“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”Contents            Titles     ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”            Chapter 9          ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”                               ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL              STATEMENTS OF K.H.D.C.L.td.”                              ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL              STATEMENTS OF K.H.D.C.L.td.”3) To know the proportion of v...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL              STATEMENTS OF K.H.D.C.L.td.”                   Karnataka H...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL              STATEMENTS OF K.H.D.C.L.td.”      The main objectives of t...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL              STATEMENTS OF K.H.D.C.L.td.”Many steps has been taken by K...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”              There are ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”                           ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”                People pref...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”20% of the goods produced e...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”         III) A complete suppor...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”          IV) The employees are...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL               STATEMENTS OF K.H.D.C.L.td.”                             ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                STATEMENTS OF K.H.D.C.L.td.”                            ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL               STATEMENTS OF K.H.D.C.L.td.”                            S...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL               STATEMENTS OF K.H.D.C.L.td.”REGISTERED OFFICE        : N0...
“ANALYSIS AND INTERPRETATION OF 10 YEARS                    FINANCIAL STATEMENTS OF K.H.D.C.L.td.”                        ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”DESIGN OF THE STUDY 3.1 Sta...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.” 3.3 Scope of the study    ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”     Plan of analysis      ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”                        ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL              STATEMENTS OF K.H.D.C.L.td.”7) Lungees.8) Polyester sari.9...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                STATEMENTS OF K.H.D.C.L.td.”OBJECTIVES OF PRODUCTION DEP...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”                      FLOW CHAR...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”        production units. and a...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”                     (The dyed ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”            (The yarn which...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”Grey warehouse means raw-ma...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                   STATEMENTS OF K.H.D.C.L.td.”Finance is an important f...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.” Wise head office collects fina...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                STATEMENTS OF K.H.D.C.L.td.”          FINANCIAL RESULTS ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”   l)   Providing all th...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”                  The K.H.D.C.L...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”     2) Life insurance scheme: ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.”          From 1999-2000 to 200...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                   STATEMENTS OF K.H.D.C.L.td.”           Depending upon...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”                   Each sho...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”new varieties like Silk emb...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL              STATEMENTS OF K.H.D.C.L.td.”                  ASSISTANT TE...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                   STATEMENTS OF K.H.D.C.L.td.”                         ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”               The K.H.D.C....
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”Meaning of financial statem...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL             STATEMENTS OF K.H.D.C.L.td.” 2) Income statement(Profit and...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL              STATEMENTS OF K.H.D.C.L.td.”       1. Study and understand...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL               STATEMENTS OF K.H.D.C.L.td.”              2) Study of tre...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”              Comparativ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”      1) Comparative balanc...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”                 The financ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                 STATEMENTS OF K.H.D.C.L.td.”as 100 and all other items ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                  STATEMENTS OF K.H.D.C.L.td.”Particulars               ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”COMPARATIVE INCOME STATE...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                     STATEMENTS OF K.H.D.C.L.td.”(o.s+purchase-c.s)     ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”                        ...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                     STATEMENTS OF K.H.D.C.L.td.”        COMPARATIVE INC...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”        COMPARATIVE INCO...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”        COMPARATIVE INCO...
“ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL                    STATEMENTS OF K.H.D.C.L.td.”       COMPARATIVE INCOM...
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
A project report on analysis and interpretation of 10 years financial statements
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A project report on analysis and interpretation of 10 years financial statements

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A project report on analysis and interpretation of 10 years financial statements

  1. 1. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”Contents Titles Chapter 1 Executive summary Chapter 2 Industrial profile Company profile Organization structure Chapter 3 Design of the study • Statement of problem • Objectives of the study • Scope of the study • Methodology of data collection • Sources of data collection • Limitations • Organization study Chapter 4 Financial analysis • Introduction to study • Comparative statements • Common size statements Chapter 5 Data analysis And interpretation • Comparative income statement • Comparative balance sheet • Common size balance sheet • Common size income statement Chapter 6 FINDING SUGGESTIONS Chapter 7 CONCLUSIONS Chapter 8 BibilographyBabasabpatilfreepptmba.com Page 1
  2. 2. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Chapter 9 Annexure Sl.No Name of the Statement 1 Comparative income statement 98-99, 99-00 2 Comparative income statement 99-00, 00-01 3 Comparative income statement 00-01, 01-02 4 Comparative income statement 01-02, 02-03 5 Comparative income statement 02-03, 03-04 6 Comparative income statement 03-04, 04-05 7 Comparative income statement 04-05, 05-06 8 Comparative income statement 05-06, 06-07 9 Comparative income statement 06-07, 07-08 10 Comparative balance sheet 98-99, 99-00 11 Comparative balance sheet 99-00, 00-01 12 Comparative balance sheet 00-01, 01-02 13 Comparative balance sheet 01-02, 02-03 14 Comparative balance sheet 02-03, 03-04 15 Comparative balance sheet 03-04, 04-05 16 Comparative balance sheet 04-05, 05-06 17 Comparative balance sheet 05-06, 06-07 18 Comparative balance sheet 06-07, 07-08 19 Common size balance sheet 98-99, 99-00 20 Common size balance sheet 99-00, 00-01 21 Common size balance sheet 00-01, 01-02 22 Common size balance sheet 01-02, 02-03 23 Common size balance sheet 02-03, 03-04 24 Common size balance sheet 03-04, 04-05 25 Common size balance sheet 04-05, 05-06 26 Common size balance sheet 05-06, 06-07 27 Common size balance sheet 06-07, 07-08 28 Common size balance sheet 06-07, 07-08(horizontal) 29 Common size income statement 98-99, 99-00 30 Common size income statement 99-00, 00-01 31 Common size income statement 00-01, 01-02 32 Common size income statement 01-02, 02-03 33 Common size income statement 02-03, 03-04 34 Common size income statement 03-04, 04-05 35 Common size income statement 04-05, 05-06 36 Common size income statement 05-06,06-07 37 Common size income statement 06-07, 07-08Babasabpatilfreepptmba.com Page 2
  3. 3. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” List of charts Chart no Name of charts 1 Chart on capital employed 2 Chart on accumulated loss 3 Chart on net profit or loss 4 Chart on sales 5 Chart on administration expenses 6 Chart on fixed assets 7 Chart on net current assets 8 Chart on revenue from other sources 9 Chart on cost of productionBabasabpatilfreepptmba.com Page 3
  4. 4. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” EXECUTIVE SUMMARY The K.H.D.C.L.td is the manufacturing unit, engaged in procurement of the cotton clothes and manufacturing of variety of cotton cloth products such as Napkin, Plain towel, Bed sheets, Saris, Lunges, etc. It is undertaking lot of activities to support the Weavers who are the main producers of clothes. The manufacturing oriented undertakings require large amount of investment in fixed assets and current assets namely, inventories, receivables and cash. There is need to analyze the financial performance of the organization. The organization has a large amount of accumulated loss from last many years. So I took the topic of my project is “factors affecting to the development of K.H.D.C.L.td.” in KARNATAKA HANDLOOM DEVELOPMENT CORPORATION, GADAG. This project deals with the study about “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” At KARNATAKA HANDLOOM DEVELOPMENT CORPORATION, GADAG.OBJECTIVES OF THE STUDY1) To know the financial status, long term financial position of K.H.D.C.L.td throughcomparative balance sheet.2) To know the growth rate in profit, expenses, cost of goods sold through comparativeincome statement.Babasabpatilfreepptmba.com Page 4
  5. 5. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”3) To know the proportion of various elements of income statement items to the totalsales revenue of K.H.D.C.L.td through common size income statement.4) To know the proportion of various elements of balance sheet items to the total capitalemployed of K.H.D.C.L.td through common size balance sheet. SUGGESTIONS 1 .The firm should minimize its administrative expenses to increase profit. 2. The firm should control the operating and manufacturing expenses. CONCLUSION By analysis and interpretation of financial statements ofK.H.D.C.Ltd. I conclude that K.H.D.C.Ltd manufacturing expenses arerising from year to year, and also companies various departmentsestablished in different places which raises the administration expensesdue to these reasons company was in loss from several years, but fromlast two years K.H.D.C.Ltd was in profit because K.H.D.C.Ltd controllingthese expenses.Babasabpatilfreepptmba.com Page 5
  6. 6. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Karnataka Handloom Development Corporation(KHDC) sells its products by the name of Priyadarshini handlooms. They are famous fordesigns and quality. Priyadarshini handlooms like saris, bed sheets, shirts and towel,napkin are used by the people of inside and outside of India. As the name suggests it iscorporation for development of weavers. In Karnataka more than 13 places K.H.D.Ccenters are working. The yarn is collected from mills. It is processed and sold in themarket by the brand of Priyadarshini handlooms. K.H.D.C. Ltd. Karnataka Handloom Development Corporation Ltd. Was established on Dec 12, 1975. At that time Indira Gandhi was prime Minster & first at banahatti then other places. The main role of K.H.D.C.L.td is to provide continuous employment opportunity to handloom weavers. It is an Employment oriented corporation and not sales oriented.OBJECTIVES OF K.H.D.C.L.td.Babasabpatilfreepptmba.com Page 6
  7. 7. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” The main objectives of the corporation are the intensive handloom development project should in a position to undertake, the following services for the weavers under the unit. 1) To provide continuous employment at weavers for their steady lively hood. 2) Arrangements for the modernization of the handlooms wherever necessary make the products more attractive... 3) To release the weavers from the clutches of master weavers. 4) Organizing 100% marketing facility for the handloom products. 5) Maintain raw-material bank with adequate stock of yarn, dyes & chemicals and spare parts for the hand looms so that continuous Supply of these inputs to the weavers in the unit could be maintained If necessary organized a suitable dyeing unit to support the production Program of the units. Karnataka Handloom Development Corporation having 150 units, 40 showrooms in & out side of the state. The other states like Mumbai, Calcutta, and Delhi etc. itcovers from taluka level to metropolitan city. On the basis of income it covers high &medium class people. For example: middle class people purchase the 60/90 size bed sheets. & high classpeople purchase 90/108 size bed sheet. The Head office of K.H.D.C.L.td. at Hubli & Bangalore. The Gadag-Betageribranch is directed by Hubli branch. Before the Bangalore is only the Head Office, it isnot so effective due to this to concentrate on the development of North Karnatakaweavers the head office is also started in Hubli. The K.H.D.C.L.td is first & famous forthe direct issue of Raw material, & Direct pre-requiring the finished goods by payingconversion charges.Babasabpatilfreepptmba.com Page 7
  8. 8. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”Many steps has been taken by K.H.D.C.L.td towards the coverage of more numberof handlooms , weavers & stating of more intensive handloom development projects.It has started raw-material cum procurement depots & enterprises within and out side thestate also. There are 2 export oriented projects with an assistant of state and centralgovernment, functioning in the state. It is providing the continuous employmentopportunity to the 15000 weaver’s families.On 1977 the K.H.D.C.L.td has started in Gadag district. Under this 18 sub-centers areworking 1) Betageri 2) Narasapur 3) Shigli 4) Laxmeshwar 5) Khanapur 6) Gajendragad 7) Mushigeri 8) Allavandi 9) Mundargi 10) Hombal 11) Hebbal 12) Kumta etc. Under this centers varieties of products are produced like multithread design &plain bed sheet, Tarkee towel, carpet, drill, cerement, lunge etc. these products are wellin demandBabasabpatilfreepptmba.com Page 8
  9. 9. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” There are totally 150 production units, 40 show rooms of K.H.D.C.L.td withinand out side Karnataka. The products of K.H.D.C.L.td. consumed by taluka level tometropolitans city people. Like Mumbai, Calcutta, Delhi, etc. Based on the income of the people goods are consumed. Like middle income peoplepurchase 60/90, bed sheets. And high income people purchase 90/108, bed sheets. One of tuff competitor for hand loom industry is power looms. For weaving 1 metercloth the handloom industry takes Rs 10. In other hand power loom takes only Rs 2. The state government gives 20% and central government gives 10% rebate/discounton K.H.D.C.L.td products. BRANCHES OF PRODUCING POPULAR COTTON PRODUCTS. 1) Polyester production centre (Betageri). – 60/90 inch Rib bed sheet. 2) Common weaving centers (Betageri). - 90/108 inch Bed sheet. 3) Common weaving training centre. – Zakard bed sheet (Narasapur) 4) Sub centre Narasapur - V.V.Shirtings. . 5) Sub-centre Shigli - Button bed sheet. 6) Sub-centre Laxmeshwar - Meera bed sheet (Govt. hospitals) 7) Sub-centre Gajendragada - 2/80 cotton lunge 8) Sub-centre Hunsigeri - Casement 9) Hubli - V.V.Shirtings Babasabpatilfreepptmba.com Page 9
  10. 10. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” INTRODUCTION TO INDUSTRYHANDLOOM :Handloom industry form a part of India’s heritage and exemplify therichness and artistry of the weavers the 1997-98 annual report of the ministry of textilestates that the handloom industry is the largest direct and indirect employee (more than3million weavers & 12.4 million other persons)among the traditional industries. The production of handloom fabrics was 7.862 million square in 1997-98 & contributed to nearly 23% total cloth produced in the country. The hand weaving ofcloth from yarn (i.e. produced from mills) forms an important segment of rural Industry.With respect to spread over geographical area, employment opportunity, export. The art of weaving handloom fabrics in India an ancient traditionaltechnique. The Indian craftsmen have excelled in their creative craftsmanship decorationand ornamentation. The economy of a country depends on its industrial development inaddition to agriculture. Handloom industry is considered as one of the largest cottageindustry. Cottage industry provides large number of employment opportunities to India, inwhere population is increasing in a rapidly. Centuries ago our ancestors were using the leaves of trees leather ofanimals for cover &safe their body from rain, winter etc. slowly they found that 2 series ofthreads can be interlaced, which is more comfortable than leaves & leather. Gradually theyfound equipments made of wood for interlacing two set of threads of which result wasfabric & process is called weaving. Babasabpatilfreepptmba.com Page 10
  11. 11. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” People prefer firstly for self consumption, and then they also startproducing to others similarly Indian handloom industries also producing for exportpurpose. The art of weaving is improved generation to generation with improvedtechniques. Innovative techniques are using to produce the fabrics with modernizinglooms. Latest looms are shuttle looms such an Rapier, Sulzer, Air jet, water jet &multiphase loom more production can be made with this looms means 300-500picks/minute. It produces variety of cotton cloths .Indians are more likely to wore different typeof clothes. For a women no. of costumes are produced by a handloom industry. In thatsaris are assumed a special importance which can be wore in different traditional styles.Saris are fashioner for a woman personality. In a social life it plays a significant role. Sarisare symbol of our national code dress for women. The demand is their for Indian saris notonly in India but also in foreign countries. Handloom industry one of the important segment of the cottage industry amongthe rural folk next only to agriculture. Cottage industry helps to equal distribution ofincome and wealth of the country. Many farmers are not having the work for 12 months ina year. Work only when there is a monsoon. After that they are unemployed. Handloomindustry provides full time employment to the farmers. After the agriculture, cottage industry provides many employment opportunitiesto the rural people. Because large number of rural people are illiterate. This can be justifiedby the fact that 96 lakhs handloom weavers are spread throughout, the length & breath ofIndia out of the total contribution of textile industry handloom sector constitutes about Babasabpatilfreepptmba.com Page 11
  12. 12. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”20% of the goods produced every year. It also helps to get more foreign exchange to oureconomy. The handlooms (Reservation of articles for production) act 1985 aims atprotecting the interest of weavers. Under this act, textile articles are presently reserved forexclusive production by handloom units (as per the government notification dated July 26,1996) Indian women’s are more attracted to different variety of saris, with low costand high quality of saris. This can be made by power looms. Because it uses machineswhich are run by power, skilled labors, here cost is reduced also produce more productswith a short time & good quality .generally it is not possible for hand loom industry.Because it is run by workers they take more time for producing and cost is more. Raw material used saris are silk cotton, Reshmi zara, thread silk, yarn,cotton and different type of designs. Generally the size of saris is 46 and the size ofweaving machine is 50. The wage is depending on design working of saris like chikkiparas, thoda paras. This can weave by one person or more, for more than 2 days, planesaris take only 1 day depending on time factor. There is a direct selling of products .herecustomers come to home and buy the goods. The selling price depending on market rate &expenses made for that product.SWOT ANALYSIS OF HAND LOOM INDUSTRY.  STRENGTHS I) The demand is there for traditional hand weaved clothes. II) The large market is there in the out side state also for cotton clothes especially saris, like Maharashtra. Babasabpatilfreepptmba.com Page 12
  13. 13. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” III) A complete support from the government. IV) It helps the weavers from reliving from the clusters. V) The K.H.D.C. Ltd products sold by the brand name of “PRIYADARSHINI HAND LOOMS” – THE HOME OF ORIGINAL HAND LOOMS. This is having one of the best good will in the Indian market. VI) K.H.D.C.L.td is gets every year government orders For the EDUCATION Department, SOCIAL WELL , Department Zilla panchayat department, KSRTC Department, HEALTH Department. VII) K.H.D.C.L.td is having export cell under the brand name “PRIYADARSHINI INTERNATIONAL HAND LOOMS –THE HOME OF ORIGINAL HAND. LOOMS At Bangalore which is concentrated on Export market. VII) Betageri branch only produce the Cotton Rib bed sheets. VIII) The durability of hand loom products is minimum 6 years but power looms not more than 3 years. IX) The hand loom products are value addition with durability and hand work are available. WEAKNESS I) Dependence on few products. II) Not possible to maintain the punctual time compare to Power looms. III) Production cost is more comparing to power looms.Babasabpatilfreepptmba.com Page 13
  14. 14. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” IV) The employees are migrating from hand loom to power loom. V) To retain the employees pay more which increase cost of production.  OPPORTUNITIES I) More demand for hand loom products. II) Multi thread design get only hand loom industry. III) Value addition can be made by hand work, it increase the value also the price.  THREATS I) Number of skilled weavers is decreasing day by day there May be weavers are not available in future. II) If there is no government assistant then it is not possible to to hand loom industry to stand in the competitive world. 9 PROJECT OFFICES OF K.H.D.C.L.td 1) GADAG-BETAGERI 2) BHAGYA NAGAR (KOPPAL) 3) RABAKAVI 4) BANAHATTI 5) RANEBENNUR 6) ILKAL 7) BASAVKALAYAN 8) GULBARGA 9) RAMDURGA.Babasabpatilfreepptmba.com Page 14
  15. 15. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Company ProfileNAME OF THE ORGANISATION: KARNATAK HANDLOOM DEVLOPEMENTCORPORATION.YEAR OF ESTABLISHMENT : 1975TOTAL SHOW ROOMS : 60PLACES OF SHOW ROOM : DEHLI, KOLKATTA, BANGALORE, HUBLI, GADAG-BETAGERI, CHENNAI etc.MANAGING DIRECTOR : Dr H. BHASKAR, IAS (FOR WHOLE STATE)BUILDING : RENTED, 60000 P.a.BANKERS : STATE BANK OF INDIA. STATE BANK OF HYDERBAD. CANARA BANK. Babasabpatilfreepptmba.com Page 15
  16. 16. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” SYNDICATE BANK. FEDERAL BANK LIMITED. PUNJAB NATIONAL BANK. CORPORATION BANK. VIJAYA BANK. STATE BANK OF PATIALA.REGISTERED OFFICE : NO 3, 2nd Floor ENKAY COMPLEX, KESHAVPUR, HUBLI, KARNATAKACHAIRMAN : Sri M.D. LAXMINARAYANA Sri GOOLIHATTI D. SHEKAR Sri ARAVIND G. RISHBUD.MANAGING DIRECTORS : Sri S.N.JAYARAM, IAS., Sri I.R.PERUMAL,IAS.,DIRECTORS : Sri INDER DHAMIJA, IAS., Sri MAHENDRA JAIN, IAS., Sri ASHOK KUMAR C. MANOLI, IAS., Sri MOHAMED SANAULLA,IAS., Sri YOGENDRA TRIPATHI,IAS., Sri G.KUMAR NAIK,IAS., Sri H.BASKAR, IAS., Sri B.S. RAMPRASAD,IAS., Sri P.B. RAMMURTHY, IAS., Babasabpatilfreepptmba.com Page 16
  17. 17. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Sri AJAY SETH, IAS.,FUTURE PLAN : TO COVER ALL WEAVERS.TURN OVER : 90 CRORES (K.H.D.C.) 2 CRORES GADAG BRANCH.WORKERS : 25 WEAVERS, 5 VENDORS.BASIS OF SALARY : PEACE RATE SYSTEM.MACHINES : NO.WORKING DAYS : 365 DAYS.PER DAY PRODUCTION : 120-140.BRAND NAME : “PRIYADARSHINI HANDLOOMS.” - THE ORIGINAL HOME OF HANDLOOMSSALES : 60-70 CRORE P.a.DURABILITY OF K.H.D.C. MINIMUM 6 YEARS.PRODUCTS :CUSTOMERS : MEDIUM AND HIGH INCOME PEOPLE.COMPETETORS : POWER LOOMSAUDITORS : BASAVARAJA & DILEEP CHARTED ACCOUNTANTS, # 14, 2nd FLOOR, MADHU COMPLEX BURGALMATT NORTH CROSS ROAD, V.V. PURAM, BANGALORE-560004. Babasabpatilfreepptmba.com Page 17
  18. 18. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”REGISTERED OFFICE : N0.2, IInd FLOOR, ENKAY COMPLEX, KESHAWAPUR, HUBLI-580023 KARNATAKA. PHONE: 0836 – 2268762. BANGALORE OFFICE NO.1, TANK ROAD, PRIYADARSHINICOMMERCIAL COMPLEX HALASURU, BANGALORE-560042 PHONE – 080-25575421-425 FAX – 080-25575426 E-mail :khdc@vsnl.netPRODUCTS: COTTON MULTI THREAD BED SHEETS PLAIN TOWELS, NAPKINS PLAIN BED SHEETS, CARPET TARKISH TOWELS, DHOTIS POLYSTER SARI, DRILL CLOTH, COTTON SARI Babasabpatilfreepptmba.com Page 18
  19. 19. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” ORGANIGATION CHART OF K.H.D.C.L.td. CHAIRMAN/BOARD MANAGING DIRECTOR PRODUCTION QUALITY MARKETING FINANCE HUMAN DEPARTEMENT CONTROL DEPARTEMENT DEPARTEMENT RESOURCE DEPARTEMENT DEPARTEMENT SALES MANAGER TECHNICAL OFFICER FINANCE JOINT CONTROLLER DIRECTIOR ASSISTANT SALES MANAGER, GRADE-1 ASSISTANT ACCOUNT MANAGER PERSONNAL TECHNICALPROJECT OFFICER OFFICERINSPECTOR ASSISTANT SALES/ASSISTANT MANAGER, GRADE-2TECHNICAL OFFICER SENIOR ACCOUNT ASSISTANT PROJECT MANAGER PERSONNAL INSPECTOR OFFICER ASSISTANT ACCOUNTING OFFICER ASSISTANT/ CLERK PURCHASE PRODUCTION PRODUCTION DEPARTEMENT MANAGER MANAGER (COTTON) (SILK)(BANGALORE) ACCOUNTANTPRODUCTIONMANAGER (HUBLI)PROJECTADMINISTOR /TECHNICAL ASSISTANTS WEAVERS Babasabpatilfreepptmba.com Page 19
  20. 20. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”DESIGN OF THE STUDY 3.1 Statement of the problem Financial analysis being an integral part of overall corporate management andit is one of the powerful tools of financial analysis. The analysis of financial statement ofK.H.D.C.L.td. is done in order to know the company’s financial position, growth rate. Etc.3.2 Objectives of the studyFor the purpose of any research, objective is must. It shows the direction with which the taskcan be accomplished. The specific objectives of the study are1) To know the financial status, long term financial position of K.H.D.C.L.td throughcomparative balance sheet.2) To know the growth rate in profit, expenses, cost of goods sold through comparative incomestatement.3) To know the proportion of various elements of income statement items to the total salesrevenue of K.H.D.C.L.td through common size income statement.4) To know the proportion of various elements of balance sheet items to the total capitalemployed of K.H.D.C.L.td through common size balance sheet.5) To know the relationships among the groups either for decisions or for future predictionthrough analysis of these two years financial statements.6) To know the progress, efficiency, paying capacity of the firm from the interpretation of thesetwo years financial statements. Babasabpatilfreepptmba.com Page 20
  21. 21. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” 3.3 Scope of the study The scope of the study is to find out financial position, growth rate in profit. It is donethrough the Balance sheet and income statement of the company for the periods 1998-99 to2007-08.3.4 Methodology This project is an analytical research where in the researcher has to use theavailable facts as information and analyze these to make a critical evaluation of materials. Thisis also an applied research with an aim to find a solution for immediate problems facingindustry or the firm. The methodologies followed in the analysis of the financial statement areComparative statement, Common size statement, Trend analysis, Ratio analysis, fund flowstatement and cash flow statement.3.5 Purpose of the study  The purpose of doing this project is mainly to make thorough a study of the financial analysis and interpretation of the company.  To access the company’s trends for the last ten years with regard to financial performance.3.6 Sources of data collection 1. Primary data: The data required for the project was collected from consulting the assisting supervisor by conducting interviewing & discussion. 2. Secondary data: The major source of data for this project was collected from annual reports, profit and loss account, manuals. Babasabpatilfreepptmba.com Page 21
  22. 22. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Plan of analysis This study is conducted with the help of statistics figures & techniques like Graphs & charts for better comparison and interpretation.Tools and techniques used for analysis The following are the methods of financial analysis used in general. 1. Comparative income statements 2. Common-size income statements 3. Comparative balance sheet 4. Common-size balance sheet. 3.7 Limitations 1. The study is done only on the Balance sheet and Profit and loss account. 2. Study is based on information provided by the company. Babasabpatilfreepptmba.com Page 22
  23. 23. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” DEPARTEMENTS OF K.H.D.C.LtdThere are totally 6 departments, namely 1) 1) Production department. 2) Finance department. 3) H.R.department. 4) Marketing department. 5) Quality control department. 6) Purchase department. I) PRODUCTION DEPARTEMENT. This department is the important for any type of industries. Because all other departments are depend on this department. Means the entire departments except finance start there work after completing the production department.PRODUCT PROFILE 1) Cotton multi thread bed sheets. 2) Plain towels. 3) Napkins 4) Plain bed sheets. 5) Turkish towel. 6) Carpet. Babasabpatilfreepptmba.com Page 23
  24. 24. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”7) Lungees.8) Polyester sari.9) Drill cloth.10) Cotton sari.The different size of yarn is requiring for weaving the different type of products. Like,1) For bed sheets, towels, 2/40 count of yarn is required2) Lunges: 2/80 count of yarn is required3) Sari: 2/100 count of yarn is required. STRUCTURE OF PRODUCTION DEPARTEMENT. CHEAP MANAGER OF PRODUCTION PROJECT ADMINSTRATOR TECHNICAL OFFICER ASSISTANT TECHNICAL OFFICER / PROJECT TRANSMITTOR UNIT SUPERVISORS WEAVERS HELPERSBabasabpatilfreepptmba.com Page 24
  25. 25. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”OBJECTIVES OF PRODUCTION DEPARTEMENT. a) maintain a good quality in a production b) Try to timely delivery of products. c) Reduce the cost of production. d) Increase the productivity. e) Keep the customer satisfaction by qualified products. FUNCTIONS OF PRODUCTION DEPATEMENT. 1) Receiving the Grey yarn. 2) It will be dyeing according to required colors.(process of coloring the yarn.) 3) Pre-pretary work 4) Weaving 5) Dispatch of ready goods to warehouse. Here there are 25 weavers, and 5 vendors are working in the gadag production centre. Weavers work on peace rate system therefore there is no any fixed working time for weavers. They may come at any time. Babasabpatilfreepptmba.com Page 25
  26. 26. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” FLOW CHART OFPRODUCTION DEPARTEMENT. Receiving the grey yarn Dyeing the yarn Pre-pretary work Weaving Packing Warehouse 1) Receiving the grey yarn: This is the raw-material for weaving clothes. Generally the K.H.D.C.L.td provides the raw-material, after testing through quality control lab. If the yarn is good quality then only it is accepted and sent to it’s all theBabasabpatilfreepptmba.com Page 26
  27. 27. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” production units. and also opinion of the unit supervisor the quality of raw- material is good. The raw-material is purchased through offering the tenders. I.e. take care by the head office. But in certain cases the production unit is order to selected mills. Send the massage to mills that dispatch the raw-materials to quality control lab. The lab checks the quality of yarn and send to the yarn required production units. The purchase department made the payment to the mills through cheques. The K.H.D.C.L.td always makes the payments through cheques only. One of the main function in this organization is there is a direct issue of raw- materials and direct pre- requiring the finished goods by paying conversion charges. The quality control labs established in HUBLI and in BANGALORE. For the present year corporation has issued 15.31 lakhs Kgs of raw-material worth of Rs 22.47 Crores to the weavers during 2007-08. 2) Dyeing according to the required colors: Dyeing means it is the process of coloring the yarn’s there are different types of dyeing namely vat dyeing, nefthol dyeing, and reactive dyeing. for bed sheets reactive dyeing is used. The color selection of dyeing made by the managers and supervisors they decide according to the market demand for which color the demand is more and sales are also more. That color dyeing is ordered. Many MSE’s purchase the ready colored yarn from the local traders. But only K.H.D.C.L.td and co-operative society at Gajendragad and also 8-10 master weavers at Gadag do the dyeing at there dye houses. dyeing is done in open tanks without any precise temperature controls and dye material circulatory system.Babasabpatilfreepptmba.com Page 27
  28. 28. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” (The dyed yarn which is ready for pre-preatary work.) 3) Pre-pretary work: This is the third stage of producing handloom products. In this stage colored yarn is there i.e. to be roll on neatly. That work is done by the women at their home. They get remuneration for that I.e. fixed by the manager. After that these rolls neatly rolled to bim. It means there are many thread of roles that are arrange according to colors and designs.Babasabpatilfreepptmba.com Page 28
  29. 29. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” (The yarn which is rolling to the bim through that the weaver weaves the Drill cloth.) 4) Weaving: This is also called as loom stage. Here weavers weave the cloth with his tactical skill. Because weaver is well known with the way of weaving. (The weaver weaving for the making Drill cloth.) 4) Dispatch to warehouse:after completing the handloom product Now the products are packed safely and send towarehouse. There are 2 warehouses those are i) grey warehouse and ii) finished warehouse. Babasabpatilfreepptmba.com Page 29
  30. 30. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”Grey warehouse means raw-material warehouse, where raw- materials are stored. And finishedwarehouse means where finished goods of materials are stored. The vehicles used fortransporting the materials and finished goods are VRL, GPT, and K.H.D.C.L.td also having itsown vehicles which can be help to dispatch the materials. There are 2 warehouse are therenamely grey warehouse and finished warehouse. • Grey warehouse: it means this is warehouse in where the semi finished grey yarn is stored which is use for further processing. For example the Drill cloth is use for further processing. • Finished warehouse: it means this is a warehouse in where the finished goods are store generally the products produced by gadag centre is dispatched to Hubli ware house. DETAILS OF PRODUCTION FOR THE YEAR 2007-08 AND 2006-07 PRODUCTION 2007-08 2006-07 VARIETY (In Lakh ) In Lakh (In Lakh ) In Lakh Rs) Rs) Silk 1.99 435.91 1.68 379.69 Janatha varieties 11.32 233.98 13.80 257.33 Non janatha varieties 42.97 917.61 40.53 905.43 Polyester 52.55 1663.43 51.35 1624.32 TOTAL 108.83 3250.93 107.36 3166.77 The total value of production of during the year is in the order of Rs 3250.93 lakhs.II) FINANCE DEPARTEMENT Babasabpatilfreepptmba.com Page 30
  31. 31. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”Finance is an important function and activity of every organization. A separate department iscreated to mange the finance such department called finance department. Such department issupervised by a head, it may be called by many names like finance manager, CEO of financeetc. The financial controller & officiating company secretary of K.H.D.C. Ltd isMr.A.KUMARSWAMY. As required under Section 619(2) of the companies’ act 1956, government ofIndia on the advice of the comptroller and auditor general of India appointed M/s Basavaraj andDileep, Charted Accountants, Bangalore as the statutory auditors for the year The main activity of the finance department is to keep all the accounts andfinancial transactions up to date. The officials involved for finance department for K.H.D.C.L.td. 1. financial controller 2. Assistant manager 3. Accounts (clerks)Financial controller and assistant manager are in top management. The accountants are workedin the each units of K.H.D.C.L.td. in the GADAG centre of production department namelyMr.SHESHAPPA working as a clerk. As the clerk of K.H.D.C.L.td they maintain monthly statement for Gadag production centre are given as follows. 1. Raw-material statement. 2. Finished goods statement. 4. Receipt and payment statement. These statements are pre-paring monthly and send to a project office. Then project office manager collects all the above statements from it’s all the units and sends these statements to the head office. Like Babasabpatilfreepptmba.com Page 31
  32. 32. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Wise head office collects financial statements from all its project offices for The pre-paration of related financial statements. Like Profit and loss accounts and Balance sheets. One of the dis-advantage of the finance department is the top management does’ not send the financial performance to its all the units of K.H.D.C.L.td. 1) Raw-material statement: This is a statement which shows the total number of raw- materials received from ware house/mills/corporations the clerk enter how much yarn is received on which day, time, quantity, price etc. and also how much yarn is issue to weavers for weaving with date, time, quantity etc. it involves the opening balance, received, transferred for consumption, and closing balance. 2) Finished goods statement: This is a statement which shows the total number of finished, semi-finished goods received from weavers and how much finished goods are dispatched to finished goods warehouse with the time of issue, place of issue, quantity of issue. it is also covers the opening balance of finished goods the received finished goods from weavers and finally how much is issued to a finished goods warehouse. 3) Receipt and Payment statement: This is a statement which shows the monthly total receipt and payment transaction. Like the payment to weavers, payment for electricity bill, payment for repairs, payment for sundry expenses. And receipt involves cash from bank, cash received from corporation, both are involve opening balance, payment made, cash received, and closing balance of both the receipt and payment statementsBabasabpatilfreepptmba.com Page 32
  33. 33. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” FINANCIAL RESULTS OF K.H.D.C.L.td FOR THE YEAR 2006-07, 2007-08 ARE SHOWN IN THE FOLLOWING SHEDULE. Particulars 2007-08 2006-07 (Rs in lakhs) Proffit/Loss before interest and description 538.85 551.57 Interest and depreciation 505.17 521.52 Proffit for the year 33.68 30.05 Prior period adjustement /FBT (+) 58.73 (+) 406.65 Net Proffit for the year 92.41 436.70DUTIES AND RESPONSIBILITIES OF FINANCE DEPARTEMENT IN K.H.D.C.L.td: a) Handling all cash and bank transaction b) Recording all Issued and Received Raw-materials, finished goods. c) Preparing budget and comparing the actual with the budget figures and bring to notice of management major variances if any d) Periodical reconciliation of all subsidiary book balances in control accounts. e) Maintaining the statutory records such as minutes of the Boards and shareholders meeting, register of charges created on the assets of the company, director interested register, fixed assets register, investment register etc. f) Filling the statutory forms as required by laws. g) Preparing and presenting financial and operating results on monthly basis. h) Calling the audit committee meeting periodically and discus the efficiency of internal control system in different areas. i) Getting the accounts audited. j) Calling and conducting the Board, committee and shareholders meeting and maintaining the minutes of the meeting. k) The proper utilization of funds provided by government for K.H.D.C.Ltd. Babasabpatilfreepptmba.com Page 33
  34. 34. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” l) Providing all the financial schemes, packages to the weavers as they are Sanctioned by the Government Of Karnataka.III) HUMAN RESOURCE DEPARTEMENT. As it name states the department is involving in the development of human resource of the organization. The productivity of the organization is increases when the organization treats the employees as an important asset but not the liability of the organization. The same way K.H.D.C.L.td is involving to encourage the weavers, employees by offering many facilities. In Gadag production centre 25 weavers, 5 vendors are there. Over all in K.H.D.C.L.td totally 12000 weavers, more than 1500-2000 employees are working in the state of Karnataka. As already said that there is no fixed working time for weavers. The Gadag center start it works at 10.30 am. And close at 6.00 pm. During this period weavers are work. Because here weavers are get there remuneration on the basis of piece rate system. Here for 1 meter Rs 10.50 is paid, paid to the weavers. For 1 Bed sheet Rs 35.50 is paid, to the weavers. Per day production average 120-140. 1 Bed sheet = 2.35. Generally wavers are appointed locally. The weavers having secondary education. Selection of candidate based on his actual work performance .means through practical observation the candidate is selected. Weaving skill is through heredity. All the persons can’t have those skills. Weavers are belonging to the devanga committee. Especially these people are having the skill of weaving; it’s like that no need to teach to the child of car painter to how to make doors, windows etc. Babasabpatilfreepptmba.com Page 34
  35. 35. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” The K.H.D.C.Ltd give the training to the weavers for up gradation of there skills. When government sponsors for the training then training is given to the weavers. There are 2 types of training is given to the weavers. Those are as below,  ADVANCE TRAINING  BASIC TRAINING. 1) Advance training: this is a training given to the weavers who are well worse with the basic knowledge of weaving .this training is given to the weavers for further up gradation of skills, when new variety of clothes are require to be produce. And to increase the productivity, new production techniques are taught to the weavers. 2) Basic training: This is a training given to those who are completely new to the field. Generally they don’t know anything about the basic knowledge of weaving. To those people the training is given.The duration of the training period from the extent of 3 to 6 months, 6 to 9 months. The training period depend on the budget given by the government. For that Training is conducted at rented building, and trainer is appointed by the top management. The basic training at HOMBAL is conducted in 1997-98 which is very name of training is STEP ( SUPPORT OF TRAINING FOR EMPLOYMENT PROGRAMS) for the rural woman’s. Benefits provided to the weavers 1) Thrift fund scheme: The Corporation is deducting 6-8%of the wages of the weavers towards thrift fund scheme and an equal amount is contributed by the corporation & is returned to the weavers also with interest at the time of retirement from job.Babasabpatilfreepptmba.com Page 35
  36. 36. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” 2) Life insurance scheme: The weavers of this corporation have been brought under a life insurance scheme in which the weavers have to pay 15% per annum. In case of any eventuality the corporation was paying Rs 5000. But at present for group, life insurance giving Rs 10000/- per family as a nominee & otherwise Rs 3000/- per family. 3) Housing scheme: The corporation was also constructed the weavers’ colonies for allotting the houses to those weavers who are not having the permanents houses. Under the Dutch government 200 housing facilities are provided in Gadag- Narasapur branch. Apart from above benefits weavers also enjoy living cum working shed. Free &current supply free spects at olden age, group insurance, docter facility, free TV, stages for drama, dance i.e. for cultural activities & a green card for ration. HEALTH INSURANCE CARD (THROUGH ICICI LOMBARD GENERAL INSURANCE COMPANY) for getting the Doctors facility. Presently Dr Ayyangowdar is appointed for Gadag weavers to get health facility. For getting this facility weavers pay Rs 50 and they enjoy 1 year service for 4 family members. In addition the weaver gets festival advance at the rate Rs 100 per year, per weaver. Also a cloth is given to them & 25% of cost is treated as subsidy & the rest is paid in installments. The corporation is also having training center when training is imported to weavers on modern techno SC/ST weavers are also trained. Duration of course is 10 months. Stipend is paid Rs 300 per year.Babasabpatilfreepptmba.com Page 36
  37. 37. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” From 1999-2000 to 2005-06 in Narasapur, Gadag District 4 sheds are undertaken. By installing 35 advanced Jacard Machines, they producing variety of products like Jacard Bed sheet, Tarkee towel polyester furnishing etc. The employees of K.H.D.C.L.td are promoted on the basis of service and their degree. Generally the K.H.D.C.L.td doesn’t appoint required employees immediately, it balance by transferring the employees from one place to other where shortage is there. Objectives of K.H.D.C.L.td towards weavers. 1) To provide continuous employment at weavers for their steady livelihood. 2) To release the weavers from the clutches of master weavers. 3) To improve the standard of living of the weavers. AVERAGE ANNUAL INCOME OF WEAVERS. Sl.NO Variety of Production Wages in Rs Production Income per products per day per meters. per month month 1 Bed sheet 3 meters 10.50 90 meters 945 2 Tarkee towel 2 meters 20 60 meters 1200 3 Polyester sari 9 meters 11.50 300 meters 3450 4 Cotton sari 7 meters 10 240 meters 2400 5 Casement 5 meters 7.50 120 meters 900 cloth 6 Drill cloth 4 meters 10.50 120 meters 1260 7 Cotton lungee 4 meters 12 90 meters 1080Babasabpatilfreepptmba.com Page 37
  38. 38. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Depending upon the efficiency of the weavers the weaving work is done. And also depending upon the size and quality of products the wage rate also change. Sometime on the basis of demand products wages are change. Generally the government changes the wage rate as per the changing needs of economy. The wage rate may change within Rs15, not more than that.IV) MARKETING DEPARTEMENT. The K.H.D.C.L.td introducing & selling its products with the brand name of “PRIYADARSHINI HANDLOOMS” THE ORIGINAL HOME OF HAND LOOMS. Here the marketing department involves the show rooms. The mainly show rooms are established in Bangalore, Hubli, Shivamogga. In Bangalore only 8-10 show rooms are there. 80% of sales made to government for the VIDYA VIKAS YOJANA. In the form of drill cloth. After weaving by the weavers it send to grey ware house, where semi- finished clothes are stored. Drill cloth is send to Grey warehouse for further production. Because there is need to make the coloring of drill cloth as per needed/ordered color by the Karnataka Primary Education Board, for its Government school children’s. The remaining 20% of sales by the janata & non janata clothes. Marketing managers are control the show rooms. Here there is a sales manager reported to the marketing managers. And there is a two assistant sales manager like grade-1, grade-2. Who are reporting to the sales manager Babasabpatilfreepptmba.com Page 38
  39. 39. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Each show room contains 25-30 Employees. The marketing manger has attended the ware house and orders the products on the basis of needs & demand of the products in the market. The K.H.D.C.L.td does not sell the products directly it sells through Retail, whole sale, S.S.D.S, V.V.Scheme etc. Weavers of K.H.D.C.L.td are not connected to the sales or marketing. They are supposed to hand over the products to K.H.D.C.L.td which is being sold through retail out-lets or in exhibition or in some times sold in bulk Quantities to other states. Hence the marketing officials if K.H.D.C.L.td will steady the common taste and plan production accordingly marketing steady is the key role in K.H.D.C.L.td. THE SEGMENT WISE SALES TURNOVER DURING THE YEAR 2006-07, 2007-08. SEGMENTS 2006-07 2007-08 Rs in Lakhs) (Rs in Lakhs) Retail sales 1496.27 1693.07 Wholesale sales 679.09 1410.07 S.S.D.S 561.85 359.03 V.V.Scheme 561.85 359.03 Other sales 22.16 51.36 Total 8770.44 9481.09 Less Discount/Rebate 451.71 593.20 Total 8318.73 8887.89 There is a highest sale by Retailers for both the years. The K.H.D.C.L.td. is desire tocontinue the maximization of sales through retailers for the coming years also. Introducing the Babasabpatilfreepptmba.com Page 39
  40. 40. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”new varieties like Silk embroidery Saris, Silk Shirts, Silk ties, Executive shirts during the year.Because the sales of these products are Very much Encouraging. In order to increase retail sales turnover, the corporation has participated at exhibitions in NH Expos & organized special sales campaigns at major cities like Bangalore, My sore, Hubli, and Belgum during the festival time. Marketing purpose the K.H.D.C.L.td. is using the various media like News paper, Radio, Pamphlet etc are used. K.H.D.C.L.td exports their products various countries like Russia, Egypt, & America. Only silk saris, Silk shirting, Cotton shirting readymade, products is exported. According to their circumstances prices are change for exports. V) QUALITY CONTROL DEPARTEMENT. This is a department where the Quality of raw-materials is checked. Generally the K.H.D.C.L.td provides the raw-material, after testing through quality control lab. If the yarn is good quality then only it is accepted and sent to it’s all the production units. And also opinion of the unit supervisor the quality of raw-material is good. The raw- material is purchased through offering the tenders. I.e. take care by the head office. But in certain cases the production unit is order to selected mills. Send the massage to mills that dispatch the raw-materials to quality control lab. The lab checks the quality of yarn and send to the yarn required production unitsThe quality control labs established in HUBLI and in BANGALORE. Hubli laboratory consist of 6 technical staff 8 helpers The flow authority of Quality control department had shown as below. MANAGER OF QUALITY CONTROL TECHNICAL OFFICER Babasabpatilfreepptmba.com Page 40
  41. 41. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” ASSISTANT TECHNICAL OFFICER PROJEC INSPECTOR Yarn testing Laboratories consists the following machines. Quality control machine C.S.P. Machine (Count Strength Product) Checks the measure of the product.VI) PURCHASE DEPARTEMENT. This is a department which is involve in the purchasing of raw-materials, i.e. grey yarn. The purchasing of Raw-material is done by the Head office. By offering the tenders. Which applicant quotes low Rate that tender is selected for supply of Raw- material.Babasabpatilfreepptmba.com Page 41
  42. 42. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” After purchasing of raw-material it is send to Quality control department for the checking of the quality of Raw-material. If the quality is standard then only it is accepted and sends to production department. Payment to suppliers is made only through cheques, but not in cash. The silk yarn prices for the during the year April 2007 was Rs 1275per k.gand prices during the year came down to Rs 1203 per kg during November 2007 and at the endof the year i.e. during the march 2008 the price was Rs 1256 per k.g. CONSTITUTION OF SUB COMMITTEE OF PURCHASE DEPARTEMENT IS INVOLVES AS BELOW. 1) Managing Director of K.H.D.C.L.td. 2) The Director on the board representing the department if Sericulture Govt.of.Karnataka. 3) The Director on the board representing the department of finance of the Govt.of.Karnataka 4) The Director on the board representing the department of Handlooms and Textiles of the Govt.of.Karnataka. FOLLOWING SHEDULE SHOWS THE YARN ISSUE TO THE WEAVERS FROM THE YEAR 1998-99 TO 2007-08.Particulars 1998-99 1999-00 00-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08Yarn issue to 4163.71 384409 2798.34 2255.15 2753.98 2709.28 2111.22 2531.27 2182.40 2247.41weavers INTRODUCTION TO THE STUDY. Babasabpatilfreepptmba.com Page 42
  43. 43. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” The K.H.D.C.L.td. is the manufacturing unit, engaged in procurement of the cloth and manufacturing of cloth products such as drill cloth, lungi, sari, etc. It is undertaking lot of activities to support the weavers who are the main producers of clothes. The study is involves financial analysis and interpretation of K.H.D.C.L.TD. itcompares the financial statements of K.H.D.C.L.td for 2 years namely 2006-07, 2007-08. Toknow the how earnings, expenses, working capital, production, sales etc are hoe muchincreased or decreased during these two years.OBJECTIVES OF THE STUDY.1) To know the financial status, long term financial position of K.H.D.C.L.td throughcomparative balance sheet.2) To know the growth rate in profit, expenses, cost of goods sold through comparative incomestatement.3) To know the proportion of various elements of income statement items to the total salesrevenue of K.H.D.C.L.td through common size income statement.4) To know the proportion of various elements of balance sheet items to the total capitalemployed of K.H.D.C.L.td through common size balance sheet.5) To know the relationships among the groups either for decisions or for future predictionthrough analysis of these two years financial statements.6) To know the progress, efficiency, paying capacity of the firm from the interpretation of thesetwo years financial statements. Babasabpatilfreepptmba.com Page 43
  44. 44. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”Meaning of financial statements: Financial statements are the consolidated and summarized form of businesstransactions which are pre-pared at the end of each accounting year. These statements reveal thefinancial information of the business enterprises for a certain period. The financial statementsare prepared for ascertainment of results of a business and communicate the accountinginformation to the users. The financial statement provides answers to the following questions. 1) What is the financial status of the firm on a particular date? 2) How is the firm’s financial performance over the period? Here for the project the profit and loss a/cs, balance sheet are used for comparative analysis and interpretation of the study. 1) Balance sheet: Balance sheet is the statement of financial position of a business concern as on specified date. It represents all the assets owned by the firm and liability owed to others. In other words, it contains the various assets, liabilities and owners equity as on particular date. The balance sheet is prepared on the basis of following equation. ASSETS = EQUITIES (A) = (E) Or Assets = Owners equity + creditors equity Or Assets = (Share capital + Reserves + surplus-Losses) +outside liabilities. Babasabpatilfreepptmba.com Page 44
  45. 45. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” 2) Income statement(Profit and loss a/cs: This statement explains the financial performance of a business concern for the particular period. It explains the net result of the business operation between two balance sheet dates. The income statement is pre- pared on the basis of revenue principle, realization principle and also on the basis of matching principle. The realized revenues are matched against its related expired cost. The result is net profit or loss for the year. The equation is as under: Revenues = gains – (Expenses + Losses) = net profit or loss. THE FINANCIAL ANALYSIS AND INTERPRETATION. The significance of financial statement not lies in their preparation but in their analysis and interpretation. Therefore analysis and interpretation is an attempt to determine the importance of financial statements. It increases the meaning of accounting data. To provide more understanding in layman’s language. That helps to forecast the future earnings, ability to pay dividend policy etc. the analysis and interpretation are 2 terms complementary to each other. For interpretation analysis is necessary. And analysis without interpretation is meaningless. ANALYSIS : “A process of grouping or sub grouping of a given data for the purpose of developing some relationships among the groups either for decisions or for future prediction” The financial analysis involves the division of facts or information on the basis of some definite plans and to classify them into groups on the basis of some conditions and presenting them in most convenient, simple and understandable. Therefore analysis involves the following:Babasabpatilfreepptmba.com Page 45
  46. 46. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” 1. Study and understanding of the data presented in the financial statements. 2. Collection of additional information necessary for interpretation. 3. presentation of the financial data in logical and simple manner 4. Grouping and sub grouping of the items given in the financial statements on the basis of common characteristics. 5. Development relationship from one group to another group for further study. 6. The data provided in the financial statements is re arranged and methodically classified for comparisons. For this purpose some standards are established for comparison such as : 1. Past year figures may be used as standard for comparison with the present year figures. 2. Future years estimated figures may be used as standards. 3. Another progressive or successful firm‘s figures may be used as standards. 4. Over all industry figures may be used as standards for a Comparison. The relationship can also be established from one item of statement to the other item of statement. E.g.Net profit or gross profit to sales, current assets to current liabilities, cost of sales to inventory, fixed assets to capital etc.INTERPRETATION: To interpret means to put the meaning of data in simple and understandablemanner to a layman. Interpretation can be made only after analysis. It is the explanation ofthe conclusion drawn from analysis in simple terms. The interpretation involves thefollowing. 1) Study of relationship among the of items of financial statements.Babasabpatilfreepptmba.com Page 46
  47. 47. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” 2) Study of trend over a period or actual data with the standard data used for comparison 3) Conclusions or inferences are put in simple terms for easy and more understanding for a common man. OBJECTIVES OF ANALYSIS AND INTERPRETATION : Following are the main objectives of analysis and interpretation of financial statements. 1. To study the earning capacity of the firm. 2. To understand the state of affairs of the business concern. 3. To study the progress of the firm. 4. To predict the future prospect of the firm. 5. To assess the efficiency of the firm. 6. To determine the firms paying capacity. 7. To measure the financial performance of the firm.USES OR ADVANTAGES OF ANALYSIS OF FINANCIAL STATEMENTS. 1) It helps to determine financial strength or weakness of the business firm. 2) It highlights the significant facts and relations which cannot be understood by mere reading of financial statements. 3) It is based on some logical and scientific method and is useful for decisions. 4) It is useful to understood multidirectional relationships of the various items of financial statements. 5) It minimizes the threat of wrong or delayed decisions. 6) It helps to evaluate correctness and accuracy of the decisions. Comparative statements Babasabpatilfreepptmba.com Page 47
  48. 48. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” Comparative financial statements are those statements which summaries andpresent related accounting data for number of years. It is an arrangement of the financialstatements in such a manner that each element of the financial statement is comparable withsame element of the financial statement of another period. Generally the financial statements oftwo periods are used for comparable study. While pre-paring comparative statements oneshould keep in mind that the accounting principles, policies should be same. Any materialchange in such principles policies etc. comparative statements useless. A comparative statement provides the following. 1. Absolute change in amount or figures. 2. Absolute change in percentages. 3. Increase or decrease in figures and percentages.Advantages of comparative statements. 1. It is helpful for inter period comparison. 2. It is helpful for inter firm comparison. 3. It is useful to study the trends of various elements of financial statements. 4.Types of comparative statements. For the purpose of comparative analysis the financial statements are classified into 2 types namely, 1) Comparative balance sheet. 2) Comparative income statement. Babasabpatilfreepptmba.com Page 48
  49. 49. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” 1) Comparative balance sheet. Under this technique the balance sheet of two different dates or balance sheets of one firm to another firm may be used for comparative study. an item or group of item of one balance sheet is compared with the same item or group of item of another balance sheet. The comparative balance sheet is helpful to study the liquidity position, financial status, long term financial position etc. following are the steps for pre-pare comparative balance sheet. I) redraft the balance sheet in vertical form. II) Pre-pare two additional columns one for absolute change and Another for percentage change. III) Study the trend (increase or decrease) and form the Opinions. IV) Interpret the same.FORMULA FOR CALCULATION OF PERCENTAGE = DIFFERENCE OF AN ELEMENT * 100 PREVOUS YEAR AMOUNT OF AN ELEMENTComparative income statements: The comparative income statement is pre-pared to study growth rate inprofitability, expenses, cost of goods sold etc. usually two years income statements arecompared. For this purpose two additional columns are prepared for recording the absolutechange and percentage change. COMMON SIZE STATEMENTS. Babasabpatilfreepptmba.com Page 49
  50. 50. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” The financial statements are pre-pared with the absolute figures. Reading ofabsolute figures is not easy for quick grasping or understanding. Therefore they are convertedinto simple figures. Such as percentages to there totals for easy understandings. In case ofbalance sheet each item of the asset is expressed to the total assets. And each liability to thetotal liability. Similarly in case of income statement each item of revenue or expenses isexpressed to total sales. When the financial statements of same concern for several years areconverted into percentages and presented for the comparative study are called comparativestatements. The total size of financial statements is fixed as 100. all the items of statements areexpressed as percentage to the total.PROCEDURE FOR PRE-PARATION OF COMMON SIZE STATEMENTS. 1) In case of balance sheet total assets and total liabilities are considered as 100. 2) Each item of asset is expressed in terms of percentage to the total assets . similarly each liability to total liability. 3) Incase of income statement total sales are treated as 100. 4) Each item of revenue and expenses is expressed as a percentage to the total sales. 5) Study of these percentages to establish relationship. 6) Interpretation of the relationship in simple terms. Mainly there are two types of common size statements. a) common size income statements b) Common size balance sheet.Common size income statements Common size income statements are pre-pared to study the proportion of variouselements of income statement items to the total sales revenue. The total sales item is considered Babasabpatilfreepptmba.com Page 50
  51. 51. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”as 100 and all other items are expressed as a percentage to the total sales. In case of increase insales tend to increase in the expenses directly Related to sales. This kind of analysis helps tostudy the operational efficiency and financial performance of the concern.Common size balance sheet. Common size balance sheet means the size of the balance sheet of various yearsor firms is to brought to a common figure. That is the totals of the assets and liabilities areexpressed in terms of percentages. The relationships are established with one item to itsrespective total and are compared with another year’s balance sheet. Alternatively capital employed may also be considered as 100 and all otheritems of the balance sheet are expressed in percentages. This kind of analysis is helpful to studythe financial position, liquidity, solvency etc of the concern in various yearsCOMPARATIVE INCOME STATEMENT OF K.H.D.C.L.TD FOR THE YEAR 98-99, 99-00. (STATEMENT 1) Babasabpatilfreepptmba.com Page 51
  52. 52. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”Particulars 1998-99 1999-2000 Absolute Absolute (In Lakhs) (In Lakhs) increase/decrease increase/decrease in Rs in %A) Net sales 7943.56 7705.45 -238.11 -2.99%Less : cost of goods sold - - - -(o.s+purchase-c.s)Material consumed 7943.56 7705.45 -238.11 -2.99%Less: manufacturing expenses(cost ofproduction) -8.4% 5864.92 5367.90 -497.02Gross profit 2078.64 2337.55 258.91 12.45%Less : operating expenses1) administration expenses 2753.39 2845.53 92.14 3.34%2) selling & distribution expenses 673.75 507.98 165.77 24.60%Operating lossAdd : non operating income(Mkt assistance under deendayalscheme, IHDS, Subsidy, other income, 1429.67 799.81 -629.86 -44.05%profit on sale of assets etc. 755.92 291.83 464.09 61.39%Less : non operating expenses.Loss on sale of fixed assets,modernization assistance to weavers, 655.54 582.66 -72.88 -11.11%other charges.Profit /loss 100.38 -290.83 -391.21 -38.72%less: prior period adjustments. Tax,bad debts etc. -92.99 +0.80 -92.19 -99.13% 7.39 -290.03 -297.42 -4026%Net profit/loss Babasabpatilfreepptmba.com Page 52
  53. 53. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”COMPARATIVE INCOME STATEMENT OF K.H.D.C.L.TD FOR THE YEAR 99-00, 00-01. (STATEMENT 2)Particulars 1999-2000 2000-2001 Absolute Absolute (In Lakhs) (In Lakhs) increase/decrease increase/decrease in Rs in %A) Net sales 7705.45 6017.77 -1687.68 -21.90%Less : cost of goods sold - - - - Babasabpatilfreepptmba.com Page 53
  54. 54. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.”(o.s+purchase-c.s) 7705.45 6017.77 -1687.68 -21.90%Material consumedLess: manufacturing expenses(cost of 5367.90 4619.93 -747.97 -13.93%production) 2337.55 1397.84 -939.71 -40%Gross profitLess : operating expenses 2845.53 2665.22 -180.31 -6.3%1) administration expenses2) selling & distribution expenses 507.98 1267.38 759.4 149%Operating lossAdd : non operating income 799.81 1068.57 268.76 33.60%(Mkt assistance under deendayalscheme, IHDS, Subsidy, other income,profit on sale of assets etc. 291.83 -198.81 -490.64 -168%Less : non operating expenses.Loss on sale of fixed assets,modernization assistance to weavers, 582.66 602.19 19.53 3.35other charges.Profit /loss -290.83 -801.00 -1091.83 375.4%less: prior period adjustments. Tax, +0.80 -152.65 -151.85 18981%bad debts etc. -290.03 -953.65 663.62 228.8%Net profit/loss COMPARATIVE INCOME STATEMENT OF K.H.D.C.L.TD FOR THE YEAR 00-01, 01-02. (STATEMENT 3)Particulars 2000-2001 2001-2002 Absolute Absolute Babasabpatilfreepptmba.com Page 54
  55. 55. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” (In Lakhs) (In Lakhs) increase/decrease increase/decrease in Rs in %A) Net sales 6017.77 9688.63 3670.86 61% - 2573.66 2573.66 100%-Less : cost of goods sold(o.s+purchase-c.s) 6017.77 7114.97 1097.2 18.23%Material consumedLess: manufacturing expenses(cost ofproduction) 4619.93 4671.27 51.34 11.1% 1397.84 2443.7 1045.86 74.81%Gross profitLess : operating expenses 2665.22 3032.36 367.14 13.77%1) administration expenses2) selling & distribution expenses 1267.38 588.66 678.72 53.55%Operating lossAdd : non operating income 1068.57 127.86 -940.71 -88.03%(Mkt assistance under deendayalscheme, IHDS, Subsidy, other income,profit on sale of assets etc. -198.81 -460.8 -261.99 13.17%Less : non operating expenses.Loss on sale of fixed assets,modernization assistance to weavers, 602.19 628.55 26.36 4.37%other charges.loss -801.00 -1089.35 -288.35 -35.99%less: prior period adjustments. Tax,bad debts etc. -152.65 -91.40 -61.25 40.12% -953.65 -1180.75 -227.1 23.81%Net profit/loss Babasabpatilfreepptmba.com Page 55
  56. 56. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” COMPARATIVE INCOME STATEMENT OF K.H.D.C.L.TD FOR THE YEAR 01-02, 02-03. (STATEMENT 4)Particulars 2001-2002 2002-2003 Absolute Absolute (In Lakhs) (In Lakhs) increase/decrease increase/decrease in Rs in %A) Net sales 9688.63 4989.75 -4698.88 48.49%Less : cost of goods sold 2573.66 - - -(o.s+purchase-c.s) 7114.97 4989.75 -2125.22 -29.86%Material consumedLess: manufacturing expenses(cost ofproduction) 4671.27 4863.52 192.25 4.11% 2443.7 126.23 -2317.47 94.83%Gross profitLess : operating expenses1) administration expenses 3032.36 2645.98 -386.38 -12.74%2) selling & distribution expenses 588.66 2519.75 1931.09 32.80%Operating lossAdd : non operating income(Mkt assistance under deendayal 127.86 1669.17 1541.31 120%scheme, IHDS, Subsidy, other income,profit on sale of assets etc. -460.8 -850.58 389.78 84.58%Less : non operating expenses.Loss on sale of fixed assets,modernization assistance to weavers, 628.55 622.26 -6.29 -1.00%other charges.loss -1089.35 -1472.84 383.49 35.20%less: prior period adjustments. Tax, -91.40 9.74 -81.66 -89.34bad debts etc. -1180.75 1482.58 301.83 25.56%Net profit/loss Babasabpatilfreepptmba.com Page 56
  57. 57. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” COMPARATIVE INCOME STATEMENT OF K.H.D.C.L.TD FOR THE YEAR 02-03, 03-04. (STATEMENT 5)Particulars 2002-2003 2003-2004 Absolute Absolute (In Lakhs) (In Lakhs) increase/decrease increase/decrease in Rs in %A) Net sales 4989.75 8565.68 3575.93 71.66% - 2441.55 2441.55 100%Less : cost of goods sold(o.s+purchase-c.s) 4989.75 6124.13 1134.38 22.73%Material consumedLess: manufacturing expenses(cost ofproduction) 4863.52 3342.10 -1521.42 -31.28%Gross profit 126.23 2782.03 2655.8 21.03%Less : operating expenses1) administration expenses2) selling & distribution expenses 2645.98 3031.93 385.95 14.58%Operating loss 2519.75 249.9 -2269.85 -90.08%Add : non operating income(Mkt assistance under deendayal 1669.17 103.71 -1565.46 -93.78%scheme, IHDS, Subsidy, other income,profit on sale of assets etc. -850.58 -146.19 -704.39 -82.81%Less : non operating expenses.Loss on sale of fixed assets,modernization assistance to weavers, 622.26 482.67 -139.59 -22.43%other charges.loss -1472.84 -628.86 -843.98 -57.30%less: prior period adjustments. Tax, 9.74 +289.88 280.14 287.6%bad debts etc. -1482.58 -338.98 -1143.6 -77.13%Net profit/loss Babasabpatilfreepptmba.com Page 57
  58. 58. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” COMPARATIVE INCOME STATEMENT OF K.H.D.C.L.TD FOR THE YEAR 03-04, 04-05. (STATEMENT 6)Particulars 2003-2004 2004-2005 Absolute Absolute (In Lakhs) (In Lakhs) increase/decrease increase/decrease in Rs in %A) Net sales 8565.68 7643.44 -922.24 -10.76% 2441.55 566.40 -1875.15 -76.80%Less : cost of goods sold(o.s+purchase-c.s) 6124.13 7077.04 952.91 15.55%Material consumedLess: manufacturing expenses(cost of 3342.10 4871.38 1529.28 45.75%production) 2782.03 2205.66 -576.37 -20.71%Gross profitLess : operating expenses1) administration expenses2) selling & distribution expenses 3031.93 2657.58 -374.35 -12.34% 249.9 451.92 202.02 80.84%Operating lossAdd : non operating income 103.71 88.69 -15.02% -14.48%(Mkt assistance under deendayalscheme, IHDS, Subsidy, other income,profit on sale of assets etc. -146.19 -363.23 -217.04 -148.46%Less : non operating expenses.Loss on sale of fixed assets,modernization assistance to weavers, 482.67 421.94 -60.73 -12.58%other charges.loss -628.86 -785.17 156.31 24.85%less: prior period adjustments. Tax,bad debts etc. +289.88 +227.37 -62.51 -21.56 -338.98 -557.80 217.82 64.25%Net profit/loss Babasabpatilfreepptmba.com Page 58
  59. 59. “ANALYSIS AND INTERPRETATION OF 10 YEARS FINANCIAL STATEMENTS OF K.H.D.C.L.td.” COMPARATIVE INCOME STATEMENT OF K.H.D.C.L.TD FOR THE YEAR 04-05, 05-06. (STATEMENT 7)Particulars 2004-2005 2005-2006 Absolute Absolute (In Lakhs) (In Lakhs) increase/decrease increase/decrease in Rs in %A) Net sales 7643.44 6998.38 -645.06 -8.43% 566.40 - - -Less : cost of goods sold(o.s+purchase-c.s) 7077.04 6998.38 -645.06 -8.43%Material consumedLess: manufacturing expenses(cost ofproduction) 4871.38 5666.15 794.77 36.03% 2205.66 1332.23 -873.43 -39.59%Gross profitLess : operating expenses1) administration expenses 2657.58 2455.14 -202.44 -7.6%2) selling & distribution expenses 451.92 1122.91 670.99 148.47%Operating lossAdd : non operating income(Mkt assistance under deendayal 88.69 1012.75 924.06 1041.8%scheme, IHDS, Subsidy, other income,profit on sale of assets etc. -363.23 110.16 -253.07 -69.67%Less : non operating expenses.Loss on sale of fixed assets,modernization assistance to weavers, 421.94 460.83 61.11 14.48% Babasabpatilfreepptmba.com Page 59

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