Weber’s theory of location of industry,the various sources of finance to industrial units,Optimum size of units,Micro, small and medium enterprises,NEDFi,the distinctive features of modern approach to financial management,The various bases for determining the proportions (weights) to be employed in calculating the weighted average cost of capital, application of management accounting techniques for managerial decisions,the need for cost control,the use of control techniques in better cost management,the evolution and present status of direct taxes as provided in the Indian constitution,the provisions of the Income Tax Act with regard to tax deducted at source.
Entrepreneurship development - Micro Small and Medium EnterprisesSOMASUNDARAM T
Meaning; Definition; Types; product range; capital investment; ownership patterns; Importance and role played in the development of the Indian economy; Problems and Remedies; Sickness in MSME’s; Meaning and definition of a sick industry; Causes of industrial sickness; Preventive and remedial measures for sick industries.
Entrepreneurship development - Institutional AssistanceSOMASUNDARAM T
The document discusses various types of institutional assistance available to small scale industries in India. It describes the financial assistance provided by State Finance Corporations (SFCs), Small Industries Development Bank of India (SIDBI), commercial banks, Karnataka State Industrial Investment and Development Corporation (KSIIDC), Karnataka State Small Industries Development Corporation (KSSIDC), and Industrial Finance Corporation of India (IFCI). It also outlines various loan schemes and eligibility criteria for small scale entrepreneurs to receive funding from these institutions.
finance and institutional support for entreprenurshipSameer Chandrakar
This document discusses various aspects of financing an enterprise, including financial planning, estimating capital needs, classifying financial needs, and identifying sources of finance. It covers the importance of financial planning, factors to consider in estimating money needed, ways to classify financial needs based on use and permanence, and internal and external sources of finance. Institutional support for entrepreneurs from organizations like NSIC, SIDO, SSIB, and industrial estates is also summarized. The document provides an overview of financing considerations and support structures for new enterprises.
This document discusses small scale industries (SSIs) in India. It begins by defining SSIs and listing their key characteristics, which include small capital investment, family ownership, poor management, and high risk of closure. It then outlines the need for SSIs in terms of employment creation, income generation, and catering to individual tastes. The objectives, scope and industries reserved for the small scale sector are provided. The role of SSIs in economic development through job creation and dispersal of industries is examined. Steps to start a SSI and the various government policies to promote SSIs from 1948 to 2005 are summarized.
FINANCIAL SUPPORT FOR ENTREPRENEUR'S IN INDIARANI REENA
The document discusses various types of entrepreneurs and financial support available in India for entrepreneurs. It describes innovative entrepreneurs who create new products and take risks, imitating entrepreneurs who copy others' ideas, and drone entrepreneurs who are satisfied with the status quo. The government plays a key role in supporting entrepreneurship through various institutions that provide funding, training, and resources. Recent government schemes aim to promote young entrepreneurs through initiatives in dairy, manufacturing, and innovation. Entrepreneurship is important for economic development as it creates jobs and drives competition.
Entrepreneurship development - Venturing Small BusinessSOMASUNDARAM T
Steps involved in starting a business venture; location, clearances and permits required, formalities, licensing and registration procedures; Feasibility study (financial, technical and social) of project; Sources of Finance: Short term and Long term (Venture Capital and Angel Investing)
Small industries development bank of indiaArushi Rajput
The Small Industries Development Bank of India (SIDBI) was founded in 1990 as the principal financial institution to promote, finance, and develop micro, small and medium enterprises in India. It was established as a wholly owned subsidiary of IDBI Bank under an Act of the Indian Parliament. SIDBI provides financing support to MSMEs, which contribute significantly to the Indian economy through production, employment, and exports. In addition to direct financing, SIDBI also engages in promotion, development, and coordination activities to strengthen the MSME sector.
IDFC is a major provider of infrastructure financing in India. Over the past 5 years, it has tripled its project approvals and nearly doubled its disbursements. It offers a wide range of financial products and services including project finance, private equity, asset management, and investment banking. IDFC has grown significantly in recent years, with its net worth increasing over 2.5 times and total assets growing nearly 3 times from 2005 to 2010. It aims to further support the development of infrastructure across India.
Entrepreneurship development - Micro Small and Medium EnterprisesSOMASUNDARAM T
Meaning; Definition; Types; product range; capital investment; ownership patterns; Importance and role played in the development of the Indian economy; Problems and Remedies; Sickness in MSME’s; Meaning and definition of a sick industry; Causes of industrial sickness; Preventive and remedial measures for sick industries.
Entrepreneurship development - Institutional AssistanceSOMASUNDARAM T
The document discusses various types of institutional assistance available to small scale industries in India. It describes the financial assistance provided by State Finance Corporations (SFCs), Small Industries Development Bank of India (SIDBI), commercial banks, Karnataka State Industrial Investment and Development Corporation (KSIIDC), Karnataka State Small Industries Development Corporation (KSSIDC), and Industrial Finance Corporation of India (IFCI). It also outlines various loan schemes and eligibility criteria for small scale entrepreneurs to receive funding from these institutions.
finance and institutional support for entreprenurshipSameer Chandrakar
This document discusses various aspects of financing an enterprise, including financial planning, estimating capital needs, classifying financial needs, and identifying sources of finance. It covers the importance of financial planning, factors to consider in estimating money needed, ways to classify financial needs based on use and permanence, and internal and external sources of finance. Institutional support for entrepreneurs from organizations like NSIC, SIDO, SSIB, and industrial estates is also summarized. The document provides an overview of financing considerations and support structures for new enterprises.
This document discusses small scale industries (SSIs) in India. It begins by defining SSIs and listing their key characteristics, which include small capital investment, family ownership, poor management, and high risk of closure. It then outlines the need for SSIs in terms of employment creation, income generation, and catering to individual tastes. The objectives, scope and industries reserved for the small scale sector are provided. The role of SSIs in economic development through job creation and dispersal of industries is examined. Steps to start a SSI and the various government policies to promote SSIs from 1948 to 2005 are summarized.
FINANCIAL SUPPORT FOR ENTREPRENEUR'S IN INDIARANI REENA
The document discusses various types of entrepreneurs and financial support available in India for entrepreneurs. It describes innovative entrepreneurs who create new products and take risks, imitating entrepreneurs who copy others' ideas, and drone entrepreneurs who are satisfied with the status quo. The government plays a key role in supporting entrepreneurship through various institutions that provide funding, training, and resources. Recent government schemes aim to promote young entrepreneurs through initiatives in dairy, manufacturing, and innovation. Entrepreneurship is important for economic development as it creates jobs and drives competition.
Entrepreneurship development - Venturing Small BusinessSOMASUNDARAM T
Steps involved in starting a business venture; location, clearances and permits required, formalities, licensing and registration procedures; Feasibility study (financial, technical and social) of project; Sources of Finance: Short term and Long term (Venture Capital and Angel Investing)
Small industries development bank of indiaArushi Rajput
The Small Industries Development Bank of India (SIDBI) was founded in 1990 as the principal financial institution to promote, finance, and develop micro, small and medium enterprises in India. It was established as a wholly owned subsidiary of IDBI Bank under an Act of the Indian Parliament. SIDBI provides financing support to MSMEs, which contribute significantly to the Indian economy through production, employment, and exports. In addition to direct financing, SIDBI also engages in promotion, development, and coordination activities to strengthen the MSME sector.
IDFC is a major provider of infrastructure financing in India. Over the past 5 years, it has tripled its project approvals and nearly doubled its disbursements. It offers a wide range of financial products and services including project finance, private equity, asset management, and investment banking. IDFC has grown significantly in recent years, with its net worth increasing over 2.5 times and total assets growing nearly 3 times from 2005 to 2010. It aims to further support the development of infrastructure across India.
The document discusses the various steps involved in setting up an enterprise. It begins by explaining that setting up an enterprise is a complex process that requires knowledge of key business aspects. It then outlines 8 main steps provided by the Ministry of MSMEs for setting up micro, small, and medium enterprises, including project selection, arranging finance, approvals, and quality certification. The document provides details on each step, including requirements for a project feasibility study, business plan preparation, obtaining necessary clearances and licenses, and implementing the project. It stresses the importance of proper planning through a detailed project report.
Policy Support To Small Scale Industriesguestf9788dc7
The document outlines various policies introduced by the Indian government since 1947 to support small scale industries. Key policies include reserving certain products for exclusive production by small industries, fiscal incentives like tax holidays, and excise duty concessions. Support measures also include preferential pricing, technical assistance, and schemes for credit access, skill development and technology upgradation. The policies aim to promote rural employment and more inclusive industrialization.
Small Industries Development Bank of India SIDBI Milan Dhaduk
SIDBI was established in 1989 to promote and finance small scale industries. It provides direct financing, refinancing, bill financing, and international financing. It also offers promotional services like entrepreneurship training. SIDBI operates schemes to support technology upgrades, provide venture capital and equity funding, and offers seed money for new entrepreneurs through DICs. It aims to empower small and medium enterprises through financial and developmental assistance.
Here are some of the efforts taken up by SIDBI so that women are encouraged more towards opening their own business.
kindly go through the Schemes and it might be helpful to you in any sense.
Feedback is a must!!!!
Regards,
Nazneen Sheikh
1. The document discusses small scale industries (SSI) in India and their importance for employment generation and economic growth. SSIs are industries with fixed assets up to 1 crore rupees that employ hired labor and machines.
2. The government of India promotes SSIs through loans, subsidies, and guidance to entrepreneurs to address unemployment. Procedures for starting an SSI include selecting an industry, site, and preparing a scheme detailing production plans.
3. SSIs contribute significantly to employment in India and have seen rapid production growth in recent decades. The government provides various development programs and financial support to promote SSIs.
The document discusses SIDBI, an Indian financial institution that provides financing support to small and medium enterprises (SMEs). It notes that SMEs play an important role in India's economy, contributing to manufacturing, exports, employment, and GDP. SIDBI was established to boost SME industries through refinancing banks that provide loans to SMEs, as well as direct financing. Over time SIDBI has expanded its services and products to better support the financial needs of SMEs. It currently provides refinancing, bill financing, project financing, and other resources to help SME industries grow and develop.
This document discusses small scale industries (SSI) in India. It defines SSI and outlines how the investment limit for SSI classification has increased over time from Rs. 5 lakhs to Rs. 3 crore. It discusses the role of SSI in economic development through job creation, production increase, exports growth, and regional development. The document also outlines the steps to start an SSI, including project selection, registration, clearances, financing, and implementation. Government policies over time including IPR 1948, 1956, and 1977 provided support and protection to the small sector.
Small Enterprises and Enterprise Launching Formalitites UNIT IIIAman Sharma
Notes of Small Enterprises and Enterprise Launching Formalitites as Taught in Business Intelligence and Entrepreneurship in Engineering , Business and other courses
stimulus package, human capital index , non performing assetsAditiNathani1
The document defines and explains key business terms:
- Stimulus package refers to economic incentives announced by governments to stimulate the economy during financial crises. The Indian government announced a $266 billion stimulus package to boost sectors like MSMEs.
- NPAs are loans that are declared non-performing when the borrower is unable to repay principal or interest. If collateral is pledged it may be liquidated to repay the lender.
- The human capital index measures the productivity of a country's workforce based on education and health outcomes. Countries like Singapore, China, and Japan rank highly in terms of developing human capital.
SIDBI and MSFC play important roles in providing financial services to support small and medium enterprises in India. SIDBI was established by the government in 1989 as the apex institution to oversee financing for small and medium industries. It provides loans, refinancing, import/export support, and development programs. MSFC was established in 1962 and supports industries in Maharashtra, Goa, and Daman and Diu by providing term loans for assets, expansion, and modernization of small and medium businesses. Both organizations aim to promote industry and economic development in India.
The document discusses foreign direct investment in India, including key facts and ways for foreign companies to set up business in India. It outlines the main entry routes of forming a corporate entity like a wholly owned subsidiary or limited liability partnership. Setting up a wholly owned subsidiary requires compliance with Company Law and FEMA regulations, and involves obtaining necessary approvals, reserving the company name, drafting legal documents, and making statutory filings. A limited liability partnership is a suitable lower-cost option for small businesses and involves similar registration procedures with applicable authorities in India.
This document discusses different types of business combinations including horizontal, vertical, diagonal, circular, and lateral combinations.
It provides examples and definitions of each type. Horizontal combinations involve firms producing similar products, vertical combinations involve firms in successive stages of production, diagonal combinations combine auxiliary service firms, and circular combinations combine unrelated firms under common management.
The document also discusses the advantages and disadvantages of business combinations. Advantages include eliminating competition, solving capital problems, achieving economies of scale, and effective management. Disadvantages include creating monopolies, concentrating wealth, and costly management.
Finally, it discusses mergers and acquisitions, defining them as the combination of two or more firms through asset or security exchanges, and noting their
IDFC First Bank: Analysis and Outlook Mitali Pania
This document analyzes IDFC FIRST BANK. It provides an overview of trends in the Indian banking sector, including strong credit growth. It outlines the merger that formed IDFC FIRST BANK and describes its leadership and shareholding. The document observes trends in the bank's financials like rising net interest income and CASA deposits. Capital adequacy ratios are projected to gradually decline but remain above regulatory limits. Non-performing assets are expected to fall to healthy levels by 2024-25.
The document discusses the real estate sector in India. It notes that real estate is the second largest employer in India and supports around 250 ancillary industries. The sector has seen increased demand for both residential and commercial property, with Indian cities becoming attractive investment destinations. Real estate development in India is a $12 billion market growing at 30% annually. The future of the sector is guided by factors like amendments to foreign direct investment guidelines and changes to service tax norms to promote growth.
This document discusses various sources of finance for businesses. It identifies external and internal sources of finance. External sources include issuing shares, debentures, accepting public deposits, and taking loans from financial institutions and banks. Internal sources include retained profits that are reinvested in the business. Long term sources are used for fixed capital needs and include equity, debt, and retained profits. Short term sources like loans and deposits are used for working capital needs.
SIDBI was established in 1989 to promote and finance small industries in India. It provides financial services like loans, refinancing, and technology upgrades to MSMEs. SIDBI also coordinates with other institutions involved in MSME development. Its vision is to be a single window for meeting MSME financial and development needs. SIDBI launched the Make in India Soft Loan Fund to facilitate investment in 25 priority sectors and help existing MSMEs expand through access to competitive financing. Eligible enterprises include all MSMEs as defined by Indian law, with an emphasis on new and smaller manufacturing and service businesses.
- India is one of the fastest growing economies in the world, averaging over 7% growth per year for the last 4 years. It has liberalized its FDI policy and tax structure to promote foreign investment.
- India ranks highly in indices measuring foreign investment confidence due to its large market size, skilled workforce, and pro-business reforms. Major sectors attracting FDI include services, manufacturing, and infrastructure.
- Advantages for foreign investors in India include its large English-speaking population, growing middle class, abundant natural resources, and stable democratic and economic system. Joint ventures are a common entry strategy for foreign companies investing in India.
The document discusses several Indian institutions that provide support for entrepreneurs and small businesses. The National Institute for Entrepreneurship and Small Business Development (NIESBUD) was established in 1983 to coordinate entrepreneurship development activities across institutions. The Entrepreneurship Development Institute of India (EDII) and Small Industries Service Institutes (SISIs) provide training programs and technical support services. District Industries Centers (DICs) promote small industries at the district level. The National Entrepreneurship Development Board (NEDB) recommends schemes to promote self-employment.
The Industrial Finance Corporation of India (IFCI) was established in 1948 as the first development financial institution in India to provide long-term financing to industrial sectors. IFCI's authorized capital was initially Rs. 10 crores but was later raised to Rs. 20 crores. IFCI engages in direct financing, incidental activities, and promotional activities to support industries, including providing rupee and foreign currency loans, loan guarantees, technical assistance, and merchant banking services. IFCI obtains its resources from sources such as the Reserve Bank of India, share capital, retained earnings, bond issues, government loans, and international sources.
This document discusses the relevance of development financial institutions in the Indian financial system. It outlines several prominent DFIs in India such as IFCI, IDBI, SIDBI, EXIM Bank, and NABARD. These institutions provide long-term financing for infrastructure, agriculture, SMEs and more to fill gaps in the financial sector. They offer services like project financing, refinancing, and promoting industries. The document also details the roles and functions of each institution.
The document discusses the various steps involved in setting up an enterprise. It begins by explaining that setting up an enterprise is a complex process that requires knowledge of key business aspects. It then outlines 8 main steps provided by the Ministry of MSMEs for setting up micro, small, and medium enterprises, including project selection, arranging finance, approvals, and quality certification. The document provides details on each step, including requirements for a project feasibility study, business plan preparation, obtaining necessary clearances and licenses, and implementing the project. It stresses the importance of proper planning through a detailed project report.
Policy Support To Small Scale Industriesguestf9788dc7
The document outlines various policies introduced by the Indian government since 1947 to support small scale industries. Key policies include reserving certain products for exclusive production by small industries, fiscal incentives like tax holidays, and excise duty concessions. Support measures also include preferential pricing, technical assistance, and schemes for credit access, skill development and technology upgradation. The policies aim to promote rural employment and more inclusive industrialization.
Small Industries Development Bank of India SIDBI Milan Dhaduk
SIDBI was established in 1989 to promote and finance small scale industries. It provides direct financing, refinancing, bill financing, and international financing. It also offers promotional services like entrepreneurship training. SIDBI operates schemes to support technology upgrades, provide venture capital and equity funding, and offers seed money for new entrepreneurs through DICs. It aims to empower small and medium enterprises through financial and developmental assistance.
Here are some of the efforts taken up by SIDBI so that women are encouraged more towards opening their own business.
kindly go through the Schemes and it might be helpful to you in any sense.
Feedback is a must!!!!
Regards,
Nazneen Sheikh
1. The document discusses small scale industries (SSI) in India and their importance for employment generation and economic growth. SSIs are industries with fixed assets up to 1 crore rupees that employ hired labor and machines.
2. The government of India promotes SSIs through loans, subsidies, and guidance to entrepreneurs to address unemployment. Procedures for starting an SSI include selecting an industry, site, and preparing a scheme detailing production plans.
3. SSIs contribute significantly to employment in India and have seen rapid production growth in recent decades. The government provides various development programs and financial support to promote SSIs.
The document discusses SIDBI, an Indian financial institution that provides financing support to small and medium enterprises (SMEs). It notes that SMEs play an important role in India's economy, contributing to manufacturing, exports, employment, and GDP. SIDBI was established to boost SME industries through refinancing banks that provide loans to SMEs, as well as direct financing. Over time SIDBI has expanded its services and products to better support the financial needs of SMEs. It currently provides refinancing, bill financing, project financing, and other resources to help SME industries grow and develop.
This document discusses small scale industries (SSI) in India. It defines SSI and outlines how the investment limit for SSI classification has increased over time from Rs. 5 lakhs to Rs. 3 crore. It discusses the role of SSI in economic development through job creation, production increase, exports growth, and regional development. The document also outlines the steps to start an SSI, including project selection, registration, clearances, financing, and implementation. Government policies over time including IPR 1948, 1956, and 1977 provided support and protection to the small sector.
Small Enterprises and Enterprise Launching Formalitites UNIT IIIAman Sharma
Notes of Small Enterprises and Enterprise Launching Formalitites as Taught in Business Intelligence and Entrepreneurship in Engineering , Business and other courses
stimulus package, human capital index , non performing assetsAditiNathani1
The document defines and explains key business terms:
- Stimulus package refers to economic incentives announced by governments to stimulate the economy during financial crises. The Indian government announced a $266 billion stimulus package to boost sectors like MSMEs.
- NPAs are loans that are declared non-performing when the borrower is unable to repay principal or interest. If collateral is pledged it may be liquidated to repay the lender.
- The human capital index measures the productivity of a country's workforce based on education and health outcomes. Countries like Singapore, China, and Japan rank highly in terms of developing human capital.
SIDBI and MSFC play important roles in providing financial services to support small and medium enterprises in India. SIDBI was established by the government in 1989 as the apex institution to oversee financing for small and medium industries. It provides loans, refinancing, import/export support, and development programs. MSFC was established in 1962 and supports industries in Maharashtra, Goa, and Daman and Diu by providing term loans for assets, expansion, and modernization of small and medium businesses. Both organizations aim to promote industry and economic development in India.
The document discusses foreign direct investment in India, including key facts and ways for foreign companies to set up business in India. It outlines the main entry routes of forming a corporate entity like a wholly owned subsidiary or limited liability partnership. Setting up a wholly owned subsidiary requires compliance with Company Law and FEMA regulations, and involves obtaining necessary approvals, reserving the company name, drafting legal documents, and making statutory filings. A limited liability partnership is a suitable lower-cost option for small businesses and involves similar registration procedures with applicable authorities in India.
This document discusses different types of business combinations including horizontal, vertical, diagonal, circular, and lateral combinations.
It provides examples and definitions of each type. Horizontal combinations involve firms producing similar products, vertical combinations involve firms in successive stages of production, diagonal combinations combine auxiliary service firms, and circular combinations combine unrelated firms under common management.
The document also discusses the advantages and disadvantages of business combinations. Advantages include eliminating competition, solving capital problems, achieving economies of scale, and effective management. Disadvantages include creating monopolies, concentrating wealth, and costly management.
Finally, it discusses mergers and acquisitions, defining them as the combination of two or more firms through asset or security exchanges, and noting their
IDFC First Bank: Analysis and Outlook Mitali Pania
This document analyzes IDFC FIRST BANK. It provides an overview of trends in the Indian banking sector, including strong credit growth. It outlines the merger that formed IDFC FIRST BANK and describes its leadership and shareholding. The document observes trends in the bank's financials like rising net interest income and CASA deposits. Capital adequacy ratios are projected to gradually decline but remain above regulatory limits. Non-performing assets are expected to fall to healthy levels by 2024-25.
The document discusses the real estate sector in India. It notes that real estate is the second largest employer in India and supports around 250 ancillary industries. The sector has seen increased demand for both residential and commercial property, with Indian cities becoming attractive investment destinations. Real estate development in India is a $12 billion market growing at 30% annually. The future of the sector is guided by factors like amendments to foreign direct investment guidelines and changes to service tax norms to promote growth.
This document discusses various sources of finance for businesses. It identifies external and internal sources of finance. External sources include issuing shares, debentures, accepting public deposits, and taking loans from financial institutions and banks. Internal sources include retained profits that are reinvested in the business. Long term sources are used for fixed capital needs and include equity, debt, and retained profits. Short term sources like loans and deposits are used for working capital needs.
SIDBI was established in 1989 to promote and finance small industries in India. It provides financial services like loans, refinancing, and technology upgrades to MSMEs. SIDBI also coordinates with other institutions involved in MSME development. Its vision is to be a single window for meeting MSME financial and development needs. SIDBI launched the Make in India Soft Loan Fund to facilitate investment in 25 priority sectors and help existing MSMEs expand through access to competitive financing. Eligible enterprises include all MSMEs as defined by Indian law, with an emphasis on new and smaller manufacturing and service businesses.
- India is one of the fastest growing economies in the world, averaging over 7% growth per year for the last 4 years. It has liberalized its FDI policy and tax structure to promote foreign investment.
- India ranks highly in indices measuring foreign investment confidence due to its large market size, skilled workforce, and pro-business reforms. Major sectors attracting FDI include services, manufacturing, and infrastructure.
- Advantages for foreign investors in India include its large English-speaking population, growing middle class, abundant natural resources, and stable democratic and economic system. Joint ventures are a common entry strategy for foreign companies investing in India.
The document discusses several Indian institutions that provide support for entrepreneurs and small businesses. The National Institute for Entrepreneurship and Small Business Development (NIESBUD) was established in 1983 to coordinate entrepreneurship development activities across institutions. The Entrepreneurship Development Institute of India (EDII) and Small Industries Service Institutes (SISIs) provide training programs and technical support services. District Industries Centers (DICs) promote small industries at the district level. The National Entrepreneurship Development Board (NEDB) recommends schemes to promote self-employment.
The Industrial Finance Corporation of India (IFCI) was established in 1948 as the first development financial institution in India to provide long-term financing to industrial sectors. IFCI's authorized capital was initially Rs. 10 crores but was later raised to Rs. 20 crores. IFCI engages in direct financing, incidental activities, and promotional activities to support industries, including providing rupee and foreign currency loans, loan guarantees, technical assistance, and merchant banking services. IFCI obtains its resources from sources such as the Reserve Bank of India, share capital, retained earnings, bond issues, government loans, and international sources.
This document discusses the relevance of development financial institutions in the Indian financial system. It outlines several prominent DFIs in India such as IFCI, IDBI, SIDBI, EXIM Bank, and NABARD. These institutions provide long-term financing for infrastructure, agriculture, SMEs and more to fill gaps in the financial sector. They offer services like project financing, refinancing, and promoting industries. The document also details the roles and functions of each institution.
Development financial institution & District investment centerAman Sachan
Development financial institutions provide medium and long-term financial assistance to promote key sectors like industry, agriculture, and more. They include institutions like the World Bank and IMF. This document discusses various types of financial institutions in India that provide funding support at different levels. It covers term lending institutions like IFCI, IDBI, ICICI, and EXIM Bank. It also discusses refinancing institutions like NABARD, SIDBI, and NHB, as well as investment institutions like LIC and GIC. The roles and functions of these various institutions in promoting industries are described.
This document discusses various types of institutional finance available to entrepreneurs in India from government agencies, including equity capital, term loans, and working capital. It outlines several agencies that provide financing such as commercial banks, the Industrial Development Bank of India (IDBI), the Industrial Finance Corporation of India (IFCI), the Industrial Credit and Investment Corporation of India (ICICI), and the Small Industries Development Bank of India (SIDBI). Each agency offers different loan terms and interest rates targeted towards small businesses and entrepreneurs.
The Small Industries Development Bank of India (SIDBI) was established in 1989 as the principal financial institution for promoting, financing and developing small industries in India. SIDBI's mission is to empower micro, small and medium enterprises to make them strong, vibrant and globally competitive. Its key objectives are financing, promotion, development and coordination of small industries. SIDBI offers various direct financing, refinancing, bills financing and international financing schemes as well as promotional and developmental activities like entrepreneurship training to support small businesses.
The Industrial Finance Corporation of India (IFCI) was established in 1948 as the first all-India term-lending institution to provide medium and long-term credit to industry. It is headquartered in New Delhi and sources funds from paid-up capital, reserves, market borrowings, government loans, and foreign credit lines. The Industrial Credit and Investment Corporation of India (ICICI) was established in 1955 and is headquartered in Mumbai. It provides various financial services including project financing, banking, asset management, and mutual funds to Indian businesses. The Industrial Development Bank of India (IDBI) was established in 1964 and is headquartered in Mumbai. It aims to promote and develop industries by providing financial and technical
Small scale industry an introduction --indiaBinod Sinha
This document provides an introduction and overview of small scale industries (SSI) in India. It discusses how SSI makes up an important segment of the Indian economy. It defines micro, small, and medium enterprises based on their level of investment. It outlines the characteristics of small enterprises, including how they are locally focused, labor intensive, flexible, and help promote regional development. The document also discusses the advantages SSI provide like job creation and the rationale for their development in India like addressing unemployment.
This document provides information on different types of development financial institutions in India. It discusses term lending institutions like IFCI, IDBI, ICICI, and EXIM Bank that provide medium and long-term financing for industry, agriculture, and other sectors. It also covers refinancing institutions like NABARD, SIDBI, and NHB that help allocate funds to other financial organizations. Finally, it mentions investment institutions like LIC and GIC that collect money and invest in other securities.
The document summarizes several major financial institutions in India:
The Unit Trust of India (UTI) is an investment trust that mobilizes savings from small investors and channels them into shares and debentures of profitable companies to allow investors to participate in industrial growth.
The Industrial Development Bank of India (IDBI) was established to provide term financing to industry and coordinate other financial institutions. It aims to support industrial development.
State Financial Corporations (SFCs) were established to meet the financial needs of small and medium enterprises. They provide loans and assistance.
The Industrial Finance Corporation of India (IFCI) provides medium and long term credit to industrial projects in corporate and cooperative sectors. It aims
The document discusses various sources of finance for small and medium scale industries in India. It outlines short, medium, and long term financing options and the types of financial assistance provided by institutions like SFCs, SIDBI, and commercial banks. Some key points include: short term finance is for less than 1 year for working capital; medium term is 1-5 years for capital expenditures; long term is over 5 years for fixed assets or expansions. Financial assistance includes term loans at concessional rates, refinancing support, and schemes to promote modernization and development of small/medium enterprises.
The document discusses various institutions that provide support to industries in Karnataka, including the Karnataka Industrial Areas Development Board (KIADB), Karnataka Small Scale Industries Development Corporation (KSSIDC), Karnataka State Industrial Investment and Development Corporation (KSIMC), National Small Industries Corporation (NSIC), District Industries Centres (DICs), and Small Industries Development Bank of India (SIDBI). It provides details on the functions and services provided by these institutions such as acquiring land for industrial areas, providing infrastructure, term loans, refinancing, entrepreneurship training, and more.
Development banks are financial institutions that promote economic development, especially in developing countries. They provide financing to key sectors like industry and agriculture. Development banks undertake financial risks to promote economic growth. They provide various forms of long-term financing like loans, underwriting, and investments. Development banks differ from commercial banks in that they do not accept deposits from the public and focus on medium and long-term lending. Their objective is public interest over profits.
Development banks are financial institutions that provide long-term loans and assistance to promote social and economic development in their member countries. Their main goals are reducing poverty and improving people's lives. They support a variety of development projects and activities through loans and technical assistance. Some examples of development banks mentioned are the Asian Development Bank, IFCI, IDBI, ICICI, and LIC.
SIDBI is the principal financial institution for promotion, financing and development of MSMEs in India. It provides various financial services like direct financing, refinancing, bill financing, and international financing to MSMEs. It also engages in promotional activities like entrepreneurship training. Some key schemes include Technology Upgradation Fund Scheme, Venture Capital Fund Scheme, and National Equity Fund Scheme. SIDBI aims to empower and support the growth of MSMEs through its financial and developmental activities.
The document provides an overview of financial institutions in India, including their definition, functions, classifications, and examples. It discusses regulatory institutions like RBI and SEBI, as well as intermediaries like IFCI, ICICI, IDBI, LIC, SIDBI, state financial corporations, and specialized institutions like EXIM Bank. It describes the roles of these institutions, the types of assistance they provide like loans and guarantees, and the process of project appraisal.
The document discusses various development banks and financial institutions in India that provide assistance to different sectors. It summarizes the objectives and functions of key institutions like IDBI, ICICI, SIDBI, IFCI, IIBI, EXIM Bank, NABARD, SFCs and SIDCs. IDBI provides long term financing to industries while SIDBI focuses on small and medium enterprises. EXIM Bank finances exports and imports. NABARD works on uplifting rural India. SFCs and SIDCs cater to state-level industrial development.
Class 12 Entrepreneurship CH-6 Resource MobilizationShwetha786786
The Industrial Finance Corporation of India (IFCI) was established in 1948 to provide medium and long-term financing to industry. It provides loans, subscribes to debentures, and provides guarantees to industrial companies. IFCI also underwrites securities and has subsidiaries that assist with financing. The Industrial Credit and Investment Corporation of India (ICICI) was established in 1955 to develop small and medium private industries and was later merged with ICICI Bank. State Financial Corporations (SFCs) promote small and medium industries in each state and provide loans, underwrite shares, and guarantee other loans for industrial development.
- Development Financial Institutions (DFIs) were established by governments to provide long-term financing for industrial and infrastructure projects due to the risky and long-gestation nature of such projects.
- Over time, as financial systems became more sophisticated in risk management, banks and bond markets became better able to finance such projects, reducing the need for DFIs with government support.
- In India, the first DFI was established in 1948 and many more were set up over the subsequent decades to promote development across various sectors, with some focused on long-term lending and others on refinancing.
The document discusses small scale industries in India. It states that small scale industries are a very important segment of the Indian economy, providing employment and contributing to exports. It defines micro, small and medium enterprises based on their investment in plant and machinery or equipment. Small enterprises have advantages like creating more jobs, being set up easily in rural areas, and fostering local entrepreneurship. They play an important role in socio-economic development.
Similar to M-com(final)year solved assignment........... (20)
The document discusses the benefits of exercise for mental health. Regular physical activity can help reduce anxiety and depression and improve mood and cognitive functioning. Exercise causes chemical changes in the brain that may help protect against mental illness and improve symptoms.
The document discusses the benefits of exercise for mental health. Regular physical activity can help reduce anxiety and depression and improve mood and cognitive function. Exercise causes chemical changes in the brain that may help protect against mental illness and improve symptoms.
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The document discusses the benefits of exercise for mental health. Regular physical activity can help reduce anxiety and depression and improve mood and cognitive function. Exercise causes chemical changes in the brain that may help protect against developing mental illness and improve symptoms for those who already suffer from conditions like anxiety and depression.
The document discusses various aspects of financial management and control for corporations, including:
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2. Inventory management oversees ordering, storage, and use of components and finished products to control costs and prevent shortages or excess inventory.
3. Capitalization of profits converts retained earnings to capital by issuing stock dividends to existing shareholders.
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This document provides an overview of concepts covered in a unit on managerial economics. It defines managerial economics and explains its key characteristics and scope. The unit aims to help students understand managerial economics and apply its techniques to decision making. It will take approximately 12 hours to complete, including time to read the material, do a self-assessment, and complete an assignment. The content is organized into sections covering topics like the concepts, techniques, and applications of managerial economics.
The document summarizes guidelines for writing an effective literature review for a dissertation. It begins by explaining the importance of the literature review in establishing the rationale and framework for the dissertation research. It then discusses the key purposes and taxonomy of literature reviews, including their focus, goals, perspective, coverage, and organization. The document outlines the process for conducting a literature review, noting it parallels the process for primary research. This involves formulating the problem, collecting and evaluating data, analyzing and interpreting the findings, and presenting the results. Finally, it discusses common mistakes and provides a framework to self-evaluate the quality of the literature review.
This document summarizes Weber's theory of industrial location and discusses various sources of finance available to industrial units. Weber classified location factors into primary/regional factors like transportation costs and labor costs, and secondary/agglomerative factors. The main sources of industrial finance in India include institutions like IDBI, ICICI, SIDBI, IFCI, and IIBL which provide loans, as well as sources like state financial corporations, foreign investment, IPOs, and more.
This document contains 20 multiple choice and essay questions regarding the Assam High Secondary Exam for Accountancy. The questions cover a range of accounting topics including financial statements, ratio analysis, partnership accounts, and company accounts. Students are asked to define terms, calculate amounts, journalize transactions, and prepare financial statements. The questions require knowledge of concepts like income and expenditure accounts, capital accounts, asset revaluation, partnership dissolution, and debenture issuance.
This document contains an accountancy exam paper with 20 multiple choice and essay questions. It covers topics like accounting entries, financial statement analysis, partnership accounts, and company accounts. The questions require calculations, journal entries, explaining concepts and distinguishing between different accounting terms. It tests a student's understanding of key topics in the accountancy syllabus for Class 12.
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The document discusses the benefits of exercise for mental health. Regular physical activity can help reduce anxiety and depression and improve mood and cognitive function. Exercise causes chemical changes in the brain that may help protect against mental illness and improve symptoms for those who already suffer from conditions like depression and anxiety.
Philippine Edukasyong Pantahanan at Pangkabuhayan (EPP) CurriculumMJDuyan
(𝐓𝐋𝐄 𝟏𝟎𝟎) (𝐋𝐞𝐬𝐬𝐨𝐧 𝟏)-𝐏𝐫𝐞𝐥𝐢𝐦𝐬
𝐃𝐢𝐬𝐜𝐮𝐬𝐬 𝐭𝐡𝐞 𝐄𝐏𝐏 𝐂𝐮𝐫𝐫𝐢𝐜𝐮𝐥𝐮𝐦 𝐢𝐧 𝐭𝐡𝐞 𝐏𝐡𝐢𝐥𝐢𝐩𝐩𝐢𝐧𝐞𝐬:
- Understand the goals and objectives of the Edukasyong Pantahanan at Pangkabuhayan (EPP) curriculum, recognizing its importance in fostering practical life skills and values among students. Students will also be able to identify the key components and subjects covered, such as agriculture, home economics, industrial arts, and information and communication technology.
𝐄𝐱𝐩𝐥𝐚𝐢𝐧 𝐭𝐡𝐞 𝐍𝐚𝐭𝐮𝐫𝐞 𝐚𝐧𝐝 𝐒𝐜𝐨𝐩𝐞 𝐨𝐟 𝐚𝐧 𝐄𝐧𝐭𝐫𝐞𝐩𝐫𝐞𝐧𝐞𝐮𝐫:
-Define entrepreneurship, distinguishing it from general business activities by emphasizing its focus on innovation, risk-taking, and value creation. Students will describe the characteristics and traits of successful entrepreneurs, including their roles and responsibilities, and discuss the broader economic and social impacts of entrepreneurial activities on both local and global scales.
Leveraging Generative AI to Drive Nonprofit InnovationTechSoup
In this webinar, participants learned how to utilize Generative AI to streamline operations and elevate member engagement. Amazon Web Service experts provided a customer specific use cases and dived into low/no-code tools that are quick and easy to deploy through Amazon Web Service (AWS.)
ISO/IEC 27001, ISO/IEC 42001, and GDPR: Best Practices for Implementation and...PECB
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Date: May 29, 2024
Tags: Information Security, ISO/IEC 27001, ISO/IEC 42001, Artificial Intelligence, GDPR
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Communicating effectively and consistently with students can help them feel at ease during their learning experience and provide the instructor with a communication trail to track the course's progress. This workshop will take you through constructing an engaging course container to facilitate effective communication.
বাংলাদেশের অর্থনৈতিক সমীক্ষা ২০২৪ [Bangladesh Economic Review 2024 Bangla.pdf] কম্পিউটার , ট্যাব ও স্মার্ট ফোন ভার্সন সহ সম্পূর্ণ বাংলা ই-বুক বা pdf বই " সুচিপত্র ...বুকমার্ক মেনু 🔖 ও হাইপার লিংক মেনু 📝👆 যুক্ত ..
আমাদের সবার জন্য খুব খুব গুরুত্বপূর্ণ একটি বই ..বিসিএস, ব্যাংক, ইউনিভার্সিটি ভর্তি ও যে কোন প্রতিযোগিতা মূলক পরীক্ষার জন্য এর খুব ইম্পরট্যান্ট একটি বিষয় ...তাছাড়া বাংলাদেশের সাম্প্রতিক যে কোন ডাটা বা তথ্য এই বইতে পাবেন ...
তাই একজন নাগরিক হিসাবে এই তথ্য গুলো আপনার জানা প্রয়োজন ...।
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Chapter wise All Notes of First year Basic Civil Engineering.pptxDenish Jangid
Chapter wise All Notes of First year Basic Civil Engineering
Syllabus
Chapter-1
Introduction to objective, scope and outcome the subject
Chapter 2
Introduction: Scope and Specialization of Civil Engineering, Role of civil Engineer in Society, Impact of infrastructural development on economy of country.
Chapter 3
Surveying: Object Principles & Types of Surveying; Site Plans, Plans & Maps; Scales & Unit of different Measurements.
Linear Measurements: Instruments used. Linear Measurement by Tape, Ranging out Survey Lines and overcoming Obstructions; Measurements on sloping ground; Tape corrections, conventional symbols. Angular Measurements: Instruments used; Introduction to Compass Surveying, Bearings and Longitude & Latitude of a Line, Introduction to total station.
Levelling: Instrument used Object of levelling, Methods of levelling in brief, and Contour maps.
Chapter 4
Buildings: Selection of site for Buildings, Layout of Building Plan, Types of buildings, Plinth area, carpet area, floor space index, Introduction to building byelaws, concept of sun light & ventilation. Components of Buildings & their functions, Basic concept of R.C.C., Introduction to types of foundation
Chapter 5
Transportation: Introduction to Transportation Engineering; Traffic and Road Safety: Types and Characteristics of Various Modes of Transportation; Various Road Traffic Signs, Causes of Accidents and Road Safety Measures.
Chapter 6
Environmental Engineering: Environmental Pollution, Environmental Acts and Regulations, Functional Concepts of Ecology, Basics of Species, Biodiversity, Ecosystem, Hydrological Cycle; Chemical Cycles: Carbon, Nitrogen & Phosphorus; Energy Flow in Ecosystems.
Water Pollution: Water Quality standards, Introduction to Treatment & Disposal of Waste Water. Reuse and Saving of Water, Rain Water Harvesting. Solid Waste Management: Classification of Solid Waste, Collection, Transportation and Disposal of Solid. Recycling of Solid Waste: Energy Recovery, Sanitary Landfill, On-Site Sanitation. Air & Noise Pollution: Primary and Secondary air pollutants, Harmful effects of Air Pollution, Control of Air Pollution. . Noise Pollution Harmful Effects of noise pollution, control of noise pollution, Global warming & Climate Change, Ozone depletion, Greenhouse effect
Text Books:
1. Palancharmy, Basic Civil Engineering, McGraw Hill publishers.
2. Satheesh Gopi, Basic Civil Engineering, Pearson Publishers.
3. Ketki Rangwala Dalal, Essentials of Civil Engineering, Charotar Publishing House.
4. BCP, Surveying volume 1
How to Make a Field Mandatory in Odoo 17Celine George
In Odoo, making a field required can be done through both Python code and XML views. When you set the required attribute to True in Python code, it makes the field required across all views where it's used. Conversely, when you set the required attribute in XML views, it makes the field required only in the context of that particular view.
Strategies for Effective Upskilling is a presentation by Chinwendu Peace in a Your Skill Boost Masterclass organisation by the Excellence Foundation for South Sudan on 08th and 09th June 2024 from 1 PM to 3 PM on each day.
Temple of Asclepius in Thrace. Excavation resultsKrassimira Luka
The temple and the sanctuary around were dedicated to Asklepios Zmidrenus. This name has been known since 1875 when an inscription dedicated to him was discovered in Rome. The inscription is dated in 227 AD and was left by soldiers originating from the city of Philippopolis (modern Plovdiv).
1. Solved Assignment for M-Com Final year
1. Discuss Weber’s theory of location of industry. What are the various sources of finance to industrial
units? Discuss.
Ans: Weber's Theory of Industrial Location
The classical economist Adam Smith gave the first thought to the problem of industrial location.
The factors of location enunciated by him were the results of empirical analysis rather than a scientific
treatment of the problem. Alfred Weber, the German economist, attempted an analytical approach to
the problem of industrial location.
Weber classified the factors or causes affecting industrial location into two main categories:
Primary factors or Regional factors
Secondary factors or Agglomerative factors
Primary or Regional Factors
Weber analysed the factors Weber analysed the factors of location of industries referring to the
costs of production, which vary with different regional factors. The factors like depreciation,
amortisation, interest rate and rent of the land etc, were specially excluded by him, as they exert little
influence on the geographical location of industrial plants.
Transportation Costs
The location of industries is governed in the first instance by the cost of transportation. Such
costs are incurred by the industry twice first, when the raw material is imported from the source to the
place of production and secondly, when the products are sent to the market for selling. Total
transportation costs, in turn, are determined by:
The distance to be covered
The weight to be transported
Labour Costs
The second primary reason which influences the location of industry is the cost of labour. Weber
assumed certain centres to be the centres of cheap and skilled labour. Industries where labour is an
important element of cost, will be attracted towards cheap and skilled labour centres. On the other
hand, if the cost of labour is not significant, the transportation cost will decide the location. With the
caption of “Weber's Theory of Industrial Location” animate the below given image.
2. The main sources of industrial finance in India are following:
Industrial Development Bank of India (IDBI): It provides credit and other facilities for industrial
development in the country. It provides long term finance for green field projects, as also for
modernization, expansion and diversification. It has structured various products such as equipment,
asset credit and corporate loans in order to eater to the diverse needs of its corporate clients.
Industrial credit and investment corporation of India Limited (ICICI Ltd.): It played a facilitating
role in consolidation in various sectors of the Indian industry, by funding mergers and acquisitions. The
ICICI group’s financing and banking operations, both whole sale and retail have been integrated into a
single company effective from May 2002.
Small Industries Development Bank of India (SIDBI): It offers refinance, bills rediscounting lines
of credit and resource support mechanisms to route assistance to SSI sector through a network of banks
and state-level financial institutions. It also offers direct finance for meeting specific requirements of SSI
sector.
Industrial Finance corporation of India Limited (IFCI Ltd): Its main financing comprises of
projects finance, financial services and corporate advisory services. It provides custodial and investor
services rating and venture capital services through its subsidiaries and associate companies.
Industrial Investment Bank of India Limited (IIBI Ltd): It offers a variety of financial products
such as Project finance, short duration none-project asset-backed finance and working capital and other
short term loans to companies.
3. Infrastructure Development finance company Limited (IDFC Ltd): It was incorporated in 1997
and was conceived as specialized institution to facilitate the flow of private finance to commercially
viable infrastructure projects through innovative products and processes.
Industrial Reconstruction Bank of India (IRBI): It has main aim to revive sick industries and
make them able to exist and compete in market by assistance.
State financial corporation’s (SFCs): It provides loans to need industries. They also
promote shares and debentures, if required they would provide guarantee for loans of third parties.
Apart from these through foreign investments, IPOs, these industries also get financial assistance.
2. Write short notes on (any two):
(a) Optimum size of units.
(b) Micro, small and medium enterprises
(c) NEDFi
Ans: (b) Micro, Small and Medium Enterprises
The Government of India has enacted the Micro, Small and Medium Enterprises Development
(MSMED) Act, 2006 in terms of which the definition of micro, small and medium enterprises is as under:
(a) Enterprises engaged in the manufacture or production, processing or preservation of goods
as specified below:
(i) A micro enterprise is an enterprise where investment in plant and machinery does not exceed
Rs. 25 lakh;
(ii) A small enterprise is an enterprise where the investment in plant and machinery is more than
Rs. 25 lakh but does not exceed Rs. 5 crore; and
(iii) A medium enterprise is an enterprise where the investment in plant and machinery is more
than Rs.5 crore but does not exceed Rs.10 crore.
In case of the above enterprises, investment in plant and machinery is the original cost excluding
land and building and the items specified by the Ministry of Small Scale Industries vide its notification
No.S.O.1722 (E) dated October 5, 2006
(b) Enterprises engaged in providing or rendering of services and whose investment in
equipment (original cost excluding land and building and furniture, fittings and other items not directly
related to the service rendered or as may be notified under the MSMED Act, 2006 are specified below.
i.
10 lakh;
A micro enterprise is an enterprise where the investment in equipment does not exceed Rs.
ii.
A small enterprise is an enterprise where the investment in equipment is more than Rs.10
lakh but does not exceed Rs. 2 crore; and
4. iii.
A medium enterprise is an enterprise where the investment in equipment is more than Rs. 2
crore but does not exceed Rs. 5 crore.
(c) NEDFi
The North Eastern Development Finance Corporation Ltd (NEDFi) is a Public Limited Company
registered under the Companies Act 1956 on 9th August, 1995. It is notified as a Public Financial
Institution under Section 4A of the said Act and was registered as an NBFC in 2002 with RBI. The
shareholders of the Corporation are IDBI, SBI, LICI, SIDBI, ICICI, IFCI, SUUTI, GIC and its subsidiaries. The
management of NEDFi has been entrusted upon the Board of Directors comprising representatives from
shareholder institutions, Diner, State Governments and eminent persons from the NE Region and
outside having wide experience in industry, economics, finance and management.
NEDFi provides financial assistance to micro, small, medium and large enterprises for setting up
industrial, infrastructure and agri-allied projects in the North Eastern Region of India and also
Microfinance through MFI/NGOs. Besides financing, the Corporation offers Consultancy & Advisory
services to the state Governments, private sectors and other agencies. We conduct sector or state
specific studies under its Techno-Economic Development Fund (TEDF) and are the designated nodal
agency for disbursal of Govt. of India incentives to the industries in the North-East India under North–
East Industrial and Investment Promotion Policy 2007 (NEIIPP 2007). Our promotional activities include
NEDFi Haat, NEDFi Convention Center, and NEDFi Pavillion etc.
NEDFi is an ISO 9001:2008 certified company since 2001 and our mission is for the economic
development of the North Eastern Region of India by identifying, financing and nurturing commercially
and financially viable projects in the region.
1. Discuss the distinctive features of modern approach to financial management.
Ans: MODERN APPROACH TO FINANCIAL MANAGEMENT
Henry Ford has once remarked “Money is an arm or a leg; you either use it or lose it”. Though
the above statement looks simple but it is quite meaningful. In the today’s money oriented economy
finance is one of the basic foundations of all kinds of economic activities. Actually finance is the
backbone of every business.
MEANING OF BUSINESS FINANCE
Business Finance is the business activity that is concerned with the acquisition and conservation
of capital funds in meeting financial needs and overall objectives of a business enterprise. There are
three A’s in Financial Management
Anticipating Financial needs
Acquiring Financial Resources
Allocating funds in business
MANAGEMENT OF MONEY IN BUSINESS
Handling a business is similar to handling a home, with all the different expenses to consider
preventing the business from going under with deficits and bankruptcy. A business has “children” in
terms of all the employed workers working hand-in-hand and with utmost efficiency to make sure that
5. the finances float above break even. There is one main focus for a business to thrive and exist in security
and balance, and that is the knowledge of knowing how to manage money in business with the
overhead and operation expenses.
THE RIGHT APPROACH
According to the modern approach the term financial management provides a conceptual and
analytical framework for financial decision making. That means, the finance function covers both
acquisition of funds as well as their allocation. This new approach views the term financial management
in a broader sense. It is viewed as an integral part of overall management.
The modern approach of financial Management can be divided into four major decisions as
function of finance:
The investment decision
The financial decision
The dividend policy decision
The funds requirement decision
INVESTMENT DECISIONS:
This is concerned with the allocation of capital. It has to show the funds can be invested in
assets which would yield benefit in future. This is a decision based on risk and uncertainty. Finance
Manager has to evaluate the investment in relation to their expected results and risk to determine
whether the investment is feasible or not.
FINANCIAL DECISIONS
This decision is concerned with the mobilization of finance for investment. The Finance Manager
has to take the decisions regarding the acquisition of finance. Whether entire capital required should be
raised in the form of equity capital or the amount should be borrowed totally or a balance should be
struck between equity and borrowed capital has to be decided. Even the timing of acquisition of capital
should also be perfectly made.
DIVIDEND DECISION
The dividend decision involves the determination of the percentage of profit earned by the
enterprise which is paid to the shareholders. The dividend payout ratio must be evaluated in the light of
the objective of maximizing shareholder’s wealth. Thus, the dividend decision has become a vital aspect
of financial decision.
CURRENT ASSETS MANAGEMENT
The Finance Manager should also manage the current assets to have liquidity in the business.
Investment of funds in current assets reduces the profitability of the firm. However the finance manager
should also equally look after the current financial needs of the firm to maintain optimum production.
6. While investing in current assets, he should see that proper trade off is maintained between the
profitability and liquidity.
2. Explain and evaluate the various bases for determining the proportions (weights) to be employed in
calculating the weighted average cost of capital.
Ans: Weighted average cost of capital
A firm uses various sources of finance to finance its projects. Each source of finance will be
having a specific cost. So in order to determine the overall cost of capital of the firm, the weighted
average cost of individual sources of finance should be determined with the weights being the
proportion of each type of capital used.
The Weighted Average Cost of Capital (WACC) is defined as the weighted average of the cost of
various sources of finance, weights being the book value or market values of each source of finance. If
ko represents the weighted average cost of capital or overall cost of capital then,
ko = wdkd + wpkp + wtkt + weke + wrkr
where,
ko = weighted average cost of capital
kd = cost of debt
kp = cost of preferred stock
kt = cost of term loan
ke = cost of equity
kr = cost of retained earnings.
wd = Proportion of total capital supplied by debt
wp = Proportion of total capital supplied by preferred stock
wt = Proportion of total capital supplied by term loan
we = Proportion of total capital supplied by external equity
wd = Proportion of total capital supplied by retained earnings
If debt and equity are the only sources of finance used by the firm, the Weighted Average Cost
of Capital can be calculated as follows:
WACC = Cost of equity x Proportion of equity in the financing mix + Cost of debt x Proportion of
debt in the financing mix i.e.
7. ko = wdkd + weke
or
ko = ke [E/(D+E)] + kd [D/(D+E)]
Where,
D = proportion of debt in the financing mix
E = proportion of equity in the financing mix
The weights used in determining the weighted average cost of capital of a firm are historical
weights. Historical weights are based on a firm’s existing capital structure. The use of these weights is
based on the assumption that the firm’s existing capital and therefore should be maintained in the
future. Two types of historical weights can be used – book value weights and market value weights.
1. Book Value Weights: The use of book value weights in calculating the firm’s weighted cost
of capital assumes that new financing’s will be raised using the same method the firm used for its
present capital structure. The weights are determined by dividing the book value of each capital
component by the sum of the book values of all the long-term capital sources.
2. Market Value Weights: Market value weights are determined by dividing the market value
of each source by the sum of the market values of all sources. The use of market value weights for
computing a firm’s weighted average cost of capital is more scientific than the use of book value weights
because the market values of the securities closely approximate the amount to be received from their
sale.
Importance of Weighted Average Cost of Capital
The weighted average cost of capital (overall cost of capital) is of utmost importance in capital
structure planning and in capital budgeting decisions.
In capital structure planning a company strives to achieve the optimal capital structure in
order to maximize the value of the firm. The optimal capital structure occurs at a point where the
overall cost of capital is minimum.
Since overall cost of capital is the minimum rate of return required by the investors, this rate
is used as the discount rate or the cut-off rate for evaluating the capital budgeting
1. Discuss the application of management accounting techniques for managerial decisions.
Ans: Applications of Management accounting in Managerial decisions:
Management accounting can be viewed as Management-oriented Accounting. Basically it is the
study of managerial aspect of financial accounting, "accounting in relation to management function". It
shows how the accounting function can be re-oriented so as to fit it within the framework of
management activity. The primary task of management accounting is, therefore, to redesign the entire
accounting system so that it may serve the operational needs of the firm. If furnishes definite
accounting information, past, present or future, which may be used as a basis for management action.
8. The financial data are so devised and systematically development that they become a unique tool for
management decision.
The Report of the Anglo-American Council of Productivity (1950) has also given a definition of
management accounting, which has been widely accepted. According to it, "Management accounting is
the presentation of accounting information in such a way as to assist the management in creation of
policy and the day to day operation of an undertaking". The reasoning added to this statement was, "the
technique of accounting is of extreme importance because it works in the most nearly universal medium
available for the expression of facts, so that facts of great diversity can be represented in the same
picture. It is not the production of these pictures that is a function of management but the use of them."
An analysis of the above definition shows that management needs information for better decisionmaking and effectiveness. The collection and presentation of such information come within the area of
management accounting. Thus, accounting information should be recorded and presented in the form
of reports at such frequent intervals, as the management may want. These reports present a systematic
review of past events as well as an analytical survey of current economic trends. Some of best tools and
techniques of management accounting and their respective applications are outlined below:
1st Tool : Analysis of Financial Statements
Analysis of financial statements is the main tool of management accounting. In this tool, we
collect four financial statements, one is profit and loss account, second is balance sheet, third is cash
flow statement and fourth and last is fund flow statement. After this, we calculate more than 30 ratios
and also analyze the financial statement by financial analysis, fund flow analysis and cash flow analysis.
Main aims of analysis of financial statements are following :
1. Profitability - its ability to earn income and sustain growth in both short-term and long-term.
A company's degree of profitability is usually based on the income statement, which reports on the
company's results of operations;
2. Solvency - its ability to pay its obligation to creditors and other third parties in the long-term;
3. Liquidity - its ability to maintain positive cash flow, while satisfying immediate obligations;
4. Stability- the firm's ability to remain in business in the long run, without having to sustain
significant losses in the conduct of its business. Assessing a company's stability requires the use of the
income statement and the balance sheet, as well as other financial and non-financial indicators.
2nd Tool : Budgetary Control
This is that tool of management accounting in which we make budgets for planning and control
of fund. All budgets are made with past historical accounting data and future expectations. After this
budgeted data is compared with actual recorded accounting data and performance is calculated on the
basis of deviation between actual and expected performance.
3rd Tool : Decision Accounting
There are lots of decision which businessman has to take on the basis of tools of management
accounting. One of management accounting tool is decision accounting. It is helpful to take main
decision which we can explain following ways :
9. a) To Buy or to construct any fixed asset
b) Do's or Don’ts to do any business activity
c) To choose best alternative
d) Calculation the price of product
4th Tool : Throughput accounting
Throughput Accounting (TA) is a dynamic, integrated, principle-based, and comprehensive
management accounting's tool that provides managers with decision support information for enterprise
optimization. Actually this is the extension of decision accounting. Throughput accounting is relatively
new in management accounting. It is an approach that identifies factors that limit an organization from
reaching its goal, and then focuses on simple measures that drive behavior in key areas towards
reaching organizational goals.
5th Tool : Management Information system (MIS)
Use of MIS tool provides information needed to manage organizations effectively . If we have to
understand MIS, we need to understand ERP, SCM, CRM, DSS and other computer techniques for
providing information with effective ways.
6th Tool : Financial Policy
Financial policy is that tool of management accounting which is needed to make good structure
of capital mix We decide the proportion of share capital and loans in capital structure. Financial and
operating leverages are also its sub-tools.
7th Tool : Working Capital Management
With this tool of management accounting, we manage short term assets and short term
liabilities. All cash management, debtor management and inventory management will include in working
capital management. We make also working capital cycle for knowing the firm's ability to convert its
resources into cash. If there is low time for conversion of raw material into sales and then cash from
debtor, it is good indication.
2. State the need for cost control. Indicate the use of control techniques in better cost management.
Ans: Cost Control and Its need:
Cost control, also known as cost management or cost containment, is a broad set of cost
accounting methods and management techniques with the common goal of improving business costefficiency by reducing costs, or at least restricting their rate of growth. Businesses use cost control
methods to monitor, evaluate, and ultimately enhance the efficiency of specific areas, such as
departments, divisions, or product lines, within their operations.
10. During the 1990s cost control initiatives received paramount attention from corporate America.
Often taking the form of corporate restructuring, divestment of peripheral activities, mass layoffs, or
outsourcing, cost control strategies were seen as necessary to preserver corporate profits and to
maintain gain competitive advantage. The objective was often to be the low-cost producer in a given
industry, which would typically allow the company to take a greater profit per unit of sales than its
competitors at a given price level.
Some cost control proponents believe that such strategic cost-cutting must be planned carefully,
as not all cost reduction techniques yield the same benefits. In a notable late 1990s example, chief
executive Albert J. Dunlap, nicknamed "Chainsaw Al" because of his penchant for deep cost cutting at
the companies he headed, failed to restore the ailing small appliance maker Sunbeam Corporation to
profitability despite his drastic cost reduction tactics. Dunlap lay off thousands of workers and sold off
business units, but made little contribution to Sunbeam's competitive position or share price in his two
years as CEO. Consequently, in 1998 Sunbeam's board fired Dunlap, having lost confidence in his "onetrick" approach to management.
Use of Cost Control Techniques
A complex business requires frequent information about operations in order to plan for the
future, to control present activities, and to evaluate the past performance of managers, employees, and
related business segments. To be successful, management guides the activities of its people in the
operations of the business according to pre-established goals and objectives. Management's guidance
takes two forms of control:
(1) the management and supervision of behavior, and
(2) the evaluation of performance.
Behavioral management deals with the attitudes and actions of employees. While employee
behavior ultimately impacts on success, behavioral management involves certain issues and
assumptions not applicable to accounting's control function. On the other hand, performance evaluation
measures outcomes of employee's actions by comparing the actual results of business outcomes to
predetermined standards of success. In this way management identifies the strengths it needs to
maximize, and the weaknesses it seeks to rectify. This process of evaluation and remedy is called cost
control.
Cost control is a continuous process that begins with the proposed annual budget. The budget
helps:
(1) to organize and coordinate production, and the selling, distribution, service, and
administrative functions; and
(2) to take maximum advantage of available opportunities. As the fiscal year progresses,
management compares actual results with those projected in the budget and incorporates into the new
plan the lessons learned from its evaluation of current operations.
11. Control refers to management's effort to influence the actions of individuals who are
responsible for performing tasks, incurring costs, and generating revenues. Management is a twophased process: planning refers to the way that management plans and wants people to perform, while
control refers to the procedures employed to determine whether actual performance complies with
these plans. Through the budget process and accounting control, management establishes overall
company objectives, defines the centers of responsibility, and determines specific objectives for each
responsibility center, and designs procedures and standards for reporting and evaluation.
A budget segments the business into its components or centers where the responsible party
initiates and controls action. Responsibility centers represent applicable organizational units, functions,
departments, and divisions. Generally a single individual heads the responsibility center exercising
substantial, if not complete, control over the activities of people or processes within the center and
controlling the results of their activity. Cost centers are accountable only for expenses, that is, they do
not generate revenue. Examples include accounting departments, human resources departments, and
similar areas of the business that provide internal services. Profit centers accept responsibility for both
revenue and expenses. For example, a product line or an autonomous business unit might be considered
profit centers. If the profit center has its own assets, it may also be considered an investment center, for
which returns on investment can be determined. The use of responsibility centers allows management
to design control reports to pinpoint accountability, thus aiding in profit planning.
A budget also sets standards to indicate the level of activity expected from each responsible
person or decision unit, and the amount of resources that a responsible party should use in achieving
that level of activity. A budget establishes the responsibility center, delegates the concomitant
responsibilities, and determines the decision points within an organization.
The planning process provides for two types of control mechanisms:
1. Feed forward: providing a basis for control at the point of action (the decision point); and
2. Feedback: providing a basis for measuring the effectiveness of control after implementation.
Management's role is to feed forward a futuristic vision of where the company is going and how
it is to get there, and to make clear decisions coordinating and directing employee activities.
Management also oversees the development of procedures to collect, record, and evaluate
feedback. Therefore, effective management controls results from leading people by force of personality
and through persuasion; providing and maintaining proper training, planning, and resources; and
improving quality and results through evaluation and feedback.
1. State the evolution and present status of direct taxes as provided in the Indian
constitution.
Ans: Evolution of taxation
The history of taxation dates back to time immemorial and it is not a recent development by any
account. A thorough research on the history of taxation system shows that taxes were levied on either
on the sale and purchase of merchandise or livestock.
12. Further, the history of taxation suggests that the process of levying and the manner of tax
collection were unorganized. But it suggests that all historical leaders and head countrymen collected
taxes to run its authority. In other words taxes on income, sale, purchase and properties were collected
to run the ruling Government machineries. Further, these taxes were collected to meet their military
and civil expenditure and also to meet the common needs of the subjects like maintenance of roads,
drainage system, government buildings, administration of justice and other functions of the region. day
India tax machinery is very much based on that laid down foundation.
Although, there were no homogeneous tax rate structures but it depended on the production
capacity and commodity of that particular country and/or region. Moreover, the tax rates and quantum
varied according to the annual production. These taxes were collected in cash or in kind and it entirely
depended on the type of commodity or service on which it was levied upon. For example, there was a
very common practice of selling food crops and cash crops to government machineries against no
money. The history of taxation suggests these were done to store government buffer stocks to meet
emergencies. Taxes were levied on all classes of citizens, like actors, dancers, singers and even dancing
girls. Taxes were paid in the form of gold-coins, cattle, grains, raw-materials and even by rendering
personal service.
In India, the tradition of taxation has been in force from ancient times. It finds its references in
many ancient books like 'Manu Smriti' and 'Arthasastra'. There was a perfect admixture of direct taxes
with indirect taxes and they were varied in nature. India's history of taxation suggests existence of a
large and composite taxable population. With the advent of the moguls in India the country witnessed a
sea of change in the taxation system of India. Although, they also practiced the same norm of taxation
but it was more homogeneous in structure and collection. The period of British rule in India witnessed
some remarkable change in the whole taxation system of India. Although, it was highly in favor of the
British government and its exchequer but it incorporated modern and scientific method of taxation tools
and systems. In 1922, the country witnessed a paradigm shift in the overall Indian taxation system.
Setting up of administrative system and taxation system was first done in the history of taxation system
in India. The period thereafter witnessed rapid growth and modernization of the Indian taxation system
and the present.
Tax status as per constitution of India
Constitution is the foundation and source of powers to legislate all laws in India. Parliament, as
well as State Legislatures gets the power to legislate various laws from the Constitution only and
therefore every law has to be within the vires of the Constitution.
Talking about the taxation laws and the interpretation of taxation laws, every lawyer or a tax
professional practicing taxation laws must understand the basic provisions of Constitution relating to
taxation including the powers of Parliament and State Legislatures to legislate regarding levy and
collection of tax, the restrictions imposed by our Constitution on such powers, entries concerning
taxation in Central List i.e. List-1 and State List i.e. List-2 of Seventh Schedule to Constitution of India.
All laws and executive actions are subordinate to the Constitution. To form clear understanding
of the basic concepts relating to taxation laws one must understand the relevant provisions of the
Constitution, as the power to levy and collect tax by State Governments or Union Government comes
from the Constitution only.
13. One thing must be kept in mind that there is always an object behind every law and that object
ultimately exists to achieve the objects enumerated in the Preamble of our Constitution, which runs as
under: “While interpreting every law one has to keep in mind the object behind the law, if any
provision of the law or any administrative action or any interpretation of the law defeats the object of
such law for which it is being legislated and consequently is not in accordance with the Constitution
then it is illegal, void and ultra vires of the Constitution.”
Therefore it is important to understand the powers and scheme of taxation under Constitution
before understanding the taxation laws. Whenever I try to understand any complicated provision of law,
I refer to the object of the law for which it has been legislated and also the power of the Parliament or
State legislature under the Constitution to legislate such law for better understanding of the subject.
For example State VAT Acts have been legislated by State Legislatures under Entry 54 of List-II of
the Seventh Schedule to the Constitution, which runs as under: “Tax on sale or purchase of goods other
than newspapers except tax on interstate sale or purchase.”
Hence every law legislated under Entry 54 of State List must levy tax only on the sale or
purchase of goods other than newspapers within the State Jurisdiction. If a State law legislated under
entry 54 levies tax on the inter-state sale or purchase of goods, it has to be struck down as ultra vires of
the Constitution. The roots of every law in India lies in the Constitution, therefore understanding the
provisions of Constitution is foremost to have clear understanding of any law.
Now, Let us go through some of the relevant provisions of our Constitution relating to taxation:
Article 246(1) of Constitution of India states that Parliament has exclusive powers to make laws
with respect to any of matters enumerated in List I in Seventh Schedule to Constitution(i.e. Union list).
Article 246(3) provides that State Government has exclusive powers to make laws for State with respect
to any matter enumerated in List II of Seventh Schedule to Constitution(i.e. State List).
Parliament has exclusive powers to make laws in respect of matters given in Union List and State
Government has the exclusive jurisdiction to legislate on the matters containing in State List.
There is yet another list i.e. List III (called concurrent list) in the Seventh Schedule to the
Constitution. In respect of the matters contained in List III both the Central Government and State
Governments can exercise powers to legislate. In case of Union Territories Union Government can make
laws in respect of all the entries in all the three lists.
List III of Seventh Schedule(i.e. Concurrent list) includes entries like Criminal law and Procedure,
Trust and Trustees, Civil Procedures, economic and social planning, trade unions, charitable institutions,
price control factories, etc.
In case there is a conflict between the laws legislated by State Government and Central
Government in respect of entries contained in Concurrent list, law made by Union Government prevails.
However there is one exception to this rule, if law made by State contains any provision
repugnant to earlier law made by Parliament, law made by State Government prevails, if it has received
assent of President. Even in such cases, Parliament can make fresh law and amend, repeal or vary law
made by State.
14. 2. State the provisions of the Income Tax Act with regard to tax deducted at source.
Ans: Tax Deducted at Source (TDS) Provisions:
TDS (Tax Deducted at Source on payment of interest (or any other service fees) to non Banking
financial Companies and Public Financial Institutions.
Non Banking Financial Institution: A Non Banking financial Company is a company registered
under Companies Act, 1956 engaged in the business of loans and advances, acquisition of shares/
stocks/bonds/debentures/securities issued by Government or Local authority or other marketable
securities of a like nature, leasing, hire – purchase, insurance business, chit business, but does not
include any institution whose principal business is that of agriculture activity, industrial activity,
purchase or sale of any goods (other than securities) or providing any service and sale / purchase/
construction of immovable property.
Public Financial Institution: Section 4A of Companies Act, 1956 – Public financial Institutions
1. Each of the financial institutions specified in this sub-section shall be regarded, for the
purposes of this Act, as a public financial institution namelyi. the industrial Credit and Investment Corporation of India Limited, a company formed and
registered under the India Companies Act, 1913;
ii. the Industrial Finance Corporation of India, established under section 3 of the Industrial
Finance Corporation Act, 1948;
iii. the Industrial Development Bank of India, established under section 3 of Life Insurance
Corporation Act, 1956;
iv. the Unit Trust of India, established under section 3 of The Unit Trust of India Act, 1963;
v. the Infrastructure Development Finance Company Limited, a company formed and registered
under this Act.
vi. the securitization company or reconstruction company who has obtained a certificate of
registration under sub-section (4) of section 3 of the Securitisation and Reconstruction of Financial
Assets and Enforcement of Security Interest Act, 2002.
2. Subject to the provisions of sub-section (1) the Central Government may, by notification in
the Official Gazette, specify such other institution as it may think fit to be a public financial institution:
Provided that no institution shall be so specified unlessi. It has been established or constituted by or under any Central Act, or
ii. Not less than fifty – one percent, of the paid – up share capital of such institution is held or
controlled by the Central Government.
15. From the above, we can conclude that Non Banking financial Companies and Public financial
Institution both are not same.
Tax Deducted at source on Interest: In accordance with the Section 2 (28A) of Income Tax Act, 1961
Interest means interest payable in any manner in respect of any money borrowed or debt
incurred (including a deposit, claims or other similar rights or obligation) and includes any service fee or
other charge in respect of the money borrowed or debt incurred or in respect of any credit facility which
has not been utilized.
Interpretation of the above definition
From the above definition it is being clarified that Interest and loan processing fee are same in
the eyes of law (Income Tax Act, 1961). Hence, TDS compliances on both must be same.
If TDS is required to be deducted by any entity on interest then it must be deducted on loan
processing fee or any other service fee.
Section 194A of Income Tax Act, 1961 - TDS on Interest (other than interest on securities)
Section 194A explains that Any person, not being an individual or a Hindu Undivided Family who
is responsible for paying to a resident any income by way of interest, other than interest on securities, is
required to deduct income tax thereon at the rate of 10% at the time of credit of such income to the
account of payee, or interest payable account or suspense account or at the time of payment thereof, in
cash or by issue of a cheque or draft or by any other mode, whichever is earlier,
However this section also state some cases where provisions of this section are not applicable
which includes:
TDS is not required to be deducted where interest is credited or paid to any banking company,
co-operative societies engaged in banking business, public financial institutions, the Life Insurance
Corporation, the unit Trust of India, a company or a co – operative society carrying on the business of
insurance, or notified institution. But this section does not provide any exemption from TDS to Non
Banking financial companies.
Conclusion: TDS is not required to be deducted on payment of interest (or any other service
fee) if the payment is made to some Public financial Institutions, however need to comply with the TDS
provisions under section 194A if payment is made to any Non – Banking financial Companies.
Points to be remembered while Auditing
a. No difference is made between interest and any loan processing fee or any other related
service fee under Income Tax act,1961, hence TDS Compliance on their payments must be checked
under Section 194A – TDS on Interest ( other than interest on securities). Refer Section 2(38) as
explained above.
b. Auditors must check the status of the company or institution form whom the loan is taken
before applying the provisions regarding TDS under section 194A of Income Tax Act,1961 as exemption
is provided to only Public financial Institutions and not to Non Banking financial Companies.