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“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                                          ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”       Findings and suggestions           ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                              LIST OF TABL...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”4             Solvency Ratio              ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”“Cash and fund flow analysis and ratio ana...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”   1. The firm should concentrate on enhan...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”      After the blockade and the landing o...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”Mauritius was in 1829. But it was only whe...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”SUGAR INDUSTRY IN INDIA:      Mostly sugar...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”environment inimical (hostility, untrendly...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”Name of the Organization        :        S...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                    The following composit...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”BACKGROUND      SHREE      DOODHAGANGA    ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”         After a lot of dispute on locatio...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”               Thus over the period of two...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”Mission        •   Encourage agro-based co...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”   e) To acquire and install machinery for...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”   • ACHIVEMENTS AND AWARDS ACHIEVEMENTS •...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”   • The companies have the Honour of achi...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                                       MAN...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”          The chief by products of sugar ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                   Cane unloaded on to the...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                   The first three element...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”2. System   System refers to how the produ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”b. Distribution System            The dist...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”d. Security System                     The...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”3. Strategy   The way in which a business ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”5. Style   The style which is portrayed to...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”6. Staff   Good hard working citizen play ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”    Environment policies    T.P.M. polic...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”         Promoting automates maintenance ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”Export of sugar      When the internationa...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”enquiries to the prospective purchasers in...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”prior to the last mill to extract more pos...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”crystallizes. This masscult is purged in t...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”      Finance plays a vital role in the fu...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”      4.        Cash Section      Accounts...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”        It is looking after the payments o...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”    The important functions of the departm...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”       In the beginning of the year the pu...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                           MECHANICAL DEPA...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                                 STORES DE...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”               The lunch break is from 12:...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”OBJECTIVES   1) To secure for the worker f...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”     7)   To suggest the measure which wil...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”     • Skilled and efficient staff and lab...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”  • Offer replacement of machinery to new ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                             DESIGN OF THE...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”3.4 Methodology                  This proj...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”     Plan of analysis                    T...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”            Financial analysis is the sele...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”      The Financial statements are the end...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                                   = Liabi...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                These assets include the p...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI” c) Accounting policies       • Report of ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”          Income statement is, also known ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”4.4 ANALYSIS OF FINANCIAL STATEMENT       ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”4.5 Significance of the financial statemen...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”TECHNIQUES/TOOLS OF THE AFS       The meth...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”   • The statement of changes in financial...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                                    CHAPTE...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                                          ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”(crores) i.e., Rs.1242.47 in 2007 and Rs.1...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”from the CIS, a financial analyst can quic...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”      The selling and Administrative expen...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”     Net sales                  100       ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”   Working capital loan               22.7...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                                          ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”           Total                          ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”mass of financial data into a concise form...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI”                                          ...
“CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS              OF DKSSKN, CHIKODI‴ion_A
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi
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A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi

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A project report on cash and fund flow analysis and ratio analysis of dksskn, chikodi

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  1. 1. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Contents Titles Page No. Chapter I Executive summary 1 Chapter II • Industrial profile 3 • Company profile 7 • Organization structure 16 17 • Product profile Chapter III Design of the study • Statement of problem 42 • Objectives of the study 42 • Scope of the study 42 • Methodology of data collection 43 • Sources of data collection 43 • Limitations 44 Chapter IV Financial analysis • Financial statement 46 46 • Balance sheet 50 • Income statement 51 • Analysis of financial statement 52 • Significance of financial statement analysis 53 • Statement of changes in the financial statement Chapter V Data analysis and interpretation • Comparative financial statement • Common size financial statement • Trend analysis financial statement • Ratio analysis • Fund flow statement • Cash flow statement Chapter VI 1 Babasabpatilfreepptmba.com
  2. 2. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Findings and suggestions 55 Chapter VII 59 62 Conclusion 64 80 Chapter VIII 84 Bibliography Chapter IX 88 Annexure 89 90 91 2 Babasabpatilfreepptmba.com
  3. 3. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” LIST OF TABLES Table Name of the Table Page No. No. 1 Comparative Balance sheet 56 2 Comparative Income Statement 58 3 Common-size Income Statement 60 4 Common-size Balance Sheet 61 5 Trend Income Statement 62 6 Trend Balance Sheet 63 7 Current Ratio 65 8 Quick Ratio 67 9 Proprietary Ratio 69 10 Solvency Ratio 70 11 Fixed Assets Turnover Ratio 72 12 Working Capital Turnover Ratio 74 13 Gross Profit Turnover Ratio 76 14 Operating Cost Turnover Ratio 77 15 Return On Investment 79 16 Fund Flow Statement 81 17 Cash Flow Statement 84 LIST OF CHARTSChart Name of the Chart PageNo. No.1 Current Ratio 662 Quick Ratio 673 Proprietary Ratio 69 3 Babasabpatilfreepptmba.com
  4. 4. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”4 Solvency Ratio 715 Fixed Assets Turnover Ratio 736 Working Capital Turnover Ratio 747 Gross Profit Turnover Ratio 768 Operating Cost Turnover Ratio 789 Return On Investment 79 CHAPTER- I EXECUTIVE SUMMARY Shree D.K.S.S.K.N. Chikodi is a co-operative unit. It is a situated nearNanadi village. By conducting the organization study it is found thatAll the departments were actively working towards the achievement of the goals ofthe company.My topic is 4 Babasabpatilfreepptmba.com
  5. 5. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”“Cash and fund flow analysis and ratio analysis of DKSSKN, Chikodi” Financial statements summarizes that the financial position and operationof the company. Many companies are used comparative, ratio analysis, fund flowand cash flow analysis to know about the financial position of the firm. Thecomparative, ratio analysis, fund flow analysis and cash flow analysis are widelyused for analyzing the financial statements. It is systematic use of ratio to interpretthe financial statements so that the strength and weaknesses of a firm isdetermined. During my project the firm is not in good health and the company funds areused only for short term assets not for long term assets.My Objectives are 1. To determine the operational efficiency of the company using ratio analysis. 2. To know the changes in financial statements for the past 3 years using trend analysis. 3. To conduct cash and fund flow statement for 2007- 2008 4. To identify the financial strength and weakness that the firm might have.Suggestions 5 Babasabpatilfreepptmba.com
  6. 6. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” 1. The firm should concentrate on enhancing the operating efficiency of the firm. 2. From the study it is found that the funds are used for short term assets which should be avoided.CONCLUSION By analyzing the topic of “CASH AND FUND FLOWANALYSIS AND RATIO ANALYSIS OF DKSSKN LTD. CHIKODI” I conclude that the company liquidity position is not satisfactorydue to more concentrate on raising the fixed assets rather than operating activities.which decreases working capital of the company. Which affects the operationalefficiency of the company and also the liquidity position. CHAPTER- II INDUSTRIAL PROFILETHE BRITISHAT FIRST 6 Babasabpatilfreepptmba.com
  7. 7. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” After the blockade and the landing of British troops superior in number thanthe French force of the General Decaen, the French capitulated in December 1810.From the Treaty of Paris of 1814, Mauritius and its dependencies became British,whereas Reunion even that it was captured was given back to France. Mauritiusbecame British and got back the name the Dutch gave her, but stayed quite close toFrance as she kept the language, culture and French laws. Left on their own, underthe same legal system, the ancient French colonist and their descendants was thenable to live a French style as in the past, changing from a colony base on maritimetrade to that of an agricultural one. Even that the sugar industry started under the French period, it was onlyduring the British period that it developed in such a way that it became almost amono-crop industry until some other crops were cultivated such as tea, tobacco andmore recently small industries for food, textile and household products.ABOLITION OF SLAVERY. The most important event under the British. Administration was the abolition of slavery in 1835 EMANCIPATION OFTHE SLAVES. The emancipation of the slaves in 1835 was been opposed by thecolonists same at those of other British colonies for economic reasons since thesugar industry in development needed man power. The colonists obtained a veryhigh compensation. Then there were no trouble as expected since everything wenton calmly, but to replace for the sudden lack of human resource, the country had toask for free workers from India. The first importation of Indian human resource in 7 Babasabpatilfreepptmba.com
  8. 8. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”Mauritius was in 1829. But it was only when the slaves were emancipated that ittook importance. It resulted in an accelerated development of the sugar industry and broughtprosperity as from 1850. That prosperity of 1850 was also due to a recovery intrade. Another development during the British period: the change in theconstitution, which was slow at the start, but got speed after the second world warto bring independence in 1968.TOWODRS INDEPENDENCE It is as from 1937 with the requests of the workers and the establishment ofthe Labour Party that regrouped the colored people and certain intellectuals fromIndian origin as well as the recognition of the workers unions that progress startedto be done. There was also a new constitution after the elections of 1943 duringwhich two forth of the population could vote. The elections of 1953 madedemocracy move ahead when the Labour party obtained more seats. It was in 1957,the year when the ministerial system started in Mauritius that Dr Ramgoolam tookthe leadership of the Labour party.PICTURE OF SUGAR MAKING 8 Babasabpatilfreepptmba.com
  9. 9. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”SUGAR INDUSTRY IN INDIA: Mostly sugar industries are located in U.P, Bihar Maharashtra, A.P.Karnataka and T.N. The sugar industry is one of the largest organized industrieswith total capital investment of more than 500 crores. It employees more than 2.5lakhs of workers besides creating extensive indirect employment over 25 to 30million cultivators of sugar cane, dealers in sugar and confectioneries. When sugar industry was granted tariff protection the history of sugarindustry started again before 1932 which gave limpet us (driving force) to growthof industry. Again the government in 1951 provided incentives by fixingminimum prices of cane and maximum prices of sugar. This incentive scheme increased the production of sugar but dis-couragedthe cane production. We will see later on how contradictory government. Policieshave adversely affected the growth of sugar industry. Unfortunately, governmentpolicy has been that of control and re-control from time to time creating an 9 Babasabpatilfreepptmba.com
  10. 10. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”environment inimical (hostility, untrendly) to the growth of sugar industry. Up to1957-58 both consumption and production of sugar rose to; 20 lakhs tones each.During 1969’s production of sugar rose to 35lakshs tones and during 1970’s it wasin between 40 to 50 lakh tones. And during 2000-01 it was in-between 80 to 90lakhs tonnes.POLICY The present policy of partial decontrol 10% of production by each unitis supplied for public distribution system i.e. as levy sugar at Govt. notified pricesadmittedly below 20% of the actual cost of production. The levy sugar is I to thepublic irrespective of their economic status. The balance 90% is sold in the freemarket against monthlyissued by the Government. This policy has beencontinuing since 1967-68 except for brief periods of de-control me during the yearsof surplus production and accumulated sugar stocks.Government announces the Statutory Minimum Price (SMP) for sugarcane everyyear based on recommendations of the Commission for Agricultural Costs andPrices (CACP). COMPANY PROFILE SHREE D.K.S.S.K.N.- CHIKODI, Taluka – chikodi, dist.- Belgaum 10 Babasabpatilfreepptmba.com
  11. 11. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”Name of the Organization : Shree D.K.S.S.K.N.-Chikodi.Location : Nanadi Village. Tal.-Chikodi, Dist.- Belgaum Karnataka.Regi .office : Chikodi. Ph. No. – 08338-276931 To 35 Fax: 08338 – 276105 E-Mail – dksugar@sancharnet.comConstruction : Building Layout, Garden & Light Facilities.Capacity : 5500 tones sugar cane crashing / day. 20.7 M. W. Power Generation. 30 K.L.P.D. Restrified Spirit.Turnover : 450 to 500 Crores / Annum.Employees : 756.Work Shifts : 3 Shifts / 8 hours per shift (no Holiday) BOARD OF DIRECTORS 11 Babasabpatilfreepptmba.com
  12. 12. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” The following composition of directors on the board of ShreeDoodhaganga Krishna Sahakari Sakkare Karkhane Niyamit, Chikodi. Name Designation 1. Sri Mahantesh M Kavatagimath Chairman 2. Sri Ajit S Desai Vice Chairman 3. Sri Annasaheb S Jolle Director 4. Sri Ashok A Patil Director 5. Sri Prakash J Patil Director 6. Sri Tatyasaheb D Kate Director 7. Sri Mallikarjun G Kore Director 8. Sri Kallappa K Maishale Director 9. Sri Shantappa Y Miraji Director 10. Sri Amit P Kore Director 11. Sri Satappa N Saptasagar Director 12. Sri Parasagouda I Patil Director 13. Sri Bharatesh S Banawane Director 14. Sri Subhash N Katrale Director 15. Sri Mallikarjunayya V Hiremath Director 16. Sri Nandakumar M Nashipudi Director 17.Sri S B Umarane The Managing Director 12 Babasabpatilfreepptmba.com
  13. 13. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”BACKGROUND SHREE DOODHAGANGA KRISHNA SAHAKARI SAKKAREKARKHANE NIYAMIT, CHIKODI is a co-operative society registered underKarnataka co-operative society’s Act in 1969. The industrial license number of thefactory is L-25/N-250/-LC dated 16/10/1970. Shree D.K.S.S.K.N. Chikodi is a co-operative unit. It is a situated nearNandi village, at a distance of about 13Km from Chikodi town .and the factory atpresent has an attractive campus with magnificent buildings over it. Agriculture was continues to; be an extremely important sector in ourcountry and cooperative system, as one of its main pillars providing vital supportservices, is crucial for the transformation of agriculture. It is how inspired ourfounder Late Sri. Chidanand B Kore, an agriculturist and a co-operator, toestablish this factory during 1972-73 with the financial support from cane growersof this area and the State Government. With an initial crushing capacity 1250 TCDand as a stand alone sugar industry, lour factory had faced a lot of problems allthese years in coming out as a viable unit. Though this factory had emerged in thisarea with a meager beginning, it had not only provided a source of income forforming community but also created a sustainable employment opportunity in thisrural area. 13 Babasabpatilfreepptmba.com
  14. 14. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” After a lot of dispute on location of plant, near Nandi village, theconstruction work started in year 1971 and comp elected in the year 1974. Thefactory was inaugurated by Vice-president Shri B.D Jatti on 6th November 1974.The regular production has been started from December 1974. The factory started on 5/3/1969 with initial Crushing capacity to the extentof 1250 TCD per day began during the year 1974 with total expenditure of Rs.337lakhs. The area of operation covered 111 villages of which 102 villages are fromchikodi talukas, 5 villages are from chikodi taluka, 5 villages are from Raibagtaluka and 4 villages are from Athani taluka. At present total sugar cane supplied to this sugar industry is from 20,000acres with average yield per acre of 25 MT. The entire plant and Machinery has been supplied by m/s National HeavyEngineering Co-operative Ltd. Pune, A co-operative institution has also beeninstalled to meet the present requirement of the Crushing capacity. The DKSSK, atpresent is equipped with modern machines and skilled personals. Rs. 325 lakhslong term loan was borrowed from IFC, LIC, IDBI for original plant and Firstphase expansion and has been repaid as per their The crushing capacity was enhanced from 1250 TDC to 2000 in 1984-85and from 2000 TCD to 3000 IN 1993-94. The factory house hold expenses offactory from 3500 to 5500 TCD. Every expansion was not easy and had created afinancial set backs due to the lack of professionalism both in technical andfinancial managements. 14 Babasabpatilfreepptmba.com
  15. 15. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Thus over the period of two and half decades, the factory had grownonly in sizes but not adopted the range of different bi-product activities and hadsuffered due to a weak governance on efficiency, effectiveness, adaptability andinternal and external accountability in the management. These things have broughtthe factory almost to the brink of sickness. Besides resulting a huge negative networth and ever-high accumulated losses. However this cooperative and ruralbased industry must succeed if the poor farmers and the rural unemployed youthshave to be prosperous.Nature of Business Sugar sector is one of the large scale industries in manufacturing sector.Now a day the competition in sugar sector is very high. SHREEDOODHAGANGA KRISHNA SAHAKARI SAKKARE KARKHANENIYAMIT, CHIKODI is a co-operative society registered under Karnataka co-operative society’s Act in 1969. The object of business is to encourage properdevolvement of agricultural industrial amongst members on co-operative lives bypromotions of co-operative and joint forming methods so as to secure best meritsof modern large scale agriculture production to the owners of the lands. The natureof business is to encourage self help, thrift and co-operate amongst members.Vision, mission and quality policyVision “Total customer satisfaction” 15 Babasabpatilfreepptmba.com
  16. 16. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”Mission • Encourage agro-based co-operative industry. • To develop co-operative movement in rural sector. • To encourage the farmers to grow sugar cane for production of sugar and its by-products. AIMS & OBJECTIVE OF THE COMPANY The object of the society is to encourage proper development of AgriculturalIndustrial amongst members on Co-operative lives by promotions of principal andmethods of Co-operative and joint forming methods so as to secure best merits ofmodern large scale agriculture production to the owners of lands and for thispurpose. a) To encourage self-help, thrift and co-operate amongst members. b) To acquire lands either by way of purchase or otherwise for cultivation of sugar cane and other cost and for erection of building. Godawns staff quarters etc and for installations of machineries. c) To manufacture sugar jogger and their by products out of sugar-cane grown and supplied by members of the society and other and to sell the same to the best advantage. d) To under take such other activities as are identical and conductive to the development of the society etc. 16 Babasabpatilfreepptmba.com
  17. 17. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” e) To acquire and install machinery for the utilization of the product and buy raw material and sell finished product is the course of utilizing and marketing the by products.OWNERSHIP PATTERN The authorized share capital of the Society shall be RS.15.20 crores dividedin to total 38,000 shares of RS.4,000/-each as under. i) Rs.14,51,000/-dividend in to 36,275 shares of the face value of Rs.4,000/-each reserved for the grower members called as “A”Class. ii) Rs.9,00,000/-dividend in to 225 shares of the face value of Rs.4000/- each reserved for Co-operative Institutions. Called as “B”Class. iii) Rs.20,00,000/-dividend in to 500 shares of Redeemable preference share of Rs.4,000/-each to be issued to Government of Karnataka/Maharastra called as “C”Class. iv) Rs.40,00,000/- dividend in to 1,000 shares of face value of Rs.4,000/- each reserved for non grower members called as “D” Class.INFRASTRUCTURAL FACILITIES  Nearer to raw materials.  Good transportation facilities.  Nearer to rivers place. (Krishna River)  Good networking.  Proper accommodation for its employees 17 Babasabpatilfreepptmba.com
  18. 18. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” • ACHIVEMENTS AND AWARDS ACHIEVEMENTS • STAI, SISSTA & DSTA in their recent 8th annual convention at Hyderabad held on 13-08-2005 have honored with the most prestigious award as the “THE BEST EFFICIENCY & PERFORMANCE SUGAR FACTORY” in the country for the year 2004-05. The award was given by Hon’ble Union Minister for agricultural, food & Civil Supplies, in presence of Hon’ble Chief Minister of Andhra Pradesh. • The Karnataka State Co-op Federation Ltd. had adjudged as “The Best Co- operative Sugar Factory in the State” and AWARD had been given to us through Hon’ble Chief Minister of Karnataka, on 14/11/2004. • Energy Department of Government of Karnataka and KREDL have awarded us he “excellence Award” through Deputy Chief Minister of Karnataka for having developed efficiently 20.7 MW Co-gen Power Project on the occasion of RAJIV GANDHI AKSAYA URJA DIWAS ON 20/8/2004 . 18 Babasabpatilfreepptmba.com
  19. 19. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” • The companies have the Honour of achieving the Highest Sugar Recovery @ 11.80% in Southern part of India for the year 2001-02. And 11.90% for 2002-03 also. AwardsThe Karnataka State Cooperative Sugar Factories Federation Ltd., Bangalore hadhonored the company with the following awards for the:- 1. Highest sugar recovery in South India during 2001-02. 2. The “Best Administration Award” to the Managing Director with a cash prize of Rs .10.000/- and a certificate. 3. The Best chief Chemist Award with Rs.5,000/- Cash prize and a Certificate. 4. Best chief engineer with award worth of Rs.5,000/- cash prize and certificate. ORGANISATION CHART BOARD OF MANAGEMENT 19 Babasabpatilfreepptmba.com
  20. 20. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” MANAGING DIRECT SECRETARYGENERAL CIVIL STORE MEDICAL HEAD TIME CHIEF CHIEF AC OFFICE L.W.O. WATCH &MANAGER ENG. KEEPER OFFICER KEEPER C.D.O. OFFICER SPDT WARD TOOLROOM&DIESEL PUMPCHIEF CHIEF DIST. CO-GEN CANE AGRILENG. CHEMIST CHEMIST YARD DEVPT. GODOWN SECTION GENERAL CANE SALES CASH AC. AC. COMPUTERGAD EST MEETING INWARD & SHARE TYPING GUEST LEGAL PURC.SECTION SECTION SECTION OUTWARD SECTION SECTION HOUSE SECTION SECTION PRODUCT PROFILE  BYPRODUCTS OF SUGAR CANE 20 Babasabpatilfreepptmba.com
  21. 21. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”  The chief by products of sugar manufacturing are -1) Bagasse Bagasse is the by product of sugar left behind after crushing of sugar cane. Itis used as a fuel in the sugar factory boiler. Excess Bagasse finds use as rawmaterials in paper manufacturing industry. 2) Molasses Molasses is a by product of Sugar refining chiefly used for alcoholproduction. The entire molasses output is routed to the distillers unit which ismaintained by the organization. 3) Pressmud Pressmud is the by product generated by cane juice filtration during sugarmanufacture, currently Pressmud is used as a fertilizer in sugarcane cultivation.AREA OF OPERATION The area of operation of the society shall be confined to the followingvillages of chikodi, Athani, Raibag Talukas of Belgaum District and JamakhandiTaluka of Bagalkot District of Karnataka State and villages of shirol, kagal Talukasof Kolhapur District Maharastra State only. FLOW CHART OF SUGAR MANAFACTURING Weighed cane-hauled to crushing yard 21 Babasabpatilfreepptmba.com
  22. 22. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Cane unloaded on to the carrier Cane cut into pieces Crushed in successive millsJuice treated with line and surplus dry chaff fed into boilers & Heated as fuel SubsiderSucm clear juiceFilter cake used clear evaporatesAs manure juice Concentrated syrup Surplus syrup to vacuum pans Boiler to mane cite CentrifugalSugar molassesBaggingDispatching power alcohol portable alcohol MC KINSEY 7 S MODEL 22 Babasabpatilfreepptmba.com
  23. 23. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” The first three element are strategy, structure and system areconsidered as hardware of success, the meet four elements are style, staff, skillsand shared values / super ordinate goals are the software of any company.1. StructureThe general admission of the company is carried out by the following departmentsand these are downwards communication in the company. The information flowsfrom the top level of management to the lower levels. 23 Babasabpatilfreepptmba.com
  24. 24. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”2. System System refers to how the production system, distribution, information systemand security system is maintained in its company.a. Production System The process of production consisting of input of sugar come and output of the sugar. 24 Babasabpatilfreepptmba.com
  25. 25. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”b. Distribution System The distribution system of the products produced is in the following way:  Direct sales are made with in the state and outside the state.  Indirect sales are made outside the country and the depot sales are also made.  The producers are also sold directly to the consumers or sold to the wholesales.c. Information System Structure of information system CHAIRMAN MANAGING DIRECTOR SENIOR GENERAL MANAGER HEAD OF THE DEPARTMENT 25 Babasabpatilfreepptmba.com SECTION
  26. 26. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”d. Security System The DKSSK has strict security system. In the maintenance of accounts after the record have been closed, the records are kept in the room and closed the room is opened only with permission of higher authority. If the visitors went to inter they have to take prior permission with theauthority and after entering they are not suppose to go any dept other then thedepartment from whom they took the permission. 26 Babasabpatilfreepptmba.com
  27. 27. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”3. Strategy The way in which a business aims to improve its position in relation to itscompetition is embodies in its strategy or the way of doing something in anorganization. In DKSSK, introduce new technologies and products strategies importance in time with national objective to improve quality reliability of products there by attaining the international standards.4. Skills Skills here refer to how the training will be given to the employees and employees. The training will be given in 2 months they area) On the job This is one of the oldest method, under this method, the individual place is on the regular job and taught the skill necessary to perform that job on the job training has the advantage of giving first hand knowledge and experience under the actual working conditions. This training is given to employees.b) Off the job In this methods trainee is separated from the job situations and his attention is focused upon learning the material related to his future job performance. There is an opportunity for freedom of expression for the trainees. 27 Babasabpatilfreepptmba.com
  28. 28. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”5. Style The style which is portrayed to outside world is derived from the style andbehaviors exhibits inside organization. The internal style of the organization effectsnew staff feels thinks and does their jobs. Therefore an organization is reflection ofits structure.a) Top down / Bottom up At the time of policy framing, the style flows from top to bottom. If thepolicy has to be framed then the policy has to be taken by upper level & it flowstowards lower level. But when the opinion of the policy is to known, at that time the style flowsfrom bottom to up. This is to know the attitudes of the employees about the policywhich is framed by the upper level.b) Authoritarian / Participative Only the upper level is having the authority to make the decisions in thefactory. • Regarding policy matter Board of management will take the decision in case of policy making. • Financial matter If the financial matter is within the amount of Rs 20,000/-, ManagingDirector will take the decision. And if financial matter is more than Rs 20,000/-,then the board will take the decision. 28 Babasabpatilfreepptmba.com
  29. 29. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”6. Staff Good hard working citizen play essential role in the development of nation. Theemployees are responsible for the success or failure of company. The company has totally 778 workers are working in the company. They aredivided as follows No. of Workers 1) Permanent worker 285 2) Seasonal workers 183 3) Consolidated worker 288 4) Daily wage worker - 756Company is paying salary of Rs. 55, 00, 000 per month to its workers.7. Shared values Shared values are refers to company policies. In Mysore SugarCompany limited the following policies are maintained.  Quality policies 29 Babasabpatilfreepptmba.com
  30. 30. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”  Environment policies  T.P.M. policies (Total productivity management)  QUALITY POLICY Total customer satisfaction is our goal. To achieve this we atS.D.K.S.S.K.N. committed to produce quality white crystal sugar as per the Indiansugar standard through continual Improvement in our process, people & stakeholders.  ENVIRONMENT POLICY The DKSSK is committed to comply with the requirement of relevantenvironment regulation and standards by implementing environment managementsystem and the continually improve its effectiveness.  TOTAL PRODUCTIVE MANAGEMENT The DKSSK is committed in maximizing limited is committed inmaximizing overall plants effectiveness to make Mysore sugar company a worldclass company through total productive manufactured by 30 Babasabpatilfreepptmba.com
  31. 31. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”  Promoting automates maintenance culture.  Involving all employees and building culture.  Minimizing the losses and reduced the cost.PROCEDURE FOLLOWED IN SALE OF SUGAR, MOLASSES,BAGASSE, RECTIFIED SPIRIT AND ARRACK  SUGARDomestic Sale of Sugar The free sale released by Government of India is sold in the domesticmarket through tender system. Sugar tenders will be called periodically from thevarious sugar traders. The traders will be called advance about the grade andquantity being offered in tender over telephone. The sugar tender are some timewill be conducted at Karnataka Sugar Institute, Belgaum and also at this factorysite. The offers of K.S.I will be present at the time of tenders. The rates will becollected over telephone from the various parties along with grade and quantity ofsugar required by them. The committee will take decision on allotment of sugar tothe parties who have offered higher price. Karkhana has maintained Sugar SaleTender register for recording the offers received and allotment made to the parties.The parties who have purchased sugar in the tender will be sold against 100%payment. The rate of domestic price of sugar in the state and the rate ofneighboring sugar factories will be compared while selling the sugar in tenders. 31 Babasabpatilfreepptmba.com
  32. 32. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”Export of sugar When the international price of sugar is remunerative compared to domesticprice of sugar, we do export some of the stock of sugar. The sugar export is mainlyundertaken through the mercantile export or through EXIM Corporation NewDelhi. The price for export sugar is negotiated taking into account, the prevailinginternational sugar price and the price being offered by various sugar factories forexport of sugar. Once the rates are finalized, they will enter into agreement withthe party. Then the party will obtain a release orders from the Chief Director ofsugar, New Delhi and necessary excise bond from the concerned authority. Aftercompleting all the necessary formalities Sugar will be delivered to the party forexport against full payment of the consignment.After the export shipmen are completed, necessary documents in proof of exportof consignment will be collected from the parties. The same will be submitted tothe excise department.  Molasses Bagasses For sale of Molasses and Bagasses we use to make a vide publicity inthe various news papers in Karnataka and Maharashtra and also floating the 32 Babasabpatilfreepptmba.com
  33. 33. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”enquiries to the prospective purchasers in order to get competitive offers and betterprice realization. PRODUCTION PROCESS The main raw material in the production of sugar is. • Sugar cane. The raw materials has to go through following stages before it becomefinished product. The process in each stage is as under: STAGE: 1 SUGAR CANE SUPPLY. The harvested and transported sugar can received is weighed on the weighBridge. It is unloaded and kept on the feeder tables. It is fed to the cane carrier asper the requirement.STAGE: 2 MILLING OF CANE/ EXTRACTION OF JUICE. This cane is passed through leveler and furzier by making the fine makingthe fine chips. It is crushed through series of mills. Imbibitions hot water is added 33 Babasabpatilfreepptmba.com
  34. 34. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”prior to the last mill to extract more possible sugar. The bagasse from the last willis carried through bagasse conveyor and required quantity of bagasse is fed to theboilers and excess quality is sent for storage.STAGE: 3 CLARIFICATION AND EVAPORATIONS. The juice from all the mills is pumped to juice weighting scale. It is heatedto about 70-77’o c in the juice heaters. It is taken to continuous juice sulphitor inwhich milk of lime and sulphur dioxide gas are adjusted to maintain ph 7.0. It isagain heated in juice heaters to about 100 to 105’oc and sent to continuousclarifier. Clear juice is taken to multiple effect evaporators to concentrate up to60oc Brix. The settled mud from the bottom of the clarifier is taken to mud mixer tomix with beguile and taken to continuous vaccum filer. The filtrate is transferredto raw juice receiving tank for treatment. The adhered mud on the screens isscraped and sent out as filter cake, which will be used for composting the manure.STAGE: 4 CRYSTALLIZATION PURGING AND SUGAR MANUFACTURE The concentrated syrup from evaporator is taken to syrup sulpthitor to adjustPh 4.8 to 5.2. This is stored in the supply tanks and fed to “A” masscult boiling bytaking B-seed as a footing. It is concentrated to 92o Brix and dropped to the 34 Babasabpatilfreepptmba.com
  35. 35. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”crystallizes. This masscult is purged in the centrifugal machines. The adheredcrystals are scraped to hopper and treated with hot air and cold air blower. It issent to grader the size for gradation. This graded sugar is stared in SILOS.Weighed and bagged sugar bags are transferred to respective godowns forstocking.STAGE: 5 FURTHER PROCESS While purging A- massecuite the A-light molasses received is sent to supplytanks and fed to ‘A’- molasses is sent to supply tanks and fed to ‘B’- masscultboiling with b-grain as footing. This is purged in the centrifugals. This sugar isused as B- seed and excess is melted and fed to ‘A’- masscult’s. White purginglow purity B- Heavy molasses obtained is used for boiling C- masscult with C-grain as footing. This C- massecuite is taken for purging in C.F.W. Centrifugal machines.The final molasses is separated, weighed and sent to storage tanks. C.F.Magma issent to melt supply tanks and fed to ‘A’ massecuite boiling. C-light molassesobtained is tired in supply tanks and used for C- massecuite boiling and C-graining also.0 FINANCE AND ACCOUNTS DEPARTMENT 35 Babasabpatilfreepptmba.com
  36. 36. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Finance plays a vital role in the functioning of all industrial units. Finance isthe life blood of the organization. In sugar Industry Finance and accountsDepartment has very vital roles. The financial plan basically deals with raising andproper utilization of funds. The funds can be raised by issue of shares as well asby raising loans various sources. The finance manager supported with accountant manager and an accountantassistant looks finance department FUNCTIONS: 1. They look after the overall financial requirements of the company. 2. They see that a proper inflow and outflow of income and expenditure is maintained. 3. Costing and accounting is framed and maintained. 4. Yearly budget is framed so that each department can meet their cash requirements. 5. Budget prepared is based on sales forecasting, expenses forecasting, cost forecasting, purchase forecasting etc. which submitted by respective departments. Finance Department consists of following sub branches: 1. General Accounts Section 2. Cane Accounts Section 3. Sales Section 36 Babasabpatilfreepptmba.com
  37. 37. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” 4. Cash Section Accounts offices are the head of this department. Accountant sales manager,and head cashier assist him. Finance controlling repayment of term loans. Taking loans excepting andpayment call deposits maintains all Accounts. Payment of all bills statutory andnormal bills.As functioning of each section is summarized follows - 1. GENERAL ACCOUNTS SECTION: General Accounts are looking after the passing of bills andpayments. Management is also done by General account section and preparationof financial statements i.e., Balance sheet, profit and loss account is attended bygeneral accounts section. 2. CANE ACCOUNTS SECTION: The Bills and payment concerned to procurement of sugar cane, is attendedby cane accounts section. Payments like cane bills, transport and harvesting billsetc., are prepared and passed in cane accounts section. 3. SALES SECTION: It is looking after sales of sugar and by products molasses, Rectified spiritand other scrap materials. It is keeping records of the concerned to all salessection. 4. CASH SECTION: 37 Babasabpatilfreepptmba.com
  38. 38. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” It is looking after the payments of all general bills and salary bills apart fromcane payment and it is also looking after receipt of cash and check payment. All accounts are maintained in usual manner. Various records and books kept are: a) General ledger b) Sub ledger c) Subsidiary d) Cash book e) Vouchers. Each branch prepares trading profits and loss account and Balance as on 31 stMarch every year. And the government Auditors audits the accounts. PURCHASE DEPARTMENT Purchase Department is headed by purchase officer is responsible forpurchasing the spare parts required for the industry. The storekeeper is responsiblefor stacking quality maintaining and issuing to the concerned section. 38 Babasabpatilfreepptmba.com
  39. 39. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” The important functions of the department are: Purchasing materials • Calling quotations • Preparing C.S.Q (comparative statement quotation) • Placing before meeting for decision • Placing orders for supply of materials. • Passing bills to Accounts section for payment. PURCHASE DEPARTMENT HIERARCHY PROCEDURE OF PURCHASING PURCHASE MANAGER GODOWN SUPERVISORS STORE KEEPERS ASSISTANTS 1. DETERMINATION OF PURCHASE BUDGET: 39 Babasabpatilfreepptmba.com
  40. 40. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” In the beginning of the year the purchase manager, with the help ofproduction planning department, prepare a purchase budget. This budget quadshim in knowing what when he has to buy and also quality, Size and quantity ofpurchase. 2. DETERMINATION OF QUANTITY: The stock availability in each location is determined and compared with theactual requirements. After receiving the sales order raw materials needed arescheduled according to these order level. The stock availability in each location isdetermined and compared with actual requirements these quantities to bepurchased are determined. 3. PURCHASE ORDER: After satisfy with the quantity of materials and reputation of the supplier,purchase order is send to the supplier. Purchase order contain includes the date oforder, description of materials to be supplied made of supply. The companies ofthis send to the Head office, another to accounts departments and one copy send tothe storekeeper. 4. RECEIVING AND ISSUING RAW MATERIALS: The department heads and the storekeeper check the quality and quantity ofraw materials received respectively. The storekeeper enters the details ofpurchased materials in the store receipt book store receipt after the details areentered in the stared receipt book, the materials from the part of inventory. Thenthe general manager passes the amount for payment. 40 Babasabpatilfreepptmba.com
  41. 41. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” MECHANICAL DEPARTMENT This department is headed by General Manager and Chief Engineer.Maintenance of the sugar machinery and plant over having of the some in offseason and to run all the sugar machinery and their devices properly and smoothlyin the season and to extract cane juice for the cane in respect of less losses of sugarcontent in fazes that is more extraction. MANUFACTURE DEPARTMENT This department is headed by Chief Chemist. To manufacture the maximumquality the sugar from the cane juice of superior ISI. grade minimize the sugarlosses in bye-products to maintain the register and calculations of sugar entering inthe house and production submit day to day report of production and recoverablesugar and excise matters in the season. In the off season maintenance of theboiling house plant. WATCH AND WARD This department is headed by security officer. Security of factory andcontrol on gates and supervision day and night all over the factory area fromsecurity point of view., 41 Babasabpatilfreepptmba.com
  42. 42. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” STORES DEPARTMENT This department is headed by store keeper. To keep the sores and requiredmaterials for the factory section wise in a proper way and to maintain theirregisters and big cards of indents (order goods)FUNCTIONS: 1> Receiving the materials 2> Unfolding the packing. 3> Takes entry in store receipt Book (SRB) 4> Preparing bills after receiving quality memo back. 5> Stacking the materials. 6> Issue of materials to concerned sections as per their indents. TIME OFFICE DEPARTMENT This department is headed by head time keeper. To maintain the register ofattendance of the factory staff to prepare the pay sheets and leave records andpersonal services register of the staff. ADMINISTRATIVE OFFICE The office time is from 10.30 to 5.30pm The lunch break is from 1.30 to 2.00 pm FACTORY PREMISES Inside: from 8:30am to 5:30pm 42 Babasabpatilfreepptmba.com
  43. 43. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” The lunch break is from 12:30 to 1:30 pm AGRICULTURAL DEPARTMENT This department is headed by Cane development officer. Cane procurement,harvesting (to reap) and development of cane. To make the provision of properseed of cane to the cultivators, soil testing and proper guideline for measuring etc. CIVIL DEPARTMENT This department is headed by civil engineer. Construction of the roads forproper transport of cane in the area, civil works of the factory, maintenance of thefactory building etc. LABOUR WELFARE This department is headed by labour welfare officer. To look into thewelfare activities of the worker and solve the labour problems. The factoryprovides all the necessary facilities. The purpose of providing welfare amenities isto facilitate the development of total personality of working class for physical,mental, psychological, cultural, social, moral and intellectual development thefactory provides well planned residential accommodation, medical facilities,educational facilities, drinking and washing water, canteen, cycle stand, library etc.In addition, the factory has following non-statutory schemes for workers welfare.Consumers society, uniforms to watchman production and engineering workersetc. 43 Babasabpatilfreepptmba.com
  44. 44. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”OBJECTIVES 1) To secure for the worker fair wage. 2) To improve the working condition and express share in the increased profitability. 3) To ensure the workers security of employment and protect larger interest of the society. 4) To establish relationship between management and employees.FUNCTION: 1) To promote harmonious relation between the factory management and workers. 2) To bring to the notice of board of directors grievances of workers and to act as a liaison officer between management and labour. 3) To study and understand the point of view of labour in order to help the management to shape and formulate labour welfare policies. 4) To advice and assist the management in fulfillment of statutory and other obligations. 5) To encourage the formation of work joint production councils, co operative societies and welfare committee and supervise their work. 6) To secure the provision of amentias such as canteen, washing, first aid, shelter, rest rooms, launch rooms etc. 44 Babasabpatilfreepptmba.com
  45. 45. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” 7) To suggest the measure which will serve to raise the standard of living of workers and in general to promote their well being.SWOT- ANALYSIS- I have found some strengths and weaknesses, opportunities to the factoryduring my training period at this plant. Factory is facing some problems regardingsale of sugar under government restriction. How much government permits to sellthe sugar that much only factory has to sell not more than that it sells throughquotations. It covers small area only. Even there is no particular system forappointment of employees.STRENGHTS - • The major strength is crushing capacity and highest chimney and packing of bags per day. • It is producing own electricity it reduces the cost of electric bills. • It also sells electricity to the KPTCL. • This factory has its own trucks and some other vehicles, which reduces transportation charges. • They have foreign customers too. • Good Administration • Healthy management labour relations • Superior product quality 45 Babasabpatilfreepptmba.com
  46. 46. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” • Skilled and efficient staff and labour force • Maximum profitability due to various by products • Well structured distribution channel. • Improved infrastructure. • In total this factory has a very good organization structureWEAKNESS- • It does not have separate HR department, so the selection of employees is not satisfactory and it creates lot of burden on labour welfare officer. • Too much stock of sugar in godown. • They purchased two wheeler vehicles and trucks on loan. During off-season they remain idle, but the interest of the loan is always shooting up. • They don’t have particular employee for particular work. Anybody can do any work assigned by their respective superiors. • High cost of production. • No control on minimizing the losses in process. • Company can’t sell as much as sugar in the market at any specific time, as sugar release mechanism is controlled by government of India.OPPORTUNITIES- • It is located in the best area. Here all the resources are available in less cost. 46 Babasabpatilfreepptmba.com
  47. 47. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” • Offer replacement of machinery to new machinery for good running of factory. • Present production performance per tone is excellent. • Non-establishment of the programs to motivate and develop effective manpower. • Restricted market opportunities shirked a better price for finished products. • Reducing the overhead expenditure. • To provide comfort and convince to employees for doing the work. • To facilitate the smooth running of the manufacturing process.THREATS- The production comes under hazardous activities, competition are updating latest technology. • Due to uncertain rainfall procurement of raw material is being affected. • High competition in procurement of raw material. • The main raw material sugarcane may not sufficiently be available in future. • Change in various government policies. CHAPTER- III 47 Babasabpatilfreepptmba.com
  48. 48. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” DESIGN OF THE STUDY 3.1 Statement of the problem Financial analysis being an integral part of overall corporatemanagement and it is one of the powerful tools of financial performance analysis.The analysis of financial statement of SRSL is done in order to know thecompany’s financial position.3.2 Objectives of the study For the purpose of any research, objective is must. It shows thedirection with which the task can be accomplished. The specific objectives of the study are a) To determine the operational efficiency of the company using ratio analysis. b) To know the changes in financial statements for the past 3 years using trend analysis. c) To conduct cash and fund flow statement for 2007- 2008 d) To identify the financial strength and weakness that the firm might have. 3.3 Scope of the study The scope of the study is to find out how assets and liabilities aremaintained. It is done through the Balance sheet of the company, for the periods,2004-2005, 2005-2006, 2006-2007 and 2007-2008. 48 Babasabpatilfreepptmba.com
  49. 49. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”3.4 Methodology This project is an analytical research where in the researcher has touse the available facts as information and analyze these to make a criticalevaluation of materials. This is also an applied research with an aim to find asolution for immediate problems facing industry or the firm. The methodologies followed in the analysis of the financialstatement are comparative statement, Common size statement, Trend analysis, ratioanalysis, fund flow analysis and cash flow analysis.3.5 Purpose of the study  The purpose of doing this project is mainly to make a thorough study of the financial analysis of the company.  To access the company’s trends for the last four years with regard to liquidity performance.  The purpose also includes assessing the impact of financial analysis on liquidity strength of the company3.6 Sources of data collection 1. Primary data: The data required for the project was collected minor through primary data. That is through interviewing & discussion with concerned authorities in the company. 2. Secondary data: The major source of data for this project was collected from annual reports, profit and loss account, manuals & some more information collected through the internet. 49 Babasabpatilfreepptmba.com
  50. 50. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” 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 financial statements 2. Common-size financial statements 3. Trend percentage analysis 4. ratio analysis 5. fund flow analysis 6. cash flow analysis 3.7 Limitations 1. The study is done only on the Balance sheet and Profit and loss account. 1. Study is based on information provided by the company. CHAPTER- IV FINANCIAL ANALYSIS 50 Babasabpatilfreepptmba.com
  51. 51. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Financial analysis is the selection, evaluation and interpretation offinancial data, along with other pertinent information, to assist in investment andfinancial decision- making. Financial analysis may be used internally to evaluateissues such as employee performance, the efficiency of operations, and creditpolicies, and externally to evaluate potential investments and the credit-worthinessof borrowers, among other things. The analyst draws the financial data needed in financial analysis from manysources. The primary source is the data provided by the firm itself in its annualreport and required disclosures. The annual report comprises the incomestatements, the balance sheet, and the statement of cash flows. Certain businessesare required by securities law to disclose additional information. The financial analyst must select the pertinent information, analyze it, andinterpret the analysis, enabling judgments on the current and future financialcondition and operating performance of the firm. In this reading, we introduce youto financial ratios------ the tool of financial analysis. In financial ratio analysis weselect the relevant information---- primarily the financial statement data--- andevaluate it. We show how to incorporate market data and economic data in theanalysis and interpretation of financial ratios and we show how to interpretfinancial ratio analysis.4.1 FINANCIAL STATEMENTS 51 Babasabpatilfreepptmba.com
  52. 52. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” The Financial statements are the end product of the financial accountingprocess. The financial statements are nothing but the financial informationpresented in concise and capsule form, and the financial information is theinformation relating to the financial position of any firm. Therefore the financialstatements are the depiction of the financial position of firm. The basic source which provides the financial information is the annualreport of the company, which is presented by the company to its shareholders at theannual general meeting. This annual report contains the chairman’s report, thebalance sheet, the income statement , the auditors report together with number ofschedules, annexure etc. Though the presentation of annual report is a statutoryrequirement under the companies Act of 1956. Every firm prepares the followingfinancial statement. 1. The Balance Sheet 2. The Income Statement4.2 BALANCE SHEET The Balance sheet is regarded as the most significant and basic financialstatement of any firm. The Balance sheet is prepared by a firm to present asummery of financial position at a given point of time, usually at the end of afinancial year. It shows the statement of affairs of the firm and the contribution ofthe owners of the firm. The BS in fact balances the assets of firm against itsfinancing i.e. the total value of the assets must be equal to the total claims againstthe firm and this can be stated asTotal assets = Total claims (Debt + shareholders) 52 Babasabpatilfreepptmba.com
  53. 53. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” = Liabilities + shareholders equityThe Balance sheet includes: 1. Assets 2. Liabilities • ASSETS Assets are the monetary value of the resources that owned by theconcern at a measurable cost. A resource is valuable if it is in form of the cash orconvertible into cash or expected to benefit in the future operation of the business,an asset includes a) physical resources like land, machinery, plant, building, stocksetc. b) non physical resources like cash, securities, accounts receivables etc.)Intangible resources like goodwill, trademark and d) future benefit like expensespaid in advance. Some time some fictitious assets also show like as incorporationcost of the company discount on issue of debentures etc. • Fixed assets • Current assetsFixed assetsFixed assets are held in business for use not for sale. These assets provide long-term benefits to the concern. Fixed assets will be higher in manufacturing concern.The fixed assets involves – Tangible assets – includes land, building, machinery,equipment, furniture, fixtures etc. these assets are shown the balance sheetdeducting the depreciation there on. a) Intangible fixed assets: 53 Babasabpatilfreepptmba.com
  54. 54. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” These assets include the patents, copyright, trademarks, trade namegoodwill etc. b) Long term investment: These assets represent the firm’s long term investments likeinvestments in share, investments in debenture and bonds of other firms orgovernment bodies. c) Other non current assets: These assets are those which represent the deferred charges etc. d) Current assets: Current assets consist of cash and other sources of cash which getconverted into cash during the period of operating cycle of the firm. These assetsare owned for a short period of time. The other name of the current assets includescash, debtors, bills receivables, stock of work in progress, bank balance, advancepayment of expenses like taxes and insurance, loan and advances to customers andemployees. • LIABILITIES Liabilities are the obligations of the concern that is to pay the outsiders.CONTENS OF ANNUAL REPORT:The Shree Doodhaganga Krishna Sahakari Sakkare Karkhane Niyamit, Chikodiannual report for the year 2007-2008 contains a) Report of the board of directors b) Auditors report 54 Babasabpatilfreepptmba.com
  55. 55. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” c) Accounting policies • Report of the board of directors Directors report provides a summery of profits made and appropriated by the company and other relevant information such as industrial relations, investments, financing, reorganization, appointment of auditors and directors etc. the report of the SRSL board of directors gives a brief account of the company profit and dividend during the 2005-2006. • Auditors report Auditors report to shareholders verifies whether the balance sheet and profit and loss account provides a true and fair view of the state of a company’s affairs. Auditors should obtain all necessary informations and explanations and ensure that proper books of accounts as required by law have been prepared by the company. • Accounting policies Companies adopt different accounting policies for preparing their balancesheet and profit and loss account. Annual reports incorporate major accountingpolicies as well as changes made in current year.4.3 INCOME STATEMENTS 55 Babasabpatilfreepptmba.com
  56. 56. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Income statement is, also known as the profit and loss account or thestatement of earnings, summarizes the revenues and expenses of the firm for anaccounting period. It gives a detail of sources of income and expenses and thus itprovides the summery of the operating results of the firm for a specific period. Itmatches the revenues with the costs that are incurred in generating the revenues,and shows the difference between the two as the net profit made or net lossincurred during the period. The IS shows the results of the operations of the firmduring the period. The IS therefore, is a flow report against the BS which is a stockreport or a status report. The IS depicts the earning capacity of the firm during theperiod under consideration. Profit and loss account presents the summery of revenues, expenses andnet income of a firm. It serves as a measure of the firm’s profitability. Revenuesare amount. The main content of the income statement are:  Net sales  Cost of goods sold  Gross profit  Operating expenses  Operating income  Non operating expenses  Non operating income  Profit  Loss 56 Babasabpatilfreepptmba.com
  57. 57. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”4.4 ANALYSIS OF FINANCIAL STATEMENT AFS refers to the process of the critical examination of the financialinformation contained in the financial statement in order to understand and makedecisions regarding the operations of the firm. The AFS is basically a study of therelationship among various financial facts and figures as given in a set of financialstatements. The basic financial statements i.e. the BS and IS, already discussed inthe preceding section contain a whole lot of historical data. It is very important to analysis the financial statement to know thedifferent factors to see are behind the change in the figures of the financialstatement. Analysis of financial statements contains comparison between differentfigures of different periods, comparison.Process of the analysis of the financial statements:Financial statement analysis contains the following steps:  Analysis of all transaction one by one to determine the accounts to credited and debited evaluate all transactions to ascertain the amount involved in that.  Analysis of recording of the transactions in the journal, summaries that in ledger and preparation of trial balance.  Preparation of final accounts or financial statements.  Get different information by analyzing these statements and provide the information to the interested parties like the bankers, investors, creditors and managerial personals. 57 Babasabpatilfreepptmba.com
  58. 58. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”4.5 Significance of the financial statement analysis: The analysis of financial statement is very important for the different parties related to the concern i.e. internal users and external users. The significance of the financial statement analysis will be clear from the following points:- • This analysis simplifies, summarizes and present the accounting figures in that way that they can provide more and more information to the different parties for taking the valuable decisions. • Financial statement analysis is provide in valuable aid to management for complete the basic functions like forecasting, planning, directing, co- ordaining and control. • This analysis diagnose the financial health of the concern by evaluating different facts of the business i.e. liquidity, solvency, profitability, capital gearing etc. • The financial statement analysis involves the different ways of analysis and interpretation of the financial statements. So anyone can take the decision according to his/her requirement. • The analysis of financial statements provides important and useful information to the management as well as other users. If this analysis does not make then it is difficult to take decision from the financial statements. 58 Babasabpatilfreepptmba.com
  59. 59. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”TECHNIQUES/TOOLS OF THE AFS The methodology adopted for the AFS may be varying from one situation toanother. However, the following are some of the common techniques of the AFS: 1. Comparative financial statements 2. Common-size financial statements 3. Trend percentage analysis 4. Ratio analysis 5. Fund flow analysis 6. Cash flow analysis The ratio analysis is the most common, comprehensive and powerful tool ofthe AFS.4.6 STATEMENT OF CHANGES IN FINANCIAL POSITION Two basic financial statements of importance to owners, management andinvestors are Balance sheet and profit and loss account. Balance sheet gives asummery of firm’s resources(assets) and obligations ( liabilities and owners equity)at a point of time, the profit and loss account reflects the result of the businessoperations by summarizing revenues and expenses during a period of time. Boththese statement fail to explain the changes in assets and liabilities and ownersequity. This statement is intended to summaries. • Changes in assets and liabilities resulting from financial and investment transactions during the period, as well as those changes which resulted due to change in owner’s equity. 59 Babasabpatilfreepptmba.com
  60. 60. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” • The statement of changes in financial position deals with the flow of funds during the year i.e., the funds coming in and going out of the firm. It summarizes the sources from where the funds might have been arranged by the firm and the uses for which the funds might have been used by the firm during the year. The following are the important concepts of funds. • The term funds may be taken to refer to cash only. This is a general notation of the term funds and is used for expressing the liquidity of a firm. Therefore, a SCFP based on this concept of funds will report and include only those transaction which are affecting the cash balance, such SCFP will be just a summery of the cash transactions. Hence, non- monetary transaction such as purchase of fixed assets by issue of debenture will not be reported in a SCFP. • The term funds may also be used to denote the net working capital of the firm. The net working is the difference between the total current assets and total current liabilities. Since, cash is only one of the several current assets; this view of the term funds is broader than the preceding concept. A SCFP prepared on the basis of the net working capital concept of funds will include all those transactions which affect the net working capital of the firm. So, any transaction affecting current assets or current liabilities will find place in the SCFP. However, there may be different transaction which do not affect the net working capital and therefore, will be outside the scope of SCFP. 60 Babasabpatilfreepptmba.com
  61. 61. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” CHAPTER-V DATA ANALYSIS AND INTERPRETATION5.1 COMPARATIVE FINANCIAL STATEMENL (CFS) In CFS, two or more BS and/ or the IS of a firm are presentedsimultaneously in columnar form. The financial data for two or more years areplaced and presented in adjacent columns and thereby the financial data isprovided a times perspective in order to facilitate periodic comparison. The preparation of the CFS is based on the premise that a statement coveringa period of a number of years is more meaningful and significant than for a singleyear only, and that the financial statement for one period represent only 1 phase ofthe long and continuous history of the firm.The CFS can be prepared for both the BS and the IS.5.1 a) COMPARATIVE BALANCE SHEET (CBS) The CBS shows the different assets and liabilities of the firm on differentdates to make comparisons of absolute balances and also of changes if any, fromone date of another. The CBS may be helpful in analyzing and evaluating thefinancial position of the firm over a period of number of years. 61 Babasabpatilfreepptmba.com
  62. 62. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Table No. 1 SHREE DOODHAGANGA KRISHNA SAHAKARI SAKKARE KARKHANE NIYAMIT, CHIKODI Comparative Balance Sheet (Amts in crores)Particulars 2006-2007 2007-2008 INCREASE/ INCREASE / DECREASE DECREASE(Amt) (%tage)LIABILITIES -Share Capital 132.19 133.66 1.47 1.12Reserves & Surpluses 676.80 757.90 81.10 11.99Term loan 409.49 502.83 93.34 22.80Working capital loan 912.46 717.85 (194.61) 21.33Bank O. D. payable 8.40 12.83 4.43 52.74Statutory and other deposits 683.18 666.17 (17.01) 2.49Suspense, sundries & other 555.99 471.07 (84.92) 15.28Total 3378.51 3262.31 (116.20) 3.44ASSETS -Fixed assets 1296.30 1307.44 11.14 0.86Investments 2.62 16.73 14.11 583.55Current assets 1242.47 1039.87 (202.6) 16.31Loans and advances 48.55 101.44 52.89 108.94Debtors 272.93 274.33 1.40 0.52Cash in hand 0.32 0.30 (0.02) 6.25Cash at bank 158.33 132.40 (25.93) 16.38Profit and loss account 356.99 389.80 32.81 9.19Total 3378.51 3262.31 (116.20) 3.44 INTERPRETATIONCurrent assets The investments in the current assets are low and it has decreasing trendover the period under study. The current assets have decreased by Rs. 202.60 62 Babasabpatilfreepptmba.com
  63. 63. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”(crores) i.e., Rs.1242.47 in 2007 and Rs.1039.87 in 2008. So it is significantlyeffects on the liquidity position of the company and it also decrease the workingcapital of the company.Net fixed assets The net fixed assets increased by 11.14(crores) i.e., almost 1307.44 in 2008when composed to 2007. So it is increased the financial performance of thecompany.Investments There is change in investments for comparing the previous year and thecurrent year. For previous year it will be Rs. 2.62 (crores) and for current year itwill be Rs. 16.73 (crores).Current liabilities Current liabilities include current liabilities and provisions. Currentliabilities and provisions decreased by Rs.275.10(crores) i.e., about Rs.1476.85 in2007 when composed to Rs.1201.75 in 2008.. Reserve and surplus The Reserve and Surplus has increased by Rs.81.10(crores) i.e, aboutRs.676.80 in 2007 to Rs.757.90 in 2008. 5.1 b) COMPARATIVE INCOME STATEMENT (CIS) A CIS shows the figure of different items of the IS of the firm inabsolute terms, the absolute changes from one period to another and if desired, thechanges in percentage form. The CIS is helpful in deriving meaningful conclusionsregarding changes in sales volume, cost of goods sold, different expenses items etc. 63 Babasabpatilfreepptmba.com
  64. 64. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”from the CIS, a financial analyst can quickly ascertain whether sales are increasingor decreasing and by how much amount or by how much percentage. Table No. 2 SHREE DOODHAGANGA KRISHNA SAHAKARI SAKKARE KARKHANE NIYAMIT, CHIKODI COMPARATIVE INCOME STATEMENT (Amounts in crores) 2006-2007 2007-2008 Increase/decrease Increase/decreaseDetails AMOUNT (%tage)IncomeSales (Revenues) 1640.81 1773.10 132.29 8.07Other Income 10.48 3.25 7.23 68.99Total 1651.29 1776.35 125.06 7.58ExpenditureCost of goods sold 1517.95 1624.81 106.86 7.04Gross Profit 133.34 151.54 18.2 13.65Selling and AdministrationExpense(operating exp) 40.23 94.75 54.52 135.52Operating income 42.35 1.36 40.99 96.79Non operating exp 124.37 161.62 37.25 29.95Non operating income 7.13 70.66 63.53 891.03Loss 18.22 32.81 14.59 80.08 INTERPRETATION On the basis of comparative income statement it can be said that gross profitfor the year 2006 has increased by Rs.18.20 over the profit for the year 2008. TheNet sales during the same period have increased by Rs.132.29. The cost of goodssold increased by Rs.106.86. 64 Babasabpatilfreepptmba.com
  65. 65. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” The selling and Administrative expenses increased by 135.52% Nonoperating income for the year 2008 is increased by 891.03%. The non operatingexpense is increased by 29.95% during the year 2008. The Net loss is increased80.08%. 5.2 COMMON SIZE STATEMENT The CSS represents the relationship of different items of a financialstatement with some common item by expressing each item as a percentage of thecommon item. In common size Balance sheet, each item of the Balance sheet isstated is stated as a percentage of the total of the Balance sheet. Similarly incommon size income statement, each item is stated as percentage of the net sales.The percentage for different items is computed by dividing the absolute amount ofthat item by the common base and then multiplying by 100. The percentage socalculated can be easily compared with the corresponding percentages in someother period. Table No. 3 SHREE DOODHAGANGA KRISHNA SAHAKARI SAKKARE KARKHANE NIYAMIT, CHIKODI COMMON SIZE INCOME STATEMENT (Amts in crores) Particulars 2005 2006 2007 2008 65 Babasabpatilfreepptmba.com
  66. 66. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Net sales 100 100 100 100 less-cost of goods sold 79.08 96.78 92.52 91.64 G.P. 20.89 3.22 7.49 8.37 less-selling &administrative exp 24.25 11.28 2.46 5.35 Add-operating income 21.13 1.30 2.59 0.08 Less-Non operating exp 15.45 6.93 7.58 9.12 Add-Non operating income 0.24 0.79 0.44 3.99 Profit 2.56 0.48 Loss 12.90 2.04 Table No. 4 SHREE DOODHAGANGA KRISHNA SAHAKARI SAKKARE KARKHANE NIYAMIT, CHIKODI COMMON SIZE BALANCE SHEET (Amts in crores) Particulars 2004-05 2005-06 2006-07 2007-08 LIABILITIES - Share Capital 3.91 3.44 3.92 4.10 Reserves & Surpluses 16.74 18.14 20.02 23.23 Term loan 19.25 16.43 12.12 15.42 66 Babasabpatilfreepptmba.com
  67. 67. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Working capital loan 22.75 25.23 27.01 22.01 Bank O. D. payable 0.96 0.18 0.25 0.40 Statutory and other deposits 27.24 23.73 20.23 20.41 Suspense, sundries & other 9.15 12.85 16.45 14.43 Total 100 100 100 100 ASSETS - Fixed assets 40.18 39.31 38.37 40.08 Investments 0.05 0.07 0.08 0.52 Current assets 45.71 48.67 36.78 3.11 Loans and advances 1.80 1.55 1.44 31.86 Debtors 8.79 7.95 8.08 8.41 Cash in hand 0.05 0.04 0.01 0.01 Cash at bank 2.97 1.97 4.67 4.06 Other assets 0.45 0.44 - - Profit and loss account - - 10.57 11.95 Total 100 100 100 1005.3 TREND PERCENTAGE ANALYSIS The TPA is a technique of studying several financial statementsover a series of years. In TPA the trend percentage are calculated for each item bytaking the figure of that item for some base year as RS. 100. So, the trendpercentage is the percentage relationship which each item of different years bearsto the same item in the base year. Any year may be taken as the base year, butgenerally the starting/initial year is taken as the base year. So, each item for baseyear is taken as 100and then the same item for other years is expressed as apercentage of the base year. Table No. 5 SHREE DOODHAGANGA KRISHNA SAHAKARI SAKKARE KARKHANE NIYAMIT, CHIKODI TREND ANALYSIS INCOME STATEMENT 67 Babasabpatilfreepptmba.com
  68. 68. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” (Amounts in crores) Trend percentage (%) Particulars 2006 2007 2008 Sales 100 120.17 129.86 Less- cost of sales 100 114.87 122.96 Gross profit 100 279.49 337.33 Less- admin & selling exp. 100 26.14 61.56 Add- operating income 100 238.73 7.67 Less- Non operating exp 100 135.53 59.54 Add- Non operating income 100 0.33 57.13 Profit 100 66.64 Loss 100 660.38 Table No. 6 SHREE DOODHAGANGA KRISHNA SAHAKARI SAKKARE KARKHANE NIYAMIT, CHIKODI TREND ANALYASIS BALANCE SHEET (Amounts in crores) Particulars 2005-2006 2006-07 2007-08 LIABILITIES - Share Capital 100 1206.93 1220.30 Reserves & Surpluses 100 117.22 131.27 Term loan 100 96.13 78.28 Working capital loan 100 113.62 89.39 Bank O. D. payable 100 139.07 212.41 Statutory and other deposits 100 90.44 88.19 Suspense, sundries & other 100 135.88 115.12 Total 100 106.12 102.47 ASSETS - Fixed assets 100 103.60 104.50 Investments 100 103.98 666.53 Current assets 100 80.18 67.10 Loans and advances 100 98.41 205.63 Debtors 100 107.83 108.38 Cash in hand 100 28.31 26.54 Cash at bank 100 251.79 210.55 Other assets 100 - - Profit and loss account 100 - - 68 Babasabpatilfreepptmba.com
  69. 69. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Total 100 106.12 102.47INTERPRETATION:Current Assets and Current Liabilities Current assets and current liabilities have declined in current year. Itaffected the liquidity of a company. Current assets are 67.10% in 2008 and CurrentLiabilities are 128.08% in 2008.Net fixed assets The net fixed assets increased in 2008 by 104.50% and 103.60 in 2007. Itshows the company is more invested in fixed assets.Investments There is change in investments for comparing the base year and the currentyear. For previous year it will be 103.98% and for current year it will be 666.53%.5.4 RATIO ANALYSISMEANING Ratio analysis is a widely-used tool of financial analysis. It is defined as thesystematic use of ratio to interpret the financial statements to that the strength andweaknesses of a firm as well as its historical performance and current financialcondition can be determined. A ratio is relationship expressed in mathematicalterms between two individual and groups of figures connected with each other insome logical manner. The relationship between two or more accountingfigures/groups is called financial ratio. A financial ratio helps to summarize a large 69 Babasabpatilfreepptmba.com
  70. 70. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI”mass of financial data into a concise form and to make meaningful interpretationand conclusion about the performance and positions of a firm.TYPES OF RATIORatio can be classified into four broad groups: • LIQUIDITY RATIOS • LEVERAGE RATIOS • ACTIVITY RATIOS • PROFITABILITY RATIOSLIQUIDITY RATIO Liquidity ratio measures the ability of the firm to meet its current obligation.In fact, analysis of liquidity needs the preparation of cash budgets and cash andfund flow statements; but liquidity ratio, by establishing a relationship betweencash and other current assets to current obligation, provide a quick measure ofliquidity. The most common ratios which indicate the extent of liquidity are:Current ratioQuick ratio • Current ratio The current ratio is calculated by dividing current assets by current liabilities: Current ratio = current assets _______________________ 70 Babasabpatilfreepptmba.com
  71. 71. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI” Current liabilitiesCurrent assets include cash and those assets which can be converted into cashwithin a year, such as marketable securities, debtors and inventories. The standardratio is 2:1. Table No. 7 CHART SHOWING CURRENT ASSETS TO CURENT LIABILITIES 2004- 2005- 2006- 2007- Details 05 06 07 08 1. CURRENT RATIO 1.51 1.25 1.41 1.21 1402.8 1521.0 1673.7 Current Assets 8 7 4 1446.92 1216.5 1472.9 Current Liabilities 932.47 0 5 1200.52 71 Babasabpatilfreepptmba.com
  72. 72. “CASH AND FUND FLOW ANALYSIS AND RATIO ANALYSIS OF DKSSKN, CHIKODI‴ion_A

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