OK, thank you very much. As it is a privilege and a pleasure to be here today, I'm going to be giving a largely conceptual paper. So forgive me if I leave you a little bit hungry for more ethnographic and historical detail to substantiate my thesis. But let me introduce you to what I want to talk to you about today. So here we've got the Royal Jew to our national park, the lower portion of the park known as the Terai. There we have the Corsair Elephant Breeding Center. So it's on the edge of the Chitwan National Park, lowland Terai of Nepal. It's situated between very distinct spaces reserved for the activity of humans and wildlife. We're dealing with this idea of lines and demarcation zones of human development, zones of animal biodiversity conservation, this world of fences and lands. Now it's this part of a central node of a network of elephant stables, or Hattisar, that's managed under the authority of the Department of National Parks and Wildlife Conservation, the DNPWC. So Corsair is the elephant breeding center is the place where pregnant female elephants are brought to give birth. It's where they're young, are trained for working life. Because we're dealing here with a country that has virtually exhausted its population of free roaming elephants, big trade in it during the 19th century. It's no longer available to replenish its sources from the wild. So the thing is it needs to use elephants for the management of its protected areas, for army patrolling the border, patrolling for poachers, for facilitating biodiversity conservation with search, and more. So there's no longer the wild population available in sufficient quantity for sustainable capture from the wild. Key point, no longer in sufficient quantity. And furthermore, this enables Nepal to do so without resorting to trade and exchange with foreign countries, which as we heard yesterday is legally problematic. And in this case, it's legally problematic for a country that is a signatory to the convention on the trade and endangered species, Citi, since 1976. So regarding this issue, which cropped up on the first day, I'd like to note that it is a very different story for the private elephants. I'm talking about a government elephant stable. But there's a whole world of private elephant stables servicing the community forests where tourists come for their elephant safaris to see rhino. There it's different. Some hotels, they maintain their own stables of elephants and elephant handlers. Others bring in their elephants by leases. And while I was there during my research, I did hear these stories about bending the rules. As Silberoto Agoche was telling us about in his presentation about Sonapur. So historically, captive elephant management in Nepal was the preserve of the taro. An ethnic group indigenous to the Tarai, operating under royal authority in the inhospitably malarial jungle lowlands, no longer the case since the USA anti-malarial program in the mid 20th century. The taro played a crucial role, capturing, taming, and caring for elephants. So these were the people that were indigenous to this malarial lowland.   They needed Brahmins to perform their funerary rites. But Brahmins would only come down in winter. So if you died in summer, you had to wait to winter before your departed ones' funerary rites could be performed.  So the taro played a crucial role, as I say, capturing, taming, and caring for elephants. And these were used as trading commodities, as objects of tributary fealty, as symbols of political power, as vehicles for royal hunts, which obviously brings us to some of the concepts that Jonathan introduced us to. We are dealing with lively commodities, with encounter value. However, we also have to add in the fact these were lively commodities that were also treated with ritual veneration and respect for their behavioral individuality. So it's this tradition of occupational expertise and its associated ritual practices that continues to inform the culture of the contemporary elephant stable as a kind of adjunct institution of the DNPWC in the modern era of the national park. What was once a hunting reserve is now a national park. Instead of shooting animals, we shoot them no longer with guns, but with cabinets, just as Thomas Tram was talking about. And as I learned during field work at Corsor, it was some of the serving senior handlers themselves who had adapted this very longstanding tradition of capturing adult elephants from the wild. They adapted this for the training of a new regime for juvenile captive-born elephants, typically separated from their mothers at the age of three. And incidentally, I have to mention this. In 2008, an elephant called Davy Carly gave birth to twin male elephants, two boys, Rangaj and Lakshman Carly, Lakshman Raj. And what was interesting about this is they both survived. And I understand it's quite unusual for twin elephants to survive. And upon my return to Corsor in 2011, they were ready for their training. Now, during my field work as a doctoral student, I witnessed and participated in training of two juvenile elephants on two occasions. And at this time, I realized that elephant training had to be understood as more than just a sequence of practical procedures for imparting obedience, for understanding, and interspecies cooperation. Because training was also highly ritualized as an intensely social event, enrolling human and elephant members of the Hatterzal community, both human and elephant. And there's these intense ritual practices, and they caught my attention. And these ritual practices marked phases of separation, and then anality, that's this kind of awkward in between state, and reintegration. So this immediately reminded me as like, this resembles what my anthropological education has taught me or inclined me to recognize as a rite of passage. This was significantly theorized by Ahol van Genep in the early 20th century, later on in the 1960s by Victor Turner, and then in the 1990s by Morris Block. To ensure it typically involves a ritually marked separation from ordinary social life by which subjects sacrifice their autonomy, entering a temporary phase governed by non-ordinary expectations, and undergoing ordeals which serve to dramatize and affect some kind of transformation, usually by reference to transcendental powers, resulting in changes in social status, social responsibilities, and social practices. However, unlike other ethnographically documented cases of ritual initiation, this was not only a transformative process for the acquisition of new skills, capabilities, and to change status under divine sanction, but this was a case that involved both a human and then non-human partner. So I'm claiming then that the concept of rite of passage has applicability for elephants as well as humans. Now, that has radical implications, I think, and I think it forces us to revisit what I call the ontological starting points and the disciplinary subject positions that determine how one frames and studies human-elephant relations. Let me explain. So as a practitioner of a discipline, traditionally focused on one half of the opposition between humans and animals and nature and culture, I was only really trained to investigate the human condition and to do so in analytic isolation from the natural world that we live in populated by myriad life forms. So as a social anthropologist, I expected to study captive elephant management in a way that would make elephants ancillary to humans, that would make them external to human sociality as merely animate objects because I thought I was going to study the expert practice and occupational cultures of Mahoose, which I did, but I thought I was going to do so in a way that would treat the social and ecological agency of elephants as separate and secondary. And I was aware that my disciplinary expertise was limited regarding the science of elephant behavior and ecology. I did start reading some of it, but I realized I could have done with a lot more. So the social world of interspecies relations that I encountered confounded these convenient delimitations of the human from the animal. And these are very important delimitations because they're represented in the kind of disciplinary boundaries that are institutionalized in the structures of modern universities. And it also suggested to me the potential benefits of greater expertise in animal behavior and ecology, even if I have to add in this context, they suffer from their own limits of a rather zoo centric rather than anthropocentric kind. And these limits become significant when one evaluates the strengths and weaknesses of natural scientists and social scientists who are exploring issues of conflict and coexistence often in their own ways as experts on either one species or the other. And it's never quite adequate. We're always a little bit frustrated. And I think these limiting perspectives are also implicated in a kind of reticence of social and natural scientists to engage in collaborative exchange. It does happen, but it's not easy. And people often misunderstand each other. They talk past each other, I find. Indeed, I was in a department of anthropologists and biodiversity conservationists. And I was disappointed that I was not observing any synergistic relations developing. There was two cultures of practice. So I was yet to fully appreciate this during fieldwork, but nonetheless, it proved impossible for me to develop an ethnographic analysis that would restrict elephants to mere moving bodies subject to human purposes. In other words, to disregard them as subjective actors, actors with whom humans develop meaningful, affective, as well as merely instrumental relations. So this is a perspective that requires taking both kinds of sentient entity, seriously, their agency, their behavioral dispositions, their constitutive biographies, and their deep entanglement with human lives and projects made it so much more complex. And it demanded that they be fully incorporated as social actors. Furthermore, it became evident that elephants represented world-making partners. We've heard about them as ecosystem engineers. I think we can add more to that, not just ecosystem engineers, but world makers. And they do so making worlds with us and through us, generating, in my case, the life ways of the Hadesar. And I say so not just of thinking about the Hadesar as a configuration of actions and interactions in socially and materially constructed space, but also, and this is crucial because we know that ecologists have one concept of community, perfectly valid, but when a sociologist talks about community, there's a little bit of a difference. So for me, it wasn't just interactions, it was also about cross-cutting moral responsibilities. And here, then, was what Dominique Lestel has termed a hybrid community, comprising social relations, not just among species, but also between them, and involving social integration and shared obligation. So despite differing bodily qualities, differing sensorial capacities, differing modes of community interaction, humans and elephants live together in ways involving shared meanings and shared effects, even if differently apprehended. And here I should mention that it was this recognition that humans and elephants are mutually implicated in configuring shared lives in shared environments through intersecting social and environmental activity that led me to develop a framework for an integrated approach to the generative relations of impact and encounter between humans and elephants that I have called ethno-elephantology. And I hope that you won't treat it merely as just another neologism. I think there is a legitimate reason for this. Now, I was inspired by the anthropology of culture and historically variable human-primate interactions, which is known as ethno-primatology, and this combines ethnography with primatology. In other words, a social science practice with a natural science practice. And this approach aims for simultaneously social, historical, and ecological forms of analysis focused on the direct and indirect relations between humans, elephants, and environments across space and through time. So this concern with integrating perspectives traditionally associated with discrete disciplines from across the spectrum of the humanities, the social sciences, and the natural sciences motivated a symposium, not unlike this one in fact, that I convened at the University of Canterbury in 2013. And this has led to a book, which I've already been ruthlessly advertising. Forgive me, I'm excited about this. I cannot resist mentioning it. It's called Conflict Negotiation and Coexistence, Rethinking Human-Elephant Relations in South Asia. And it features contributions from anthropologists, biologists, ecologists, geographers, historians, political scientists, and Sanskritists. And as such, it represents, I think, an attempt to establish the interdisciplinary dialogue necessary for developing an integrated approach to human-elephant relations. And I should mention, there are several people in this room who have contributed to this book. And I am very grateful to them. Working with them has been a great pleasure. I hope then that this book will help to inspire more multidisciplinary cooperation. I would really like to see a world where ecologists and biologists and social scientists are working together to deal with the issues of human-elephant relations, with which so many of us are concerned, the problems of captive elephants, the problems of human-elephant conflict, and so on. So then, it's been a bit convoluted, I know. I've reached a point then at which I can connect to the agenda of ethno-elephantology and this idea of the hybrid community, this idea of the hattizar as a place where social life is generated through and between species. I can now connect that to my argument for elephant training as an inter-species right of passage, a right of passage not just for humans, but also for elephants. Now, unfortunately, as I say, the constraints of brevity forced me to give primacy to the argument I wish to make at the expense of detailed discussion of anthropological theories of right of passage. So I don't have time to tell you too much about that. And also, I'm afraid I don't have time to tell you a great deal about the detailed ethnographic description of the phenomena with which I'm concerned. I'll give you a few tidbits. I want to give you a sense of what's involved, but I can't tell you as much as I would like, so forgive me. Let us begin with a quote from an informant that indicates the revolt role of divine sanction in ritually configuring the practice of elephant training. This is Satya Narayan with young Paris gauge named after the then crown prince of Nepal. And Satya Narayan, this is a quote from Satya Narayan. He said, we respect the God, the elephant as a God, like we respect the God Ganesha. So we bow to them as we would the God Ganesha. Only then do we ride them. We think we are riding you as an elephant, but we know you are a God. So we bow to them because we have to respect them as gods. That's why for training, we have to do kamari puja. And that's nothing to do with the kamari of the young virgin girl in Kathmandu. This is the kamari, which is the special post for training the elephant, which must be ritually sanctified. He goes on, so that our elephant can succeed, we must pray to the gods and goddesses that the training goes well. We perform rituals in the hope that the elephant does well, doesn't get hurt and that the elephant learns to walk well. So, three points need to be made here. Firstly, I contend that the ritual dimension of elephant training should not be analyzed apart from the practical procedures. They have to be put together. We can't just treat the ritual as mere cultural ornamentation for an assemblage of instrumentally purposeful practices. Since here we find action, belief and understanding, they're so thoroughly intertwined that to separate meaning from behavior would produce a very disarticulated and partial analysis. So, conceiving of elephants as divine, not just animal beings, has significance, not only for the conduct of the petitioning rituals of appeasement that Satya Narayan alludes to, but also for attitudes of engagement with elephants in all aspects of the training process, which also includes daily driving sessions roped up to training elephants, as well as communal evening sessions of desensitization and familiarization during which Mahoots rub, touch, and sing songs to the elephant, as well as wheels, torches, or fire. And I do have to mention, I was talking to some people yesterday about this. This idea of the elephant as the animal and as a person and as a god, I think it represents a sense by which the Mahoots are trying to navigate the ambivalence of the fact, an animal they respect, but an animal they subjugate, and an animal that they can also treat as a friend and companion. So there's a lot going on, and I think they try and negotiate this through these different modes of relationship, talking about their elephants in different ways and different times, and emphasizing them in different ways. But that's the story of another paper. Second point, though, even though elephants cannot be expected to cognitively participate in the symbolic and semantic communication that's involved in this ritual process of transformation, I don't expect them to know who Bun Davy is the forest goddess to whom we perform our rituals of sacrifice. This does not mean that we should analyze training as if the elephant was exempt from the rite of passage that it represents. And I argue that we treat elephant training as an interspecies rite of passage, not only because it involves the acquisition of new capabilities and a change status for both human and elephant, but also because it is achieved through a process that binds them together as working partners who attune themselves to each other's characteristics. And that is most significant in these daily driving sessions where you can see the elephant roped up to the kunkis, although they don't call them kunkis in Nepal. Both human and elephant are subject to social and spatial separation from their hatties and companions. They have to live apart from their human and elephant others. For finite satchinarine, he says, I have to live in a state of sannyas, temporary asceticism. Both human and elephant are subject to ritual prohibitions. For the human, this means abstinence from meat, from alcohol, from women, from anything impure. And for the elephant, it also means, well, notice, there is no metal here. There's no metal. Most of the elephants, there is metal on the training gear. Now, not everyone performs this, but finite satchinarine was particularly fastidious about this. So there is this idea that there is an impurity to the metal. And you may have noticed in the previous slide how the training roasts themselves are being sanctified in the rituals. So everything is made special. So I have a third point now, dramatic pictures. Thirdly, to assert, I am nearly done, don't worry. To assert that this is an interspecies right of passage that binds human to elephant through a mutually transformative process should not be taken as licensed to disregard the asymmetry of power at play in these rights and procedures. It does involve the principal trainer acquiring practical mastery of the elephant through its submission to his commands. And it is conducted in the context of an institution that appropriates the labor and seeks to secure the obedience of elephants. Handlers perform a type of custodial labor that produces contradictions between veneration and subjugation as well as trusting companionship, as I mentioned, countervailing modes of relation that must be negotiated. In fact, my chapter in our forthcoming book deals with this very topic. In hasty conclusion, then, I contend firstly that an adequate understanding of the Hattisar must recognize the generative role of both humans and elephants as individual actors with particular biographies, particular dispositions and capabilities who shared lives constitute a hybrid or what we might call a more than human moral community. Secondly, I contend that elephant training cannot be adequately treated merely as a practical procedure for fulfilling particular purposes but must also be recognized as a ritual process of separation, liminality and reintegration that results not only in the acquisition of new capabilities and synergistic relations but also in a changed status for both human and elephant. The handler has proven his capability as a trainer. This is significant for his standing among his peers and the elephant has been separated from his mother and tamed to respond to humans prepared for a working life in the national parks of Nepal. Thank you very much.


Well good afternoon and thank you so much for having me here as our announcer said Microsoft is a bit new in the open source world and it's a great pleasure for me to be here at the open source summit representing 15,000 Microsoft employees actually contributing to open source projects in GitHub last year. Just a very quick intro of myself I have just spent I have just crossed my 25 year mark with Microsoft. I started as a developer working on Microsoft Office product and when I think back the kind of transformation that we have gone through just a few years ago as a developer in Microsoft if you want to look at open source code you will actually need to have approval from your VP to do that. That was not very long ago and let me just tell you a story about we open sourced our C sharp compiler in April of 2014 so that's three and a half years ago. As we were getting ready for that particular plan we discovered that we will have to go give the source code right of the C sharp compiler that we built to another legal entity inside Microsoft and I have to tell my compiler developers that they have to sign a contract to become contractors of this other Microsoft legal entity and as you can imagine the my compiler developers were very confused so they came to me they're like what does this mean? Does it impact my benefit? Does it impact my rewards? Why do I have to do this? I'm like don't ask just sign right here that's what we need to get done and that needless to say that we have come a very very long way from those days and age and that was really only three and a half years ago and we have made significant pivot in such a short amount of time and I'm really proud that you know my team my division have led the way for overall for Microsoft embracing open source in a pretty significant way. We have a number of very successful projects including Visual Studio Code including .NET including TypeScript as part of the GitHub community and we have also partnered very closely with many open source communities as well as commercial partners in a broad set of open source project like Node like Kubernetes like Linux etc etc and today I'd like to share some of the lessons that we have learned in this rapid cultural shift and kind of transformation that we have actually been on and what I think about the open source attempts that Microsoft tried to make you know a few years back we were very naive we really thought about open source meant source only we were very focused on hey there's source code for developer to access and use and we took the meaning of open source quite literally and today when we really think about what open source project actually means we're looking at all the different aspects of being open and taking a much more holistic approach about thinking about this and another story from our own journey when we were planning to open source .NET which happened in November of 2014 we when we were looking at what does it take from an engineering perspective to make that happen one of the first deep realization we had is that we have to go make the entire internal engineering system available in the open and this is so that once the source code shows up in GitHub the community can compile the source code and run our tests to validate their changes and make sure that the compatibility is still there you know etc etc so having the engineering system being available is actually prerequisite of having a successful open source project and for us we had a proprietary engineering system that is Windows only we have spent a decade working on it so the effort of taking this engineering system make it available targeting making sure it works on Mac and Linux was the enormous amount of effort what we end up actually doing was that we decided to really sunset a lot of the internal tools that we were using and opt for open source tools by and a large and but there were a number of critical core internal tools that we end up having to open source and make it cross-platform ourselves so the community can actually actively engage in the .NET project when we actually made the open source and the second key decision when we look at the .NET open source effort was in how open we want to be and it sounds a little funny maybe but we actually studied many of the very large and popular open source project to see how the development was actually being done and you will find that some of the very popular open source project the way it was actually done is that the development happened behind closed doors it was happened internally and when we're done with a major release the entire source code kind of get copied out to the you know get her review for the community to see and you know and you're welcome to make bug fixes maybe and then there are some other open source project where the entire team will actually work in the open so when we look at these practices the decision we made is that we not only want to have the entire engineering team doing everything out there in the open but more importantly we really want to embrace the community in helping us in working on our roadmap together we want our roadmap to be designed in the open we want the architectural decisions we make to be discussed in the open we want feature requests and the prioritization and all of these design decisions to be completely discussed in the open so that's a very different approach and mentality approaching open from our early days of just thinking about open source and nearly as to say you know work entirely in the open was a huge cultural change for engineering teams we have a lot of seasoned engineers who have spent many moons you know in microsoft even with the best intentions the team in the beginning really struggled quite a bit with old habits and behaviors you know microsoft for good or bad we're a very email-centric kind of company we love we send a lot of email to each other and we love a lot of face-to-face meetings and for many years our proud decisions were made in conference rooms behind closed doors the architectural decisions were designed and discussed on whiteboards in our buildings so the question now we ask ourselves in this new open and transparent world is that how can we get a community to really understand the context and the rationale for some of these changes we want to make to the core base and really give us very rapid feedback in this whole process and so we took we made a many experiment on being transparent with the community we feed it and one of the one of the best practices if you may that we're starting to kind of you know using more is that we would collect ideas and discussions and topics and issues will actually get community to vote on some of the most popular requests we should put proposal out there and for the community to discuss and as an example the ASP.net team would actually record a weekly stand-up every week to talk about what are top issues that they're facing what is sort of planned for the next stage and they will just put it out on youtube and we get like well over five thousand views every week and then you know comments from the community about what they like what they didn't like questions etc and we have found that to be a very very helpful form for our own internal culture shift from an engineering perspective because for our engineers they are now in a with all of these engagement dialogue with the community they're getting a really deep sense of what are the customer scenarios they're building towards and they understand the impact of the source code change they're about to make and they develop this more emotional connection with actually the users in community at large and the other thing that we really benefited is this rapid and continuous feedback loop that we have even from the initial ideas we get feedback from the community and we you know for many of our product we have you know insider channels or preview channels where the community can get it very early they get to play with our early implementation and give us feedback and then once the product is actually released many of our community members are actually our best product advocates and they help us you know champion our the product so we have you know with this set of changes it really helps us to get the very fast validation of our plans and help us to de-risk the plans we're making and the other element as we realize just like everyone here who are you know in the open source summit we clearly realize that you know a community-centric approach brings a lot of value even then I have to say that we were very surprised by the magnitude of the value we actually received let me tell you another story also has to do with the .NET open source effort when we after you know going through a huge engineering system change and all of that as I mentioned earlier we put the source code out we made big announcement you know in our November event and you know we were top of Hacker News and one of the things we did to put the source code out is that we you know it was our intention to make you know this .NET work on Linux and Mac but our initial source code we released had many many gaps in terms of implementation in terms of APIs to make it fully functional product for Mac and Linux two days two days after we open sourced the product on GitHub we got a massive pull request from someone in the community which had the lion's share of the Mac implementation in his pull request we were astonished because our own team you know they were kind of estimating what take us a couple of months to kind of get to that level of completeness and we were humbled because honestly you know being Microsoft this is three years ago when we put something in GitHub we really didn't know whether community will pay attention they will actually look at our source code we were amazed and humbled by what the community has done and from that moment on it will really help us realize that just develop in the open which means our own engineering team development open is just not enough we really want to become community obsessed and we want to really work on how we can make community an extension of our team and really think about how we can make it super easy for the community to contribute to our repos to raise issues to have a dialogue and so there are many different practices we actually tried to you know a read to kind of achieve to that state one of things as we learned participating other open source project is that when we submit a pull request sometimes it says there for a long time and didn't really get looked at so we kind of instilled a internal SLA to look at like you know if the community making a pull request we want to respond you know in like 24 to 48 hours and not let lead people hanging and that's kind of the courtesy you will extend your own team anyways right and so we're like this is the same thing we will do with our community contribution when the contribution come in sometimes there's a very active dialogue going on the pull request there's lots of back and forth and we really work on give very detailed pull request comments about which part of scene works which part of scene are issues and I think that we have got really awesome feedback from the community that through this dialogue with our engineering teams they got a much better understanding of the core base you know of the of the scenarios etc some of the other things we have tried to do is that we also put a code of conduct out there for our for our for our open source project this is to make sure that we really get the broadest the most inclusive community participation and you know again this is very similar of how we treat our own teams and from a numbers perspective we kind of rethink about what success metric looks like in the past as product engineers we think a lot about how many new features we have released right that's that's what we're really proud of and now with a lot of open source project we also think about how many community contributors are part of our overall process and so for things like visual studio code the team spends up to 40 percent of their time triaging thousands of community feedback and issues every month and and also it's not surprising for visual studio code they're among the top 10 on all of the github projects in terms of total number of contributors to github I mean to visual studio code and for dotnet we're also very blessed that we have you know 60 percent of our pull requests actually come in from non-microsoft employees and the number of the contributors in our top 10 top 20 contributors are external to microsoft and so we really have you know benefited greatly from the community participation and from our engagement with the community lower the barrier to participate and as we transform from a from a company really of kind of shipping box software you know product which is built on proprietary software code that's what we used to do to a company that is much more open that is cloud centric that really embraced community we have learned as i mentioned many practical and cultural lessons initially we also thought that many of the lessons learned were very unique to microsoft we're like we're kind of our own beast and kind of much to our surprise as we're talking to many of the enterprise customers as we discuss their journey to have their own digital transformation with their journey of embracing and use more open source it turned out that maybe we were not as unique as we thought we were many of the lessons we were learned were very well or very applicable in the enterprise in the enterprise settings as well enterprises wants to embrace open source they want to increase the agility of their deliveries and they really found want to focus on you know very differential value to deliver to their own customers so the kind of concerns they have in terms of compliance you know scale security etc are actually quite common and we had dealt with many of these challenges in our own journey so microsoft has become a really trusted advisor to many of our enterprise customers in their own kind of workforce you know transformation and from those dialogues with our enterprise customers we have also learned a lot we learned that while they were very very interested in using a lot of the open source software but in the cloud context they're really not particularly interested or invested to figure out how to take open source and operate in the production and planet scale and you know they're not particularly interested in figuring out how to take open source software make sure it kind of meets all of the compliance and certification and all of these things which are the backbones of being an enterprise and so for us the solution to that particular you know customer pain point that we actually developed a whole set of managed services in Azure in our cloud which is you know developers can use mongo db they can use hadoub they can use spark they can use mycicle etc and by microsoft developing a managed service the enterprise no longer have to worry about doing these kind of end differentiated heavy lifting they can really just focus on delivering value to their customers and another key area for us to focus on being really focused on developers is to say how can we really have super simple and productive experiences for developers to develop their open source and software or based on open source stack and a couple examples some of you you know have been talking quite a bit about visual studio code which is our open source and and a cross platform editor and you know even from the get go we had great node development in visual studio code and one of the other extensions we produced is actually go so we see all of these you know go developers using visual studio code and you know they love the simple productive experiences and another example we have is that you know from a service perspective we recently just g8 the the the Azure app services for Linux so if you actually produce a you know your Linux Python whatever code in a container you can very easily develop and test and deploy that with a managed service like app service and just erase a lot of burden of dealing with SSL dealing with deployment slots and help you make your life easier building on top of open source stack so that's another set of value proposition we think that as Microsoft we can deliver and to really help the overall ecosystem and as I also reflect and think about sort of like the overall role that net had to play in the overall customer adoption of open source I mean it's really not a loss that among all of the popular developer platform done that was the last one to become open source and to become cross platform and now we finally are there we're actually very excited that we have really helped brought the overall open source ecosystem together and it really enabled developers new and oh to download to leverage this technology to be a broad part of solution that's leveraging open source a story I like to share in this case is there's a very popular gaming company the second largest gaming company in China and the name of the company is netties they were actually working on a new mobile gaming title for them and for a lot of mobile developers you were in a particular in the game scenario you know you might know that unity is a very common platform people use and the code to to write for unity is actually C sharp and dot net and so what they have done is that because we have made net open and cross platform they were able to now pick net as the back end implementation for this particular county in the for this particular you know game where historically they have always used you know either java or c++ in this context so when they actually picked c sharp and net they actually got fantastic sharing of code between their front end mobile games and their back end sort of you know back end infrastructure they can reuse the entire linux infrastructure they have previously built on see you know targeting c++ and java in terms of monitoring all of those things and it just runs down that code so in this way when the ecosystem come together our customers wins they really get to pick the best technology that you know that fits their purpose so I just want to say that our we're still on our journey of cultural transformation even though we have made drastic changes in a very short amount of time we're far from complete from our changes and we really appreciate your continued support collaboration and participation and feedback and thank you for giving us feedback and help us being here and in the last couple of years and we really look forward to being an even more active member of the open source community thank you very much


Hello and welcome to the session. This is Professor Farhad. In this session we will look at the present value of a single amount. This topic is covered in an introductory accounting course as well as in advanced accounting courses also covered on the CPA exam, the FAR section. As always I would like to remind you to connect with me on LinkedIn if you haven't done so. YouTube is where you would need to subscribe. I have 1600 plus accounting, auditing, finance, and tax lectures. This is a list of all the courses that I covered, including many CPA questions. If you like my lectures, please like them, share them, put them in playlists, subscribe. If they benefit you, it means they might benefit other people, so share the wealth and connect with me on Instagram. On my website you will find additional resources to supplement your accounting education such as multiple choice truffles and exercises to help you reinforce what you have learned. On a graph the present value would look something like this. We have P today. This is the present value is today and we have F into the future, the future value. What we're looking in this explanation for is this amount today. What do we mean by this? Well today you ask yourself how much money will I need to invest today? How much will I need to put away today to have a certain amount of money in the future? So today I have to invest and in the future I'll have a certain amount of money. Now oftentimes the issue is you know how much money you need in the future. For example, you need to buy a boat, a car, an airplane, a vehicle. You need to invest money for your kids. Whatever that amount is, let's assume I need $10,000 into the future. That's what I need. I know my future amount. How much will I need to invest today? That's what we're looking at today and I'm looking only for one amount. How much will I need to invest today? So I will have the $10,000 into the future. Well that depends on two things. It depends on the time, how long you're going to invest this money for and it depends on the interest rate. Well you're going to invest this money and it's going to grow from now to day into the future. How fast it's going to grow? Well depends on the interest rate. If your interest rate is higher your money will grow at a faster rate and if you started early your money will grow bigger because you started early. So the formula to compute the present value of a single amount is shown below. So to compute the present value of a single amount here's what we do. We're going to take P is the present value. So this is the unknown in this formula. We don't know how much we need to invest today. This is the unknown. We know the future value. This is going to be known. What else do we need to know? We need to know two things. We need to know the interest rate and the interest rate depends on many things, the type of the investment. For example, if you're going to put your money in the bank, well that's not going to be, that's not going to earn you a lot of interest but if you put money in your, in a risky bond that might earn you a higher interest and N is the number of period. Now for our purposes I'm going to simplify and say the number of years but it doesn't have to be years. The number of periods could be semi-annually, it could be monthly, it could be quarterly, but to simplify this we're going to call it number of periods in years for our purposes. But remember N is the number of periods, I is the interest rate. Again, how long you're going to invest this money for depending on your time frame. Are you going to, do you need this money in three years or in five years? If you need the money five years from now you will need to put less money because you will have two extra years of interest accumulated. So let's illustrate this concept. To illustrate the present value concept, assume we need $220, one period from today. So we're going to keep it simple, not simple just the future amount is 200, the period is one period, one period, assume one year, it doesn't have to be a year, we're going to assume it's one year. We want to know how much we need to invest today. So this is the question, we need to know how much we need to invest a day for one period and the interest rate is 10% to get $220. So the problem reads something like this, what amount I need to invest today, it will grow at 10% for one year or one period and will give me $220. Well, if we take the numbers and plug into the formula, so the future amount is 200 and I'm going to explain what the one is coming from, interest rate is 0.1 and the rate and n equal to one. So this is the formula. So conceptually, we must know P must be less than 220. Of course, what we need to invest today must be less than 220 because this to whatever the amount is, whatever we amount to invest today acts, we're going to add to it the interest that's being compounded over time and it's going to give us 220. So this number definitely is less than the future. Of course, you have to know this upfront. So this is clear from the answer. Would we rather have 220 today or 220 at some future date? If we have 220 today, we could invest it today and grow at something larger than 220. So of course, it has to be less than 220 because if we have $220 today, what we do is we'll take this 220 invest and later we'll have more than 220. Therefore, definitely the answer is less than 220. So to compute the answer, we'll take the future value and we'll divide the future value by one plus i raised to the n. n is the number of periods happens to be one. So if we perform this computation, the answer is $200. What does that mean? It means if you take $200 today, multiply this $200,000 by, well, let's first do it in two steps so I can explain where the one is coming from. So if I take $200 today multiplied by .1, which is 10%, it's going to give me $20. If I take my original amount plus $20, it's going to give me $220. So notice I proved to you that if you invest $200 today at 10% for one period, for one period of time, you will get 220. Now, the other way to do this computation is to take 200 times one plus .1, which is a 10%. Now, why do include one? Include the one to say I want the answer to be 200 times one equal to 200. 200 times basically from a mathematical perspective, you're taking 200 times one, which is 200 plus 200 times .1, which is 20 equal to 220. So that's why we add the one, we take a 200 times one plus one plus the interest rate, this way to take the original amount, to take the original amount into account. So that's why we say one plus I, one plus the interest rate. Therefore, the formula is one plus I, one plus I. So notice, indeed, if we invest this money, if we invest $200, we let it sit in the bank at 10% for one period, we will get $220. We interpret this result to say that giving an interest rate of 10%, we are indifferent between a $200 today or 201 period from now. So if somebody asks you, would you prefer to accept $200 today? Or if you wait one year, one period, let's assume the period is one year, one period. And I will give you $220. Well, if you can earn 10% on your money, those both amounts are the same. If you give me $200 today, I would let it grow to $220. And if I wait a year from now, I will get my $220. So the amount technically the same. So the $200 today is the same as the $220 a period from now. So let's use this formula to do more computation and see if we can come up to a general formula or general conclusion. Okay, let's assume we need $242 at two periods from now and we can invest this money at 10%. Simply put, now we are looking at two periods. In two periods, we need $242. This is today. Today is 0.0 or 0. This is one period and this is two period. Now we need this money, two periods from now, $242. We can invest this money at 10%, whatever money we have. How much do we need to invest today? What's the present value today? What's the amount that we need to invest today to get $242? Well, we'll use the formula. We know the future value that we need $242. We can divide $242 by 1 plus the interest rate raised to the second power. Why to the second power? Because we have two periods. Simply put, we need $200. Simply put, let me show you that if we do so, if I take $200 times 1 plus 0.1 raised to the second power, let me show you 200 times 1.1 raised to the second power. Let's do the computation. Let me show you what would happen. 1.1 times 1.1 is 1.21. So 200 times 1.21 equal to times 200 equal to 242. So notice, I just proved to you that indeed if you take $200 invested in two periods for two periods, let it grow, it will grow to $242. Therefore, the answer is $200. So this is just an application of what we just did, what we just did a minute ago. As I mentioned earlier, the number of periods, remember I said this does not have to be expressed in years, although I just said in years, just to give the example simple. Any period of time, such as day, month, or quarter, or a year can be used. Whether period is used, the interest rate must be compounded the same period for the same period. What does that mean? This means if a situation express n in month and i equal to 12%, in other words, if the problem says the n is expressed in month. So the number of periods n in month is, so the number of periods is a monthly basis and they give you an interest rate i equal to 12%. Now, most of the time, not most of the time, the interest rate is quoted annually. Well, if n in month is, how many months do we have in a year? We have 12 months in a year. It means the interest rate 12% will have to be divided by 12. It means the interest rate that we will use is 1%. So if the number of periods is other than a year, then the interest rate will have to be adjusted. If the period is semi-annually, semi-annually is what? It's twice, twice a year. So if they said the period is twice a year and i, the interest rate equal to 12%, then the interest rate really that we're going to have to use i equal to 6%. Why? Because 12% divided by 2 equal to 6%. Let's go a little bit further. If they told you the period is quarterly, how many quarters do we have in a year? Four quarters. It means if they told you it's one year compounded quarterly, it means we have four periods. The same thing. We're going to have to take the interest rate and divide the interest rate by 4. Therefore, the interest rate equal to 3. Therefore, i equal to 3. So it's very important to know this. So in this case, let's just read further. Interest is set to be compounded monthly for the 12% monthly here. For example, the present value of a dollar when n equal to 12 month and i is 12, this is what we'll use. So if you are being told that the period is one month, so you will take the amount, whatever the, this is the future value, whatever the amount is divided by, you don't use 12%. You would use 1%, sorry, 1% and you n equal to 12. This is n, n equal to 12. So if you want to get a dollar, if you want to have a dollar a year from now and the interest rate is 12% compounded monthly, it means you have 12 periods because that's compounded monthly and i equal to 1%. It means you need 88 cent, 88, 88, almost 0.8874 pennies in order to get a dollar a year from now. Okay. Now, knowing all this information, we could use the present value table to compute the present value of a single amount. So rather than doing the computation or I showed you the computation, you could use tables to find the present value of an amount. Okay. A present value table, which we're going to see in a moment, helps us with present value computation. It gives us the present value factor for a variety of both interest rate, i and n, because when to compute the present value, you have to have the interest rate and you have to have the number of period. Each present value and a present value table assume that the future value equal to 1. When the future value is different than 1, we could simply multiply the present value from the table by the future value giving. So the table assumes that your future value is 1, which is 1 dollar, but it doesn't have to be 1. Your future value could be anything, but since we have the factor, we can take that anything multiplied by the factor and get the present value. Now, the best way to show you this is to basically illustrate this concept. To illustrate this concept, let me show you the present value table. This is the present value table. It will be the end of your textbook, depending on which textbook you are using. It happens to be table B1 in my textbook, and this is the formula P equal to 1 dollar divided by 1 plus i raised to the end. Let's go back to the 200 dollar example. I'm sorry, not the 200, the 220. We said, how much money do we need if n equal to 1 and i equal to 10 percent? And remember, we use this formula. Now, rather than using the formula, all what I have to do is I know the number of periods right on the side, 1, 2, 3, 4, 5, 6. So n equal to 1 and i across, the rate is across and 10. So my factor is 0.9091. All what I have to do now, I know the future value is 220. If I multiply 220 by 0.9091, I will get, voila, 200 dollar. Let me show you on the calculator, this way you will see it, that 220 times 0.9091 will give me 200 dollar and 2 pennies that's rounding 200 dollars. Do you guys remember when we looked at the example that said, what if I need 242 dollars two years from now, so n equal to 2, or two periods from now, and i equal to 10 percent? All what I have to do now, is to go to my table, n equal to 2, now it's a new problem, n equal to 2 after two periods, interest rate is 0.0826. All what I have to do is take 242 multiplied by 0.8264. Let's do that and show you, show you the answer, how we come up with the answer, 242 times 0.8264 will give me 199 dollars and 98 cents rounding 200 dollars. So notice, at this point, you can give me any future value, you can give me the number of periods in the interest rate, I can find the present value, I can find the present value. Let's assume I need, just work an example, I need $40,000, n equal to 8 in eight years, I need this money and I can invest this money at 6 percent. So this is the future, this is the future value, this is how much I need and I'm going to n equal in years, I'm going to keep n equal to years, it doesn't have to be, I'm going to tell you it's n equal to years and obviously this is yearly rate. So how much will I need to put today? What's my, what's the amount that I need to invest today? What's my present value? I only need to put this amount only once. Well obviously it has to be less than $40,000, let me show you how I will find this. So the periods, let me erase this, the periods equal to 8, let me just erase this. Okay so for the sake of my illustration, I need this money eight years from now, I can find an investment that's going to give me 6 percent. So the factor is 0.6274, 0.6274, 0.6274 times $40,000 and I need $25,096. 0.6274, 0.6274 and that's going to give me $25,096. Now you know the best way to show you this, to even illustrate this further, I need to show you the actual computation. Let me confirm my number, let me make sure I'm doing this correctly. Will I get 25, if I invest $25,096, will I get $40,000 eight years from now? Let's do a computation of this and show you that it works. So to illustrate this concept, I'm going to show you this in an excel sheet because I need to do this computation. So let me just show you how it works. Okay a year from now, remember I have eight years to come up with $80,000. After year one, after year one, here's what's going to happen. This amount that I have, it's going to grow at 6 percent. So I'm going to take the previous number, multiply it by 1.06. So the, my original amount times 0.6, this amount becomes $26,000. Let me use the commas here. This amount becomes $26,601. Let me show you what's going to happen in year two. In year two, I'm going to keep this money invested and it's going to grow at 1.06. This money is going to grow to, let me just fix my formula, it's going to grow to 28,197. I'm going to keep this money invested and it's going to grow at 1.06 and it's going to grow to 29,000. I'm just going to pull the formula down. It's going to pull down and notice year eight, I'm going to have $39,999 which is approximately grounding 40,000. So notice I just showed you, if I take this amount that I found and I can confirm it to myself, if I keep investing it at 6 percent for eight years and this and it's invested, the investment is compounded. It means I'm not taking out the interest, I'm keeping the interest. So the interest is earning interest therefore I will get 40,000. So simply put, I just showed you that indeed I can find any present value if I'm giving I the interest rate and if I'm giving N the number of periods. If I have those, I can find the answer. Now what about if you want to know how long do you need to invest your money? If you know how much money you have now, the interest rate and future value. So what are we looking at here? We're looking at, remember we have P present value, we have F future value and the P it's going to grow at N and it's going to grow at I. It's going to grow for a period of time using the interest rate. Let's assume we know the future value. We know how much we need. We know how much money we have today. We know the interest rate that we need, that we can invest the money at. The only question that we have is we don't know how long we need to invest this money. Can we find out? Can we solve for N? And the answer is yes we can. Let me show you. Let's assume a $100,000 future value. Simply put, we know we need to have 100,000. That's worth $13,000 today. Today we have $13,000. We have $13,000 in the future. We want to have 100,000. We know we can invest this money at 12%. So notice we have the future value. We have the present value. We have the interest rate, 12%. But what's unknown is N. How long do we have to invest this money in order to get in order to get 100,000? How do we find the answer for such a question? Here's what we do. We can use the present value table, which is table B1 that I was just working with. I'm going to go back and look at it. And what we'll do, we'll take the $13,000, the present value, put it in the numerator and divide $13,000 by $100,000. So take the present value divided by the future value. Okay, let's do that. So if I take $13,000, $13,000 divided by $100,000, I'm going to get 0.13. The answer is 0.13. What is 0.13? 0.13 is the factor. Now, how do I find the answer? 0.13 is 0.13 of what? 0.13 is the factor. Now, what do I need to do? I know the interest rate that I can earn is 12%. So I'm going to go to my table and I know the 12%. I know my I, 12%, right here. I is 12%. I know my I, let me highlight, if I can highlight my I, I know my I is 12%. So what I would need to do now, I need to go down across 12% until I get to 0.13. And if I keep on going down across, I see 0.13 right here. Now, I look on the other side, I go across and it seems, let me highlight the 0.13 as well. I highlighted the 0.13, I move across and it seems I need 18 periods. So it's going to take me, for the $13,000, it's going to take me 18 periods, assuming in years, it's going to take me 18 years. So simply put, so simply put, simply put, it's going to take me 18 years to get the money that I will need, I will need to get. So the $13,000 that I have today, that's going to grow to $100,000, give an interest rate of 12%, it's going to take me, we found the answer, it's going to take me 18 years. Now, obviously, you can prove this to yourself, you can take this $13,000 multiplied by 1.18. It's going to be your year one balance, take your year one balance multiplied by 1.18, so on and so forth. And you will find out after 18 years, it's going to give me 100,000. So what I did is I find the I, I found the, I'm sorry, I found the N giving the I, giving the P and giving the F. Let's look at another scenario, Sol for I. Let's assume we know the future value that we need is 120,000. So we know the future value is 120,000. We know we have $60,000 today, $60,000 present value. And we know we have nine years, we have, we have nine years for this money to double and equal to nine, because we have $60,000 today, we need 120, nine years from now. The question becomes, what interest rate, what investment do we need an order, what interest rate at what rate do we need to, to, to invest this money, the $60,000, so we will get, so this money will double. Well, we use the same concept, we'll take the present value divided by the future value and that's easy, that's going to give us 0.5. 0.5 is the factor. Now we have the factor, 0.5, we know N equal to nine, we're going to do the same thing, we're going to go to the present value table, N equal to nine, and we're going to go across to find which one is the closest to 0.5, so we're back at the tables, now we know, now we know N equal to nine, so we know N equal to nine, so we know this number equal to nine, let me highlight this number, we know this number equal to nine, now we need to go across and find the closest thing to 0.5, the closest thing to 0.5, the closest thing to 0.5 is 0.5002, that's the closest thing, so approximately we need, let me highlight this number, we need to earn 8% on our investment, we need to earn 8% on our investment, the earning is 8%, so what we did is we found the interest rate, we found the interest rate, now the best way to illustrate all these concepts is to actually work a few examples to show you how the present value work, my company expect to earn 10% per year, so this is I equal to 10%, on an investment that will pay 606,773, which is the future value, F, six years from now N equal to six, can you find the present value of this investment? Simply put, if you need to have 606,773 dollars, six years from now, how much money you will need to invest today, so what's the present value today? Okay, what's the present value today? Well, all what I have to do is I have to go to my tables, I equal to 10 and equal to six and they meet at the factor 0.5645, 0.5645, so I'll take 606, 773, 773 multiplied by this factor, so 606, 773 multiplied by 0.5645 and I need obviously less than this amount, 342, 523, 342, 523, so this is the answer, this is the present value, simply put, if I, what I'm saying is this, if I invest this money today and let it sit for six years earning 10%, I will have 606,773, so I found the present value. Let's take a look at another example, a company agrees to pay 20,000 in three years, okay, so they pay, so the future value equal to 20,000, that's what they need to pay and they need to pay in three years. If the annual interest rate is 10%, how much cash will the company can borrow with this agreement, so how much cash will they need today? How much cash they will need today, so what's the present value? Well, obviously it has to be less than 20,000 and equal to three, they need this money three years from now and 10% is right here, so the factor I'm going to be using is 0.7513, so if I take 20,000 multiplied by 0.7513, let's do this, if I take 20,000 multiplied by 0.7513, I will need 15,026 dollars. Again, you can prove it to yourself, since this is only three periods, I'm going to go ahead and show you that it will be 20,000 if you invested it at 10% for three years, so it's today we need to come up with 15,000 and 26 dollars, 15,000 and 26 dollars, we have year one, year two and year three and it's going to grow at 10%, so I'm going to take the previous amount multiplied by one plus 0.01, the original amount and add to 0.1, add to a 10%, a year from now it will be 16,528, if I grab the formula in three years I will have 19,999 dollars and 61 cent, if I round it will give me 20,000, hopefully I just showed you that if I proved it to you, I showed it to you. Now, Thompson expect to invest 10,000 at 12%, so at the end of a certain period, at the end of a certain period received 96,463, how many years will it be before Thompson received the payment, so simply put Thompson today he got 10,000 dollars, he knows the present value, he knows the future value, 46,463, the future value, he knows he can invest this money at 12%, the only question he does not know, how long it's going to take him, how long it's going to take him to have this money, how long, well, again I'm going to be using the tables in order to compute this, how do I compute this, first I will need to take my 10,000, my present value divided by the future value, let's do that, if I take 10,000 divided by 96,463, that's going to give me 0.1036, 0.1036, this is the present value factor, this is called the factor, the PV factor, now I know I equal to 12, so I know I'm going to be looking into this equal to 12, so I'm going to go down until I get the closest to 0.1036, I'm going to keep going down below 0.10, I have here 0.1037, that's the closest, if I look across it's going to take Tom n equal to 20 years, n equal to 20 years, well, you know what, let me just also confirm this, I just want to show you that it works, I just want to show you one more time, so we have 10,000 and I want to make it 96,463, I equal to 12%, okay, so if I go to my excel sheet, I have $10,000 and it's going to be 20 years, year one, year two, let me grab it all the way to year 20, year 20 and this money is going to grow at 12%, so I'm going to take the previous amount, multiply it by 1 plus 0.12 and if I take this formula and I grab it and in 20 years notice I will have 96,000, let me round it, 963 and this is the answer, it will take me 20 years if I let this money grow at that amount, so notice we prove the computation, just to kind of show you that it works, just so you have more confidence. Bill, expect to invest 10,000 for 25 years, so we know we have 10,000, this is the present value, we know n equal to 25, after which he wants to receive 108, I don't know what he needs this money for, but he needs 108,347, the question here is what interest rate, what is the i, what is the interest rate that we will need to invest this money at, so we know PV, we know the present value, we know the future value, we'll do the same thing, we'll take the 10,000 divided by 108,347, so 10,000 divided by 108,347 and that's going to be 0.0922, 0.0922, so this is the factor, I know n equal to 25, do I have 25, I do have 25, so n equal to 25 and I'm going to go across until I find the closest thing to 0.0922, well I have it right here, 0.0923, it looks I need to earn i equal to 10%, simply put, if you take this 10,000 invested at 10% for 25 years, you will have 108,347, 108,347, so hopefully after you look at these exercises, it's starting to make more sense, we're looking to find out how much we need to invest today, so simply put, how do we use this in the real world, well how much do I need to lend you money today if I want to earn a certain amount of money, okay, so that's how it works, like how much will I need to give out today in order to get a certain amount of money in the future, so that's the importance of present value computation is a very important concept in accounting and you will see why, now we did the present value, we're going to also look on how to compute the future value, we're going to learn how to compute the present value of an annuity and the future value of an annuity, so we're going to have to compute few things, if you have any questions, any comments about this recording, please let me know, as always I would like to remind you to visit my website for additional resources, like my recording, share them, put them in playlists, in the next session we'll look at the future value of a single amount, stay safe during those coronavirus days, good luck.