Case Questions- PHILIP

 Case Questions- PHILIP Dissertation

Philip Andersen


Imagine one of Philip's clients is actually a married gentleman, aged thirty-six with two young children, who wishes to reallocate a significant slice of his retirement money that are presently invested in records of first deposit. Philip suggests a growth purchase, and he identifies three representative possibilities shown in Table A.

Table A

Three Investment Alternatives

Alternative A

Option B

Substitute C


Growth account from a huge investment company

Growth account from Stuart & Co.

Exchange-traded finance

Load or commission


5% front-end

3% to get

3% to sell

Average gross annual total comes back over previous 5 years (including administration fee) 15. 73%

12. 62%

14. 01%





Administration fees

zero. 4%

1 . 2%

For Client

110. 73% – 0. 4% -- 1 sama dengan 10. 33%

0. 96 * (110. 62% - 1 . 2%) - 1= 3. 96

0. 97 * 111. 01% *0. 97 – 1 = 4. 45%

For Stuart


five per cent + 0. 95 2. 1 . 2% =

6. 14%

3% + 0. 97 * 111. 01% * 3% =6. 23%

1 . Which will investment substitute:

a. Offers the highest earnings to the consumer?

b. Offers the highest profits to Stuart & Company.?

2 . If your answer to (b) is totally different from your reply to (a) and Philip recommends the highest revenue choice, is usually he operating unethically? How come or obtain?

3. Which usually alternative if the top managing of Stuart & Company. want Philip to recommend to his client? Is a company's control system built to ensure that decision? Philip

Philip Anderson

1 ) Which of the investment option:

Provides the highest returns for the client?

Provides the highest income to Stuart & Co.?

Alternative C provides the maximum returns for the client. It includes the highest common annual total returns over last a few years (net of managing fees). And its particular load or perhaps commission can be moderate.

Alternative B offers the highest profits to Stuart & Company. It has the highest management service fees, which direct benefits Stuart & Company., and the greatest load or commission.

2 . Which alternate should the leading management of Stuart & Co. want Philip to recommend to his consumer? Is the industry�s control system designed to ensure that choice?

The most notable management of Stuart & Co. would want Philip to recommend Option B to his customer, since Alternative B Can bring in optimum profits for the company.

You�re able to send control system designed to make sure that choice. The management put into practice results settings. The demand on branch managers to push particular products can be in-corporated within their annual sales budgets. And reword program also exists. So , in the event employees generate good results (selling specific products), they would get bonuses. It may well cause workers to be concerned about the consequences in the actions they take.

3. If perhaps Philip advises the highest profit choice (for the company), is this individual acting immorally?

Personally, I don't think that recommending the highest profit decision (for the company) is acting immorally. Because attaining maximum earnings of a company is the supreme goal of any company. And clients also can see a come back on the expense from that decision. So , Philip is just doing what this individual should do.

Yet , from the point of view of consumers, Philip doesn't act ethically. Obviously, clients hope that they may get support from Philip to achieve maximum return on investment. The goal more than likely be achieved if perhaps they pay attention to Philip to invest on the maximum profit choice (for the company). This way,...

In this case, we certainly have really two different points of view: in one side, there is Philip Anderson, the Phoenix branch manager of Stuart & Co., who handles a group with his techniques, his thought, his encounter but the outcomes do not reach the focuses on fixed by firm. In the other area, there is the direction of Stuart & Company., which has opposing ideas to Philip Anderson. I will try to assess the challenges Philip Anderson faces...