Cos Accounting(Final)

7/30/2019 Cos Accounting(Final)

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This is to certify that the undersigned have assessed and evaluated the project

submitted by student of M.Com. Part - I

(Semester I) for the academic year 2012-13. This project is original to the

best of our knowledge and has been accepted for Internal Assessment.

Name & Signature of Internal Examiner

Name & Signature of External Examiner

PRINCIPAL

Shri Sunil B. Mantri


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I, student of M.Com. (Part I) Roll No.: hereby

declare that the project titled

for the subject

submitted by me for SemesterI of the academic year 2012-13, is

based on actual work carried out by me under the guidance and supervision of

. I further state that this work is original and not submitted

anywhere else for any examination.

Place:

Date:

Name & Signature of Student


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ACKNOWLEDGEMENT

I am thankful to Karnataka Co-operative Milk Producers Federation (KMC) for giving me an

opportunity to conduct research work in their esteemed organization. I am honored to take

this opportunity to sincerely thankMr. Unni Krishnan, Assistant Manager, KMC, for his

keen interest, guidance, continuous encouragement, support and help throughout the period of

the project.

I wish to express my sincere gratitude to Prof. Kedar Bhide for having helped me get a

better perspective of the subject matter and conduct the study effectively.


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Executive Summary

Hassan Milk Union is the producer of milk and various milk

products and prepares a budget estimating the various expenses and

income for each financial year. The budget is prepared by the

accounts department in consultation with the various other

departments. However, the estimated figure does not match with the

actual figures always. Milk procurement is based on population of

milch animal, availability of green fodder. It is almost impossible to

predict the exact figures and so deviations are bound to occur. Thus, it

becomes necessary to identify the deviations and analyse the reasons

for the same. Thus, this study focuses on the calculation of the

deviation and ascertaining the reasons for the same.


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1.1ObjectivesAn effective budgeting system is very vital to the success of any organization. Thus a

detailed study on the budget and the budgetary system is being carried out with the following

objectives:1. The main objective is to study about the budgetary system which is being followed at

Hassan Milk Union and evaluate the same to know the limitations in the existing

system.

2. Computation and analysis of variances for the purpose of control and performanceevaluation.

3. Basis on which the yearly budgets are prepared and measures taken to control invariances.

Thus, the detail study on the budgetary control system would give a knowledge on

how controlling is carried out in an organization.

1.2Scope of the StudyThe study is extended to the accounts department of Hassan Milk Union. The data has

been collected for the financial year 2008-09 and has been analysed using pictorial diagrams

like graphs, bar and column charts etc. Most of the data has been collected from secondary

sources.

1.3Research MethodologyThe study is conducted at Hassan co-operative Milk Producers Societies union

Limited, which is situated at B M Road, Hassan over a period of 10 weeks.

1.4Data Collection Method

In order to fulfil the objectives of the study the data has been collected from both-

Primary Data Secondary Data

Primary Data

To generate primary data for the analysis, discussion was made with company

assistant manager of finance, accountants and other officials from the accounts department.


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The data collected from such discussions are coordinated, analyzed and integrated in this

study.

Secondary Data

For gathering secondary data various other sources were used, which are-

Different accounting records of the company Magazines and journals Internets and other publication

Limitations of the Study

There are bound to be certain limitations while carrying out a study in anorganisation.

Due to busy schedule of the employees, it was not possible to get access toeach and every, information.

Due to certain constraints, current data could not be disclosed.


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2.1 Introduction

One the primary functions of the management is planning. Most of the planning

relates to individual situations and individual proposals. However, this has to be

supplemented and reinforced by overall periodic planning followed by continuouscomparison of the actual performance with the planned performance. Budgetary control has,

therefore, become as essential tool of management for controlling costs and maximizing

Budget and Budgeting are concepts traceable to the bible days, precisely the days of

Joseph in Egypt. It was reported that nothing was given out of the treasure without a written

order. History has it that Joseph budgeted and stored grains which lasted the Egyptians

throughout the seven years of famine.

Budgets were first introduced in the 1920s as a tool to manage costs and cash flows in

large industrial organizations. Johnson states that it was during the 1960s that companies

began to use budgets to dictate what people needed to do. In the 1970s performance

improvement was based on meeting financial targets rather than effectiveness. Companies

then faced problems in the 1980s and 1990s when they were not willing to spend money on

innovations in order to stay with the rigid budgets; they were no longer concerned about how

customers were being treated; only meeting sales targets became essential.

Budgeting in business organizations is formally associated with the advent of

industrial capitalism for the industrial revolution of the eighteenth century, which presented a

challenge for industrial management.

Glautier and Under (1987) state that the emergence of scientific management

philosophy with its emphasis on detailed info as a basis for taking decision provided a

tremendous impetus for the development of management accounting and indeed budgeting

techniques.

However, budgeting at the early stage of its development was concerned with

preparing and presenting credible information to legitimize accountability and to permit

correct performance evaluation and consequently, rewards.

Over the years, the function and focus of budgeting has shifted considerably and

business organization became more complex and their environment became dynamic coupled

with the emergence trend, the term budget and budgeting have been differently defined and

examined by various scholars in several ways.

The Institute Of Cost and Management Accountants (UK) defines a budget as a

financial and/ or quantitative statement, prepared and approved prior to a defined period of


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time, of the policy to be pursued during that period for the purpose of attaining a given

objective. It may include income, expenditure and the employment of capital.

2.2 Elements of a Successful Budget PlanThe success of the budgeting process in an organization depends on the following

essential elements:

Accurate forecasting of business activities. Coordinating business activities. Communicating the budgets. Acceptance and cooperation. Reasonable flexibility. Providing a framework for evaluation.

2.3 Budgeting Process

The budgeting process varies widely from one organization to another. Differences in

management styles, organization objectives, structure of competition and such other factors

affect the procedures companies adopt in budget preparations. However, the common steps

are as follows:

Obtaining estimates of sales, production levels, expected costs and availabilityof resources from each sub-unit/division/department.

Coordinating estimates. Communicating the budget to responsible managers and the concerned

departments.

Implementing the budget plan. Reporting the interim progress towards budgeted objectives.

2.4 Fixed and Flexible Budgeting Fixed Budgeting

Fixed Budgeting

The Institute of Cost and Management Accountants, London, defines a fixed budget

as the budget which is designed to remain unchanged irrespective of the level of activity

actually attained. It is based on a single level of activity. Fixed budgets do not change when

production level changes. This budget is rarely used as the actual output is often significantly

different from the budgeted output.


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Flexible Budgeting

A flexible budget is a budget that is prepared for a range, i.e., for more than one level

of activity. It is a set of alternative budgets to different expected levels of activity. This

budget is also known as variable budget, dynamic budget, step budget, sliding scale budget,

expense formula budget and expense control budget. The underlying principle of a flexible

budget is that every business is dynamic, ever-changing and never static. A flexible budget

has the following features:

1. It covers a range of activity.

2. It is flexible and facilitates performance measurement and evaluation.

2.5 Types of Budget

Budgets are the end process of the budgeting process. The number and types of

budgets in a business enterprise depends on the size and nature of business. However, in a

manufacturing concern, the following budgets are generally prepared:

(A) Operating and Functional Budgets:

1. Sales budget.

2. Production budget.

3. Production cost budget.

(i) Direct material budget.

(ii) Direct labour budget.

(iii) Factory overhead budget.

4. Ending inventories budget.

5. Cost of goods sold budget.

6. Selling expense budget.

7. Administrative expense budget.

8. Budgeted income statement.

(B) Financial budgets:

1. Capital expenditure budget.

2. Research and development budget.

3. Cash budget.

4. Budgeted balance sheet.


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5. Budgeted statement of changes in financial position.

Sales Budget

The most important budget, which all other budgets are contingent upon, is the sales

budget. Sales budget forecasts the future sales. The information about past performance is the

starting point for sales forecasting. After collecting all relevant information sales budget is

prepared.

Production Budget

After preparing sales budget, the production budget is prepared. A production budget

is stated in physical units. It specifies the number of units of each product that must be

produced to satisfy the sales forecasts and to achieve the desired level of closing finished

goods inventory. Units to produce= budgeted sales + desired closing inventory of finished

goodsbeginning inventory of finished goods.

Production Cost Budget

A production cost budget summarizes material budget, labour budget, the factory

overhead budget and may be expressed and analysed by departments and or products.

Ending Inventories Budget

An inventory budget can be prepared to find out the values of direct materials and

finished goods inventory.

Cost of Goods Sold Budget

A cost of goods sold budget summarizes direct material, direct labour, factory

overhead and ending inventory.

Selling Expense Budget

This budget shows the budgeted cost of promoting sales for the budget period. It is

also known as marketing expense budget.

Administrative Expense Budget


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This budget covers the administrative costs for non-manufacturing business activities.

It contains expenses like directors remuneration, legal charges, audit fees, salaries, rent,

office expenses, postage, telephone etc.

Budgeted Income Statement

A budgeted income statement summarizes all the individual budgets, i.e., sales

budget, cost of goods sold budget, selling budget and administrative expense budget.

Capital Expenditure Budget

The budgeting of capital expenditure is one of the important areas of managerial

decisions. Capital expenditure budgets are prepared for both short and long- range projects

depending on the requirements of the business firm. Short- range projects are implemented

during the accounting period. Long-range projects are not executed in the current period; they

are expressed only in general terms. They become budget commitments only when the time

for their implementation approach

Cash Budget

A cash budget contains detailed estimates of cash receipts (cash inflows) and

disbursements (cash outflows) for the budget period or some other specific period. Such a

budget helps to ascertain the cash requirements needed for a plant or equipment expansion

programme. It shows the availability of funds for a given period of time and thus helps to

make financial decisions.

Projected Balance Sheet

A projected balance sheet represents the expected financial position at a particular

date. The projected balance sheet automatically determines the arithmetical accuracy of other

budgets since they are used in preparing the forecasted balance sheet.

Budgeted Statement of Changes in Financial Position

The projected statement of changes in financial position is usually prepared from data

in the budgeted income statement and changes between the projected balance sheet at the

beginning of the budget period and projected balance sheet at the end of the budget period.

This projected statement is very useful to management in the financial planning process.


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2.6 Budgetary Control

Budgetary control is a means of control in which the actual state affairs is compared

with the budget so that appropriate action may be taken with regard to any deviations before

it is too late. The use of a budget to control a firms activities is known as budgetary control.Budgetary control has the following main objectives:

1. To provide an organized procedure for planning. It provides a detailed plan of

action for a business over a definite period of time.

2. To coordinate all the activities of various departments of a business firm in such a

manner that the maximum profit will be achieved for the minimum use of resources.

3. To provide a means of determining the responsibility for all deviations from the

plan (budget) and to supply information on the basis of which necessary corrective action

may be taken. Thus, budgetary control has the objective of controlling cost.

2.6.1 Budgetary Control as a Management Tool

Budgetary control has become an essential tool of management for controlling costs

and maximizing profits. It may be conceived as one of the supreme examples of the

rationality in management. It is a useful management tool in comparing the current

performance with the pre-planned performance with a view to attain equilibrium between

ends and means, output and effort. It corrects the deviations from pre-planned path through

the media of observation, research planning, control and decision-making and thus helps in

the performance of the future activities in an orderly way. It uncovers uneconomies in

operations, weaknesses in the organization structure and minimizes wasteful spending. It acts

as a friend, philosopher and guide to the management. Its advantages to the management can

be summarized as follows:

i. Brings Economy in Working It brings efficiency and economy in theworking of the business enterprise. Budget helps to achieve a goal and attain

the target. The budget helps to bring about efficiency in the results.

ii. Establishes CoordinationIt coordinates the various divisions of a business,namely, the production, marketing, financial and administrative divisions. It

forces the executives to think and think as a group. This results in

smoother operation of the entire unit.


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iii. Guards Against Undue Optimism It guards against undue optimismleading to over-expansion because the targets are fixed by executives after a

careful thought.

iv. Acts as a Safety Signal It acts as a safety signal for the management. Itshows when to proceed cautiously and when manufacturing can be safely

undertaken. It serves as an automatic check on the judgment of the

executives as losses are revealed in time which is a caution to the

management to stop wastages.

v. Optimum Mix It helps management in obtaining the most profitablecombination of different factors of production. This results in a more

economical use of capital.

vi. Management by Exception Budgetary control reveals variations of actualperformance from budgeted performance. The variations point to the root

inefficiencies and thus enabling the management to consider only the items

that do not go according to plan and leave the others, i.e., to concentrate on

exceptions.

2.6.2 Effective Budgetary Control

In order to make the budgetary system really effective, the management should pay

attention to the following aspects:

Consultation with Non-financial Executives- The effective participation of non-

financial executives should be solicited in the formulation of the budget in order to make

each manager emotionally committed to the budget.

Total Corporate Exercise- Budgeting should be a total corporate exercise.

Piecemeal budgeting cannot be effective.

True Delegation of Authority and Responsibility- There should be a true

delegation of authority and responsibility beginning with top management itself. Each

executive should have maximum opportunity to take decisions within the scope of his/her

authority.

Past Experience- Past experience is a useful guide for the future. It is, therefore,

necessary that points revealed by past experience should be taken note of while formulating

plans for the future.


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Minimum Limits only- budget should be taken as only minimum and not the

maximum level of performance. However, budget should not be suffocating. Sufficient

freedom should be given to the concerned executives within the overall framework.

Good Reporting System- Budgeting cannot be successful unless there is a properfeed-back system. The reporting system should be so devised that it not only tells about major

variations but also the persons who are responsible for these variations. The causes for the

variances should be analyzed and the management should be kept informed about the major

and proper remedial measures should be taken by the management at appropriate level and

appropriate time.

2.6.3 Calculation of the Variances in Budgetary Control

Variances = Actual yearly totalBudgeted yearly total

% of variances = variance amount X 100

Budgeted yearly total

2.6.4 Limitations of Budgetary ControlThe budgetary control system is not a perfect tool. It has its own limitations which are

as follows:

Budgeting and Changing Economy- The preparation of a budget which gives arealistic position of the firms affairs under inflationary pressure and changing

government policies is really difficult. Thus, the accurate position of the

business cannot be estimated.

Time Factor- Accuracy in budgeting comes through experience. Managementmust not expect too much during the development period.

Not a Substitute for Management- Budget is only a management tool. Itcannot substitute management. Besides that no budgetary program can be

successful unless adequate arrangements are made for supervision and

administration.

Cooperation Required- The success of the budgetary control depends upon thewilling cooperation and teamwork. Budget officer must get co-operation from


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all departmental managers. These managers must feel the responsibility for

achieving or bettering departmental goals laid down in the budget.

3.1 Industry Scenario

India is called the country of villages where it covers nearly 70% of its total area. In

this relation we can say that Indian economy is base on rural activities and their development.

Therefore we have to give prime importance to the rural activities.

A dairy is a place for handling milk and milk products. Technology refers to the

application of scientific knowledge for practical purposes. Dairy technology has been defined

as that branch of dairy science which deals with the processing of milk and the milk products

on an industrial scale. In developed dairying countries such as the USA the year 1850 is seen

as the dividing line between farm and factory scale production. Various factors distribute to

this change in these countries such as the concentration of the population in cities where the

jobs are plentiful, rapid industrialization, improvement of transportation facilities,

development of machines etc., The rural areas are identified for the production, urban areas

are for the processing of the milk.

3.2 Origin of Dairying in India

Around 1500 BC to 2000 BC the Aryans were first to domesticate cattle. Use them for

tilling their land obtain milk to be consumed as food. Again it were Aryans who priced the

milk of a cow more than its meat, forbade its slaughter, created legends about it and even

worshipped it. Hindus even to this day consider cow as sacred. Besides it were only the East

(India/China) which domesticated buffalo as milch animal and succeeded so well that today,

more than half the total production of milk in India is obtained from buffalo.

Most of the farmers have one milk animal; they sell the milk through local milk

contractors or middlemen. These traders have always exploited the poor and uneducated milkproducers. It was in the late forties, when integrated approach for dairy development based on


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farmers owned milk co-operative was first adopted at Anand. The system includes milk

procurement productions and marketing through farmer co-operatives. In India, the market

milk technology may be considered to have commenced in1950 with the functioning of the

Central Dairy of Aarey Milk Colony and milk product technology in 1956 with the

establishment of AMUL dairy, Anand. The system of collective ownership, operation and

control of milk trade by farmers came to be known as ANAND PATTERN. Anand pattern

has given them an opportunity to have access to the modern technology. The Brand ' is the

household name for Pure and Fresh milk and milk products.

The premises institution is NDDB and IDC for application of the Anand pattern

throughout the country. The whole project under which replication was envisioned, is named

as operation flood. The success of Anand pattern depends as establishing a strong co

operative infrastructure at the grass root level, making economically viable to strengthen.

Dairy industry offers employment opportunity to the people so as to help the farmers

to get fair price of milk. The farmers are provided with medical facilities to their cattle. Milk

is becoming an alternative life line in our rural economy. With the advent of white revolution

that is SKHEERA KRANTI in the same pattern of Denmark and Holland.

Export of dairy products plays an important role in our foreign trade. It increases the

foreign exchange and national income of our country and also economic development of our

country.

3.3 History of Indian milk market industry:

Organized milk handling was made in India with the establishment of Military DairyFarms Handling of milk in co operative milk unions established all over the country

on a small scale in early stages.

Long distance refrigerated rail-transport of milk from Anand to Bombay since 1945. Pasteurization and bottling of milk on a large scale for organized distributed was

started at: Aarey - 1950 Calcutta - 1958 Delhi - 1959 Mumbai - 1961 Madras - 1963

Establishment of milk plants under the 3 year plans for dairy development all overIndia. They were taken up the dual object of increasing the national level of milk

consumption and ensuring better returns to the primary milk producer. Now India is

one of the richest milk producing country in the world. In 1999 it produced milk up to

770 laths tons and the milk valued up to 75000 cores and 13% of total production in

the world is produced by India itself.


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3.4 Dairy Industry in Karnataka

3.4.1 Background

In June 1974, an integrated project was launched in Karnataka to restructure and

reorganize the dairy industry on the co-operative principle and to lay foundation for a new

direction in dairy development. Work on the first ever, World Bank aided dairy development

project was initiated in 1975. Initially the project covered 8 southern districts of Karnataka

and Karnataka Dairy Development Corporation was set up to implement the project. Dairy

developmental activities was set up with dairy co operative societies at grass root level, milk

unions at the middle level and dairy development corporation at state level as an apex body

with the responsibility of implementing Rs.51 cores project. After the closure of operation

flood II the dairy development activities which continued under operation flood III ended on1996. The post operation flood works are financed by NDDB under different terms and

conditions.

KMF has 13 Milk Unions throughout the State which procure milk from Primary

Dairy Cooperative Societies (DCS) and distribute milk to the consumers in various

Towns/Cities/Rural markets in Karnataka.

The Federation has a Board consisting representatives of Milk Producers and the

Government nominees. The day to day functions of the Federation is managed by a group of

professional managers headed by the Managing Director.

Karnataka Cooperative Milk Producers' Federation Limited (KMF) is the Apex Body

in Karnataka representing Dairy Farmers' Co-operatives. It is the second largest dairy co-

operative amongst the dairy cooperatives in the country. In South India it stands first in terms

of procurement as well as sales. One of the core functions of the Federation is marketing of

Milk and Milk Products.


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Mother Dairy, Bangalore, a Unit of KMF, is set up by NDDB on 7.12.1984. The

Dairy which has expanded from 4LLPD to capacity of 7.00 LLPD has a unique nature of

homogenising the milk and selling to its consumers through 50 Automatic Bulk Vending

Booths, 83 Shoppers and 70 FRP tanks. The Dairy also caters Milk in sachets and Milk

Products through its 289 retailers. The average sale of milk per day is 2.60 Lakh litres during

the year 2008-09. The entire requirement of milk is procured from Kolar Milk Union. The

Dairy produces Butter, Ghee, Curds, and Ice Cream & Skim Milk Powder. The activities of

all the Departments at Mother Dairy are being carried out through an on- line computer

system

3.5 Profile of Hassan Co-Operative Milk Producers Societies Union Ltd.

3.5.1 Introduction

The Union was registered on 30th March 1977 with the operational jurisdiction

extended to 3 Districts namely Hassan, Kodagu &Chikkamagalur.

The Dairy was setup under the Operation Flood II & III and has a processing capacity

of 1.2 Lakh Litres of milk per day. The Union also has a Dairy at Kudige with a capacity of

50,000 litres per day which is the first Dairy in Karnataka State started during January 1955.

The Union has three Chilling Centres at Birur, Holenarasipur and channarayapatna

with chilling capacity of 20000 liters per day at Birur and Holenarasipura and 100000 liters

per day at Channarayapatna. The Union also produces Ghee, Peda, Curds, Khova and Butter

Milk. The Union procures on an average 4.07 Lakh litres of milk and sells 1.04 Lakh litres

per day. There are 5 Bulk Milk Coolers & 46 Automatic Milk Collection Units in the Union.

Hassan Dairy was established under the World Bank aid with an initial handling

capacity of 60,000 KGPD and was being managed by Karnataka dairy development

corporation. In the year 1987 with an idea of bringing all milk allied activities such as milk

procurement, milk processing and milk marketing the Hassan dairy and the Kudige dairy (the

first commission dairy plant) were handed over to Hassan Co operative Milk Producers

Societies Union. The integrated system of monitoring the milk procurement, processing and

marketing activities by milk producers themselves was established.

3.5.2 Mission Statement

Hassan milk union aims to render the best services at normal cost to its members to

increase milk production and produce good quality milk by paying remunerative price


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throughout the year, thereby improving their economic and social condition while ensuring

high quality milk and milk products to the delighted level of the consumers at competitive

price.

3.5.3 Vision Statement

The union thrives hard to adopt the modern and eco friendly technologies to produce

milk and milk products of international standards to make our presence prominent in the

global market.

3.5.4 Aims and Objectives

Hassan Co-Operative Milk Producers Societies Union is completely an autonomous

body consisting of representatives from milk producers as policy makers

To produce continuous and remunerative market for the surplus milk in the ruralareas.

To supply quality milk to customers in the urban areas at a competitive price. To provide the technical inputs necessary to produce good quality milk and to

facilitate increase in milk yield.

To provide self employment to rural folk and to make them economically selfsustainable by which the migration of rural folk to urban areas is minimized.

To prevent the role of the middle men in the milk business and to increase theirreturns.

To establish a bridge between rural and urban folk and to play a vital role in changinghe social and economic status of the rural folk.

3.5.5 Role of Diary Co-Operative Society

The dairy co operatives are organized in rural areas for the milk producers keeping in

view the domestic principles and values. These societies educate, guide, and support the milk

producers in dairy development activities.

3.5.6 Functioning of Diary Co-Operatives

The dairy co operative function all through the year in two shifts, this will provide

continuous market for the surplus milk produced and the payment for the milk supplied will

be distributed to the producers on the predetermined day. Input activities include:

Veterinary services like regular vaccination


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Artificial insemination services

Supply of balanced cattle feed and fodder slips

Training facilities

3.5.7 Growth of the Union

The milk union which was established in the year 1977 with 100 functional dairy co

operatives collecting 10,300 Kgs of milk per day is procuring on an average 386462 Kgs per

day from 1122 co operatives as on date with the increase in milk production the Hassan dairy

with the initial capacity of 60,000 KGPD was expanded to 120000 KGPD during 1996.The

union has also established three chilling centers with a chilling capacity of 20,000 KPD and

100000 KPD.

3.5.8 Activities of Hassan Milk Union

1. Organization of dairy co operative societies: As at the end of March 2010, 1197

societies have been registered. Out of functional societies, 330 women societies are

functioning.

2. Membership Enrolment: As on 31st March 2010 173396 members have been

enrolled of which 71046 are small farmer48866 are marginal farmers, 22199 are agriculturelabourers and 31285 are other big farmers.

3. Milk procurement activities: The present average milk procurement from 1122 milk

societies is 386462 Kgs/day.

3.5.9 Product Profile

Milk is marketed under Nandini brand name in different types. The pricing adopted is

mainly on four categories namely: Double Toned Milk Rs 14 /1000ml Toned MilkRs 16 /1000ml

Standardized (homogenized) Milk Rs 18 /1000ml

Full Cream Milk Rs 20 /1000ml

Apart from this, milk is marketed in 3 variants-

Nandini Goodlife with 3.5% fat and 8.5% SNF

Nandini Smart with 1.5% fat and 9% SNF

Nandini Goodlife Slim with 0.5% fat and 9% SNF


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Types of milk and milk products marketing by HAMUL

Nandini Toned Milk

Karnatakas most favourite milk, Nandini Toned Milk is a Fresh and pure milk

containing 3.0% fat and 8.5% SNF. Available in 500ml and 1 litter packs. Better to use

within a day from the date of pack. Maximum Retail Price is Rs. 13/- per litre.

Nandini Homogenized Toned Milk

Nandini Homogenized Milk is pure milk containing 3% Fat and 8.5% SNF. This is

homogenized and pasteurized. Consistent right through, it gives you more cups of tea or

coffee and is easily digestible. Available in 500 ml packets.

Nandini Full Cream Milk


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Nandini Full Cream Milk, Contains 6% Fat and 9% SNF. A rich, creamier and tastier

milk, ideal for preparing home-made sweets and savouries- available in 500ml and 1 litre

packs. MRP Rs. 15/- per litre

Good life

Cow's pure milk, UHT processed bacteria free in a tamper-proof tetra-fino pack which

keeps this milk fresh for 60 days without refrigeration until opened. Available in 500 ml Fino

and in 200ml bricks at premium stores across the state.

Smart

Cow's pure milk, homogenized, double toned UHT processed milk bacteria free in a

tamper proof tetra fino pack which keep the milk fresh for 60days without refrigeration until

opened. At present the milk is being directly home delivered on request? Available in 500ml

Pack.

Slim

Cow's pure milk, homogenized, Skimmed. UHT processed milk bacteria free in a

tamper proof tetra-fino pack which keep the milk fresh for 60 days without refrigeration until


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opened. Nandini Goodlife slim skimmed milk is 99.5% fat free. Available in 500ml Fino and

in200ml bricks at premium stores across the state.

Shubham

Buffalo's milk, 100% pure pasteurized processed and packed hygienically. This milk

has 5% fat and 9% SNF. Available in 500ml and litre, packs.

Mysore pak

Fresh and tasty, Nandini Mysore Pak is made from quality Bengal Gram, Nandini

Ghee and Sugar. It's a delicious way to relish a sweet moment. Available in 250gms.PP

container shrink packed to preserve freshness. Can be kept for 7 days. Advised to consume

fresh to enjoy its excellent taste.

Nandini Curd

Nandini Curd made from pure milk. Its thick and delicious giving you all the

goodness of homemade curds. Available in 200 grams and 500 grams packs. Nandini butter is

rich smooth and delicious.


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Nandini Ghee

A taste of purity, Nandini Ghee made from pure butter. It is fresh and pure with a

delicious flavour. Hygienically manufactured and packed in a special pack to retain the

goodness of pure ghee, having Shelf life of 6 months at ambient temperatures. Available in

200ml, 500ml, 1000ml, and sachets and also in 5lts tins and 15.0 kg tins.

Nandini Butter

Nandini spiced buttermilk is a refreshing health drink. It is made from quality curds

and is blended with fresh green chillies, green coriander leaves, asafoetida and fresh ginger.

Nandini spiced butter promotes health and easy digestion. It is available in 200ml packs and

is priced at most competitive rates, so that it is affordable to all sections of people.

Nandini Butter Milk

Nandini butter milk is Rich, smooth and delicious. Available in 100 grams (salted),

200 grams and 500 grams cartons both salted and unsalted.


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Cheese

Delicious Cheese, processed with utmost care to ensure the smooth and rich taste of

pure cheese. It's highly nutritious an excellent source of milk proteins and a rich source of

calcium. Need to be kept under refrigeration. Available in 100gms carton

Paneer

Pure and tasty dishes with Nandini Paneer! A fresh, nutritive product made by

coagulating pure milk, it is an excellent source of milk protein. Nandini Paneer is ideal forvegetarian dishes such as mutter Paneer, sag Paneer and various other dishes. Refrigerated

storage in preferable. Available in 200gms pack, specially packed in a five layer film and

vacuum packed to preserve its quality. Bulk packings are also available.

Flavoured milk

Sterilized flavoured milk, a nutritious and healthy drink and an all-season wholesome

drink available in five different flavours - pineapple, rose, badam, pista and natural orange.

Apart from refreshing energy. Available in 200ml.


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Nandini Peda

No matter what you are celebrating! Made from pure milk, Nandini Peda is a

delicious treat for the family. It is maintained at room temperature, for approximately 7 days.

Available in 250grams pack containing 10 pieces each.

3.5.10 Production DepartmentEvery morning by 9.30am, the scheduled is drawn depending on the consolidation of

all the information from different units. Entire milk has to dispatched before the next raw

milk comes in. All the availability options should be weighed and instant decisions have to be

taken. Presently the day to procurement on an average comes up to 2,50,000 litres per day.

All the indents are moved there by 11am and this has to be intimated to the packing division.

Packing material purchase is based on the integrated business plan. The rolls have to

be weighed and bought out because by the end of the month the statement has to be prepared

if the loss is 2% over and above the loss is recovered from the suppliers. If the loss is >1%

and


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3.5.11 Marketing Department

Marketing should be considered as the core business function in this competitive

world as it establishes, develops, and commercializes long term customer relationships and

helps in meeting organizational goals.

Pricing is a federal policy and KMF decides the marketing price of the milk end the

milk products. KMF has adopted pricing mainly on four categories namely

Double Toned Milk Rs 14/100ml

Toned Milk Rs 16/1000ml

Standardized (homogenized) Milk Rs 18/1000ml

Full Cream Milk Rs 20/1000ml

As Hassan Milk Union is procuring 4 Lakh milk per day and its local market requirement is

1.2 Lakh Kgs/day. As such the excess milk is being sent to sister unions and Interstate

federations and balance if any will be sent for conversion into butter and SNP. 3

3.5.12 Procurement Department

The milk co operative societies will be organized in villages where there is excess

milk production. The extension staff of the union will visit the villages and conducts the

survey about the village population, animal population and the availability of the surplus milk

and report to the office for consideration. The office will issue necessary instructions to

organize the societies.

Then the first Gramasabha meeting will be conducted and select the promoters to

promote the Dairy cooperative in the village and with the permission of Registrar of

Cooperative with the recommendation of Milk union the Village Chief promoter will

permitted to collect the share capital and with all fulfilment of required norms then proposal

will be sent to registrar of co operative department for registration. On registration, milk co

operative society will be commissioned and starts procuring milk from the producers. The

milk procured will be transported through trucks to nearby chilling centers and dairy where

milk is processed further. The society will be provided with veterinary services, AH services,

feed and fader services, and training and extension services.

The village dairy Cooperatives will receives payments for the milk supplied to Union

once in a week and the same will be distributed among its produce members every week and

day is fixed which is convenient to the concerned village.


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3.5.13 Stores/ Purchase Department

Purchase Purchase/stores Officer Sub staff Hassan Milk Union is having a separate

purchase department and purchases are made based on the requirements of various

department and purchases are made as per the relation laid out.

Hassan Milk Union is having full pledged stores which supplies materials to various

based on the indents or requirements and the people who are working in the stores are very

well worked in inventory management. Both purchase and store departments are working

under the supervision of manager dairy.

Stores:

The storage place for almost all necessary goods which come into the factory premises: But

here the store is the place where all these are there:

1. Packing materials

2. Stationery

3. Spares

4. Oil and lubricants

5. Sugar

6. Testing chemicals

7. Cleaning acids

8. Uniforms and Shoes

9. Cans for societies

10. Ledgers

The activity takes place in stores:


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Requisition letter: First the manager of concerned department depending upon the need for

the goods sends a requisition letter to the manager dairy and then once approved the same

reaches the stores in charge; the purchase section places an order.

Purchase order: But for the goods regular nature depending upon the stock level, the stores in

charge takes up the responsibility to place order and have the materials ready when ever

required. Here in the co operative sector as per the transparency act if the goods and where

the capital expenditure is involved, the enquire letters are sent the suppliers and who ever

quotes the least and also with quality gets the order.

And the same purchase order copy goes to

1. The supplier

2. The store in charge

3. Accounts section

4. Concerned user section

Purchase order also includes

1. Mode of payment after and before supply

2. Terms and conditions (taxes)

3. Delivery period

4. Mode of dispatch

Invoice

Against the purchase order the concerned supplier gives the invoice. Once the invoice

is received the cross checking of materials as per the specifications purchase order is done.

The concerned department communicated about the goods and the concerned person gives a

user section remark on the quality of the product. Hence the goods received note is sent to

concerned user section.


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3.5.15 Production Department:

The dairy works in 3 shifts to receive milk in the morning and evening shifts. The

milk received from DCS in cans will be tested for quality and weight is recorded. The

payment will be made based on the quality and the quantity. The milk received in tankers willbe weighed and tested and pumped into chillers and stored in insulator storage tank. The local

market needed quantity will be pasteurized and stored in insulated HMST for packing toned

milk, double toned milk and standardized homogenized milk. Apart from this, union also

produces ghee, Peda, flavoured milk, curds and butter milk.

The excess fat in the milk will be separated in the form of cream and issued for butter

making. The cream breaks into butter and butter milk where butter is issued for ghee making

and butter milk is tested for fat/COB (clout on boiling) and it will be reprocessed or will be

drained out. Based on the market demand, butter is drawn for ghee production and sale will

be packed as per requirement.

3.5.16 Achievements

Hassan milk union is procuring milk from all the 13 taluks of three districts andselling quality milk in all the taluks and small towns.

The union and all the dairy co operatives are being managed by the democraticallyelected boards from among the milk producers.

The technical input to dairy co operatives and the dairy plants are managed by welltrained, committed professionals and technical team.

91% of the milk co operative societies are operating under profit The union has successfully implemented the animal induction program for SC ST and

OBC since 1996 with the financial assistance from central and state governments and

rendered direct loans to the beneficiaries at lower interest rates.

254 women dairy co operatives (as on May 2009) have been organized since 1997under support training and education program(STEP)

The union has also implemented mini dairy scheme and bring entrepreneurialenvironment in the rural area.

The union has set up Artificial insemination facilities for dairy co operatives. The union has rendered emergency veterinary services round the clock. The union has implemented foot and mouth disease control program(FMDCP)


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Fertility camps are being conducted once in three months by inviting experts in thefield.

The union supplies quality fodder slips and seeds through the year and facilitates theavailability of green fodder.

The union is insuring the life of milk producers and dairy co operative staff with theco ordination from Life Insurance Corporation and National insurance company since

1997-1998 under samajika suraksha yojana.

The union has launched the YESHASHVINI program to the milk producerswherein the milk producers are provided with the best available medical facility at

free of cost.

Smokeless chula have been provided to the milk producers with an intention ofimproving the health of rural women folk.

The union has successfully implemented the Total energy management program andTotal quality management program (quality excellence from cow to consumer) since

2001 respectively.

Quality awareness programs are being conducted regularly for school children, housewives and consumers.

The union has got ISO 9001:2000 certification from TUV India, Mumbai. The unionhas got Energy Conservation Award

3.5.19 SWOT Analysis

Strengths

Procurement and Input( P&I) network

Goodwill

ISO 9001:2000 certified

Second largest producer

Vast market

Weaknesses

WTO standards

Advertisement execution in its early

Early stages of automation and computerization


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Opportunities

Enter rural market

Neutraceuticals

Exports

Threats

Entry of big players

WTO standards

Government policies


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4.1 Budget 2008-09 of the Union

The first objective of this study is to analyze the budget of the organization. The

budget of the organization is prepared by a budget committee with consultation with the

various departments. The budget is prepared on the basis of the estimations given by eachdepartment and the same is consolidated into a yearly budget by taking into consideration the

various sources of income and expenditure.

For the purpose of analysis, the budget of 2008-09 of Hassan Milk Union is

considered wherein the current year figures are compared with the actual of the year to obtain

the variations thereof.

4.2 Budget Process at Hassan Milk UnionThe budget prepared by any organization is an estimate of the various sources through which

revenue would be generated and the various expenditures which would be incurred during the

year. Excess of income over expenditure would result in net profit and excess of expenditure

over income results in net loss during the year. At Hassan Milk Union, the budget is prepared

by the accounts department with consultation from various other departments.

Estimation of Procurement of Milk from Various Societies

The budget of Hassan Milk Union mainly depends on the procurement of milk from its

various societies. Thus the estimation of the same plays a vital role in the budget process. The

accounts department obtains estimation on the quantity of procurement from the MIS

department based on the past experience and the trend. Procurement of milk depends on the

seasonal fluctuations. In the milk industry, a period from October to January is considered as

a flesh period during which there is abnormal procurement i.e. over and above the normal

procurement. A period of 3 months from March to June is considered as lean period during

which the quantity of milk obtained is less. The remaining months in the year generate

normal procurement. Also in the milk industry, once in 3 years is considered as lean period

wherein the procurement of milk reduces in all the diaries throughout the country. However,

there has been a change in the trend recently wherein in November the procurement is normal

and May to August is a period when the procurement is abnormal and January to April has

turned out to be lean period. Based on these trends, the MIS department estimates the

procurement and that is the basis on which the yearly budget is based.


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Marketing Plan is Set Out

The Marketing department of Hassan Milk Union lays down its marketing plan which gives

an estimate of the local sales of milk and various milk products. H.R.I.H.E, Hassan Page 54

55. A Study on Budgetary Control System Based on this plan, an estimate is made on the

milk which is to be sent to other diaries and what quantity of milk is to be sent for

conversion. Based on this, the transportation costs and conversion costs are estimated.

Target is Laid down by Different Departments

Each department of the Union lays down its own targets for which has finance to be provided

for by the accounts department in its budget. All this has to be incorporated for in the yearly

budget.

Costs are estimated

Based the plans of various departments, the total expenditure and revenue are penned down

in a prescribed manner which would estimate the net profit/ loss for the year.

4.3 Analysis of Budget

Here each item of the budget is calculated as a % of sales and analyzed. The yearly

figures are considered for these calculations.


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The table above shows the projected annual figures of the on various items for year

2008-09. It also shows the various incomes and expenditure as a % to sales. As per the

budget, the Hassan Milk Union is expecting a net profit of Rs 31, 32,000 for the year with a

net profit ratio of 0.19%. The major source of revenue is from sales of milk and milk

products in local markets and inter-diaries. There are certain other sources of income as well

like interest on deposits and other income. However, they contribute to only 0.15% and

0.37% respectively which indicates it is a minor source of revenue to them. The major

expense projected is purchase of milk and milk products which is about 86.35% of sales.

Hassan Milk Union procures milk from various societies at different rates. It is the basic raw

material required for processing into Skimmed Milk Pouches and for conversion to various

milk products like ghee, butter, Peda, buttermilk etc,

The graph depicts the budget in a diagrammatic manner. The graph shows that the

main items in the budget are sales and purchases. All the remaining items are very minor and

are thus hardly pointed on the graph.

4.4 Comparing the Actual with the Budgeted Figures and Computing the

Variances.

The table on the next page shows the annual budgeted figures and the actual figures

which is obtained from the audited reports of the union. The following 2 formulas have been

used to calculate the variances and the % of variances.

Calculation of Variance and % of Variance

Variances = Actual yearly totalBudgeted yearly total

% of variances = variance amount X 100

Budgeted yearly total


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The graph shows that the estimate of sales and purchase is very less compared to the

budgeted amount. The same can be shown using a pie-chart which shows the variances in the

various particulars.

4.5 ANALYSIS OF VARIOUS ITEMS ESTIMATED IN THE BUDGET

Opening Stock


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INTERPRETATION

The chart above shows the budgeted and actual results with regard to stock of milk and

various milk products at the beginning of the year. The budgeted figures were Rs 50.45 Lakh

and the actual expenditure incurred was Rs 155.14 Lakh. Thus, there is a variance of Rs

104.69 Lakh. The stock at the beginning of the year depends on the closing stock at the end

of previous year. The closing stock at the end of 2007-08 was Rs 155.14 Lakh which,

therefore, became the opening stock of the year 2008-09.

Purchase and Material Consumption

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the purchases

and material consumption. The budgeted figures were Rs 14167.26 Lakh and the actual

expenditure incurred was Rs 18810.83 Lakh. Thus, the variance is Rs 4643.57 lakhs which is

highly inconsistent.


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This variance is mainly due to high purchase of milk and milk products made during

the year. The Union accepts the entire quantity of milk which it procures from the various

societies at different rates depending on the profitability of the Union, and the purchases vary

substantially from the budgeted amount every year.

Procurement and Transport Expenses

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the procurement

transportation cost. The budgeted figures were Rs 372.97 lakhs and the actual expenditure

incurred was Rs 637.48 lakhs. Thus, the variance of Rs 264.51 lakhs is an adverse variance.

This variance is due to the addition of various routes from which the diary procures

milk. The number of societies from which milk is obtained as increased and an increase in

number of sources would obviously increase the transportation cost of procuring the raw

milk.


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Processing and Manufacturing Expenses

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the process

manufacturing expenses. The budgeted figures were Rs 438.54 lakhs and the actual

expenditure incurred was Rs 931.05 lakhs. Thus, the variance is Rs 492.51 lakhs which isquite high.

The deviation in the process manufacturing expenses is mainly due to the variation in

the conversion cost which shows a difference of Rs 174.68 lakhs. The conversion cost mainly

depends on the milk procured by Hassan Milk Producers Union Society. Whenever the mil k

procured is in excess, there would be no market for milk. In such case, excess milk is sent to

inter-diary and then after its sent for conversion to butter, SMP. As we have seen that the

procurement of milk was very high during the year, the conversion cost has also varied

considerably which in turn is the main cause for the process manufacturing process to

deviate.

Sales


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INTERPRETATION

The chart above shows the budgeted and actual results with regard to the sales

generated during the year. The budgeted figures were Rs 16405.07 lakhs and the actual

expenditure incurred was Rs 21852.33 lakhs. Thus, the variance of Rs 5447.26 lakhs is highly

a favourable variance.

Sales are the main source of revenue for any organisation. Thus, the higher sales it is

the better for the organisation. The higher variance in it has a positive impact. However it

becomes necessary to analyse the causes for it.

The deviation in sales is mainly on account of sales to inter dairies and other states

which have varied considerably. This is again due to high procurement during the year. The

excess of milk has been sold to various other diaries which have been a major source of

income. Also ghee has a very good demand in the local market near Hassan due to which the

sales of loose and sachet ghee is much more than anticipated.

Closing Stock

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the closing stock

at the end of the year. The budgeted figures were Rs 70.56 lakhs and the actual amount has

increased by Rs 248.09 lakhs. Thus, the actual closing stock at the end of the financial year

2008-09 was Rs 318.65 lakhs.

Closing stock depends on the sales generated, production during the year and also the

opening stock.


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Opening Stock + Production = Sales + Closing Stock

Closing Stock = Opening Stock + Production - Sales

As there is a variance in the opening stock, purchase and production and also in the

sales made during the year, the closing stock is bound to show variations from the anticipated

figures. The closing stock of this year becomes the actual opening stock for next year.

Staff Expenses

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the staff

expenses incurred during the year. The budgeted figures were Rs 986.77 lakhs and the actual

expenses were Rs 997.8 lakhs. Thereby, there is an adverse variance of Rs 11.03 lakhs.

The various expenses under this head show minor deviations from the budgeted

figures. The major variance was in Leave Encashment Insurance Premium paid during the

year. The deviation was due to the additional premium paid by the union during the year. The

amount received at the time of maturity is used to pay the employees at the time of their

retirement for the leave not availed by them during their service in the union.


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Administrative Expenses

INTERPRETATION The chart above shows the budgeted and actual results with regard to

the office and administrative expenses incurred during the year. The budgeted figures were

Rs 134.06 lakhs and the actual expenditure incurred was Rs 99.06 lakhs. Thus, the actual

expenditure is less than the budgeted amount by Rs 35 lakhs thereby making it a favourable

variance in total.

Selling and Distribution Expenses

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the selling and

distribution expenses. The budgeted figures were Rs 289.33 lakhs and the actual amount is Rs

358.74 lakhs. Thus, there is an adverse variance of Rs 69.41 lakhs. The major deviation was

in the tanker charges incurred in the selling and distribution expenses for the year. The tanker

charges had been much more than budgeted because the sale of milk and milk products to the


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various inter diaries have increased. With the increase in the sales, the cost to transport the

products also increased.

Interest and Bank Charges

INTERPRETATION The column chart above shows the budgeted and actual results with

regard to the expenses on interest and bank charges. The budgeted figures were Rs 18.25

lakhs whereas the actual amount incurred during the year is Rs 15.58 lakhs. Thus, there is a

favourable variance of Rs 2.67 lakhs due to the reduction in expense and thereby increasing

profit in total. The Union proposed to borrow loan from the bank at the beginning of the

financial year and thus interest calculations were done for the entire 12 months of the year.

However, the loan was borrowed mid-year and thus, the amount of interest paid was less than

the budgeted figure. This caused a favourable variance in this head.


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Depreciation

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the depreciation

charged on the fixed assets during the year. The budgeted figures were Rs 60 lakhs and the

actual expenditure incurred was Rs 133.30 lakhs. Thus, the variance is Rs 73.30 lakhs which

is quite high.

At the time of preparing the budget, Hassan Milk Union followed the Straight Line

Method of depreciation and thus expected the monthly depreciation to be Rs 5 lakhs which

amounts to Rs 60 lakhs per annum. However, during 2008-09, the union changed its method

of depreciation to Written down Value Method due to which the non-cash expense has been

much more than expected. The additions in the fixed assets have also lead to an increase in

the amount of depreciation.


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Other Income

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the income

generated from other sources. The budgeted figures were Rs 61.48 lakhs and the actual

amount has increased by Rs 6.24 lakhs. Thus, the total income from other sources was Rs

67.72 lakhs in total.

Interest on Deposit and Advances


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INTERPRETATION

The chart above shows the budgeted and actual results with regard to the income generated

from interest on deposits and advances during the year. The budgeted figures were Rs 24.18

lakhs and the actual amount was less by Rs 3.83 lakhs which was due to early withdrawal of

deposits from the bank.

Net Profit/Loss

INTERPRETATION

The chart above shows the budgeted and actual results with regard to the net profit

earned during the year. The budgeted figures were Rs 31.32 lakhs and the actual profit

incurred was Rs 117 lakhs. Thus, the variance is Rs 85.68 lakhs which is a highly positive

impact.

An organisation should try to maximise its various sources of revenue and at the same

time it should minimise its expenses and various costs. Excess of income over expenditure

indicates profit. And excess of expenditure over income results in loss.

At Hassan Co-Operative Milk Producers Societies Union, they have enhanced their

sales by Rs 3040.82 lakhs as against the budgeted figure. This has been the main reason for

the net profit to be much more than the amount anticipated. However, a deviation in the

various expenses has reduced the net profit as against the additional sales generated.


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5. Findings

After carrying out a detailed study on the budgetary control at Hassan Co- Operative

Milk Producers Societies Union, Hassan, the following observations were made:

Hassan Co-Operative Milk Producers Societies Union prepares a financialbudget every year. However, a study on the budget of year 2008-09 shows

high inconsistency. Certain expenditures and incomes show major variations.

The union follows a budgetary control system. However, it is not followedstrictly.

Budgetary control system is strictly followed in case of items which are capitalin nature. In case of revenue expenses, the organisation tries to stick to its

budgetary limits. However, only in rare cases, the budgeted figures match withthe actual figures for the year.

Every year, after the audit of the annual reports, the accounts departmentprepares a report on the major variances and excess expenditure incurred

during the year. The same is presented in the Annual General Body meeting

for ratification for the excess of expenditure.

There are certain items of revenue and expenditure which were not takenincluded in the budget, but however, they were incurred in actual. Due to this,

the profit as per the budget format does not match with the actual profits

shown in the Profit and Loss Account. The variation is due to omission in the

inclusion of these items in the budget. This includes provision for tax,

provision for bad and doubtful debts, dividend and bonus from KMF.


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Suggestions

After conducting a detailed study on the budgetary control system of the Union, it is

evident that the budgeted amount and actual amount for the year vary substantially. However,

in my view, the following points would ensure a better budgetary control system at HassanMilk Union.

The union should prepare the financial budget considering all items of probableexpenses. Non-estimation of any expense in the budget may put financial constraints

in the working of union as a budget helps to work out the financial plan for the year. \

The budget should be prepared in such a way that the deviations in the expenses arereduced to minimal. The higher the inconsistency in the budget, the higher the

fluctuations in the financial position of the Union. The Union has changed the method of depreciation during the financial year. There

should be a consistency in the method of depreciation as adopted at the time of

preparation of budget and in real practice. Any change in it can put financial burden

on the Union.

The Hassan Milk Union should follow a strict procedure on the budgetary controltechnique which would ensure a proper control on the funds of the Union.

The Union should involve all the other departments in the preparation of budget. Itwould bridge the gap between the budgeted figures and the actual figures for the year.


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Conclusion

Budgetary control is an important tool for the management to have an effective check

on its working as well as the staff. However, it is seen as a time consuming technique by

various organisations and thus do not pay much attention to it.This study examined the relationship between budget and performance of the

financial year 2008-09 of Hassan Milk Union. The previous literature and contributions to

this study and the problems associated with budgetary control have been reviewed. Through

this study it was found that the budget shows high inconsistency and the actual performance

varies considerably from the budgeted figures.

Following the findings, it is hereby advised that all the managers and business

operators to pay more attention to their budgetary control systems, while those without any

should endeavour to ensure the set-up of a result-oriented system as it goes a long way in

repositioning businesses and organizations from their creeping performance level to an

improved and high capacity utilization point.


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Bibliography

1. S.N.Maheshwari and S.K. Maheshwari, Accounting for Management, First Edition,

Vikas Publication House Pvt Ltd, Pg no4.3- 4.72. Jawahar Lal, Cost Accounting, Third Edition, Tata McGraw-Hill Publishing Company

Limited, Pg no- 775-784 and 798-807

3. I.M.Pandey, FinancialManagement, Ninth Edition, Vikas Publication House Pvt Ltd, Pg

no754-758 4.

Cos Accounting(Final)

Documents

Transcript of Cos Accounting(Final)