Internship Report Atlas Honda Limited

Atlas Honda Limited 2014
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COMSATS Institute of Information Technology, Lahore

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Table of Contents
Acknowledgement ....................................................................................6
Dedication ..................................................................................................7
Executive Summary..................................................................................8
Research Methodology ............................................................................9
Introduction to Bike Industry ................................................................10
Introduction to Atlas Group...................................................................11
Atlas Group........................................................................................................................ 11
Atlas Honda Limited...............................................................................12
Karachi Plant ..................................................................................................................... 13
Sheikhupura Plant ............................................................................................................ 13
Organizational chart:-.............................................................................14
Geographical presence:-........................................................................15
Critical performance measures 2014:-.................................................16
Vision and Mission:-...............................................................................17
Vision.................................................................................................................................. 17
Mission............................................................................................................................... 17
Quality Policy..................................................................................................................... 17
Brand:-......................................................................................................18
What is Honda? ................................................................................................................ 18
Honda’s Driving Force ..................................................................................................... 18
Honda’s Goal in Branding ............................................................................................... 18
Global Brand Slogan........................................................................................................ 18
Code of Conduct:-...................................................................................19
Standard of Conduct ........................................................................................................ 19
Obeying the Law............................................................................................................... 19
Human Capital .................................................................................................................. 19
Consumer .......................................................................................................................... 20
Shareholders ..................................................................................................................... 20
Business Partners ............................................................................................................ 20
Public Activities................................................................................................................. 21

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The Environment .............................................................................................................. 21
Innovation .......................................................................................................................... 21
Competition........................................................................................................................ 21
Business Integrity ............................................................................................................. 21
Conflicts of Interests......................................................................................................... 22
Milestones:-..............................................................................................22
Strategic Goals:-......................................................................................25
Customers.......................................................................................................................... 25
Quality ................................................................................................................................ 25
Local Manufacturing ......................................................................................................... 25
Technology........................................................................................................................ 25
Shareholders ..................................................................................................................... 25
Employees ......................................................................................................................... 25
Corporate Citizens............................................................................................................ 26
Awards and Achievements:-.................................................................26
Four P’s of Marketing:-...........................................................................28
Products ............................................................................................................................. 28
Pricing:- .............................................................................................................................. 36
Place:- ................................................................................................................................ 36
Promotion:- ........................................................................................................................ 37
SWOT Analysis:-.....................................................................................38
Strengths............................................................................................................................ 38
Weaknesses...................................................................................................................... 39
Opportunities..................................................................................................................... 39
Threats ............................................................................................................................... 39
Financial Statement Analysis:-.............................................................40
Current Ratio from 2009 to 2014 ................................................................................... 40
Quick Ratio from 2009 to 2014....................................................................................... 41
Inventory Turnover Ratio from 2009 to 2014 ............................................................... 42
Average Collection Period from 2009 to 2014 ............................................................. 43
Total Assert Turnover from 2009 to 2014..................................................................... 44
Debt ratio from 2009 to 2014 .......................................................................................... 45

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Time interest earned ratio from 2009 to 2014.............................................................. 46
Gross Profit Margin from 2009 to 2014......................................................................... 47
Operating Profit from 2009 to 2014 ............................................................................... 48
Net profit margin from 2009 to 2014.............................................................................. 49
Earnings per Share from 2009 to 2014......................................................................... 50
Return on Assert from 2009 to 2014 ............................................................................. 51
Vertical Analysis of balance sheet from 2009 to 2014:-....................52
Horizontal Analysis of balance sheet from 2009 to 2014:-...............54
Department understudy during internship:-.......................................56
Petty cash Section:-................................................................................57
Software’s used .............................................................................................................. 57
Passing of entries .......................................................................................................... 57
Manual recording.............................................................................................................. 58
Bank reconciliation ........................................................................................................... 58
Steps of bank reconciliation............................................................................................ 59
Taxation Section:-...................................................................................60
Software’s used ................................................................................................................ 60
Linkage to other sections ................................................................................................ 60
Process of tax payment (Withholding income tax)...................................................... 61
Exceptions certificates ..................................................................................................... 62
Sale tax:-...................................................................................................62
Process of sales tax deductions (VAT system) ........................................................... 62
Input (purchases).............................................................................................................. 63
Output (Sales) ................................................................................................................... 63
Adjustments in input and output..................................................................................... 63
Differences between the conventional sales tax system and VAT system ............. 63
Costing Section:- ....................................................................................64
Software used in costing ................................................................................................. 64
Linkage of costing to other departments....................................................................... 64
Working of costing section .............................................................................................. 64
Stock and its working ....................................................................................................... 64
Stores ................................................................................................................................. 66

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Process of stores.............................................................................................................. 66
Costing:-............................................................................................................................. 67
Working of costing............................................................................................................ 67
Process .............................................................................................................................. 68
Vendor Payment section:-.....................................................................68
Software’s used ................................................................................................................ 68
Working of the vendor payment section:- ..................................................................... 69
Linkage of vendor payment to other departments....................................................... 70
Payroll:-....................................................................................................72
Software’s used ................................................................................................................ 72
Linkage of payroll to other departments ....................................................................... 72
Working of the payroll section ........................................................................................ 72
Things managed by payroll............................................................................................. 73
Payroll process.................................................................................................................. 73
Conclusions and Recommendations:-................................................75
Conclusion:-....................................................................................................................... 75
Recommendations:- ......................................................................................................... 76
References:-.............................................................................................77
Appendix:-................................................................................................78
Bank payment vouchar:- ................................................................................................. 78
Cash payment vochar:-.................................................................................................... 79
Income tax payment Challan:-........................................................................................ 80
Sales tax computation:- ................................................................................................... 81
Exemption certificates:- ................................................................................................... 82
Certificate of collection or deduction of tax:- ................................................................ 83

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Acknowledgement
Before saying anything I want to thank Allah almighty for helping me a lot during my
internship, and for giving me the valor to remain enthusiastic during the whole
internship.
Apart from that a special thanks to Mr. Abdullah Khalid (Assistant Manager petty
cash), Mr. Ahmad (Assistant Manager Vendor payment), Mr. Waqar (Executive
Manager Vendor Payment), and Mr. Ather Naseer (Assistant manager payroll), Mr.
Shehbaz Ahmad (Assistant Manager taxation), Mr. Saif ullah (Assistant Manager
Costing) and the all other employee of Atlas Honda for their guidance during the
period of my internship in Atlas Honda.
At last I want to thank Sir Imran ur Rehman for his guidance.

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Dedication
I want to dedicate it to my beloved Hazrat Mohammad (SAW) and my beloved
parents because without them I would not be able to do anything.

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Executive Summary
Atlas Honda LTD is a part of a leading group of Pakistan and currently Atlas Honda
is the market leader of the bike industry where it stands at the top of the list.
The main purpose of my internship was to see the differences between the
education and the actual work performed at Atlas Honda. During the Six weeks of
my internship I have learned a lot of things which cannot be learned during our
education. During this time period I have mainly worked in the finance department of
Atlas Honda and I have putted my all efforts to it. I have seen how the different
sections of finance department are interlinked with each other, how the finance
department is interlinked with the other departments such as marketing and human
resource department and other technical departments of the Atlas Honda, and I have
studies and seen the importance of finance department in any organization.
How the Atlas Honda is strict to its vision and mission the importance of it to keep
the motivational level up to the mark which makes them able to maintain the market
leader position, and how they are utilizing there code of ethics and 5s dealer policy
to reach their customers and to apply the concepts of customer relationship
management.

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Research Methodology
The data used for the completion of this report is obtained from both the primary
resources of data and the secondary resources of the data.
Primary resources:-
The main primary resources through which I have collected the date are the
followings
 Personal observations
 Interviews with the Heads of different department
 Meetings with the Managers, Assistant managers and Workers
Secondary resources:-
Various secondary data was collected from following resources
 Company website
 Company reports and memos
 Articles
 Other internet resources
 Financial report

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Introduction to Bike Industry
Statistic of last 12 years shows an increase of 15% in the motorbike industry of
Pakistan. In the past when Atlas Honda Limited was in the early stages it was just
selling 100000 bike per year and now a days the major five local producers except
Atlas Honda Limited are selling more than 100000 bikes with almost similar
technology.
According to some auto bike industry specialists in the upcoming year’s new
technologies will be introduced. And the technology will mainly introduced by the
Japanese companies such as Honda, Suzuki, Yamaha and there foot path will be
followed by the Chinese companies. Similar type of trend can be seen in India where
there local produces are spending a lot on the research and development to produce
latest bikes to keep themselves in the competition and they are doing it on their own
without any outsider collaborations. Pakistani bike industry has a very clear future
can in future some new companies will join and the competition will increase.
The Pakistani motor bike industry can be divided into three segments, the Needy
having low income, the needy having appropriate income and the needy having the
high income.
The buyers with small income are 60%. The buyers with the appropriate income are
38%, go for Japanese bikes starting from 70000 rupee and 2% buying are high end
and for leisure. That is why the 84% selling bike is 70cc, 11% is 125cc and
unfortunate only 5% is 100cc.
(Mehmood, N. (2013, April 1). Pakistan motorcycle market. Mobile World, 35-35)

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Introduction to Atlas Group
Atlas Group
The Atlas group is known for dealing in a lot of sectors such as engineering, trading,
and financial services. The Atlas group was founded in 1962 with the foundation of
its first company known as Shirazi investments (Private) Limited. Now a day it has
become as group of fifteen companies, of which six are the public limited companies.
The Atlas group is the one who has promoted not only the sense of corporate
governance but also introduced a lot of modern technologies.
Following companies are working under the name of Atlas group in Pakistan.
Atlas group Timeline
 1962 Shirazi investments
 1963 Atlas Honda
 1966 Atlas battery
 1973 Shirazi trading
 1980 Atlas insurance
 1981 Atlas engineering
 1992 Honda Atlas cars
 1997 Honda Atlas Power Product
 2002 Atlas Asset Management
 2007 Atlas Power
 2007 Atlas World Wide
 2008 Atlas Venture
 2011 Atlas Autos
 2012 Atlas Hitec
 2012 Atlas Metals

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Atlas Honda Limited
Atlas Honda Limited is currently operating under a joint venture between the Atlas
Group and the Honda motors. The company was firstly created by the acquisition of
Panjdarya motors by the Atlas Autos Limited. Atlas Honda Limited was also
operating In the Bangladesh before the Pak indo war 1971. After the separation
Atlas Honda Limited stopped its operations in Bangladesh. Currently Atlas Honda
Limited is the market leader in the Pakistan motor bike industry due to his quality and
customers relationship management.
Atlas Honda Limited is known for undertaking the capabilities of local production to
higher economical levels. Currently Atlas Honda Limited has two main factories
located in Sheikhupura and Karachi, to produce high quality bikes in Pakistan Atlas
Honda Limited has a well-established research and development department, which
is keep on expanding. Atlas has succeeded to complete twelve Joint Venture,
Technical Assistance Treaties between local dealers and foreign producers for the
transmission of technology. Apart from that Atlas has directly completed Nine Joint
Venture, Technical Assistance Treaties other than Honda.
Atlas Honda Limited is determined to revolutionize companies operation by research
and theory. The style of management, classifications and procedures are altered
according to the current market trends. Atlas Honda Limited always tries and prefer
to make decisions by allowing all types of employee’s to take part in the decision
making process. Many involvement programs such as AlaMayar, (launched in 1985),
are encouraged to let positive assertiveness and teamwork. The company launches
training and development programs to motivate employees to build themselves and
incorporate their motivation towards the Atlas Honda Limited.
Atlas Honda limited is playing the leading role in the distribution system in the
Pakistani motor bike industry. It has more than 1600 deals all around the country to
fulfill the demand of bikes in the market.

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KarachiPlant
The first plant of atlas Honda limited is located in the capital of Sindh, Karachi. It is
located at the F-36, Estate Avenue Karachi. The plant is spread over an area around
five Acres. In the start the production was just only seven bikes per day but
according to current statistics it is producing around 300 bikes of only CD 70 version
per day.
SheikhupuraPlant
The second and the main plant of Atlas Honda Limited is located in the city of Punjab
known as Sheikhupura. This plant was founded in 1981 and currently it is spread
over around twenty seven Acres. It is currently producing more than 2000 bikes per
day and all models such as CD 70, CD Dream, Pridor, CG 125 and CG 125 Deluxe,
CG Dream.
Exports
Atlas Honda Limited is also exporting its bikes in the Bangladesh, Sri-lanka and
Afghanistan bike market.
RegionalOffice
Atlas Honda Limited currently has four regional offices in Pakistan.
 Lahore
 Rawalpindi
 Multan
 Rahim Yar Khan

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Organizational chart:-

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Geographical presence:-

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Critical performance measures 2014:-

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Vision and Mission:-
Vision
To be a Market leader in the motorcycle industry, emerging as a global competitive
center of production and exports.
Mission
A dynamic growth oriented company through market leadership, excellence in quality
and service and maximizing export, ensuring attractive returns to equity holders,
rewarding associates according to their ability and performance, fostering a network
of engineers and researchers ensuing unique contribution to the development of the
industry, customer satisfaction and protection of the environment by producing
emission friendly green products as a good corporate citizen fulfilling its social
responsibilities in all respects.
Quality Policy
 Commitment to provide high quality motorcycles & parts
 Right work in first attempt and on time
 Maintain and continuously improve quality
 Training of manpower and acquisition of latest technology
 Safe, clean and healthy environment
 Market leadership and prosperity for all

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Brand:-
What is Honda?
Honda is a company which predicts the dreams of the people and by fulfilling those
dreams it becomes a reason of joy. The beliefs, unique culture, quest of the
challenges are the things which fulfill the dreams of people and different type of
products act as the base of Honda Corporation. And Honda will keep fulfilling the
dreams of the people.
Honda’s Driving Force
Honda acts as a driving force for the people around the globe. People see it as a
driving force to pursue there dreams and to keep them self ahead of the world. The
image of Honda in the mind of the people and the outlook of Honda will always act
as a driving force of Honda.
Honda’s Goal in Branding
The main goal of Honda is to create a brand which is just according to the needs,
wants and demands of the people.
Global Brand Slogan
Everyone in the world has a dream, vision, some aims or doings which create an
image in there life. When Honda pursues a vision, Honda feels empower. This power
acts as a combining force and connects us to those who have the same dream. It
gives the power to fight challenges and inspires to stretch the joy. Finally, the power
generated through a dream is a motivating force, competent of creating ground-
breaking ideas. Honda motivates every associate to go for their dreams. That’s why
this can be said that Honda is built on a dream. In the current century, the
supremacy of Honda’s dreams and visions will keep on leading new insights and
technologies in auto-mobiles, motorbikes, power generation and other fields of
movement that are just starting to be imagined. Dream is the real meaning of Honda.

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The dream of our acquaintances, consumers, and followers make Honda what it is
now a day. Our highly unique ideas and unique philosophy have amazed the world in
many occasions. Honda will continue on dreaming to realize what will we come up
next? Honda will keep on making stimulating products and it will keep on realizing
people’s dreams and wants. Our slogan For Honda to remain Honda, and for
everyone to realize their aspirations, we must believe in “The Power of Dreams”.
Code of Conduct:-
Standard of Conduct
Atlas Honda Limited always works with honesty, truthfulness and sincerity and
always respects the human rights and wellbeing of the employees. It respects the
legal interests of everyone with whom it is in a relationship. It has formed its authority
framework and processes, which are associated to the dogmatic necessities.
Every person at Honda is a part of this authority system and is required to stick to
the policies and procedures.
Obeying the Law
Atlas Honda Limited is highly committed to obey the laws and regulations of
Pakistan.
Human Capital
Atlas Honda Limited is dedicated to make a working atmosphere where there is trust
and respect, and where every single person feels responsible for the performance
and name of the Company. It follows the rules of equal employment opportunity to
recruit employs, promotes and offers career development to employee’s on the basis
of merit, skills, ability and qualification. It is dedicated to safe and vigorous working
conditions for all workers. It never uses nor supports the use of force and child labor.
It is dedicated to work with employee’s to expand and improve each individual’s skills
and capabilities, and making an atmosphere favorable for educational growth and
career development.

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It respects the self-respect of the human being and the rights of employee’s. It is
dedicated to make an organizational atmosphere in which persons are equally
treated, motivated to donate, raise and develop themselves and help others in their
performance.
It motivates the perception of autonomy and living within one’s own way, saving for
up coming future and donating for good reason.
Consumer
Atlas Honda limited always tries to find ways to provide real products and service
which keep on providing the vale to the customers against the money paid by them.
Products are services are conveyed properly by Atlas Honda limited through different
ways of advertisement.
It always tries to provide a quality product according to the perception customers
about the Honda.
It runs its operations in such a way that it produces those products and services
which are safe in use and can never cause any health of safety issue.
Shareholders
Atlas Honda limited carry its operations according to the principles of corporate
governance and it is committed to provide right information of financial situation and
information of its different activities which can effect the shareholders.
Business Partners
Atlas Honda Limited is always motivated towards the building of the relationship
which the vendors, consumers and other business partners. During any business
transaction it always tries to follow and stick to its core principles

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Public Activities
Atlas Honda Limited promotes and defends its lawful business welfare. It always
cooperates with Government and organizations, openly and through channels such
as trade relations.
It never supports any political parties and never contributes funds in those groups
whose sole purposes are to promote any party interests.
The Environment
Atlas Honda Limited is always committed to make improvements in its processes
regarding the environment and always try to make business run for a longer time. It
always works with those who promote environmental concerns.
Innovation
Atlas Honda Limited always tries to make innovated products to meet the wants of
the consumers. It keeps on working on the aspects of research and development
and use high quality standers.
Competition
Atlas Honda Limited always plays a fair game and fights the competition in legal
ways. Atlas Honda Limited keeps on motivating itself and its employee’s to run
business in accordance to the fair competition with follows the rules and regulations.
Business Integrity
Atlas Honda Limited forbids illegal activities such as bribes for the gain of business
advantage or any other type of gain in the form of business and finance. Gifts and
other type of payments are forbidden which may be considered as a type of bribe.
Any type of demand of offer in case of bribe is advised to be rejects without any
second thought.

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Its bookkeeping records and other documents must precisely describe and reveal
the nature of the transactions. No unnamed account, fund or asset will be
maintained.
Conflicts of Interests
The employees of Atlas Honda Limited are expected to avoid personal actions and
financial interests, which could clash with their duties to the company. They are
always told not to use position power for the personal gains.
Milestones:-
The company is known for the manufacturing of motorbikes and different auto parts.
Since its commencement the company has practiced an extraordinary growth in its
operations from a small production unit to the leading motorcycle producer of the
Pakistan. Following is the sequential order of the major events which held in the
history of the company.
2013 Atlas Honda Limited got the Best Corporate Report Award of ‘’2012’’
2013 Atlas Honda Limited got its Environmental Report ranked best in ACCA
WWF Awards 2012
2012 Atlas Honda Limited Launched its New Model Honda Pridor.
2012 Atlas Honda Limited transformed its complete motorbike line up to EURO
II technology.
2010 Atlas Honda Limited Launched a new Model “CG 125 Deluxe Euro II”
2010 Atlas Honda Limited got the SAFA Award for Best Corporate governance
in annual report of 2008
2010 Got the best Corporate report award by Joint Committee of ICAP and
ICMAP.
2009 Atlas Honda Limited got HRM Excellence Award 2009
2009 Atlas Honda Limited got National CSR Award 2009

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2009 Atlas Honda Limited Launched New Model of “CD 100 Euro II”
2009 ISO 14001-2004 Environment Certificate acquisition
2008 Atlas Honda Limited established Delivery Control Center at Karachi Plant.
2007 Atlas Honda Limited successfully incorporated SAP ERP to its business
all over Pakistan.
2006 Atlas Honda Limited got top 25 company award by KSE.
2006 Atlas Honda Limited incorporated DCC at Sheikhupura Plant.
2006 Atlas Honda Limited annual Production reached to 360000 units
2005 Atlas Honda Limited crosses the 250000 units bridge by selling 287184
units.
2004 Atlas Honda Limited got top 25 company award by KSE.
2003 Atlas Honda Limited got best Corporate Report award by joint committee
of ICAP and ICMAP.
2002 Deletion level reached to 87% and 80% for CD70 & CG125 respectively
2002 Atlas Honda Limited incorporated Research and Development Wing.
2002 Atlas Honda Limited introduced Gratuity Scheme for staff.
2002 Atlas Honda Limited got Best Corporate Report award by joint committee
of ICAP and ICMAP.
2001 Atlas Honda Limited launched the concept of 5S dealership.
2000 Atlas Honda Limited Investment in Crankshaft Project
1999 ISO 9002 certification for both factories
1998 Atlas Honda Limited New CD 70 and CG 125 models are launched.
1995 Export Agreement signed with Honda Motor Company Limited Japan.
1995 Atlas Honda Limited makes its first exports to Bangladesh, Nepal, Sri
Lanka, Middle East and Central Asia.
1994 Mr. Kawamoto President of Honda Motor Company Limited visited AHL.
1992 Change of name to Atlas Honda Limited (AHL)

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1991 Atlas Honda Limited Inauguration of CG125 Engine Project at
Sheikhupura Factory.
1989 Atlas Honda Limited exported built up motorcycles to Nepal.
1988 Merger of Panjdarya Limited into Atlas Autos Limited.
1988 Atlas Honda Limited production capacity expansion III.
1988 Signing of Joint Venture agreement with Honda Motor Company Limited.
1987 Atlas Honda Limited Inauguration of CD70 Engine Project at Karachi
Factory
1981 Commercial Production started at Panjdarya Limited
1981 Production capacity expansion II
1979 Incorporation of Panjdarya Limited as Joint Venture with Honda Motor
Company Limited
1976 Production capacity expansion I
1965 Public offering of Shares
1964 Commercial Production started
1962 Technical Assistance Agreement signed with Honda Motor Company
Limited Japan
1962 Incorporation of Atlas Autos Limited

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Strategic Goals:-
Customers
Our customers are the reason and the source of our business. It is our joint aim with
our dealers to ensure that our customers enjoy the highest level of satisfaction from
use of Honda Motorcycles.
Quality
Ensure that our products and services meet the set standards of excellence.
Local Manufacturing
Be the industry leader in indigenization of motorcycles parts.
Technology
Develop and maintain distinct business advantages through continuous induction of
improved hard and soft technologies.
Shareholders
Ensure health and viability of business and thus safeguarding shareholders interest
by maximizing profit.
Employees
To enhance and continuously up-date each member’s capabilities and education and
to provide an environment which encourages practical expression of the individuals
potential in goal directed team efforts and compensate them attractively according to
their abilities and performance.

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Corporate Citizens
Comply with all government laws and regulation, to maintain high standard of ethics
in all operations and to act as a responsible members of the community.
Awards and Achievements:-
SAFA Award Compliance with Corporate Governance and comprehensive
disclosures in financial statements is one of the prime objectives of Atlas Honda
Limited. This effort was recognized internationally by professional body, South Asian
Federation of Accountants (SAFA) and received the award for best presented
accounts and corporate governance disclosures for its annual report 2008.
ICAP / ICMAP Joint Committee Award the Company was once again encouraged by
another prestigious national award upon receiving Best Corporate Report Award
2008 in Engineering Sector by Joint Committee of Institute of Chartered Accountants
of Pakistan (ICAP) and Institute of Cost & Management Accountants of Pakistan
(ICMAP).

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National CSR Award 2009 Corporate Social Responsibility (CSR) activities of Atlas
Honda Limited got a boost from the recognition received through the 4th National
CSR Award. This recognition will be an impetuous for the Company to further
improve its effectiveness in this area.
HR Excellence Award 2009 The Company participated in the national level
prestigious contest organized by the Employers‚ Federation of Pakistan. The
Company was adjudged to be second in the multinational companies sector. The
recognition of high standards of performance by an independent national panel was
indeed a source of great encouragement for the associates and an honor for the
Company.

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Four P’s of Marketing:-
 Product
 Price
 Place
 Promotion
Products
Honda CD 70
CD 70 is an ideal combination of attractive design with super econo-power and
smoke-free 4-Stroke engine, which promises you the most economical ride of your
life. The new eye-catching graphics, comfortable new seat design and aerodynamic
shape have made Honda CD 70 best choice and a perfect partner. Further, high
resale value of Honda CD 70 proves to be a life time asset for its customers. Atlas
Honda’s extensive dealership network makes the motorcycle and its parts, available
at your doorstep and its countrywide warranty facilitate provide you trouble free
companionship.
Specifications:-
Engine 4-Stroke OHC single cylinder cooled by air
Displacement 72 cm3
Bore & Stroke 47.0 x 41.4 mm

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Compression Ratio 8.8:1
Clutch Multiple wt plates
Transmission continuous 4 speed mash
Starting Kick start
Frame Backbone type
Dimension(Lx W x H) 1897 x 751 x 1014 mm
Ground Clearance 136 mm
Petrol Capacity 8.5 Liter
Tire at Front 2.25 - 17 (4 PR)
Tire at Back 2.50 - 17 (4 PR)
Dry Weight 82kg
Honda CD Dream
The Honda CD Dream Making every dream of the youth come true Sleek, sporty,
stylish design all with an amazing feeling of individuality Powered by a superior and
durable Econo-power engine that’s engineered with technology, delivering
exceptional fuel efficiency and is environment friendly. Strong rear wheels and a
comfortable seat ensure a thrilling driving experience.
Specifications:-
Engine 4-Stroke OHC air-cooled

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Displacement 72 cm3
Clutch Multiple wt plates
Transmission Continuous 4 speed mash
Starting Kick Starter
Final Drive Backbone type
Dimension(LxWxH) 1899 x 751 x 1014 mm
Petrol Capacity 8.6 liters
Tire at Front 2.25 - 17 (4 PR)
Tire at Back 2.50 - 17 (4 PR)
Dry Weight 82 KG
Honda Pridor
Due to its dependable OHC Econo-Power Engine with a double cradle frame and
strong suspension, this motorcycle is the best possible travel partner on all sorts of
terrain. This is the reason why pridor is the choice of the adventurous. Because of its
aerodynamic design and sleek style every rider wants Pridor.
Specifications:-

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Engine 4-Stroke OHC air-cooled single cylinder
Bore & Stroke 50.0 x 49.5 mm--97.1 cm3
Transmission 4-Speed constant mesh
Final Drive Roller Chain
Measurement 1986 x 718 x 1050 mm
Seat height 798 mm
Ground clearance 156 mm
Fuel tank capacity 9.7 liters (reserve 1.5 liters)
Wheel Base 1226 mm
Tyre at Front 2.75 - 18 4 PR
Tyre at Back 2.75 - 18 6 PR
Suspension at front Telescopic Fork 94 mm travel
Suspension at back Swing arm 84 mm travel
Dry Weight 96 KG
Honda CG 125
CG125 is a stunning result of advanced Japanese technology and right up there as
an outstanding performer representing all the qualities that make Honda motorcycles
so special.
The 125 cc 4-stroke engine generates 11-Horse Power with low fuel consumption. It
is ideal for high speed, long runs and rough pathways. Honda CG125 has a CDI
Ignition System and a 12-volt battery (instead of 6-volt). The headlight and indicators
are brighter, with an easy starting-up of the engine.

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Specifications:-
Engine 4-Stroke OHV cooled by air
Wheel Base 1201 mm
Starting Kick start
Transmission Continuous 4 speed mesh
Dimension(Lxwxh) 1911 x 732 x 1016 mm
Height of Seat 771 mm
Petrol Capacity 9.2 Liter
Dry Weight 99 KG
Suspension Front Telescopic Forke 103 mm Travel
Suspension Back Swing Arm 68 mm Travel
Final Driver Roller Chain
Honda deluxe
The Deluxe is the unique combination of power & style, a new addition in the
company as 125 cc. The new power up 4 stroke engine gives same fuel economy as
CG 125. It’s an ideal model for youth and high income segment. Honda Deluxe has

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heavy duty front absorbers and 130 mm brake drum with environment friendly non-
asbestos brake shoes, Elegant contoured seat for better riding posture.
Specifications:-
Engine 4-Stroke OHV cooled by air
Displacement 124.1 cm3
Compression %age 9.0 : 1
Wheel Base 1278 mm
Starting Kick start
Petrol Capacity 12 Liter
Tyre at Front 2.75 - 18 42P
Tyre at Back 90/90 - 18 51S
Dry Weight 112 KG
Transmission Continuous 5 speed mesh
Frame Diamond Type Steel
Dimension(Lxwxh) 2032 x 758 x 1097 mm
Honda CG Dream
Modern design, comfortable seat, solid and unique seat bar Contoured and sleek
fuel tank with beautiful graphics and large self-locking cap Taillight with reflector for

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extra glow; sporty and solid rust-free rear fender Modern dashboard design; unique
dial with textured casing Large key, combination switch and handle lock together;
lockable in both directions Multi-reflector headlight with halogen bulb for enhanced
illumination; long lasting with two tone visor Tried and tested, high-tech OHV design
engine with unmatchable power and phenomenal performance.
Specifications:-
Engine 4-Stroke OHV air-cooled
Transmission 4-Speed constant mesh
Final Drive Roller Chain
Measurement 1964 x 747 x 1044 mm
Seat height 766 mm
Ground clearance 135 mm
Fuel tank capacity 9.2 liters (reserve 2 liters)
Wheel Base 1197 mm
Suspension at front Telescopic Fork 103 mm travel
Suspension at back Swing arm 68 mm travel
Dry Weight 99 KG

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Honda CBR 150
Specifications:-
Year 2013
Engine 149.4 cc DOHC 4 Stroke Single Cylinder
Starter Self-Starter
Transmission 6-Speed Constant Mesh
Fuel Tank Capacity 13.1 Ltrs
Weight 138 KG
Honda CBR 500

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Year 2013
Engine 471 cc DOHC 4 Stroke 2 Cylinder (in line)
Starter Self-Starter
Transmission 6-Speed Constant Mesh
Fuel Tank Capacity 15.5 Ltrs
Weight 194 KG
Pricing:-
Bike models Prices in PKR
CD 70 69900
CD Dream 73500
Pridor 86000
CG 125 102500
Deluxe 124000
CG Dream 105900
CBR 150 660000
CBR 500 1250000
Place:-
Atlas Honda has developed Pakistan’s largest after sale services network. The
company has made its 5 S dealers throughout the country.
These 5S stands for

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 Sales
 Services
 Spare Parts
 Second Hand Exchange
 Special Sales (credit)
According to the company these are not the simple selling points but these are the
complete HONDA Company. The company has made Dealer Development
Department, which is responsible for the co-ordination with dealers and training of
mechanics.
The year 2010 saw improvement in almost all the major marketing areas. The 5‘S’
dealer network was further expanded dealers have upgraded their dealerships to a
modern, global standard. The resultant image enhancement in the eyes of the public
has generated more customers for the company. The recall value of the promotion
has been rated as one of the highest ever. This policy has further cemented the
value of the product and a greater number of first time users are now Atlas Honda
customers.
COVERS ALL PAKISTAN
Atlas Honda has Pakistan’s biggest sales network. The company focused all over
the Pakistan, they sale their products by their authorized dealers.
Delivery System
Since Honda Company established, company has given the contract to Saleem
Raza Goods Transports Co. for delivering their products to their sales points. They
have very good relation with the company and they are contributing their best in
growth of company.
Promotion:-
The company focuses on its promotion campaign very seriously. There are several
internal and external programs to increase its sale.

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The company has made Service Development Department, which is responsible for
the co-ordination with dealers and training of mechanics.
The company is mostly using push strategy to promote its motorcycles.
Like CD 100 promotes by following strategy
 As CD-100 is their new product to promote it they force the dealers to
keep a CD-100 bike with them so that when customers come they offer
him to try the new bike.
 The company is offering package to dealers that for every ’x’ bikes of CD
70 or CG 125 you have to take “y” bikes of CD 100. This also forces the
dealers to try to sell this new product.
Technicians Training
For the promotion of its products the company has trained 7000 mechanics. These
mechanics are not only providing repairing services to the people but also publicize
the products of company by word of mouth.
For the promotion of its products the company arranges
rallies and ads of electronic and print media
SWOT Analysis:-
Strengths
 Organizational culture
 Good Corporate Image
 Qualified and well trained staff
 High Quality Products
 ISO Certified
 Resale value
 Customer Care
 Motivated, loyal and skilled employees
 Large Market share and volume
 Experienced, developed and loyal service dealers network
 Largest and penetrated 4-Stroke mechanics network

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 Availability of Spare parts
 Best training facilities
 Best warranty system
Weaknesses
 Electric shortfall
 High Price of Products
 Political instability
 Low per capita income of public
 Increasing Prices of Oil
 Rising inflation
 Lack of excellent marketing
Opportunities
 Exploration of new markets.eg. Srilanka, Africa. And other countries.
 Stabilize the improve process of export to Afghanistan, Srilanka, and
Bangladesh to capture more market share.
 Create loyal customer by various customer oriented activities/ services.
 Newly developed Areas/Markets (e.g. Gawader)
 Industry expansion
 Technology upgrading
Threats
 Competitors follow up to AHL’s dealers and offering various incentives.
 Chinese cheaper products challenges
 Strong competition from competitors in near future
 Instability of Government
 Energy crisis
 High rate of Taxation

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Financial Statement Analysis:-
Current Ratio from 2009 to 2014
Quick ratio=current assets/current liability
Years Current assert Current liability Current ratio
2009 3927828 3108529 1.26
2010 5259180 3157937 1.67
2011 6321732 4349462 1.45
2012 6976240 4810168 1.45
2013 7553157 4587303 1.65
2014 9600106 5622277 1.71

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Quick Ratio from 2009 to 2014
Quick ratio=current assets-inventory/current liability
Years Currentassert Current liability Inventory
Quick
ratio
2009 3927828 3108529 1792036 0.69
2010 5259180 3157937 1664297 1.14
2011 6321732 4349462 2003029 0.99
2012 6976240 4810168 2161328 1.00
2013 7553157 4587303 2171536 1.17
2014 9600106 5622277 2042602 1.34

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Inventory Turnover Ratio from 2009 to 2014
Inventory turnover=Cost of goods sold/inventory
years Cost of goods sold Inventory Inventory Turnover
2009 12782165 1617995 7.90
2010 23555842 1979482 11.90
2011 30080978 2331858 12.90
2012 35235893 2516849 14.00
2013 38646049 2559340 15.10
2014 40253929 2439632 16.50

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Average Collection Period from 2009 to 2014
Average Collection Period = AR / (Annual sales / 365)
Years annual sales days A.R
Average collection
period
2014 44478713 365 524978 4.00
2013 42325242 365 514742 4.00
2012 38011857 365 598265 6.00
2011 32521399 365 401435 5.00
2010 25554772 365 445689 5.00
2009 13747380 365 320180 7.00

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Total Assert Turnover from 2009 to 2014
Total assert turnover = Annual sales / Total assert
years annual sales Total assert Total asset turnover
2009 44478713 14365190 3.10
2010 42325242 12014438 3.52
2011 38011857 10960417 3.47
2012 32521399 9621230 3.38
2013 25554772 8522276 3.00
2014 13747380 7380653 1.86

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Debt ratio from 2009 to 2014
Debt ratio = Total liabilities / Total assert
Years Total liabilities Totalassert Debt ratio
2014 6451877 14365190 0.45
2013 5485261 12014438 0.45
2012 5540483 10960417 0.50
2011 4998816 9621230 0.52
2010 4630452 8522276 0.54
2009 4059391 7380653 0.55

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Time interest earned ratio from 2009 to 2014
Time interest earned ratio = Earnings before interest and taxes / Taxes
Years
Earningsbefore interest
and tax Tax
Time interest
earned ratio
2014 2689418 687858 3.91
2013 2207557 599753 3.68
2012 1620001 415892 3.90
2011 1410481 407925 3.46
2010 1077231 364773 2.95
2009 352779 128246 2.75

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Gross Profit Margin from 2009 to 2014
Gross profit Margin = Gross profit/ Sales
Years Gross Profit Sales G.P.M
2014 4224784 44478713 0.09
2013 3679193 42325242 0.09
2012 2775964 38011857 0.07
2011 2440421 32521399 0.08
2010 1998930 25554772 0.08
2009 965655 13747380 0.07

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Operating Profit from 2009 to 2014
Operating profit = OP/ Sales
years OP Sales Operating profit
2009 352779 13747380 0.03
2010 1077231 25554772 0.04
2011 1410481 32521399 0.04
2012 1620001 38011857 0.04
2013 2217283 42325242 0.05
2014 2697454 44478713 0.06

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Net profit margin from 2009 to 2014
Net profit Margin = Earnings Available for C.S/ Sales
years
Earnings Available for
C.S Sales Net profit Margin
2009 8592113 13747380 1.60
2010 9126704 25554772 2.80
2011 10490774 32521399 3.10
2012 11878705 38011857 3.20
2013 11138222 42325242 3.80
2014 9884158 44478713 4.50

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Earnings per Share from 2009 to 2014
EPS = Earnings Available for C.S/ no of share C.S outstanding
Years Earning Available for C.S
No of
Shares
Earnings Per
Share
2009 8592113 1808866 4.75
2010 9216704 703565 13.10
2011 10490774 654446 16.03
2012 11878705 709600 16.74
2013 11138222 572954 19.44
2014 9884158 510545 19.36

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Return on Assert from 2009 to 2014
ROA = earnings Available for C.S/ Total assets
years
Earnings Available for
C.S Total assert ROA
2009 8592113 14365190 0.60
2010 9216704 12014438 0.77
2011 10490774 10960417 0.96
2012 11878705 9621230 1.23
2013 11138222 8522276 1.31
2014 9884158 7380653 1.34

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Vertical Analysis of balance sheet from 2009 to 2014:-
Particulars 2014 2013 2012 2011 2010 2009
% % % % % %
Assets
Non-current assets
Property, Plant and
equipment 31.7 36.8 36 33.9 37.8 46.3
Intangible assets 0 0 0.1 0.1 0.1 0.2
Long term investments 0 0 0 0 0 0
Long term loan and
advances 0.2 0.2 0.2 0.2 0.2 0.2
Long term deposits 0.1 0.1 0.1 0.1 0.1 0.1
Total non-current assets 32 37.1 36.4 34.3 38.2 46.8
Current Assets
Stores, spears and loss
tools 2.8 3.2 3.2 3.4 3.8 5.8
stock in trade 14.2 18.1 19.7 20.8 19.5 24.4
trade depts. 3.6 4.3 5.5 4.2 5.2 4.3
Loans and advances 0.2 0.3 0.3 0.3 0.5 0.5
trade deposits 0.4 0.4 0.4 0.4 0.5 0.9
short term investments 25.7 13.6 13.3 13.9 12.8 6.2
mark up interest 0.1 0.1 0 0.1 0.1 0
Other receivables 0 0.1 0.1 0.2 0.1 1.3
taxation net 0 0 1.5 0.7 0 1.2
bank balances 19.8 22.8 19.6 21.7 19.3 8.6
Total current assets 66.8 62.9 63.6 65.7 61.8 53.2
Non-current assets 1.2 0 0 0 0 0

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classified as held for
sale
Total Assets 100 100 100 100 100 100
Equity and liabilities
Equity
Share capital 7.2 6.9 6.6 6.5 6.4 6.4
reserves 47.9 47.7 42.9 41.6 39.3 38.6
Total equity 55.1 54.6 49.5 48.1 45.7 45
Non-current Liabilities
long term borrowings 0 0 0 0 6 5.1
Deferred liabilities 5.8 7.2 6.6 6.7 13 12.9
Total Non-current
Liabilities 5.8 7.2 6.6 6.7 19 18
current Liabilities
Trade and other payables 38.8 38.2 43.9 44.2 36.5 35.8
mark up interest 0 0 0 0.1 0.4 0.1
long term borrowings 0 0 0 0.9 4.3 5.3
taxation net 0.3 0 0 0 0.1 0
Total current Liabilities 39.1 38.2 43.9 45.2 41.3 41.2
total equity and
liabilities 100 100 100 100 100 100

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Horizontal Analysis of balance sheet from 2009 to 2014:-
Particulars
2014 vs.
2013
2013 vs.
2012
2012 vs.
2011
2011 vs.
2010
2010 vs.
2009
% % % % %
Assets
Non-current assets
Property, Plant and
equipment 3 12.2 20.9 1.1 -5.5
Intangible assets -13.9 -13.5 -10.1 -11.4 -12.1
Long term investments 0 0 0 0 0
Long term loan and
advances 3.2 25.3 -8.9 19.1 31
Long term deposits 14.7 -46.6 46.1 -5.3 26.6
Total non-current assets 3 12 20.8 -5.5 1
Current Assets
Stores, spears and loss
tools 2.6 11.9 7 1 -24.7
stock in trade -5.9 0.5 7.9 20.4 -7.9
trade depts. 1.1 -14 49 -9.9 -7.1
Loans and advances 6.2 0.3 -1.1 -17.2 7.5
trade deposits 6.2 6.4 21.4 -5.5 -39.5
short term investments 125.7 12 9.1 22.9 138.9
mark up interest -4.1 166.9 -48.9 88.7 767.9
Other receivables -26 -58.9 1.7 30.3 -88.6
taxation net -100 -98.4 136 -100 100
bank balances 3.8 27.5 2.8 27.3 158
Total current assets 27.1 8.3 10.4 20.2 39.3

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Non-current assets 100 0 0 0 0
classified as held for sale
Total Assets 19.6 9.6 13.9 12.9 15.5
Equity and liabilities
Equity
Share capital 25 15 15 15 15
reserves 20 22 17.6 19.5 17.5
Total equity 20.6 21 17.3 18.8 17.2
Non-current Liabilities
long term borrowings 0 0 0 -100 36.7
Deferred liabilities -4.3 18.7 12.5 8.2 4.2
Total Non-current
Liabilities -4.3 18.7 12.5 -41.6 17
current Liabilities
Trade and other payables 21.6 -4.6 13 36.8 17.5
mark up interest 0 0 -100 -82.9 -48.3
long term borrowings 0 0 -100 -75.9 -7
taxation net 100 0 0 -100 100
Total current Liabilities 22.6 -4.6 10.6 23.6 13.2
total equity and liabilities 19.6 9.6 13.9 12.9 15.5

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Department understudy during internship:-
During the six week of my internship I was working in the finance department. The
finance department is further divided into different sub departments. My work in
those sub departments is given below:
1: Petty cash One week
2: Vendor payment One week
3: Taxation One week
4: Costing Two week
5: Payroll One week

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Petty cash Section:-
During my work in the petty cash department I have learned different new things.
What is the purpose of petty cash department? How the petty cash? What types of
software’s are being used in Atlas Honda? How entries are passed in the system by
the use of the software’s? How the process of bank reconciliation is done? How they
maintain the record of the entries in manual way?
Petty cash is a small amount of funds in the form of cash used for expenditures
where it is not sensible to make any disbursement by cheque, because of the
inconvenience and costs of writing, signing, and then cashing the cheque.
The initial fund would be created by issuing a cheque for the desired amount. An
amount of $100 would typically be sufficient for most small business needs as the
expenses to be covered are for small amounts. The bookkeeping entry for this initial
fund would be to debit Petty Cash and credit bank account.
As expenditures are made, the custodian of the fund will reimburse employees and
receive a petty cash voucher with a receipt/invoice attached in return. At any given
time, the total of cash on hand plus reimbursed vouchers must equal the original
fund.
Software’s used
The software’s which are being used in the Atlas Honda is SAP Logon 720, oracle
and Microsoft excel. The SAP Logon 720 is mainly used in the finance department
for making entries and maintaining records of entries.
Where the oracle is mainly used by the HRM department and this is also used for the
payroll because the payroll section is connected with the HRM department in such a
way that they maintain the record of the shifts, absenteeism and over timing.
And the Microsoft excel is used a lot during the making of different type of lists and
calculations.
Passing of entries

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I have also learned how entries are passed into the system by using SAP Logon.
First the name of vendor is added with the company has made transaction after the
invoice date and the posting dates are added than the cheque number by which the
payment was made is written. Amount in PKR is entered and tax amount is also
added if any tax is applicable.
Serial
no
G/L
acct
Debit/credit Amount
in doc
text Cost
center
order
Other details are entered in above manner into the system.
Manual recording
The entries of payments sections which are entered into the Sap Logon 720 are
maintained in different monthly office files mainly two type of files are being used;
one is for maintaining record of the cash payment vouchers in which documents are
arranged according to the voucher numbers which are created while entry is made
into the Sap Logon 720. These voucher numbers act like an identity of vouchers.
The other file is used to maintaining the record of bank payment vouchers and
similar way of arrangement is used in the case of bank payment vouchers. The
purpose of doing this is to save the company in the form of any date loss from the
system and for the checking purposes.
Bank reconciliation
The process of bank reconciliation is done at the end of the every month to analyze
and adjustment of differences between the cash balance shown on a bank
statement, and the amount shown in the cash book made by the Sap Logon 720. In
the case of payments section, company is maintaining two different accounts first is
with the Habib bank limited and second one is with the United bank limited. So, at

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the end of month payments head have to reconcile two different accounts. This is
done in the following steps.
Steps of bank reconciliation
Step 1:- Tick off the items in both cash book and bank statement
The items which are present of both the bank statement and the cash book are ticked.
The payments made are ticked with the debit side of the bank statement and the receiver
side of cash book is ticked with the credit side of the bank statement
Step 2:- update the cash book from the bank statement
The un-ticked items on the bank statement indicate items that have gone through the
Bank account but have not yet been entered in Atlas Honda’s book. So these items are
added in the cash book to bring it up to date.
Step 3:- balance the cash book bank columns to produce an updated balance
Step 4:- identify the remaining un-ticked items from the cash book
Step 5:- preparation of the bank reconciliation statement
1. Enter the cash book balance
The balance which is shown in the cash book is entered.
2. Add un-presented cheques
The un-presented cheques are the cheques that Atlas Honda has issued, but which
have not yet been deducted from the firm’s bank account is added into the cash
book balance.
3. deduct outstanding bank lodgment

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A bank lodgment represents money, cheques and cash that has been received by a
business, entered into the cash book and paid into the bank. In this case the deposit
has been made too late to appear on the firm’s bank statement and these amounts
are deducted from the cash book balance.
4. completing the reconciliation
After all additions and deductions the final statement appears showing off the
balance as shown in the bank statement.
Taxation Section:-
During the work in the taxation section I have experienced the working of the
taxation section. What type of software is being used for the calculation and
reporting of taxation? How the taxation section is interlinked with other sections of
the finance department? What types of laws exist for the calculation of tax in
Pakistan? How the tax is paid to the government and what is the role of the FBR
during the whole process?
Software’s used
In the section of taxation the software which is mainly used is the Microsoft excel and
word. Excel is used for the preparation of different lists where as the word is mainly
used for the preparation of different type of documents.
Linkage to other sections
The taxation department is mainly interlinked with the vendor payment section and
the payroll. First the entries are recorded in the SAP logon 720 by the executive and
assistant manager to whom the payment is made or received. They also enter the
amount of the tax which is required to be detected from the total amount paid to the
vendor according to the code provided by the government of Pakistan on the website
of the FBR. Than the executive of the taxation section collect the date from the SAP
logon 720 and then perform different type of procedures for the payment of tax.
Mainly these tax payments are done four times in a month when the transactions of
one week are done the taxation section pay the tax into the upcoming next week.

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Same as above the payroll section is also interlinked to the taxation section in such a
way that the payroll executives and assistants managers make entries into the
oracle, than after the completion of the payroll lists, these lists are sent to the
taxation section where the taxation section deduct the amount of the income tax
according to the code for deducting the tax and then pay the tax through a process.
Process of tax payment (Withholding income tax)
The process of the payment of the WHIC is done into different steps which are the
following ones:-
1. SAP entries:-
The first step in the payment of the WHIC starts with the entries into the SAP logon
720. Mainly these entries are made by the executives and the assistant manager of
the vendor payment section. These entries are mainly the payments which are made
to different vendors after receiving of the goods and services.
2. Tax deductions
The vendor payment section enters the amounts which are required to be deducted
from payment according to the code of conducts and laws provided by the
Government of the Pakistan these tax deductions are recording while the making of
the entries of the payment to the vendors.
3. Picking entries from the SAP
After the entries are made into the system and tax amounts are entered the taxation
executive picks the SAP logon 720 and make the excel file from it and this file is sent
to the FBR.
4. Uploading file on FBR website
After the file is made, it is uploading on the FBR website. While uploading the excel
file we put different type of information i.e. we enter the Cheque number thought
which the amount will be paid to the Pakistan. After putting the information we get a

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PSID (payment system Identification) number. Which contain the information of the
whole transaction.
5. Payment in national bank
Then cheque is presented in the national bank of Pakistan for the tax payment
purpose. The account of AHL is than credited and payment is made. During this
process the Bank checks the PSID number for completion of transaction.
6. CPR certificate
When payment is received by the FBR, they issue the CPR (cash payment received)
certificate to the Atlas Honda and these certificates are sent to the different vendors
thought the courier service.
Exceptions certificates
Exception certificates are those certificates which are issued by the FBR to the
vendors on the advance payment of tax. These certificates are valid for a particular
time period. During these period vendors are not liable to pay any income tax.
Sometimes vendors have exceptions of income tax, so while making entries in SAP
the vendor payment section check if any vendors have got any exception, if there is
any exception than income tax amount is not paid.
Sale tax:-
A sales tax is a tax paid to a governing body for the sales of certain goods and
services. Usually laws allow (or require) the seller to collect funds for the tax from the
consumer at the point of purchase.
Process of sales tax deductions (VAT system)
The process of sales tax deduction is divided into two parts. First part is known as
input which deals mainly with the tax paid on purchases made by the Atlas Honda.

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Second part is known as the output, which deals with the tax paid on the sales made
by the Atlas Honda.
Input (purchases)
These taxes are those taxes which are already paid by the supplier to the
Government of Pakistan on the behalf of the Atlas Honda. Than the supplier send
the sales tax invoice to the Atlas Honda for the reimbursement of the tax paid by
him. The Atlas Honda collects all invoices paid by different vendors during a month
and then makes a list of it to claim the taxes from the government of Pakistan.
During a year Atlas Honda makes twelve claims. Then these amounts are paid by
the Atlas Honda to the vendors in the form of cheque.
Output (Sales)
After receiving the Raw material from different vendors during the month the Atlas
Honda makes a list of all bike sold during the month, and after the making of bikes
from the raw material and then selling them in the market they pay tax at the rate of
17% to the government.
Adjustments in input and output
The final tax paid by the Atlas Honda is in an adjusted manner. For example if the
total sales tax which is to be paid to the government is 1700000 rupees, the Atlas
Honda first check how much tax their vendors have paid on the behalf of Honda, if
the amount which is paid by the vendors is 1000000 rupees than the Atlas Honda
will only pay an amount of 700000 rupees to the government of Pakistan. These
adjustments are made thought the issuance of debit and credit notes.
Differences between the conventional sales tax system
and VAT system
In the conventional system the total amount of tax was paid at the end when any
product was sold but in the VAT system some amount of tax is already paid to the
government of Pakistan so the speed of cash flows is increased in the VAT system,
and also the illegal tax evasion activities are prevented.

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Costing Section:-
During the work in costing section I have observed the working of the costing section
and took an overview the whole section from the start to the end. What type of
software’s are being used in the costing section? What are the parts of the costing
section? What is the responsibility of this section?
Software used in costing
The main software’s which are being used by the costing section are the Microsoft
excel and the CO module of the SAP logon 720.
Linkage of costing to other departments
The costing section is directly linked with the department of the Research and
development and the department of the Vendor Procurement. It is also indirectly
linked to the different work shops and stores.
Working of costing section
There are mainly two roles of the costing section:
 Inventory control
 Costing
Inventory control is a main part of the working of the costing section. The costing
section role is to supervise the inventory management process. The inventory control
is further divided into two parts first is known as the Stock and second one is known
as the stores.
Stock and its working
The stock section contains the parts of the bikes which are used while the production
of bikes in different shops of the factory. So, maintaining a check on the requirement
of the stock comes into the vendor procurement and the costing section.

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Working
The working of the stock section is explained into the following steps:
Step 1:- The first step of the stock control starts from the department of the
Research and development in which they define a list or bills of materials which is
also known as BOM which carry information about what type of parts will be used for
the production of the bike. BOM making is a one-time activity during the production
of any model of bike. The changes in the BOM occur only when the model of a bike
in upgraded in sense of technology.
Step2:- In the second step of the stock control each item mentioned in the BOM
(bills of materials) every item mentioned in the BOM is assigned a SAP code for the
ease of making entries into the system.
Step 3:- In the third step a meeting is held between the vendor and the department
of vendor procurement. Persons from the costing section are also part of this
meeting. In this meeting different type of negotiations are done on the rate of the
supplies provided by the vendor. This price committee is held after a year and the
rates remain constant for a year.
Step 4:- In the fourth step the purchase order is given by the vendor procurement
department to the vendor.
Step 5:- In the fifth step MRP (material resource planning) make a schedule for
purchasing through different vendors in the form of a production order.
Step 6:- Than at the sixth step a document of good received is run by the vendor.
That he has supplied the things asked to him in the production order.
Step 7:- Than finally the parts are distributed to the different shops and the
departments according to the daily requirement of the shops.
In this whole process the person of costing section stand side by side other
departments such as RND and vendor procurement with the purpose of inspection
and for providing guidance in form of any ambiguity.

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Stores
The stores also come under the inventory control. The store mainly deals with those
things which are not a part of the bikes but they help in the making of bikes or make
the process of making bikes easy and fast. There are mainly three types of things
which are maintained and provided by the store. These things are the following ones:
 Consumables
 Tools
 Spares
Consumables
These are those items which are used for one time only or for a short period of time.
Such as office equipments, shop equipments (gloves).
Tools
These are the tools which are used for the making of the bikes and these things last
long.
Spares
These are the spare parts of the machines which are used during the production of
the bikes.
Process of stores
Step 1:- The process of stores starts with the PR (purchase request) which is issued
by the different departments and shops according to the requirements.
Step 2:- In the second step different quotations are made. The role of quotations is
same as the role of the price committee’s. Here the selection of vendors is done and
rates are decided.
Step 3:- In the third step the PO (purchase order) is given to the vendor for the
purchase of items. Then these items are given to perspective departments who have
initiated the purchase requisition.

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Costing:-
The costing is the second task of the costing section in the finance department. The
costing work is done by the CO module of the SAP logon 720. There are mainly
three ways by which the cost is incurred.
First cost is known as the production cost. These are those costs which are incurred
while the purchase of the raw materials which will be used for the production of the
motor bikes.
Second type of cost is known as the service costs. Which are incurred in the form of
service obtained from different sources by the Atlas Honda such as the service
obtained from the employee's and the salary or wage is the cost factor here?
Electricity bills and gas bills also come under these costs.
The last type of cost incurred by the Atlas Honda is the promotional and sales cost.
Those are incurred by the Atlas Honda while performing different type of promotional
activities such as advertizing.
Working of costing
The cost of producing a unit of bike is equal to the accumulated cost of different
departments working together. Cost which is incurred over a bike is divided over the
different department costs, and the cost of every department is calculated in the form
of different heads, and these costs are entered in the form of these heads into the
SAP logon 720. There are mainly five different heads which are the following ones:-
 Materials Cost
 Labour cost
 Factory overhead
 Variable overhead
 Machine cost

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Process
The calculation of cost beings from the first shop (Shop A) in which the process of
making bike is initiated. For example if in the shop A only engine is being made than
the cost for making a particular set of engines is calculated in the form of material
costs, labour cost, Factory overhead, variable overhead and machine cost and at the
end of making a set of engines during a time period the cost of these heads are
added up. This added up cost represents the cost of the engine shop (shop A).
Like this the cost of others shops and departments are calculated into the form of
these five heads and then they are added up. At the end the cost of all departments
are added and a sum cost amount is generated which represents the cost of a
particular set of bikes.
These costs cover only the first type of cost which is known as the production cost of
bike. The final cost is calculated after added up all three types of costs. And per unit
cost of bike is calculated by dividing the total cost with the number of units produced.
Production cost + services cost + sales cost = Total cost
Vendor Payment section:-
The purpose of the vendor payment is to make the payments to different vendors
who are supplying different type of products in the form or raw materials and other
finished goods which are very important to run the operations which are required to
for the making of bikes.
Software’s used
The software’s which are used by the vendor payment section are the Microsoft
excel and the FI module of the SAP logon 720.

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Working of the vendor payment section:-
Supplies
Purchase order
Purchase order
Delivery Challan
GRIR
Sales tax invoice
Payment
process
Payment
Vouchers
Cheque sent
to vendors
Cheque
Entered in SAP
Received in Store
30 days credit
period is
considered
WHST is
calculated by
SAP
Exemption
certificates are
checked
Cheques
printed
Cheques
signed by 2
signatories
Purchase order is
approved

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Linkage of vendor payment to other departments
The vendor payment section is linked with the logistics department and the vendor
procurement department. These two departments are those who initiate the
purchase orders to buy different type of things and materials which are required to
run the factory. And after that the payment against these purchase orders is done by
the vendor payment section of the finance department.
The process of payment is done into the following steps:-
Step 1:-
Firstly the purchase order is given by the different shops and departments according
to the requirements. And the purchase orders are initiated by the vendor
procurement department and the logistics department. The order related to parts of
bikes is given by the vendor procurement and the others tools which help in making
the bikes comes under the logistics.
Step 2:-
Than the purchase order is approved by the general manager of respective
department and general manager of supply chain.
Step 3:-
Then the order is given to the vendor for the purchase of the equipment’s and tools.
After the purchase these equipment’s are received in the store. And delivery challan
is issued. Good received are recorded in the SAP.
Step 4:-
In the fourth step the invoices are sent by the vendor to the vendor procurement and
these invoices are further send to the finance department for the payment settlement
purpose.
Step 5:-

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When these invoices are received by the executive of vendor payment section the
process of payment process starts.
Step 6:-
SAP checks the due date of the invoices which are to be paid and it includes only
those invoices which are due for 30 days or more.
Step 7:-
The amount of the withholding income tax is deducted according to the formula
defined by the government of Pakistan.
Step 8:-
Before the deduction of the income tax the vendor payment section checks if the
vendor is having a tax exception certificate. If there is an exception certificate than
no tax amount is deducted.
Step 9:-
Then payable amount is finalized and the cheques are printed by the SAP. After the
printing of cheques these cheques are signed by the two signatories for the payment
purpose.
Step 10:-
The bank payment vouchers are printed by the SAP and these vouchers are signed
by the finance manager. Then a file is made by these vouchers for maintaining a
record.
Step 11:-
Than at the end of this process the cheques signed by two signatories are sent to
the vendors for the payment.

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Payroll:-
The purpose of the payroll is in any company is to maintain the record of the
salaries, wages, bonuses and other type of different deductions and then after the
full processing paying the salaries to the employees of the company.
Software’s used
The software’s which are used in the payroll section are Microsoft excel and the
oracle.
Linkage of payroll to other departments
The payroll section is directly linked to the human resource department, Taxation
section and the petty cash section of Atlas Honda Limited.
Working of the payroll section
There are mainly three types of the staff working in the Atlas Honda Limited.
 Management staff
 Non-management staff
 Contract bases
Managementbased staff
Those employee or workers who are the permanent employee of the Atlas Honda
Limited come under this category.
Non-managementstaff
In non-management staff those employee’s come who are the members of the
worker union.
Contractbased

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In Contract based staff those employee’s come who are not employee of the Atlas
Honda Limited but they are provided by different vendors for the purpose of services,
For example MCCC and Hi-tech.
The payroll deals only with the management based and non-management based
staff.
Things managed by payroll
There are two type of things which are managed in the payroll while the process of
payment of salaries and wages.
 Salaries and other benefits
 Provident fund and settlements
Salaries and other benefits
In the salaries and other benefits record of different heads are maintained in these
heads employee salaries, employee salary advances, personal loans, motor car/
bike benefits are managed.
Provident fund and settlements
In this part of work the record of the provident fund and other finals settlements are
done.
Payroll process
The process of payroll is done in different steps:-
Step 1:-
In the first step the record of the employee attendance, over time and leaves of
employee’s is maintained in the human resource department in the form of statistical
data. And before the end of the month the record is sent to the payroll section for the
financial work.

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Step 2:-
In the payroll section the details provided by the human resource department are
entered into the oracle. Here the amounts such as the basic pay, total salary,
advances and tax payable amounts are added.
Step 3:-
In the third step the entered data in the oracle Is checked and after the checking of
the data pay slips are issued to the employee’s in the following format.
Salary breakups Deductions
Basic pay Income tax
House rent Van charges
Conveyance Canteen charges
COLA (cost of living allowances) EOBI(employee old age befits)
Utility Pension fund
Medical MC/ Bike loan
GROSS SALARY
Step 4:-
In the fourth step a list is made by the payroll section containing the employee
number, name, account number and amount payable. And this list is send to the
bank in which the company is maintaining its account in the form of a request letter
of transferring the payable amounts to the accounts of different employee’s.

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Conclusions and Recommendations:-
Conclusion:-
After working and being a part of the Atlas Honda Limited during the six weeks of my
internship. I have learned a lot of things which can never be learned from any book. I have
experienced how the practical work is done in the organization like Atlas Honda Limited.
During the last six weeks I have worked in the finance department of the Atlas Honda
Limited and experience the work of different sections of the finance department. Such as
petty cash section, taxation section, vendor payment section, costing section and payroll
section. All these sections of finance department are interlinked with each other thought SAP
Logon 720, and the finance department is also linked to many other departments such as
Human resource, vendor procurement, logistics and marketing.
I have observed the working from the start when the purchase requests are made by
different departments and shops then the selection of vendors for the fulfillment of these
purchase requests, the involvement of the costing during this process and finally after the
delivery of the goods how invoices are transferred to the vendor payment and petty cash
department and while the payment of these delivered goods or services the role of the
taxation section for the deduction of the tax amount according to the rules and regulations
defined by the Government of Pakistan.
I have also experienced how the entries are passed on the SAP Logon 720 and how the
cash books are maintained and bank reconciled after the end of every month.
In the payroll section I have observed that how the salary is divided into different parts. What
types of benefits are given to the employee’s by the company.
At last I have experience the whole processing of the work of all above mentioned sections
of the finance department.

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Recommendations:-
If we see the Overall performance of the Atlas Honda Limited it represents an image
of a well established organization, in many aspects we can score it 10 out of 10 but
there are few points where some changes are required.
First of all the most important recommendation is that Atlas Honda Limited is a large
organization where a lot of workers are currently working but there is no mosque
inside the factory, employees have to go to some other place to offer their prayer. So
Atlas Honda Limited should have a mosque in side the factory.
Secondly, some improvement are required at the marketing side even though Atlas
Honda is market leader but the can boost up their sales by some attractive
advertisements. Recently they have launched CBR 150 and CBR 500 and they are
not marketed well. Even there is market gap of the sports bikes in Pakistan, and
production should be started in Pakistan to cut down the prices of these two bikes.
Thirdly, some design changes are required it’s been years now that same shape
bikes are being produced. In the up coming year when Honda’s major competitor is
about to enter, they may come with the attractive designs and this can become a
reason of capturing the market of Honda, so to avoid this uncertain situation design
improvements should be made.
Fourthly, the Atlas Honda Limited should start a “DREAM RACE EVENT” which will
hold after an interval of one year, where bikers can race with others and feel the
POWER OF HONDA. This event will act as a marketing trick for Atlas Honda
Limited, and can boost the sales of the 125cc and 100cc bikes.
Finally last recommendation for Atlas Honda Limited is that they are running an100%
equity based business so they are free from paying any type of interest, which is a
good thing in the Islamic perspective. But in the section of current assert of the
balance sheet of Atlas Honda Limited I have seen that they are investing funds in
those securities where earning are few and they are in the form of interest. If we see
it at a business point of view then it’s a good thing but in Islamic point of view it’s
wrong. So, they should invest their money in some interest free place so their
earrings will be totally interest free.

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References:-
Nasir, M. (n.d.). Pakistan motorbike market. Retrieved from
http://mobileworld.com.pk/2013/05/pakistan-motorcycle-market/
Atlas honda limited. (n.d.). Retrieved from atlashonda.com.pk
Still growing: Profits rev up for atlas honda. (n.d.). Retrieved from
http://tribune.com.pk/story/664203/still-growing-profits-rev-up-for-atlas-honda/
Atlas honda limited. (n.d.). Retrieved from
http://connection.ebscohost.com/c/articles/8717011/atlas-honda-limited
Financial results. (n.d.). Retrieved from http://ppinewsagency.com/130350/atlas-
honda-limiteds-financial-results-for-the-three-months-ended-june-30-2013/

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Appendix:-
Bank payment vouchar:-

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Cash payment vochar:-

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Income tax payment Challan:-

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Sales tax computation:-

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Exemption certificates:-

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Certificate of collection or deduction of tax:-

Internship Report Atlas Honda Limited

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