Table Of Contains

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01. LATTER OF TRANSMITTEL I

02. Acknowledgement II

03. Executive Summary III

04. Table Of Contains 1

05. Company Profile 2

06. History of the Organization 2

07. Does the company’s annual report information possess “Relevance”?

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08. Does the company’s annual report information possess “Reliability”?

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09. Does the company’s annual report information possess “Comparability?

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10. Does the company’s annual report information possess “Consistency”?

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11. Recommendation 7

12. CONCLUSION 8

13. REFERENCE IV

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Chapter One: Introduction

Company Profile

Square Pharmaceuticals Limited Bangladesh is the largest pharmaceutical company in Bangladesh and it has been continuously in the 1st position among all national and multinational companies since 1985. It was established in 1958 and converted into a public limited company in 1991. The sales turnover of SPL was more than Taka 11.46 Billion (US$ 163.71 million) with about 16.43% market share (April 2011– March 2012) having a growth rate of about 16.72%.

Vision - We view business as a means to the material and social wellbeing of the investors, employees and the society at large, leading to accretion of wealth through financial and moral gains as a part of the process of the human civilization.

Mission -Our Mission is to produce and provide quality & innovative healthcare relief for people, maintain stringently ethical standard in business operation also ensuring benefit to the shareholders, stakeholders and the society at large.

Objective- Our objectives are to conduct transparent business operation based on market mechanism within the legal & social frame work with aims to attain the mission reflected by our vision.

History of the Organization:

Square today symbolizes a name – a state of mind. But its journey to the growth and

prosperity has been no bed of roses. From the inception in 1958, it has today burgeoned

into one of the top line conglomerates in Bangladesh. Square Pharmaceuticals Ltd., the

flagship company, is holding the strong leadership position in the pharmaceutical industry

of Bangladesh since 1985 and is now on its way to becoming a high performance global

player. Square Pharmaceuticals Limited is the largest pharmaceutical company in

Bangladesh and it has been continuously in the 1st position among all national and

multinational companies since 1985. It was established in 1958 and converted into a

public limited company in 1991. The sales turnover of SPL was more than Taka 5 Billion

(US$ 90 million) with about 15% market share (April 2003 – March 2004) having a

growth rate of about 16%.

1958: Debut of Square Pharmaceuticals Limited as a partnership firm.

1964: Converted into a Private Limited Company.

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1974: Technical Collaboration with Janssen Pharmaceutical, Belgium, a subsidiary of

Johnson and Johnson International, USA.

1982: Licensing Agreement signed with F. Hoffmann-La Roche Ltd., Switzerland.

1985: Achieved first position in the Pharmaceutical Market of Bangladesh among all

national and multinational companies.

1987: Pioneer in pharmaceutical export from Bangladesh.

1991: Converted in to a Public Limited Company

1994: Initial Public Offering of Square Pharmaceutical Shares.

1995: Chemical Division of Square Pharmaceuticals Ltd. starts production of

pharmaceutical bulk products (API).

1997: Won the National Export trophy for exporting pharmaceuticals.

1998: Agro-chemicals & Veterinary Products Division of Square Pharmaceuticals Limited

starts its operation.

2001: US FDA/UK MCA standard new Pharmaceutical factory goes into operation built

under the supervision of Bovis Lend Lease, UK.

2004: Signing of agreement with ROVIPHARM, Vietnam to manufacture and market

SQUARE products under license in Vietnam.Secured the top position for the best

published accounts and report for 2003 in the manufacturing category for transparency and

excellence in corporate reporting.

2010: New State-of- the-Art Square Cephlosporins Ltd. goes into operation; built under

the supervision of TELSTAR S.A. of Spain as per US FDA/ UK MHRA requirements.

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Chapter Two: Analysis of annual report

1. Does the company’s annual report information possess “Relevance”?

To be relevant, accounting information must be capable of making a difference in a decision. If certain information has no bearing on a decision, it is irrelevant to that decision. Relevant information helps users make predictions about the ultimate outcome of past, present, and future events; that is, it has predictive value. Relevant information also helps users confirm or correct prior expectations; it has feedback value. For example, when UPS (United Parcel Service) issues an interim report, this information is considered relevant because it provides a basis for forecasting annual earnings and provides feedback on past performance. For information to be relevant, it must also be available to decision makers before it loses its capacity to influence their decisions. Thus timeliness is a primary ingredient. If UPS did not report its interim results until six months after the end of the period, the information would be much less useful for decision making purposes. For information to be relevant it should have predictive or feedback value and it must be presented on a timely basis

Form the analysis of previous annual report of square pharmaceutical ltd I find that the information provided are relevant for the user of information. Because it’s information has

a) Timeliness: the information provided for a specific period of time the time period is for one year, ever year it published its annual report for its stock holders.

b) Predictive value: the company has a detailed plane for itself about it future and prediction about future growth which we find form management discussion and analysis part.

c) Feedback value: form the final account and foot note we can find the feedback of previous prediction that match with the perceived value. For this reasons we can say the information is Relevance.

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2. Does the company’s annual report information possess “Reliability”?

Accounting information is reliable to the extent that it is verifiable, is a faithful representation, and is reasonably free of error and bias. Reliability is a necessity for individuals who have neither the time nor the expertise to evaluate the factual content of the information. Verifiability is demonstrated when independent measurers, using the same measurement methods, obtain similar results. For example, would several independent auditors come to the same conclusion about a set of financial statements? If outside parties using the same measurement methods arrive at different conclusions, then the statements are not verifiable. Auditors could not render an opinion on such statements. Representational faithfulness means that the numbers and descriptions represent what really existed or happened. The accounting numbers and descriptions agree with the resources or events that these numbers and descriptions purport to represent. If General Motors’ income statement reports sales of $150 billion when it had sales of $138.2 billion, then the statement is not a faithful representation. Neutrality means that information cannot be selected to favor one set of interested parties over another. Factual, truthful, unbiased information must be the overriding consideration. For example, R. J. Reynolds should not be permitted to suppress information in the notes to its financial statements about the numerous lawsuits that have been filed against it because of tobacco-related health concerns even though such disclosure is damaging to the company. Neutrality in standard setting has come under increasing attack. Some argue that standards should not be issued if they cause undesirable economic effects on an industry or company. We disagree. Standards must be free from bias or we will no longer have credible financial statements. Without credible financial statements, individuals will no longer use this information. An analogy demonstrates the point: In the United\ States, we have both boxing and wrestling matches. Many individuals bet on boxing matches because such contests are assumed not to be fixed. But nobody bets on wrestling matches. Why? Because the public assumes that wrestling matches are rigged. If financial information is biased, the public will lose confidence and no longer use this information.

Form the analysis of previous annual report of square pharmaceutical ltd I find that the information provided are relevant for the user of information. Because it’s information has

a. Representational Faithfulness: the information provided is faithful enough that so auditor authorized the financial statement as Standard unqualified report, on the other hand by analyzing previous history I find that by using the information no one suffer from losses

b. Verifiability: the information provided in the statement is verifiable, by using the same method any one can verify the information

c. Neutrality: the information is not bias it is neutral for all.

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3. Does the company’s annual report information possess “Comparability?

Comparability is one of the key qualities which accounting information must possess.

Accounting information is comparable when accounting standards and policies are

applied consistently from one period to another and from one region to another. The

characteristic of comparability of financial is important because it allows us to compare

a set of financial statements with those of prior periods and those of other companies.

The information of square pharmaceutical is comparable with other years performance

as well as with other company.

4. Does the company’s annual report information possess “Consistency”?

The concept of consistency means that accounting methods once adopted must be

applied consistently in future. Also same methods and techniques must be used for

similar situations. It implies that a business must refrain from changing its accounting

policy unless on reasonable grounds. If for any valid reasons the accounting policy is

changed, a business must disclose the nature of change, the reasons for the change and

its effects on the items of financial statements. Consistency concept is important

because of the need for comparability, that is, it enables investors and other users

of financial statements to easily and correctly compare the financial statements of a

company.

The organization follows the same accounting method over the year to year calculation

of its asset, liability and owners’ equity so we can call square pharmaceutical as a

consistent company.

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Recommendation

1. Quality and control: According to international standard square pharmaceuticals ltd. should maintain their product quality.

2. Local market share: At present in Bangladesh square pharmaceuticals is the market leader in pharmaceutical sector. Its followers and competitors always try to increase their percentage of market share. So square pharma concentrate more to increase his market share.

3. Dynamic sales strategies: Due to the customer complaint and the lack of guidelines to prevent untrained sales staff from serving customers, we recommended that square pharma should take dynamic sales strategies for higher customer satisfaction.

4. Foreign market: Though SPL captured Asia, Africa, Middle East pharmaceutical market but the Europe market till now un-captured. So square pharma should concentrate more in Europe market.

5. Compensation: In the light of the employee's complaint, square pharmaceuticals should take proper compensation policy.

6. Staff training: Though SPL is a leading company but its maximum staffs are not well trained. So company should arrange training program.

7. Monitoring new staff: To get better performance the authority of the company should monitor their new staffs carefully.

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CONCLUSION:

From the total analysis, I can summarize that Square Pharmaceuticals Ltd. has been

doing pretty good throughout the years. It is true that last year their return did decline

but it is still pretty much satisfactory. Therefore, we can conclude that Square

Pharmaceuticals Ltd. is a good enough company to invest on. The other

Pharmaceuticals Ltd. financial analysis indicates that it has been also doing pretty good

throughout the years but not as well as the Square Pharmaceuticals Ltd.

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