1. A PROJECT REPORT ON
ICI Pakistan Limited Financial Statements
analysis Submitted to: Mr.
Abdul Hameed
Submitted by: Anum Sabah Hashmi
Roll no (2) B.B.A 3 rd (M)
Subject Financial accounting
THE ISLAMIA UNIVERSITY OF BAHAWALPUR BAHAWALNAGAR CAMPUS
DEPARTMENT OF MANAGEMENT SCIENCES

2. ICI Pakistan Limited Financial
Statement s analysis
Financial statement
A.
Audit report
The audit report is qualified report because all the notes & disclosure are available &
statements free of any metrical misstatements
B.
Comment on director report
The directors are pleased to present their report of the year ended December 31,
2011 net sales income was up 14%over last year the company business recoded
strong growth in margins and operating result dividends of paid 90% for 2011&
increase 5.5per share
C. Intra analysis
Data of ICI Pakistan Limited
Financial Statements
Balance sheet

3. Data of year 2011 2010 2009 2008 2007 2006
Authorized capital 15000000 15000000 15000000 15000000 15000000 15000000
Issued capital 1388023 1388023 1388023 1388023 1388023 1388023
Capital reserves 465845 465845 465845 465845 465845 456845
Unappropriate profit 12501477 12694225 11628928 10594258 9514962 8248185
Total equity 14355345 14548093 13482796 12448126 11368830 10102053
Surplus us on asset 1713295 907352 931846 962795 1012167 1161004
Liabilities
Non current liabilities
Medical scheme 280,155 222942 183019 142250 119571 ---
Deferred tax liability- 1002576 870248 1025098 470704 _ 104,444
Current liabilities
Short-term financing -- ------ --- --- --- 144438
Trade & other payables 6113943 5482037 5799898 4446810 6263805 5478731
Contingencies &commitments
Total equity& liabilities 23456314 22030672 21422657 18470685 18764373 16990670
Assets
Non current assets
Property, plant, equipments 9614392 8895091
9225110 9361469 8546473 8620119
intangible asset 141051 180102 ---- ---- 370406 71774
Deferred tax asset –net --- ---- --- ---- - 1029589
Long –term investment 502976 712500 712500 712500 582500 2500
Long – term loans 325714 324264 330801 330605 204867 104761
Long term deposit 34266 40458 29078 30684 37357 72919
Current assets
Stores &spares 519020 456040 496401 538540 605480 750116
Stock-in-trade 4596021 3780901 3244525 2951956 2311336 2361722
Trade debts 618647 792867 919463 806612 991596 756039
Loan& advance 491733 590722 406739 193254 137680 133125
Prepayments 279370 443674 452438 404662 341129 288819
Other recoverable 740470 606280 677111 749388 683461 569842
Cash bank balance 4856496 4661822 4468251 1971081 3615056 1791786
Total assets 23465314 22030672 21422657 18470685 18764373 16990670
Income statements
Year 2011 2010 2009 2008 2007 2006
Turnover 44802489 39532506 32399181 31921873 25988351 21947688
Sales, excise dut (4687581) (4402526) (3969284) (4122958) (2964228) (2406979)
commission, &discount
sale commission 40114908 35129980 2849897 27798915 23024123 19540709
Cost of sales (33728384) (28443690 (22754005) (22303138) (18205396) (15589557

4. Gross profit 6386524 6686290 5675892 5495777 4818754 3951152
Selling expenses(1851279) (1674719) (1470174) (1317258) (1074549) (876075)
general (1692077) (1299005) (1178064) (1126159) (760201) (726459)
Expenses
Operating result 284316 3712566 3027654 3052360 2984004 2348618
Financial charges (137244) (163880) (167541) (219308) (146421) (323980)
operating charge (253267) (303426) (247590) (233699) (222345) (171266)
Income Profit
before taxation 2912151 3731516 3072506 2812778 2768523 1976395
Taxation (976438) (1302690) (1027768) (950040) (983723) (664530)
profit after taxation 1935713 2428826 2044738 1862738 1784800 1311864
1) Horizontal analysis
It mean to analyze the series of data horizontally followings the formula for the
horizontal analysis
Horizontal analysis
=current year amount –base year amount X 100
Base year amount
Horizontal analysis
=current year amount –2006 year amount X 100
2006 year amount
Horizontal analysis of income statement

5. Year 2011 HA 2010 HA 2009 HA 2008 H 2007 HA 2006
A
(RS) % (RS) % (RS) % (RS) % (RS) % (RS)
Unapprop 1250147 51 12694225 53 116289 40 1059425 28 9514962 15 8248185
riate 7 28 8
profit
Total 1435534 42 14548093 44 134827 33 124481 23 1136883 12 1010205
equity 5 96 26 0 3
Surplus 47 -21 931846 19 962795 17 1012167 1161004
us on 17132 12
assets 95
Medical 280,155 134 222942 86 183019 53 142250 18 119571 0 ---
scheme
Deferred 1002576 859 870248 73 102509 88 470704 35 _ - 104,444
tax 3 8 1 0 1
liability 0
– net 0
INVESTM 144438
ENT
Trade & 6113943 11 5482037 0.0 579989 5.8 4446810 - 6263805 14. 5478731
other 6 8 1 3
payable 8
s
Total 2345631 38 2203067 29 214226 26 1847068 8. 1876437 10 1699067
equity 4 2 57 5 5 3 0
&
liabiliti
es
9614392 11.5 8895091 3.1 922511 7.0 9361469 8. 8546473 - 8620119
Propert 0 6 0
y, plant, .
equipm 8
ents 5
Intangible 141051 96.5 180102 15 ---- ---- 370406 416 71774
asset 0 .
0
Deferred --- --- ---- --- ---- 1029589
tax
asset –
net
Long – 325714 201.9 324264 20 330801 21 330605 21 204867 95 104761
term 9 5 5
loans
Long term 34266 -53 40458 -44 29078 -60 30684 - 37357 -48 72919
deposit 5
7
Stores 519020 -30 456040 -39 496401 -33 538540 - 605480 -19 750116
&spare 2
s 8
Stock-in- 4596021 94 3780901 60 324452 37 2951956 24 2311336 -2.1 2361722

6. Horizontal analysis of income statement
2011 2010 2009 2006/base year
amount
Net sales 14.2% 3.% 23.6.9% (15589557)
,commission &
toil income
Cost of sales 18.6% 2.0% 25.0% 3951152
Gross profit -4.5% 3.3% 17.8% (876075)
Selling 10.5% 11.6% 13% (726459)
&distribution
expenses
Administration& 30.3% 4.6% 10%
general
expenses
Operating result -23.4% -0.8% 22% 2348618
Financial charges -16.3% -23.6% -2.2% (323980)
Other operating -1.6.5% 5.9% 22.8% (171266)
charges
Other operating -5.5% 15.% 5.7% 123023
Income
Profit before -220% 9.2% 21.5% 1976395
taxation
Taxation -25.0% 8.2% 26.7% (664531)
Profit after tex -20.3% 9.8% 18.8% 1311864
2. Vertical analysis
It analysis the each and every item in income statement &balance sheet

7. Formula:
Each item x100
Maximum amount
Vertical analysis of Balance sheet

8. Balance sheet 2011 2010 2009 2008
Maximum amount 2346531
Share capital
Authorized capital 63% 68% 70% 81%
Issued capital 5.9% 6.3% 6.4% 7.5%
Capital reserves 1.9% 2.1% 2.1% 2.5%
Unappropriate profit 53% 57% 54% 57%
Total equity 61% 6.6% 62% 67%
Surplus us on assets 7.3% 7.7% 4.3% 5.2%
Liabilities
Non current liabilities
Medical scheme 1% 1.27 0.85% 0.7%
%
Deferred tax liability – net 4% 39%, 4.7% 2.5%
,,,,
Current liabilities
Short-term financing ---
Trade & other payables 26% 24.8 27% 24%
%
Contingencies &commitments
Total equity& liabilities
Assets
Non current assets
Property, plant, equipments 40% 40% 43% 50%
Intangible asset 0.6% 0.8%
Deferred tax asset -net
Long –term investment 2.1% 3.2% 3.3% 3.85%
Long – term loans 1.3% 1.4% 1.5% 1.7%
Long term deposit 0.1% 0.1% 0.1% 0.1%
Current assets
Stores &spares 2.2% 2.1% 2.3% 2.9%
Stock-in-trade 19% 17% 15.1% 15%
Trade debts 2.6% 3.5% 4.2% 4.3%
Loan& advances 2.09% 2.6% 1.8% 1.0%
Trade deposit &short-tram 1.1% 2.01 2.1% 2.1%
prepayments %
Other recoverable 3.10% 2.7% 3.1% 4.05%
Taxation recoverable 3.17% 2.4% 2.1% 2.2%
Cash bank balance 20% 21.1 20% 10%

9. Vertical analysis of
Income statement
2011 2010 2009 2008
Net sales 100% 100% 100% 100%
,commission
& toil income
Cost of sales 84% 81% 80% 80%
Gross profit 15.9% 19% 20% 19%
Selling 4.6% 4.8% 5.2% 4.7%
&distribution
expenses
Administration 4.2% 3.7% 4.1% 4.1%
& general
expenses
Operating 7.1% 10.6% 10.6% 11.0%
result
Financial 0.3% 0.5% 0.6% 0.8%
charges
Other operating 0.6% 0.9% 0.9% 0.80%
charges
Other operating 1.1% 1.4% 1.6% 0.8%
Income
Profit before 7.3% 10.4% 10.8% 10.1%
taxation
Taxation 2.4% 3.7% 3.6% 3.4%
Profit after 4.8% 6.9% 7.2% 6.7%
taxation
3. Ratio analysis
1) Liquidity ratios
It describe the companies abilities to pay short run obligations and debts it
includes three ratio

10. i. Current ratio
Current ratio= current asset
Current liabilities
2011 2010 2009 2008 2007 2006
Current 12846915 11878257 11125168 8035427 9022770 7089008
asset
Current 6113943 5482037 5799898 4446810 6263805 5623169
liabiliti
es
C.A/C.L 12846915/ 11878257/ 11125168/ 8035427/ 9022770/ 7089008/
6113943 5482037 5799898 4446810 6263805 5623169
Current 2.1:1 2.1:1 1.9:1 1.8:1 1.4:1 1.2:1
ratio
2.5
2
1.5
1
0.5
0
2011 2010 2009 2008 2007 2006
II. Acid test ratio = liquid asset
Current liabilities

11. Trade debts 618647 792867 919463 806612 991596 756039
Other recoverable 740470 606280 677111 749388 683461 569842
Taxation recoverable 745158 545951 460240 419934 337032 437559
Cash bank balance 4856496 4661822 4468251 1971081 3615056 1791786
Liquid assets/total 6960771 6606920 6525065 3947015 5627145 3555226
2011 2010 2009 2008 2007 2006
Liquid assets 6960771 6606920 6525065 3947015 5627145 3555226
Current liabilities 6113943 5482037 5799898 4446810 6263805 5623169
Liquid assets / 6960771 6606920 6525065 3947015 5627145 3555226
Current liabilities 6113943 5482037 5799898 4446810 6263805 5623169
ACID TEST RATIO 1.2:1 1.3:1 1.2:1 1.0:1 0.9:1 0.6:1

12. 1.4
1.2
1
0.8
0.6
0.4
0.2
0
2011 2010 2009 2008 2007 2006
III. - WORING CAPITAL
= liquid asset-current liabilities
Current 12846915 11878257 11125168 8035427 9022770 7089008
asset
Current 6113943 5482037 5799898 4446810 6263805 5623169
liabilitie
s
C.A-C.L 12846915- 11878257- 11125168- 8035427- 9022770- 7089008-
6113943 5482037 5799898 4446810 6263805 5623169
WORKING 9732972 6396220 5325270 3588617 2758965 1465839
CAPITA
L

13. 10000000
9000000
8000000
7000000
6000000 w.c
5000000
4000000
3000000
2000000
1000000
0
2011 2010 2009 2008 2007
2. Activity ratio
It indicatives companies efficiency in term of business obligation it mean how much we
are efficient in order to inventory management and receivable management
i. Inventory turnover
2011 2010 2009 2008 2007 2006
Stores &spares 519020 456040 496401 538540 605480 750116
Stock-in-trade 4596021 3780901 3244525 2951956 2311336 2361722
Stores &spares+ (519020 (456040+ (496401+ (538540+ (605480+ (750116+
Stock-in-trade + 3780901) 3244525) 2951956) 2311336) 2361722)
4596021)
Average inventories 5115041 4236941 3740926 3490496 2916816 3111838
Cost of sales 3372838 28443690 22754005 22303138 18205396 15589557
4
Cost of sales/ (3372838 (28443690/ (2275400 (2230313 (1820539 (1558955
Average inventories 4/ 4236941) 5/ 8/ 6/ 7/
5115041) 3740926) 3490496) 2916816) 3111838)
Times 6.5 6.7 6.08 6.3 6.2 5.00

14. 7
6
5
4
3
2
1
0
2011 2010 2009 2008 2007 2006
No of days require to sell inventories
Days sell inventories = no of days in a year
Inventories turn over
Inventory times 6.5 6.7 6.08 6.3 6.2 5.00
turnover
No of Day 360 360 360 360 360 360
No days sell Day 56 54.4 60 57 58 73
days
inventorie
s
60
58
56 days
54 3-D Co
3-D Co
52
50
2011 2010 2009 2008 2007 2006

15. ii. Receivables over
= Net credit sales
Average AR
Cost of (33728384 (28443690)
sales )
Other 740470 606280
recoverab
le
Average 673375 -
AR
Note credit sales =cost of goods
Receivable turn over
= 33728384 =50.08 times
673375
No of days require to collect A/R
= No 0f days to collect A/R
A/R turnover

16. year 2011
No of days Day 360
A/R turnover times 50.0
No days sell A/R Day 56
No of days require to collect A/R
= No 0f days = 360 =7.08 days
A/R turnover 50.8
iii. Operating cycle
Formula
= inventories turnover in day + AR turnover in days
(50.6)+(7.08)=57.68
3. Profitability ratio
i. Gross margin =
Gross profit = gross profit x 100
Net sales
2011 2010 2009 2008 2007 2006
Gross 6386524 6686290 5675892 5495777 4818754 3951152
profit
Net sales , 40114908 35129980 2849897 27798915 23024123 19540709
Gross (6386524/ (6686290/ (5675892/ (5495777/ (4818754/ (3951152/
profit/ 40114908) 35129980)x1 28429897)x10 27798915)x10 23024123)x10 19540709)x10
Net sales , x100 00 0 0 0 0
15.9% 19.7% 19.1% 19.7% 20.9% 20.2%

17. 25.00%
20.00%
15.00% East
10.00% West
North
5.00%
0.00%
2011 2010 2009 2008 2007
Sales volume are increase &decries during different year
ii. Net profit /income ratio
= net income
Net sales
2011 2010 2009 2008 2007 2006
Net 1935713 2428826 2044738 1862738 1784800 1311864
incom
e
Net 40114908 35129980 2849897 27798915 23024123 19540709
sales ,
Net 1935713/ 2428826/ 2044738/ 1862738/ 1784800/ 1311864/
incom 40114908 35129980 2849897 27798915 23024123 19540709
e/
Net
sales ,
Income 0.04% 0.06% 0.07% 0.06% 0.07% 0.06%
ratio

18. 0.07%
0.06%
0.05%
0.04%
0.03%
0.02%
0.01%
0.00%
2011 2010 2009 2008 2007 2006
iii. Return on assets = net income x100
Total assets
2011 2010 2009 2008 2007 2006
Net 193571 2428826 2044738 1862738 1784800 1311864
income 3
Total 234653 22030672 21422657 18470685 18764373 16990670
assets 14
Net (19357 (2428826/ (2044738/ (1862738/ (1784800/ (1311864/
income / 13/ 22030672)1 21422657)1 18470685)1 18764373)1 16990670)1
Total 234653 00 00 00 00 00
assets 14)1
00
8.2% 11.02% 9.5% 10% 9.5% 7.7%
12.00%
10.00%
8.00%
Ea
6.00%
We
4.00%
No
2.00%
0.00%
2011 2010 2009 2008 2007 2006

19. iv. Return on investment =net income
Share holder’s equity
2011 2010 2009 2008 2007 2006
Net income 1935713 2428826 2044738 1862738 1784800 1311864
Total equity 14355345 14548093 13482796 12448126 11368830 10102053
Net 1935713/ 2428826/ 2044738/ 1862738/ 1784800/ 1311864/
income/taxatio 14355345 14548093 13482796 12448126 11368830 10102053
n
Total equity
Return on 8.2% 11.02% 9.5% 10% 9.5% 7.7%
investment
v. Earning per share = Net income - preferred
divined
Average no of share
Note - preferred divined =0
year year
Net 1935713 2428826
income
Average 1258402 1258402
number
of share
Earning 13.95 14
per
share
vi. Price earning ratio = market price

20. Earning per share
market 156.80
price
Earning 13.95
per
share
Price 11.18
earning
ratio
vii. Dividend payout ratio= dividend payout share out
Earning per share
2011 2010
dividend 2151436 1388027
payout
share
out
Earning 13.95 14
per
share
Dividen 154224 99144
d
payout
ratio
viii. Dividend yield ratio =
Dividend per share
Market price

21. Year 2011
Dividend 12/per share
Market p 156.1800
ratio 1:0.076
4. Solvency ratio
It show the obligation and debts in near future
a. Time inventory = earning before interest and tax
i. Interest expanse
earning 2912151 3731516 3072506 2812778 2768523 1976395
before
interest
and tax
Financial (137244) (163880) (167541) (219308) (146421) (323980)
charges
Time 21.2 22.7 18.3 12.8 18.9 6.1
inventor
y

22. 25
20
15 time invent
10 3-D Column
3-D Column
5
0
2011 2010 2009 2008 2007
Company ability to pay charges annually increase &decrease during the years
b. Debt equity ratio = total liabilities
Shareholder equity
(It show the owner’s equity of share holder and the equity of company)
total liabilities 7,396,674 6575227 7008015 5059764 6383376 5,727,613
Total equity 14355345 14548093 13482796 12448126 11368830 10102053
total liabilities/ 7,396,674/ 6575227/ 7008015/ 5059764/ 6383376/ 5,727,613/
Total equity 14355345 14548093 13482796 12448126 11368830 10102053
Ratio 0.5:1 0.4:1 0.5:1 0.4:1 0.5:1 0.5:1

23. 0.6
0.5
0.4
0.3
z
0.2
0.1
total
0 equity
2011 2010 2009 2008 2007 2006
Show the owner’s equity of share holder
c. Debts to asset ratio = total liabilities
Total asset
Show the owner’s equity of share holder and the equity of company
2011 2010 2009 2008 2007 2006
total 7,396,674 6575227 7008015 5059764 6383376 5,727,613
liabilitie
s
Total 23465314 22030672 21422657 18470685 18764373 16990670
assets
Debts to 0.315:1 0.31:1 0.32:1 0.2:1 0.3:1 0.3:1
asset
ratio

24. 0.35
0.3
0.25
0.2 debts to asse
0.15
0.1
0.05
0
2011 2010 2009 2008 2007 2006
Solvency abilities are constant in last years
D. Conclusion
The intra analysis indicates the company efficiency( in last six year) in term of
business operation inventory management and receivables management ,long term
&short term paid obligation ,working capital ,solvency power company show best
result in last year