1. Internship Report (12MBA47) on
A STUDY ON COST CONTROL ANALYSIS IN NARAYANA
HEALTH CARE, BANGALORE.
Submitted by
Mr. NARENDRA KUMAR B
USN: 1TJ12MBA24
M.B.A (FINANCE)
Submitted to
VISVESVARAYA TECHNOLOGICAL UNIVERSITY, BELGAUM
In partial fulfillment of the requirements for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
Under the guidance of
INTERNAL GUIDE EXTERNAL GUIDE
Mr. N. SATHYANARAYANA
Assistant Professor
T. John Institute of Technology
Bangalore-83
Ms. RAMYA .K .S
Finance Manager
Narayana Health Care,
Bangalore-99
DEPARTMENT OF MASTER OF BUSINESS ADMINISTRATION
T. JOHN INSTITUTE OF TECHNOLOGY
BANGALORE-560083
BATCH: 2012-14

2. DECLARATION
I, Mr. NARENDRA KUMAR B, bearing USN: 1TJ12MBA24 hereby declare that the
Internship report (12MBA47) entitled “A STUDY ON COST CONTROL ANALYSIS
AT NARAYANA HEALTH CARE, BANGALORE” prepared by me under the
guidance of Mr. N. SATHYANARAYANA, Assistant Professor of M.B.A Department,
T. John Institute of Technology and external assistance by Ms. RAMYA K S, Finance
Manager, Narayana Health Care.
I also declare that this Internship work is towards the partial fulfillment of the university
regulations for the award of degree of Master of Business Administration by Visvesvaraya
Technological University, Belgaum.
I have undergone a summer project for a period of Twelve weeks. I further declare that
this project is based on the original study undertaken by me and has not been submitted
for the award of any degree/diploma from any other University/Institution.
Place: Bangalore
Date:
Mr. NARENDRA KUMAR B
USN: 1TJ12MBA24

3. ACKNOWLEDGEMENT
The Successful accomplishment of any task is incomplete without acknowledging
the contributing personalities who assisted, inspired & lead us to visualize the things that
turn them into successful stories for our successors. So it is great pleasure to acknowledge
with thanks, my respectful and bellowed ones for helping me to bring out this Internship
report successfully.
First and foremost I would like to thank with immense gratitude
Dr. S. PADMANABHA, the Principal of T-John Institute of Technology.
Ms. ROOPA RANI V, the Assistant Professor& Head of the Department of MBA, T.
John Institute of Technology, Bangalore, for giving the opportunity of being the part of
this institution and for bighearted help to the internship.
I express my heart full thanks to my Internal Guide, Mr. N. SATHYANARAYANA
the Assistant Professor, Department of MBA, T. John Institute of Technology, Bangalore
for being the brightest, continuous help and encouragement to the success of the
Internship Report, helped me in each stage, the best way to making the concepts and
recent implications in the present industry scenario.
I express my profound gratitude to my External Guide Ms. RAMYA K S, Finance
Manager, Narayana Health Care, Bangalore for helping to avail the opportunity to
carry out this internship. Her constant guidance during my stay in the company was great
help to me. I would also like to thank the department heads for extending their undivided
support and co-operation.
Finally it is foremost duty to thank all my family members and friends who helped
me to complete my project work without which this project would have not been
successful.
Mr. NARENDRA KUMAR B
USN: 1TJ12MBA24

4. TABLE OF CONTENTS
Chapter No Particulars Page No
EXECUTIVE SUMMARY
CHAPTER-1 INTRODUCTION 1-6
1.1 Introduction About The Internship 1
1.2 Statement of The Problem 1-2
1.3 Need For The Study 2
1.4 Objectives of The Study 2
1.5 Scope of The Study 2
1.6 Research Methodology 2-3
1.7 Hypothesizes 3-4
1.8 Literature Review 4-6
1.9 Limitations of The Study 6
CHAPTER-2 INDUSTRY PROFILE AND COMPANY
PROFILE
2.1 INDUSTRY PROFILE 7-17
2.1.1 Introduction to Indian service sector 7-8
2.1.2 Health care sector In India 8-9
2.1.3 Health care sector and economic development 9-10
2.1.4 Five years plans related to health care 11-12
2.1.5
2.1.6
Present scenario of health care In India
Different health care systems In India
12-15
15-17
2.2 COMPANY PROFILE 18-32
2.2.1 History 18-19
2.2.2 Milestones 19-20
2.2.3 Achievements 20
2.2.4 Awards & accolades 21
2.2.5 Promoters / Ownership pattern 22
2.2.6
2.2.7
Vision, Mission & Core values
Areas of operations
22
23

5. 2.2.8 Services profile 23-24
2.2.9 Infrastructural Facilities 24
2.2.10 Competitors information 25-26
2.2.11 SWOT Analysis 26-28
2.2.12 Future Growth & Prospects 28
2.2.13 Analysis of Financial Statement 29-32
CHAPTER-3 BACKGROUND OF THE STUDY 33-42
3.1 Introduction 33
3.2 Elements of costs 33-34
3.3 The planning process 34
3.4 Importance of cost control 35
3.5 Cost controlling process 35-36
3.6 Cost controlling drivers 36-37
3.7 Conceptual definitions of the overheads used in
the study
37-42
3.8 Conceptual Definitions of Statistical Tools Used
in The Study
42
CHAPTER-4 DATA ANALYSIS AND INTERPRETATION 43-62
CHAPTER-5 SUMMARY OF FINDINGS, SUGGESTIONS
AND CONCLUSION
63-66
5.1 Findings 63-64
5.2 Suggestions 65
5.3 Conclusion 66
BIBLIOGRAPHY

6. LIST OF TABLES
Table
No
Title Page No
2.1 Table showing Growth drivers for Indian health care 12
2.2 Table showing Trends in public health expenditure in India 14
2.3 Table showing Balance Sheet 29-30
2.4 Table showing Profit & Loss Account 31
4.1 Table showing The material cost percentage 43
4.2 Table showing Finished goods percentage 44
4.3 Table showing Operating expenses percentage 45
4.4 Table showing Administrative expenses percentage 46
4.5 Table showing Selling and delivery of services expenses
percentage
47
4.6 Table showing Operating expenses percentage on cost of
sales and services
48
4.7 Table showing Administrative expenses percentage on cost
of sales and services
49
4.8 Table showing Selling and delivery of services expenses
percentage on cost of sales and services
50
4.9 Table showing Material cost percentage on Operating
expenses
51
4.10 Table showing prime cost percentage on Operating expenses 52
4.11 Table showing Administrative expenses percentage on work
cost
53
4.12 Table showing Administrative expenses percentage on cost
of sales and services
54
4.13 Table showing Administrative expenses percentage on
conversion cost
55
4.14 Table showing Selling and delivery of services expenses
percentage on cost of sales and services
56

7. 4.15 Table showing Selling and delivery of services expenses
percentage on work cost
57
4.16 Table showing cost of materials and profits 58
4.17 Table showing Correlations Between cost of materials and
profits
58
4.18 Table showing finished goods and profits 59
4.19 Table showing Correlations Between finished goods and
profits
59
4.20 Table showing operating expenses and profits 60
4.21 Table showing Correlations Between operating expenses
and profits
60
4.22 Table showing administrative expenses and profits 61
4.23 Table showing Correlations Between administrative
expenses and profits
61
4.24 Table showing selling and delivery of services expenses and
profits
62
4.25 Table showing Correlations Between selling and delivery of
services expenses and profits
62

8. LIST OF GRAPHS
Graph
No
Title Page
No
4.1 Graph showing Material cost percentage 43
4.2 Graph showing Finished goods percentage 44
4.3 Graph showing Operating expenses percentage 45
4.4 Graph showing Administrative expenses percentage 46
4.5 Graph showing Selling and delivery of service expenses percentage 47
4.6 Graph showing Operating expenses percentage on cost of sales and
services
48
4.7 Graph showing Administrative expenses percentage on cost of sales
and services
49
4.8 Graph showing Selling and delivery of service expenses percentage on
cost of sales and services
50
4.9 Graph showing Material cost percentage on operating expenses 51
4.10 Graph showing Prime cost percentage on operating expenses 52
4.11 Graph showing Administrative expenses percentage on work cost 53
4.12 Graph showing Administrative expenses percentage on cost of sales
and services
54
4.13 Graph showing Administrative expenses percentage on conversion
cost
55
4.14 Graph showing Selling and delivery of service expenses percentage on
cost of sales and services
56
4.15 Graph showing Selling and delivery of service expenses percentage on
work cost
57

9. EXECUTIVE SUMMARY
Indian service sector has witnessed a major boom and is one of the major
contributors to both employment and national income in recent times. The activities under
the purview of the service sector are quite diverse. Trading, transportation and
communication, financial, real estate and business services, community, social and
personal services come within the gambit of the service industry. One of the key service
industries in India would be health and education. They are vital for the country„s
economic stability. A robust healthcare system helps to create a strong and diligent human
capital, who in turn can contribute productively to the nation„s growth.
The Bangalore cardiac unit of Narayana Health Care (previously Narayana
Hrudayalaya now Narayana Institute of Cardiac Sciences) is one of the world's largest
heart hospitals. It is the brainchild of a cardiac surgeon, Dr. Devi Prasad Shetty. World's
most economical healthcare service providers is set to emerge as a global industry model
for its ability to reconcile quality, affordability, scale, transparency, credibility and
sustainable profitability. It may be noted that the affluent come here for the world's best
healthcare and the poor come here for the focused attention they can get from a private
hospital. The group has already established its presence in Bangalore, Kolkata,
Ahmedabad, Hyderabad, Jaipur, Raipur, Jamshedpur, Guwahati, Mysore, Dharwad,
Kolar, Shimoga and Davangere.
The title of the project is “A STUDY ON COST CONTROL ANALYSIS IN
NARAYANA HEALTH CARE, BANGALORE” helps to know the profitability position
of the Narayana Health Care. The purpose of the project is improving financial efficiency
in day to day operations in order to improve the services and effectiveness of the
Narayana Health Care by controlling cost.
The research design used is descriptive research. The main source of data
collection for this project is Secondary source. Secondary data is collected by referring
annual reports, cost reports and company web sites. It also used to the Profitability and
Financial Position of Narayana Health Care. This is also helped to identify the

10. correlation between expenditures & profitability and also to know the efficient utilization
of the available funds through proper cost controlling techniques.
The study has been carried out with the help of company reports to determine the
processed, tabulated and analysed using overheads are represented with appropriated
graphs, MS office 2010, to test hypothesis correlation were applied with the help of
SPSS.21 software package.
The material cost has increased during the study period. It is suggested to the
management to initiate the concerned department heads to send material requirements
early to the purchase department to make consolidated purchase budgets to reduce cost
and time in materials purchases. The percentage of finished goods on cost of sales and
services has increased heavily because the Narayana Health Care providing high quality
services at an affordable price. The operating expense has increased because of huge
expenses on operations & services. The administrative expenses was increased because
the company spending huge cost to its administrative departments. The advertisement and
business promotion expenses were increased because there is proper up gradation in the
marketing strategies. There is low positive correlation between cost of materials
consumed and profits of Narayana Health Care. There is an Unfavorable or critical
economic condition of the Narayana Health Care, because the company didn‟t maintain
enough cash balances.
The overall rating of the Narayana Health Care is satisfactory in terms of the
financial position and tools & techniques used by the Narayana Health Care. The
management should take a serious action to maintain its existing operations and services
to improve latest techniques to retain them in the organization and increase profitability
position of the Narayana Health Care based on their quality of services.

11. BIBLIOGRAPHY
BOOKS:
1. Lall Nigam B.M and Jain I.C, “Cost Accounting” Asoke k. Ghosh publishers,
page no.88, 89, 90 & 171, 172.
2. Jain S.B and Narang K.L “Cost Accounting” seventh revised edition, Kalyani
publishers, 2002, page no. I-24 to I-26, II-6 to II-8.
3. C.R.Kothari, “Research Methodology” second revised edition, New age
international publishers.
4. S.C.Gupta, “Fundamentals of Statistics” seventh revised & enlarged edition,
Himalaya publishing house.
5. A.K. Sharma (2005) “Business Statistics” First published, Discovery Publishing
House.
6. M.N. Arora (2008) “Cost and management accounting” Third Edition,
Himalaya Publishing House.
7. Dr. Sreenivas D.L & Dr. J. Gajendra Naidu, “Cost Management” Thakur
publishers.
ARTICLES/JOURNALS
1. Barbole A.N., Yuvraj D. Nalwade and Santosh D. Parakh (2013) “Impact of Cost
Control and analysis techniques on Manufacturing Sector in Dspace”, Indian
Streams Research Journal, Volume-3, Issue-5, pp. 1-8.
2. Jyoti G. Borade and Vikas R. Khalkar (2013) A study on Software Project Effort
and Cost Estimation Techniques in GIT, Maharashtra. Volume-3, Issue-8, pp.730-
739.
3. Sagar K. Bhosekar and Gayatri Vyas (2012) A study on Cost Controlling Using
Earned Value Analysis in Construction Industries in IJEIT. Volume 1, Issue-4, pp.
324-332. Cardiac

12. 4. Stella Zounta1 and Michail G. Bekiaris (2009) A study on Cost-based
Management and Decision Making in Greek Luxury Hotels, Volume 4, Number 3,
pp. 205-225.
5. Hui Li (2009) A Study on Construction Cost control of Construction Projects in
Asian social science, Volume-5 Number-8, pp.144-149.
WEBSITES
 www.narayana health care.com
 www.narayana hrudayalaya.com
 www.narayana cardiac research.com
 www.narayana health group.com
 www.wikipedia.com
 www.ehow.com
 www.service sectors.com
 www.indian health care industry.com
 www.google.com
REPORTS
Annual Reports of Narayana Health Care, Bangalore (2008-09 to 2012-13)