Good afternoon, ladies and gentlemen. First of all, a big thank you to Anurag. And you know, it was sort of for the introduction he gave. I don't know whether I deserve even half of that. I must say that I am in his land and inspired by him. You can see what I'm wearing.  So thank you once again for inviting me. Thank you to Anurag, Ravel. Everyone at E4M and all of you ladies and gentlemen. It's indeed my pleasure to be with you and to talk on this topic harmonizing chaos in the new world order. First of all, it is always a pleasure to be amongst marketeers because as some of you or many of you may know, that I started out as a marketeer of sales and marketing are my core areas of expertise before I jumped into general management. So I have always cherished marketing. I think it is one of the very tough assignments and a tough role because it has its campaign compasses both hard and soft. And there are issues that you need to tackle at both levels and therefore that makes it that much more challenging. And indeed my pleasure. On the topic of harmonizing chaos in a new world order. So I was reflecting on the topic and I was thinking about it as to what do I talk and what do I leave behind with you. First of all, let me be very, very clear and give you the caveat that I am no expert at the new world order. And everything which I tell you may or may not turn out to be true on how to harmonize chaos in the new world order. I will however try to do is to share my perspective, share some of my reflections of having come thus far but trying to look into the future a little bit and where. And then hopefully leave you with some thought-provoking ideas and something which you can work on and then maybe practice. So I think that is indeed the attempt. So reflect talking about harmonizing chaos in a new world order. The words that stand out for me most are new world order because chaos, disruption, harmonization are things we've been talking about for quite some time. I think the thing which is very dynamic and which needs to be pondered upon and thought upon is this phrase called new world order. So what is this new world order? Is the new world more equal? Is the new world more open? Is the new world more democratic? Or is the new world about technology? Is the new world about energy? So there are many dimensions to each of these things which we talk about and when we think of. And then I can keep going on and talking about each of these and then I could take a lot of time trying to talk to you about what are the various aspects of the new world. But I thought in the interest of time there are three things that I'm going to focus on within that. Maybe ponder on one a little bit more than the other three as well. So the new world is definitely about technology. And I think it is, Anurag spoke about the entire piece and you guys are going to talk a lot about digital and about technology. So I think it is indeed about technology. So the new world is about technology. Technology and digital is transforming everything which we do in every sphere of life in ways which we've not known at least at which we have not fathomed or thought of in the past. The other piece which is also there is this thing about energy. And I think energy or the flip side of the coin is sustainability is something which is more recent but very pertinent and indeed something which we cannot ignore. So are we therefore leaving behind sustainable, do we have sustainable solutions and I mean I know I do believe behind earth for our children in the condition in which we had inherited it from our parents. And I think to that extent sustainability and energy being a very important component to sustainability is important. And I think these are the two aspects which are relevant and I will touch on them a bit. The third piece which however I wanted to talk about and pick up with you is the area of equality. And therefore are we, in the new world order are we more equal or the other way round? And I think to me this is a very singular most important thing which will define arguably is already defining the world order. And I will use the phrase inequality. And as you may know, for some of you in the audience you may have read Thomas Piketty and his seminal work about 2014-15 on capitalism in the 21st century where he talked about how everything which is being shaped around us is because of inequality. And his argument that he basically this is going to continue to define there were a lot of critics of him at that point in time many economists disagreed with him. But I think the relevance of that cannot be more than what it is today in our society. And to me therefore Thomas Piketty's thinking on inequality is something which sort of continues to resonate. And I was thinking about inequality not only from the facts of the piece which is inequality but also coming now as I'm not rightly pointed out as sort of you know seven years in media I have to think about inequality but not only the facts of inequality but the perception of inequality. And to me the perception of inequality is equally if not more important than the facts of inequality. And this is for all of us as marketeers in this room we understand it is about what we do the changes which we bring about the facts of it but the perception of it that is equally important particularly in this profession and our ability to drive this. And reflecting on this concept of inequality I wanted to bring around three or four examples from around the world one closer home but these examples are trying to tell you how inequality and the perception of inequality is shilling everything which we are doing. Let me first pick up the example of Brexit. So if you look at Brexit what is behind, what is the seminal thing behind Brexit? In my opinion of course there are several factors and there is a lot which has been written about by experts on why Brexit happened and what has happened and all that but if I was to simplify it and condensate it and see that it is one thing which is important which has been there is inequality. And as you know Britain amongst developed world is one of the most unequal it is the nation which has highest inequality. So therefore and then if you go by statistics 10% of Britain's actually own 31% and the country's wealth in a developed world context that is 25 and I think that had a very important role to play. But to be honest with you this is not new. This indeed has not been for 25 odd years it is the same for close to about 25 years and if at all close to the financial crisis of 2008 that has changed a bit in favor of making it less and equal because the losses have been more to the one for a lot of wealth at that point in time. The perception of it and the reason that our jobs are being taken away by people who are moving to the European Union and that that something needs to be done about it in society becoming more unfeasible and I don't get the opportunities which I deserve. That one single driving force let you watch it happen. The second one, closer home let me talk about and this time flipping it around the other way round let me talk about UB elections and demonetization. If you look at the thought behind demonetization one of the argument for demonetization was also to tackle the so-called inequality and to try and bring in some kind of quality and give it an opportunity and try and change make it more transparent and then move into demonetization and that piece happened. It did have an impact on the vast, the way BJP swept the elections in UB and the reason for that simply was that I may have lost a vote but the others have lost a lot of doubts and I think this is very, very important for human psychology and I think everyone in the rich fashion which can then follow up from there may reach to a perception that they do know that they're with you, which with this I can suddenly stand around inequality and you're trying to play the other way round. If you look at closer home to the corporate world in the corporate scenario, I think, I don't know whether some of you followed in one of the latest statements given by Jeff Azores. He talked about making the daily wage $15 per hour in Hanzo and saying that can all the other retailers follow and I think that was the thing which is to say that we will be offering $15 per hour they keep raising the bar in a manner of speaking in the context of United States and then saying challenging can others follow and where did that stem from? That again stems from the growing perception of inequality and trying to give that basically that specific thing that we'll try and make it equal. And I think this, therefore, is the most defining thing for the new world order. Closer home in India, again, I'll tell you, we've gone, we've sort of swung a bit on this but if you look at, if you look, if you want to go back and some of you in the room will definitely resonate with this because I'm not my friend and some of you others will be. If you were to look at 391 India, I think there was a complete, some kind of a taboo to constrictors' consumption. I think it was a different society. There were also far less choice available to people, the kind of things which were there, there were cues for everything which you needed to go in for, whether even for buying scooters or going for telephones and so on and so forth. Of course that was the opening of a 391. Things have changed quite a lot. Things have changed and the amount of choices available is the things which can basically move on and the thinking about amongst people's consumption is totally gone. So basically if you have it, you've gone. I think it's the new mantra. I mean the mantra which is actually being followed and basically which is the classic taboo that the mantra will be followed. But once again, the question which will be, which is ultimately beginning to get raised in our country and will be raised as we go forward is the same thing on inequality. What are we doing about inequality? What is it that we can do to address this? And if you again go by statistics here, by the way, while we are now plotting a lot of this, imagining a lot of things, a lot of choices available to us, the question to ask is, has inequality come down or gone up? And if at all, if you look at it, if you again go by promising research on India this time around. So in 1980s, the 10 percent of Indian population used to be owning about 45 percent of the wealth. That number, 10 percent of Indian population now owns to 68 percent of the wealth of the country. So if at all, it has gone for broader works. Now if this is indeed the way the tide is growing and broadly if you look at these are the three things in the new world order which we as Mark here should be cognizant of, one is technology and I'm sure you guys will have a lot of debate on that. The second is energy or sustainability if I was to use the broader word. And finally this theme around inequality and opportunity, this is the case, what we should be at Mark here. And at this stage, I would like to quote from Jimmy D. A clean American singer, actor, businessman, and TV anchor, and some of you know him. And I quote, saying, I can't change the direction to win, but I can adjust my stage to always reach my destination. So to you, this is the place I want to leave you as Mark here, that you know, we can't change the direction of the win. The direction of the win is the direction of the win. But we've got to go to a particular destination. We are motoring our brands, our organization in a different form and we adjust the stage to always reach that destination. Now the answer is not very easy and I will definitely not repent that I have the answer. But what I want to leave you with is a very simplistic thought or a rather simplistic thought and an idea, if I could say, a kernel on what we could do to tackle it, to tackle the three broad phenomena. And I think, fortunately, they tackle for this particular one thought, which I will leave you with, tackles the three big phenomena in the new world order. And that, ladies and gentlemen, the phrase is shared. It is an old world phrase and I think I want to take on from where I run ahead by doing his last two slides. It's an old world phrase, something which we've grown up with. You know, as we talk to our children and we talk about sharing, our parents have got a share, basically talked a lot about sharing. As a society, India, and particularly Asia, and arguably the human kind, sharing is an important virtue. But somehow when we come to profits, when we come to jobs, this is something we just forget, when we come to professions, there isn't a new one shared.  You don't want to share. But in the new world order, ladies and gentlemen, I think sharing will have an important role to play. And let me give you, now sign off with a few examples. And I'll give you a few examples, these are top of mind examples. They're not exhaustive, these are things which I have sort of, either experienced, touched, or thought of, and I'll share some of them with you. So let me first talk from the point of view of sustainability. But if you look at top of sustainability, one of the big successes in Unilever as a brand has been lifted. And one of the things which Lipton has consistently done for India and Europe is the reindeer or porous alliance in Kenya with the farmers and the entire emphasis on sustainable farming and being able to say that. That has helped the brand to grow. So I think your ability to therefore be able to do the two course hand in hand. And contrary as it may seem, I think ability to adapt those sustainable solutions, share them upfront with your consumers or customers and talk about this, bring that conversation into the society is good for the brand. It's good for the brand for building the equity of the brand, it's good for the brand for building the nature and spice of the brand and it's definitely very good for the business. Let me give you the second example on technology. And I can't stay with the theme of share. And I think this in the context of organizations into partnerships. I think that's how you would care when you have partnerships. And let me give you example of something closer home at Y-Com in India. And let me talk to you about something which we did three years ago when we launched food. When we launched food, as many of you may know, we are a media organization, we are story tellers. What is in the heart of our organization is content. We understand as an organization in general, very little of content, very little of technology, sorry. Very little of engineering, very little of product. And everybody, basically when we went about doing food, we partnered with 42 partners, 42 partners to launch food. And most people turn around, including some people very close to us, including people who are kind to us, some people who I work with very close, they said this will collapse. There is no way you can partner with 42 people. You have no clue what you're getting into. You have no idea. Your people don't know anything about it, and it won't work. In Sha Allah, let me tell you, three years out, we are now close to about 150 million costs download, but more importantly, 50 million, 55 million now, close to 25 million monthly active users. And in the last financial year, we delivered 100 million video minutes on the platform. So about technology, my answer to many of you is, we won't learn it overnight. We won't become experts on it overnight. But do we need to embrace it? The answer is yes. Is it redefining the new world order in which we are saying the answer is yes? How do we then tackle it? The answer is simple, which I want to do with again. It's about factor, about sharing. And the new world is a lot about factor. And I think about sharing. So I think that's the second key. And thirdly, talking about inequality, let me share with you a few examples of that as well, which is I think at the core of everything. So there is this company, which is, I've always thought about food companies in general. And I've always thought that what if all food organizations and food brands were to dedicate a very small fraction of consumer spending in order to tackle malnutrition? You see, malnutrition is a reality and it's something which is shared as in the face. And it's a part of some level of inequality in society in the way in which we live. If all organizations, all food organizations, particularly, could actually dedicate a small part of it, wouldn't that be wonderful? And as we speak, there is a speciality retailer which some of you may know by the name of Boxlunch. Boxlunch dedicate one free meal for every $10 spent at the retailer. For every $10 spent at the retailer, one free meal is provided by Boxlunch. How's that? I think that is absolutely wonderful. I think that is something which is emollently doable. But if you look at, again, the other dimension of inequality which we tackle, which is a very, very strong and hard to make today, and I see a lot of ladies here sitting in the room, is about gender disparity in pink. And I think the argument is that how do we tackle this? Because we've got to tackle it with, I think, the meditocracy in that. That is indeed true. We have to keep meditocracy in that. We cannot allow meditocracy to be compromised to run efficient organizations, efficient corporations, arguably, you know, well-covered countries. So I think in that context, how do we go about doing this? Again, a lot of experiments about things which are happening. It is pertinent for us to be able to do some of these things. The work which is happening in two games of scale in this area is very good. Being done by such a company. I think the other thing which we will need to continue to reflect on is how do we share value across an organization, across different levels of an organization to tackle inequality? I think this is a very pertinent question, and a question which will be easily addressed by us as a society and by all of us as marketing companies. And finally, when it comes to sharing, I want to leave you, and from a point of view of inequality, or rather bringing some kind of equality, I want to leave you with the thought, last thought from my end, on inverting the pyramid. We have always stayed with a concept of a pyramid where as you rise higher, you think that people are mobile, you think people have more answers, people have more solutions, and then that's how we reward them, and that's how organizations are structured, that's how governments and other places are structured. How are we going to do that in today's day and age? And I do not want to leave you with a small, but a very interesting example, something which I have shared in the past as well, but I have no hesitation in sharing. Once again, from a digital business, when we were wanted to name the business, which is basically now called Moot, in the naming of the business, we did not talk to the most whites, we did not talk to the conventional people, we opened it up to proud people. And when we opened, and we opened it up out far and wide, and when we opened, the person who got the name was actually a 22-year-old, six-month intern at Bicom-18, for a princely award of her round trip anywhere to the world with the name Moot.  Some of us didn't even know about it. So my idea in the end is to leave you with this seminal thought as you progress today and then make up in your careers and in your life, is keep on reflecting on the word sharing. Sometimes it also means part learning or part sharing. I think that could help us to address the question on how do we bring, basically, how do we have, you know, harmonizing chaos in a new world order. And I think if we were to attempt to harmonize chaos in a new world order, I think we could start with a simple thought of sharing. Thank you, ladies and gentlemen. Thank you for your time. Thank you for giving me this opportunity.


This audio lecture is brought to you by the YouTube channel Farhat Accounting Lectures. On my YouTube channel you can find over 1500 free accounting, auditing and tax lectures to prepare for your CPA exam. Those audio lectures are designed for people on the go, for busy people, people who are commuting on the plane, on the train or if you are spending some time in the gym or walking in the park or even trying to go to sleep. So they are designed to review the material for the exam. If you really want to learn the material in depth, please visit my YouTube channel and if you happen to visit my YouTube channel, please consider making a donation to support the channel. I'm here to help you, let's get started. This audio file can be downloaded from my website, farhatlectures.com. In this audio lecture we would look at the operating cash flow statement using the direct method. In the prior session I looked at the indirect method, this is going to be the direct method. Remember the indirect method is a reconciliation process, it starts with net income and it works backward. Now we are going to look at the direct method. The direct method is a little bit different. The direct method is directly converting each line on the income statement to cash. So rather than starting with net income and going backward, so rather than starting from the bottom and adjusting, we are going to start from the top, we are going to start from revenues and going down, converting each line into cash. Converting each line into cash. Now if you happen to prepare, if a company happened to prepare the cash flow statement using the direct method, they still have to prepare the indirect method in the notes. Therefore the reconciliation process will have to be done regardless whether you prepare the direct or the indirect because with the direct method you still have to prepare the reconciliation. Let's start with the direct method. As I said, the direct method is going through each line and converting each line into cash. So the best way to do it is kind of close your eyes and think about the income statement. What's the first line on the income statement? Sales or sales revenue. Some sort of revenue. Now I'm going to go over the concept for revenues and they apply to all revenues, whether you have sales revenue, dividend revenue, interest revenue, rental revenue, they all apply the same concept. So you're starting with sales revenue. Let's for the sake of illustration, let's assume your sales revenue is $780,000. That's an accrual figure. What I want to do now, I want to take the sales revenue and convert the sales revenue into cash received from customers. So this is a positive number, cash received from customers. So think about what could explain beside the sales revenue revenue? What could explain sales revenue is account receivable. So I have to look at the change in my account receivable. And for the sake of illustration, let's assume my account receivable went up. My account receivable went up by $15,000 from the prior year. It was zero, the prior year and now it's $15,000. What do I need to do if my account receivable went up? And what does that mean if my account receivable went up? It means I'm selling $15,000 more on credit than I collected the prior year. It means if my receivable went up, it means I'm not collecting the cash. It means in my sales revenue, there is a $15,000 of sales on credit. Well, sales on credit are not cash sales. I'm only interested in cash receipts from customers. Well, the rule is I will start with sales. If my receivable went up, guess what? I will deduct it from sales. So if my sales was $780,000 and my receivable went up by $15,000, therefore my cash receipt from customer is $765,000. The opposite would have been true. If my account receivable went down, went down by $15,000, it means compared to the prior year, I collected more cash. Then I will take $780,000 plus $15,000. Therefore I received from customers $795,000. One more time, I'll start with sales. If receivable went up, I will deduct from my sales. If receivable went down, I add to my sales. Because if receivable went down, I'm receiving more cash. And what I'm concerned about is converting sales, a cruel to cash receipts from customers. Sales is done and this concept would apply to all your revenues. Let's look at the second line on the income statement and usually that's cost of goods sold. Cost of goods sold is basically an expense account. And simply put what you are doing with cash of goods sold is you are spending money, spending money on your, not spending money, basically spending money to your supplier, your writing checks to your suppliers. Cost of goods sold is in a cruel figure. So I need to convert cost of goods sold into cash paid to suppliers. Think of this number as a negative number. So we're starting with cost of goods sold, which is an outflow of cash and we're gonna make certain, we're gonna make certain adjustments. And how do you, how do we convert cost of goods sold into cash paid to suppliers? We're gonna start with cash of goods sold, then analyze two accounts. Inventory, which is a current asset and account spable, which is a current liability. So we'll start with cost of goods sold, which is an outflow of cash. Then we looked at our inventory. If our inventory went up, think about it, inventory went up, it means we bought more inventory. But if inventory went up, it means we have to increase cost of goods sold, increase it in a way negative. So of cost of goods sold for to use numbers, let's assume cost of goods sold was $450,000. And my inventory went up $100,000. Well, then my cash paid to customers and cash paid to suppliers is 550 because my inventory went up, I'm buying more inventory. So if inventory went up, I increase cash paid to suppliers. Then I will analyze my accounts spable. I look at my accounts spable and if my accounts spable went down, what does that mean? It means I am paying down what I owe my suppliers. It means that's gonna increase. Let's assume my accounts spable went down $50,000. Now, I started with, when I started with cost of goods sold, it was $450,000. My inventory went up, that's an additional $100,000 of outflow. Then my payable went down by $50,000, that's an additional $50,000 of outflow as well. Well, what end up happening, cash paid to suppliers is $600,000. Why? $450,000 was my cost of goods sold. I bought more inventory, $100,000 more and my payable went down. Now, the opposite would have been true. If I started with $450,000, my inventory went down. If my inventory went down, let's assume my inventory went down $100,000, it means my outflow was $450,000, then I add $100,000, now it becomes $350,000. Cash paid to suppliers is $350,000 because I'm using inventory that I bought in prior years. I'm not adding to my inventory. And the same thing with payable, if my payable went up, if my payable went up by an additional $50,000, it means I am buying inventory and not even paying for it because my payable went up. So I go from $350,000, then my outflow will be $300,000. Simply put, I'm gonna give you the rule. We start with cost of goods sold. If there's an increase in inventory, we increase that cost of goods sold because we're converting to cash paid to suppliers. If there was a decrease in inventory, that's good news. It means we paid less to suppliers because we bought less from them. Then from an accounts payable perspective, if the payable went up, we reduce cash paid to supplier because we're not paying them. If the payable went down, we'll take that decrease and add it to cost of goods sold to increase cash paid to suppliers. From cost of goods sold, we have other expenses. Let's assume we are looking at depreciation expense. You're looking at the income statement and you said convert depreciation expense. Well, what should be your answer? It's a non-cash expense. So what do I do with depreciation expense? Nada, nothing, I ignore. It's already non-cash because I'm converting everything to cash. You are giving bad debt expense. I don't have to do anything. I'm giving losses. I don't have to do anything. I'm giving gains. I don't have to do anything.  What I'm doing is taking my expenses and converting them into cash, cash basis. Let's take a look at income taxes payable. Let's assume you are giving income tax expense on the income statement for $48,000. Well, what do I have to do? I have to look at my balance sheet to see if I have any income taxes payable and any change in income taxes payable. Well, let's assume, let's assume no change. Well, if my income taxes 48,000 and there was no change, in other words, I look at my income taxes payable from year to year. It's either zero or it was 10,000. It stayed at 10,000. What does that mean? It means I pay to the IRS $48,000. Let's assume I reported $48,000 on the income statement but my income taxes payable went up by 10,000. What does that mean? It means my liabilities, my income taxes liabilities are going up but I'm not paying them. It means although I'm booking $48,000 on the income statement, 10,000 of it was an increase in my liabilities. It means I did not pay 10,000. It means cash paid to the Uncle Sam is only 38,000 because my liability went up, my liability went up. If my liability went down, if my income taxes payable went down by 10,000, now the opposite. Well, I reported $48,000 on the income statement then on the balance sheet my liabilities went down and my income tax liability went down $10,000. Well, guess what? It means I debited expense $48,000, credited cash $48,000, then I debited income taxes payable $10,000 and credited cash $10,000. It means in total I paid $58,000 to Uncle Sam. Why? $48,000 on my income statement and my income tax liability went down. It means I paid an additional 10,000. Therefore it's $58,000. Also, some expenses they have a related liability like income taxes payable, but sometimes they might have a related current asset like a prepaid taxes. Sometimes the company might pay their prepaid taxes. Then I have to analyze their prepaid taxes. If I'm starting with the income statement for $48,000 and I see my prepaid taxes went up by $10,000. So now it's an asset and it went up. What does that mean? It means I paid $48,000 for the income statement then I happen to prepay my taxes by 10,000. Well, if that's the case then I paid $58,000 in my taxes. $48,000 I expense and 10,000 I prepaid. In cash, $58,000 cash paid to Uncle Sam. Same concept will be true if my prepaid went down by 10,000. If I notice my prepaid went down and I'm reporting $48,000 of expenses on the income statement it means of that $48,000, $10,000 was already prepaid from prior year. I just expense that now. It means $48,000 minus 10,000, the decrease in prepaid I only paid $38,000. Simply put, I started with my expense income taxes and I have to look at the related assets and the related liability. If the liability goes up it means I am paying less. If the liability goes down it means in addition to that expense I paid more. Then when I look at my assets I look at the expense and the related asset. If the related asset went up it means I expense $48,000 and I paid more in prepaid. It means my cash outflow is higher than my expense but if I look at my expense and the related account the prepaid went down it means I'm expensing my prepaid. It means I'm not paying them now. I bought them in another period. This period I'm only expensing them, I'm not paying them.  Okay and the tricky thing is when they have a related asset and the related liability. Just look at it separately. Take the expense, analyze the current asset then analyze the current liability and figure it out. It's just they're independent from each other. But remember all expenses are negative and sales revenue is positive. So when you are analyzing your expenses you're starting with a negative number because it's cash paid to suppliers, cash paid to the US government to taxes so on and so forth, okay? So remember the direct method is taking each line and converting into a cash expense. Remember depreciation, amortization, bet that expense, gains and losses. You simply ignore those, you don't convert them. They're non-cash and that's why in the indirect method we adjust them because we're starting with net income. I hope this review although you cannot see the numbers but you could always go to my website or my YouTube and view examples but this is a review for you if you are commuting, busy on the go. If you happen to visit my YouTube or my channel please consider donating to support the channel. Good luck and study hard for your CPA exam.


Item No. SCP-306 Object Class Keter Special Containment Procedures Frozen samples of SCP-306 are stored at Bioresearch Site-101. Research on SCP-306 is to be carried out under Biosafety Level 4 protocols. Subjects infected with SCP-306 are to be immediately placed under quarantine. Many items making physical contact with infected subjects or SCP-306 residue are to be incinerated. Personnel interacting with infected subjects are to remain in full hazmat containment suits. Personnel interacting with infected subjects of SCP-306 residue are to remain under mandatory quarantine and submit to twice daily examination for a period of two weeks after interaction. Infected preaches within controlled environments will result in lockdown of affected area. Personnel within the affected area are to remain in place until cleared for release. Hazmat teams are to remove and examine personnel for signs of infection. Infected personnel are to be quarantined. Affected area is to then be sterilized. A 1km radius around any areas experiencing an outbreak of SCP-306 is to be quarantined. Infected areas are to have all water and sewer systems sealed. Hazmat teams are to be deployed in the area, and all persons in the quarantine zone are to be evacuated and screened for infection. Uneffected persons are to be released, with non-foundation employees administered Class B amnestics.  Following complete evacuation, enclosed areas are to be sterilized with ethylene oxide. In unenclosed areas, controlled burning, followed by a ground sweep, are to be enacted. Wetlands harboring SCP-306 are to be impounded, filled and sealed with concrete. Preventing SCP-306 from infecting any large body of water is an alpha-class priority. Description SCP-306 is a fungus related to the genus Trichophyton. SCP-306 can infect humans through inhalation of spores or by skin-to-skin contact. Initial symptoms of infection include coughing and sneezing, and skin lesions. Lesions caused by SCP-306 display a morphology similar to the benign epithelial tumors caused by HPV infection, and reach full size after approximately two days. Lesions are prone to shredding, after which another lesion forms underneath. Symptoms that fall from the body of infected subjects are light enough to be carried by wind, and capable of spreading SCP-306 for years. If untreated, lesions caused by SCP-306 can cover the body within two weeks. SCP-306 appears to mainly infect humans, however testing is ongoing to determine any additional carriers. SCP-306 has been shown to grow in nearly all biological matter. SCP-306's primary unknowledge property will only manifest when growing on human tissue. When infecting a human, SCP-306 decreed several previously unknown enzymes. These enzymes catalyze an unknown process with drastically altered the structure of cells, resulting in the formation of several extra organelles of an indeterminate function. Approximately two weeks following infection, infected subjects begin to develop major physiological modifications. Over the course of the next three weeks, subjects rapidly lose weight, followed by the development of abnormal pigmentation and increased water permeability of skin. Subjects who are still able to speak describe being in constant excruciating pain. Over the next two to five months symptoms include shrinkage of organ systems, reshaping of the skeletal system, rapid decrease in intellect. This process can last between two and five months, after which subjects are referred to as SCP-306-1. Instances of SCP-306-1 on average weigh 25 to 30 kilograms, measuring 0.5 meters in length. SCP-306-1 have an appearance similar to amphibians, but correspond to known known species. Autopsies of deceased SCP-306-1 specimens have revealed that internal structures remain morphologically similar to human organs following metamorphosis. Instances appear to enjoy human presence and actively attempt to gain contact when in human presence. SCP-306-1 remain extremely infectious, with any direct physical contact resulting in infection by SCP-306. SCP-306-1 are capable of reproduction in a similar manner to Agiliknus caleodrius. SCP-306 was discovered in ██ Louisiana, in a swampy area when locals reported a colony of unknown amphibious creatures coupled with a string of unexplained disappearances. Foundation agents were deployed to the scene to investigate, leading to the object's discovery. Since this event ██, additional SCP-306 outbreaks have been found in the southeastern United States. SCP-306 is resistant to nearly all treatment, with the exception of high heat, C. addenda. Addenda 1. Testing on SCP-306 has shown defunct us to be able to grow nearly all biological matter, including most vertebrates. However, only humans have been shown to develop any deleterious effects from infection. Due to the possibility of a major outbreak, Dr. ████ is requesting increased funding for research in the SCP-306. Addendum 2. Memo from Site ██ Director ██-██-██-1980 Based off Dr. ██'s research in the SCP-306, we now consider extremely likely that large reservoirs of SCP-306 exist in the wild. Because of both the physical danger and danger to secrecy presented, all sites are advised to monitor for wild SCP-306 reservoirs. Any confirmed vectors are to be dealt with by applicable regional forces. Addendum 3. As of ██-██-1980, Site ██ has reported decreased efficacy of antifungal sprays used to combat SCP-306. ██-██-056 has authorized further testing to determine the cause of this change. Addendum 4. Incident I-306-3 On ██-██-1980, all 12 contained instances of SCP-306-1 escaped primary containment during routine feeding. Researcher Thompson was fatally injured by a stray bullet as security subdued the specimens. The following is a transcript of an interview conducted with Researcher Phyllis immediately following the breach. Dude Researcher Phyllis, interviewer Agent Leonard, began log. Thank you for being here on short notice. Sure. Alright, first order of business. Please state what you were doing when the breach occurred. Well, I was conducting feeding for the 306-1 specimens. What's his name? Thompson was getting to feed and I was going to administer it. I did account of the specimens. There were 11, but that was wrong because there should have been 12. So I told Thompson to look at the logs and see if one had been moved to another site. All of a sudden, there is this flash of motion and next thing I know I'm being pinned down by some of the specimens. I don't remember what happened after that. When I woke up, they were gone and security was already there. Thompson was lying on the ground bleeding from his mouth. The guards escorted me out. So you were attacked by the specimens? Basically. I understand that these creatures are normally quite docile. What causes aggressive behavior? Okay. We've been performing some new testing on the specimens. What kind of testing? Intelligence testing. Putting them through mazes, training them, that sort of thing. And what does this have to do with the breach? Everything. These guys were speeding through puzzles, memorizing commands almost instantly. We looked at the data and these guys are as smart as primates, smarter even than that. We tried teaching them how to read, how to write, and they picked it up in the blink of an eye. I have documentation that says those creatures are no more intelligent than a common tree frog. That's what we thought at first, but this testing? It showed that we were dead wrong. They were writing coherent notes to us. They told us what their names were. We gave one of them an IQ test. It scored 127. These things are humans, trapped in the bodies of frogs. So what led to their aggressive behavior then? One of them asked us to bring in some stuff for it to read, though Thompson brought in this kid's book with some fairy tales in it. Seemed like they had enjoyed it, but after that they started getting angry with us. They were depressed. They wrote notes telling us that we had no right to keep them here, that they needed to be out in the world, they needed to be free. What exactly did they expect to be able to accomplish if they were able to escape? I don't know. Okay, I believe we are done here. Wait, before you go, can you tell me what happened to Thompson? KIA, stray bullet in the chest. That's a shame. He was going to bring them another story. End log. Closing statement. Due to the information revealed in the incident, I order all contained instances of SCP-306-1 to be immediately terminated. They are now presenting a major obstacle to successful containment of an already dangerous object, O5-3. Addendum 5, Dr. ██ has found that most samples of SCP-306 display wide-spectrum resistance to antifungals. Upgraded to Keeter Pending. Upgraded to Keeter ██-1990.