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1. Brihan Maharashtra College of Commerce,
Pune.
M. Com. Part II – Semester IV(2018-19)
A
SYNOPSIS ON
On the topic
“FINANCIAL STATEMENT ANALYSIS AND
INTERPRETATION”
In the partial fulfillment of the requirement for qualifying
MASTER OF COMMERCE
UNDER THE SUPERVISION OF:
M.K.Gavaskar sir
SUBMITTED BY
SURVE SAURABH SURESH
Roll no -252

2. 1.TITLE OF THE PROJECT
FINANCIAL STATEMENT ANALYSIS AND INTERPRETATION
2.INTRODUCTION-
Financial statements are formal record of the financial activities of a business, person
or other entity and provide an overview of a business or person’s financial condition in both
short and long term. They give an accurate picture of a company’s condition and operating
results in a condensed form. Financial statements are used as a management tool primarily by
company executive and investor’s in assessing the overall position and operating results of
the company. Analysis and Interpretation of financial statements help in determining the
liquidity position long term solvency, financial viability and profitability of a firm. Ratio
analysis shows whether the company is improving or deteriorating in past years. Moreover,
comparison of different aspects of all the firms can be done effectively with this. It helps the
clients to decide in which firm the risk is less or in which one they should invest so that
maximum benefit can be earned. Industries are capital intensive; hence a lot of money is
invested in it. So before investing in companies one has to carefully study its financial
condition and worthiness. An attempt has been carried out in this project to analyze and
interpret the financial statements of a company.
3,NEED OF RESEARCH-
After globalisation, the business has shown a steep rise which has also attracted many
investors to invest in this sector. Thus to make a correct investment decision the investor
must be well versed with the company’s financial positioning, ability to pay back, ability to
meet the short term and long term obligation. The study will help to analyze the short term
financial performance of the company with the help of liquidity ratios. The study will also
give an indication of financial position which will help the investors to take a correct decision
on investment. Through the liquidity ratio the potential investors, creditors and lenders will
come to know the ability of a concern to meet its current obligations when these become due.
Working capital ratio is most widely used to make the analysis of short-term financial
position or liquidity, will enable the management to take decision regarding the short term
financial plans.
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3. 4.RESEARCH OBJECTIVE-
 Know the Financial Position: The basic objective of studying the
financial statements of the company is to know the financial position
of the company.
 To understand, analyse and interpret the basic concepts of financial statements of
different mining companies.
 To make comparative study of financial statements of different years.
 To bring out the results of financial statements through ratio analysis.
 To draw the correct picture of the financial operations of the company in terms of
liquidity, solvency, turnover, profitability etc.
 Use of Tally 9.0 package for the analysis and interpretation of financial statements of
mining companies
5.SCOPE OF THE RESEARCH
The financial statement is the depiction of companies’ growth and establishing its
available resources. . The statements are prepared for a particular period. The financial
statements by nature are summaries of items recorded in the business and these statements are
prepared periodically. They are prepared for the purpose of presenting a periodical review of
reports on progress by the management and deal with the status of investment in the business
and the results achieved during the period under review.
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4. 6.RESEARCH METHODOLOGY-
Research methodology in a way is a written game plan for conducting research.
Research methodology has many dimensions. It includes not only the research methods but
also considers the logic behind the methods used in the context of the study and complains
why only a particular method of technique has been used. Descriptive research procedure was
used for describing the recent situations in the organization and analytical research to analyze
the results by using research tools.
Data source & Collection Methods:
I. Secondary Data:
Secondary Data are those which have already been collected by someone else and
which have already been passed through the statistical process. [Secondary data will be
collected from the reports of the company, books, journals and internet. It is gathered from
annual reports, official records and standing orders of the units
Here will be done the analysis on basis of secondary data, which include:
 Balance Sheet of company
 Profit and loss A/C of the Company.
a).Tools used:
I will use the different tools to analyze the ratio of Dabur India Limited:–
 Analysis through Working capital ratios.
 Current ratio
 Quick ratio
 Absolute liquid ratio
 Total assets turnover ratio
 Debt equity ratio
 Working Capital Turnover Ratio etc.
b).STASTICAL TOOLS:-
MS-EXCEL will use to prepare pie- charts and graphs and MS-WORD will use to prepare
or write the whole project report.
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5. 7.LIMITATION;-
Even though every effort will be taken to minimize the variation and present a factual
picture with the help of statistical methods, but still there are some limitations, which are as
follows:
 The preparation and interpretation of data may not be 100% free from
errors and may be affected from the annual report of the company.
 The study will be based on the balance sheet and profit and loss a/c of
the company and depends directly on balance sheet and annual reports
of the company.
 Limitations of the time and resources may be narrow the scope of
study.
8. CHAPTERISATION
1.Executive Summary
2.Introduction
3. Objectives & Scope of the project
4. Company Profile
5. Product Profile
6. Theoretical Background
7. Research Methodology
8. Data Analysis & Interpretation
9..Finding
10. Limitations of the Project
11. Conclusion & Suggestions
12. Bibliography “
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