COMSATS INSTITUTE OF INFORMATION & TECHNOLOGY Submitted To: Sir WaqarAhmedSubmitted By: Hassan Bakhtiar Roy FA08-MBA-039/LHRACKNOWLEDGEMENT Up and above anything else, all praise to Almighty Allah alone, the Omnipresent and the most Merciful and compassionate. The words are bound, knowledge is limited and time is short to express His dignity. It is one of infinite blessings of Allah that he b estowed me with the potential and ability to contribution towards the deep oceans ofknowledge already existing. I pay hum-age to greatest personality of the universe; HOLY PROPHET HAZARAT MUHAMMAD (PBUH) who is forever source and spring of guidance in every sphere of life. At the very outset, I would like to express my hearties and sincerest sense of gratitude to all my worthy teachers of
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Up and above anything else, all praise to Almighty Allahalone, the Omnipresent and the most Merciful andcompassionate. The words are bound, knowledge is limitedand time is short to express His dignity. It is one of infinite
blessings of Allah that he bestowed me with the potentialand ability to contribution towards the deep oceans of knowledge already existing.
I pay hum-age to greatest personality of theuniverse; HOLY PROPHET HAZARAT
MUHAMMAD (PBUH) who is forever source and springof guidance in every sphere of life.
At the very outset, I would like to express my hearties andsincerest sense of gratitude to all my worthy teachers of
CIIT Lahore for their inspiring guidance and constructivecriticism.
I am highly thankful for the cooperation of Mr. Bilal Niazi,
Mr. Wasim Omer, Mr. Rizwan Malik, Mr. Tahir
Mehmood, Mr. Nouman Chatha and Mr. Kashif Niaziof Colony Industries (Pvt.) Ltd. I might not be able tocomplete my internship without their cooperation and kind
behavior. I am also gratified to all my sincere fellows who Ihad ever remembered for their continued encouragementmoral support and invaluable succor as well as substantialcooperation during my critical moments.
The organization structure and the details of itsmanagement along with its location are also discussed. Ihave also discussed the yarn manufacturing procedure andthe important departments of the company. I havediscussed some business operations and some strategies aswell.
The second section provides information about theactivities that I performed during the internship. I workedas an internee mainly in Accounts and Marketingdepartment. However, I also spent some time in PurchaseDepartment to gather some information about their working.
The third and last section includes the recommendations.
Textile Industry in Pakistan The subcontinent is the inheritor of one of the richest andoldest textile traditions in the world. Excavations atMohenjo Daro and Harappa 2500-1500 BC revealed thatthe inhabitants of the Indus Valley cultivated cotton. Sir John Marshall, the archaeologist has stated that a fewminute scraps of cotton were found adhering to the side of
a silver vase. Clay and faience spindles whorls indicate thatcotton and woolen fibers were spun. A well-equippeddyers’ workshop was excavated at Mohenjo Daro and thefragment of cloth indicates that woven cotton cloth wasdyed with madder root.
Independence from the British in 1947 and the division of the Indian subcontinent into Pakistan and India started a
new era for textiles production. Pakistan consisted of twoentities, east and West Pakistan. The West was the cotton
producing area and the East was responsible for jute production. At the time of partition, Pakistan had noindustrial base and inherited only one textile mill, theLyallpur Cotton Mill in Lyallpur [now called Faisalabad].This mill produced yarn and gray cloth and no printedfabrics.
Under the Open General Licensing [OGL] scheme, the business community imported plants and machinery withcash dollars. In 1950, Adamjee Mills was set up in Karachi,Kohinoor in Faisalabad, Colony Textile Mills in Multan,
Nishat and Crescent Textile in Faisalabad. These werefollowed by Gul Ahmed Textile Mills, Al-Karam, Valika,Star and Rashid textile mills.
Within a decade the new country of Pakistan was self-sufficient in cotton and began exporting gray cloth and later cotton yarn. Pakistan started exporting printed fabrics in thelate 1970’s to Africa and by mid 80’s was sending printedmaterial to Europe. Pakistan’s location was ideal, as it layhalfway between the western world and the Far East.Pakistan has a 28 percent share in world export of cottonyarn and a 6 percent share in world export of cotton cloth.
It was in the 60s that the power loom took over and by the70s gray cloth was being exported at throwaway prices.There are about 200,000 power looms operating in Pakistansome of which are backyard operations. Handloom, whichformed the backbone of textile goods in the last century, isnow almost non-existent, its sales confined to a fastdiminishing rural market and a very small niche market.
Although Pakistan is the world’s fourth largest cottongrowing nation in the world, after the United States, China,and India, its total turnover for export is only $ 5 billion.Textile goods form 60 % of the total exports of the country.The commodities exported are yarn, cloth, tents, andcanvas, bags, towels, bed linen, garments, synthetic textilesand other made ups.
Colony Textile soon became one of the largest verticallyintegrated textile facilities in the country. The group further diversified in to Power Generation and Distributionnetwork, Banking, Insurance, and Cement sectors. Thesuccess of the group continued until the government regimeshift brought about a shift in policy from private sector
pushed industrialization to a strong wave of nationalization.The Ginning, Flour Milling, Power, Banking, Insuranceand Cement along with various other sectors werecompletely taken over by the government.
Having major assets nationalized, the Group was facedwith severe financial difficulties for almost one and a half decades.
Presently, the Colony Group consists of several TextileSpinning facilities with an installed capacity in excess of 220,000 spindles out of which more than 200,000 spindlesare 4 years old or less.
Colony group is managing the following companies:
Company Name Line of Business Status
Colony Textile Mills Limited Textile (Spinning) Public Limited Company
Colony Textile Mills Limited, one of the group companiesof the Colony Group, is a Textile Manufacturing unitestablished as on 24th August, 1946 and engaged in manufacturing of yarns of various
Ne Counts. The company has authorized capital of Rs. 411,000,000 as on September 30th 2008.
During year 2000 to 2001 the annual production capacity of the company was 34.813 million Kg’s converted into 20 NeCount based on 111,136 spindles. Currently the number of spindles installed has been increased to over 175,000spindles.
The owners of CTML are one of the r ichest persons of the Pakistan and they have more plant and
investment in other industries like Sugar Mills, and Share Market. They have adequate financial
resources to meet their requirements.
Competitive advantage
Because it is an old textile originating from 1950’s and it has still kept its position in the textile market
on all competitors nationwide, which is its competitive advantage.
Own Power Generation Plant
They have own power generation plant and CTML is the pioneer in the private organization who start
the power generation.
Weaknesses:
High cost of production
The production cost is high because of un-proper utilization of resources.
Centralized decision making
The decisions are made by the upper management which is weakness of the CTML because they havenot any proper idea about the prevailing situation and their decision can be un-fruitful for the company.
Less promotional activities
The advertising and promotional cost of the CTML is very low it can take advantage for more turn
outs.
Opportunity:
Organization can expand Product Lines
Currently the CTML is not dealing in knitwear they can expand their product line by producing
knitwear. They have plants and the extra cost for the production will be low for CTML. They also have
At CTML, it is prospering due to i ts professional commitment towards excellence and giving the best
results at all times and against all odds. Its marketing and production team co-ordinates all the time and
its focus remains on maintaining its position as the market leader in the textile sector of Pakistan.
Competitive Strategy
As for as COLONY Group is concerned its own name is its competitive advantage. Being an old group
it has its own name in the field of Textile as well as sugar. As I have told in the above segment that it
has business of Methane gas in Europe it is its competitive advantage. As dealing in one different side
gives you edge over competitors in other field.
Furthermore, its financial assets are also an edge for the group. As being late in paying any party makes
future problems which result in delivery of any product to be late and resulting in bad image of the
company.
COLONY group buys raw material from all the groups like Nishat, Sitara Textiles, Kohinoor Textiles
and many more companies like that I cannot name all of them as it is a huge number. Which
automatically makes links better and which tells its mostly products are exported. And for sure they are
of finest quality.
It’s one competitor is the Rupali group.
PURCHASE ACCOUNTING SYSTEM
For abbreviations see Glossary:
Purchase Procedure for Mill
When a Floor Shop in-charge (Foreman on the maintenanceand Head Jobber on the Production side) needs to purchaseone or more items to facilitate his sphere of work, he willfill out a PDN. A copy of PDN used in our companyappears in Appendix 999. The PDN has three leafs. Firstcopy is for the Purchase Department, second for the Storeat Mill, and third for the Department originating the
demand. A good quality Carbon Paper should be used sothat even the last copy is legible.
At the initial stage there are six columns that are filled bythe authorized staff of the concerned Department/Section.
Those six columns being Department, Sr. #, Item Code,Description, UOM, and Quantity Demanded.
The company is divided in to five ConsumptionDepartments. This division is done in order to simplifyidentification of consumption patterns, allocation andanalysis of wages & salaries, and convenience inBudgeting. The Departments namely are:
Sr. # Departments Code
1) Head Office 01-00
2) Administration 02-00
3) Spinning 03-00
4) Services 04-00
5) Residential Colony 05-00
The Department/Section code format adopted by our company is 99-99.
99-99
Department Section
Main Departments always have “00” in place of sectiondesignator. For example, 02-02 signifies that
the Department is Administration and the Section is TimeOffice. However, when we want to refer to theAdministration Department the code used will be “02-00”,meaning that the code relates to a Main Department.
A Store Item Code List (SICL) sorted on Item Code as wellas Description also containing the Unit of Measure (UOM)
of each item in front of the Description is supplied to theStore In-charge, Manager (P&A), Electric Engineer, MillsManager at the Mill, and Purchase Officer at the HOL.
New Items added to Store Inventory (SI) from time to timewill be added manually to the list by those who have beenissued the SICL. At the beginning of every Quarter a newSICL be issued to all concerned.
PDN No.: This is a sequentially controlled five digitdistinct number allocated to each PDN document.
Starting with 00001 to the first PDN of the financial year up to 99999 during that financial year.PDN numbers iscontrolled by the Store In charge in the PDN Number Control Register. If HOL issues a PDN, the Purchase
Officer will ask the Store In charge to allocate his demanda PDN Number. Next number in sequence will be allocatedwhich will be written on the PDN by the Purchase Officer.The Store In charge will make a note of this that the PDNwas made by the HOL staff.
Department: The Section that makes the PDN fills-in itscomplete code. If Ring Maintenance is filling the form, itwill enter the code 03-10 signifying that Sub-Section “RingMaintenance” of Spinning Department is demanding whatis endorsed in the PDN. The Sub-Section’s description will
be written in front of the blank space provided for description. The Main Department’s name will not bementioned in this space.
Sr. No.: The first column to be filled in a PDN will beSerial Number that appears in an abbreviated form (Sr.
No.). Under this head, a whole-number in a sequentialorder will be filled-in for keeping a count of itemdemanded in a particular PDN. It will always start from 1and go up to a maximum of 9, as there is a provision of only 9 rows in a PDN for entry of items.
Item Code: For various reasons including statisticalanalysis and MIS the Item Code has been broken into threenumeric parts, each part separated by a dash “-”.
The Item Code adopted in our organization is in the format99-99-999. Store Code combines with the Item Code toform the ITEM CODE.
99-99-999
Store Section Item Number
Store Sub-Section
PROCESS OF YARN
PRODUCTON
See figure in Annexure 1.3
Production manager services the daily production schedulesand try to work according to the demand to schedule. Thereare many steps involved in production of the yarn.
BLOW ROOM
The first step is that the raw cotton is sent to Blow room for the quality of the cotton. Then it is sent to the Lab for quality check. Here basic quality and other contents arechecked in proper form. If one kg cotton is put into thisroom only 600 grams cotton goes into further production
process and rest goes in wastes. Here following are wastesexcluded,
B/R Gutter
Dropping
CARDING
In this step the cotton is carded. The production manager checks the cotton and it comes in the drums typecontainers. These drums rotate and cotton comes out in
specific form called as “pones”. Here about 5% cotton goesin the shape of waste. Waste extracts from this process arecalled by;
Card fly
COMBING
In this step the cotton goes for combing. Combing is a process to comb and wax the cotton for softness purpose.Following wastes are excluded from cotton in this process;
Short Fiber
Comber Noel
SIMPLEX
After the attaining of Cotton from Card and Comb processes, which is also weak this is further passed back to blow room process called Roving and then cotton is sent toRing process.
RING
In this step small pones are developed for further processand wastes are made out named;
Phnemaphil
AUTOCONING
In this step the manager in specific intervals checks thequality of carded pones from which yarn is produced inshape of cones by passing through machines for this
purpose. Here also some wastes are extract called;
Cones manufactured in proceeding step are now kept inmoisturize room for absorbing required moisture. Cones are
packed into bags or cartoon according to customer requirements.
PURCHASE DEPARTMENT
The purchase department makes all purchases. Everydemand from different departments for different items isforwarded to store and from here it is forwarded to
purchase department if needed to purchase. It has a mainstore in factory.
WORK DONE DURING INTERNSHIP
During my internship, I worked in the followingdepartments.
• Accounts
• Marketing
Account department
In account department, I managed to understand the flow of transaction, preparation of vouchers and ledger posting.
Preparation of vouchers
In account department under the supervision of concernedofficers, I came to know different type of vouchers being
prepared and their process of preparation. Vouchers arewritten evidence of any business transaction. The differenttype of vouchers being prepared by the account departmentof CTML is as under,
Being a public limited company cash payment vouchers areused for recording the expense of less than five thousand.These types of vouchers are prepared when cash paymentsare made against small expenses i.e. repair, entertainmentetc. in order to record the expenses following entry is
passed:
Account code name of expense (debit) Amount
Cash account (credit) Amount
Evidence of expense is attached with the cash paymentvouchers.
Cash Receipt Vouchers
These types of vouchers are prepared when the cashier on behalf of the CTML is receiving cash. However, thesetypes of vouchers are small in quantity because majority of transactions are done by bank. On receipt of cash, cashier
prepared the cash received slip. Account officer preparesvoucher on the basis of cash receipt prepared by thecashier. In order to book the transaction the following entryis passed in the books.
As I have told above that I had prepared vouchers of different types. Then I used to take vouchers of Mr. Tahir,Miss Shazia and Mr. Ramzan to audit and brought back audited vouchers from the Audit. Copied cheques whose
payments were to be made on that day. Then I brought afew times Invoices for sales tax from marketingdepartment. Maintained record of filing with Mr. Farooqui.Then in Yarn Procurement I made worksheets for the
parties who do not have tax exemption certificate and their tax has to be deducted. Next in purchase department, I hadonly worked for filing their GRN’s and maintaining themin a serial manner. I have attended calls for a person notseat or else.
Accomplishments
As an Internee I have done all the works diligently which Ihave mentioned above. Instead I had done other works aswell which a person on the job never performs, likesomeone asks me to take vouchers from Audit like I amhis/her Assistant I had done that and never said no. As Ihave seen those employees which went to Audit and the
other asked to bring my vouchers as well and the personsays no I have my own work you should better go yourself.That is the thing which I wanted to share in this regard.
New Knowledge Acquired
One thing regarding new knowledge is what I have sharedin Accomplishments. Next one important thing regardingknowledge acquired is that what you are studying is not
related to the job duties you are doing are in future youhave to do honestly. You have to understand that work from start, in case of an employee leaving a company and
joining other he also will have to understand the work innew company. I have got a lot of sense regarding workingin an organization where everyone is working out for cutting your roots. How to work in a conservativeenvironment! How to behave in any situation! How tonegotiate with any person on job!
Problems Encountered
Well I don’t have to face as many problems as I will haveto face when I will go on job. First few days were hard but
I cannot say there was any problem. Employees there werevery cooperative and they asked me to ask as many timesabout a thing till you are not cleared about that. Theyguided me on every issue and asked me as/like a big
brother to learn as much as you can. I am really thankful toall of them.
This experience definitely effects my career positively. As I
would not have been come to know about the atmosphereof any organization, this experience has told me a lot aboutenvironment of organization and behavior of different typeof people. All of this edge goes to my Institute’s goodunderstanding about students future.
RECOMMENDATIO
NS
Colony Textile Mills Limited:
The first and most recommendation is to eliminate oneman show prevailing in the company
There must be a proper system for training of employees
and supervisors.
Importance should be given to employees’ turnover.
Different training courses should be arranged for the uplifting and improving the quality of work for employees.
There is also a problem of work overload for theemployees and it should be control properly so that theemployees are motivated. As I have seen employees
working till 8 PM. And I have come to know thatsometimes they work till 1 AM late night without anyincentive.
Employees should be paid extra for the work which theydo after working hours.