Finance for Non-Finance Decision Making

1. Training
on
Finance for Non Finance-
Decision Making

2. ICE Breaking Session
•All participants work in Pair and get to know each other
on the following issues :
• Name and current role
• Family status and Hobby
• Any special achievement so far in your life
• Expectation from this course
The participants would spend 5 minutes to know each
other and once you go back to your table one by one
each employee will introduce his opposite partner.

3. Program Objectives
•Help managers gain an appreciation of the finance
function and its contribution to the business
•Introduce non-finance managers to basic financial
accounting principles necessary to understand financial
state of business
•Equip managers with finance tools for effective business
decision making

4. Program Contents
•Role of Finance
•Financial Statements
•Key Finance Functions and Ratios
•Financial Plans & Budgets
•Case Study (Referred throughout the Program)

5. Role of Finance

6. Role of Finance
• Traditionally, the finance department’s role has
been mainly to fulfil responsibilities such as
– Record financial transactions (book keeping)
– Take care of payment & revenue (Accounts payable,
Revenue assurance)
– Performance Mgmt (Budgeting, costing)
– Internal control (Audit, reconciliation, Cost
management)

7. Role of Finance
• In the modern era the finance functions role and
contribution has evolved to reflect changing
requirements
– Business partner (i.e. Supply chain Finance)
– Performance Management (Strategic Planning,
Dashboard etc)
– Project valuation/Feasibility study (merger, acquisition,
expansion etc)
– Competition analysis/Benchmarking

8. Role of Finance
• In addition, finance is usually the custodian for
essential business activities such as,
– Taxation
– Secretarial function
– Investor relations/Shareholder services
– Compliance with Law (i.e. Companies act)
– Regulatory relations (e.g. NBR)

9. Financial Statements

10. Key Topics
• Understand the double entry system of book keeping
• Draw up simple profit and loss and balance sheet
• Familiarize with accounting assumptions, concepts and
policies

11. BASICS OF ACCOUNTING

12. • Resources in the business = Resources
supplied by the owner
• Resources in the business = Owners’
resources + Borrowed resources
• Assets = Capital + Liabilities
The Accounting Equation

13. • Assets : Property of all kinds acquired with the
objective of earning a short term or long term
benefit. Examples are buildings, machinery, stock
of goods, motor vehicles, debtors, cash at bank etc
• Liabilities : Money owed by business for goods or
serviced purchased. Also includes long term and
short term loan
• Capital: Owners’ equity or net worth of the
business.
Definitions

14. Capital Expenditure
• Expenditure on acquiring assets that are of a
permanent nature
• Expected to yield benefit of an enduring nature
• Normally results in increase of earning capacity of
the business
• Examples: plant and machinery, buildings, motor
vehicles

15. Revenue Expenditure
• Expenses that yield benefit of a short term nature
• Normally incurred to maintain the existing earning
capacity of the business
• Examples : salaries, rent, utilities, repairs,
advertisement

16. • Introduction of share capital of
Tk.50,000

17. Assets:
Cash at bank 50,000
50,000
Liabilities:
Capital 50,000
50,000
Balance Sheet
Effect of business transactions
Introduction of capital:

18. • Purchase of an asset ( Building ) by
Tk. 30,000

19. Assets:
Buildings 30,000
Cash at bank 20,000
50,000
Liabilities:
Capital 50,000
50,000
Balance Sheet
Effect of business transactions
Purchase of an asset by cheque:

20. • Inventory purchase on Credit of Tk.
5000 for sale

21. Assets:
Buildings 30,000
Stock of goods 5,000
Cash at bank 20,000
55,000
Liabilities:
Capital 50,000
Creditor 5,000
55,000
Balance Sheet
Effect of business transactions
Purchase of an asset and incurring of a liability:

22. • Sale of Stock worth Tk. 3000 on
credit ( the cost of the goods were
Tk. 2,000)

23. Assets:
Buildings 30,000
Stock of goods 3,000
Debtor 3,000
Cash at bank 20,000
56,000
Liabilities:
Capital 50,000
Profit 1,000
Creditor 5,000
56,000
Balance Sheet
Effect of business transactions
Sale of an asset on credit (Stock costing 2,000
sold for 3,000)

24. • Remaining stock of Tk. 3000 sold
at Tk. 4000 as Cash

25. Assets:
Buildings 30,000
Debtor 3,000
Cash at bank 24,000
57,000
Liabilities:
Capital 50,000
Profit 2,000
Creditor 5,000
57,000
Balance Sheet
Effect of business transactions
Sale of an asset on cash (Stock costing 3,000
sold for 4,000)

26. • Payment to the creditor for old
purchase of Tk. 5000

27. Assets:
Buildings 30,000
Debtor 3,000
Cash at bank 19,000
52,000
Liabilities:
Capital 50,000
Profit 2,000
52,000
Balance Sheet
Effect of business transactions
Payment of a liability (creditor paid off)

28. • Realised from Debtor of Tk. 3000
through cheque

29. Assets:
Buildings 30,000
Cash at bank 22,000
52,000
Liabilities:
Capital 50,000
Profit 2,000
52,000
Balance Sheet
Effect of business transactions
Collection of an asset (debtor pays cheque)

30. Equality of the Accounting
Equation
Example of
Transaction
Effect
Buys goods on credit Increase of asset
(Stock of goods)
Increase liability
(Creditors)
Buys goods by cheque Increase asset
(Stock of goods)
Decrease asset
(Bank)
Pays creditor by
Cheque
Decrease asset
(Bank)
Decrease liability
(Creditors)
Owner pays more capital Increase asset
(Bank)
Increase capital

31. Equality of the Accounting
Equation
Example of
transaction
Effect
Owner takes money out
of the business
Decrease asset
(Bank)
Decrease capital
Owner pays creditor from
private money outside the
firm
Decrease liability
(Creditor)
Increase capital

32. The Double Entry System
Debit (Dr)
Credit (Cr)

33. Debit (Dr) Credit (Cr)
Assets/ Expenses
Increase Decrease
The Double Entry System

34. Debit (Dr) Credit (Cr)
Liability/ Income
Decrease Increase
The Double Entry System

35. Introduction of capital into the business
Bank
Capital 50,000
Dr Cr
Capital
Dr Cr
Bank 50,000
The Double Entry System

36. Purchase of building by cheque
Bank
Capital 50,000
Dr Cr
Building
Dr Cr
Bank 30,000
Building 30,000
The Double Entry System

37. Purchase of stock of goods on credit
Purchase
Creditor 5,000
Dr Cr
Creditor
Dr Cr
Purchase 5,000
The Double Entry System

38. Sale of stock of goods on credit
Sales
Debtor 3,000
Dr Cr
Debtor
Dr Cr
Sales 3,000
The Double Entry System

39. Sale of stock of goods on cash
Bank
Capital 50,000
Sales 4,000
Dr Cr
Sales
Dr Cr
Debtor 3,000
Bank 4,000
Building 30,000
The Double Entry System

40. Creditor paid by cheque
Bank
Capital 50,000
Sales 4,000
Dr Cr
Creditor
Dr Cr
Purchase 5,000
Building 30,000
Creditor 5,000
Bank 5,000
The Double Entry System

41. Debtor pays by cheque
Bank
Capital 50,000
Sales 4,000
Debtor 3,000
Dr Cr
Debtor
Dr Cr
Bank 3,000
Building 30,000
Creditor 5,000
Sales 3,000
The Double Entry System

42. PROFIT & LOSS
BALANCE SHEET

43. PROFIT & LOSS
TRIAL BALANCE:
Debit Credit
Asset 1000
Liabilities 900
Expenses 400
Income 500
Total 1400 1400

44. BALANCE SHEET
TRIAL BALANCE:
Debit Credit
Asset 1000
Liabilities 900
Expenses-Income 
Income - Expense 100
Total 1000 1000

45. Cost Centers
• Who has incurred cost
• CostCenter-2007-02-26.xls

46. Chart of Accounts
• How the income and
expenditures are recorded in an
organized way
• COA-2007-09-25.xls

47. Ledger
• All transactions of one particular
account code is recorded in the
ledger
Date Particu
lars
Debit Credi
t
or Dr /
(Cr)
1/1/2
007
Capital 1,000,
000
1,000,
000
2/1/2 Vehicl 500,0 (500,0
Cash Book

48. Specimen Trial Balance

49. Specimen Profit & Loss
Account

50. Specimen Balance Sheet

51. Specimen Cash Flow
Statement

52. Key Finance Functions

53. Key Finance Functions
• Accounting
– Reporting
– Fixed Asset
– Revenue Assurance
– Accounts Payable
– Stock & Inventory
– Insurance
– Costing

54. Key Finance Functions
• Treasury
• Budgeting
• Strategic Planning
• Secretarial
• Internal & External Audit

55. Supporting the Business
• Compliance
– Accounting
– Secretarial
– External Audit
• Control
– Budgeting
– Internal Audit
• Business Decision
– Reporting
– Budgeting
– Strategic planning
– Costing

56. Supporting the Business
• Efficiency
– Stock Management
– Internal Process Audit
• Risk Management
– Treasury
– Insurance
• Corporate Governance
– Secretarial
– Shareholder Mgmt

57. Key Finance Concepts
Basic questions -
• Why we are in business?
• Why and How we measure and generate
cash and profit
• How our business actions add value?

58. Stakeholders
Business
Shareholders
Government
Employees
Customers & Consumers
Suppliers
Management
Debtholders
Community

59. Shareholder Value
&
Total Shareholder
Return
Dividend Payments
Share Price
Appreciation

60. Why we need cash & profit
Creating shareholder value
Cash & Profit
Strategic Drivers
Investment

61. In the beginning…….
Shareholders
Equity
Fixed Assets
Working
Capital
Cash in Cash out
Lenders
Debt

62. Net debt in the beginning…….
Shareholders
Equity
Fixed Assets
Net Debt
Working
Capital
Lenders
Debt
Cash in Cash out
+
-

63. Debt
• Banks
–Loan
–Trade facilities
• Bond/Debenture
Source of Cash (Fund)
Equity
• IPO
• Right share

64. Profit is a concept
Cash is reality

65. Accruals
(sale on credit)
2
1
Debtor
Income
increasing
profit
Cash
inflow

66. Depreciation
0 2
1
Fixed Asset
Expenditure
reducing
profit
Cash
outflow

67. Cash Flow
Statement
Profit & Loss
Account
A Reporting Dashboard
Operating
Profit
Operating
Cash Flow

68. Financial Statements
– The Essential Links

69. +
+
=
Net fixed assets
Working capital
Net debt
Shareholders
funds
Debtors
Stocks
- Trade creditors
Profit & loss account
Share capital
- Cash
Loans
Balance Sheet

70. Working Capital Cycle
Raw
Materials
Creditor
Finished
Goods
Debtor
Cash
Cash
from Profit
START

71. Document Links
+
=
Net debt
Shareholders
funds
Net Assets
+
=
Net debt
Shareholders
funds
Net Assets
Opening
Balance
Sheet
Closing
Balance
Sheet
Profit &
Loss
Account
Cash
Flow
Statement

72. Profit and Loss Account
Net
Turnover
Government
Levies
Variable
Costs
Gross
Margin
Gross
Turnover

73. Profit and Loss Account
Brand
Expenditure
Non-branded
Expenditure
Operating
Profit
Other Overheads
Market
Contribution
Brand Margin
Gross Margin

74. Measuring Performance
- Financial Terms and Ratios

75. Benchmarks
• Previous performance
• Targeted performance
• Other end markets
• Competitors

76. A Diagnostic Approach
Reporting Dashboard
Value Drivers
Ratio Analysis

77. RONA
Operating profit Net Trading Assets
Operating profit
Net Trading Assets
X100%
Balance Sheet
Profit & Loss
Account

78. Interpretation
RONA
Asset Turnover
Operating Margin X

79. Operating Margin
Operating profit Net Turnover
Operating profit
Net Turnover
X100%
Profit & Loss
Account
Profit & Loss
Account

80. Asset Turnover
Net Turnover Net Trading Assets
Net Turnover
Net Trading Assets
Times
Balance Sheet
Profit & Loss
Account

81. Interpretation
RONA
Asset Turnover
Operating Margin X
Debtors Days
Stock Turnover

82. Improving Performance
&
Strong Operating
Cash Flow
Sustainable
Operating profit
Growth
Effective Net
Trading Asset
Management

83. Debt to Equity
Net Debt Shareholders Funds
Net Debt
Shareholders Funds
Balance Sheet
Balance Sheet
X100%

84. The strategic drivers generate
cash &profit
Creating shareholder value
Cash & Profit
Strategic Drivers
Generation
Investment

85. Brand Profitability and the
Break Even Concept

86. Brand Profitability and the
Break Even Concept
• What is the profitability of our
brands?
• What extra volume of sales do we
have to generate to recover the
cost of a brand marketing
campaign ?
• How safe are our Operating profits?
Brand Profitability Statements
Break-even analysis
Break-even analysis

87. Brand Profitability Statements
A B Total
Gross Turnover
Government Levies
Net Turnover
Variable Costs
Gross Margin
Brand Expenditure
Brand Margin
Non-branded Expenditure
Market Contribution
Overheads
Trading Profit
Loss
Making
Brand ?

88. Behaviour of Costs
Total
Gross Turnover
Government Levies
Net Turnover
Variable Costs
Gross Margin
Brand Expenditure
Brand Margin
Non-branded Expenditure
Market Contribution
Overheads
Trading Profit
items which
do not vary
with volume
items which
vary with
volume

89. A Break Even Decision
Volume
millions
$ Per
mille
A
$m
Gross Turnover
Government
Levies
Net Turnover
Variable Costs
Gross Margin
Brand
Expenditure
Brand Margin
+2
0
+2
167 12
To recover an extra $2m brand spend the company
needs to sell an extra 167 million at a margin of $12
per mille.
(167,000,000 x $12/1000 = $2,000,000)
Break-Even

90. A Break Even Business
Volume
Millions
Av $
per
mille
Total
$m
Gross Turnover
Government Levies
Net Turnover
Variable Costs
Gross Margin
Brand Expenditure
Brand Margin
Non-branded Expenditure
Market Contribution
Overheads
Trading Profit 0
17
17
10
27
15
42
8
5250
Break-Even

91. Margin of Safety
Break Even
Safety Margin
Volume
millions
%
Break-Even 5250 67
Margin of Safety 2596 33
Current Sales 7846 100

92. Project Valuation

93. Valuation to Aid Decisions
Financial considerations are part of any
decision making process
•Acquiring a new business
•Building a new factory
•Buying new machinery
•Launching a new brand
•Changing the level of brand support
• Starting a price war

94. Problem
0 3
2
1
Time
In
Out
• Cash outflow now - initial outlay
generates
• Cash inflows in the future

95. Cash received tomorrow is worth less
than cash received today
The Time Value of Money

96. Examples of Time Value of Money
• A. Which would you choose. $100 today or
$100 guaranteed in a year’s time?, why?
• B. Which would you choose. $100 today
invested at 5% p.a. or $110 guaranteed in a
year’s time?
• C. What would we need to offer you in a
year’s time for you to be indifferent between
that and the opportunity to invest $100 today
at 5%?
$100 today - time value of money
$110 tomorrow - in a year’s time $100 is worth $105
$105 tomorrow

97. The value in today’s terms of cash
received in the future
Present Values
Calculated by discounting cash received
in the future

98. Present Values Examples
(using 5% discount rate)
• What is the present value of $2m
receivable in one year’s time?
• What is the present value of $2m
receivable in two year’s time?
• What is the present value of $2m
receivable after one year and again
after 2 years
e.g.
1
e.g.
2
e.g.
3

99. Present Values
• Present Value
= 2 x 1/1.05
= 1.905
• To check
1.905 x 1.05
= 2
0 1
PV of
$2.0m
=
$1.905m
$2.0m
x 1/1.05
x 1.05
Discount
Factor
e.g.
1

100. Present Values
Present Value
= 2 x 1/1.05 x 1/1.05
=1.814
0 1
PV of
$2.0m
=
$1.814m
x 1/(1.05)
2
$2.0m
x 1/(1.05)
e.g.
2

101. Present Values
Present Value
= (2 x 1/1.05) +
(2 x 1/1.05 x
1/1.05)
= 3.719
0 1
PV
=
$3.719m
x 1/(1.05)
2
$2.0m
x 1/(1.05)
$2.0m
x 1/(1.05)
e.g.
3

102. Net Present Values Examples
(using discount rate of 5%)
• What is the net present value of $2m
receivable in one year’s time from an
investment of $1.9m?
• What is the net present value of $2m
receivable in two year’s time from an
investment of $1.9m?
e.g.
4
e.g.
5

103. Net Present Values
0 1
PV of
$2.0m
=
$1.905m
$2.0m
In
Out
NPV
$0.005
m
Positive, so invest
e.g.
4
$1.9m

104. Net Present Values
0 1
PV of
$2.0m
=
$1.814m
x 1/(1.05)
2
$2.0m
x 1/(1.05)
$1.9m
In
Out
NPV
$0.186
m Negative, don’t invest
e.g.
5

105. Long Term Decision Making
Problems
• Allocating limited resources
between competing projects
• Choosing an appropriate risk
adjusted discount rate
• Estimating future cash flows
accurately

106. Costing

107. Product Costing
• Material costs
• Manufacturing costs
• Component costs
• Storage costs

108. Product Costing
Methods
• Activity Based
• Flashback
• Standard Cost etc.
Purpose
• Variance analysis
• Wastage Management
• Cost Management
• Pricing decisions

109. Budgeting, Planning &
Reporting

110. Budget Definition
• Budgeting is the process for establishing a planned level
of Revenue, Expenditures & Investments of a Business
usually at a fairly detailed level.

111. Purpose of Budgeting
• Budgeting has many utilities
– Expenditure control, Managers may use budgets to
ensure control of expenditure
– Investors, Shareholders, Lenders, etc may use
performance against budgets as an indication of
business health
– Departments, Individuals & the Overall Organization
may use budget variance information for monitoring
– As a planning tool and aid

112. Budget Timing
Budgeting may be practiced at specific time
intervals or for specific needs
– The Annual Budget or Master budget
– The Intermediate Forecasts
– The Strategic Plan or Business Plan

113. Budget Timeline & Objective
•Annual Budget : To set goal for next year based on
current year’s performance
•Forecast : To accommodate the environmental changes
which effect current year’s budget and to set a more
realistic Target

114. Typical Budgeting Process
• Budget department sends standard template to all
departments to collect requirements
• Commercial Forecast (Sales & Revenue) is the first one
to complete
• Based on the commercial numbers, all departments
prepare their CAPEX & OPEX forecast and HC planning
• All the departmental forecasts usually need to be
discussed and approved by the concerned department
Head and Finance Head

115. Typical Budgeting Process
• The budgeting team collects the forecasts and
consolidates them
• After consolidation the budgeted P & L, Balance Sheet &
Financing Plans are prepared
• After local management approval, the forecast is sent to
Holding company or presented to Board
• After the Board Meeting or Business Review Meeting,
the budget is finalized and rolled out to departments
• Forecasts are submitted to Top Management for
approval as well

116. Budgeting Process
HC Plan
OPEX Plan
CAPEX Plan
Revenue
Plan
Consolidation
of the
Forecast
Financing
Plan
Preparation
Balance
Sheet
Preparation
Income
Statement
Preparation
Business
Review
Meeting
Presentation
Final Plan roll-out
Local
Management
Review
If agreed Approved
Commercial
Plan
Technical
Plan
IT Plan
Admin Dept
Plan
All Other
Departments
If not aprooved

117. Budget Consolidation – Holding level
• After Budget submission from all the subsidiaries, Holding
companie’s Budget team compiles all the forecast to
prepare the Group Budget which ultimately ends by
merging into the Group’s Budget
• Deadlines are important because, if any of the
subsidiaries fails to meet the process, the whole budget
process for Group risks delaying.
• The compiled budget is circulated to many stakeholders :
The Shareholders, Lenders, Potential investors, Banks
etc. If any subsidiary fails to meet its target, that ultimately
may result in non target achievement of the whole group.

118. Budget Follow-Up
• Once the budget/forecast is rolled out, the actual
performance of the subsidiary is measured against it.
The follow up process are as follows:
– Before the expense occurs: Budget dept checks the amount
in the PO against allocated budget
– At the end of each month, all departments receive an
analysis of the department’s Revenue & Expense compared
to the Budget/Forecast from Budget dept.
– Finally, in the monthly review, all the subsidiaries have to
face Regional team or Group to analyze the actual
performance for the month. The CEO, CFO, CTO, Head of
commercial and Budget team attends the meeting.

119. Budget Follow-Up
Enter Reporting Currency US $ March 2007 Year to Date
A Vs. B % A Vs. F % A Vs. B % A Vs. F %
Postpaid Revenue :
Postpaid connection fee 206.1 98.2 0.0 107.9 109.9% 0.0 468.6 328.1 0.0 140.5 42.8% 0.0
Postpaid outgoing (National/Int'l) 3,210.2 7,047.7 0.0 (3,837.4) -54.4% 0.0 9,208.6 20,183.3 0.0 (10,974.7) -54.4% 0.0
Postpaid incoming 115.7 204.5 0.0 (88.8) -43.4% 0.0 277.7 549.4 0.0 (271.7) -49.5% 0.0
Monthly Postpaid fee 61.7 107.3 0.0 (45.6) -42.5% 0.0 (393.2) 300.0 0.0 (693.2) -231.1% 0.0
Subscriber Roaming - Postpaid 10.7 5.6 0.0 5.1 91.3% 0.0 24.1 15.9 0.0 8.1 51.0% 0.0
Postpaid VAS Revenue 20.7 40.4 0.0 (19.8) -48.9% 0.0 54.0 112.3 0.0 (58.3) -51.9% 0.0
Other Postpaid Revenue 1.4 3.4 0.0 (2.0) -57.9% 0.0 3.7 9.6 0.0 (5.9) -61.4% 0.0
Total Postpaid Revenue 3,625.1 7,503.7 0.0 (3,878.6) -51.7% 0.0 9,639.7 21,489.0 0.0 (11,849.3) -55.1% 0.0
Prepaid Revenue :
Prepaid connection fee 1,143.5 276.1 0.0 867.4 314.1% 0.0 1,789.2 788.9 0.0 1,000.3 126.8% 0.0
Prepaid outgoing (National/Int'l) 6,176.1 6,794.6 0.0 (618.4) -9.1% 0.0 15,426.1 17,740.9 0.0 (2,314.8) -13.0% 0.0
Prepaid incoming 893.5 1,550.4 0.0 (656.9) -42.4% 0.0 2,393.1 4,095.9 0.0 (1,702.8) -41.6% 0.0
Scratch Cards Admin Fee 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Subscriber Roaming - Prepaid 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Prepaid VAS Revenue 276.6 352.1 0.0 (75.5) -21.4% 0.0 763.3 973.3 0.0 (210.0) -21.6% 0.0
Other Prepaid Revenue 184.6 3.6 0.0 180.9 4974.9% 0.0 350.3 9.7 0.0 340.6 3508.0% 0.0
Total Prepaid Revenue 8,489.8 8,973.2 0.0 (483.4) -5.4% 0.0 20,371.7 23,599.1 0.0 (3,227.4) -13.7% 0.0
Other Revenue :
Visitors Roaming 33.6 43.0 0.0 (9.4) -21.9% 0.0 109.3 120.0 0.0 (10.7) -8.9% 0.0
Handsets / Spare parts sales 0.0 42.7 0.0 (42.7) -100.0% 0.0 21.6 122.5 0.0 (100.9) -82.3% 0.0
Miscellaneous Revenue 28.4 419.2 0.0 (390.8) -93.2% 0.0 82.4 1,239.2 0.0 (1,156.8) -93.4% 0.0
Total Other Revenue 61.9 504.9 0.0 (443.0) -87.7% 0.0 213.3 1,481.7 0.0 (1,268.4) -85.6% 0.0
Total Revenue 12,176.8 16,981.9 0.0 (4,805.0) -28.3% 0.0 30,224.7 46,569.8 0.0 (16,345.1) -35.1% 0.0
Cost of Sales
Dealer Commission 1,692.0 2,165.5 0.0 (473.5) -21.9% 0.0 2,810.8 6,148.6 0.0 (3,337.8) -54.3% 0.0
Interconnect costs - PTT 401.0 186.8 0.0 214.3 114.7% 0.0 1,040.1 506.0 0.0 534.0 105.5% 0.0
Interconnect costs - GSM's 2,932.2 3,918.6 0.0 (986.4) -25.2% 0.0 7,381.4 10,945.9 0.0 (3,564.5) -32.6% 0.0
Interconnect costs - Roaming 18.8 20.9 0.0 (2.1) -10.2% 0.0 79.3 58.7 0.0 20.6 35.1% 0.0
Revenue Sharing 382.7 666.7 0.0 (284.0) -42.6% 0.0 1,049.1 1,807.6 0.0 (758.6) -42.0% 0.0
SIM Cards costs 899.3 543.2 0.0 356.1 65.6% 0.0 1,470.2 1,555.2 0.0 (85.0) -5.5% 0.0
Scratch Cards cost 171.7 160.2 0.0 11.5 7.2% 0.0 548.0 472.9 0.0 75.1 15.9% 0.0
Handsets / Spare parts Cost 0.0 142.4 0.0 (142.4) -100.0% 0.0 21.6 408.4 0.0 (386.8) -94.7% 0.0
Other Cost of sales items 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total Cost of Sales 6,497.7 7,804.3 0.0 (1,306.6) -16.7% 0.0 14,400.5 21,903.3 0.0 (7,502.8) -34.3% 0.0
Gross Margin 5,679.1 9,177.6 0.0 (3,498.5) -38.1% 0.0 15,824.2 24,666.5 0.0 (8,842.3) -35.8% 0.0
Gross Margin % 46.6% 54.0% #DIV/0! -7.4% -13.7% 0.0% #DIV/0! 52.4% 53.0% #DIV/0! -0.6% -1.2% 0.0% #DIV/0!
Variance
Financials ( '000 ) Actual Budget Forecast
Forecast
Budget
Actual
Variance

120. Strategic Plan
Strategic Planning Cycle Process
Holding
IT
&
HR
Finance
Commercial
Technical
Time
Line
Management
Group Corporate
Goals
B
U
S
I
N
E
S
S
U
N
I
T
Business
Unit
Target
Communicates
Finance Planning
Commercial
Planning
Technical
Planning
IT & HR planning
Strategic
Plan
Strategic Planning
cycle Unit
H
O
L
D
I
N
G Coordinates
Matching Business
Unit & Corporate
Planning Targets
Sends to
management for
approval
Accepts?
CEO sends the
finalized SP in BP
template and sends
along with the SP
presentations
Discuss
disagreement
No
Accepts
Discusses
disagreement
No
Strategic
Plan
Finalized
Yes
Monitoring/
Evaluation
Strategy
Impleme
ntation
Sends to
Commercial for
review
Business review
Adjusts as per
Commercial review
Adjusts as per
Commercial review
Sends to Technical,
IT & HR to adjust
accordingly
Matching with the
adjustment & sends
for approval
Accepts?
Discuss
disagreement
Sends for Holding
approval
Accepts?
Strategic Plan
Reviewed
No
End of April
Yes
Middle of
June
Strategic Plan Formation
Middle of
October
End of
November
Strategic Plan Review
CEO sends the
finalized SP in BP
template and sends
along with the SP
presentations

121. Presentation Contents
• Slide- 1 : Company Name & Vision/ Mission
• Slide- 2 : Introduction of the Management team
• Slide – 3: Your key proposition – How much fund you
want to raise from the new shareholder and Bank
• Slide – 4 : Business Performance – Past & Projected
( including Revenue, Direct cost and Operating Cost
Growth, Proposed Dividend per share )
• Slide – 5-7 : P&L, Cash Flow and Balance Sheet

122. Presentation Contents
• Slide- 1 : Company Name & Vision/ Mission
• Slide- 2 : Introduction of the Management team
• Slide – 3: Your key proposition – How much fund you
want to raise from the new shareholder and Bank
• Slide – 4 : Business Performance – Past & Projected
( including Revenue, Direct cost and Operating Cost
Growth, Proposed Dividend per share )
• Slide – 5-7 : P&L, Cash Flow and Balance Sheet

123. Thank You