8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 1/101
1ARYANS SCHOOL OF MANAGEMENT
SUMMER TRAINING PROJECT REPORT
ONFINANCIAL ANALYSIS
OF
MANKAPUR, GONDA (UP)
SUBMITTED TO: SUBMITTED BY:
ARYANS SCHOOL OF MANAGEMENT RUPESH KAPASIA
Nepra,Chandigarh MBA 3rd
SEMESTER
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 2/101
2ARYANS SCHOOL OF MANAGEMENT
PREFACE
Summer training plays a vital role in understanding working culture and
climate of industry. This training has been misinterpreted by most of us a
platform for performing only projects. Industrial training in the true sense has
been included in the curriculum to make the students well versed with the
technical procedures, management and its practical approaches, which is very
different from theoretical aspects.
The educational institutions role aim by industrial training is to improve the
knowledge about the organization and to have a hand -on experience. Theterms and procedures which we learn are of no use until and unless we do
bring them in practical operation and start dealing with them in real life. For
becoming a good professional it is very much required that whatever the
knowledge and skills one has adopted during this training has to increase with
this knowledge and day-to-day experience from his own life.
Last but not the least this training is very much important in shaping ones
bright future and career as it provides all basic information a new professional
wants before completion of his training.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 3/101
3ARYANS SCHOOL OF MANAGEMENT
ACKNOWLEDGEMENT
A prestigious organization for providing me an opportunity to undergo summer
training for project work as a part of my MBA
course.
It would be my privilege to express my sincere and deep sense of gratitude to
Mr. H.D. Gupta, (DFM-CF) for his able guidance, pain staking inspiration and
untiring supervision throughout the project work period.
I also wish I feel immense pleasure in expressing my gratitude to I.T.I. Limited
Mankapur, to express my sincere gratitude to Mr. G. K. Srivastava(FO-CS), Mr.
Rakesh Tiwari (AFO-PR), Mr R. K. Srivastava (AFO-Bank) and Mr. P. K. Agrawal.
I am highly thankful and indebted to Mr. S. S. Bisht (Manager -HRD) for theireffective, valuable and constant support for successful completion of the
training programme without which this project would not have seen t he light
of the day.
I am also thankful to I.T.I. Ltd. Employees who have been very supportive
either directly or indirectly and rendered their help during my stay at
Mankapur for the summer internship programme.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 4/101
4ARYANS SCHOOL OF MANAGEMENT
CERTIFICATE
This is to certify that Vaishnav Prasad Dwivedi who is pursuing his M.B.A III
sem inA
ryans School Of Management Chandigarh has undergone training inI.T.I. Limted Mankapur for a period of Two months from 2/6/10 to 30/7/10.
He had attended all the classes and visited all the financially centred areas of
the industry regularly.
I wish him all the success in life
MR. H. D. GUPTA
DY. FINANCE MANAGER
(CENTRAL FINANCE)
I.T.T. LIMITED MANKAPUR.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 5/101
5ARYANS SCHOOL OF MANAGEMENT
CONTENTS
PREFACE
ACKNOWLEDGEMENT
COMPANY PROFILE
y Board of Directors
y Manufacturing units
y Infrastructure
Mankapur Unit (UP)
Srinagar Unit (J&K)
Palakkad Unit (Kerela)
Raibareily Unit (UP)
Naini Unit (UP)
Bangalore Complex (Karnataka)
MISSION
OBJECTIVES
OBLIGATIONS
I T I CONTRIBUTIONS TO NATIONAL TELECOM INFRASTRUCTURE
AWARDS AND ACHIEVEMENTS
ABOUT THE MANKAPUR UNIT
y Main Division
y Product of ITI Mankapur
y Customer
y Research Methology
ERP USED IN I T I LIMITED
ISO
SIX SIGMA
FINANCIAL STATEMENTS
y Balance Sheet
y Profit & Loss Account
FINANCIAL STATEMENT ANALYSIS
y Horizontal Analysis
y Vertical Analysis
FINANCIAL ANALYSIS
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 6/101
6ARYANS SCHOOL OF MANAGEMENT
y Ratio Analysis
y Nature Of Ratio Analysis
y Standard of Comparison
y Utility of Ratio Analysis TYPES OF RATIOS
y Profitability Ratio
y Working Capital Ratio
y Growth Ratio
ACCOUNTING POLICIES
COMPARATIVE ANNUAL REPORT
OPERATING RESULTS
FINANCIAL POSITIONS PROFITABILITY RATIOS WORKING CAPITAL RATIOS
GROWTH RATIOS
WORKING CAPITAL STATEMENT
COMPARISION OF SALES AND WORKING CAPITAL
WORKING CAPITAL ANALYSIS
SALES ANALYSIS
PRODUCTABILITY OF CAPITAL
PRODUCTION ANALYSIS
COMPARISON OF SALES AGAINST PROFIT AFTER TAX
HOW MONEY WAS UTILISED
SWOT ANALYSIS
FACTS AND FINDINGS
RECOMMENDATIONS
BIBLIOGRAPHY
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 7/101
7ARYANS SCHOOL OF MANAGEMENT
COMPANY PROFILE
Industries Ltd, a department undertaking under the ministry of post and ITI
Ltd. is Indias first public sector enterprise established in 1948 as Indiantelegraph, it was envisaged as an indigenous manufacturing facility in the
beginning.
ITI limited has since emerged with its own corporate identity, as a leading
telecom company manufacturing the entire range of Telecom Company
manufacturing the entire range of telecom equipment which includes
telephones, large digital switches, transmission systems, digital microwave
fibre optics systems and satellite communications systems.
Vibrant R&D support striving for excellence in quality, cost effectiveness, in its
product & services with talented engineers and state of the art machinery.
A dedicated network system unit provides value added services such as shred
hub VSAT services and MRTS and turnkey solutions.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 8/101
8ARYANS SCHOOL OF MANAGEMENT
ShriK.L.DhingraChairman
and Managing Director
Shri K.L. Dhingra joined ITI asChairman and Managing Director onApril 7, 2010. Shri Dhingra is a Masterin Commerce (M.Com) and Master inBusiness Administration (MBAFinance) from Faculty of Management Studies (FMS), Delhi University. Hehas acquired additional Bankingqualifications from India (CAIIB) and
UK (ACIB, London). He secured thefirst rank in three of the courses onbanking conducted by the Institute of Banking and Finance, Mumbai. Heholds the distinction of being the onlyIndian who passed A.C.I. B. (London)examination globally in July 1997.
He is also presently the Vice-Chairmanof Standing Committee on Public
Enterprises (SCOPE), an Apex body of the PSUs.
Prior to his joining ITI Ltd., he wasChairman and Managing Director,Housing & Urban Development Corporation Ltd. (HUDCO) and
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 9/101
9ARYANS SCHOOL OF MANAGEMENT
Director (Finance) in Mumbai RailwayVikas Corporation Limited (MRVC), aPSU under the Ministry of Railwaysand also in Indian Rare Earth Limited(IREL), a PSU under the Department of Atomic Energy.
Shri B P Gupta
Director (Finance) Shri B.P. Gupta was appointed asDirector Finance and a member of the Board of Directors of ITI Ltd. onDecember 31, 2007. An Honours inB.Com. he qualified as Chartered
Accountant in 1976. After severalstints in private and public sectorcompanies, Shri Gupta began his careerwith ITI as Chief Manager Finance in1989. Working in different Plants, heacquired well-rounded experience of over 33 years. Previously he held theposition of General Manager Financeat the Corporate Office of the Company.
Shri K K Khurana
Director (Human
Resources)
Shri K.K. Khurana joined ITI asManagement Trainee in 1973 soonafter obtaining a B.Sc. Engineeringdegree and Post Graduate Diploma inElectrical Engineering. In a career that spans over 35 years in the company, hehas held several important positions.His vast experience covers the diversefields of manufacturing, marketing,turnkey projects and HR. He was aProject Director for GSM-MTNLNetwork in Delhi (2002-04) and CircleProject Director for executing of BSNL-GSM Network in Gujarat Circle (2005-06). Prior to his appointment on thecompanys Board he was GeneralManager of Bangalore Plant. ShriKhurana has been Director, Human
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 10/101
10ARYANS SCHOOL OF MANAGEMENT
Resources of ITI Ltd. since April 4,2008.
Shri R K Agarwal
Director (Marketing) Shri R K Agarwal took over asDirector (Marketing) of ITI Ltd fromMarch 9, 2010. Prior to this, he wasGeneral Manager (CorporateMarketing). An industrial engineeringgraduate, Shri Agarwal joined ITI Ltdin 1976 as an assistant executiveengineer in the Companys BangalorePlant. Shri Agarwals 33 yearexperience spans areas such as
manufacturing, quality control andmarketing.
Shri K.K. Gupta
Director(Production) Shri K.K. Gupta took over as Director(Production) of ITI Limited on May 1,2010. Prior to this, he was GeneralManager, Corporate HR and GSM(South Zone). An Electronics andTelecommunication Engineer, Shri
Gupta joined ITI in 1977 as anAssistant Executive Engineer at theCompanys Naini Plant. Shri Guptas 33years of experience covers the diversefields of manufacturing - telephonesand transmission, GSM projects andhuman resources.
Shri.A.K. Srivastava
Director
Lt.Gen.P.Mohapatra
Director
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 11/101
11ARYANS SCHOOL OF MANAGEMENT
COMPANY SECRETARY
Shri K.T.Mayuranathan
Company Secretary
INDEPENDENT DIRECTORS
Shri A.K. Jain
Independent Director
ShriV.H.Ron
Independent Director
Shri A.S. Bansal
Independent Director
ShriKeshavSaran
Independent Director
Prof.M. Balakrishnan
Independent Director
ShriT.S.Narayanasamy
Independent Director
Dr. S.K. Chaudhury
Independent Director
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 12/101
12ARYANS SCHOOL OF MANAGEMENT
MANUFACTURING UNITS
Karnataka
Bangalore Hossur
U ttar Pradesh
Mankapur, Raebareli, Allahabad
Other units
Srinagar, Palakkad
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 13/101
13ARYANS SCHOOL OF MANAGEMENT
INFRASTRUCTURE
It has seven manufacturing units spread in different parts of India. Three
of them are in Uttar Pradesh.
BANGALORE COMPLEX (KARNATAKA)
Established - 1948
ISO Certification - ISO 9001
Products - Switching Product,
Defence Products,
Telephone parts
ELECTRONIC CITY UNIT (BANGALORE)
Established - 1987
ISO Certification - ISO 9002
Production - Digital exchange Parts
NAINI UNIT, ALLAHABAD (UP)
Established - 1968
ISO Certification - ISO 9001
Product - Wireless Local 100TS
RAIBAREILY UNIT (UP)
Established - 1970
ISO Certification - ISO 9001
Product - Electromechanical
Exchange Parts, digital
Exchanges
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 14/101
14ARYANS SCHOOL OF MANAGEMENT
PALAKKAD UNIT (KERELA)
Established - 1976ISO Certification - ISO 9002
Product - E-10 B Excanges, O. C. B
283 Exchange
SRINAGAR UNIT (JAMMU AND KASHMIR)
Established - 1982
ISO Certification - ISO 9001:2001Product - E-10 B Excanges, O. C. B
283 Exchange
MANKAPUR UNIT (UP)
Established - 1982
ISO Certification - ISO 9001:2001
ISO 14000Product - E-10 B Excanges, O. C. B
283 Exchange
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 15/101
15ARYANS SCHOOL OF MANAGEMENT
ITI HAS ELEVEN REGIONAL OFFICES:-
Bangalore Kolkatta Chennai
Delhi Lucknow Mumbai
Bhuvaneshwar Hyderabad Ahmedabad
Bhopal Kochi
The corporate office ITI limited is situated at Bangalore. The ITI product is of good quality of international standards approved by ISO. It has various sales
office within India.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 16/101
16ARYANS SCHOOL OF MANAGEMENT
MISSION
The mission of the company is to be the leader in the domestic market and
an important global player in voice, data and image communication byproviding total solutions to the customers, to build on core competencies to
enter into new business areas.
The company manufactures entire range of telecommunication system. ITI
is involved in design, development, manufacturing and installation and
commissioning of telecommunication system to meet specific need of
customers.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 17/101
17ARYANS SCHOOL OF MANAGEMENT
OBJECTIVES
To generate demand for telecom products through innovation.
To maintain an overall growth rate of 30% per year.
For each existing business it should match at least the industry
growth rate.
To strengthen the technology scanning capabilities to benchmark
the organization product /services against global standards, to
identify the potential partners. To achieve global quality standards
in all the products in the shortest time.
To introduce effective production planning and control systems
for achieving delivery schedule streaming production over the
whole year and better inventory control.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 18/101
18ARYANS SCHOOL OF MANAGEMENT
OBLIGATION
TOWARDS THE CITIZENS OF INDIA:-
y Also an autonomous government company, functioning under the
Indians Companys Act and its memorandum and articles of
Association of the company subject to the entire Auditor General
of India, it is accountable to the people of India, the tax payer
through the parliament and government for running a highly
sophisticated technically oriented company, engaging in the
manufacturing of all the types of telecommunication equipmentand alike products and incidentally carry out applied research and
development to meet he need of the country as well as world
market in the field of telecommunication.
y Attracting competent technical personnel and by developing their
optimum skills and capabilities in a congenial working
environment providing employment opportunities for
advancement and other incentives.
y Developing and sustaining a favourable employee attitude and
motivation and obtaining maximum contribution by the
employees through stable and standing employment
opportunities, adequate wages keeping in view the REGION CUM
INDUSTRY basis of remunerations and commensurate with the
capacity to pay and connect with the production, good working
condition and job satisfactions.
y Establishing a system of redress of employees grievances in the
shortest possible times at various levels including the lowest level.
Providing and attaining facilities and opportunities for self
development in their current job and for advancement.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 19/101
19ARYANS SCHOOL OF MANAGEMENT
TOWARDS CUSTOMERS:-
y To serve the post and telegraph department and other
government, quasi and semi government departments requiring
telecommunication equipment by providing prompt, courteous,
dependable and sophisticated services adopting sound business
and commercial practices.
To sell products of high quality at prices fixed and determine in
the best interest of the nation, the company and the customer,
keeping in view that the customers are charged prices comparable
to landed costs of the similar components.
TOWARDS SUPPLIERS:-
y Ensuring prompt dealings based on integrity, impartiality and
courtesy.
y Making available to them the benefits of research skills and
information in order to promote indigenous services.
TOWARDS THE COMMUNITY:-
y The company accepts its social obligation to the communication
and villages contiguous to the factory and on to whose land the
factory is located.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 20/101
20ARYANS SCHOOL OF MANAGEMENT
ITI CONTRIBUTION TO NATIONAL TELECOM
INFRASTRUCTURE-
Switching Line (Mn.Lines)
Switching line
ITI Ltd 28 36.6%
Other 48 67.4%
Sales
ITI Ltd
t¡
er
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 21/101
21ARYANS SCHOOL OF MANAGEMENT
TRANSMISSION (LAKH ROUTE KMS.)
ITI Ltd 3.2 72%
other 1.2 28%
Sales
ITI Lt¢
other
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 22/101
22ARYANS SCHOOL OF MANAGEMENT
LONG DISTANCE TRUNK LINES (MN.LINES)
ITI Ltd 4.1 77%
other 1.2 23%
Sales
ITI Ltd
other
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 23/101
23ARYANS SCHOOL OF MANAGEMENT
FIXED PHONE (MILLION)
ITI Ltd 24 47.5%
other 26.4 52.5%
Sales
ITI Ltd
£
t¤
er
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 24/101
24ARYANS SCHOOL OF MANAGEMENT
MOBILE PHONES (MILLION)
ITI Ltd 0.6 2.1%
other 25.7 97.9%
Sales
ITI Ltd
other
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 25/101
25ARYANS SCHOOL OF MANAGEMENT
AWARDS AND ACHIEVEMENT
S afety Awards To Raebareli, Palakkad, And Bangalore
Three plants of ITI have won the national safety award for outstanding
performance in industry. Safety during the year 2004 which were presented at a
function held New Delhi recently
Raebareli & Palakkad received the award for achievement based on
longest accident free year. The turn up award based on longest accident free
year was awarded to Bangalore and Raebareli respectively.
E nergy conversation awarded to mankapur ITI mankapur plant which saved energy to the tone of 384 lakh during the
last three year has won the national energy conversations award in 2004.
First prize for best productivity in1990 by national productivity
council.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 26/101
26ARYANS SCHOOL OF MANAGEMENT
SALIENT FEATURES OF MANKAPUR UNIT
Established --------- 1982
Start of construction --------- 31/05/1983
Start of production --------- April 1985
Annual capacity --------- 500KL (E-10B)
Capital cost of E-10B CSN --------- 500KL (CSN-DCB-283)
CSN --------- Rs. 219.00 Cr
MAK-L --------- Rs. 31.41 Cr
Land --------- Rs. 3.30 Cr
Factory covered area --------- 35 AcresAir conditioned area --------- 77,500 sq.m
FDV space in factory --------- 44,300 sq.m
Compressed air --------- 2000 sq.m
Installed capacity of power station --------- 7000 sq.m
16000 KVA from UPSEB
& 5800 Captive
Water storage capacity --------- 50 Lakhs litres
Annual capacity of component plant --------- 18,00,000 connectors
10,00,000 relays
14,00,000 C&T
15,000 MDF
Mechanical -------- Rack 3,500
Hybrids 1,80,00,000
PCBs 26,000 sq.m
ISO certification -------- 9001:2000 &
14000
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 27/101
27ARYANS SCHOOL OF MANAGEMENT
ABOUT THE MANKAPUR UNIT
Mankapur unit was established in 1982 with technical collaboration with CIT
A
LCA
TEL France to manufacture E10B type of digital switching system.
It manufactures MAX-L & MAX-XC exchange based on C-DOT technology which
replaced the E10B exchanges. The unit is also manufacturing C SN-MM racks
used in exchange.
ITI Ltd. Mankapur has made a significant place in the electronic map of India
and has earned the distinction of DIGITAL CITY OF INDIA.
ITI Ltd. Mankapur has also entered into the non-communication field with its
note counting machine, note bundling machine, inverter etc.
It is the first unit in India which got the opportunity to manufacture BTS. It
started manufacturing BTS in the year 2005.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 28/101
28ARYANS SCHOOL OF MANAGEMENT
MORE ABOUT I.T.I
Multi-locational state-of-the-art electronic assembly & component
manufacturing facilities accredited with ISO 9001:2000
Multi-locational ISO 14001 :2004 Environmental Management
System certified plants First Indian company to manufacture BTS &
other infra products for GSM / WiMAX
Countrywide marketing and customer care centers
In-house R&D for absorption of technology, indigenous development
of products for in-house manufacturing
RESOURCES: Dedicated Network Systems Unit (Bangalore, New
Delhi, Kolkata, Bhopal, Ambala) . State-of-the-art Manufa~turing
Plants (Bangalore, Mankapur, Rae Bareli, Naini, Palakkad, Srinagar) .
R&D Centre
SMPS: Fabrication of 100 A - 150A Power Plants with 25A base
Module for GSM. Fabrication of 200A-3000A' Power Plants with 100A
base Modules for telecom installation
PRODUCTS:--CellularMobileInfrastructule-GSM,WLL-
CDMASwitching-OCB-283, ISDN EPABX, IP-TAX, SSTP. Transmission-
Satellite, Optical, Microwave, VHF /UHF. Broadband Equipment-
ADSL, WiMAX, G-PON, EDW AS. Customer Premises P-equipment-
IFWT, ADSL Modem, CLI Phones. GSM-FCT (Fixed Cellular
Telephone),; WiMAX CPE
SERVICES: Systems Integration - Telecom, IT. Shared Hub V -SAT
Services. Customer Care Service. Installation & Commissioning of
Telecom Eqpt like GSM, CDMA, MLLN, Microwave, Optical Fiber, etc.
Pre-warranty & Post-warranty maintenance sefYices for all
Products/Projects. Services for all products/projects: . Enterprise
businesses like Data Centers etc.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 29/101
29ARYANS SCHOOL OF MANAGEMENT
MILESTONES
1948: First public sector to be set up by post-independent India, with
assembly of 25000 telephone instruments & equal number of exchange
lines in technical collaboration with automatic telephone & electric
company of England.
1950: Corporate status as joint stock company. Diversification of product
range with the product of long distance equipment.
1964: Manufacture of Crossbar automatic exchange equipment of
Bangalore in collaboration with Bell Telephone Manufacturing Company,
Belgium.
1971:Manufacture of Multiplex & Associated Transmission1 equipment
for Trunk services at Naini. Components manufactured plant at
Srinagar(J&K).
1973: Telephone Instrument Plant at Naini.
1974: Stronger Switching equipment plant at Raebareli.
1976: Manufacture of Electronic Automatic Exchange of Palakkad.
1980: Crossbar switching equipment plant at Raebareli.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 30/101
30ARYANS SCHOOL OF MANAGEMENT
1983: Manufacture of electronic exchange of E-10B type for Mankapur in
collaboration with ALCATEL, France.Manufacture of digital trunk automatic
exchange
Equipment at Naini in collaboration of Kokusai,Japan.Agreemant with
Nippon Electric Corp. Japan for a host of Long Distance Transmission
Equipment.
1986: Established in a Net Work Unit exclusively to make care of
installation & maintenance work.
1987: Manufacture of Small & Rural Electronic Exchange of C-DOT
technology at electronic city, Bangalore. Manufacture of Digital coaxial
system at Bangalore with know-how from AT& T Net Work System,
Netherland.Manufacture of Opto-Electronic Line Equipment at Naini in
collaboration with NKT Denmark. Joint Venture company India SATCOM
Ltd.(ISL),set up with Equatorial Pacific International Company.Netherland
& Unit Trust of India, at Bangalore for manufacture of SATCOM System.
1991: Manufacture of IDR Modems at Bangalore with know-how obtained
from huge network system, USA.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 31/101
31ARYANS SCHOOL OF MANAGEMENT
1992: Launched Joint venture company, ITI Communication pvt. ltd.at
Singapore to act as export wing of ITI products.ISO-9000 accrediction
process.
1993: OCB 283/CSM in collaboration with ALACTEL, France.Manufacture
of Electronic switching system.
1994: Manufacturing set up established at Delhi for SDH Transmission
systems through Joint Venture Company -FIBCOM & Naini Plant. The name
changed to ITI LTD.With new companies identity. Turn over crossed
RS.1500 cores (US$ 350Mn)
1996: ITI.Ltd. Entered into V-SAT services.
1997: Release of 1st 40 k lines C-DOT MAX-XL Exchange to DOT. Launching
of MRTS.
1998: ITI's turn- around after set back due to opening of economy.VLSI-
II,One Micron FAB facility inaugurated at Bangalore plant.ISO9000
accreditation process completed for all plants.
1999: ITI-ALCATEL, New Technology Agreement signed. All time high
physical production performance. Turn over crossed RS1600Cr.(US $
400Mn)
2000: Turnover crossed an all time high Rs2000 Cr.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 32/101
32ARYANS SCHOOL OF MANAGEMENT
MAIN DIVISION
Mobile project division.
Switching exchange assembly plant
Component division
Circuit division
Central services division
PRODUCT OF ITI MANKAPUR:-
E-10B exchange
CSN-MA exchange
CSN-MM exchange
C-dot Exchange
Base transmission station
The above products are the telecom products. The non-telecom products are:-
Note counting machine Fake note detection machine
Invertors
UPS
Note bundling machines
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 33/101
33ARYANS SCHOOL OF MANAGEMENT
CUSTOMERS:-
Indian customers
Defence
Railways
Department of telecom
Oil sectors
Bank/factories/offices
GLOBAL CUSTOMERS:-
MALAYSIA AFGANISTAN
NEPAL
SWITZERLAND
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 34/101
34ARYANS SCHOOL OF MANAGEMENT
RESEARCH METHODOLOGY:
Research methodology is considered as the nerve of the project. Without a
proper well-organized research plan, it is impossible to complete the project and
reach to any conclusion. The project was based on the survey plan. The main
objective of survey was to collect appropriate data, which work as a base for
drawing conclusion and getting result.
Therefore, research methodology is the way to systematically solve the resea rch
problem. Research methodology not only talks of the methods but also logic
behind the methods used in the context of a research study and it explains why a
particular method has been used in the preference of the other methods
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 35/101
35ARYANS SCHOOL OF MANAGEMENT
RESEARCH DESIGN
Research design is important primarily because of the increased complexity in
the market as well as marketing approaches available to the researchers. In fact,
it is the key to the evolution of successful marketing strategies and
programmers. It is an important tool to study buyer¶s behavior, consumption
pattern, brand loyalty, and focus market changes. A research design specifies
the methods and procedures for conducting a particular study. According to
Kerlinger, ³Research Design is a plan, conceptual structure, and strategy of
investigation conceived as to obtain answers to research questions and to
control variance.
retailers/dealer and. However it was exclusively personal interview
DATA COLLECTION:
This report was prepared after collecting data from the retailers/ dealers and past
data was arranged from the various studies conducted in last few years and
various other records of company.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 36/101
36ARYANS SCHOOL OF MANAGEMENT
SECONDARY DATA:
SInformation regarding the project, secondary data was also required. These
data were collected from various past studies and other sources of the company.
SAMPLING METHOD
Random Sampling method
SAMPLE SIZE
100 Dealers
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 37/101
37ARYANS SCHOOL OF MANAGEMENT
ERP USED IN ITI LIMITED
The ERP used in ITI Limited is BAAN. Some of the features of BAAN are: -
y BAA
N was founded by Jan Baan in 1978 in Netherlands.y Baan manufacturing control system was first developed by Baan
for MRPI, CAP and MRP2
y The company BAAN have become one of the worlds biggest
software group and experts to remain on fast track for the forcible
future .
y BAAN solutions are used to achieve and streamline the planning
process by integrating diverse information, ensuring smooth
planning with the help of BAAN and get better decision support.
y The version of BAAN used in ITI is BAAN IV: Version B40C72.
y BAAN was implemented in 2001 in ITI Limited.
y There are basically four modules of BAAN used in ITI:-
1. BAAN IV FINANCE
2. BAAN IV MANUFACTURING
3. BAAN IV DISTRIBUTION
4. BAAN IV SERVICES
BAAN IV FINANCE includes:-
General ledger
Account receivables
Account payable
Cash management
Tax deductions at source
Cost allocation
Financial budget system
Financial statement
Fixed assets
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 38/101
38ARYANS SCHOOL OF MANAGEMENT
Tables
Common data
Finance parameter
WHY ITI HAS GONE FOR BAAN?
S.No. BAAN SAP
1. Very strong for discrete
manufacturing industries.
Very strong for process industries
& finance companies
2. Long relation with CMC for
hardware maintenance.
CMC was implementation
partner.
3. License fee is comparatively cheap. License fee was comparatively
high.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 39/101
39ARYANS SCHOOL OF MANAGEMENT
ISO
ISO stands for International Standards for Organisation. ISO is a world wide
federation of national standard bodies. The work of preparing international
standard is normally carried out through ISO technical committee. Each
member body interest in a subject for whom a technical committee has been
established has the rights to be represented on that committee standards, are
the levels of excellence in everything, that we can do, so it was felt that there
should be a global system of standards and hence ISO came into existence. Its
office is located in Geneva (Switzerland).
ISO STRUCTURE:-
100 or more countries.
9000 standards.
200 technical committees.
800 sub-committees.
2500 engineers.
TYPES OF ISO DOCUMENTS:-
Specifications
Guidance
Guides/tools
Technical reports.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 40/101
40ARYANS SCHOOL OF MANAGEMENT
BENEFITS OF ISO
Customer loyalty
Repeated business and referral
Reduction in cost and cycle time
Self esteem
Recognition
Confidence of interested party
ISO:9000
ISO 9000 describes fundamental of quality management system & specifies the
terminology for quality management system.
ISO:9001
ISO 9001 specifies requirements for QMS where an organization needs to
demonstrate ita ability to provide products that meets customer and
applicable regulatory requirements and aims to enhance customer satisfaction.
ISO 14000
System efficiency
Scrap and waste reduction
Pollution prevention
Improved environment performance
Implementing government regulations. PHILIPS, Australia was the first
company in the world to take ISO 14000 certificate.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 41/101
41ARYANS SCHOOL OF MANAGEMENT
MAJOR DIFFERENCES:-
ISO 9000:1994 ISO 2001:2000
Put stress on documentation put less stress on documentation but
more on objective clarity.
Continuous growth phenomenon Continuous growth phenomenon
More oriented to manufacturing generic nature to suit any sector
not addressing the improvement Measuring approach and objective
with strong customer focus.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 42/101
42ARYANS SCHOOL OF MANAGEMENT
PARAMETERS OF ISO:-
Quality:-
It is the total characteristics of any thing that bears the ability to satisfy
the stated or any implied needs.
Objectives:-
Objectives of any organization represent the goals which it aims to
achieve and the priority requirements. ISO standards lay stress on
SMART objectives,
Simple
Measurable
Achievable
Realistic
Time bound
ISO 9004
The ISO 9004 provides guidelines that consider both the effectiveness and the
efficiency of the QMS.
The aim of the standard is the improvement of the performance of the
organization and satisfaction of customers and other interested parties.
ISO 19011
ISO 19011 provides guidelines on auditing quality.
ISO 14000
The growth of human civilisation is marked by rapid industrialisation. The rapid
and blind growth of industries without paying head to the envir onment can
wreck havoc on earth. ISO 14000 standards is known as environment
management system.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 43/101
43ARYANS SCHOOL OF MANAGEMENT
Q UALITY PRINCIPES
Customer focus
Leadership
Involvement of peoples
System approach to management
Process approach
Continued improvement
Factual approach to decision making
Mutually beneficial supplier relationship
PDCA CYCLE
This is a methodology to achieve the goals set by the objectives: -
P: plan
D: do
C: check
A: act
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 44/101
44ARYANS SCHOOL OF MANAGEMENT
SIX SIGMA
SIX SIGMA is the most important training thing we ever had. Its better than
going to Harvard Business School; it teaches you to how to think differently.
Jech Welch
(in April 1999 interview)
DEFINITION:-
Six Sigma is a measure of quality that strives for near perfection. It is a rigorous
and systematic methodology that utilises information verified by facts and
statistics to measure end improve an organizations operational performances,
practice and system by identifying and preventing defects in manufacturing
and services related processes in order to anticipate and exceed expectations
of all public stakeholders to accomplish effectiveness.
Six Sigma is a process which talks about the ultimate quality.
Six Sigma can be described as the TQMS(total quality management system)
that it is a series of steps which involve statistical measurement that tells us
how good our product, services and processes really are.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 45/101
45ARYANS SCHOOL OF MANAGEMENT
HISTORY OF SIX SIGMA
measurement standard in the product variation can be traced back to the
1920s when Walter Shewhart showed that three sigma from the mean isappoint where the process requires correction. Many measurement standards
(CPK, zero defects etc.) later came on the scene but credit for coining the term
SIX SIGMA goes to a Motorola engineer named Bill The roots of six sigma as a
standard can be traced back to Curl Fredrick Gauss (1777-1855) who
introduced the concept of normal curve. Six Sigma as a Smith(incidently SIX
SIGMA is a federally registered trademark of Motorola).
Inn the early and mid 1980s with Chairman Bob Galwin at the helm, Motorola
engineers decided that the traditional quality level in measuring defects inthousands of opportunity didnt provide enough granularity. Instead, they
wanted to measure the defects per million opportunities. Motorola develop
this new standard and created the methodology and needed cultural change
associated with it. Six Sigma helped Motorola realise powerful bottom -line
results in their organization. In fact they documented more than $16million in
savings as a results of their Six Sigma efforts.
Since then hundreds of companies around the world have adopted SIX SIGMA
as a way of doing business. This is a direct result of many of Americas leader
openly praising the benefits of SIX SIGMA, such as Larry Bossidy of Allied
Signal(new Honeywell) and Jack Welch of General Electric Company .rumor has
it that one day Larry and Jack were playing golf and Jack bet Larry that he
could implement SIX SIGMA faster and with greater results in GE than Larry did
it in Allied Signal. The results speaks for themselves.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 46/101
46ARYANS SCHOOL OF MANAGEMENT
SIX SIGMA PHILOSPHY
Customers need product and services in time with zero defects, at the
lowest cost. To improve means we must be able to predict and prevent, not detect
and react.
By combining the mean and standard deviation, the sigma of a process
can be calculated.
The sigma of a process tells us how capable it is.
Once basic competencies ad deficiencies are known corrective measures
can be taken.
Corrective measures lead to the reduction of defects, cycle time and the
cost. The reduction of defects, cycle time and cost leads to improved
customer satisfaction.
As customer satisfaction improves, likelihood of doing good business
increases.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 47/101
47ARYANS SCHOOL OF MANAGEMENT
SIX SIGMA SCALE
(yield to sigma conversion table)
SIGMA PPM YIELD
1 6,90,00O 30.90%
1.11 6,50,000 35.00%
1.22 6,10,000 39.00%
1.32 5,70,000 43.00%
1.40 5,40,000 46.00%
1.50 5,00,000 50.00%
1.60 4,60,000 54.00%1.70 4,20,000 58.00%
1.80 3,82,000 61.80%
1.90 3,44,000 65.60%
2.00 3,08,000 69.20%
2.20 2,42,000 75.80%
2.30 2,12,000 78.80%
2.40 1,84,000 81.60%
2.50 1,58,000 84.20%
2.60 1,35,000 86.50%2.70 1,15,000 88.50%
2.80 96,800 90.38%
3.00 66,800 93.31%
3.10 54,800 94.52%
3.20 44,600 95.54%
3.30 35,900 96.41%
3.40 28,700 97.13%
3.50 22,700 97.73%
3.60 17,800 98.22%
3.70 13,900 98.61%
3.80 10,700 98.93%
3.90 8,190 99.18%
4.00 6,210 99.38%
4.10 4,660 99.534%
4.20 3,460 99.654%
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 48/101
48ARYANS SCHOOL OF MANAGEMENT
4.30 2,550 99.746%
4.40 1,860 99.814%
4.50 1,350 99.865%
4.60 960 99.904%
4.7 680 99.932%
4.80 480 99.952%
4.90 330 99.967%
5.00 233 99.977%
5.12 150 99.985%
5.21 100 99.990%
5.31 70 99.993%
5.44 40 99.996%
5.51 30 99.997%
5.61 20 99.998%
5.76 10 99.999%
5.81 8 99.9992%
5.92 5 99.9995%
6.00 3.4 99.9997%
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 49/101
49ARYANS SCHOOL OF MANAGEMENT
TAXES &DUTIES
SERVICE TAX
Service tax is a kind of sales tax on services. It is charged from consumer of
services along with the price of the services rendered, collected by the service
provider & represented in the government treasury.
Some important points about Service tax are as follows.
The provision relating to Service tax were brought in to force with effect
from 1 July 1994. The Service brought under the tax net in the ye ar1994-
95 are as follows:
1) Telephone 2)stock broker 3)general insurance In India the introduction of tax on services ends recommended by the
chellian-committee was formed to suggest tax reforms measures in India.
It contributes more than 50% of DP in Indi a and come under indirect
taxes.
The most important article that prohibits arbitory collection of tax is
article 265, which reads as ³no tax shall be levied or collected expect by
the authority of law´.
Service tax is levied on the gross amount charged by the service provider
from the client.
India has adopted a selective approach for taxation of services.
Services mainly be divided into three list on the basis of government
responsible for collection of tax.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 50/101
50ARYANS SCHOOL OF MANAGEMENT
1. UNION
For service this central government is responsible.
2. STATE-For service this state government is responsible.
3. CONCURRENT-
For service this both the central as well as state government is
responsible for collection of Service tax.
Jammu & Kashmir don¶t have the Service tax.
FUTURE PROPOSAL ²
The former finance minister of India, Mr. P.Chidambaram in his budget speech
has indicated the government intent of merging al taxes like Service tax, excise
& VAT into a common goods & services tax by the year 2010. To achieve this
objective the rate of central excise & Service tax will be progressively altered
and brought to a common rate. In budget presented for 2008 -09 it was
announced that all small services provider & turnover doesn¶t exceed Rs.10lacs.
Need not pay Service tax.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 51/101
51ARYANS SCHOOL OF MANAGEMENT
OBJECTIVE OF SERVICE TAX
The basic objective of Service tax is:
Broadening the tax base.
Augmentation of revenue
Larger participation of citizen in the economic development of the nation.
Rate of Service tax
Service tax came into force w.e.f 01-07-1994 &initial rate of Service tax was
5% since then rate have changed from time to time.
Currently Service tax is levied at the rate of 12% wide charging section
66 of finance act 1994 (chapter 4) however wide Service tax notification no.
812009 dated 24-02-09 the central govt. exempts all the taxable services from
so much of the finance act, as in excess of the rate of 10% of the value taxable
Service.
Thus although charging 66 specifies rate @ 12% but effective rate of Service
tax will be 10% with effect from 24-02-09. In addition to the basic rate of 10%
education cess @ 2% & secondary & higher education cess a@1% are levied
service tax in respects of all taxable services.Thus effective rate of service tax as of now is 10.30%
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 52/101
52ARYANS SCHOOL OF MANAGEMENT
INCOME TAX
Income tax is a very important direct tax. It is an important & mostsignificant sources of revenue of the govt. income tax being a direct tax, is an
important tool to achieve balanced socio -economic growth by providing
concessions & incentives in income tax for various development purpose.
In India this tax was introduced for the first time in 1860, by sir James
Wilson in order to meet the looser sustained by the govt. on account of the
military mutiny of 1857. Thereafter, several amendments were ma de in it from
time to time. At last, in 1986, a separate Income tax act was passed. This act
remained in force up to 1917 with various amendments from time to time. In
1918, a new Income tax was replaced by another new act which has passed
1922. This act remained in force up to the assessment year 1961 -62 with
humorous amendments.
The Income tax act, 1961 has been brought in to force with effect from 1st
April 1962. It applies to the whole of India and Sikkim (including Jammu &
Kashmir).
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 53/101
53ARYANS SCHOOL OF MANAGEMENT
BASIS OF CHARGE OF INCOME TAX
The following basic principles emerge from the section:
1. Income tax is an annual tax on income.
2. Income of previous year is taxable in the next following assessment ±year
at the rile or roles applicable to that assessment - year however ,there are
exception to this rule.
3. Tax rates are fixed by the annual finance act.
4. Tax is charged on every person as defined in section &(31).
5. The tax is charged on the total income of every person computed in
accordance with provision of this act.
6. Income tax is to be deducted at the sources or paid in advance as provided
under the provision of the act.HEADS OF INCOME [SEC. 14]
As per sec. [14], income of a person is computed under the following fives
heads-
y Salaries
y Income from house properties
y Profits & gains of business & profession
y Capital gain
y Income from other sources.
The aggregate income under these heads is termed as ³gross total income´ in
other words gross total income means total income computed in accordance
with provision of the act 64 making any deduction under sec.80c to 80u.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 54/101
54ARYANS SCHOOL OF MANAGEMENT
INCOME FROM SALARY:
Meaning of ³salary´:- [sec.17 (1)]
The term ³salary´ is defined to include the following:-
a) Wages
b) Any annuity or pension
c) Any gratuity
d) Any fees, commission, perquisites or profits in live of or in addition to
any salary or wages.
e) Any advance of salaryf) Any payment received by an employee in respect of any period of leave
not availed by him
g) The portion of the annual accretion in any previous year to the balance at
the credit of any employee, participating in a recognized providend fund
to extend it is taxable.
h) Transfer balance in a recognized providend fund to the extend it is
taxable.
i) Contribution by the central govt. to the A/C of an employee under a
pension scheme referred to in sec.80ccd.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 55/101
55ARYANS SCHOOL OF MANAGEMENT
BASIS OF CHARGE [SEC. 15]
For the purpose of chargeability of tax, salaries consist of following.
Any salary due from an employer (or a former employer) to an assessee in
the previous yea, whether actually paid or not.
Any salary paid or allowed to him in the previous year by or on benefit of an
employer (or a former employer), though not due or before it became due.
Any arrears of salary paid or allowed to him in the previous year by or on
behalf of an employer (or a former employer), if not charged to income tax
for an earlier previous year.
Salary income is charg3eable to tax either or due to basis or on receipt basis.
Once salary has accrued, its subsequent waiver is only on application of
income & is liable to be taxed. Income is taxab le is salary under sec. [15] if an employer ±employee relationship exists between the payer & payee.
ASSESSMENT YEAR 2008-09:-
For the assessment year 2008-09 tax rate are given below:
Women¶s (who is below 65 year at any time during the previous year).
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 56/101
56ARYANS SCHOOL OF MANAGEMENT
INCOME TAX
Net incomerange Income taxrange surcharge Educationcess Secondary &higher Edu.Cess
Upto
Rs.1,45,000
Rs.1,45,000 to1,50,000
Rs.1,50,000 to2,00,000
Rs.2,00,000 to10,00,000
AboveRs.10,00,000
Nil
10% of totalincome
Nil
Nil
Nil Nil
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 57/101
57ARYANS SCHOOL OF MANAGEMENT
CUSTOM DUTY:-
A custom duty is a tariff or tax on the import or export of goods. In the
kingdom of England, custom duty duties were typically part of the customary,
revenue of the king & therefore did not need parliamentary consent to be levied,
unlike excise duty land tax or other former of tax.
The custom duty in India¶s is one of the most important tariffs. The
custom of 1962. The main purpose of custom duty in India is the presenta tion of
the illegal exports & imports of goods. The rates of custom duty levied on the
imported & exported goods are assigned in the custom act, 1962.
The main purpose of custom duty levied on the imported & exported
goods are assigned in the custom act, 1962.
TYPES OF CUSTOM DUTIES LEIVABLE:
In India, custom duties are levied on the goods at the rate specified in the
schedule to the custom tariff act, 1962.
The taxable event is import into or export from India. Export duty (2nd
schedule) are levied at present on leather, ironers & concentrates only but sweep
of import duty is very wide, almost universal, barring a fees goods like foodgrain, fertilizer life saving drugs, equipment etc.
Import duties generally consist of the following type ±
1. BASIC DUTY-
It may be at the standard rate or in the case of import from some countries at
the preferential rate [sec.2,custom tariff act,1975].
2. ADDITIONAL CUSTOM DUTY-
Additional custom duty equal to central excise duty is livable on the goods
produced or manufactured in India. Additional duties commonly referred to
as countervailing duty (CVD) Additional duty calculated on a value base of
aggregate value of the goods including landing charger &basic duty.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 58/101
58ARYANS SCHOOL OF MANAGEMENT
3. ADDITIONAL DUTY OF CUSTOM-
ADC not exceeding 4% (1% for article of jewellery) ,was levied under section 3(V) of the CTA,1975 in the budget 2005 in order to counter balance
various internal taxes like sales tax & VAT
4. Additional duty of custom is livable at @ Rs. 2% per liter on imported
motor spirit (petrol) & high speed diesel.
5. NATIONAL CALAMITY CONTINGENT DUTY (NCCD):
it is imported at present @Rs. 50/-per m.t. or imported oil @ 1% on mobile
phone, two wheeler motor cars & multi utility vehicles.
6. ANTI DUMPING DUTY/SAFE GUARD DUTY-
With a view to protecting domestic industry from unfair injury, anti dumping
duty/safeguard duty is imposed on import of specified goods.
7. EDUCATION CESS/SECONDARY & HIGHER EDUCATION CESS:-
8. EC @ 2% & further secondary & higher education cess @1% of aggregate
duties of custom is livable.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 59/101
59ARYANS SCHOOL OF MANAGEMENT
EXCISE DUTY
DEFINATION- An excise of duty is a type of tax charged or goods produced within the
country.
CENTRAL EXCISE DUTY- INTRODUCTION-
The general rate of basic excise duty (BOD) reduced to 8% (As per
charges made on feb24, 09) Extension of the earlier 4% cut in excise duty
beyond 31 march 09 (as per charge 24, 09) 1% less for secondary & higher
education introduced.
For small scale exemption the turnover ceiling is increased from Rs.10
million to 15 million .the valuation rule of all the goods manufactured by
worker has been introduced.
The effective rate of petrol & diesel is reduced from 8% to 6%.
The settlement of commission provision is to be amended.
The e-payment becomes mandatory in cases where the annual excise duty
payable is in excess of Rs.5 million.
The excise duty is lived in of entry 45 of the central list in government of India act, 1935 as adopted by entry 84 of list -1 of the seventh schedule of the
constitution of India, charging section is sec.3 of the central excise 4 salt, act
1944.
In order to give a broad guide as to classification of goods for the purpose
of duty liability the central board of excise custom duty (CBEC) brings out
periodically & book called the ³INDIAN CUSTOMS TARIFFS GUIDE´ which
contain various tariffs issued by the CBEC.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 60/101
60ARYANS SCHOOL OF MANAGEMENT
IMPORTANT OF CENTRAL EXCISE DUTY
Central excise revenue is the biggest single source of revenue of the govt.
of India. The union govt. tries to achieve different socio-economic objectives by
making suitable adjustment in the scope & quantum suitable adjustments in the
scope & quantum of central excise duty. It is suitable adopted & modified to
sense different purpose of price control, sufficient supply of essential
commodities industrial growth, promotion of small industries like authority for
collecting CED. Article 265of the constitution of india has laid down that both
collection of taxes shall be under AOL.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 61/101
61ARYANS SCHOOL OF MANAGEMENT
SALES TAX -
DEFINITION-
sales tax is a tax levied on the sale or purpose of goods. There are two kinds of
sales tax-
Central sales tax imposed by each state. Sales tax in India is imposed
under both central &the state legislation. The govt. levied sales tax principally
on intra sale `of goods. State also levies ³sales tax on transaction which are
deemed sales´ like works contracts leases.
Sales tax is an indirect form of tax, where in it is the responsibility of the
seller of the commodity to collect & recover the tax from the p urchase.
generally sale of imported item & sale by way of export are not commodities
which require payment of sales tax.
General sales tax (CST) act that falls under the directions of the central
govt. takes in to account all the intevelate states of comm odities. Thus sales tax
is to be paid by every dealer on the sale of any commodity, made by him during
interstate trade or commerce irrespective of the fact that no liability to pay tax
on the sale of goods arises under the tax of laws of the appropriate s tate. He is to
pay sales tax to the sales tax authority of the state from which the movement of
the commodities commences. However from April 1, 2005 most of the states in
India have supplemented sales tax with a view VALUE ADDED TAX (VAT)
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 62/101
62ARYANS SCHOOL OF MANAGEMENT
INTERSTATE SALE-
According to section 3, a sale or purchase shall be deemed to take place in the
course of interstate trade or commerce in the following cases -
When the sale or purchase occasions the movement of goods from one
state to another.
When the sale is effected by a transfer of document of title to the goods
during their movement from one state to another.
To make a sale as one in the course of interstate, trade these must or an
obligation to transport the goods outside the state. The obligation may be of the
seller or the buyer. It may arise by reason of statute or contract between the
parties or from mutual understanding or agreement between them or , even from
the nature of transactions.
MAIN PRINCIPLES IN STATE SALES TAX LAWS-
A sale or purchase of goods is said to take place when the transfer of property
in the existing goods or future goods take place for consideration of money .
The goods have been divided into different categories & different rates of sales
tax are charged for different categories of goods.
In most of the cases related to the sales tax on the sale or purchase of
goods is at single paint
Generally a quarter return of sales or purchase is insisted upon the assesses is
required to furnish the return in prescribed from. At the time of assessment, the
assessee has to furnish all the documentary evidence & satisfy the concerned
sales tax.
The sales tax laws of the state prescribed the procedure to be followed in
case an assessee prefer to make an appeal. Every dealer should apply for registration & obtain a registration certificate to that effect. The registration
certificate no. should be quoted all the bill.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 63/101
63ARYANS SCHOOL OF MANAGEMENT
VALUE ADDED TAX (VAT)
INTRODUCTION-
The much awaited value added tax (VAT) has been introduced in India
taxation system from April 1st
2005, now it is a part of 130 countries which was
leaded first time in U.K in 1973. The Uttar Pradesh was the last state to
implement VAT & introduced in 1st
Jan 2008 called act 2008.
WHAT IS VAT?
Value added tax is modern & progressive form of sales tax. It is charged
& collected by the dealers the price paid by the customer. In India VAT has
been introduced in all the states for providing uniformity in tax rates.
VAT is centrally uniformity administered tax with a revenue staring
mechanism. Under the VAT system, no exemptions will be given & a tax will
be levied at each stage of manufacturing.
BENEFITS OF VAT:
y It is a simple, transparent & progressive.
y Business friendly system of taxation.
y
Simplification of tax form & procedures.y Reduction in the number of tax rates to only two main rates -4% to 12.5%
y Reduction in the effective tax rate for many goods.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 64/101
64ARYANS SCHOOL OF MANAGEMENT
TYPES OF BUSINESS ARE LIABLE FOR VAT:
VAT applies to all types of business including.
y Imports.y Manufacturers.
y Distributers.
y Wholesalers.
y Retailers.
y Work contractors.
y Lesser.
Under the VAT, the taxes are some goods of common consumption
12.5% for all goods unless they are listed under the other rates food grains
including pulses, milk, vegetables, & books are not subject of VAT.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 65/101
65ARYANS SCHOOL OF MANAGEMENT
IN ADDITION THERE ARE TWO OTHER RATES OF
SPECIFIC ITEMS:
p 1% for gold, silver, other precious metals precious & semi preciousstones & their jewellery
p 20% for liquor the only exception to others rates is for the sale of motor
spirit which have special tax rates based on the existing sales of motor
spirit taxation on act.1958. subject to a floor rate of 20%.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 66/101
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 67/101
67ARYANS SCHOOL OF MANAGEMENT
FINANCIAL STATEMENT
The financial statement contains summarized information of the firm¶s
financial affairs, organized systematically preparation of financial statement is
the responsibility of top management. The two basic financial statements
prepared for the purpose of external reporting to owners, investors, & creditors
1. Balance sheet.
2. Profit & loss account.
The various objective of financial statement are:
y To provide reliable financial statement about economic resources &
obligation of a business enterprises.
y To provide reliable information about the changes in net resources of
enterprises that result from the profit directed activities.
y To provide financial information that assist in estimating the earning
potential of enterprise.
y To provide other needed information about changes in economic resources &
obligation.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 68/101
68ARYANS SCHOOL OF MANAGEMENT
BALANCE SHEET
Balance sheet is one of the most significant financial statements. It
indicates the financial condition or the state of affairs of a business at a
particular moment of time. The Balance sheet communication information¶s
about assets, liabilities & owners equity for business firms as on a specific date.
ASSETS
Assets, representing economics resources, are the valuable possessions owed by
the firm assets may be classified as:
y Current assets
y Long term assets
CURRENT ASSETS-
Current assets sometimes also called liquid assets are those res ources of the firm
which are either held in the form of cash or expected to be converted in to cash
within the accounting period or the operating cycle of the business. Current
assets
Generally includes cash, marketable securities account receivable, inven tory,
loan & advances, prepaid expenses, bills receivable.
LONG TERM ASSETS-
Long term assets are held for period longer then the accounting period Long
term assets includes fixed assets Long term investment & other assets.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 69/101
69ARYANS SCHOOL OF MANAGEMENT
LIABILITIES-
Liabilities are debt payable in future by the firms to its creditors it may be of
two types.
y Current Liabilities
y Long term Liabilities
CURRENT LIABILITIES-
These are debts payable with in accounting period. Current assets are converted
into cash to pay current liabilities includes sundry creditors bills payable, bank
borrowing, provision, expenses payable.
LONG TERM LIABILITIES-
It is also called fixed Liabilities are the obligations or debts period. It includes
debenture, bonds & secured loans from financial institutions.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 70/101
70ARYANS SCHOOL OF MANAGEMENT
PROFIT & LOSS ACCOUNT
The earning capacity & potential of the firm are reflected by the income
statement or the Profit & loss account. The Profit & loss account presents the
summary of expenses & revenues, expenses & net income of afire for a period
of time. Thus it serves a measure of firm¶s profitability
NATURE OF REVENUES-
It can arise form:
y The sale of product to customer
y The rendering of services or the supply of firm¶s resources to others,
resulting in the receipt of rent, interest, dividend, royalty, commission,
fees etc.
y The sale of assets of the firm other than those held as stock in trade.
NATURE OF EXPENSES:
The cost of earning revenue is called the expense. Expenses occur when assets
are consumed on liabilities are increased in order to produce revenue. Cost isnot the same thing as expenses cost is an outlay incurred to acquire some asset
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 71/101
71ARYANS SCHOOL OF MANAGEMENT
FINANCIAL STATEMENT ANALYSIS
³Financial statement analysis is largely a study of relationship among the
various Financial statement of business enterprise as a disclosed by single set of
Financial statement & a study of these factors as shown in a series of
statement.´
Financial statement can be analyzed in two ways:
HORIZONTAL ANALYSIS:
Financial statement of an enterprise for a number of years is called
horizontal analysis, which may take the following two forms:
1. Comparative Financial statement2. Trend analysis
COMPARATIVE STATEMENT-
A simple method of tracing the period changes in the financial
performance of a company is to prepare Comparative statements. Comparative
financial statements will contain items at least for two periods.
TREND ANALYSIS:
In financial analysis the direction of changes over a period of yea rs is of
crucial importance. Trend analysis of ratios indicates the direction of changes
for trend analysis the use of index number is generally advocated. The
procedure followed is to assign the numbers 100 to items of other year in
relation of the base year.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 72/101
72ARYANS SCHOOL OF MANAGEMENT
VERTICAL ANALYSIS:
It is the analysis of financial data based on relationship among item in a
single period of financial statement.
For ex: various assets can be expressed as percentages of total assets.
Statements containing such analysis are called common size statements. The
common size profit & loss account is more useful in analyzing operating results
& costs during the years it shows each element of cost as a percent of sales.
Similarly common size balance sheet shows fixed assets is expre ssed as % of
total assets.
FINANCIAL ANALYSIS-
Financial analysis is the process of identifying the financial strength &
weakness of the firms by properly establishing relationship b/w the item of the
balance sheet & the profit & loss A/C.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 73/101
73ARYANS SCHOOL OF MANAGEMENT
RATIO ANALYSIS-
Ratio analysis is a very powerful analytical tool useful for measuring
performance of an organization. The ratio analysis helps the management to
analysis. The post performance of the firm & to make further projections. Ratio
analysis is comparison of data from one period to another and the appraisal of
the ratios to make proper analysis about the strength & weakness of financial
sub nature.
NATURE OF RATIO ANALYSIS:
A ratio is defined as the indicated quotient of two mathematical
expressions & as the relationship between two accounting figures, expressed
mathematical is known as a financial analysis. Ratio helps to summarize thelarge quantities of financial data & to make the qualitative judgment about the
firm¶s financial performance.
STANDARDS OF COMPARISON:
A single ratio in its self does not indicate favourable or unfavourable
condition. It should be compared with some standard. Standard of comparison
may consist of:
Ratio calculated from the past financial statement of the some firm .
Ratios developed using the projected financial statement of the some
firm.
Ratios of some selected firms, specially the most progressive &
successful at the same point in time.
Ratios of the industry to which the firm belong.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 74/101
74ARYANS SCHOOL OF MANAGEMENT
UTILITOF RATIO ANALYSIS-
The ratio analysis is the most important tool of the financial analysis,
with which one can determine:
y The extent to which the firm has used its long term solvency by
borrowing funds.
y The ability of firm to meet its current obligations.
y The efficiency with which the firm is utilizing its various assets in
generation sales revenue.
y The overall operating efficiency & performance of firm.
TYPES OF RATIO:
1. Profitability ratio.
2. Working capital ratio.
3. Growth ratio.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 75/101
75ARYANS SCHOOL OF MANAGEMENT
PROFITABILITY RATIO-
Profit is the difference between revenue & expenses over a period of time
profit is the ultimate output of the company, & it will have no future if it fails to
make sufficient profits.
The Profitability ratios are calculated to measure the operating efficiency
of the company. The purpose of studying & analyzing the Profitability ratio is to
help in assessing the adequacy of profits earned by the company & also to
discover whether the Profitability is increasing or decreasing.
Generally two major types of Profitability ratio are calculated:
y Profitability in relation to sales.
y Profitability in relation to investments.
UNDER PROFITABILITY RATIO:
y Profit before interest & taxes to capital employed.
[(Profit before tax + interest)*100] / (net fixed assets + net current assets)
y Profit before tax to sales & services % :
(Profit before tax) * 100 / sales & services
y Profit after tax to net worth:
(Profit before tax) * 100 / net worth
y Long term debt to net worth:
Long term debt / net worth
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 76/101
76ARYANS SCHOOL OF MANAGEMENT
WORKING CAPITAL RATIO-
The ratio analysis of working capital as means of checking upon the
efficiency with which working capital is being used in the enterprise working
capital ratio, which measures the liquidity of a firm & its ability to meet its
maturing short term obligation. Liquidi ty is defined as the ability to realize
value in money, the most liquid assets it refers to the ability to pay in cash the
obligation which are due.
GROWTH RATIO-
Growth ratio indicates the Growth of a company in a particular area in
comparison to previous years. Growth can be positive or negative. If the Growth
is positive then the firm is previous year & if negative then the result will bevice versa.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 77/101
77ARYANS SCHOOL OF MANAGEMENT
ACCOUNTING POLICIES
FIXED ASSETS
y Fixed assets are recorded at cost net of MODUAT relief wherever availed
y Fixed assets are required free of cost or gifted to ITI are recorded at
market value at the time of acquisition the amount of credit to capital
reserve.
y Any capital grant-in-aid given for a specific profit by any agencies is
initially credited to grant-in-aid and this amount is adjusted to P&L
account overt the useful life of assets.
y Expenditure on development of lease hold land is capitalized as land
development expenditure and is written off over a period of 5 year.Commencing from the year in which such expenditure is incurred.
INVENTORIES
y Raw materials, components & stores purchased are valued at weighted
average rates as at the end of the year. Where the same items are both
purchased & manufactured, manufacturing costs are generally adopted
for valuation.
y Raw material & production stores with ancillaries & fabrications are
valued at the cost as the time of issue to the ancillaries & fabricators.
y Manufacturing items in stock & stock-in-trade are valued at cost
excluding charges, administration overheads & sales overhead or the
realizable value whichever is less.
WORK IN PROGRESS
y Work in progress is valued on the basis of physically verified quantities at
cost excluding interest charges, administration overheads & sales
overheads or the realizable value whichever is less.y Work in progress is valued at cost as recorded in works orders.
y Precious metals scrap is valued & brought to book at the year end.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 78/101
78ARYANS SCHOOL OF MANAGEMENT
TOOLS AND CAUSES
y Expenditure on special purpose tools & fixtures is initially capitaliz ed for
amortization on is initially capitalized for amortization on production
based on technical assessment.
y Loose tools are charged to revenue at the time of issue.
DEFERRED REVENUE EXPENDITURE
y Expenditure on training personnel/foreign technician fees an d expenses,
pre-production expenses etc. specific to project/products is amortized
over production on technical estimates & to the extent not amortized is
came forwards.
RESEARCH & DEVELOPMENT
y Revenue expenditure on research & development is charged to the profit
& loss account in the year in which it is incurred.
y Capital expenditure on R&D is treated as addition to the fixed assets.
DEPRECIATION
y Depreciation is charged on straight line method in accordance with the
useful life of the assets as assessed by the management.y However the rates of depreciation adopted in the books are not lesser than
the specified is schedule 14th
of the company¶s act 1956.
PRIOR PERIOD ITEMS
Adjustment arising due to errors or mission in the financial statement of earlier
years are accounted under ³prior period adjustment if the amount involved in
rupees 5 lacs or more in each case.
RATE OF FOREIGN EXCHANGE
Current assets/liabilities towards imported equipments and components are
initially brought to account a exchange ruling on the date of availing the credit
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 79/101
79ARYANS SCHOOL OF MANAGEMENT
and are updated at the actual rate of exchange ruling on the date of the balance
sheet. The cons version difference at the balance is adjusted in P&L A/C. in
relation to fixed assets for any such liability the difference would be accounted
in assets account
RECOGNITION OF REVENUE
y A sale excludes sales tax & includes excise duty.
y Sales are set up based on dispatches/customer acceptance against valid
contracts.
y Where prices are not established, sales are set up provisionally at prices
likely to be realized.y Export sales are treated as sales on issue of bills of lading.
y Customers including liquidated damages for contract executed during the
year make provision separately for likely disallowance.
WARRANTY LIABILITY
y Expenses against warranty liability are accounted as and when incurred.
GOVERNMENT GRANT
Government grants relating to revenues are initially credited to grant -in-
aid thus amount is adjusted to the profit & loss account to the extent of related
costs, which they are intended to compensate.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 80/101
80ARYANS SCHOOL OF MANAGEMENT
PROFIT & LOSS ON LONG TERM
CONSTRUCTION/TURNKEY CONTRATS
Revenue is recognized on a percentage completion method. Theaccounting of contract revenue & contract cost associated with the contract are
recognized as a revenue & expenses respectively by reference to the stage of
completion of contract activity at the reporting date. Expected loss on the
contract is fully accounted.
RETIREMENT BENEFITS
y Gratuity liability is determined annually by actuarial valuation & covers
all employees. The incremental liability of each year is remitted into a
separate trust.
y Liability towards leave salary accruals is determin3ed on the basis of
actuarial valuation.
BORROWING COST
Borrowing cost that is directly attributable to the acquisition construction
or production of qualifying assets. A qualifying asset is a fixed assets which
require a substantial period to get ready for its intended use or investors what
requires substantial period to bring them to a saleable condition.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 81/101
81ARYANS SCHOOL OF MANAGEMENT
COMPARATIVE ANNUAL REPORT
(As on 31st
march 2009)
(Rs. In lacs)
Description 2008-09
(a)
2007-08
(b)
(a-b)
absolute
change inRs.
%
change
(%)
SOURCES OF FUNDS
Share holder¶s fund
Share capital 0.00 0.00 0.00 0.00Reserve & surplus 27,135.32 28,591.60 -1,456.28 -5.09
Grant-In-Aid 2,123.05 2,431.63 -308.58 -12.69
LOAN FUNDS
Secured loan 1,479.78 1,129.78 350 30.97
Unsecured loan 0.00 0.00 0.00 0.00
H.O & unit & Cr. balance 34,680.05 43,893.38 9,213.33 -20.99
H.O A/C profit 0.00 0.00 0.00 0.00
TOTAL 65,418.20 76046.39 -10628.19 -13.97
APPLICATION OF FUNDS
Fixed assetsGross block 57,468.29 56655.28 813.01 1.43
Less: depreciation 25,795.01 23516.64 2278.37 9.68
Net block 31,673.28 33138.64 -1465.36 -4.4
Capital work in progress 82.78 79.04 3.74 4.73
Investment 0.00 0.00 0.00 0.00
Current, assets & advance
Inventories 12,359.79 12774.10 -414.31 -3.24
Sundry debtors 89,542.61 65164.53 -55621.92 -85.35
Cash & bank balance 1,045.04 101.42 963.62 950.13
Loans & advance 12,759.71 14896.07 -2136.36 -14.34
Less: current liabilities &
provision
Current liabilities 1,52,017.88 72818.28 79199.6 108.76
Provision 4,211.22 2535.69 1675.53 66.07
Total 1,56,229.10 75353.97 80875.13 107.32
Net current assets 40,521.95 17528.15 22993.8 131.18
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 82/101
82ARYANS SCHOOL OF MANAGEMENT
H.O unit & Dr. balance 52,789.21 2952.62 49836.59 1687.87
Misc. expenditure 0.00 0.00 0.00 0.00
Head office A/C 21394.88 22293.94 -899.06 -4.03
Total 65418.20 76046.39 -10628.19 -13.97
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 83/101
83ARYANS SCHOOL OF MANAGEMENT
OPERATING RESULT
Particular 2008-09 2007-08 2006-07 2005-06 2004-05
Sales including services 51458 26626 56585 48737 3734
Accr. To stock -1834 576 -1303 -1154 -1893
Value of production 49624 27202 55282 47583 35241
Other income 481 2007 3292 5298 787
Direct materials 45532 28709 52597 43837 34954
S charge on inst. & maint.
Of exch.
2338 1777 150 34 41
Employ costs 8170 7446 6933 5021 4941
Depreciation 819 885 951 927 697
Financing expenses 5165 5268 5000 5815 3357
Other expenses 9456 3769 4958 6034 4775
Profit for the year -21375 -18645 -12015 -8787 -12737
Prior period adjustment -20 -3649 -2297 65 0
Profit before tax -21395 -22294 -14312 -8722 -12737
Provision for tax NA NA NA NA NA
Transfer for general res. NA NA NA NA NA
Profit after tax -21395 -22294 -14312 -8722 -12737
dividend - - - - -
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 84/101
84ARYANS SCHOOL OF MANAGEMENT
FINANCING POSITION
Particular 2008-09 2007-08 2006-07 2005-06 2004-05Equity
Reserve & surplus 29258 31023 32836 35158 3413
Misc. expend. Not w. Off 0 0 0 -116 -390
Net worth 29258 31023 32836 35042 3023
Bonds - - - - -
Other borrowing &
deferred charge
-38024 19777 -3622 -3568 25709
Gross block 57468 56655 56532 56390 23733
Depreciation 25795 23517 21160 18242 17335
Net block 31673 33138 35372 38148 6398Capital work in progress 83 79 142 130 114
Current assets & liabilities
Inventory 12360 12774 15244 11734 11348
Debtors 89543 65165 25676 30489 42253
Others 13804 14997 15034 13073 10547
Total 115707 92936 55954 55296 64148
Current liability &
provision
156229 75353 62254 62100 41928
Working capital -40522 17583 -6300 -6804 22220
Capital emp. By source
Net worth 29258 31023 32836 35042 3023
Borrowings -38024 19777 -3622 -3568 25709
Total funds -8766 50800 29214 31474 28732
Capital emp. By
application
Net fixed assets 31673 33138 35372 38148 6398
Working capital -40522 17583 -6300 -6804 22220
Capital work in progress 83 79 142 130 114
Investment - - - - -Total application -8766 50800 29214 31474 39832
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 85/101
85ARYANS SCHOOL OF MANAGEMENT
PROFITABILITY RATIO
(RS.IN LACS)
Particular 2008-09 2007-08 2006-07 2005-06 2004-05Profit before Int. & Tax
to capital employed
N.A N.A N.A N.A N.A
Profit before Tax to sales& services
N.A N.A N.A N.A N.A
Profit after Tax to networth
N.A N.A N.A N.A N.A
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 86/101
86ARYANS SCHOOL OF MANAGEMENT
WORKING CAPITAL RATIO
(RS.IN LACS)
Particular 2008-09 2007-08 2006-07 2005-06 2004-05
Current ratio 0.71:1 1.23:1 0.90:1 0.89:1 1.53:1
W.C in no. of months of
value of production
9.80 7.76 -1.37 -1.72 7.57
Invent. in no. of months of value of production
2.99 5.64 3.31 2.96 3.86
Debtors in terms of month of sales & services
20.88 29.37 5.45 7.51 13.65
W.C to total capitalemployed (%)
462.26% 34.61% -21.57% -21.62% 77.34%
Cost of direct material to
value of production (%)
91.75% 105.54% 95.14% 92.13% 99.19%
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 87/101
87ARYANS SCHOOL OF MANAGEMENT
GROWTH RATIO
(RS.IN LACS)
Particular 2008-09 2007-08 2006-07 2005-06 2004-05
Annual growth in value
of production (%)82.43% -50.79% 16.18% 35.02% 142.36%
Annual growth in gross block
-1.44% 0.22% 0.25% 137.60% 15.14%
Other statistics 3362 -2232 1982 3032 -385
Value added 1965 1986 2020 2078 2099
No. of employee at 31st
march
1071 -1.12 0.93 1.46 0.19
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 88/101
88ARYANS SCHOOL OF MANAGEMENT
WORKING CAPITAL STATEMENT
Particular 2008-09 2007-08 2006-07 2005-06 2004-05
Raw material & production
store
3529.33 5461.71 7075.20 4978.69 3958.92
WIP 1592.51 2801.07 3022.66 4192.75 4352.50
Finished goods 1122.53 1557.08 876.82 928.98 1852.60
Other 6115.43 2954.24 468.85 1633.55 1183.63
Total 12359.8 12774.1 15243.53 11733.97 11347.65
Value of production 49624.0 27202.0 56282.0 47583.0 35241.0Value of dispatch 51458.0 26626.0 56585.0 48737.0 37134.0
Inventory in term of months of
Value of production
2.99 5.64 3.31 2.96 3.86
Sundry debtors 89543.0 65165.0 25676.0 30489.0 42253.0
Working capital -40521.0 17583.0 -6300.0 -6804.0 22220.0
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 89/101
89ARYANS SCHOOL OF MANAGEMENT
COMPARISON OF SALES AND WORKING CAPITAL
(RS.IN LACS)
Year Sale Working capital
2004-05 37134 22220
2005-06 48737 6804
2006-07 56585 6300
2007-08 26626 17583
2008-09 51458 40522
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 90/101
90ARYANS SCHOOL OF MANAGEMENT
WORKING CAPITAL ANALYSIS
-50000
-40000
-30000
-20000
-10000
0
10000
20000
30000
2004-05 2005-06 2006-07 2007-08 2008-09
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 91/101
91ARYANS SCHOOL OF MANAGEMENT
SALES ANALYSIS
0
10000
20000
30000
40000
50000
60000
2004-05 2005-06 2006-07 2007-08 2008-09
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 92/101
92ARYANS SCHOOL OF MANAGEMENT
COMPARISON OF SALES AND WORKING CAPITAL
37134
48737
56585
26626
51458
22220
6804 6300
17583
40522
0
10000
20000
30000
40000
50000
60000
2004-05 2005-06 2006-07 2007-08 2008-09
sales
¥
¦
rki§
g ca
ital
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 93/101
93ARYANS SCHOOL OF MANAGEMENT
PROFITABILITY ANALYSIS
-25000
-20000
-15000
-10000
-5000
0
2004-05 2005-06 2006-07 2007-08 2008-09
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 94/101
94ARYANS SCHOOL OF MANAGEMENT
PRODUCTIVITY OF CAPITAL
Year Total capital
employed (in
Cr.)
PBT with cash &
non cash cost
(inCr.)
Return on capital PBT
all cash & non cash cost
(inCr.)
1997-98 304.67 134.53 44.16
1998-99 318.18 119.74 37.63
1999-00 335.43 93.67 27.93
2000-01 350.31 46.88 13.93
2001-02 397.53 52.51 13.21
2002-03 414.30 52.77 12.74
2003-04 296.00 82.82 27.982004-05 287.32 86.83 30.22
2005-06 314.74 19.80 6.29
2006-07 292.14 83.61 28.62
2007-08 508.00 161.41 31.77
2008-09 876.60 N.A N.A
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 95/101
95ARYANS SCHOOL OF MANAGEMENT
PRODUCTIVITY OF MATERIAL
Year Product value
(in cr.)
Raw material &
component (in
cr.)
Material
consumption
w.r.t production
(%)
1998-99 338.76 146.33 43
1999-00 357.65 156.92 44
2000-01 416.04 257.02 62
2001-02 497.77 348.36 70
2002-03 448.98 404.22 9 02003-04 145.41 164.35 113
2004-05 352.41 349.54 99
2005-06 475.83 438.37 92
2006-07 552.83 525.97 9 5
2007-08 272.02 287.09 105 .54
2008-09 496.24 455.32 91.75
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 96/101
96ARYANS SCHOOL OF MANAGEMENT
PRODUCTION ANALYSIS
0
10000
20000
30000
40000
50000
60000
2004-05 2005-06 2006-07 2007-08 2008-09
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 97/101
97ARYANS SCHOOL OF MANAGEMENT
HOW MONEY WAS UTILISED
VALUE IN %
Direct©
aterial
e ployee cost
financing expenses
epriciation
other expenses
profit
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 98/101
98ARYANS SCHOOL OF MANAGEMENT
SWOT ANALYSIS
STRENGTH
y Organization name.
y Dedicated & devoted employees.
y Collaboration with FRENCH company.
y Niche player in the field of electric and banking automatic in India.
WEAKNESS
y ITI has limited customers.y No advertisement.
y No promotional activities at any level.
y Delay in purchase & distribution of goods.
y Govt. rule & regulation.
y Less incentive is given to the employees
OPPORTUNITY
y It can grab the whole market of telecom.y It can enter in other area of telecom.
y Make collaboration with other international.
THREAT
y Several companies have entered into banking automation sector with
heavy sales promotional schemes.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 99/101
99ARYANS SCHOOL OF MANAGEMENT
FACTS AND FINDING
After undergoing industrial training in ITI limited, I got a lot of knowledge &
practical experience and also I came a across some problem and their causes
which are as follows:
PROBLEMS
y Company takes a lot of time for dispatching the goods.
y Limited customers
y Limited exports
y Company doesnt possess a proper a budgeting & monitoring system
y Trading has increase whereas manufacturing has decrease which
resulted in decreased in contribution with relation to fixed assets; the
company has to incur losses.
CAUSES
y Lack of proper management of inventory i.e. inventory log period is
higher.
y Lack of proper distribution network.
y Low efficient work place.
y Obsolete technology.
y Fierce completion with global market.
y Intervention of govt. policy & norms.
y Company does not possess proper strategies, proper budgeting &
monitoring system
ECOMMENDATION
y Implementation of innovative in the company.
y Proper inventory mgmt. should be followed.
y Dedicated R&D people are needed.
y Motivational classes should be arranged for the employees. \
y Proper training process is needed.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 100/101
100ARYANS SCHOOL OF MANAGEMENT
y Internal transfer of the employees is needed.
y Optimum utilization of existing infrastructure and resources.
y Sale of machine & scraps.
y Adopt customer retention policies.
8/9/2019 vaishnav pro............. (3)
http://slidepdf.com/reader/full/vaishnav-pro-3 101/101
BIBLIOGRAPHY
y Financial management --- I M PANDEY
y Financial management ---RAVI M KISHORE
Top Related