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Budget & Budgetary Control Analysis in PepsiCo
PepsiCo is the world's premier consumer Products Company focused on convenience food and
beverages. Co. seek to produce healthy financial reward to investors as they provide
opportunities for growth and enrichment to our employee
PepsiCo India and its partners have invested more than U.S. $1 billion since the company was
established in the country. PepsiCo provides direct and indirect employment to 150,000 people
including suppliers and distributors
The group has built an expansive beverage and foods business. To support its operations,
PepsiCo has 43 bottling plants in India, of which 15 are company owned and 28 are franchisee
owned. PepsiCo’s business is based on its sustainability vision of making tomorrow better than
today. PepsiCo’s commitment to living by this vision every day is visible in its contribution to
the country, consumers and farmers.
This summer training internship project Budgeting System in PepsiCo gives an in-depth
knowledge of the various elements covered in budgetary control system. In this Project I have
done the actual work on Budgeted data of 2011-12 i.e. current year data. But due to some
confidentiality of the PepsiCo I have used the Budget Data of year 2010-11 i.e. last year data
The main objective of the study is to gain knowledge with the current budgetary control
system being implemented through SAP in PepsiCo. Another objective of the study is to
analyze the budget performance. For this purpose, comparison of the Expected performance
and the actual performance has been done. The study tries to highlight the important areas
which require attention and to find out reason for variances.
Ganesh S. Bhat/SIMS/MMS/2010-11 1
EXECUTIVE SUMMARY
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Budget & Budgetary Control Analysis in PepsiCo
The project will explain very clearly what a budget is the process of budgeting and budgetary
control system in PepsiCo. It will also explain the various stages in the preparation of budgets
wherein the process of preparation, approval and review will be studied and analysis of
expenses which also include variance analysis with theoretical concept.
In the preparation of the Budgets, the principle of Zero Base Budgeting is followed according
to which expenditure is required to be justified after evaluation of various alternatives and
ranking them in order of importance by systematic analysis.
The research design is exploratory. All the data gathered are secondary data. The data have
been collected from internal sources.
The brief finding of the study is that in PepsiCo, the Budgeted Estimate made By the Company
is always greater than that of the Revised Estimate in most of the cases. The Company could
achieve 80% or more of the target only in few cases.
The recommendations of this research are that corrective actions should be taken to keep
the budget within the realizable target. The management must focus more on controlling of
budget for maximum utilization of plan budget in terms of financial as well as physical
budgets.
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Overview of Food Industry & Beverage industry
Introduction:
India is the second largest producer of food and holds the potential to be the biggest on global food and
agriculture canvas, according to a Corporate Catalyst India (CCI) survey. The food industry in India
comprises the food production industry and the food processing industry. The food processing industry is one
of the largest in India – it is ranked fifth in terms of production, consumption, export and expected growth.
Growth Drivers of India’s food Industry:
The growth of the food industry is driven by:
Higher disposable incomes
Change in spending pattern
Increasing organized food retailing
Increasing export opportunities
Favorable regulatory environment and Government support and investment inflows
Market Size of Indian food Industry:
The Indian food industry is projected to grow by US$ 100 billion to US$ 300 billion by 2015, according to a
report by a leading industry body and Technopak. The industry, estimated at US$ 200 billion in 2006-07, is
projected to reach US$ 300 billion by 2015. During the period, the share of processed food in value terms is
expected to increase from 43 per cent to 50 per cent.
Exports:
Exports of organic food products are expected to grow five-fold by 2015, according to the Agriculture and
Processed Food Products Export Development Authority (APEDA). The Government agency expects exports
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to touch US$ 1.43 billion by 2014-15 against US$ 280 million in 2010-11.
Exports of floriculture, fresh fruits and vegetables, processed fruits and vegetables, animal products, other
processed foods and cereals stood at US$ 5.45 billion as on November 2010-2011, according to DGCIS
annual data published by APEDA.
Spice Board has revealed that the export of spices from India during 2010-11 has registered an-all-time-high
both in quantity and value. During the year, a total of 5, 25,750 tones of spices and spice products valued at
US$ 1,502.85 million were exported, as against 5, 02,750 tones valued at US$ 1,173.75 million in 2009-10.
This is an increase of 5 per cent in volume and 28 per cent in dollar terms of value.
Food Processing Industry:
Food processing Industry is one of the largest industries operating in India, and is highly fragmented.
Segments:
The Food Processing Industry operates across various segments that include:
Fruits & vegetables
Meat & poultry
Dairy
Marine products, grains and consumer foods (that includes packaged food, beverages and packaged
drinking water).
Value addition of food products is expected to increase from 8 per cent to 35 per cent by the end of 2025.
Fruit & vegetable processing is also expected to increase to 25 per cent of total production in 2025 from the
current level of 2 per cent, states the CCI report. Dairy sector – that holds highest share in processed food
market – holds large potential to be exploited. The report reveals that 37 per cent of the total dairy produce is
processed of which only 15 per cent is done by the organized sector. Hence, there still lies a lot of scope for
investment and development.
The sector has attracted foreign direct investment (FDI) worth US$ 1,253.79 million from April 2000 to April
2011, according to the data provided by Department of Industrial Policy and Promotion (DIPP).
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The amount of FDI inflow for Food Processing Sector in India during the financial year 2010-11 up to
November 2010 (8 months) is US$ 129.2 million.
Beverages: The Indian non-alcoholic drinks market was estimated at around US$ 4.43 billion in 2008 and is expected to
grow at a CAGR of around 15 per cent during 2009-2012, according to a report published by market research
firm RNCOS, titled "Indian Non-Alcoholic Drinks Forecast to 2012".
As per the report, the fruit/vegetable juice market will grow at a CAGR of around 30 per cent in value terms
during 2009-2012, followed by the energy drinks segment which will grow at a AGR of around 29 per cent
during the same period.
Investment Trends:
Dan Cake, Portugal, one of the leading names in the world of bakery and confectionery industry and
one of the largest butter cookies producers worldwide is set to enter the Indian market. For this, the
company has formed a 66:34 joint venture with Pune-based Phadnis Group.
US based McCormick & Co, a leading spice maker, will invest close to US$ 115 million in a joint
venture it will form with Kohinoor Foods Ltd, a leading marketer of branded Basmati rice and other
food products. McCormick's investment, through a Singapore-based subsidiary, will include picking
up an 85 per cent stake in the new joint venture Kohinoor Specialty Foods India Pvt. Ltd. Kohinoor
will hold the balance 15 per cent.
Quick food service restaurant chain Subway will set up 45 outlets across the country by 2011-12
entailing investment of almost US$ 9 million. The company has now 205 outlets in India and plans to
take its count to 250 by the end of this fiscal.
French dairy firm DANONE is chalking out a measured expansion plan in India. The corporation has
been in India for a little over a year and has introduced yogurt, dahi (curd) and smoothie product
range in Pune and Mumbai. It is now focusing on Hyderabad.
Players & Strategies:
Presence of numerous segments across the food industry has generated scope for the players to foray into
diversified portfolios and avenues. For instance, domestic player Dabur India ltd. deals in beverages and
culinary products and foreign company HUL offers beverages, staples, dairy and snack foods. Where on one
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hand overseas firms like ITC, HUL, Britannia and Pepsi offer wide product range and quality, Indian players
like Haldirams, MTR and Parle leverage their position on competitive pricing and mass reach.
Government Initiatives:
The Indian government has approved funds for establishing 15 mega food parks across the country, Food
Processing Secretary Ashok Sinha said. In the wake of social responsibility, the Food Ministry is considering
a new law restricting the amount of food wasted at Indian weddings.The Union budget 2011-12 has also
allocated US$ 135 million to the Food Processing Ministry from the previous US$ 90 million. As a measure
to boost investment in agriculture the minister extended the Viability Gap Funding Scheme (VGFS) for public
private partnerships (PPP) for setting up modern storage capacity besides giving infrastructure status to cold
chains.
Road Ahead:
The food industry in India has taken off significantly well and will continue to grow rapidly given the
unexplored potential in the sector. The growth in this sector is not only indicative of changing development
patterns of the country, similar to the developed nations, but also the promise it holds in propelling growth of
a certain section of society that has remained constrained for a long time.The government of India had also
announced Vision 2015, which lays focus on enhancing the competitiveness of food processing industry in
both domestic as well as international markets along with ensuring stable income levels to farmers. The
Vision 2015 provides for enhancing the level of processing of perishable to 20 per cent, enhancing value
addition to 35 per cent and increasing the share in global food trade from 1.5 per cent to 3 per cent, by 2015.
In the past half-century, the food and beverage industry has blossomed from a collection of mom-and-pop
operations to a trillion-dollar powerhouse led by huge international corporations. Familiar names like
PepsiCo, Starbucks and McDonald's can be found in every corner of the globe. The overarching theme
dominating the food and beverage industry is exploding global demand and rapidly rising food prices. The
breakneck economic growth of countries such as China, India, Brazil and Vietnam gives billions of people the
ability indulge in ways previously enjoyed only by those in developed nations. A massive influx of consumers
onto the global food market has resulted in a rapid and sustained increase in food prices, stoking global
inflation.
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The related shift to ethanol and other bio-diesels in the face of rapidly rising energy prices has only
exacerbated the world's food inflation headache. Although some members of the food and beverage industry
(primarily farmers and agribusinesses) benefit from higher prices, most corporations in the industry have seen
their cost of doing business increase, biting into profit margins. These higher costs are passed, in part, onto
consumers, who find their discretionary spending restricted when they must spend a larger chunk of their
paycheck at restaurants and grocery stores. So, just as oil prices are a key economic indicator, so too are the
prices of key agricultural commodities such as corn, wheat, and soybeans.
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Introduction
PepsiCo, Incorporated (NYSE: PEP) is a Fortune 500, American Multinational Corporation Headquartered in Purchase, NY with interests in manufacturing and marketing a wide variety of carbonated and non-carbonated beverages, as well as salty, sweet and grain-based snacks, and other foods. PepsiCo founded in 1965 through the merger of Pepsi- Cola and Frito- Lay. PepsiCo International is comprised of all PepsiCo businesses in Europe, Asia, Africa and Australia. Historically, Pepsi-Cola began selling its products in Europe in the 1930s and expanded international beverage operations rapidly beginning in the 1950s. PepsiCo formally established an international food unit in 1973, and 30 years later, in 2003 the company combined the food and beverage businesses to form PepsiCo International. Today, the employees of PepsiCo International make, sell and deliver a variety of great tasting foods and beverages around the world, including Lay's potato chips, Doritos, Cheetos, Quaker Oats, Pepsi-Cola, Gatorade, Lipton ready to drink teas, and Tropicana juices. The company also regularly introduces unique products for local tastes.
Revenue: USD 43.25 Billion.
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More than 1,98,000 employees.
PEPSICO IN INDIA:
Chairwoman, President & CEO: Indra Krishnamurthy Nooyi
It entered India in 1989, Owns 43 bottling plants in India, 17 are company owned and 26 are franchisee
owned. Generates direct employment for more than 4000 people in India and indirect employment for 60,000
people.
PepsiCo entered India in 1989 and has grown to become one of the country’s leading food and beverage
companies. One of the largest multinational investors in the country, PepsiCo has established a business
which aims to serve the long term dynamic needs of consumers in India.
PepsiCo India and its partners have invested more than U.S. $1 billion since the company was established in
the country. PepsiCo provides direct and indirect employment to 150,000 people including suppliers and
distributors.
The group has built an expansive beverage and foods business. To support its operations, PepsiCo has 43
bottling plants in India, of which 15 are company owned and 28 are franchisee owned. In addition to this,
PepsiCo’s Frito Lay foods division has 3 state-of-the-art plants. PepsiCo’s business is based on its
sustainability vision of making tomorrow better than today. PepsiCo’s commitment to living by this vision
every day is visible in its contribution to the country, consumers and farmers.
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Company Profile
Name PepsiCo India Holding PrivateLimited (PEPSICO)
Incorporation 1989
Constitution Private Limited Company
Sector Carbonated & Non Carbonated Beverage
Industry Food & Beverage
Activities Production & Distribution
Workforce 1,98,000 employees.
Findings on the basis of history:
The ad campaign has been Indianite with a lot money being spent on advertising.
Brand has been kept alive by effective promotional schemes.
"To be the world's premier consumer Products Company focused on convenience foods and
beverages. We seek to produce healthy financial rewards to investors as we provide
opportunities for growth and enrichment to our employees, our business partners and the
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communities in which we operate. And in everything we do, we strive for honesty,
fairness and integrity."
PepsiCo is a world leader in convenience foods and beverages, with 2007 revenues of more
than $39 billion and more than 185,000 employees across the world. Its world renowned
brands are available in nearly 200 countries and territories.
PepsiCo entered India in 1989 and has grown to become the country’s largest selling food
and beverage companies. One of the largest multinational investors in the country, PepsiCo
has established a business which aims to serve the long term dynamic needs of consumers in
India.
PepsiCo India and its partners have invested more than U.S. $700 million since the company
was established in the country in 1989. In India, PepsiCo provides direct employment to
4,000 people and indirect employment to 60,000 people including suppliers and distributors.
PepsiCo India’s expansive portfolio includes iconic refreshment beverages Pepsi, 7 UP,
Mirinda and Mountain Dew, in addition to low calorie options– Diet Pepsi and 7Up Light;
hydrating and nutritional beverages such as Aquafina drinking water, isotonic sports drinks -
Gatorade, and 100% natural fruit juices and juice based drinks – Tropicana, Tropicana
Twister and Slice. Our local brands – Lehar Everess Soda, Dukes Lemonade and Mangola
complete our diverse spectrum of brands.
PepsiCo’s snack food company, Frito-Lay, is the leader in the branded.
The group has built an expansive beverage, snack food and exports business and to support
the operations are the group’s 38 bottling plants in India, of which 15 are company owned
and 22 are franchisee owned. In addition to this, PepsiCo’s Frito Lay snack division has 3
state of the art plants. PepsiCo’s business is based on its sustainability vision of making
tomorrow better than today. Our commitment to living by this vision every day is visible in
our contribution to our country, consumers, farmers and our people
Performance with Purpose articulates PepsiCo India's belief that its businesses are
intrinsically connected to the communities and world that surrounds it. Performance with
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Purpose means delivering superior financial performance at the same time as we improve the
world.
Vision and Mission
At PepsiCo, we believe being a responsible corporate citizen is not only the right thing to do,
but the right thing to do for our business.
Our Vision
"PepsiCo's responsibility is to continually improve all aspects of the world in which we
operate - environment, social, economic - creating a better tomorrow than today." Our vision
is put into action through programs and a focus on environmental stewardship, activities to
benefit society, and a commitment to build shareholder value by making PepsiCo a truly
sustainable company.
Our Mission
Our mission is to be the world's premier consumer products company focused on convenient
foods and beverages. We seek to produce financial rewards to investors as we provide
opportunities for growth and enrichment to our employees, our business partners and the
communities in which we operate. And in everything we do, we strive for honesty, fairness and
integrity.
Performance with Purpose
At PepsiCo, we're committed to achieving business and financial success while leaving a
positive imprint on society - delivering what we call Performance with Purpose.
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Our approach to superior financial performance is straightforward - drive shareholder value.
By addressing social and environmental issues, we also deliver on our purpose agenda, which
consists of human, environmental, and talent sustainability
PRODUCTS
PepsiCo nourishes consumers with a range of products from tasty treats to healthy eats that deliver
enjoyment, nutrition, convenience as well as affordability.
Beverages
PepsiCo India’s expansive portfolio includes iconic refreshment beverages Pepsi, 7 UP, Nimbooz,
Mirinda and Mountain Dew, in addition to low calorie options such as Diet Pepsi, hydrating and
nutritional beverages such as Aquafina drinking water, isotonic sports drinks - Gatorade,
Tropicana100% fruit juices, and juice based drinks – Tropicana Nectars, Tropicana Twister
and Slice. Local brands – Lehar Evervess Soda, Dukes Lemonade and Mangola add to the
diverse range of brands.
Foods
PepsiCo’s food division, Frito-Lay, is the leader in the branded salty snack market and all Frito Lay
products are free of trans-fat and MSG. It manufactures Lay’s Potato Chips, Cheetos extruded
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snacks, Uncle Chipps and traditional snacks under the Kurkure and Lehar brands. The
company’s high fiber breakfast cereal, Quaker Oats, and low fat and roasted snack options enhance
the healthful choices available to consumers. Frito Lay’s core products, Lay’s, Kurkure Uncle
Chipps and Cheetos are cooked in Rice Bran Oil to significantly reduce saturated fats and all of its
products contain voluntary nutritional labeling on their packets.
MANAGEMENT STRUCTURE
The Management Structure of PepsiCo India Holdings Pvt. Ltd. is given below:
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Top Management (Plant Manager)
Account Section
Production & Maintenance Dept
Purchase Dept. Personnel & Admin Dept.
Quality Control & Inspection Dept.
Shipping & Distribution
Store Dept.
Management Representative & Training
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Budget & Budgetary Control Analysis in PepsiCo
PEP Revenues by Segment:
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PepsiCo is the largest snack and non-alcoholic drink producer in the United States, with 39% and 25% of
the respective market shares. The fall in net income was attributable to two reasons. First, PepsiCo
recognized a $346 million mark-to-market loss on derivatives used to hedge its commodity exposure.
Next, the company incurred restructuring costs of $543 million in relation to its Productivity for Growth
program.
Operating Segments:
PepsiCo operates in six divisions:
Frito-Lay North America (29% of Revenue, 43% of Operating Income):
Manufactures markets and sells branded snacks. Popular products include Lay's Potato Chips, Doritos
Tortilla Chips, Cheetos, Rold Gold Pretzels, and SunChips. Following the company's purchase of Pepsi
Bottling Group (PBG) and Whitman (PAS), company executives have said that it will lead to increased
joint marketing, bundling the company's snack and beverage offerings.
Quaker Foods North America (4% of Revenue, 8% of Operating Income):
Manufactures markets and sells cereals, rice, pasta and other branded products. Popular products
include Quaker Oatmeal, Aunt Jemima mixes and syrups, Cap n' Crunch cereal, Rice-A-Roni, and
Life cereal.
Latin America Foods (14% of Revenue, 13% of Operating Income):
Manufactures markets and sells a number of leading salty and sweet snack brands. Popular products
include Gamesa, Doritos, Cheetos, and Ruffles.
PepsiCo Americas Beverages (25% of Revenue, 29% of Operating Income):
Manufactures markets and sells beverage concentrates, fountain syrups and finished goods, under
various beverage brands. Popular products include Pepsi, Mountain Dew, Gatorade, Tropicana, and
Izze.
United Kingdom & Europe (15% of Revenue, 10% of Operating Income):
Manufactures markets and sells a number of leading salty and sweet snack brands. Popular products
include Lay's, Walker's, Doritos, and Cheetos.
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Middle East, Africa, and Asia (13% of Revenue, 8% of Operating Income):
Manufactures markets and sells a number of leading salty and sweet snack brands. Popular products
include Lay's, Smith's, Doritos, and Cheetos.
Key developments of PepsiCo
Grupo Embotelladoras Unidas SAB de CV Receives Authorization for Business
Integration and New Company with PepsiCo Inc and Polmex Holdings SL
Group Embotelladoras Unidas SAB de CV announced that on August 31, 2011 it received an
authorization from its shareholders to carry out the operation with Pepsico Inc and Polmex
Holdings SL, under which they will integrate the beverage business of the Pepsi Bottling Group
Mexico S de RL de CV and its subsidiaries and Gatorade de Mexico (composed of Productos
Gatorade de Mexico S de RL de CV, Gatorade de Mexico S de RL de CV and Servicios
Operativos Gatorade de Mexico S de RL de CV) with Geusa SA de CV. As a result, the first
beverage company with national coverage will be created. The operation was approved by the
Federal Competition Commission on August 23, 2011 and its completion is expected on
September 30, 2011.
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PepsiCo Inc. Raises FY 2011 EPS Guidance
PepsiCo Inc. updated its fiscal 2011 earnings per share (EPS) guidance and expects high-single-
digit earnings per share growth on a core, 52-week basis, including an estimated foreign
exchange translation benefit of approximately 2 percentage points, from its fiscal 2010 core EPS
of $4.13. The current guidance compares to the Company's previous fiscal 2011 guidance of 7%-
8% core constant currency EPS growth and an estimated 1 to 2 percentage point benefit from
foreign exchange. The Company's updated guidance reflects higher uncertainty regarding
macroeconomic and consumer trends for 2011 and anticipates high global commodity cost
inflation and ongoing support of strategic initiatives in emerging markets and of its brand-
building activities. According to I/B/E/S Estimates, analysts were expecting the Company to
report EPS of $4.50 for fiscal 2011.
PepsiCo Inc. Plans Mexico Beverage Joint Venture With Grupo Embotelladoras-DJ
Dow Jones reported that PepsiCo Inc. plans to form a nationwide beverage company in Mexico
through a joint-venture with bottler Grupo Embotelladoras Unidas SAB and Venezuelan food
and drink producer Empresas Polar. Pepsi said the venture would combine its Mexican beverage
manufacturing and distribution operations with those of Grupo Embotelladoras unit GEUSA,
which is a Pepsi bottler.
PepsiCo Inc. To Buy Remaining Stake In Russia's Wimm-Bill-Dann Foods-DJ
Dow Jones reported that PepsiCo Inc. plans to exercise an option to acquire the remaining stake
of Russian dairy products and juice maker Wimm-Bill-Dann Foods that it doesn't already own,
marking the completion of its second major foray into the Russian market. Late last year,
PepsiCo Inc. agreed to purchase a 66% stake in Russia's food and beverage business for about
$3.8 billion. PepsiCo Inc. was expected to buy the remaining stake at a future date. Pepsi said
ordinary shareholders would be entitled to receive 3,883.70 Russian rubles $139.33) per ordinary
share. Holders of the American Depositary Shares will receive RUB970.025 per ADS, subject to
conversion and payable in U.S. dollars. The deal, which is expected to close by September,
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follows Pepsi's move in 2008 to pay $1.4 billion for control of Russian juice producer
Lebedyansky.
East Capital Explorer AB (publ) Accepts PepsiCo Inc.'s Subsidiary Buyout Offer for
Wimm-Bill-Dann Foods OJSC
East Capital Explorer AB (publ) announced that it has accepted PepsiCo's subsidiary's buyout
offer to purchase its holding in Wimm-Bill-Dann Foods OJSC. East Capital Explorer realized an
annualized pre-tax return of 17.4% on its initial EUR 6.8 million investment (39.7% pre-tax IRR
when measured in the transaction currency USD). The buyout offer by PepsiCo was required in
accordance with Russian law after it received approval to acquire 66% of Wimm-Bill-Dann for a
price USD 132 per common share. After the buyout, East Capital Explorer received EUR 7.4
million which is available for future investments.
Overview of Finance Department.
Financial management is a key tool in controlling and directing the resources of any business
organization. Managers--not only financial professionals but also managers whose responsibilities
are largely non-financial--can use this tool to generate and analyze the financial information that is
essential to decision making in business. Understanding the principles of financial management
helps all managers, from line supervisors to senior executives, to use this tool more effectively to
support the organization's goals. This course introduces non-financial managers to the principles of
financial management. It explores the basic concepts of risk and return and time value of the money.
Functions of Finance Department in Organization
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1. Estimation of capital requirements: A finance manager has to make estimation with
regards to capital requirements of the company. This will depend upon expected costs and
profits and future programmers and policies of a concern. Estimations have to be made in an
adequate manner which increases earning capacity of enterprise.
2. Determination of capital composition: Once the estimation have been made, the capital
structure have to be decided. This involves short- term and long- term debt equity analysis.
This will depend upon the proportion of equity capital a company is possessing and
additional funds which have to be raised from outside parties.
3. Choice of sources of funds: For additional funds to be procured, a company has many
choices like-
a. Issue of shares and debentures
b. Loans to be taken from banks and financial institutions
c. Public deposits to be drawn like in form of bonds.
Choice of factor will depend on relative merits and demerits of each source and period of
financing.
4. Investment of funds: The finance manager has to decide to allocate funds into profitable
ventures so that there is safety on investment and regular returns is possible.
5. Disposal of surplus: The net profits decision have to be made by the finance manager. This
can be done in two ways:
a. Dividend declaration - It includes identifying the rate of dividends and other benefits
like bonus.
b. Retained profits - The volume has to be decided which will depend upon expansion,
innovation, diversification plans of the company.
6. Management of cash: Finance manager has to make decisions with regards to cash
management. Cash is required for many purposes like payment of wages and salaries,
payment of electricity and water bills, payment to creditors, meeting current liabilities,
maintenance of enough stock, purchase of raw materials, etc.
7. Financial controls: The finance manager has not only to plan, procure and utilize the funds
but he also has to exercise control over finances. This can be done through many techniques
like ratio analysis, financial forecasting, cost and profit control, etc.
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Financial performance of last Five years
Income statement 05 years summary (in $ Millions )
2010 2009 2008 2007 2006
Revenue 57,838.00 43,232.00 43,251.00 39,474.00 35,137.00
Total Revenue 57,838.00 43,232.00 43,251.00 39,474.00 35,137.00
Cost of Revenue, Total 26,575.00 20,099.00 20,351.00 18,038.00 15,762.00
Gross Profit 31,263.00 23,133.00 22,900.00 21,436.00 19,375.00
Selling/General/
Administrative Expenses,
Total
22,326.00 14,612.00 15,489.00 14,196.00 12,711.00
Research & Development 488 414 388 0 0
Depreciation/Amortization 117 63 64 58 162
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Interest Expense (Income), Net
Operating
0 0 0 0 0
Unusual Expense (Income) 0 0 0 0 0
Other Operating Expenses,
Total
0 0 0 0 0
Operating Income 8,332.00 8,044.00 6,959.00 7,182.00 6,502.00
Interest Income (Expense), Net
Non-Operating
0 0 0 0 0
Gain (Loss) on Sale of Assets 0 0 0 0 0
Other, Net 0 0 0 0 0
Income Before Tax 8,232.00 8,079.00 7,045.00 7,643.00 6,989.00
Income Tax - Total 1,894.00 2,100.00 1,879.00 1,973.00 1,347.00
Income After Tax 6,338.00 5,979.00 5,166.00 5,670.00 5,642.00
Minority Interest -18 -33 -24 12 0
Equity In Affiliates 0 0 0 0 0
U.S. GAAP Adjustment 0 0 0 0 0
Net Income Before Extra.
Items
6,320.00 5,946.00 5,142.00 5,682.00 5,642.00
Total Extraordinary Items 0 0 0 0 0
Net Income 6,320.00 5,946.00 5,142.00 5,682.00 5,642.00
Total revenue:
The total revenue of the Company has increased from 35,137.00 in year 2006 to 57,838.00 in the
year2010. It increased by 64.60%.
Ganesh S. Bhat/SIMS/MMS/2010-11 22
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Budget & Budgetary Control Analysis in PepsiCo
2010 2009 2008 2007 2006
57,838.00
43,232.00 43,251.0039,474.00
35,137.00
Revenue (in $ million)
Net Income:
Net profit /Net income after Tax has increased from $ 5642 million in 2006 to $ 6320 in the year
2010.Its increased by around 15%.
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Budget & Budgetary Control Analysis in PepsiCo
2010 2009 2008 2007 2006
6,320.005,946.00
5,142.005,682.00 5,642.00
Net income (in $ million)
Growth Rates %Growth Rates % Company Industry S&P 500
Sales (Qtr vs year
ago qtr) 13.7 32 16
Net Income (Qtr vs
year ago qtr) 17.6 16.6 63.2
Sales (5-Year Annual
Avg.) 12.18 9.82 8.18
Net Income (5-Year
Annual Avg.) 9.23 14.72 8.69
Dividends (5-Year
Annual Avg.) 13.35 9.65 5.62
Ganesh S. Bhat/SIMS/MMS/2010-11 24
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Budget & Budgetary Control Analysis in PepsiCo
Sales (Qtr vs year ago qtr)
Net Income (Qtr vs year ago qtr)
Sales (5-Year Annual Avg.)
Net Income (5-Year Annual
Avg.)
Dividends (5-Year Annual
Avg.)
0
10
20
30
40
50
60
70
Growth(in %)
CompanyIndustryS&P 500
The table & chart indicates the growth of sales of the Company, Industry & S&P 500 in the terms of
percentage.
The growth of sales of the Co. is 13.70% & S&P500 is 16% where as Industry growth rate is 32
%.
Net Income of (5 yrs. Avg.) of Co. is 9.23 %, Industry Net income (5 yrs. Avg.) is 14.72 %,
where S&P500 is 8.69 %.
Dividend (5-Year Annual Avg.) of the Company is higher than Industry & S&P500, which is 13.35
% as compare to 9.65 % & 5.62 % respectively.
Activity process flow chart
Ganesh S. Bhat/SIMS/MMS/2010-11 25
Receive Purchase Indent From Production
Page 26
Budget & Budgetary Control Analysis in PepsiCo
Ganesh S. Bhat/SIMS/MMS/2010-11 26
Check with Stock List
Supplier Registration
Issue P.O. For Raw Material
List of Approved Suppliers
Supplier EvaluationPrepare GIN for Raw material
Prepare the GRN
Raw Material Inspected by Q & I Dept.
Return material to supplier with GRN and RRN
Not select
Select
IdentificationStore R.M. at Storage Dept.
Raw material issue slipIssue Raw material for Production Dept.
Update stock
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Budget & Budgetary Control Analysis in PepsiCo
RESEARCH METHODOLOGY
1. Research Design : Exploratory Research
2. Data Collection Method : Secondary Data Collection Method
3. Operational Area of Study: Plant Budgeting.(PepsiCo.)
OBJECTIVES OF STUDY
To learn and understand the budget forecast, activity planning, preparation of budget,
monitoring and controlling of budget.
Analyze the company’s performance
To understand use of SAP in budgeting process of PepsiCo.
Determining the amount of different types of Expenditure and estimating the
expenditure of future requirements.
To analyze variance of actual performance with the target set.
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Budget & Budgetary Control Analysis in PepsiCo
BUDGETING AND
BUDGETARY CONTROL ANALYSIS
Budgeting is used by businesses as a method of financial planning for the future. Budgets are
prepared for main areas of the business – purchases, sales, production, labour, debtors, creditors,
cash – and provide detailed plans of the business for the next three, six or twelve months. The focus
of this project is the cash budget.
In this project I observed:
• The benefits of budgets and budgetary control
• The limitations of budgets and budgetary control
• The preparation and use of cash budgets
Introduction to budgets
Businesses need to plan for the future. In large businesses such planning is very formal while, for
smaller businesses, it will be less formal. Planning for the future falls into three time scales:
• Long-term: from about three years up to, sometimes, as far as twenty years ahead
• Medium-term: one to three years ahead
• Short-term: for the next year
Clearly, planning for these different time scales needs different approaches: the further on in time,
the less detailed are the plans. In the medium and longer term, a business will establish broad
business objectives. Such objectives do not have to be formally written down, although in a large
business they are likely to be. In smaller businesses, objectives will certainly be considered and
discussed by the owners or managers. Planning takes note of these broader business objectives and
sets out how these are to be achieved in the form of detailed plans known as budgets.
What is a budget?
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Budget & Budgetary Control Analysis in PepsiCo
A budget is a financial plan for a business, prepared in advance.
A budget may be set in money terms, e.g. a sales budget of £500,000, or it can be expressed in terms
of units, e.g. a purchases budget of 5,000 units to be bought.
Budgets can be income budgets for money received, e.g. a sales budget, or expenditure budgets for
money spent, e.g. a purchases budget.
The budget we shall be focusing on in this chapter is the cash budget, which combines both income
and expenditure, estimating what will happen to the bank balance during the time period of the
budget. Most budgets are prepared for the next financial year (the budget period), and are usually
broken down into shorter time periods, commonly four-weekly or monthly. This enables budgetary
control to be exercised over the budget: the actual results can be monitored against the budget, and
discrepancies between the two can be investigated and corrective action taken where appropriate.
Benefits of budgets and budgetary control
Budgets provide benefits both for the business, and also for its managers and other staff:
The budget assists planning
By formalizing objectives through a budget, a business can ensure that its plans are achievable. It
will be able to decide what is needed to produce the output of goods and services, and to make sure
that everything will be available at the right time.
The budget communicates and co-ordinates
Because a budget is agreed by the business, all the relevant managers and staff will be working
towards the same end. When the budget is being set, any anticipated problems should be resolved
and any areas of potential confusion clarified. All departments should be in a position to play their
part in achieving the overall goals.
The budget helps with decision-making
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Budget & Budgetary Control Analysis in PepsiCo
By planning ahead through budgets, a business can make decisions on how much output – in the
form of goods or services – can be achieved. At the same time, the cost of the output can be planned
and changes can be made where appropriate.
The budget can be used to monitor and control
An important reason for producing a budget is that management is able to use budgetary control to
monitor and compare the actual results (see diagram below). This is so that action can be taken to
modify the operation of the business as time passes, or possibly to change the budget if it becomes
unachievable.
The budget can be used to motivate
A budget can be part of the techniques for motivating managers and other staff to achieve the
objectives of the business. The extent to which this happens will depend on how the budget is agreed
and set, and whether it is thought to be fair and achievable. The budget may also be linked to
rewards (for example, bonuses) where targets are met or exceeded.
Limitations of budgets and budgetary control
Ganesh S. Bhat/SIMS/MMS/2010-11 30
BUDGET FIGURES
ACTUAL FIGURECONTROL AND TAKE ACTION
MONITOR AND COMPARE
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Budget & Budgetary Control Analysis in PepsiCo
Whilst most businesses will benefit from the use of budgets, there are a number of limitations of
budgets to be aware of:
The benefit of the budget must exceed the cost:
Budgeting is a fairly complex process and some businesses – particularly small ones – may find that
the task is too much of a burden in terms of time and other resources, with only limited benefits.
Nevertheless, many lenders – such as banks – often require the production of budgets as part of the
business plan. As a general rule, the benefit of producing the budget must exceed its cost.
Budget information may not be accurate:
It is essential that the information going into budgets should be as accurate as possible. Anybody can
produce a budget, but the more inaccurate it is, the less use it is to the business as a planning and
control mechanism. Great care needs to be taken with estimates of sales – often the starting point of
the budgeting process – and costs. Budgetary control is used to compare the budget against what
actually happened – the budget may need to be changed if it becomes unachievable.
The budget may demotivate:
Employees, who have had no part in agreeing and setting a budget which is imposed upon them, will
feel that they do not own it. As a consequence, the staff may be demotivated. Another limitation is
that employees may see budgets as either a ‘carrot’ or a ‘stick’, ie as a form of encouragement to
achieve the targets set, or as a form of punishment if targets are missed.
Budgets may lead to disfunctional management:
A limitation that can occur is that employees in one department of the business may over-achieve
against their budget and create problems elsewhere. For example, a production department might
achieve extra output that the sales department finds difficult to sell. To avoid such dysfunctional
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Budget & Budgetary Control Analysis in PepsiCo
management, budgets need to be set at realistic levels and linked and co-ordinate across all
departments within the business.
Budgets may be set at too low a level:
Where the budget is too easy to achieve it will be of no benefit to the business and may, in fact, lead
to lower levels of output and higher costs than before the budget was established. Budgets should be
set at realistic levels, which make the best use of the resources available.
Budgetary planning
Many large businesses take a highly formal view of planning the budget and make use of:
• A budget manual, which provides a set of guidelines as to who is involved with the budgetary
planning and control process, and how the process is to be conducted
• A budget committee, which organizes the process of budgetary planning and control; this
Committee brings together representatives from the main functions of the business –
E.g. production, sales, administration – and is headed by a budget co-coordinator whose job is to
administer and oversee the activities of the committee. In smaller businesses, the process of planning
the budget may be rather more informal, with the owner or manager overseeing and budgeting for all
the business functions.
Whatever the size of the business it is important, though, that the planning process begins well
before the start of the budget period; this then gives time for budgets to be prepared, reviewed,
redrafted, and reviewed again before being finally agreed and submitted to the directors or owners
for approval.
Budgeting Process
The following budgeting process involves the participation of all the senior staff in the whole
organization.
1. The senior management held a meeting to discuss and set the future directions of the company.
2. The key financial information such as future business targets are identified.
3. Taking cue from the business plans, a deadline for the completion of the budgets is determined.
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Budget & Budgetary Control Analysis in PepsiCo
4. The Finance head will start the preparation process by accumulating the historical financial data
and put them in the templates similar to the existing financial statements.
5. The budget templates are then further extended to departmental or cost centres levels.
6. The business targets and the templates are distributed to the various departmental heads which
consist of both Finance and non Finance managers. All the managers are required to prepare their
budgets for their respective areas and devise business plan on how to achieve them.
7. The Finance manager will collect all the completed templates from the respective departmental
managers and compile into a master budget.
8. Once the master budget is ready, the Finance manager will present it to the senior management.
The above processes can be summarized into 4 main steps as follows:
1 Set Business Targets
2 Accumulate Historical Data
3 Prepare Business Plans and Strategies
4 Compile into Master Budget
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Budget & Budgetary Control Analysis in PepsiCo
Types of Budgets:
For Finance Executives, it is necessary to be familiar with the various types of budgets to understand
the whole picture. The types of budgets include master, operating (for income statement items
comprised of revenue and expenses), financial (for balance sheet items), cash, static (fixed), flexible,
capital expenditure (facilities), and program (appropriations for specific activities such as research
and development, and advertising). These budgets are briefly explained below.
Master Budget:
A master budget is an overall financial and operating plan for a forthcoming calendar or fiscal year.
It is usually prepared annually or quarterly. The master budget is really a number of sub budgets tied
together to summarize the planned activities of the business. The format of the master budget
depends on the size and nature of the business.
Operating and Financial Budgets:
The operating budget deals with the costs for merchandise or services produced. The financial
budget examines the expected assets, liabilities, and stockholders' equity of the business. It is needed
to see the company's financial health.
Cash Budget:
The cash budget is for cash planning and control. It presents expected cash inflow and outflow for a
designated time period. The cash budget helps management keep cash balances in reasonable
relationship to its needs and aids in avoiding idle cash and possible cash shortages. The cash budget
typically consists of four major sections:
1. Receipts section, which is the beginning cash balance, cash collections from customers, and other
receipts
2. Disbursement section comprised of all cash payments made by purpose
3. Cash surplus or deficit section, showing the difference between cash receipts and cash payments
4. Financing section, providing a detailed account of the borrowings and repayments expected
during the period.
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Budget & Budgetary Control Analysis in PepsiCo
Sections of a cash budget
A cash budget consists of three main sections:
• Receipts for the month
• Payments for the month
• Summary of bank account
Receipts are analyzed to show the amount of money that is expected to be received from cash sales,
debtors, sale of fixed assets, capital introduced/issue of shares, loans received etc.
Payments show how much money is expected to be paid in respect of cash purchases, creditors,
expenses (often described in cash budgets as operating expenses), purchases of fixed assets,
repayment of capital/shares and loans. Note that non-cash expenses (such as depreciation and
doubtful debts) are not shown in the cash budget.
The summary of the bank account at the bottom of the cash budget shows net cash flow (total
receipts less total payments) added to the bank balance at the beginning of the month, and resulting
in the estimated closing bank balance at the end of the month. An overdrawn bank balance is shown
in brackets.
The main difficulty in the preparation of cash budgets lies in the timing of receipts and payments –
for example, debtors may pay two months after date of sale, or creditors may be paid by the business
one month after date of purchase: it is important to ensure that such receipts and payments are
recorded in the correct month column.
Static (Fixed budget):
The static (fixed) budget is budgeted figures at the expected capacity level. Allowances are set forth
for specific purposes with monetary limitations. It is used when a company is relatively stable.
Stability usually refers to sales. The problem with a static budget is that it lacks the flexibility to
adjust to unpredictable changes. In industry, fixed budgets are appropriate for those departments
whose workload does not have a direct current relationship to sales, production, or some other
volume determinant related to the department's operations. The work of the departments is
determined by management decision rather than by sales volume. Most administrative, general
marketing and even manufacturing management departments are in this category. Fixed
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Budget & Budgetary Control Analysis in PepsiCo
appropriations for specific projects or programs not necessarily completed in the fiscal period also
become fixed budgets to the extent that they will be expended during the year.
Examples are appropriations for capital expenditures, major repair projects, and specific advertising
or promotional programs.
Study of budgeting in PepsiCo
Budgets are planned for specific sections of the business: these budgets can then be controlled by a
budget holder, who may be the manager or supervisor of the specific section. Such budgets include:
• Purchases budget – what the business needs to buy to make/supply the goods it expects to sell
• Sales budget – what the business expects to sell
• Production budget – how the business will make/supply the goods it expects to sell
• Labor budget – the cost of employing the people who will make/supply the goods
• Debtor budget – how much the business will receive from credit sales
• Creditor budget – how much the business will pay for credit purchases
• Cash budget – how much money will be flowing in and out of the bank account
The end result of the budgeting process is often the production of a master budget, which takes the
form of forecast operating statements – forecast trading and profit and loss account – and forecast
balance sheet. The master budget is the ‘master plan’ which shows how all the other budgets ‘work
together’.
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Budget & Budgetary Control Analysis in PepsiCo
Material description
Basic Cost ED VAT Freight Unload Tran. Ins. Octroi
Service
tax Total
CAMERA VISION
SYSTEM 38160.00
96,2
96.76
128,90
2.10 57,851.26 321210.12
SERVO BASED
REJECTION
MECHANISUM 324360.00
33,4
09.08
44,72
1.14 22,579.70 425069.92
DATA LOGGING
SYSTEM CAMERA
VISION 38160.00
3,9
30.48 5,261.31 2656.44 50008.23
UPS SYSTEM FOR
DATE LOGGING. 38160.00
3,9
30.48 5,261.31 2656.44 50008.23
Autoscrubber elect.
M/c 253687.01
31,71
0.88 1,000.00 14,062.79 300460.68
tASKI vACUMAT22
230V/50HZ 33481.49
4,18
5.19 500 1,896.48 40063.16
HIGH PRESSURE
WATER JET 71679.12
8,95
9.89 500 3,997.35 85136.36
TASKI DORSALINO
230V 50 HZ 39911.62
4,98
8.95 500 2,250.14 47650.71
PICOBELLO 151 36765.91
4,59
5.74 500 2,077.13 43938.78
0.00
PCC ROOM PIPE
WORKS 300000.00 300000.00
0.00
FILLED
INSPECTION
STATION 969000.00
121,12
5.00
20,000.0
0 10,901.25 62,278.02 1183304.27
Installation &
Commissioning 25000.00
2,5
75.00
2,57
5.00 30150.00
0.00
Testo 875-2 thermal
imager 284050.00
35,50
6.25 319556.25
0.00
SPEED RETARDER 63240.00
7,90
5.00 71145.00
Ganesh S. Bhat/SIMS/MMS/2010-11 37
Expected cost for different material categories during the year 2010-11:
Page 38
Budget & Budgetary Control Analysis in PepsiCo
CONVEX MIRROR 9800.00
1,22
5.00 11025.00
0.00
ISMB 200 68580.00
3,42
9.00 72009.00
ISMC 120 X 75 184140.00
9,20
7.00 193347.00
ISMC 200 41760.00
2,08
8.00 43848.00
ISMC 100 X 50 86940.00
4,34
7.00 91287.00
MS PLATE GUSSET
12 MM THK 40500.00
2,02
5.00 42525.00
TOE GUARD MS
FLAT 22500.00
1,12
5.00 23625.00
ISA 75 X 75 X 6 MM 7335.00
36
6.75 7701.75
ROD 16 MM DIA 2250.00
11
2.50 2362.50
CHARGER PLATE 4
MM. 91520.00 4,576.00 96096.00
RAILLING PIPE 32
NB 110550.00 5,527.50 116077.50
MS ELBOW 32 NB 16200.00 810 17010.00
M 16 NUT BOLTS 60
MM 1440.00 72 1512.00
ANCHORE BOLT 16
X 100 MM LONG 3840.00 192 4032.00
CHAIN PULLY
BLOCK 12000.00 1,500.00 13500.00
CHAIN PULLY
TROLLY 6600.00 825 7425.00
fabrication & erection
monorail at CT 478827.00 49,319.18
49,31
9.18 577465.36
11 STAGE APEC
PANEL -300 KVR 588000.00 73,500.00
10,000.0
0 34,108.80 705608.80
6 STAGE APFC
PANEL 100 KVAR 125440.00 NA 7,037.18 132477.18
BIO-WASTE
CONVERTER 452189.00 0 452189.00
0.00
Providing & laying 171995.00 8,599.75 17,715.49 198310.24
Ganesh S. Bhat/SIMS/MMS/2010-11 38
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Budget & Budgetary Control Analysis in PepsiCocaustic storage faci
0.00
15 S MULTIMETER 20662.50 2,582.81 23245.31
DIGITAL
INSULATION
TESTER 16169.00 2,021.13 18190.13
AC TONG TESTER 22562.50 2,820.31 25382.81
PORTABLE POWER
ANALYSER 104500.00 NA 104500.00
MOTOR CHEKER 15675.00 NA 15675.00
0.00
Receiver & liquid line
valve 504400.00 63,050.00 7,000.00 28,512.00 602962.00
0.00
Revamping of UASB
ETP 820000.00 102,500.00 922500.00
Erection &
commissioning 60000.00
6,1
80.00 6,180.00 72360.00
0.00
FABRICATION &
INSTALLATION HP
MONORAIL 328080.00
33,7
92.24 33,792.24 395664.48
0.00
ISMB 250 40284.00 1,611.36 41895.36
ISMC 150 X 75 110700.00 4,428.00 115128.00
MS PLATE 12 MM
THK 5625.00 225 5850.00
ISMC 100 X 50 19872.00 794.88 20666.88
MS FLAT 100 X 6
MM 11925.00 477 12402.00
ISA 75 X 75 X 6 MM 7344.00 293.76 7637.76
ROD 16 MM DIA 2250.00 90 2340.00
CHAQUIRE PLATE 4
MM 60320.00 2,412.80 62732.80
RAILING PIPE 32
NB. 56100.00 2,244.00 58344.00
MS ELBOW. 6300.00 252 6552.00
M 16 NUT BOLT 600.00 24 624.00
anchor bolt 16 x 100
mm 1600.00 64 1664.00
CHAIN PULLY. 36000.00 4,500.00 40500.00
CHAIN PULLY 13000.00 1,625.00 14625.00
Ganesh S. Bhat/SIMS/MMS/2010-11 39
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Budget & Budgetary Control Analysis in PepsiCoTROLY.
0.00
UG TANK FENCING
WORK 131560.00 5,262.40 136822.40
0.00
BOILER SAFETY &
EFF MONITORING
SYS. 1124379.00 140,547.38
10,000.0
0 71523.37 1346449.75
0.00
Heavy duty platform
trolly 10 Feet 192000.00 24,000.00 11,880.00 227880.00
Tltable tower ladder
ES-TTL-H 40 Feet 225000.00 28,125.00
25,000.0
0 15,296.88 293421.88
Maintenance Trolley
ES-MTHD_H 6 feet 151200.00 18,900.00 9,355.50 179455.50
LADDER FIBER 18
FEET 69000.00 8,625.00 4,269.38 81894.38
0.00
ENERGY SAVER 3
PH 415 VOLTS 50 HZ 240000.00
4,8
00.00
10,000.0
0 14,564.00 4,800.00 274164.00
INSTALLATION &
COMM 10000.00
1,0
30.00 1,030.00 12060.00
0.00
MCC CONTROL
PANEL WITH DOL
STARTER 887400.00 110,925.00 3,000.00 56,174.34 1057499.34
0.00
Equalisation pump
KGEC 14-8 35162.56 1,758.13 2,062.73 38983.42
Equalisation pump
Motor 27358.00 3,419.75 1,723.25 32501.00
Equalisation pump
Access & Matching
Flan 17286.87 2,160.86 972.06 20419.79
UASB PUMP KGEC
12B-5 29152.52 1,457.63 1,710.17 32320.32
UASB PUMP KGEC
12B-5 MOTOR. 14535.21 1,816.90 918.13 17270.24
UASB PUMP
ACCESS & FLANGE 13219.37 1,652.42 744.63 15616.42
CLARIFIER PUMP
FRE 80-210 118195.38 5,909.77
6,
933.66 131038.81
CLARIFIER PUMP 19609.41 2,451.18 1,231.23 23291.82
Ganesh S. Bhat/SIMS/MMS/2010-11 40
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Budget & Budgetary Control Analysis in PepsiCoMOTOR
CLARIFIER PUMP
ACCESS & FLANGE 19320.62 2,415.08 1,080.27 22815.97
GARDENING PUMP
KGEC 16-6 36736.38 1,836.82 2,155.06 40728.26
GARDENING PUMP
MOTOR 27358.00 3,419.75 1,717.75 32495.50
GARDENING PUMP
ACCESS & FLANG 17286.87 2,160.86 966.56 20414.29
Tursury treatment
pump CN 40-160 35360.54 1,768.03 2,074.34 39202.91
Tursury treatment
pump MOTOR. 17842.08 2,230.26 1,120.26 21192.60
Tursury treatment
pump ACCESS &
FLANGE 15253.12 1,906.64 852.84 18012.60
wATER PUMP KGEC
16-6 36736.38 1,836.82 2,155.06 40728.26
wATER PUMP KGEC
16-6 MOTOR 27358.00 3,419.75 1,717.75 32495.50
wATER PUMP KGEC
ACCESS & FLANGE 17286.87 2,160.86 966.56 20414.29
Mechnical Seal cn 40-
160 17286.87 2,160.86 966.56 20414.29
0.00
light curtain 31500.00 3,937.50 35437.50
AF 20MR D 11700.00 1,462.50 13162.50
POWER SUPPLY
PS230 2700.00 337.5 3037.50
0.00
M & w COUNTER
COMPLETE SET 22145.00 2,768.13 1,000.00 1,327.98 27241.11
RELAY 24 V 875.50 109.44 48.15 1033.09
0.00
DIGITAL ENERGY
METER E 1000 6175.00 771.88 6946.88
DIGITAL ENERGY
METER ENTITY
VER 1.0 16458.75 2,057.34 18516.09
DIGITAL ENERGY
METER ENTITY
VER 1.0 3135.00 391.88 3526.88
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Budget & Budgetary Control Analysis in PepsiCoDIGITAL ENERGY
METER ENTITY
VER 1.0 9975.00 1,246.88 11221.88
DIGITAL LOAD
MANAGER 11400.00 1,425.00 12825.00
ENERGY METER
WITH PANEL 8075.00 1,009.38 9084.38
CURRENT
TRANSFORMER 5700.00 712.5 6412.50
WIRING OF
ENERGY METER 1425.00 178.13 1603.13
MAKING CUTOUT
WIRING 19950.00 2,493.75 22443.75
0.00
PROVIDING &
FIXING EYE
WASHER 164227.00 0 164227.00
0.00
Blower
fitting,cabeling,civil
work 189000.00 NA 189000.00
0.00
Providing & laying
PVC strip door 272363.52 0 272363.52
0.00
MCC CONTROL
PANAEL FOR WR
PLANT 770355.00 96,294.38 5,000.00 48899.53 920548.91
DRONA PCH CHAIR. 177574.32 22,196.79 - 1217970.12
KAREENA CHAIR
GODREJ. 43140.11 5,392.51 48532.62
motor gaurd 10 HP 6897.00 862.13 7759.13
MOTOR GAURD 7.5
HP 1024.10 128.01 1152.11
MOTOR GAURD
0.75 HP 2037.75 254.72 2292.47
MOTOR GAURD 3
HP 950.00 118.75 1068.75
MOTOR GAURD 3.7
KW 1024.10 128.01 1152.11
MOTOR GAURD 15 4284.50 535.56 4820.06
Ganesh S. Bhat/SIMS/MMS/2010-11 42
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Budget & Budgetary Control Analysis in PepsiCoKW
MOTOR GAURD
11KW 6897.00 862.13 7759.13
WTP PANEL
WIRING &
INSTALLATION 640788.00 53,666.00 21,780.38 716234.38
DISCONNECTING
AND REMOVING
WTP PANEL 35000.00
3,6
05.00 3,605.00 42210.00
MIS
CONDITIONIONG
OF ELECTRICAL 693922.00 58,115.97 23586.41 775624.38
Installation,
commissioning and
Painting 34413.60
3,2
13.60 3213.6 40840.80
ETP Electrification 1415368.00 118,537.07 48108.35 1582013.42
Installation,
commissioning and
Painting 162951.00
16,7
83.95 16,783.95 196518.90
E 1000 DIGITAL
ENERGY METER 24700.00 3,087.50 27787.50
LOAD MANAGER 17100.00 2,137.50 19237.50
WIRING ENERGY
METER 8550.00 1,068.75 9618.75
SELF CONTAINED
BRATHING
APPARATUS SET. 1.00 1,000.00 1001.00
SOFTNER TANK
GUTTER SLOPE
WORK 283000.00 0.00 283000.00
M.S. PIPE 2''. 96200.00 4,810.00 101010.00
M.S. PIPE 3''. 7380.00 369 7749.00
M.S ELBOW 2 ''. 114.00 5.7 119.70
M.S ELBOW 3''. 274.00 13.7 287.70
M.S SHEET
8MM(205KG PER
SHEET). 18450.00 922.5 19372.50
ANCHOR FASTNER
6'' LENGTH. 8000.00 400 8400.00
WHITE BOARD4 X4. 3440.00 430 3870.00
AIR 85333.32 10,666.67 95999.99
Ganesh S. Bhat/SIMS/MMS/2010-11 43
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Budget & Budgetary Control Analysis in PepsiCoCONDITIONING.
INSTALLATION 30000.00 0 30000.00
ADAPTOR/PISTON
NUT SPANNER
1903587413 340.76 42.6 383.36
ENERGY SERVICE
PANEL 8911.00
91
7.83 917.83 10746.66
BOILER SAFETY &
EFF MONITORING
SYS. 1124379.00
115,8
11.14 155,023.77
10,000.0
0 2,092.82 78832.5 1486139.23
Receiver & liquid line
valve 504400.00 63,050.00 7,000.00 28,512.00 602962.00
400.00 0 400.00
Electric Forklift truck -
Drum Lifter 1021900.00
3,1
57.65 141,289.08 7,000.00 70,323.10 1243669.83
BATTERY
CHARGER 43800.00 5,475.00 2,409.00 51684.00
Safety system solution 450000.00
60,7
50.00 60,750.00
10,000.0
0 22500 30,428.75 634428.75
FABRICATATION &
INSTALLATION 73300.00
7,5
49.90 7,549.90 88399.80
IBR APPROVED
MATERIAL FOR
AUTOMATIC BLOW 54100.00 2,705.00 56805.00
IBR APPROVED
MATERIAL FOR
PIPE LINE 40800.00 2,040.00 42840.00
ETP UPGRATION
WORK - MOTOR
PUMP MODIFICA 115000.00 0.00 115000.00
HI WALL TYPE
SPLIT UNIT 24888.89 3,111.11 1,368.89 29368.89
HI WALL TYPE
SPLIT UNIT 101337.00 12,667.13 5,573.54 119577.67
ERECTION
CHARGES 61287.00
6,3
12.56 6,312.56 73912.12
supply of cabling REF 20940.00 2,617.50 1,151.70 24709.20
supply of cabling ref
piping for 2 TR 98000.00 12,250.00 5,390.00 115640.00
PROJECTOR LV
7280 XGA 42000.00 5,250.00 47250.00
PANEL -300 KVR
pannel unloading
13500.00 0.00 13500.00
Ganesh S. Bhat/SIMS/MMS/2010-11 44
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Budget & Budgetary Control Analysis in PepsiCocharges
4 square mm,4 core
cable 45600.00 2,280.00 47880.00
32 A MCB with box,2
pole socket and top 2460.00 307.5 2767.50
25A MCB with box 2
pole socket 4920.00 615 5535.00
SERVICES 61400.00 0.00 61400.00
MS FLAT
300*16MM. 13000.00 650.00 13650.00
SELF CONTAINED
BRATHING
APPARATUS SET. 45400.00 5,675.00 1,000.00 52075.00
CC TV SYSTEM SET 31289.00 3,911.13 35200.13
Installation charges 3520.00 0.00 3520.00
Expected
Cost/Expenditure
20810160.4
2
453,3
64.85
1,976,60
8.44 130000 22500 12,994.07
731,361.2
1
247,26
9.89 24384258.88
Material description Basic ED VAT Freight
Unload
Ch
Insuranc
e Octroi
Service
tax Total
CAMERA VISION
SYSTEM
SERVO BASED
REJECTION
MECHANISUM
DATA LOGGING
SYSTEM CAMERA
VISION
UPS SYSTEM FOR DATE
LOGGING.
Autoscrubber elect. M/c
243,9
35.00 30,491.88 274,426.88
tASKI vACUMAT22 33,4 22,254.13 55,735.62
Ganesh S. Bhat/SIMS/MMS/2010-11 45
Actual cost/Experience occurred during the year2010-11:
Page 46
Budget & Budgetary Control Analysis in PepsiCo230V/50HZ 81.49
HIGH PRESSURE WATER
JET
71,6
79.12 22,254.13 93,933.25
TASKI DORSALINO 230V
50 HZ
39,9
11.62 22,254.13 62,165.75
PICOBELLO 151
32,9
60.80 22,254.13 55,214.93
-
PCC ROOM PIPE WORKS 3,00,000 0.00 -
-
FILLED INSPECTION
STATION -
Installation &
Commissioning -
-
Testo 875-2 thermal imager 2,84,050 35,506.25 35,506.25
SPEED RETARDER -
CONVEX MIRROR -
ISMB 200
68,5
80.00 35935.41 104,515.41
ISMC 120 X 75
184,1
40.00 184,140.00
ISMC 200
41,7
60.00 41,760.00
ISMC 100 X 50
86,9
40.00 86,940.00
MS PLATE GUSSET 12
MM THK
35,1
53.10 35,153.10
TOE GUARD MS FLAT
22,5
00.00 22,500.00
ISA 75 X 75 X 6 MM
7,3
35.00 7,335.00
ROD 16 MM DIA
2,2
50.00 2,250.00
CHARGER PLATE 4 MM.
915,1
00.00 915,100.00
RAILLING PIPE 32 NB
110,5
50.00 110,550.00
MS ELBOW 32 NB
16,2
00.00 16,200.00
M 16 NUT BOLTS 60 MM 1,4 1,440.00
Ganesh S. Bhat/SIMS/MMS/2010-11 46
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Budget & Budgetary Control Analysis in PepsiCo40.00
ANCHORE BOLT 16 X
100 MM LONG
3,8
40.00 Total 3,840.00
CHAIN PULLY BLOCK
12,0
00.00 12,000.00
CHAIN PULLY TROLLY
6,6
00.00 Balance 6,600.00
-
fabrication & erection
monorail at CT
487,8
24.00 49318.87 537,142.87
-
11 STAGE APEC PANEL -
300 KVR -
6 STAGE APFC PANEL
100 KVAR -
-
BIO-WASTE
CONVERTER
452,1
89.00 0 452,189.00
-
Providing & laying caustic
storage faci -
-
15 S MULTIMETER
20,6
62.50 4603.94 25,266.44
DIGITAL INSULATION
TESTER
16,1
69.00 4603.94 20,772.94
AC TONG TESTER -
PORTABLE POWER
ANALYSER
104,5
00.00 13062.5 117,562.50
MOTOR CHEKER
15,6
75.00 1959.38 17,634.38
-
Receiver & liquid line valve -
-
Revamping of UASB ETP
820,0
00.00 102500 922,500.00
Erection & commissioning -
FABRICATION &
INSTALLATION HP
MONORAIL
328,0
79.78 33792.22
ISMB 250 38,0 17637
Ganesh S. Bhat/SIMS/MMS/2010-11 47
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Budget & Budgetary Control Analysis in PepsiCo25.00
ISMC 150 X 75
110,7
00.00
MS PLATE 12 MM THK
5,6
25.00
ISMC 100 X 50
7,4
25.00
MS FLAT 100 X 6 MM
8,7
75.00
ISA 75 X 75 X 6 MM
3,6
00.00
ROD 16 MM DIA
2,2
50.00
CHAQUIRE PLATE 4 MM
46,8
00.00
RAILING PIPE 32 NB.
56,1
00.00
MS ELBOW.
6,3
00.00
M 16 NUT BOLT
6
00.00
anchor bolt 16 x 100 mm
1,6
00.00
CHAIN PULLY.
36,0
00.00
CHAIN PULLY TROLY.
13,0
00.00
UG TANK FENCING
WORK
BOILER SAFETY & EFF
MONITORING SYS.
Heavy duty platform trolly
10 Feet
192,0
00.00 79650 11880
Tltable tower ladder ES-
TTL-H 40 Feet
225,0
00.00 25000 15296.88
Maintenance Trolley ES-
MTHD_H 6 feet
151,2
00.00 9355.5
LADDER FIBER 18 FEET
69,0
00.00 2894.62
Ganesh S. Bhat/SIMS/MMS/2010-11 48
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Budget & Budgetary Control Analysis in PepsiCoENERGY SAVER 3 PH 415
VOLTS 50 HZ
240,0
00.00 4800 10000 14564
INSTALLATION &
COMM
10,0
00.00
MCC CONTROL PANEL
WITH DOL STARTER
753,5
14.80 0
Equalisation pump KGEC
14-8
35,1
62.56 0 2062.73
Equalisation pump Motor
27,3
58.00 0 1723.25
Equalisation pump Access
& Matching Flan
17,3
89.87 0 972.06
UASB PUMP KGEC 12B-5
29,1
52.52 0 1710.17
UASB PUMP KGEC 12B-5
MOTOR.
14,5
35.21 18.16.90 918.13
UASB PUMP ACCESS &
FLANGE
13,2
19.37 1652.42 744.63
CLARIFIER PUMP FRE
80-210
118,1
95.38 0 6933.66
CLARIFIER PUMP
MOTOR
19,6
09.41 0 1231.23
CLARIFIER PUMP
ACCESS & FLANGE
19,3
20.62 0 1080.27
GARDENING PUMP
KGEC 16-6
36,7
36.38 0 2155.06
GARDENING PUMP
MOTOR
27,3
58.00 0 1717.75
GARDENING PUMP
ACCESS & FLANG
17,2
80.87 966.56
Tursury treatment pump CN
40-160
35,3
60.54 0 2074.34
Tursury treatment pump
MOTOR.
17,8
42.08 0 1120.26
Tursury treatment pump
ACCESS & FLANGE
15,2
53.12 852.847
wATER PUMP KGEC 16-6
36,7
36.38 2155.06
wATER PUMP KGEC 16-6 27,3 0 1717.75
Ganesh S. Bhat/SIMS/MMS/2010-11 49
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Budget & Budgetary Control Analysis in PepsiCo
MOTOR 58.00
wATER PUMP KGEC
ACCESS & FLANGE
17,2
86.87 0 966.56
Mechnical Seal cn 40-160
17,2
86.87 0 966.56
32068.877
light curtain
31,5
00.00 5737.5
AF 20MR D
11,7
00.00
POWER SUPPLY PS230
2,7
00.00
M & w COUNTER
COMPLETE SET
22,1
45.00 461.41 950
RELAY 24 V
8
75.00
DIGITAL ENERGY
METER E 1000
6,1
75.00 9992.84
DIGITAL ENERGY
METER ENTITY VER 1.0
14,107.50
2,3
51.25
DIGITAL ENERGY
METER ENTITY VER 1.0
3,135.00
DIGITAL ENERGY
METER ENTITY VER 1.0
9,975.00
DIGITAL LOAD
MANAGER
11,4
00.00
ENERGY METER WITH
PANEL
8,0
75.00
CURRENT
TRANSFORMER
5,7
00.00
WIRING OF ENERGY
METER
1,4
25.00
MAKING CUTOUT
WIRING
19,9
50.00
PROVIDING & FIXING
EYE WASHER
164,2
25.00 0
Blower fitting,cabeling,civil
Ganesh S. Bhat/SIMS/MMS/2010-11 50
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Budget & Budgetary Control Analysis in PepsiCo
work
Providing & laying PVC
strip door
272,3
63.52 0
MCC CONTROL PANAEL
FOR WR PLANT
770,3
55.00 0 49794
DRONA PCH CHAIR.
86,2
50.38 27589.3
91,3
23.94
KAREENA CHAIR
GODREJ.
34,5
12.09
8,6
28.02
motor gaurd 10 HP
6,8
97.00 2889.31
MOTOR GAURD 7.5 HP
1,0
24.10
MOTOR GAURD 0.75 HP
2,0
37.75
MOTOR GAURD 3 HP
9
50.00
MOTOR GAURD 3.7 KW
1,0
24.10
MOTOR GAURD 15 KW
4,2
84.50
MOTOR GAURD 11KW
6,8
97.00
WTP PANEL WIRING &
INSTALLATION
DISCONNECTING AND
REMOVING WTP PANEL
MIS CONDITIONIONG OF
ELECTRICAL
Installation, commissioning
and Painting
ETP Electrification
15,3
68.00 166645.42 16783.95
Installation, commissioning
and Painting
162,9
51.00
E 1000 DIGITAL ENERGY
METER
12,3
50.00 1543.75
17,1
00.00 3681.25
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Budget & Budgetary Control Analysis in PepsiCo
LOAD MANAGER
17,1
00.00 3681.25
12,3
50.00 3681.25
WIRING ENERGY
METER
8,5
50.00 1068.75
SELF CONTAINED
BRATHING APPARATUS
SET.
SOFTNER TANK
GUTTER SLOPE WORK
283,0
00.00 0
M.S. PIPE 2''.
96,2
00.00 5179
M.S. PIPE 3''.
7,3
80.00
M.S ELBOW 2 ''.
1
14.00 419.4
M.S ELBOW 3''.
2
74.00
M.S SHEET 8MM(205KG
PER SHEET).
ANCHOR FASTNER 6''
LENGTH.
8,0
00.00
WHITE BOARD4 X4.
3,4
40.00 430
AIR CONDITIONING.
ADAPTOR/PISTON NUT
SPANNER 1903587413
3
40.76 528.57
ENERGY SERVICE
PANEL
8,9
11.00 917.83
BOILER SAFETY & EFF
MONITORING SYS.
Receiver & liquid line valve
Electric Forklift truck -
Drum Lifter
BATTERY CHARGER
Safety system solution
FABRICATATION &
INSTALLATION
IBR APPROVED
MATERIAL FOR
AUTOMATIC BLOW
Ganesh S. Bhat/SIMS/MMS/2010-11 52
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Budget & Budgetary Control Analysis in PepsiCoIBR APPROVED
MATERIAL FOR PIPE
LINE
ETP UPGRATION WORK
- MOTOR PUMP
MODIFICA
HI WALL TYPE SPLIT
UNIT
HI WALL TYPE SPLIT
UNIT
ERECTION CHARGES
supply of cabling REF
supply of cabling ref piping
for 2 TR
PROJECTOR LV 7280
XGA
42,0
00.00 5250
PANEL -300 KVR pannel
unloading charges
13,5
00.00 0
4 square mm,4 core cable
45,6
00.00 3202.5
32 A MCB with box,2 pole
socket and top
2,4
60.00
25A MCB with box 2 pole
socket
4,9
20.00
SERVICES
MS FLAT 300*16MM.
SELF CONTAINED
BRATHING APPARATUS
SET.
CC TV SYSTEM SET
Installation charges
Actual
Cost/Expenditure 9,065,3
07.17
- 747429.66 35950 167922.754 16783.95 4,220,374.32
Ganesh S. Bhat/SIMS/MMS/2010-11 53
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Budget & Budgetary Control Analysis in PepsiCo
I have taken last year’s data (eg.2010-11) for the analysis of Budget of the PepsiCo Because of some
Confidentiality of the Company
Expenses Head
expected
Expenditure
Actual
Expenditure Variances
Basic cost 20,810,160.42 41,009,760.84 -20,199,600.42
Edu.Cess 453,364.85 41,047,920.84 -40,594,555.99
Vat 1,976,608.44 747,429.66 -20,199,600.42
Fright 130,000.00 260,000.00 -130,000.00
Unload ch. 22,500.00 0.00 22,500.00
Trans. Insrnce 12,994.07 0.00 12,994.07
Octroi 731,361.21 1,404,871.16 -673,509.95
Service Tax 247,269.89 494,539.78 -247,269.89
Total 24,384,258.88 4,220,374.32 -20,199,600.42
Ganesh S. Bhat/SIMS/MMS/2010-11 54
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Budget & Budgetary Control Analysis in PepsiCo
Basic
cost
Edu.C
ess
Vat
Fright
Unloa
d ch.
Trans
. Ins
rnce
Octrai
Serv
ice T
axTot
al0.00
5,000,000.00
10,000,000.00
15,000,000.00
20,000,000.00
25,000,000.00
30,000,000.00
35,000,000.00
40,000,000.00
45,000,000.00
Expenditure 2010-11
Expeted cost
Actual Exp. Cost
Zero-based budgeting:
The PepsiCo follows Zero-Based Budgeting Technique for preparation of the Company budget.
The technique of zero base budgeting provides a solution for overcoming the limitations of
traditional budgeting by enabling top management to focus on priorities, key areas and alternatives
of action throughout the organization.
Zero base budgeting, as the term suggests, examines or reviews a program or function or
responsibility from ’scratch’, The reviewer proceeds on the assumption that nothing is to be allowed.
The manager proposing the activity has, therefore, to justify that the activity is essential and the
various amounts asked for are reasonable taking into account the outputs or results or volume of
activity envisaged. No activity or expense is allowed simply because it was being allowed or done in
the past. Thus, according to this technique each program, whether new or existing, must be justified
in its entirety each time a new budget is formulated.
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Budget & Budgetary Control Analysis in PepsiCo
Advantages:
i. dealing with practically all elements of managers’ budget requests
ii. critical examination of ongoing activities along with the newly proposed activities
iii. Providing each manager a range of choices in setting priorities in respect of different
activities and in allocating resources.
iv. Efficient allocation of resources, as it is based on needs and benefits rather than history.
v. Drives managers to find cost effective ways to improve operations.
vi. Detects inflated budgets.
vii. Increases staff motivation by providing greater initiative and responsibility in decision-
making.
viii. Increases communication and coordination within the organization.
ix. Identifies and eliminates wasteful and obsolete operations.
x. Identifies opportunities for outsourcing.
xi. Forces cost centers to identify their mission and their relationship to overall goals.
xii. It helps in identifying areas of wasteful expenditure and, if desired, it can also be used for
suggesting alternative courses of action.
Disadvantages:
I. More time-consuming than incremental budgeting.
II. Justifying every line item can be problematic for departments with intangible outputs.
III. Requires specific training, due to increased complexity vs. incremental budgeting.
IV. In a large organization, the amount of information backing up the budgeting process may be
overwhelming.
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Budget & Budgetary Control Analysis in PepsiCo
Limitation of the study:
This study work was based on primary data collected from available source. The study area was limited to
Mumbai and the findings may not be applicable to other markets, as vast difference exists among the
consumers with regard to demographic and psychographic characteristics.
i. The study has not been intended on a very large scale, have the possibility of errors, which cannot be
ruled out.
ii. Time was restricted to the 8 weeks had been found inadequate to gain the knowledge &
gather sufficient information about the financial operation of the Company.
iii. Due to some sort of confidentiality of the PepsiCo, the management unable to disclose
Extract Figures of Variances and some other Financial Data
iv. There are other factors which affect to the budgeting & operation process such inflation,
unavailability of row material.
v. Some of the respondents were not co-operative & many seem to be having no interest.
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Budget & Budgetary Control Analysis in PepsiCo
RECOMMENDATIONS AND SUGGESTIONS:
After the visit and while preparing this report I think there are certain things that the company should
take care of.
1) The budget should be review properly on monthly and quarterly basis to analyze
the flow of operation process.
It has been witnessed that the actual targets achieved year on year basis, vary widely from the
budgeted estimates and revised estimates. In lieu of this anomaly, it can be said that the month and
quarter wise physical targets breakups and corresponding budget allocations need to be fixed with a
clear vision and proper planning.
2) Better response towards market volatility
In the recent volatile market condition high fluctuating food & beverage prices indicate that
expecting a hundred percent accuracy in line with the estimates is harsh on the company. However if
Ganesh S. Bhat/SIMS/MMS/2010-11 58
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Budget & Budgetary Control Analysis in PepsiCo
predetermined response system is in place then market volatility won’t remain a deterrent and the
company would be better prepared to achieve its projected aggressive guidance.
3) Accountability of the fund centre
The reason of the unachievement or underachievement of physical targets in a given year is due to
the late release or lack of sufficient funds at various fund centers. Thus for faster achievement of
targets smooth flow of funds is required which can only be implemented when the various fund
centre are held accountable. The availability of the fund should review by the fund centre monthly
and quarterly basis.
4) Budgeted estimates preparation should more realistic in the nature
The Budgeted estimates that are prepared for the next year allocations need to make on more
realistic assumption through proper forecasting of the future market trends and availability of R&D
and technology during the period for which the estimates are being made. It should based on the
capability of the Company to achieve target goal.
5) Channelize the whole process through Use of SAP
Budget is meant more for controlling than for meeting financial needs as and when they arise.
Therefore proper control mechanism needs to be installed which can minimize deviations in
practicality. The budget software presently being used at PepsiCo just fixes the initial outlays and
targets. These targets are then fed into the SAP software in order to monitor the achieved progress.
This creates duplicity in the budget preparation. Some of the Workers are not that much expert to
handle the SAP software. So its need to give proper training to the workers. Hence a better option
would be to channelize the whole process of budget preparation and operation through SAP only as
this software provides lesser room for deviations and hence better monitoring.
6) Proper monitoring of all services-In
Order to have micro monitoring in place, proper supervision of each service can be helpful. The
overall achievement, overachievement or underachievement records of the organization help, but if
proper achievement has to be monitored then performance of each service type needs to be done.
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Budget & Budgetary Control Analysis in PepsiCo
7) Focus of control – negative or positive variances
A matter of practical importance that has drawn frequent comment is the nearly universal tendency
to focus control effort on minimizing negative variances, in spite of the intellectual recognition that
equal effort applied to maximizing positive variances might be more productive.
8) Forecasting for Activity Cost Control
Company should focus upon future revenues, future costs and technical problems. Due to the high
competition in the market, manager should focus on the optimum utilization of the available source
of fund. For this purpose, traditional financial accounting schemes are not adequate to reflect the
dynamic nature of a project. Accounts typically focus on recording routine costs and past
expenditures associated with activities.
9) Give priorities to the important works:
The manager should foretaste the priorities of works to be done in the future which is essential for
the business growth & expansion. Because some of the projects which not has been complete during
the financial year will affect to the revenue of the Company. Otherwise it will block the available
fund.
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Budget & Budgetary Control Analysis in PepsiCo
Conclusion
With the project subject title Budget & Budgetary Control Analysis, in PepsiCo we conclude
that Budgeting is the essential part of the every business organization. Budgeting helps to
calculate the estimated expenditure, revenue for the future period of organization. Preparation
of the budget is very essential part of the organization. So it necessary it should be prepare
appropriately with the proper analysis of past records & financial data. While budget is
prepare the manager should focus on future goals & aims of the company which helps to know
the key area which need to improve for growth & expansion of the company. For the growth &
expansion of the Business manager should prepare in the real manner on the basis of External
Environment Factor which always affect to the business.
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BIBLIOGRAPHY
I took certain references and various help while preparing the project. The Google was the main
source from where we found the information. The list of URLs used for the reference is listed below:
www.pepsiCo.com
www.pepsiCoindia,com
www.wikipedia.com
www.encyclopedia.com
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