The VonFrederick 

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August 2007  Volume 5 Issue 8

  Feature Article:

Double Dog Dare You To Have Two Sets Of Books

Dr. Melissa K  Luke,  The VonFrederick Group

I would like to thank many of our readers for bearing through repeated articles while away for the last five months. Upon my return, my focus will be on the small business owner. I think we have heard enough about Sarbanes-Oxley for now.

Eighty percent of the United States economy is comprised of small to medium sized privately owned companies, however fifty percent of those companies fail in the first five years. Statistically, entrepreneurs’ starting new companies is as common as having a baby, unfortunately the death of a start up is equivalent to the divorce rate in America. What creates such an inverse relationship for the primary blood line of our country? In the following four months, we will cover the major reasons why small privately owned companies fail.

Reason #1: Financial Accounting versus Managerial Accounting Methodology

Most business owners understand little about the key financial operations of a company as far as accounting is concerned. Holding “two-sets” of books to run a company has a negative connotation, and many individuals think of this as an act of fraud when referring to financial balancing in such a fashion. However, having one set of books for the IRS, and one set for internal management purposes is precisely what every successful company should be doing. In reality all companies should own two sets of books, but the reason is far from illegal purposes.

Financial accounting is used for audits and taxation purposes. Depending on what type of legal entity a company operates (S-Corp., C-Corp., LLC, Partnership, Sole Proprietorship or other complex entity), year end data must be reported to the Internal Revenue Service to verify taxes due and or paid. In other words, financial accounting methodology is used for legal reporting methods.

Managerial accounting is derived to assist owners of a company to follow a clear path of the firm’s financial condition or “heartbeat” on a daily, weekly, monthly and yearly basis. The methodology is not an illegal practice, but a desired one for profitability that very few follow, due to a lack of understanding. Managerial accounting is based on the same numbers utilized in financial accounting, but re-organizes and calculates the numbers in a structure that assists in the business owners’ understanding of how to manage the daily operations. The IRS is not concerned with your net profit margin or break even point, but the owner certainly should be for maximum profitability.

Financial accounting will detail directives provided by the IRS for reporting measures, however it will not determine weekly or monthly margin percentages, comparative losses or gains on seasonal products over several years, 3-5 year projected budgets, comparative analysis on all expenses and costs of goods sold, overhead waste, break even points, labor costs percentages versus subcontractor costs, and other optimal percentage ratios to follow as a daily guide to operate a business. Once a managerial accounting system has been implemented, the business owner can utilize his or her books to grow the company and monitor the growth/decline of the organization on a daily basis.

The most basic accounting software tools such as QuickBooks and Peachtree are being used by 90 percent of small business owners. The major problem for most owners occur in understanding how to implement managerial accounting into the systems for personal use. Ask your CPA why he has not established a system for managerial bookkeeping, and he will reply “you never asked”.

Same numbers….different books ….different story.

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Apathy & Destructive Liberal Democrats

George A. Torres, MBA, Law Enforcement Specialist, The VonFrederick Group

"The distinction between the cause of the President in beginning the war, and the cause of the country after it was begun, is a distinction which [Democrats] cannot perceive."… Abraham Lincoln, 1848

It’s a small wonder that Osama Bin Laden and the army of Islamic Radicals fighting to create a caliphate believe that victory is within reach. They are counting on American apathy and liberal feebleness, which are not new phenomenon. 

American history bares this out. In the Revolutionary War, General Washington faced some of the same problems with Congress as President Bush. The decision to cross the Delaware River and raid Trenton in December 1776 was based on his belief that he had to do something or face defeat. He had suffered a series of severe defeats to the British army. Many of the Continental Army’s soldiers were wounded, sick, and demoralized. Soldiers were poorly equipped and clothed. Ammunition was in short supply. Desertions were rising and enlistment terms were almost up. The forefathers of today’s liberals were calling for surrender. Had he acquiesced to the liberals of yesteryear, there would be no United States. 

During the Mexican War of 1848 an apathetic populous opposed the war, even as the U.S. was winning, and were critical of President Polk. While a congressman, Abraham Lincoln opposed the war, but drew a line between his opposition to the origins of the war and his support for the troops once the war had begun. Unlike today’s liberals he restrained his harsh criticism of Polk until most the fighting had been concluded. Democrats attacked him for opposing Polk’s rationale for war. Lincoln answered by saying, "The distinction between the cause of the President in beginning the war, and the cause of the country after it was begun, is a distinction which you [Democrats] cannot perceive."

Ironically, sixteen years later Lincoln would face political oppostion fostered by destructive democrats. As the nation was involved in an arduous and bloody war to preserve the Union and eventually abolish slavery, Peace Democrats (liberal democrat forefathers) advocated surrender and compromise with the South. Peace Democrats perpetrated the same fraud as today’s Liberal Democrats. They accused “Republicans of provoking the South into secession, of waging the war in order to establish their own domination, to suppress civil and states rights, and impose ‘racial equality’; and military means would never restore the Union. On Aug. 29, 1864, the Democrats nominated a failed Union General George B. McClellan as their presidential candidate and ran on the platform "Compromise with the South", which became known as "The Chicago Platform". Thank God they lost. 

President Grant struggled with destructive Democrats in 1877. Democrats fostered the view that federal troops were “occupying” the South and the apathetic view the effort to establish stability was not worth the cost. They pressured Grant to withdraw the federal troops leaving blacks and white Republicans vulnerable to attack by the Ku Klux Klan, an arm of the Democratic Party. With suppression of black and Republican votes, Democrats quickly regained power and kept it by disenfranchising black voters with gerrymandering, literacy tests, poll taxes and riots. For example, in the 1888 election in Wilmington, NC, Democrats incited a bloody riot in which many died and Republican municipal officials, whose terms didn't expire until the next election, were forced to resign at gunpoint. Voter fraud and Democrats, some things never change.

President Wilson was subjected to apathetic citizenry cultivated by destructive Democrats during WWI. Even a New York Times editorial from February 26th, 1916, criticized "Democrats in Congress for taking the side of the enemy.” 

Even as late as 1941 the liberal icon, President Franklin Roosevelt, found himself mired in apathy and at odds with his own party about going to war against Hitler and Japan. With the attitude of “Let those European bastards beat each others’ brains out!” FDR promised not to send American troops “into any foreign wars.” The result was Pearl Harbor.

Islamic Fascist has studied the American History that our liberal academia refuses to teach. Bin Laden, al-Zawahiri and the hordes of Islamic Fascist know there best chance to win is Liberal Democrat control of government. While Zawahiri pronounces to the world that Al-Qaeda's long-term goals for Iraq are: to make it an Islamic state and to use it to establish a caliphate of Islamic rule across the region", willful ignorant and delusional Liberal Democrats claim Iraq is Bush’s “bumper sticker war”, that al-Qaeda is not in Iraq, that America is not involved in a war against Islamic Terrorism… 

History proves that Liberal Democrats are a destructive force against a free society. Maybe that’s why Islamic Fascist see them as allies?

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In the Horn of Africa, a desert country is suffering from what could amount to crimes against humanity. Villagers are brutalized by governmental troops, women gang raped, civilians killed for no other reason than being at the wrong place at the wrong time, houses and huts burnt to the ground. I know that names are popping up in your heads already. Darfur, no, too far from this geographic area! It must be Djibouti, a French territory, one of the last bastions of its colonial empire…or better, Somalia and its raging civil war between warlords, hard core Muslim militias, and a puppet government backed up by one of our allies in the “war against terror”, that is to say Ethiopia. 


Sorry, you are wrong and being kept in the dark for the culprit is an American backed government ruling over a country of 77 million! We train and arm its armed forces, provide them with intelligence so Islamic movements can be rooted out of the area, and we also close our eyes in front of the exactions that have been committed there since 1994.

Ethiopia…it is a country that is becoming more and more violent, and Ogaden is the province where the exactions are committed to prevent its secession from the country and to punish its people for the armed activities of the Ogaden National Liberation Front (ONLF). Deemed as terrorists because they resorted to violence after they failed to secede legally by following a process provided by the constitution, the soldiers of the ONLF have been blamed for bombings and murders, for the recent attack on an oil field and capture of 9 Chinese workers. 

The government of Ethiopia wants them added to the US terrorist list and denies any wrong doing but the ONLF claims that they were pushed to the armed struggle, and eventually had to conduct high profile armed operations, in order to attract foreign scrutiny over what is happening in Ogaden. 

And the tactics are working. From the US government to the European parliament, the killings documented by humanitarian agencies, are starting to be the main topics of heated debates. Ogaden is a forbidden area for news-media and foreigners, but watch groups from outside Ethiopia have already brought up thousands of cases of torture, mass rapes, executions, and illegal detentions that literally amount to “crimes against humanity” according to Human Rights Watch that labeled Ethiopia as “one of the most repressive countries in Africa”. 

Since 2005, when the opposition parties were about to win the majority of seats in the parliament, the central government has made sure to repress opposing political forces with the use of force, political murder and illegal imprisonment that have eventually sent surviving opposition leaders abroad. Furthermore, to strengthen its grip over the country, punitive lethal expeditions have also been regularly sent against ethnic minorities and the people of Ogaden.

Nice…all this is also paid by US taxpayers in the name of some twisted political alliance against people that are supposed to be worse.

Last year, we gave Ethiopia almost $300 millions and our legislature is trying to get them around $500 millions in 2008. 

Sure, new roads and buildings are appearing there, and crime is lowering while cut flowers and coffee are selling high on the international market. But most of our financial help has nothing to do with these “improvements” because these millions are labeled as “non humanitarian help”. 

Geopolitics at its best…side with the devil to destroy a bigger devil! 

But payback time will eventually come! What do you think? What should we do?

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An armed 15-year old youth entered his school with three guns and fired 51 bullets at students and staff. When it was over, two students were dead and 22 injured. Back home, the police found the boy’s parents also shot dead. It soon turned out that the accused assailant, Kip Kinkel, had been arrested the day before for trying to buy a stolen weapon. And this is only one of many incidents involving crime and violence on our school campuses.

Public schools must confront a number of challenges, such as how to educate students and provide a safe learning environment for students and staff. Despite overcrowding and other distractions in some districts, our schools are generally doing a good job educating and providing a safe environment for our children. However, recent violence in some of our schools has dispelled the notion that schools are safe. The 1999 schools shootings at Columbine High School in Littleton, Colorado, in which twelve students and one teacher were fatally gunned down by two students and (shortly after) a shooting at a suburban high school in Conyers, Georgia, where a student gunman opened fire on a group of students, reject this view of school safety.

There have been a number of shooting incidents and acts of violence directed at teachers and students throughout the nation following these shootings, and undoubtedly there will be more. And, in some communities, gang intimidation and drug dealing on campus are added to the school violence scenario. Drug use and abuse is now embedded in the school experience. But we must remember that schools are a collection of young people, most with serious aspirations to achieve in academic or extracurricular activities. It is a place of growth, a rite of passage before jumping into the uncertainties of adulthood. And for a few, it is a stressful environment, full of negativity and empty experiences, leading to crime, violence, or simply dropping out.

Schools, like workplaces, are miniature societies bringing together people from varied backgrounds, personalities, and cultural experiences. In other words, disruptive behavior and poor attitudes enter the school doors with students. Whatever the source of that violence, whether from the home, the community, or elsewhere, the effects of violence on learning are so destructive that educators are placing school security on the education agenda, a sign that they are taking this phenomenon seriously. Teachers cannot teach and students cannot learn in an environment of intimidation and fear.

Studies of school violence have variously used such terms as teen aggression, conflict, delinquency, conduct disorders, criminal behavior, and anti-social behavior to describe the sources of the problem. In simple terms, drugs, alcohol, hormonal imbalances, conflicts with peers or parents, rejection of authority, entertainment and Hollywood, and so forth fuel the anger many youth harbor. If the anger is not displaced at home, on the streets, or in some legitimate activities, then the schools are targeted. 
To be continued in September’s newsletter…

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Recent headlines proclaiming increasing youth violence: “4 Teenagers Charged in Murder of Tourist,” “Pupils Told to Run for Their Lives – Teacher Describes Terror in Classroom,” “FSU Student Murdered, Sister Raped – 18-year-old Beaten to Death, Sister Tied to Tree in Ocala National Forest.”
Youth crime is on everyone’s mind. It was the focus of virtually every political campaign of 2006. There is talk of boot camps, stricter laws, trying children as adults, larger prisons, harsher sentences, gun control and curfews. Take the kids off the streets so we can feel safe again! Keep them home! Why? So they can watch more murder and rape on television and DVD?

How weary we have grown of the statistics on how many murders every high school graduate has seen. According to the American Psychological Association, even before leaving elementary school, the average child has seen eight thousand murders and one hundred thousand acts of violence on television. 
Social science, clinical concepts, and common sense all agree that what children watch affects who they become, what they believe, what they value, and how they behave.

Television’s influence on our children starts earlier than most of us realize. Andrew Meltzoff found that fourteen-month-old infants can watch an unfamiliar toy being dismantled and reassembled on television and repeat the actions twenty-four hours later. Even at this early stage, television acts as a guide to real-life behavior. Throughout childhood, children learn by imitating what they see others doing.

Two to six-year-old children cannot evaluate the messages they receive from the media they watch. They simply accept what they see as normal behavior. Children cannot tell the difference between reality and fantasy until the fifth or sixth grade. Six to twelve-year-olds imitate what they see and hear without fully understanding the consequences of what they are doing. Most adolescents do not have a fully developed, internal set of morals and values. They accept the conduct they see in the media as the social norm and integrate it into their own behavior patterns.

What are the predominant messages of television, movies and other media that our children are watching and imitating? That violence is an everyday occurrence and an acceptable way of solving problems and that promiscuous sex is normal and expected of everyone, including younger and younger children. These two messages merge as the philosophy of pornography, once thought to be limited to sleazy adult bookstores and out-of-the-way art cinemas. The rape myth – that all women secretly want to be raped and that they enjoy forced sex – has so permeated our children’s minds that 65 percent of boys and 47 percent of girls agreed with a survey question that stated “it was acceptable for a man to force sex with a woman if he had been dating her more than six months.”

While television has unlimited potential for good, at the present time its influence on children’s lives is largely negative. Television programming, according to Dr. Paul Howard, a prominent Boston psychiatrist, is so hostile and aggressive it produces tremendous anxiety in young watchers. “One weekend of children watching television, “he declared, “undoes a whole week of psychotherapy for my young patients.”
Part two to be continued…

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Tempus Virtuous

(good), adj., morally excellent, kind, beneficent, honorable or worthy

Peter died, October 1, 2005, shortly after returning from his tour of duty in Iraq. Today, Memorial Day 2007, my mother, sister-in-law and I visited my brother’s grave to place two American flags: one for my brother’s military service during the Vietnam War as a Navy corpsman and as a Marine, reconnoitering landing sites in North Vietnam.

The second flag on my brother’s grave honored his year-long tour of duty in Iraq with the Army in 2004.

I was 15 years old when Peter was sent to Vietnam. I received many letters from him during his RR in Thailand. He was young, not yet 20 years and probably feeling immortal. His letters were full of delights he was discovering in Asia and the South Pacific Islands. He would send home pictures of monkeys on his shoulder and of his Navy/Marine buddies. He never shared the horrors of war he witnessed. Thirty years later, my sister-in-law, Peter’s wife mentioned to me he had been seeing a military counselor for his Vietnam experiences, before his deployment to Iraq. In 1969, as a naval corpsman, he was on the battle field, where ever that may have been. Little did he know that the Viet Cong was targeting corpsmen? The Vietnam War was a bloody battle without a front and medical assistance was persona non gratis. At least that is how Viet Cong saw it and deliberately dishonored medical aid as specified in the Geneva Convention.
.According to the Geneva Convention, “The wounded and sick shall be collected and cared for. 
An impartial humanitarian body, such as the International Committee of the Red Cross, may offer its services to the Parties to the conflict. 

The Parties to the conflict should further endeavour to bring into force, by means of special agreements, all or part of the other provisions of the present Convention.

The application of the preceding provisions shall not affect the legal status of the Parties to the conflict. 
Again, the Viet Cong did not honor the Geneva Convention rules established during WWII. The same goes with the Iraq War. Terrorists have their own agenda, a bizarre and twisted ideology; they are extremists and use Islam as their foundation. Terrorism has no foundation of faith, save for a hatred for those who do not believe as they do…get rid of any one who opposes their anarchy. Much like Hitler’s regime, and the Viet Cong.

My brother was raised understanding we are unconditionally loved. Our parents modeled this ideology. Peter was our eldest brother and a man who literally would take his own shirt off his back for another person who did not have shelter or clothing.

When we were very young Peter would bring home sickly animals that needed food and shelter. Along with Peter, my parents would nourish the animal--usually a domesticated and discarded dog or cat and/or a wild-life creature that its parent pushed out of the nest
.
Peter’s letters from Vietnam were legendary. Even better, with new electronic technology he was able to cell-phone or e-mail our family members during his tour in Iraq. His siblings, my parents, myself included, as well as his wife and children sent care packages per his request while in Iraq during 2004. We all knew the packages were not for him, but for others in greater need. Peter was in Iraq, serving his country, but serving his fellowman as well. We understood there were no boundaries, geopolitical, ideological or theological—we are all to serve one another. The following is an excerpt from a letter Peter wrote to our father, dated October 2003.

“Dear Dad, …our mission to Iraq was hauling vehicles for a civil affairs unit. Sunday we departed early 5 a.m. heading north to Fallujah…in the Sunni triangle. (Dad) the candy you had sent me was passed out to the children of Falluja. Most people are if not friendly at least tolerating us especially when we make their kids happy…”

A few months after his return from the Middle East Peter required surgery at his Army base In Texas and subsequently died of a massive coronary. On his headstone it reads: “Our Beloved Warrior.”

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Did You Know? Michelle Glisan Blevins         

• That even though Suriname is in South America their official language is Dutch

• That ALCOA, The Aluminum Company of America, started mining operations in Suriname in 1916

• That in 1667 the British exchanged their colony in Suriname for the Dutch holding of New Amsterdam- now known as New York

• That Suriname’s capital city, Paramaribo, is a World Heritage site

• That even though Suriname is only slightly larger than the American state of Georgia it has some 650 species of birds

Suriname’s flag consists of five horizontal bands of green (top, double width), white, red (quadruple width), white, and green (double width); there is a large, yellow, five-pointed star centered in the red band.

Jokichi Takamine

Takamine Jōkichi

November 3, 1854 - July 22, 1922

Jokichi Takamine was born in Takaoka, Japan- his father was a physician and his mother’s family owned a sake brewery. He was a bio-chemist educated in Tokyo, Osaka, Kyoto and Scotland. In 1884 Takamine traveled to the United States where he met and later married Caroline Field Hitch, they had two children together. They moved to Japan where Takamine established the Tokyo Artificial Fertilizer Company. While there he isolated the enzyme Takadiastase which was derived from Aspergillus oryzae- a fungus grown in rice which is used in the fermentation process of items such as sake. The family later moved back to the U.S. and in 1901 Takamine isolated the pure hormone adrenaline. When he learned of the effort by First Lady Helen Taft to beautify the Potomac Tidal Basin in Washington D.C., Takamine helped fund the donation of 3,000 cherry trees from Japan. In July 1922 Takamine died in New York City.

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How To Escape From Killer Bees

1. If bees begin flying around and/or stinging you, do not freeze.
   Run away; swatting at the bees only makes them angrier.

2. Get indoors as fast as you can. 

3. If no shelter is available, run through bushes or high weeds.
   This will help give you cover.

4. If a bee stings you, it will leave its stinger in your skin.
   Remove the stinger by raking your fingernail across it in a sideways motion. Do not pinch or pull the stinger out- this may squeeze mare venom from the stinger into your body. Do not let the stingers remain in the skin, because venom can continue to pump into the body for up to ten minutes.

5. Do not jump into a swimming pool or other body of water- the bees are likely to be waiting for you when you surface.
   This maneuver will cause the horse to walk in a circle. The horse will become bored, sense that you are in control again, and slow to a near stop. 

RISK OF ATTACK

• The Africanized honeybee is a cousin of the run-of-the-mill domesticated honeybee that has lived in the United States for centuries. The “killer bee” moniker was created after some magazine reports about several deaths that resulted from the Africanized bee stings some years back. Africanized honeybees are considered “wild;” they are easily angered by animals and people, and likely to become aggressive.
  Bees “swarm” most often in the spring and fall. This is when the entire colony moves to establish a new hive. They may move in large masses- called swarms- until they find a suitable spot. Once the colony is built and the bees begin raising their young, they will protect their hive by stinging.

(Piven and Borgenicht)

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The VonFrederick Group

Phone: (877) 207-1300
Fax:     (916) 488-7531
Email:

Dr. Lionel C.M. VonFrederick Rawlins
Lionel@VonFrederick.com

Dr. Melissa K. Luke
Melissa@VonFrederick.com

George A. Torres, MBA
George@VonFrederick.com

Eric Chevreuil
Eric@VonFrederick.com

Pat McLane
Pat@VonFrederick.com

Albert Globus, MD
Al@VonFrederick.com

General Clifford L. Stanely, Ph.D.
Cliff@VonFrederick.com

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