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htm
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What is meant by cost?
Cost refers to the resources (e.g., peoples time, materials, building space, etc.) used in the
production of goods or services, expressed in money terms.

Nature of Costs
Before one begin to understand how a business is going to perform over time and with shifts in
volume, it is imperative that to first consider the cost structure of the business. This requires
drilling down into the specific types of costs that are to be incurred and trying to
understand their unique attributes.

Elements of cost
The initial classification of costs is according to the elements upon which expenditure is
incurred:

Materials
Labour
Expenses

Direct and Indirect Costs

Direct materials
Direct labour
Direct expenses

Prime Cost
Total Cost

Indirect materials
Indirect labour
Indirect expenses

Overhead Cost

Functional Analysis of Cost

Basically cost can be categorized broadly into two classification as follows:

Overhead Classification: Overheads are usually categorized into principal activity

groups:
Manufacturing
Administration
Selling
Distribution
Research

Prime Cost Classification: Prime costs are usually regarded as being solely related to
production/performing an activity and so are not classified.

An important feature of management reporting is that it should emphasize the areas of the
business which require management attention and possible action.

Normal and abnormal costs

Controllable and non-controllable costs

Relevant and irrelevant costs
Fixed and variable costs

Components of Costing Analysis

All costing analysis exercises are characterized by adopting certain principles,
techniques and methods which form the key elements in the analysis process. The key
elements can be summarized as follows.

Marginal
costing

Costing

Standard
Costing

Costing

Absorption
costing
Budgetary
control

Principles

Techniques

ABC costing

Opportunity
costing
Information
data base

Costing
Methods

Costing

Specific
order costing

Contrac
t costing

Service
function
costing

Batch
costing

Job
costing
Product costing

Continuous
operation process
costing

Methods

Service costing
Service costing is that part of operation costing which is used in all organization who
provide services instead of producing of goods. For calculating the price of each service,
it is very necessary to collect all the expenses relating to that services. We make a cost
sheet in which we show all the cost relating to specific service. These costs are
calculated on the time basis. Following are the main organizations who provide services
Service Costing (some examples)
1. Salary
2. Insurance
3. Road Tax
4. Licence Fees
5. Interest on Capital
6. Repairs
7. Depreciation
8. Petrol Expenses
9. IT Service Related Cost
{*All companies who provide IT services must have to pay the expenses relating to IT
services. Main examples are hosting and domain cost, cost of data server and other
storage and power costs.

Value Analysis
Value analysis is a form of cost reduction, ie. A method of improving profitability by
reducing costs without necessarily increasing prices. It is in fact a systematic
interdisciplinary examination of factors affecting the cost of a service/product.
It takes a critical look at each feature of a service/product questioning its need and its
use and eliminating any unjustifiable features.
Two types of Value Analyses
Utility value: the value an item has because of the uses to which it can be put.
Esteem value: The value put on an item because of its beauty, craftsmanship etc.

Value Analysis Method

Value analysis is concerned with five areas as follows:

o
o
o

Establish the precise requirement of the customer.

Establish and evaluate alternative ways of achieving customers requirement.
Implement alternative ways if economically quality and reliability can be

achieved.
Evaluate feedback from new proposals to establish the benefits from the change.

Statement of Cash Flows

Provides information about cash inflows and outflows during an accounting
period
Is developed from Balance Sheet and Income Statement data
Important as an analytical tool

Importance of Cash Flow

Accrual-based accounting requires reporting revenues when earned and
expenses when incurred not when cash is exchanged.
Explains the reasons for a change in cash.
Reconciles net income with cash flow from operations.
Valuation models used in financial analysis are often based on projections of
future cash flows.

Preparing Cash Flow Statement

Four parts of a statement of cash flows:

Cash

Operating Activities

Investing Activities

Financing Activities

Cash

Cash includes Cash and Cash-equivalents

Cash Equivalents:

Treasury bills maturing within 90 days or less.

Investment Funds

Foreign Currency on hand

Checking Account

Free Savings Account

Operating Activities
Cash flows related to selling goods and services; that is, the principle business of
the firm.
The cash effects of transactions and other events that enter into the determination
of income
Examples of Operating Activities
Cash received from customers through sale of goods or services performed;
Cash payments to suppliers or employees
Cash payments for taxes and other expenses

Investing Activities
Acquiring/disposing of securities that are not cash equivalents
Cash flows related to the acquisition or sale of non-current assets.
Lending money/collecting on loans
Examples of Investing Activities

Cash received from sales of assets that are not held for the regular trading
purposes such as sale of building; marketable securities such as trading and
available for sale securities, and investments

Cash payments to acquire property, plant, and equipment (PPE), other tangible or
intangible assets, and other long-term assets

Cash received from sale of, and paid for purchases of derivative instruments

Loans extended to other companies and collection of such loans

Financing Activities
Borrowing from creditors/repaying the principal
Obtaining resources from owners
Providing owners with a return on investment
Examples of financing activities

Cash received from issuing share capital

Cash proceeds from issuing bonds, loans, notes, mortgages and other short or
long-term borrowings

Cash payments to shareholders to redeem existing shares- treasury stock

Cash repayment of loans and other borrowings; and

Cash payments to shareholders as dividends.

How Cash Flows During an Accounting Period

Inflows

Outflows
Operating Activities
Investing Activities
Financing Activities

Total Inflows less Total Outflows = Change in cash for the accounting
period

Components of the Cash Flow Statement

Cash received from
Operations

sale of goods

Cash paid for

cash flow

operating goods =

from operations

+ or Cash received from

Investing

sales of investments

Cash paid to purchase

-

cash flow

long-term investments =

from investing

+ or Cash paid for

Cash received from

Financing

issue of debt or

cash flow

dividends and to
=

from financing
=

repay debt or to buy

Net change in cash

cash inflows

cash outflows

for the period

Budgeting
is the process of identifying, gathering, summarizing, and communicating financial
and nonfinancial information about an organization's future activities . In fact Short-term
goals are the basis of an organizations operating budgets for the year.

Is essential part of the continuous planning for an organization in order to

accomplish long-term goals

The Budgeting Process:

Budgets

Plans of action based on forecasted transactions, activities, and events

Are synonymous with managing an organization

Budgets are used to

Communicate information

Coordinate activities and resource usage

Motivate employees

Evaluate performance

Manage and account for cash

Essential to accomplishing goals in the strategic plan

Establish minimum levels of cash receipts and expenditures

Many forms of budgets

Examples

Cash budget

Focuses on financial information

Production budget

Shows, among other things, how cash resources will

be allotted to operating, investing, and financing
activities over a future period

Focuses on nonfinancial information

Note: No standard format for budget preparation

Procedures vary from organization to organization

Only universal requirement is that budgets communicate the appropriate

information to the reader in a clear and understandable manner

Managers can improve the quality of budgets by using the following guidelines

Know the purpose of the budget

Identify the user group and its information needs

Identify sources of accurate, meaningful budget information

Establish a clear format for the budget

Use appropriate formulas and calculations to derive quantitative

information

Revise the budget until it includes all planning decisions

Person Responsible for Budget Development:

Organizations controller takes charge of coordinating the budget process.

Designs a complete set of budget-development directions

Assigns clearly defined responsibilities for carrying out each part of the
budgets development

Timetable with deadlines

To specific individuals or management teams

The budget may be reviewed and revised during the year

Importance of Participative Budgeting:

The key to a successful budget is participative budgeting

Process in which personnel at all levels of an organization actively engage

in making decisions about the budget

Gives a sense of ownership

Participative budgeting depends on joint decision making

Controller must be able to communicate and negotiate effectively with

people in all levels of an organization

Senior managers

Formulate organizational long-and short-term goals

Middle managers

Supervisors

Helps ensure that departments will attain targets and stay

within the budget

Responsible for daily operations

Authoritative budgeting

Senior executives dictate targets

Do not allow middle managers and supervisors a voice in setting

them

Targets may be unrealistic and impossible to attain

Will undermine motivation of managers and supervisors

Cooperation is essential for successful budget

implementation

Senior executives allow controller to develop budget without consulting

other managers

Managers may feel budgeting is not a top priority

Budgeting and the Management Cycle

Preparation of a Master Budget

elements of a master budget in different types of organizations and the

guidelines for preparing budgets

consists of a set of operating budgets and a set of financial budgets

that detail an organizations financial plans for a specific accounting
period, generally a year

Operating budgets

Plans used in daily operations

Basis for financial budgets

Financial budgets

Projections of financial results for the accounting period

Include

Budgeted income statement

Capital expenditures budget

Cash budget

Budgeted balance sheet

Preparation of a Master Budget for a Service Organization:

Sales budget

Is prepared first

Used to estimate sales volume and revenues

Once developed, other budgets can be developed

These other budgets will help manage the organization's

resources so that profits can be generated on sales

In a service organization, the sales budget is called the service revenue budget :

is a detailed plan, expressed in both units and dollars, that identifies

the product (or service) sales expected in an accounting period

Sales mangers use the information to:

Plan sales- and marketing-related activities

Determine human, physical, and technical resource needs

Accountants use the information to

Determine estimated cash receipts for the cash budget

To determine the total budgeted sales

Selecting the best estimates for selling price per unit and the sales demand in
units can be difficult:

If the organization wants to increase its share in the market

An estimated selling price below the current selling price may be

needed

If the organization has improved the products quality by using more

expensive materials or production processes

The estimated selling price may have to be higher than the current
price

The procedures for preparing operating budgets include:

Cost behavior analysis

Cost-volume-profit analysis

A product costing method

Organizations that manufacture a variety of products or services may prepare

Separate operating budgets, or

One comprehensive budget for each product or service

Estimated sales volume is very important:

Will affect the level of operating activities and amount of resources needed
for operations

Managers may use a sales forecast

A projection of sales demand based on an analysis of internal and

external factors

External factors taken into consideration in a sales forecast include:

The state of the local and national economies

The state of the industrys economy

The nature of the competition and its sales volume and selling price

Internal factors include:

The number of units sold in prior periods

The organizations credit policies

The organizations collection policies

The organizations pricing policies

Any new service/ products the organization plans to introduce to the

market

The capacity of the organizations production/manufacturing facilities

The Selling and Administrative Expense Budget:

is a detailed plan of operating expenses, other than those related to production, that
are needed to support sales and overall operations in an accounting period

Accountants use this budget to estimate cash payments for products or services
used in nonproduction-related activities

Financial Budgets
are projections of financial results

for an accounting period

Include

Budgeted income statement

Capital expenditures budget

Cash budget

Budgeted balance sheet

Budgeted income statement: projects an organizations net income in an

accounting period based on revenues and expenses estimated for that
period.

The Capital Expenditures Budget: is a detailed plan outlining the

anticipated amount and timing of capital outlays for long-term assets
in an accounting period.
Managers rely on information in a capital expenditures budget when
making decisions about such matters as:
- Buying equipment
- Building a new plant
- Purchasing and installing a materials handling system
- Acquiring another business
The Cash Budget: Is a projection of the cash an organization will receive
and the cash it will pay out in an accounting period
Summarizes the cash flow prospects of all transactions considered in the
master budget
Information it provides enables managers to plan for:
- Short-term loans when the cash balance is low
- Short-term investments when the cash balance is high

Excludes some planned noncash transactions

o Depreciation expense
o Issuance and receipt of stock dividends
o Uncollectible accounts expense
o Gains and losses on sales of assets
May also exclude
o Deferred taxes
o Accrued interest

To calculate the estimated ending cash balance:

Estimated
Ending
Cash
Balance

Total
Estimated
Cash
Receipts

Total
Estimated
Cash
Payments

Estimated
Beginning
Cash Balance

Sources for estimating cash receipts:

Sales budget

Budgeted income statement

Cash budgets from previous periods

Cash collection records and analyses of collection trends

Records pertaining to notes, stocks, and bonds

Sources for estimating cash payments

Operating budgets

Budgeted income statement

Capital expenditures budget

Previous years financial statements

Loan records

An example of Cash Budget

The Budgeted Balance Sheet: Projects an organizations

at the end of an accounting period

financial position

Uses all estimated data compiled in the course of preparing a master budget

Is the final step in that process

The make-up of the budget committee ensures that the budgeting process has a
companywide perspective ie. The controller, vice-president and president.
Budget Implementation Process:

A master budget may go through many revisions after approval

Budget committee monitors the progress the company is making in

attaining budget targets

Using periodic reports from department managers

Successful budget implementation depends on two factors

Clear communication

Support of top management

Middle- and lower-level managers must see that top management

supports the budget and encourages its implementation

BUSINESS PERFORMANCE ANALYSIS

Business performance analysis is the enabler for identifying what is required to be done to
achieve the desired change or Goal.
Objective
The objectives of Business Performance Analysis in a firm is to ensure that the firm has been
managed effectively and efficiently to guarantee :

Financial Statement Analysis (FSA)

Financial Statement Analysis will help business owners and other interested people to
analyse the data in financial statements to provide them with better information about
such key factors for decision making and ultimate business survival.

It is also the collective name for the tools and techniques that are intended to provide
relevant information to the decision makers. The purpose of the FSA is to assess the
financial health and performance of the company.

It involves obtaining a broader picture of the organisation in order to evaluate

appropriately how that organisation is performing.

Purpose of Financial Statement Analysis

To evaluate an organisations

Financial performance

Financial position

Past performance

Present condition

Future performance

Earnings in terms of power, persistence, quality and growth

Solvency

Information for Analysis

The firms documents necessary to carryout comprehensive financial performance analysis of
the organization are as follow:

Firms Financial Statements

1. The Income Statement
2. The Balance Sheet
3. The Statement of Retained Earnings

4. The Statement of Changes in Financial Position

Changes in Working Capital Position

Changes in Cash Position
Changes in Overall Financial Position

5. Statement of Cash Flows

Conduct of Effective Financial Statement Analysis

To perform an effective financial statement analysis, you need to be aware of the

organisational factors such as:

business strategy

objectives

Annual report and other documents like articles about the organisation in
newspapers and business reviews.

Tools of Financial Statement Analysis:

The commonly used tools for financial statement analysis are:

Financial Ratio Analysis

Measurement of key relations between financial statement items.

Comparative financial statements analysis:

Horizontal analysis/Trend analysis is comparing a companys financial

condition and performance across time

Attributes of Trend
Analysis

Trend
percentage

Line-by-line item
analysis

Items are
expressed as a
percentage of a

base year

This is a time series analysis

For example: a line item could look at increase in sales turnover over a period
of 5 years to identify what the growth in sales is over this period.

Application of Horizontal Analysis

Comparative Statements

Vertical

analysis/Common size analysis/ Component Percentages is comparing a

companys financial condition and performance to a base amount.

Application of Vertical Analysis

Attributes of Vertical Analysis

All items are expressed as a percentage of a common base item within a

financial statement
e.g. Financial Performance sales is the base
e.g. Financial Position total assets is the base
Important analysis for comparative purposes
- Over time and
- For different sized enterprises

Common-Size Statements

Financial Ratio Analysis

Financial ratio analysis involves calculating and analysing ratios that use data from one,
two or more financial statements.

Ratio analysis also expresses relationships between different financial statements.

Financial Ratios can be classified into 5 main categories:

Profitability Ratios

Liquidity or Short-Term Solvency ratios

Asset Management or Activity Ratios

Financial Structure or Capitalization Ratios

Market Test Ratios

Method for calculating Profitability Ratios

Consider the following 3 elements of the profitability analysis:

Analysing on sales and trading margin that focuses on gross profit

Analysing on the control of expenses that focuses on net profit

Assessing the return on assets and return on equity

Formulae for calculation

Gross Profit % = Gross Profit * 100

Net Sales

Profit % = Net Profit after tax * 100

Net Sales

Or in some cases, firms use the net profit before tax figure. Firms have no control
over tax expense as they would have over other expenses.

 Net Profit % = Net Profit before tax *100

Net Sales
Or in some cases, firms use the net profit before tax figure. Firms have no control
over tax expense as they would have over other expenses.
Net Profit % = Net Profit before tax *100
Net Sales

Return on Assets =

Net Profit

* 100

Average Total Assets

Return on Equity =

Net Profit

*100

Average Total Equity

Method for calculating Liquidity or Short-Term Solvency ratios

Guidelines for short-term funds management

Working capital management is important as it signals the firms ability to meet

short term debt obligations.

For example: Current ratio

The ideal benchmark for the current ratio is $2:$1 where there are two dollars of
current assets (CA) to cover $1 of current liabilities (CL). The acceptable
benchmark is $1: $1 but a ratio below $1CA:$1CL represents liquidity riskiness
as there is insufficient current assets to cover $1 of current liabilities.

Formulae for calculation

Working Capital = Current assets Current Liabilities

Current Ratio =

Current Assets
Current Liabilities

Quick Ratio = Current Assets Inventory Prepayments

Current Liabilities Bank Overdraft

Method for calculating Asset Management or Activity Ratios

Efficiency of asset usage

How well assets are used to generate revenues (income) will impact on
the overall profitability of the business.

For example: Asset Turnover

This ratio represents the efficiency of asset usage to generate sales revenue.

Formulae for calculation

Asset Turnover =

Net Sales
Average Total Assets

Inventory Turnover =

Cost of Goods Sold

Average Ending Inventory

Average Collection Period = Average accounts Receivable

Average daily net credit sales*

*Note: Average daily net credit sales = net credit sales / 365

Method for calculating Financial Structure or Capitalization Ratios

Long term funds management

Measures the riskiness of business in terms of debt gearing.

For example: Debt/Equity

This ratio measures the relationship between debt and equity. A ratio of 1 indicates
that debt and equity funding are equal (i.e. there is $1 of debt to $1 of equity)
whereas a ratio of 1.5 indicates that there is higher debt gearing in the business (i.e.
there is $1.5 of debt to $1 of equity). This higher debt gearing is usually interpreted
as bringing in more financial risk for the business particularly if the business has
profitability or cash flow problems.
Formulae for calculation

Debt/Equity ratio = Debt / Equity

Debt/Total Assets ratio =

Debt

*100

Total Assets

Equity ratio =

Equity

*100

Total Assets

Times Interest Earned = Earnings before Interest and Tax

Interest

Method for calculating Market Test Ratios

Based on the share market's perception of the company.

For example: Price/Earnings ratio
Note: higher the ratio, the higher the perceived quality of the earnings by the share
market.

Formulae for calculation

Earnings per share =

Net Profit after tax

Number of issued ordinary shares

Dividends per share =

Dividends

Number of issued ordinary shares

Dividend payout ratio = Dividends per share *100

Earnings per share

Price Earnings ratio = Market price per share

Earnings per share

WORKED EXAMPLES
FOR
MEASURING FINANCIAL COMPANY PERFORMANCE

ANALYSING FINANCIAL STATEMENTS

 Decode messages built into financial statements and use them to tell the story
Time series analysis of ratios
Combine patterns of financial ratios
Compare cross-sectionally
Ratio analysis is only part of an investment appraisal process - also consider:

Non-financial performance indicators

Broader economic variables
Information about future economic variables

Information about future business plans, etc

Worked example (1)

Worked example (2)

Worked example (3)

Worked example (4)

Worked example (5)

Worked example (6)

Worked example (7)

Security management
Roles and Responsiblities of Securities;
1.
2.
3.
4.
5.
6.
7.
8.
9.

Entrance Control
All locks/anti-intrusion alarm/security devices are 24 hours well functioning
Periodic patrolling on the factory premises
Visitors Registration
Incoming Vehicles/Containers/Trucks Registration
Verifying Employees Identification
Unidentified/Illegal Object Inspection
To handle intruders or defenders
Awareness about Emergency (Fire, first Aid etc.)

Background Vertification to Securities

1. Factory has to verify the background/past history of the security candidates
2. No criminal records
3. Good physique
4. Holder of Security Guard Permit/Qualification
5. Passed the professional training for security guard

6. Employed by professional security companies or troops

7. Periodical on job training to strengthen the security awareness
Following Registers should be maintained by Security Gate:
Material Inward Register
Material Outward Register,
Material Outward Register (Returnable)
(Sl. No. Date, Material Name, Material From/To, Inovice No., Delivery Challan No.,
etc.)
Employee In-Out Register (Incase Less employee)
On-duty Register
Key Registers,
General Diary,
Vehicle Movement Register,
Visitors Register,
Other Unit or HO employees In-Out Register

You turn to Home Depots income statement and balance sheet, which are reproduced
in Tables 4.1 and 4.2. 1 At the end of 2009, the book value of Home Depots
equity was $19,393 million. Therefore, Home Depots market value added, the difference
between the market value of the firms shares and the amount of money that
shareholders have invested in the firm, was $48,623 2 $19,393 5 $29,230 million.

Income statement for Home Depot, 2009

The firms financial statements are therefore important diagnostic tools for the
informed manager.

To keep the discussion grounded, we will use the 1997-98 financial statement for
the Timberland Company as illustrations.

The Timberland Company, Balance Sheets ($ millions)

31/12/199
7
Assets
Cash and marketable securities
98.8
Accounts receivable
75.8
Inventories
142.6
Prepaid expenses and other current assets
24.9
Total current assets
342.1
Property, plant, and equipment
116.5
Less accumulated depreciation and
amortization
(63.6)
Net property, plant, and equipment
52.9
Intangible assets
20.9
Other assets
4.2
Total assets
$420.1
Liabilities and Shareholders' Equity
Accounts Payable
Wages payable
Income taxes payable
Other accrued expenses
Total current liabilities
Long-term debt
Deferred income taxes
Total liabilities
Common stock
Additional paid-in capital
Retained earnings
Less treasury stock
Total shareholders' equity
Total liabilities and shareholders' equity

20.4
28.2
17.7
32.8
99.1
100.0
6.0
205.1
0.1
68.6
146.3
(0.1)
214.9
$420.1

31/12/199
8

Change

151.9
79.0
131.2
25.4
387.5
131.2

53.1
3.2
(11.4)
0.5

(74.3)
56.9
19.2
5.8
$469.4

(10.7)
4.0
(1.7)
1.6

25.9
22.1
18.2
29.5
95.7
100.0
7.5
203.2
0.1
74.7
207.7
(16.3)
266.2
469.4

5.5
(6.1)
0.5
(3.3)

14.7

-1.5

51.3

7 Tricks For How To Learn Any Language In 7 Days (From

The Superpolyglot Twins Who Did It)
Do you really have to travel to another country to learn the language? The 10-language
twins undertook the challenge of learning a language in a week in Berlin, their city of
residence. What can we learn from how they learned?
Whats possible in a week? If you dedicated seven days to the achievement of one goal, how
ambitious could you make this goal? These were the questions that the multilingual twins
Matthew and Michael Youlden posed themselves when they determined to learn Turkish in
one week. They would attempt to liberate themselves from the distractions and
responsibilities of modern-day life in order to cram eight hours of study time into their
daily routine. Here are the seven things that I learned by observing some of the worlds
most capable language learners.
1. Get To Know Why
Lesson learned: Clearly define your goal at the very beginning and then plot a route towards
this goals achievement.
The twins set themselves the challenge of learning a language in a week in order to stretch
themselves, and then it was a question of choosing which language to learn. Turkish
presented itself as a natural option; there are nigh on 300,000 Turkish speakers in
Germanys capital, and the areas of Kreuzberg and Neuklln are dotted with stores
adorned with signs in Turkish. Truly understanding ones environment in these
neighbourhoods requires one to first understand Turkish.
2. Get Sticky
Lesson learned: Map and label your immediate environment in the new language from the
very first moment. Youll build and reinforce associations passively while going about your
daily life.
The first operational step in the twins learning process was to decorate the entire
apartment with sticky notes. This had an almost ceremonial touch to it as the twins delved
into dictionaries and proceeded to label everything with its corresponding Turkish name.
Within the space of about an hour it was impossible to carry out any menial task, be it
making a coffee or flicking off a light switch, without first being presented with at least
three different words related to this action.

3. Get A Partner
Lesson learned: There are few better motivations than a peer with the same goal. Whether
youre motivated by competition or a sense of mutual responsibility, the mere presence of a
learning partner is likely to exert just the right amount of pressure to keep you on track.
The importance of the other twins presence became immediately apparent as Matthew and
Michael delegated responsibilities for rooms to decorate with sticky notes. This simple task
was augmented by continuous little tests that they would spring on one another, and the
fact that they split up their day slightly differently and studied different topics meant that
each twin became a source of knowledge for the other; the question how do you say that
again? was met surprisingly often with an answer. The most extraordinary moment came
towards the end of the week when the twins simply switched their everyday conversations
to Turkish, asking one another if they wanted tea or coffee, were ready to cook dinner or
when they were going to leave the house the next day.
4. Prepare Mini-Motivations
Lesson learned: You need landmarks on your route towards your goal. These landmarks can
consist of small challenges - real life interactions in the language, for example - which force
you to prepare areas of vocabulary to overcome them. The gratification that will come with
their completion will serve to spur you on to ever greater heights.
Matthew and Michael had numerous micro-challenges throughout the week. On the first
day they were visited by a Turkish friend who greeted them in Turkish and complimented
them on how quickly theyd picked up their first words and phrases. They then learned the
names of fruits and the numbers from one to a billion so that they could visit the Turkish
market in Kreuzberg (although they refrained from purchasing nine hundred thousand
kumquats). Displaying their haul after their first functional exchange in Turkish, they
beamed with pride and a palpable sense of accomplishment before marching back home to
study further.
5. Eat The Language
Lesson learned: Find a way to tie everything you do to learning. Surround yourself with the
food, the music and the films, so that even in your downtime you can prime your mind
towards the language and perhaps trigger further areas of interest and motivation.
On our second visit to the brothers apartment 24 hours into the week, we found them
sampling dozens of different kinds of Turkish snacks. Like kids staring at the backs of
cereal packs before heading to school, the nutritional information and various special offers
and competitions on the packaging were analysed during snack breaks. There was no
moment of complete removal from the language learning process during the eight hours

that the twins had allotted to it. The intensity ebbed and flowed, but it never dissipated
entirely.
6. Use What You Already Know
Lesson learned: The greater the depth of processing, the more likely the information will be
remembered. Find pleasure in drawing parallels and making comparisons between the
language(s) you already know and your new language.
One of the twins most common phrases was, ah, thats a bit like in ? They were
constantly using their existing knowledge to support the ever-growing knowledge of
Turkish. Not only did this spark some energetic exchanges regarding the etymology of
various words, but it also ensured new words would never be forgotten once woven into
their web of associations. Even if you are learning your second language, you will likely
come across words that share common origins with words in your native tongue.
7. Variation is the spice of life
Lesson learned: So you have your route plotted and an idea of your favored methods, but do
remember to try new things; your new language has just as many sources as your native
language.
The twins spent a lot of time engrossed in books or on their computers and apps, flicking
and swiping their way through exercises eagerly, but at other times they were to be found
searching busily for Turkish radio stations and write-ups of Turkish football games on the
web. There is no definitive method to learn a language, nor any tool or teacher that will
single-handedly deliver you to the holy grail of fluency. Language is written, spoken, read
and heard. Each of these areas is considered a core skill within which there are myriad
potential inputs; would you restrict yourself to one in your native language? All too often,
people enter their weekly language class to converse with their teacher, but then barely
have any contact with other native speakers or the media being broadcast in their target
language. Try something new every day. Listen to a cheesy song, read a newspaper article
from a newspaper whose politics differ from your own, write a story for kids, attempt some
improvised theatre and talk to yourself while cooking. Spice it up and add some flavour to
your language learning!
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