determinants of dividend payout ratio in GhannabyAmidu and Abor (2006). In this study 20 listed firms of Ghana Stock Exchange were used as a sample which shows 76% of the total listed firm in Ghana Stock Exchange. Researchers have taken the Payout Ratio as controlled variable and explanatory variables includes risk, profitability, cash flow, corporate tax, institutional holding, sales growth, and market to book value. It was foundthat more profitable firms paid more dividends and profitability is positively related to dividend payout. In addition, cash flow and taxes are also positively related to dividend payout. Further, they also concluded there is a positive relationship between increase in liquidity and dividend payout. Results suggested negative relationship of dividend payout with growth, market to book value, risk, and institutional holding. The firms with the earning instability found hard to pay low and no dividends. Al-Malkawi (2007) worked on determinants of corporate dividend payout policy in Jordan. Researcher used a firm level panel data of all publicly traded firms on the Amman Stock Exchange for the year 1989-2000. Researcher used dividend payout as a depended variable and agency cost, Ownership, annual share turnover, market to book ratio, market capitalization of common equity, financial leverage ratio, profitability ratio, and taxes as independent variables. By using Tobit specification researcher concluded that positive relationship between size, age, and profitability with dividend payout and negative relationship between signaling device, ownership, and taxes in Jordan. Fairchild (2010) worked on Dividend policy, signaling and free cash flow: an integrated approach. Researcher has tried to examine the dividend policy by taking only two hypothesis signaling and free cash flow. In order to understand the composite environment of dividend policy, signaling game is developed in which most of the information possesses by managers than investors about the quality of the firms. The signaling hypothesis shows that asymmetric information between managers and investor, dividend work as signal regarding current performance and future prospect. The study found that high dividend has positive effect on the firm performance, in term of providing a positive signal for current performance and as will as future scenario. In addition, dividend payout reduces the free cash flow problem, which may attract the manager to invest in negative NPV project for personal interest. But if the project shows positive NPV so investment opportunities are available which lead toward the higher dividend in future. Gill, Nahum, and Rajendra (2010) worked on determinants of dividend payout ratio in United States. In this study researcher extend the Amidu and Joshua, and Anil and Kapoor finding for the American service and manufacturing firms. Researcher took same variables into account such as profitability, tax, market to book value, cash flow, and sale growth. The sample size was 266 out of 500 financial reports. According to the researcher dividend payout ratio of manufacturing firms is the function of profit margin, tax, and market to book value ratio. It was also found that result differ when the dividend payout ratio was defined as the ratio between after tax cash flow and cash dividend, not considering after tax earning of the companies. Reddy (2006), studied the dividend behavior of Indian companies, movement, and determinants and struggled to decide the behavior of the companies listed at Bombay Stock Exchange with theassist of trade off theory and signaling theory hypothesis. According to researcher analysis of dividend trend depicted that stock traded on New York Stock Exchange and Bombay Stock Exchange indicated that percentage of companies paying dividend has declined from 60.5% in 1990 to 32.1% in 2001 and there is only few companies paying dividend constantly. Beside that firms paying dividend are more profitable, large in size, and having enough growth. Indian context did not represent corporate tax and ax preference theory. Lastly the dividend change indicated signal to current and lagged earning performance rather than future earning performance. Baker, Farrelly and Edelman (1986) studied New York Stock Exchange 318 firms. According to the researchers main determinants of dividend payments were expected future earning and picture of past dividend. Gitman and Pruitt (1991) asked 1000 largest US firms financial managers and concluded present and precedent year earning were significant determinants effect dividend payment. According to Baker and Powell (2000) survey companies listed on New York Stock Exchange were industry explicit and predicted level of future income was the main factor of dividend payout Anil and Kapoor (2008) studies Indian information technology sector for determinants of dividend payout ratio. The phase for study 2000-2006 encompass both recessionary and booming phase of Indian information technology sector. Researcher concluded that beta and liquidity was discovered a notable determinant of dividend payout ratio. In addition, authors concluded that due to recession from 2003 onwards IT sector observed exponential growth, and it was anticipated linear growth in IT sector after 2006. Recently in Pakistani perspective, Ahmed and Attiya (2009) investigated sample of 320 non-financial firms listed on Karachi Stock Exchange from 2001 to2006.Researchers concluded Pakistani companies dependent more on current earning than past dividend. In addition, authors highlighted few predictors that may affect payout policies. Firstly, the finding demonstrated companies containing high profit with consistent earning can manage larger amount of free cash flow as a result to payout larger dividend. The firms having larger investment chance can easily affect and have a significant role in determinants of dividend payout policy in Pakistan. The companies paid more dividends to shareholders where inside ownership exist. Ownership structure has considered major factor in determining dividend policy in Pakistan. Beside that dividend payout was not affected pay growth of the firms and market liquidity has a significant impact on dividend payout. Furthermore, size was significant determin ants for dividend payout that means companies invest in assets relatively paying dividends to its stockholders. 2.1 Dividend irrelevance theory: Miller and Modigliani (1961) proposed that dividend policy is irrelevant to the shareholder and stockholder wealth was constant in the world of perfect market condition and any growth in the current payout is financed by literally priced stock sales. The basic assumption was that management paid 100 percent payout in every period. Other assumptions were as follow. First, market is perfect capital market that means there were no taxes on transaction cost, single buyer and seller not influenced price and everyone have free access to information. Second, investors are rational and value of securities was based on the discounted future cash flow to investor. Third, manager act as a agent of shareholders, and there was no uncertainty about the investment policy of the firm. 2.2 Bird-in-hand theory: Al-Malkawi (2007) emphasized that dividend valued differently from retained earnings (capital gains) in world of ambiguity and irregularity information. à ¢Ã¢â€š ¬Ã…“A bird in hand (dividend) is valued more than two in the bush (capital gain)à ¢Ã¢â€š ¬?. Investors always preferred dividends to retained earnings due to uncertainty of future cash flow. Although, this controversy has been extensively condemned and has not get strong empirical base, but, it was supported by Gordon and Shapiro (1956), Lintner (1962), and Walter (1963). The basic assumptions were as followed Firstly, investors have inadequate information regarding the profitability of a firm. Secondly, cash dividend was taxed at a higher rate when capital gain was realized on the sale of share. Thirdly, dividend serves as a signal of expected cash flow. 2.3 Agency cost and free cash flow theory: Ross (2008) define agency cost is the cost of the conflict of interest that exists among shareholders and management. It was happened when management act for own interest rather than shareholders interest who own the firm. This could be direct and indirect. It was in contrast to assumption of Millar and Modigliani (1961) that mangers act as an agent of shareholders. This is somewhat dubious, as the owners of the firm are different from the management. Managers are bound to carry out some activities, which could be costly to shareholders, such as undertaking unprofitable investments that would yield excessive returns to them, and unnecessarily high management compensation (Al-Malkawi, 2007). These costs are borne by shareholders; therefore, shareholders of firms with excess free cash flow would require high dividend payments instead. Agency cost may also arise between shareholders and bondholders: while shareholders require more dividends, bondholders require fewer dividends than shar eholders by putting in place a debt covenant to ensure availability of cash for their debt repayment. Easterbrook (1984) also identified two agency costs: the cost of monitoring managers and the cost of risk reluctance on the part of managers. Jensens free cash flow/overinvestment hypothesis (1988) provides a surrogate description for the positive association between the direction of the dividend change and the stock price reaction. Jensen argues that managers tend to hold cash to invest in negative NPV projects for their own utility maximization. The agency costs that result from this overinvestment decrease the value of the firm. Like the signaling hypothesis, the FCF argument suggests there should be a positive relationship is the direction of the dividend policy change and the stock price reaction. However, the FCF argument differentiates itself with respect to the level of growth opportunities faced by the firm. If a firm initiated a cash dividend, FCF arguments postulate there are fewer funds available for costly overinvestment. Likewise, if company didnt pay dividend, the strongest form of a decrease would reduce the value of the firm because there are more funds available to invest in less present value projects. The FCF hypothesis assumes larger stock price volatility for the firms who have few growth opportunities as compared to the firms with many growth opportunities. There is disagreement between different researchers on dividend policy. Allen and Rachim (1996) in Australia found no significant association between stock price volatility and divided policy. According to Gordon (1963) the stock price volatility is influenced by dividend payout. The firms who pay large dividend have minimum risks in terms of stock price value. Some of hypothetical mechanism also suggests the universal relationship of dividend yield and dividend payout ratio with stock price volatility. Jensens and Meckling (1976) developed Agency cost argument which proposed that dividend payout lower the cost of funds and increase the cash flows for the company. The company after paying cash dividends to stock holders would have less cash in hands of the managers to invest at below the cost of capital. According to Asquith and Mullin (1983), Born, Moser, and Officer (1984) and Miller and Rock (1985) dividend declaration provide information to the share holders to forecast the financial position of the company and the present firms earnings. This also depends on the source of information that either it is doubtful or not to respond on announcement of dividend. Hence, there remains disagreement till yet, the relation of dividend yield and stock price volatility and it is still unexplained and is considered as debatable in corporate CHAPTER 3: RESEARCH METHODS 3.1 Method of Data Collection Required data was collected from Karachi Stock Exchange as given by State Bank of Pakistan in publication of Balance Sheet Analysis of Joint Stock Companies Listed on the KSE (2005-2009). The period of study covered five years, 2005-09. The sample size of 100 non-financial firms was taken from all non financial firm listed at KSE. The required sample was chosen on the basis of cash dividend paid by firms at-least for two years. The sample represents major industry. 3.2 Sample Size Sample of 100 non-financial firms was collected from KSE. Sample consisted of firms which paid cash dividend for at least two years. Firms that was selected for study represented all major industries functioning in Pakistan and listed at KSE from 2005-2009. The impact of the cash flow and profitability on dividend payout was examined on selected sample of 100 non-financial firms. 3.3 Research Model Developed There were various financial factors of the non-financial firms which affected the Dividend payout of the firms. This research study investigated the impact of free cash flow and profitability on the dividend payout. 3.3.1 Dividend payout Dividend payout and dividend amount are taken as the dependent variables. Since dividend payout is the generally used alternative for dividend policy, almost every financial researcher has used payout as a proxy for corporate dividend policy (See for example Gugler, 2003; Reddy and Rath, 2005; Papadopoulos, 2007; Al-Malkawi, 2007; Ahmed Attiya, 2009). In order to calculate dividend payout was calculated as cash dividend per share divided by earning per share. 3.3.2 Earning per share According to Hafeez and Attiya (2009) high profitability with constant earnings can manage to pay for larger free cash flows as a result to pay out larger dividends. The earnings per share after tax were used as independent variable. Earning per share after tax was used because dividend has been paid after interest, taxes and after depreciation and calculated as net earnings divided by number of shares. H1: There is significant impact of earning per share on dividend payout 3.3.3 Return on Equity This variable is used in different previous studies such as: Abor (2005), Miller (2007), Al-Ajmi et al. (2009), and Ebaid (2009) etc. Some authors measured profitability or performance by three measurements such Gross profit margin (GPM), Return on Equity (ROE), and Return on Assets (ROA) and same predictors Ebaid (2009). Likely results with this variable are same as revealed by Abor (2005) and Ebaid (2009) such as: Significance and positive relationship with dividend payout. Return on Equity is considered best measure of firm profitability. Return on Equity (ROE) is one measure of how efficiently a company uses its assets to produce earnings. ROE was calculated by dividing Net Income minus preferred dividend by Share holder equity H2: There is significant impact of Return on Equity on dividend payout. 3.3.4 Free Cash flow According to Jensens (1986) free cash flow hypothesis, companies choose to use their cash resources to invest in profitable projects first; dividend is paid out of residual. From a companys point of view, cash generated from operations plays an important role in deciding the level of payout, among all three sources of cash flows i.e. operating; investing and financing, cash generated from operations is considered as most desirable source of funds for the company for distribution of dividends. Anil and Sujjata (2008) also found cash flow from operations as the most significant determinant of dividend policy in Indian IT industry. A  measure of financial performance calculated as Net income minus depreciation minus change in working capital minus change in capital expenditure. Free cash flow (FCF) represents the cash that a company is able to generate after  placing out the money required to maintain or expand its asset base.  Free  cash flow is important be cause it  allows a company to  pursue opportunities that enhance shareholder value. H3: There is a significant impact of free cash flow on dividend payout. The model developed was a linear model and its specifications are provided below: Div payout = a0 a1EPS + a2ROE + a3FCF + ц Dividend payout = Dividend per share divided by earning per share EPS = Net income divided by number of share outstanding ROE =Net income minus preferred dividend divided by common shareholder equity FCF =Net income minus Depreciation minus change in working capital minus change in Capital expenditure à Ã¢â‚¬Å¾ = error term 3.4 Statistical Technique Multiple Linear Regression Analysis (MLR) technique was used for this research study to examine the impact of the distinctive financial characteristics of the non-financial firms on their dividend payout of the selected firms; Statistical Package for the Social Sciences (SPSS) was used for the examination of the secondary data. CHAPTER 4: RESULT The sample of 100 non-financial firms from Karachi Stock Exchange was taken into consideration. This research study used multiple regression analysis (MLR). Researcher examined the behavior of non-financial firms of KSE about dividend payout. The selected technique was used to study the impact of cash flow and profitability on dividend payout. 4.1 Finding and Interpretation of the results In the beginning, the regression technique was applied on collected data by using SPSS, and there was no single variable was significant. It was clear from the result that there was the high co-linearity among the independent variables of the dividend payout and this means there was strong interrelationship present among the predictors. Return on assets and net profit margin was omitted from the data, thus, the issue of co-linearity was resolved. Now, proceeding with the analysis of the results because issue of co-linearity was addressed. The interpretation and analysis is presented in the next sections of this research study. Table 4.1: Model Summary Mod R R Sq. Adj. R Sq. 1 .289 .084 .078 Tables 4.1 depict the summary about the regression model. The R square of 8.4% showed that all the predictors of dividend payout together explained 8.4% variation in the dependent variable and the remaining variation was unexplained or hidden predictor were not included in the model. TABLE 4.2:ANOVA Model Sum of Squares df Mean Square F Sig. 1 Regression 31503.936 3 10501.312 15.236 .000a Residual 345316.428 501 689.254 Total 376820.364 504 The table 4.2 checked the significance of the linear regression model in such a way that the reliability of the data file regarding the applicability of the regression technique can be understood from the above table; however, ANOVA table was reliable test of checking the linear regression models ability to explain any variation in the dependent variable of liquidity. This was perfectly obvious from the sig value of .000 that meant that the linear regression model was highly significant for the data collected for the research study conducted. In addition, ANOVA explained that all means are not equal. In table4.3 the final model of regression included only three independent variable that were free cash flow, earning per share, and return on equity These variables were included in the model due to highly significantly describing the relation with dependent variable dividend payout. Returns on equity and free cash flow have positive impact on dividend, while earning per share has negative impact on dividend payout. 4.2 Hypothesis Assessment Summary The hypothesis of research was unique financial factors had significant impact on the non-financial firms dividend payout decision. These financial characteristics were cash flow taken as free cash flow of firms and profitability taken as earning per share and return on Equity of firms. This research tasted individual financial characteristics and concluded the result as follow. TABLE 4.4: Hypothesis Assessment Summary S.No. Hypothesis ÃŽÂ ² SIG. RESULT H1 There is significant impact of free cash flow on dividend payout. .001 .005 Accepted H2 There is significant impact of Return on equity on dividend payout. .216 000 Accepted H3 There is significant impact of Earning per Share on dividend payout. -.123 .016 Accepted H4 There is significant impact of Return on Assets on dividend payout. .340 .170 Rejected H5 There is significant impact of Net profit margin on dividend payout. -.034 .530 Rejected CHAPTER 5: DISCUSSIONS, IMLICATION, FUTURE RESEARCH AND CONCLUSION 5.1Conclusion It was concluded with support of results of this research study return on equity, earning per share, and free cash flow were significant independent variables in Pakistani market. These result were matching with the study under taken by Hafeez and Attiya (2009) in Pakistani context, Researchers concluded firms with high profitability and with stable earning can afford larger free cash flow therefore pay out larger dividends to its shareholder. In addition, Talat and Hammad (2010) examined the ownership structure and cash flow as determinants of dividend policy. Researchers concluded that companies in which high proportion of share were occupied by managers and individual were more reluctant of pay high dividends. In contrast, companies in which managerial and individual ownership is low paid less dividends. It was also concluded that companies having high operating cash flow increase companies potential to pay high dividend and it was considered cash flow sensitivity reduce the compa nies payout but still it was not determined as potential determinants of corporate payout in Pakistan. 5.2 Discussions Profitability and free cash flow could lay significant impact on dividend payout in Pakistani context. Hafeez and Attiya(2009) was also considered profitability as significant determinant of dividend payout, But study conducted by Talat and Hammad (2010) concluded operating cash flow cannot consider significant determinant of dividend payout in Pakistani market.This research considered that free cash flow and profitability measured through earning per share and returns on equity have significant impact on dividend payout of the companies. 5.3 Implication and Recommendations This research was encompasses non-financial companies listed on Karachi Stock Exchange Pakistan. The required data collected from 100 non-financial firms listed at KES for the period of 2005 t0 2009. Only firms were included in samples which were paid cash dividend for atleast two years. It is recommended that such type of study should be carried out in other countries of Asia. Further, it also recommended that other determinants except one analyzed in this study should be researched in more extensive manner so the dividend payout policy and its dynamics became clearer. 5.4 Future Research This research addressed the problems of investor, management and other researcher conductor in examining and observing the behavior of firm regarding their payout decisions. Research students who want to work further on dividend payout could be benefited by this study. In addition, all non financial firms will get benefit from this study because this research study taken all major sectors into the consideration and study clarified the impact of free cash flow and profitability on dividend payout.

Comparing Oedipus and Hamlet :: comparison compare contrast essays

Free Essays - Oedipus vs. Hamlet as Tragic Protagonists Oedipus fits Aristotle's definition of the tragic flaw and protagonist almost flawlessly. Aristotle described the protagonist as "someone regarded as extraordinary rather than typical..."(1117). Oedipus freed Thebes from the Sphinx by solving her riddle-- something nobody else had been able to do. The priest in the first scene of Act I calls Oedipus "...our greatest power" (1121) and describes him as rated first among men. Hamlet is of noble birth but there is nothing else extraordinary about him. Unlike Oedipus, he had not saved a kingdom; he just happened to be born a prince. In tragedies the protagonists are usually of the nobility to make their falls seem greater. However, Aristotle said "What is finally important is not so much the protagonist's social stature as a greatness of character..." (1117). Protagonists, as described in our book, must also have a "determination to meet some goal or task to make them admirable"(1118). Oedipus set about to find the killer of King Laius to free Thebes from plagues. Hamlet's goal was to avenge the murder of his father. Oedipus immediately began to look for the killer, even when the evidence pointed to himself and ruined his life. Hamlet seems to put off killing Claudius. He chose not to murder him as he prays is Act III scene iii. In Act III scene i Hamlet says: " I'll observe his looks: I'll tent him to the quick: if 'a do blench, I know my course. The spirit I have seen may be a devil:"(1315) Even after the ghost tells Hamlet how he was murdered, Hamlet has the players act it out just to be sure. Obviously, there is no hard resolution for him to finish his task. Arthur Miller has said "tragic feeling is evoked in us when we are in the presence of a character who is ready to lay down his life.