DEANSPRESENTATION

K. Sona Camara Global Business Dr. Michael Onorato
Ranya K. Abdullah Team Presentation 4/22/2015
Andrew Chabra Team 4
1
Table of Contents
Facts About Denmark & Great Britain......................................................................................2
Research.............................................................................................................................................4
Cultural Aspect ................................................................................................................................5
Political/Legal System....................................................................................................................7
Business Laws & Labor Market...................................................................................................9
Taxing Environment.....................................................................................................................16
Trade in Dollars .............................................................................................................................21
Balance in Trade............................................................................................................................22
Trade Barriers.................................................................................................................................24
Danish Companies in the United States.................................................................................26
Maersk in the United States......................................................................................................27
LEGO in the United States..........................................................................................................29

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Facts About Denmark & Great Britain
Great Britain (England
and Wales)
Denmark
Population 63.742,977 5.569,077
Life expectancy 80.420 years 79.090 years
Capital London (7 421,210) Copenhagen(1,153.620)
Currency Pound Kroner
GDP pr. capita $37,300 US 37.800 US
Percentage of women in
parliament
19.6 % 38%
Unemployment rate 7.220 % 6.000 %
Head of state: Queen
Elizabeth II
Queen Margrethe II
Political system Constitutional monarchy * Constitutional monarchy *
Religions Christian 71.6%, Muslim
2,7%, Hindu 1 %, 1.6%,
Unspecified or 23,1%
Lutheran 95%, other
Christian 3%, muslim 2 %.
Languages English and Welsh (26 % is
welsh) Scottish from Gaelic
Danish, Faroese,
Greenlandic, German,
English is the predominant
second language
Exports Manufactured goods, fuels,
chemicals; Food, beverages,
tobacco.
Machinery and instruments,
meat and meat products
mostly pork, dairy
products, fish,
pharmaceuticals, furniture,
windmills.
External debt $9,577,000,000,000 $586,700,000,000
Location Western Europe (Show on Northern Europe also

3
the map) called Scandinavia
Area 243,610 sq km 43,094 sp km
Climate Temperate Temperate, humid and
overcast

4
Research
 Guideline from AAU.
o A source should be chosen by its:
 Credibility.
 Professional authority.
 Professional status.
 Explanatory power.
 Basis of explanation.
 Consistency of the analysis.
 Objectivity of the source.
 Simultaneity and timeliness of the source.
 The relationship between the source and other sources.
 Qualitative Research.
o Is based on description, meaning articles, etc., information based on
words.
 Quantitative Research.
o Is based on measurements as statistics. The one thing that differentiates
qualitative research from quantitative research is that quantitative research
is more predictable.

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Cultural Aspect
 Geert Hofstede’s Four Cultural Dimensions.
o Power Distance.
 Describes the degree to which people in a country accept that
power in institutions and organizations is distributed unequally. A
high rating on power distance means that large inequalities of
power and wealth exist and are tolerated in the culture, and is a
class or caste system that discourages upward distance rating
characterized societies that stress equality and opportunity.
 Denmark: 18.
 United States: 40.
 Great Britain: 35
o Individualism vs. Collectivism.
 Individualism is the degree to which people prefer to act as
individuals rather than as members of groups and believe in
individual rights above all else. Collectivism emphasizes a tight
social framework in which people expect others in groups of which
they are a part to look after them and protect them.
 Denmark: 74.
 Great Britain: 89.
o Uncertainty Avoidance.
 The degree to which people in a country prefer structured stations
defines their uncertainty avoidance. In cultures that score high on
uncertainty and ambiguity and use laws and controls to reduce
uncertainty. People in cultures low on uncertainty avoidance are

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more accepting of ambiguity, are less rule oriented, take more risks,
and more readily accept change.
 Denmark: 25.
o Masculinity vs. Femininity.
 Masculinity is the degree to which the culture favors traditional
masculine roles such as achievement, power, and control, as
opposed to viewing men and women as equals. A high masculinity
rating indicates the culture has separate roles for men and women,
with men dominating the society. A high femininity routing means
the culture sees little differentiation between male and female and
treats women as the equals of men in all aspects.
 Denmark: 16.

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Political/Legal System
 Denmark.
o Constitutional Monarchy; is a form of monarchy where the governing
powers of the monarch are restricted by the terms of a constitution.
o Multi-party structure; several parties under one government.
o The Constitutional Act; rules, laws and right of the Danes.
o Civil Law; its core principles are cofidied into a referable system which
serves as the primary source of law.
 United States.
o Federal Presidental Constitutional Republic; a state where sovereignity
rests with the people or their representatives rather than with a Monarch
or emperior, a country with no monarchy. There is division of powers
bertween the federal government and government of the individual
subdivisions. In US, the division of powers is codified between orders of
government in a written constitutional document.
o Bill of Rights; is the collective name for the first 10 amendments.
o Common Law; is law developed by judges through decisions of courts
and similar tribunals that decide individual cases, as opposed to statues
adopted thorugh the legistlative process or regulations issued by the
executive branch.
 Great Britain.
o Constitutional Monarchy; is a form of monarchy where the governing
powers of the monarch are restricted by the terms of a constitution.
o Common Law; is law developed by judges through decisions of courts
and similar tribunals that decide individual cases, as opposed to statues
adopted thorugh the legistlative process or regulations issued by the
executive branch.

8

9
Business Laws & Labor Market
Denmark.
o Companies can benefit from an easy plug ’n ‘ play registration and can be
ready to do business within few hours.
o Cost-and tax efficient.
Key advantages when setting up a business in Denmark:
 Quick, informal and cost –efficient establishment procedures.
 Online registration.
o Quick.
o Ready to do business within few hours.
 No resident requirement for management.
o CEO.
o Board of directors.
o Allow the company to be global.
 Danish Company laws are in conformity with the EU legislation.
Manufacturing and service business in Denmark.
 Is often done by establishing a Danish company (A/S or ApS).
o This lets the company to acquire or lease such facilities.
o When doing service businesses it may be conducted through a
distribution center, regional headquarters, and such.
The Danish labor market.
 In Denmark, pay and working conditions are typically laid down by collective
agreements between trade unions and employers' organizations.
o The top two flexible labor market in Europe.
 Mostly when it comes to salary levels.

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 Among most productive in Europe.
 No restrictions apply regarding overtime work, which allows
companies to operate 24/7, 365 days year.
 Most flexible working hours in Europe.
 Flexible labor market.
 Competitive overall labor cost level.
o Even though the wages are high, the labor costs are still competitive due
to the low costs of social security, labor taxes etc.
o Denmark offers high social security for people who get sick or lose their
job.
o The employer’s contribution to the social security is minimal.
 Highly motivated productive workforce.
o Highly educated highly educated.
o Excellent foreign language skills.
o Highly motivated.
o Employers are self-critical and focus on commitment and improvement.
o 80% of the Danish workforce speak English, 53% German & 11% French
Great Britain
3 types of business.
 Sole trader.
o If you work for yourself.
o Run the business as an individual.
o Keep all the business’s profits after tax.
o Tax.
 Self-assessment.

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 Income tax.
 National insurance.
 Pay VAT.
 Limited company.
o An organization that runs the business.
o It has its own rights for everything it does.
o Finances are separate from your own.
o Share profit after paying corporation tax.
o Many legal responsibilities.
 Report everything.
 Keep hold of everything that happens in the business. Financial
and accounting records.
 If any changes occur, it should be reported to someone.
o Two types of companies.
 Limited by shares.
 The shareholders responsibilities for the company’s financial
liabilities are limited to the value of shares they own but
have not paid for.
 Private company limited by guarantee.
 If anything goes wrong, the Directors or shareholders
financially back up the company.
 Public limited company.
 The company’s shares are traded publicly on the market as
stocks.
o Tax responsibilities.
 Statutory accounts.

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 Company tax return.
The director must.
 Fill in a self-assessment tax return.
 Pay tax and national insurance.
 Ordinary business partnership
o Partners share responsibility for the business.
o Share all the profit.
o Each partner pays tax on his or her share of the profit.
o Responsible for the losses.
o A limited company can also be a partner.
o Tax.
 Personal self-assessment tax return.
 Income tax.
 National insurance.
Labor (numbers from January)
 30,94 million people in work.
o 143,000 more than August.
o 617,000 more than a year earlier.
 Employment rate in age.
o 73,3% highest since 1971.
 Unemployment rate.
o 1.86 million unemployed people.
o 479,000 fewer than a year earlier.
 Comparing the three months end of January 2015 with a year earlier, pay for
employees in Great Britain increased by 1.8%.

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 Immigrants
o Skill of existing workers and immigrants.
The United States
4 major factors
 Environmental regulations
o Environmental Protection Agency (EPA) together with the state
environmental agencies regulate the impact on businesses on the
environment.
o Implement environmental laws passed by congress.
o Many permits.
 Clean Air Act Permits.
 Endangered species.
 Wetlands.
 Finance Law.
o Ensures fair competition and protect the financial interest of companies.
o Antitrust law.
 Best goods and services for the best price.
 Against fix prices.
o Bankruptcy law.
 Those who cannot afford to pay back their creditors often look to
filing bankruptcy to settle their debt.
 How much a creditor can collect depends on how this business is
regulated.
 Prevents creditors to declare bankruptcy on a business.
 Advertising law

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o Success depends on your marketing abilities with following components.
 Market research.
 Pricing.
 Advertising.
 Packaging and labeling.
 Distribution.
 Customer service.
o Unfair, untruthful or purposely deceptive advertising can result in costly
penalties.
 Online business
o Good to expand business and increase sales.
o Regulations apply mostly for online retailers and others that collect
consumer data.
o The Federal Trade Commission (FTC) Agency that regulates e-commerce.
o Protect your costumers’ privacy.
 Personal information.
 Credit card information.
 High risk of legal problems.
 Identity theft.
US Labor Market
March 2015
 Labor force: 156,906.
o 2014: 156,180.
 Employed: 148,331.
o  2014: 145,796.

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 Unemployed: 8,575.
o 2014: 10,384.
 Unemployment rate: 5.5.
o  2014: 6.6.

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Taxing Environment
 Denmark.
o The Danish welfare system is based on a concept based on citizens
having equal access to the different services paid by taxes. The tax rate is
one of the highest in the world, due to Denmark having a large public
sector. Everyone must help with unemployment and illness. All children
must attend school and have the opportunity to get an education- All
citizens must have access to library and media.
o There are two kinds of tax, direct- and indirect tax.
 Direct tax:
 A-tax (Deducted from income at source).
o Deducted directly from your income.
o It is collected during the year by your employer, pension
provider, ect.
o The amount withdrawn is paid to SKAT as provisional tax.
o At the end of the year, a calculation is made to determine
whether the amount paid is more or less than the tax
payable for the whole year.
 B-tax(Tax not deducted from income at source).
 State tax.
o Some of the tax you pay from your income goes to the
state and are the same wherever you live in the country.
 Municipal tax.
o Every citizen has to pay to their municipality and is a
percentage of their income.
o Your total tax contribution will therefore depend on the
municipality that you live.

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 Health contributions.
o Health contributions are a state income tax that everyone
who has a taxable income has to pay.
o It is deducted by your gross pay.
 Church tax.
 Labor market contributions.
o All working citizen must contribute and your employer
will deduct the contribution from your pay.
o The contribution goes to the government’s labor market
expenses to cover unemployment benefits, supplementary
training courses, and maternity.
 ATP contributions.
o Everyone who works must pay to the Danish labor market
supplementary pension fund (ATP).
 Property value tax based on the public property assessment.
 Property tax (Land tax).
 Indirect tax.
 VAT.
 The VAT is included in the price of nearly all goods.
 Green Taxes.
 Green taxes are taxes that you pay for spending society's
resources. The more resources you spend, the more
green taxes you must pay. For example, green taxes are
levied on petrol, oil, electricity, water, and waste. This
means that the price of these resources increase, which is

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the intention. If the price of petrol increases, people will
do less driving which will limit the impact on the
environment.
 Excise duties
 Excise duties are levied on the import, manufacture, and
sale of certain goods. When you buy an article at a shop,
the excise duty has already been paid, so as an ordinary
customer you do not have to worry about this.
 Customs duties
 Customs duty is a tax, which you pay to the state. If you
have travelled to a non-EU country and bought goods
that you are bringing back to Denmark, you may have to
pay customs duties.
 Great Britain
o The taxation involve a minimum of two different levels of government:
The central government that includes Her Majesty’s revenue and
government, which comes primarily from income tax, national insurance
contributions, value added tax, corporation tax and fuel duty. Then there
is the local government, which covers local government revenues and
come primarily from government funds, business rates, and council tax.
o Your yearly income tax depends on:
 How much of your income is above your Personal allowance.
 Limit is £10,600, which is the amount you do not have to pay tax on.
 How much of this falls within each tax band.

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 United States.
o The tax system in the United States is both on a Federal and state level.
Federal and state taxes are separate and have their separate authority to
charge taxes. The federal government does not have the authority to
interfere with state taxation. Each state has their own tax system and is
different from other states.
o Income tax.
 The most known form of taxation.
 If you have an income, a deduction is shown on your paycheck.
 If you have an income, you have to pay income tax on the federal
and state level.
 Federal tax covers social security and FICA, and each states have
their own form of income tax that they hold back from your
paycheck.
 If you earn more than $6,750 you have to file taxes to both federal
and state before April 15th.
o Sales Tax.

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 Sales taxes are charged on your purchase.
 Sales tax is a state tax and varies from state to state as within the
state.
 E.g. NY sales tax is 7%, NJ 3 %, Albany 8%, and Syracuse 7%.
o The municipalities have the authority to raise the sales tax above the state
limit.

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Trade in Dollars
 The United Sates has the highest corporate income tax rate in the industrialized
world.
o United Kingdom: 23 %.
o Denmark: 25 %.
o United States: 39,1 %.

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Balance in Trade
 Import and Export.
Great Britain Denmark US
Top 5 products
exported
Cars (8, 2%),
Refined petroleum
(6, 9%), Crude
petroleum (5, 6),
packaged
medicaments (5,
1%), Gas turbines
(3, 3%)
Packaged
medicaments (8.4
%), Refined
petroleum (5.0 %),
Crude petroleum
(4.7%), Pig meat
(3.6%), Human or
animal blood (1,9 )
Cars (4.4 %), Refined
petroleum (4.2%),
Planes, helicopters,
and spacecraft(3.2),
packaged
medicaments (3.1)
and gas turbines(2.4)
Top 5 products
imported
Crude petroleum (7,
2%), Cars (5, 8%),
Refined petroleum
(4, 6%), Packaged
medicaments (2,
7%), and computers
(2.6%)
Refined petroleum
(5.8%), Cars (3.4%),
crude petroleum
(3.0%) and
computers (2.8%)
Cars(8.3%),
Computers(5.4%),
crude petroleum
(5.3%)Packaged
medicaments(2.6%)
broadcasting
equipment
Top 5 export
destinations
United States (12%),
Germany (11%),
Netherlands (7,6 %),
France (6.9 %),
Belgium-
Luxembourg (5.5%)
Sweden (13%),
Germany (13%),
United Kingdom (9,
4%), United States
(7, 6%), Norway (5,6
%)
Canada (13%),
Mexico (11%), China
(9,3%), Japan (5,5%),
Germany (4,9%)
Top 5 import
origins
Germany (13%),
China (8, 7 %),
Netherlands (7, 5%),
United States (7,
Germany (20%),
Sweden (12%),
Nederland’s (7, 3%),
Norway (6.9 %),
China (22%), Mexico
(14%), Canada
(9,8%), Japan (7,8%),
Germany(6,0%)

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0%), France (5, 7%) China 6, 9 (6, 9 %)

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Trade Barriers
 Health Legislations – EU.
o Good health is a major concern of European citizens. The European Union
(EU) works for better health protection through its policies and activities,
in accordance with Article 168 of the Treaty on the Functioning of the
European Union. EU action on health issues aims to improve public
health, prevent diseases and threats to health (including those related to
lifestyle), as well as to promote research. The EU does not define health
policies, nor the organization and provision of health services and medical
care. Instead, its action serves to complement national policies and to
support cooperation between member countries in the field of public
health.
 Example: McDonald’s.
o Repeatedly, we find that processed foods—which are bad enough even
without added chemicals—contain far more hazardous ingredients in the
US compared to other nations, most notably Europe. In fact, many of the
foods Americans eat on a regular basis are banned in other countries.
McDonald's French fries sold in the UK contain far fewer ingredients,
which is typically a hallmark of a healthier product. For starters, in the US,
McDonald's French fries are made with potatoes cooked in hydrogenated
canola and/or soybean oil—two of the worst cooking oils you can use;
both of which are also in all likelihood the genetically engineered
varieties. American fries also contain TBHQ; antifoaming agents,
preservatives, and color stabilizers. For some reason, American French fries
also contain beef flavor, made with wheat and milk derivatives. As a result,
they carry an allergy warning for those with wheat and dairy sensitivities.
French fries sold in the UK consist of potatoes cooked in non-
hydrogenated sunflower or rapeseed oil, and nothing else. Salt is added

25
after cooking. Realize that both of these oils aren't great as they are both
high omega 6 oils that become oxidized to cyclic aldehydes and the
rapeseed is GMO. The antifoaming agent dimethylpolysiloxane, found in
the American version of McDonald's French fries, is a type of silicone with
anti-foaming properties used in cosmetics and a variety of other goods
like Silly Putty.

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Danish Companies in the United States
 Denmark boasts one of the highest wages for fast food workers in the world.
Unions secured a collective bargaining agreement with McDonald's in 1989 that
has allowed workers to negotiate pay ever since, and all workers currently make
about $21 per hour in U.S. dollars. By comparison, she said, most workers are
unmarried teenagers in Denmark. In the U.S., the median age of fast food
workers is 29, more than 36 percent of workers over 20 years old have children
and roughly 20 percent live below the federal poverty line.
 Wages, salaries, social security contributions, paid annual leave and sick leave,
bonuses and non-monetary employee benefits are accrued in the year in which
the associated services are rendered by the employees of the LEGO Group.
Where the LEGO Group provides long-term employee benefits, the costs are
accumulated to match the rendering of the services by the employees
concerned.

27
Maersk in the United States
 Maersk Group has strong ties to Denmark, employing more than 6,000 people
full time and with 43% of the fleet under the Danish flag. It is also one of the
largest tax contributors in its home country, paying DKK 6.2 billion in Denmark
in 2013, the majority related to North Sea oil and gas operations, and
representing about a third of the Group’s global bill, according to Maersk data.
In numbers, the Maersk Group contributed 2.5% of the country’s total gross
domestic product in 2012, according to data compiled by the research company
Last Mile and based on information from Statistics Denmark and Maersk. This
equates to the cost of the Fehmarn tunnel that will link Denmark to Germany
under the Baltic Sea.
 Foreign trade and energy have boosted economies throughout the Americas,
one of the world’s major growth regions. From the USA, to Argentina, Ecuador
and the Bahamas, Maersk is helping unleash the region’s potential by harvesting
offshore energy resources and facilitating the flow of goods around the globe.
We market our services through the Maersk Line, Safmarine and SeaLand (Intra-
Americas) brands.
 Trade.
o Unlock growth for society and Maersk by improving conditions for
businesses and industries to participate in global trade.
 The challenge.
o Various obstacles continue to hamper trade. Lack of infrastructure,
corruption, burdensome documentation processes, supply chain
inefficiencies, lack of logistics know-how to mention just a few. What
these issues all have in common is that they make trade much more
expensive and difficult than it should be.

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 Response.
o Reducing external barriers to trade
 Benefits for society.
o Continuous trade expansion and access to global markets can help
generate economic development, stimulate job creation, increase people’s
income, and raise living standards. This is beneficial especially in growth
markets where the cost of logistics may be twice as high compared to
mature markets.
 Benefits for Maersk.
o We have a vested interest in seeing trade growing and countries
prospering from increased exports and imports. By taking an active role in
addressing trade barriers, we aim to be the chosen transport and logistics
provider facilitating the increased trade growth and in that way develop
profitable markets.

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LEGO in the United States
 The LEGO Group is a privately held company based in Billund, Denmark. It has
come a long way over the past almost 80 years – from a small carpenter’s
workshop to a modern, global enterprise that is now one o the world’s largest
manufacturer of toys.
LEGO was established in England in 1959 and in the US in 1973.
In 2014, the largest market was the US and UK, which grew double digit.
 Foreign currency transactions are translated into the functional currency using
the exchange rates prevailing at the dates of the transactions. Foreign exchange
gains and losses resulting from the settlement of such transactions and from the
translation out balance sheet date exchange rates of monetary assets and
liabilities denominated in foreign currencies are recognized in the income
statement, except when deferred in equity as reserve for exchange rate
adjustments.
 The results and financial position of subsidiaries that have a functional
currency different from the presentation currency are translated into the
presentation currency as follows.
o Assets and liabilities for each subsidiary are translated into DKK at the
closing rate at the balance sheet date.
o Income and expenses for each subsidiary are translated at average
exchange rates.
o Differences deriving from translation of the foreign subsidiaries opening
equity to the exchange rates prevailing at the balance sheet date, and
differences owing to the translation of the income statements of the
foreign subsidiaries from average exchange rates to balance sheet date
exchange rates are recognized in other comprehensive income and
classified as a separate reserve for exchange adjustments under equity.
o Production costs comprise costs incurred to achieve revenue for the year.
Costs comprise raw materials, consumables, direct labor costs and indirect

30
production costs such as maintenance and depreciation, etc.  
o The tax expenses for the period comprise current and deferred tax. Tax is
recognized in the income statement, except to the extent that it relates to
items recognized in other comprehensive income. In this case, the tax is
also recognized in other comprehensive income.
 Foreign exchange risk.
o The LEGO Group has significant net inflows in EUR, USD and GBP, while
CZK, HUF and MXN account for the most significant exposure on the
outflow side. The LEGO Group’s foreign exchange risk is man-  aged
centrally based on a foreign exchange policy approved by the Board of
Directors. Forward contracts and options are used to cover purchases and
sales in foreign currencies. These forward contracts are classified as
hedging and meet the accounting requirements for hedging of future
cash flows.

DEANSPRESENTATION

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