ANALYSIS OF FINANCIAL STATEMENT EXECUTIVE SUMMARY INDUSTRY PROFILE The healthy growth in the industrial sector achieved during 2003-04 has continued during the current year as well with overall industrial growth (measured in terms of the index of Industrial Production) growing at a rate of 7.9 percent during the April- September 2004-05 compared with 6.2 percent achieved during the same last year. The existing installed capacity in the industry is of the order of 4500 MW thermal, 1345 MW of Hydro and about 25 MW of gas based power generation equipment per annum and manufacturing units depending upon the needs and their capacity are augmenting the capacity. COMPANY PROFILE THE KIRLOSKAR GROUP A significant event in history of Indian industry was the rise of the Kirloskar Group of companies to a multibillion conglomerate. The founder Mr. Laxmanrao Kirloskar strongly believed that a company’s progress was determined by the integration of man and his intellect with technological growth and environment. BABASAB PATIL 1
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ANALYSIS OF FINANCIAL STATEMENT
EXECUTIVE SUMMARY
INDUSTRY PROFILE
The healthy growth in the industrial sector achieved during 2003-04 has continued during
the current year as well with overall industrial growth (measured in terms of the index of
Industrial Production) growing at a rate of 7.9 percent during the April- September 2004-
05 compared with 6.2 percent achieved during the same last year.
The existing installed capacity in the industry is of the order of 4500 MW
thermal, 1345 MW of Hydro and about 25 MW of gas based power generation equipment
per annum and manufacturing units depending upon the needs and their capacity are
augmenting the capacity.
COMPANY PROFILE
THE KIRLOSKAR GROUP
A significant event in history of Indian industry was the rise of the Kirloskar
Group of companies to a multibillion conglomerate. The founder Mr. Laxmanrao
Kirloskar strongly believed that a company’s progress was determined by the integration
of man and his intellect with technological growth and environment.
The first kirloskar product, “iron plough”, was an innovation far ahead of
its time a product designed wholly with the customer in mind. it ultimately became an
instrument of wealth for an entire society.
His words breathe the spirit with the Kirloskar industrial journey began. And this
spirit has continued through the passage of time. K.E.C Ltd. An ISO 9001 certified
Company was established in 1946 with its registered office at Rajajinagar in Bangalore.
As a part of diversification activity, K.E.C Ltd. started another unit at Hubli in 1969, to
manufacture Electric motors ranging from fractional horsepower to motor up 20HP.
Under the leadership of Shri Laxmanrao Kirloskar and Shri N.W.GUJAR, K.E.C unit-1
BABASAB PATIL 1
ANALYSIS OF FINANCIAL STATEMENT
Was started in Bangalore, Kirloskar Electric Company is the pioneer in India in the
manufacture of quality equipments like AC and DC electric motors, generators, welding
equipments, controls equipments transformers etc.
OBJECTIVES OF THE STUDY
To study on the financial performance of the company for the past 4 years.
To bring out the results of financial statements through ratio analysis.
To study about the Kirloskar electric company limited. Hubli in general.
To study the financial position of the company.
SCOPE OF THE STUDY
The scope of the study is the covered area for the purpose of study. The study is
limited to KAYTEE SWITCHERGEAR LIMITED (subsidiary of kirloskar electric co.
ltd) Unit –II.
METHODOLOGY
Methodology is the systematic method or an activity, which is used to collect
the information required to complete this project work.
The data is collected by 2 methods:
1. Primary data
2. Secondary data.
Primary data is collected through collecting information from company officers, from
external guide.
Secondary data, which is secondary in nature i.e. already, collected information this
secondary data is collected through Company’s Annual Report and discussion with them.
Interpretation of:
Balance sheet
Profit and loss account
Annual reports
BABASAB PATIL 2
ANALYSIS OF FINANCIAL STATEMENT
INTRODUCTION OF THE STUDY
The accounting process begins with the recording of transactions in the books of
primary entry. The accounting information resulting from the transactions so recorded
gets posted in to various accounting heads in the ledger. In the ledger each account is
balanced at the end of an accounting period and a summary of all balances in the various
accounting heads from the ledger is prepared which is known as trial balance from such
trial balances and after effecting certain adjustments considered necessary (which is
dependent on the particular accounting system followed by the organizations) the
financial statements relating to the accounting period are prepared.
NEED FOR THE STUDY
There are some questions, which arise from the study of financial statements.
These could be “Is Company’s profitability adequate? Why is a profit low in spite of
increased sales? Why is there liquidity problem though profitability is good? Why no
reasons for changes in assets, liabilities and equity between two dates? Why no dividends
are paid though there are good profits? From where have come cash flows and how they
are applied? These and many other questions need answers, which can be possible when
the financial statements are suitably analyzed
Thus financial statement analysis deals with meaningful interpretation of financial
data available in financial statements to serve specific purpose of organizations of such
data for their decision making .this involves identifying the purpose and selecting suitable
means of analysis. Financial statement analysis is essentially purposive.
ABOUT THE ORGANIZATION
Kirloskar group of companies are a century old company which comprises of over
20 companies with a total turnover of over Rs.1200crores and personnel strength of over
25000 workers, engineers and managers.
In the history of India industry, a significant event was the rise of kirloskar group of
company.
BABASAB PATIL 3
ANALYSIS OF FINANCIAL STATEMENT
The kirloskar stands for excellence in engineering, quality and reliability. The business
areas of the group companies reflects its diversity, process control equipment and
machine tools, rotating electrical machines, internal combustion, engines, computers etc.
The company started with manufacture of AC Motors 1984. Today KEC manufactures
diversified product range consisting of AC Motors, AC Generators, Transformers, DC
Motors and Electric equipments. The Unit-II in Hubli, Kirloskar Electric Company
limited is a subsidiary of Kirloskar electric company limited. It manufactures AC Motors
and AC Generators.
BABASAB PATIL 4
ANALYSIS OF FINANCIAL STATEMENT
INDUSTRY PROFILE
The healthy growth in the industrial sector achieved during 2003-04 has continued during
the current year as well with overall industrial growth (measured in terms of the index of
Industrial Production ) growing at a rate of 7.9 percent during the April- September 2004-
05 compared with 6.2 percent achieved during the same last year.
The worldwide electric power industry provides vital services essential to modern life. It
provides the nation with the most prevalent energy form known in history electricity. It
advances the nation’s economic growth and productivity; promotes business development
and expansion; and provide solid employment opportunities to workers globally in
general and India in particular. It is a robust industry that contributes to the progress and
prosperity of our nation. Today the electric power industry operates in a hybrid model of
competition and regulation. The worldwide electrical and electronics industry is growing
at a fast pace which consist of manufacturers, suppliers, dealers, electricians, electronic
equipment manufacturers.
Power industry restructuring, around the world, has a strong impact on Asian power
industry as well. Indian power industry restructuring with a limited level of competition,
since 1991, has already been introduced at generation level by allowing participation of
independent power producers (IPPs). The new Electricity Act 2003 provides the
provision of competition in several sectors. It is felt that the prevailing condition in the
country is good only for wholesale competition and not for the retail competition at this
moment.
As per the recent survey, the global electric & electronic market is worth $1, 03.8 billion,
which is forecasted to grow to $ 1,216.8 billion at the end of the year 2008. If we talk of
electric & electronic production statistics, the industry accounted for $ 1,025.8 billion in
2006, which is forecasted to reach $1,051.5 billion in future.
BABASAB PATIL 5
ANALYSIS OF FINANCIAL STATEMENT
Size of the Electric/ Electronic Industry
Top three electric and electronic goods manufacturing countries in the world are;
United States of America, Japan and Korea respectively, The United States of America
being the largest producer of electronic products worldwide contributes the total share of
around 21% furthermore; USA is at the forefront to have the largest market share with
around 29% in the global market.
The world’s electrical market size was $ 1038.8 billion in 2006, since last year an
increase of 10.6% is forecasted to grow even more. The industrial electrical goods
industry size was $ 651.3 billion, contributing around 62.7% of the total. With regard to
electronics parts and components sector, the total market share was around $ 282.7
billion i.e.; 27.2% while home electronics was 104.7 billion. This figure is supposed to
increase in this decade.
Major Production and Export Centers
As electronic manufacturing industry is growing with a fast pace, Western Europe is
developing gradually to contribute this industry. Western Europe comprising of 16
countries is contributing around 22% of the global market. Simultaneously, Eastern
Europe is forecasted to grow about $ 24 billion in 2013 from $ 9 billion in 2006.
If we talk of Asia Pacific region, China, Japan, North & South Korea, Singapore and
India are the top manufacturer of electrical and electronic products. Among these Asian
countries, China is becoming the manufacturing region of electronic products on the
globe.
In United States of America, cities like New York, Atlanta, Colorado, Detroit, Florida,
and New England, San Diego, San Francisco, and Texas can be named as industrial hubs
of electronics industry.
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ANALYSIS OF FINANCIAL STATEMENT
At present, Asia is growing with more speed in comparison to America and Europe. In
2002, Asia occupied 41% of total electronics market share, which grew up to 56% in
2007. Those days are not far away when Asia will become the market leader globally.
Future Outlook of Electric & Electronic Industry
Totally, the electrical and electronic industry is experiencing phenomenon and
remarkable changes worldwide. The worldwide electronics industry is distinguished by
fast technological advances and has grown rapidly than most other industries over the
past 30 years.
Products are heading towards new destinations where cost is less than other place with
higher costs involved. These places offer the most long term potential for market growth.
Companies indulged in manufacturing electrical products are investing a lot on research
and development for the best products to meet the demand of the market. They are
manufacturing the products with the best quality at reduced cost due to many
competitors.
BABASAB PATIL 7
ANALYSIS OF FINANCIAL STATEMENT
COMPANY PROFILE
THE KIRLOSKAR GROUP
A significant event in history of Indian industry was the rise of the Kirloskar
Group of companies to a multibillion conglomerate. The founder Mr. Laxmanrao
Kirloskar strongly believed that a company’s progress was determined by the integration
of man and his intellect with technological growth and environment.
The first Kirloskar product “the iron plough”, was an innovation far ahead of its
time a product designed wholly with the customer in mind. It ultimately became an
instrument of wealth for an entire society. The group is committed to innovation, quality
and continuing technological advancement. This is evident in their and customs designed
products, which have already gained a worldwide reputation for meeting critical
industrial needs. The company’s growth within the country and their entry into global
market is based on their highly skilled Human resource and their vast distribution
network. We have some of the best engineering and technical brains in the country, who
have made their mission immensely productive and successful.
.K.E.C at a glance
A country’s progress has been closely linked to effective harnessing and use of
electrical energy for the benefit of its people. Kirloskar Electric Company’s endeavor has
been to contribute cost effective solutions in all application of electricity. They are
actively involved in supplying electrical industrial electronic equipment, systems to
industry, agriculture and utilities. In all these ventures, their focus has been to provide
state of the art technology that can living standards and thereby make the environment a
better place to live in.
In the words of Mr. Laxman Kirloskar:
“My faith is in the human intellect. It gives us our means to create wealth by
directing our talents towards procedure work. And therefore, freedom for individual
ability is the only way a society can prosper. After all, you cannot distribute wealth
unless you first create it. And you cannot create it unless you know how”
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ANALYSIS OF FINANCIAL STATEMENT
His words breathe the spirit with the Kirloskar industrial journey began. And
this spirit has continued through the passage of time. K.E.C Ltd. An ISO 9001 certified
company was established in 1946 with its registered office at Rajajinagar in Bangalore.
As a part of diversification activity, K.E.C Ltd. started another unit at Hubli in 1969, to
manufacture Electric motors ranging from fractional horsepower to motor up 20HP.
Under the leadership of Shri Laxmanrao Kirloskar and Shri N.W.GUJAR, K.E.C unit-1
Was started in Bangalore, Kirloskar Electric Company is the pioneer in India in the
manufacture of quality equipments like AC and DC electric motors, generators, welding
equipments, controls equipments transformers etc.
The company started with manufacture of AC Motors in 1984. Today KEC
manufacturers diversified product range consisting of AC Motors, AC Generators,
Transformers, DC Motors and Electronic Equipments. The Unit II in Hubli, Kirloskar
Electric Company Limited is a subsidiary of Kirloskar Electric Company Limited. It
manufactures AC Motors and AC Generators.
BABASAB PATIL 9
ANALYSIS OF FINANCIAL STATEMENT
EMPLOYEES PROFILE
KEC Ltd. has a strong employee base. It has maintained fully trained and experienced
workers. It values its employees and the employees are considered the real Asset of the
company.
The employees are very hard working and dedicated towards the growth of the company.
The employee base can be depicted based on the number of employees in each section.
SECTION NO. OF EMPLOYEES
Canteen 9
Central Planning Dept. 5
Production Dept. 32
Engineering Dept. 13
Finance Dept. 14
Forwarding Dept. 3
General Stores 12
MED 3
Marketing Dept. 7
Packing Dept. 32
MMD and MSD 17
Personnel Dept. 4
Quality Assurance Dept. 73
Reception 1
----------
229
BABASAB PATIL 10
ANALYSIS OF FINANCIAL STATEMENT
MILESTONES IN THE HISTORY OF KEC
1946 ---- KEC established at Bangalore.
1948 -- A new era opens for Indian K.E.C produces the country’s very first AC
motors
1954 ---- Impatient for progress, the company gets into product diversification producing
its first transformers.
1956 ---- First transformer manufactured.
1958 --- A critical power situation inspires production of the country’s first
transformers.
1963 ---- The patient of breakdown continues. DC motors and DC generators roll off the
assembly line.
1965 ---- Market demand increases. India’s first motorized gear unit joins the K.E.C
product range.
1966 ---- Intensive research and development sets the pace for production of the first
induction heating equipment.
1973 ---- First oversees office at Malaysia.
1976 ---- Office at Nairobi established.
1982 ---- New collaborations. Better products. Thyristor, Converters, made in
collaboration with Thorn EMI, U.K.
BABASAB PATIL 11
ANALYSIS OF FINANCIAL STATEMENT
1987 ---- Introduction of CNC systems and factory automation.
1989 ---- More collaboration. More products. With Fuji of Japan for investors and with
Toshiba of Japan for UPS
1991 ----Toyo Denki collaboration for motors and generators up to 10MW/ MVA.
Production of technologically advanced large DC motors and large AC machines in
collaboration with AEG Daimler Benz of Germany up to 20MW
1992 ---- The company starts production of Hi- Tech CRT based CNC systems.
1993 ---- Kirloskar Electric becomes the first company in India to receive ISO 9001
certification for its entire product range and for all its manufacturing units.
1995 ---- Took over Voltas Transformer and started manufacturing plant at Tumkur for
Manufacturing units
1996 ---- Celebrated Golden jubilee and started manufacture of wind turbine.
2001 ---- Company restructure.
2002 ---- First test lab was started at Tumkur.
2003 ---- Received NVLAP certificate test lab.
2004 ---- Customer Excellence Certificate.
BABASAB PATIL 12
ANALYSIS OF FINANCIAL STATEMENT
COLLABORATION
KEC provides the latest technology products to customers. Towards this, it has entered
into collaboration with foreign companies apart from indigenous research and
development efforts. Some of the major collaboration is:
AC induction motors ---- AEG, Germany
AC generators ---- AEG, Germany
Cast resin transformer ----- OCREV, Italy
Inverters ----- Fuji Electric, Japan
Vector control inverters ---- University of Wuppertal, Germany
Uninterruptible power systems ---- Toshiba Corporation, Japan
CNC Controls ---- ADOLPH numerical controls.
Ltd, UK
Transformers ---- Peebles Electric Ltd.
Wind turbine generators ---- Wind energy group, UK.
BABASAB PATIL 13
ANALYSIS OF FINANCIAL STATEMENT
K.E.C. UNITS
Units Place Products
Unit - 1 Bangalore AC motors, AC generators, motorized gear units.
Unit – 2 Hubli AC motors, AC generators, motorized gear units.
Unit – 3
Recently
Closed
Peenya DC motors, generators, traction.
Unit -4 My sore Industrial electronic group- thyristor
devices, static invertors, UPS systems.
Factory automation group- digital
readouts, CNC systems, Servo drives and
induction heaters.
Unit – 5
Recently
Closed
Bangalore Transformers.
Unit – 6 Pune Automation electric equipments, small range
induction motors and alternators up to 5 HP.
Unit – 7 Tumkur Stampings, Die cast rotors/ bodies and coils.
Unit – 8 Pune Cast resin, transformers, and oil filled
transformers.
BABASAB PATIL 14
ANALYSIS OF FINANCIAL STATEMENT
ORGANISATION SET UP OF KEC
Board of Directors manages KEC Unit II. Mr. Vijay Kirloskar is the Managing Director and Chairman. Under the managing director, there is an Executive Vice- President. A chief executive manages each of this unit.
BOARD OF DIRECTORS
Vijay Kirloskar : Chairman and Managing Director
Agarwal. S.N : Director
Anil Kumar Bhandari : Director
Sarosh. J. Ghandy : Director
Mythili Bal Subramanian : IDBI Nominee
Ramesh. D. Damle : LIC Nominee
Malik. P.S : Dy. Managing Director
Venkatesh Murthy. D.R : Director Sales & Marketing
Company Secretary : P. Y. Mahajan
Auditors : B.K.Ramdhyani & co. Bangalore
BANKERS
1. Bank of Baroda
2. Bank of India
3. State bank of India
4. State bank of Mysore
5. State bank of Travancore
6. Standard Chartered Bank
7. The Hong Kong & Shanghai Banking Corp.
BABASAB PATIL 15
ANALYSIS OF FINANCIAL STATEMENT
REGISTERED OFFICE
Industrial Suburb, Rajajinagar
Bangalore – 560010
FACTORIES
1. Belvadi Industrial Area, Mysore
2. Gokul Road, Hubli
3. Hirehalli, Tumkur.
BABASAB PATIL 16
ANALYSIS OF FINANCIAL STATEMENT
K.E.C UNIT –II
The K.E.C Unit – II, Hubli was founded on 2nd march 1969 and is situated on Gokul road,
Hubli- 580030. It covers 110 acres, which presents a gigantic picture. K.E.C Unit-II is
also known, as KAYTEE SWITCHGEAR LTD. is a subsidiary unit of K.E.C. It is
mainly concerned with production whereas K.E.C looks carries out all other activities.
The main branch is at Bangalore. The board of Directors at Bangalore formulates all the
policies and plans.
Kaytee switchgear Ltd. has been set up under the Arrangement Scheme U/S 391- 394 of
Company’s Act 1956, which has been approved by the honorable High Court of
Karnataka. Certain specified assets and liabilities of K.E.C have been transferred to KSL.
Thus KSL has come into existence from 4th August 2003.
KSL has been brought into existence to over come financial problems which are the
results of accumulated losses of 30 crores because of heavy competition. Performance of
K.E.C has been disappointing as concerned to the financial year 1997-1998. This unit is
the only one unit that seems to be contributing to the profits in terms of turnover, which is
the highest among all over units of K.E.C group. The production activity is carried out
throughout the year in this unit.
BABASAB PATIL 17
ANALYSIS OF FINANCIAL STATEMENT
QUALITY POLICY
The quality price of KEC shall be to design, manufacture and market at
competitive prices, products of such quality, which results in customer satisfaction,
quality reputation and market leadership.
MISSION
To remain a leading produce of electrical technology products in India.
To continuously grow in our business and become a significant player in the
world market.
To maximize return on investment.
To achieve international levels of excellence in technology and quality.
VALUES
Products of highest technology and quality.
Customer orientation
Teamwork among our people.
Profits for growth
GUIDING PRINCIPLES
Innovate continuously to excel in design and manufacturing.
Development products required by market.
Manufacture products of highest quality
Focus on customer in all actions.
Respond promptly to customer needs.
Deliver supplies on time every time.
Treat each other with trust and respect to build a team.
BABASAB PATIL 18
ANALYSIS OF FINANCIAL STATEMENT
Develop people by training and delegation.
Adopt process-oriented thinking, continuous improvement, and management by
facts priority.
Reduce costs constantly to remain competitive.
Earn enough profits to fund growth and diversification.
Offer goods and services at competitive prices.
Look upon dealers, suppliers and business associates as partners.
Maintain safe, clean and healthy environment.
Conduct business in a socially responsible manner.
HOD’S OF KIRLOSKAR ELECTRIC CO.LIMITED,
UNIT-II
CEO - K.S.S.PANIKAR
PERSONNEL - U.PARAMESHWARA
PRODUCTION - A.B.JOSHI (SHOP III),
- D.S.WODEYAR (SHOP III),
FINANCE - K.SHRIDHAR
MARKETING - V.RAMPRASAD
ENGINEERING - D.A.DESAI
MMD - ASHOK KADAKOLI
MED & MSD - S.V.PUROHIT
CEN.PLANNING - A.B.JOSHI
BABASAB PATIL 19
ANALYSIS OF FINANCIAL STATEMENT
ORGANISATION STRUCTURE OF KEC UNIT II
HUBLI
BABASAB PATIL
Chief Executive
Deputy General Manager
Production Department(Senior Manager)
Finance Department(Senior Manager)
Central Planning(Assistant Manager)
Stores(junior Manager)
Engineering Department(Senior Manager)
Quality Assurance Department(Senior Manager)
Marketing(Deputy Manager)
M.M.D(Assistant Manager)
20
Personnel Department(Senior Manager)
ANALYSIS OF FINANCIAL STATEMENT
MANPOWER IN KEC UNIT-II
Human Resource Total MembersDaily rated employees (DRE’s) From grade 1 to 8
432
Monthly rated employees (MRE’s) From grade 1 to 7
45
Officers, Engineers and above From grade 8 to 16
85
Total 562AS on 01-05-2007
Table: 1
Besides these permanent employees, around 81 trainees are recruited and contract Labour
are hired only for some specific purposes and in never employed in production or feeder
shops.
Officer’s cadre is divided into 2 categories.
1. Junior officers from the grade from 5 to 7
Junior officer 1: Grade 5
Junior officer 2: Grade 6
Junior officer 3: Grade 7
2. Senior officers from the grade from 8 to 9
Officer: Grade 8
Senior Officer: Grade 9
The manager cadre is classified as follows from grade 10 to 16
Assistant Manager - Grade 10
Deputy Manager - Grade 11
Manager - Grade 12
Deputy Senior Manager - Grade 13
Senior manager - Grade 14
Deputy General Manager - Grade 15
General Manager - Grade 16
BABASAB PATIL 21
ANALYSIS OF FINANCIAL STATEMENT
PRODUCT PROFILE
AC Generator AC motor
`
DC Motor Traction Equipment
We design and manufacture our products according to the standards of :
ISO (International Organization for Standardization)
IEC (International Electro technical Commission)
BIS (Bureau of Indian Standards)
BSI (British Standards Institution)
JEM(Japan Electrical Manufactures Association)
BABASAB PATIL 22
ANALYSIS OF FINANCIAL STATEMENT
PERSONNEL DEPARTMENT
K.E.C, company recognizes its employees as its most important asset for its continued
growth. Human resources management in Kirloskar Electric Company shall striver to
ensure continuous organizational growth by nurturing the strengths of its employees and
providing the environment and opportunity for every individual to rise to his/her highest
potential, identity and achieve his/her personal goal within the framework of
organizational, social and natural objectives. To achieve this following sections are
formed to perform the various functions including, Positive Motivation, Preparation and
maintenance of quality plans with aid of systems, procedures and work instructions
published collectively in quality manuals.
Scope: Personnel Department is applicable to personal welfare safety and security.
Responsibility of Personnel Department:
Implementation and maintenance of various functions is the responsibilities of the Head
of Department (HOD) with appropriate duties assigned to section in charges (SIC) and
staff.
Functions:
The Main functions of Personnel Department are:
HOD-PERSONAL AND INDUSTRIAL RELATIONS:
To ensure that harmonious relations exists between workers and management
To ensure safe working conditions and to provide safety equipments.
To Co-ordinate security and vigilance activities
Manpower planning accountability.
BABASAB PATIL 23
ANALYSIS OF FINANCIAL STATEMENT
ORGANISATION CHART OF PERSONNEL DEPARTMENT
BABASAB PATIL
HOD
SIC TRAINING IN CHARGE
CANTEEN
DEPARTMENT ASSISTANT
SECURITY OFFICER
WELFARE OFFICER
IND.REL OFFICER
AMBULANCE ROOM
TIME OFFICE I.C
24
ANALYSIS OF FINANCIAL STATEMENT
MARKETING DEPARTMENT
Success of any product totally depends on HO it is marked and positioned din the
market. Marketing department is on of the important functional divisions of KEC UNIT-
II, which is basically, identifies and meets the needs of customers profitably. The people
in the marketing department are responsible for the growth of a business concern because
they come in direct contact with the customers who now are considered as King of the
market as it is a buyers market and no more a sellers market.
As marketing departments basic principle is to take care of the customers to
achieve way they have divided their department in to there sections such as :
Marketing
Customer Service
Communication
Marketing is further having its subgroups i.e. technical group, which does the job of
tendering or equally handling Execution, is planning group.
The network of marketing department has all over India at 28 branches known as sales
office/branches.
The function of this division in K.E.C UNIT-II starts to determine the needs of the
customers their documents concurrently then accurately to communicate then to various
departments.
Marketing:-
When a branch office in any part of its network receives an order in case of special
product (i.e. as per customer requirements) it sends an order acceptance copy i.e. duly
verified by the sales engineering of that branch to the tendering group where this OA
copy is examined and sent to planning department and further forwarded engineering
department for design and development of special product who prepares its engineering
BABASAB PATIL 25
ANALYSIS OF FINANCIAL STATEMENT
specification and sends it to the purchase department if any new or additional
components are regard to the production department. The marketing department based on
the demand contacts the materials management department issues materials on the
amount and the type of material, which required. Based on the amount required the
department based on the demand contacts the materials management department issued
materials on the amount required the production scheduling, routing and the like has to be
carried out.
K.E.C UNIT-II is planning turnover is 100 crores for last year achieved to the 84
crore. This planning for turnover is 110 crores.
AC-Generator Marketing:-
In case of AC-Generator the final customer is directly purchase through
Manufacture of Branch office or Dealer.
The O.E.M. (Original Equipment Manufactures) who in turn places the purchase
order to the branch office, The order acceptance form along with desired specifications is
studied. Carefully in the marketing department and if found possible for production is
immediately informed to the O.E.M the information is also forwarded to the production
units
AC Motor Marketing:-
The customer decided the rating of a motor required and approaches to the dealer,
the dealer in turn acceptance and passes it on to the branch office which prepares an order
acceptance and passes to customers and another to the unit of the production otherwise
customer is directly contact through the marketing department.
BABASAB PATIL 26
ANALYSIS OF FINANCIAL STATEMENT
The order acceptance is then separated into the one for standard products and
other for special products. The special products requirements have to be discussed with
the engineering department and then accepted.
CREDIT POLICY:
Generally K.E.C-II does not follow the policy. But some times the credit is issued
to a particular customer depending on the volume of the purchase, the type of a customer
K.E.C UNIT-II has a credit policy extending to a maximum of 30 days.
Objectives:
The objectives of marketing department are to achieve customer satisfaction with
quality products, price, and delivery in time, and presale service after sale service,
maintain brand image and earn profit for further diversification.
COMPETITIORS
1. Organized sector
BHEL
ASEA
Crompton Graves Ltd.
Bharat Bijli ltd.
Asian Brawn Boweri Ltd (ABB Ltd.)
General Electrical Company Ltd.
Jyoti Ltd.
Unorganized Sector:
Mainly cottage industries.
Direct Customers.
OEM’s (Original Equipment Manufacturer’s)
OEA’s (Original Equipment Assembler’s)
Government organization (Railway, Airports)
BABASAB PATIL 27
ANALYSIS OF FINANCIAL STATEMENT
Indian Defense
Indian Railways
Other Industries
ORGANISATION CHART OF MARKETING
BABASAB PATIL
GROUP ACM SIC WEST AND EAST JMU
SIC NORTH AND SOUTH RNA
SIC PING & EXECN RPK
FIC GKN
SIC AKN
SIC PING & EXEN SGM
GROUP ACG
HOD MARKETING
28
ANALYSIS OF FINANCIAL STATEMENT
MATERIAL MANAGEMENT DEPARTMENT
Objectives:
To provide components can service for manufacturing as required by others
functional divisions.
Scope:
To plan and procure materials confirming to specifications through adequate
selection of sub contractor.
To feed the materials to the production division at required schedules at an
economic cost.
Functions:-
Work out material requirement based on sales requisite plan (SRP), Sales
constancy plan (SCP) and Critical credit requirement (CCR)
To exercise purchase order as per procedure.
To plan for non-production item based on purchase requisitions to materials
management division.
To finalize terms of purchase.
Job Description and Responsibility
To maintain and direct the organization, which is adequate to perform material
management functions.
To define the duties and responsibilities of MMD and to ensure that they carried
out effectively.
To plan for realistic purchase budget.
To manage obsolete surplus and scrap material.
SIC’S:
To plan the material requirement
To order material and on approved suppliers and supply in the quantity necessary
to satisfy marketing requirement.
BABASAB PATIL 29
ANALYSIS OF FINANCIAL STATEMENT
To monitor the material recipient as per delivery schedule indicated in purchase
order and co-coordinating with supplier.
To monitor the material release for production in accordance with SRP/SCP/CCP.
FIC’S
To plan the materials requirement.
To order material and on approved supplied and supply in the quantity necessary
to satisfy marketing requirement.
To monitor the material release for production in accordance with SRP/SCP/CCP
To follow with supplier for supplier for supplying, required material at required
time of manufacturing.
To keep the manufacturing division and other functional divisions other than the
manufacturing informed of related activities to facilitate overall coordination
related activities include information regarding material availability supplier
training programs reasoning for user training for supplier products etc.
To determine the need of stock replacement through use of daily material receipt
perpetual inventory.
To monitor and reconcile materials issued to suppliers.
BABASAB PATIL 30
ANALYSIS OF FINANCIAL STATEMENT
ORGANIZATION CHART OF MMD
BABASAB PATIL
CEO HOD MMD
ACM S3
SIC SHOP3
OFFICE ASSISTANT
SIC SHOP V ACG
FIC EXECUTIVE SHOPS
31
ANALYSIS OF FINANCIAL STATEMENT
FINANCE DEPARTMENT
Finance department is the blood of any business organization to survive. Any
organization handicapped by finance will never complete an ultimately results in failure
and a burden to economy. Finance department is concerned with planning and controlling
of company financial resources.
The company policy is formulated and credit worthiness of the customer is evaluated
audits such as cash audit, internal audit, cost audit is done per month. In the finance
department of KEC UNIT-II, there are 26 staff members contributing towards the
effective functioning of the department.
ORGANISATIONAL HIERARCHY OF FINANCE DEPARTMENT
BABASAB PATIL
CORPORATE FINANCE
CHIEF EXECUTIVE
GRADE 8 AND ABOVE
M.R.E’s up to GRADE 7
32
ANALYSIS OF FINANCIAL STATEMENT
KEC UNIT-II, is characterized by the fact that all the collaboration are sent to corporate
office at Bangalore and the expenditure of the particular day are sent to the unit as per the
requirement of the units.
FUNCTIONS:-
FINANCING FUNCTIONS
It includes cash payments, receipts, bank receipts and payments.
CREDIT MANAGEMENT:
Due to the competition, now a day’s credit is a means to achieve the target without credit
sale any organizational can fulfill their targets.
COSTING
Costing relates to calculation of production cost per unit and it tries to minimize the cost
of production and helps in the function of pricing with marketing department.
AUDITS:-
Audit is a way to confirm about the accountancy of the functions and records of all over
activities. It has employed cost Audit and Internal Audit etc.
RECORDING AND MAINTAINING OF ACCOUNTS:-
These are the present and future reference of the company’s financial position. These are
useful for Shareholders, Creditors, Suppliers, and Bankers etc.
BANKERS OF K.E.C UNIT-II
K.E.C UNIT-II has the following Bankers:
1. Bank of Baroda
2. Bank of India
3. Canara Bank
4. Hong Kong Bank
5. State Bank of India
6. State Bank of Mysore.
BABASAB PATIL 33
ANALYSIS OF FINANCIAL STATEMENT
Financial Institutions:
Following are the financial Institutions of K.E.C UNIT-II:
1. Industrial Credit & Investment Corporation of India (ICICI)
2. Industrial Development Bank of India (IDBI)
3. Unit Trust of India (UTI)
K.E.C UNIT-II production per month is worth 10 crores. But now it attempting to
rise to Rs 11 to 11.5 crores, the raw materials is steel and copper. These are
procured from steel Authority of India Ltd., and Hindustan Copper Ltd. 1% of
the total turnover is used for welfare expenses and 6% of total turnover is
used for salary or expenditure.
On an average the KEC Unit-II is paying Rs.150 lakhs as excise duty/month, 6% of
total turnover is given as salary and 1% of the total turnover is spent on welfare activities.
The method of depreciation followed is straight-line method. The company has adopted
FIFO method for costing.
Listing on Stock exchanges:
Bangalore Stock Exchange Ltd., (KIRELECRRI)
Madras Stock Exchange Ltd.(KRL)
BABASAB PATIL 34
ANALYSIS OF FINANCIAL STATEMENT
ENGINEERING DEPARTMENT
Quality Policy of Engineering:
The quality policy of K.E.C UNIT-II shall be continuously improving the quality
management system in design, manufacture, market and service at competitive prices.
Product of such quality, resulting in customer satisfaction, quality, reputation and market
leadership, The role of engineering department is to design and develop products and
components taking into consideration the cost, product ability, usability, and maintenance
of the product.
Scope:
Applicable to quality objectives identified for improvement in design and
development of products manufactured in KEC UNIT-II.
Responsibility:
The head of the engineering department is responsible for receiving the objectives.
Procedure:
Objectives shall be derived from the organizational quality policy and need to
meet customer and product requirement.
Quality objectives by engineering department will lead to
Simplification in design
Standardization of components
Reduction in reworking of design
Reduction cost of production.
For achieving or reworking quality objectives appropriate statistical quality
control technique shall be used.
Functions:
Preparation revision and release of engineering and electrical specifications.
Preparation, revision and control of drawings and release of material risk.
Validation of design of products.
Effective implementation of the design changes.
PRODUCTION DEPARTMENT
BABASAB PATIL 35
ANALYSIS OF FINANCIAL STATEMENT
In many manufacturing unit production department forms the most important
department of all the whole running of the unit depends upon this department the proper
and timely functioning of this department helps in products reaching the customers end at
right time. Slight difference in timing and quality upsets the cycle. Thus the production
department we can say is the heart of the firm.
K.E.C UNIT-II philosophy has always been to excel in what one knows best in
the process of development. KEC UNIT-II has laid great emphasis on adopting
technology to suit the environment in which it has to operate K.E.C UNIT-II’s production
process are continuously of upgraded from time to time by the latest technology.
Objectives:
To follow up the production schedule as per the plan.
To maintain the close and coordinated relationship with other department.
To upgrade technical efficiency of production.
K.E.C UNIT-II there is six shops in this department all of which have got
different functions to perform. The product moves from first to sixth shop and
then to the dispatch.
H.O.D Production heads the production department with a total shop of 600.
The whole shop is divided into among six shops.
The department is divided into 2 groups.
1. Feeder shop (Shop I and Shop II)
2. Assembly Shop (Shop III and Shop V)
3. Shop IV is used as Research and Development Center is also called as
“Invotech Center” and Shop VI is painting section.
Brief description of shops:
BABASAB PATIL 36
ANALYSIS OF FINANCIAL STATEMENT
SHOP I:
The matching functions are carried out in this shop which has 5 lines engaged in
production namely welding section, sub assembly, labor section, tools and jigs crib and
tool room.
There are totally 80 machines and 100 workers in shop I. The raw materials
arrived in this shop where the metal drilling, milling and shaft fixing is done and sent to
the next process. The winding are also done in the shop I.
Here the process of Bodies – KH 100 to LD 225 frames.
Covers – KH 63 to LD 225 frame.
Shaft – KH 63 to LD 180 frame.
Gear cases – MGH 100 to MGH 225 frame.
Gears/pinions for Geared motors are done and also undertake manufacturing JIGS and
FIXTURES and DIE-CASTING dies.
ROTOR SUB ASSEMBLY:
Rotor is the static part in the ACM’s and dynamic that is moving in the ACG’s.
The rotor goes through the following process.
1) Sinking:
The roots are treated in the solution for convenience of inserting the shaft so that
they expand and make it easy for insertion of the shaft.
2) Turning:
The correct turning and made according to the specification.
3) Fan Shop Drilling:
This is the process where in the fan is to be fixed and for this purpose drilling is
done and then locks are fixed for safety.
4) Balancing:
This step involves balancing the rotor properly.
BABASAB PATIL 37
ANALYSIS OF FINANCIAL STATEMENT
WINDING:
Winding is the most important functional part of the machine. It has to be done
manually and precisely. This is the only process, which is totally manual. The motor is
wound with correct rating wires.
SHOP II
Shop II is die cast shop. Here in this shop only die-casting is done. That is the
shapes of body and nameplates final shape. The shop II has two machines, one for
nameplate pressing and another for body.
It houses the router section, here stampings are received and die casting of the
metal stamping is carried in a furnace heated at 675 degrees Celsius 755 degree Celsius
ROTOR SECTION:
Here processing of rotor sub assembling for KH 63 to 180 frames, SD 71 flange
machine is undertaken.
DIE-CASTING SECTION:
Here die-casting for motor for 63 to 225 frame motors and die-casting of bodies,
flanges, covers, and terminal boxes from KH 63 to 10 frames.
SHOP-III
This shop can be called as assembly shop because the products here will get upto
90% only, final finishing will be at this stage.
The assembling of motors of the frame size motors are assembled in this shop in
three different assembly lines namely:
The non-standard line for custom mode and is operated manually.
The standard line for this standard motor is also called verticals assembly line
where the motors are assembled mechanically by various stations in the machines
acquired for the specific purposes.
The export line is where the motors have to be exported assembled with due care
and is done manually. After assembling the motors they are sent to the painting
section, which is housed in the same shop.
BABASAB PATIL 38
ANALYSIS OF FINANCIAL STATEMENT
SHOP IV:
It works as research and development center for the company. It keeps its eye on
the changes that are taking place in the electrical world and tries to adopt those
changes in their manufacturing process. So it acts as research and development in the
company.
SHOP V:
Here assembling of medium and large motors generators and MGU’s under
separate bays like ACM bay, ACG bay and MGUU bay.
Product Rating
A.C Motors Frame 200 to 225 15 KW to 75 K W
A.C Generator Frame and
180 & 250
DS-DL-CMA 2.5KVA to 90KVA
Motorized gear units 90 to 225 0.75 KW to 22 KW
Painting and testing is also done here.
SHOP VI :
In this section, components used in the motors are pre treated and painted.
K.E.C UNIT-II has to its credit the pioneering of the latest technology called
“Unibake” system. Earlier this system was applied to all the products but recently it has
been restricted only for export orders. The domestic products are painted in conventional
manner.
BABASAB PATIL 39
ANALYSIS OF FINANCIAL STATEMENT
ORGANISATION CHART OF FEEDER SHOPS
K.E.C has its corporate and marketing office at Bangalore. National Offices are divided
into 4 zones.
1. North Zone : Delhi, Ludhiana, and Jaipur
2. East Zone : Kolkatta, Jamshedpur, Guwahati, Bhubaneshwar and Ranchi.
3. West Zone : Mumbai, Nagpur, Pune, Ahmedabad, Surat and Indore.
4. South Zone : Chennai, Coimbatore, Cochin, Hyderabad, Bangalore, Belgaum,
Pondichery
BABASAB PATIL
CEO
HOD Production
SIC – FEEDER SHOPS
FIC, T ROOM AND T CRIB
FIC, Shaft Body
FIC DIE CASTING
FIC SHOP6
40
ANALYSIS OF FINANCIAL STATEMENT
QUALITY ASSURANCE
Quality is the fitness to end-use, it is all persuasive. In this modern and
competitive world each and every company is trying hard to introduce to quality and
every defect free product K.E.C has a full fledge quality assurance department headed by
highly qualified professionals committed to developing products that keep phase with the
changing desires and needs of the consumers. Quality plays important role in K.E.C
UNIT-II because its products are used for industrial customer applications. Hence it must
satisfy and come upto the customer expectations.
Objective:
The role of QA division is to assist all functional division in achieving and
maintaining level of specified quality requirement economically.
This unit being ISO-9001, certified unit, has to follow the stringent quality
specification. This department facilitates the total quality management (TQM) in all the
departments, by adopting process controls at all stages.
The quality assurance department follows a definite set of systems and
procedures, which are incorporated in the manuals. The manuals are drafted to the lines
of the standards as specified by the ISO-9000 series of clause for quality documentation.
Functions:
The functional responsibilities of different sections of QA divisions are as follows:
Releasing of accepted products for further process.
Evaluating quality rating of suppliers.
Generation of NC reports for analysis/ review and initiating corrective action and
preventive action.
Quality information and reporting.
Maintaining documents and records as per procedures.
FEEDER SHOPS QA:
Feeder shops QA is responsible for:
BABASAB PATIL 41
ANALYSIS OF FINANCIAL STATEMENT
Inspection/ Testing of parts, sub assembly as per appropriate quality plan/
documents procedures/ inspection plans other documents.
Ensuring proper identification and inspection status.
Updating, revising inspection plans procedure as and when found necessary.
Generation of Non-conformance reports for analysis, revive and collective action,
preventive action.
Ensuring that calibrated instruments are used for measurements and coordinating
with calibration section for periodic calibration.
FINAL INSPECTION AND TESTING
Conduction routing/ type/ engineering tests on products to specified requirements as per
documented procedures:
Maintaining test records and providing test certificates.
Ensuring tested products and conforming to specified requirements and complete
in all respects.
Providing inspection/ tests stating for confirming products.
Providing engineering test results for design modification where necessary.
Assisting in customer inspection.
QUALITY LABORATORY:
Periodic calibration of instruments as per documented process.
Arranging for repair/ rectification/ disposal of measuring instruments.
Planning for new instruments/ organizing calibration function from external
agencies.
Maintaining documents/ records as per procedures.
QUALITY SYSTEMS:
Maintaining quality systems as per ISO 9001-2000
Assisting HOD QA for conduction quality related training programs.
BABASAB PATIL 42
ANALYSIS OF FINANCIAL STATEMENT
Analysis and reporting of customer complaints internal non-conformance
reports.
Conducting systems audits, monitoring corrective actions, preventive actions.
Implementing of corrective actions and preventive actions.
Interpretation: - The ratios are increasing year by year. In 2006-07, it is 4.25and it has
been increased to 4.5 in 2007-08. The ratio is not so high. It shows that the payments of
debtors are not so prompt. It is less standard ratio i.e. 8 times.
BABASAB PATIL 72
ANALYSIS OF FINANCIAL STATEMENT
Debtors Collection Period :
Formula:
Debtors collection period ratio= Debtor*360/sales
Table-12 (Amount in lakhs)
Year 2004-05 2005-06 2006-07 2007-08
Debtor 8,25,008 11,26,390 13,78,923 15,98,625
Sales 31,20,434 41,40,246 59,13,957 72,77,768
Debtors
Collection
Period
95 98 84 79
SOURCE: ANNUAL REPORTS OF COMPANY
Interpretation: - The collection period of KEC is not good
BABASAB PATIL 73
ANALYSIS OF FINANCIAL STATEMENT
ASSETS TURN OVER RATIO: Asset turn over ratio indicates Sales for every one rupee which is invested in
fixed and current asset together. Assets are used to generate sales. A firm should manage
its efficiently to masculine sales.
Formula: Asset turnover ratio= Sales/ Net Asset
Table-13 (Amount in lakhs)
Year 2004-05 2005-06 2006-07 2007-08
Sales 31,20,434 41,40,246 59,13,957 72,77,768
Net Asset 15,39,264 18,56,702 25,25,498 32,92,946Asset turn over ratio
2.0 2.2 2.3 2.2
SOURCE: ANNUAL REPORTS OF COMPANY
Interpretation: The total asset turn over ratio is 2.3 times in the year 2006-07 it is good.
The same is maintained in year 2005-06, 2007-08. In the 2004-05 the ratio is low. It
indicates poor perform.
BABASAB PATIL 74
ANALYSIS OF FINANCIAL STATEMENT
FINDINGS:
The important findings of the study are as follows.
1) Cash ratio of the company is poor hence they will find problem of liquidity
position.
2) The debtor’s collection period of kec is not good.
3) The quick ratio of kirloskar electric limited is showing a increasing trend & it is
also below the standard ratio 1:1.
4) The current ratio of kirloskar electric limited is not satisfactory but it is below the
standard ratio i.e. 2:1.
5) Debt equity ratio of the company is far below the standard. They have not utilized
the potential of borrowing for the debts.
6) In the kirloskar electric limited the creditors are paid promptly.
7) The company maintains a co-operation among the staff member & management.
8) On an average all together other ratios are normal.
9) As per order given by the customer supply manufacture products to them at right
time & at right places.
BABASAB PATIL 75
ANALYSIS OF FINANCIAL STATEMENT
SUGGESTIONS:
1) Company should try to maintain its current ratio at the standard 2:1.
2) The company should reduce its cost of production through adopting new
technology. It will help to increase the sales.
3) The kec’s average collection period is very high. For avoiding the company
should take major techniques to collect the money from debtors.
4) Company should try to reduce its credit sales through cash discount at the time of
sales. It will helps to meet the current obligation.
5) Company is suggested to maintain sufficient amount of cash & bank balance to
pay its quick liabilities, which will increase its credit worthiness & goodwill.
6) The company is in loss due to heavy interest burden to avoid this the company
should plan to adoption of share capital in the business.
7) The company should conduct weekly meetings for central planning, material
management department, and production department towards operations of the
company.
8) The company should conduct monthly meetings to knowing its performance. If
the performance is not reached then it will helps to take necessary decisions.
BABASAB PATIL 76
ANALYSIS OF FINANCIAL STATEMENT
CONCLUSION:
Financial statements plays very important role in providing facts and figures for
the decision makers. In the same way ratios will act as analysis kit in the hands of
financial analyst. These ratio will help us and in answering the basic question like why,
how, what of these statements.
Now a days financial statement are very much in consideration for decision
making. In deciding what to do and what not to do they are required to analyze the data
as per their requirement. Thus in our project we try to give brief outline of ratio analysis
(i.e., how to analyze the facts and figures given in the financial statements) form the
angle of all stake holders.
Throughout my project I have analyzed company’s financial position and pros and
cons of the situation and we have also interpreted the data. In spite of some limitation we
try to analyze and interpreted the facts and figures with accuracy.
Based on the analysis and interpretation I tried to give my findings and suggestions
for the company as per my best knowledge.
Finally project really helps us in knowing the practical things of the corporate world.
Really I enjoyed this project work in its real spirit.
BABASAB PATIL 77
ANALYSIS OF FINANCIAL STATEMENT
ANNUAL REPORT 2004-2005BALANCE SHEET AS AT 31ST MARCH 2005
(Rs. in lakhs) Schedule As At 31st March 2005 As At 31st March 2004
SOURCES OF FUNDS SHARE HOLDERS FUNDS a) Capital b) Reserves & Surplus
AB
432,688675,541
432,688787,205
1,108,229 1,219,893LOAN FUNDS a) Secured Loans b) Unsecured Loans
CD
201,0012,129
303,5252,895
203,121 3,06,420TOTAL 1,311,350 1,526,313
======= ======== APPLICATION OF FUNDS FIXED ASSETS a) Gross Blockb) Less : Depreciation c) Net Block d) Capital work in progress (at Cost)
E 389,739262,273
127,46658,666
612,328301,444
302,88459,511
186,122 362,395
INVESTMENTS F 655,951 583,531
CURRENT ASSETS, LOANS & ADVANCES
a) Inventoriesb) Sundry Debtorsc) Cash & Bank Balanced) Loans & Advances
G 127,529825,008217,773241,488
126,729637,630348,375179,554
1,411,798 1,292,288
LESS : CURRENT LIABILITIES & PROVISIONS
a) Current Liabilityb) Provisions
H 1,273,12412,979
1,319,59410,932
1,286,103 1,330,526NET CURRENT ASSETS 125,695 (38,238) MISCELLANEOUS EXPENDITURE TO THE EXTENT NOT WRITTEN OFF
I 77,882 132,451
PROFIT & LOSS ACCOUNT 366,690 486,174TOTAL 1,311,350 1,526,313
======= ======== NOTES ON ACCOUNTS NBALANCE ABSTRACT & COMPANY’S OGENERAL BUSINESS PROFILE
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH
2005
BABASAB PATIL 78
ANALYSIS OF FINANCIAL STATEMENT (Rs. in lakhs)
Schedule Current Year Previous Year INCOME Sales Less : Excise Duty Other Income Profit on sale of long term investment Remission of Loan Liability Profit on sale of fixed assets
J
3,203,63783,203 3,120,434
12,573-23,41291,648
2,160,75156,179 2105,572
41,59014,446 -39,094
TOTAL 3,248,067 2,200,702 ======== ======== EXPENDITURE Consumption of raw material, Stores, Spares for & Components and purchasing for trading. Operating and other expenses Restructing expenses Interest & Finance Charges On fixed loans On other accounts
KL
18,7103,832
2,855,858203,968
9,153
15,65412,009
1,907,035 216,899
22,542 27,663Loss on Sale of Fixed Assets Depreciation, Amortisations & Provisions
47,93199,749
25,71666,374
TOTAL 3,239,201 2,243,687PROFIT / (LOSS) BEFORE TAXATIONLess : Provision for Taxation (Net)
8,86646
(42,985)(594)
PROFIT / (LOSS) FOR THE YEAR 8,820 (42,381)Add : Transfer from General Reserve realized portion of revaluation reserve on sale of asset. 111,664 1,256
120,484 (41,135)Less: Loss brought forward from previous year (486,174) 445,039Balance of Loss carried to Balance sheet
(365,590) (486,174)
======== ======== Earning per (face value Rs.10/- per share)Basic Diluted
(0.02)(0.02)
(1.70)(1.59)
NOTES ON ACCOUNTS NBALANCE SHEET ABSTRACT & COMPANY’S GENERAL BUSINESS PROFILE
O
ANNUAL REPORT 2005-2006
BABASAB PATIL 79
ANALYSIS OF FINANCIAL STATEMENT
BALANCE SHEET AS AT 31ST MARCH 2006(Rs. in lakhs)
Schedule As At 31st March 2006 As At 31st March 2005SOURCES OF FUNDS SHARE HOLDERS FUNDS a) Capital b) Reserves & Surplus
AB
432,688675,541
432,688675,541
1,108,229 1,108,229LOAN FUNDS a) Secured Loans b) Unsecured Loans
CD
176,07317,501
201,0012,120
193,674 203,101TOTAL 1,301,803 1,311,350
======= ======== APPLICATION OF FUNDS FIXED ASSETS a) Gross Blockb) Less: Depreciation c) Net Block d) Capital work in progress (at Cost)Less: Provision for Diminution in value
E 380,535261,616
56,3833,056
118,949
389,739262,273
58,666-
127,466
53,327 58,666 172,276 186,132
INVESTMENTS F 600,068 555,951
CURRENT ASSETS, LOANS & ADVANCES
a) Inventoriesb) Sundry Debtorsc) Cash & Bank Balanced) Loans & Advances
G 217,9611,126,390
139,434253,968
119,590825,008217,773105,053
1,737,753 1,267,424
LESS : CURRENT LIABILITIES & PROVISIONS
a) Current Liabilityb) Provisions
H 1,556,25721,250
1,319,59410,932
1,576,507 1,141,729NET CURRENT ASSETS 161,246 125,695 MISCELLANEOUS EXPENDITURE TO THE EXTENT NOT WRITTEN OFF
I 43,823 77,882
PROFIT & LOSS ACCOUNT 324,390 365,690TOTAL 1,301,803 1,311,350
======= ======== NOTES ON ACCOUNTS NBALANCE ABSTRACT & COMPANY’S OGENERAL BUSINESS PROFILE
BABASAB PATIL 80
ANALYSIS OF FINANCIAL STATEMENT
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH 2006
(Rs. in lakhs) Schedule Current Year Previous Year
INCOME Sales Less: Excise Duty Other Income Profit on sale of long term investment Remission of Loan Liability Profit on sale of fixed assets
J
4,281,127140,881 4,140,246
19,7172,992
-6,453
3,203,63783,203 3,120,434
12,573 -
23,41291,648
TOTAL 4,169,408 3,248,067 ======== ======== EXPENDITURE Consumption of raw material, Stores, Spares for & Components and purchasing for trading. Operating and other expenses Restructing expenses Interest & Finance Charges On fixed loans On other accounts
KL
13,9574,074
3,755,750259,89626,585
18,7103,832
2,855,858 203,968
9,153
18,031 22,542Loss on Sale of Fixed Assets Depreciation, Amortisations & Provisions
======== PROFIT BEFORE TAXATIONLess : Provision for Taxation (Net) Provision for fringe benefit tax
45,300-4,000
8,86046
-PROFIT FOR THE YEAR 41,300 8,820Add : Transfer from General Reserve - 111,664
41,300 120,484Less : Loss brought forward from previous year (365,690) (486,174)Balance of Loss carried to Balance sheet
(324,390) (365,690)
======== ======== Earning per (face value Rs.10/- per share)Basic Diluted
(1.10)(0.95)
(0.02)(0.02)
NOTES ON ACCOUNTS NBALANCE SHEET ABSTRACT & O
BABASAB PATIL 81
ANALYSIS OF FINANCIAL STATEMENT COMPANY’S GENERAL BUSINESS PROFILE
ANNUAL REPORT 2006-2007
BALANCE SHEET AS AT 31ST MARCH 2007(Rs. in lakhs)
Schedule As At 31st March 2007 As At 31st March 2006SOURCES OF FUNDS SHARE HOLDERS FUNDS a) Capital b) Share application money Pending allotment c) Reserves & Surplus
A
B
432,68860,000
675,541
432,688-
675,5411,168,229 1,108,229
LOAN FUNDS a) Secured Loans b) Unsecured Loans
CD
244,29472,049
176,07317,501
316,343 193,574TOTAL 1,484,572 1,301,803
======= ======== APPLICATION OF FUNDS FIXED ASSETS a) Gross Blockb) Less: Depreciation c) Net Block d) Capital work in progress (at Cost)
E 364,906249,055
56,383115,851
380,565261,616
56,383118,949
Less : Provision for diminution in value 46,05610,327 53,327
126,178 172,276INVESTMENTS F 584,752 600,068
CURRENT ASSETS, LOANS & ADVANCES
a) Inventoriesb) Sundry Debtorsc) Cash & Bank Balanced) Loans & Advances
G 229,7271,378,923
413,668387,329
217,9611,126,390
139,434253,968
2,409,647 1,737,753LESS : CURRENT LIABILITIES & PROVISIONS
a) Current Liabilityb) Provisions
H 1,763,76641,434
1,555,25721,250
1,805,200 1,576,507NET CURRENT ASSETS 604,447 161,246 MISCELLANEOUS EXPENDITURE TO THE EXTENT NOT WRITTEN OFF
I 19,751 43,823
PROFIT & LOSS ACCOUNT 149,444 324,390TOTAL 1,484,572 1,301,803
======= ========
BABASAB PATIL 82
ANALYSIS OF FINANCIAL STATEMENT NOTES ON ACCOUNTS NBALANCE ABSTRACT & COMPANY’S OGENERAL BUSINESS PROFILE
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH 2007
(Rs. in lakhs) Schedule Current Year Previous Year
INCOME Sales Less : Excise Duty Other Income Profit on sale of long term investment Profit on sale of fixed assets
J
6,186,711272,754 5,913,957
24,277-
615
4,281,127140,881 4,140,246
19,7172,9926,453
TOTAL 5,938,849 4,169,408
======== ======== EXPENDITURE Consumption of raw material, Stores, Spares for & Components and purchasing for trading. Operating and other expenses Restructing expenses Interest & Finance Charges On fixed loans On other accounts
KL
22,33311,567
5,309,337288,900-
13,9574,074
1,907,035 216,899
33,900 18,031Loss on Sale of Fixed Assets Depreciation, Amortizations & Provisions
======== ======== PROFIT BEFORE TAX & EXTRAORDINARY ITEMS Add: Extraordinary Income – remission of Liability
183,640
7,806
45,300
-
PROFIT BEFORE TAXATION 191,446 45,300Less : Provision for current tax 10,000 - Provision for fringe benefit tax 6,500 4,000PROFIT FOR THE YEAR AFTER TAX 174,946 41,300Less : Loss brought forward from previous year
(324,390) (365,690)
BALANCE OF LOSS CARRIED TO BALANCE SHEET
(149,444) (324,390)
======== ======== EARNING PER SHARE (face value Rs.10/- per share) Before considering extraordinary items. Basic Diluted
5.034.73
1.010.95
After considering extraordinary items. Basic Diluted
5.284.96
1.010.95
NOTES ON ACCOUNTS N
BABASAB PATIL 83
ANALYSIS OF FINANCIAL STATEMENT BALANCE SHEET ABSTRACT & COMPANY’S GENERAL BUSINESS PROFILE
O
ANNUAL REPORT 2007-2008
BALANCE SHEET AS AT 31ST MARCH 2008(Rs. in lakhs)
Schedule As At 31st March 2008 As At 31st March 2007SOURCES OF FUNDS SHARE HOLDERS FUNDS a) Capital b) Share application money pending Allotment c) Reserves & Surplus
A
B
432,688
-799,818
432,688
60,000675,541
1,252,506 1,168,229LOAN FUNDS a) Secured Loans b) Unsecured Loans
CD
332,393108,759
244,29472,049
441,152 316,343TOTAL 1,693,658 1,484,572
======= ======== APPLICATION OF FUNDS FIXED ASSETS a) Gross Blockb) Less : Depreciation c) Net Block d) Capital work in progress
E
F
386,608253,432
133,17130,745
384,906249,055
115,85110,327
163,916 126,178INVESTMENTS G 584,752 584,752
CURRENT ASSETS, LOANS & ADVANCES
a) Inventoriesb) Sundry Debtorsc) Cash & Bank Balanced) Loans & Advances
H 455,8641,598,625
524,749580,537
229,7271,353,438
413,668387,329
3,159,775 2,384,162
LESS : CURRENT LIABILITIES & PROVISIONS
a) Current Liabilityb) Provisions
I 2,131,45483,331
1,735,81243,908
2,214,785 1,779,715NET CURRENT ASSETS 944,990 604,447 MISCELLANEOUS EXPENDITURE TO THE EXTENT NOT WRITTEN
I - 19,751
BABASAB PATIL 84
ANALYSIS OF FINANCIAL STATEMENT OFF PROFIT & LOSS ACCOUNT - 149,444
TOTAL 1,683,658 1,484,572 ======= ======== NOTES ON ACCOUNTS NBALANCE ABSTRACT & COMPANY’S OGENERAL BUSINESS PROFILE
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH
2008
(Rs. in lakhs) Schedule Current Year Previous Year
INCOME Sales Less : Excise Duty Other Income Profit on sale of fixed assets (net)
J
K
7,649,921372,163 7,277,768
57,413216
6,186,711272,754 5,913,957
24,277615
TOTAL 7,337,899 5,938,849
======== ======== EXPENDITURE Consumption of raw material, Stores, Spares for & Components and purchasing for trading. Operating and other expenses Interest & Finance Charges On fixed loans On other accounts
======== ======== PROFIT BEFORE TAX & EXTRAORDINARY ITEMS Add: Extraordinary Income – remission of Liability
272,781
-
183,640
7,806
PROFIT BEFORE TAX EXPENSES Less : Provision for Current Tax (Net) Provision for fringe benefit tax
272,78131,0405,000
191,44610,0006,500
PROFIT AFTER TAX EXPENSES 236,741 174,946Less : Loss brought forward from previous year 149,444 324,390Add : Expenditure on employee benefits upto 31st March 2007 in terms of transitional provisions of AS 15 (revised)
3,020 -
152,464 324,890Balance sheet of profit / (Loss) carried to Balance sheet 84,277 (149,444)
======== ======== Earning per (face value Rs.10/- per share)Before considering extraordinary items
BABASAB PATIL 85
ANALYSIS OF FINANCIAL STATEMENT Basic Diluted
6.926.92
5.034.73
After considering extraordinary items Basic Diluted
6.926.92
5.284.96
NOTES ON ACCOUNTS OBALANCE SHEET ABSTRACT & COMPANY’S GENERAL BUSINESS PROFILE
P
BIBLIOGRAPHY:
M.Y.KHAN, P.K.JAIN (1981), Financial Management, and cost accounting (third
edition) New Delhi: McGraw-Hill Publishing Company Ltd.
I.M.PANDEY, Financial Management New Delhi Vikas Publishing House