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ORIGIN's success has been as much a result of our dedicated team,
as our focus on quality and customer satisfaction. As part of our continual
effort to improve quality and put efficient internal processes in place, we
have also secured the ISO 9001 : 2000 certification.
LEASING THERE COMPUTER
TIE UP WITH COMPUTER COMPANY
We believe that any job can be fun if you have the opportunity to
use your insight and intelligence to improve a task or process.
PRIMARY OBJECTIVE :
SECONDARY OBJECTIVE :
INTRODUCTION
These real world facts introduce problems and require the necessity
of working capital. The most important areas in the day to day
management of the firm, is the management of working capital. Working
capital management is the functional area of finance that covers all the
current accounts of the firm. It is concerned with management of the level
of individual current assets as well as the management of total working
capital. Working capital management involves the relationship between a
firm's short-term assets and its short-term liabilities. The goal of working
capital management is to ensure that a firm is able to continue its
operations and that it has sufficient ability to satisfy both maturing short-
term debt and upcoming operational expenses. The management of
working capital involves managing inventories, accounts receivable and
payable, and cash.
In most of the organizations the first & second one which refers to
Capital Budgeting and Capital Structure respectively will be maintained
and cope up with organization growth. The third one which refers to
Working Capital Management requires more skills for sustaining and
steady growth rate for any organization.
iv. How much the firm should enjoy credit from its
suppliers
ii. To manage the current assets in such a way that the marginal
return on investment in these assets is not less than the cost
of capital acquired to finance them. This will ensure the
maximization of the value of the business unit.
Any amount over and above the permanent level of working capital
is variable, temporary or fluctuating working capital. This type of
working capital is generally financed from short term sources of finance
such as bank credit because this amount is not permanently required and
is usually paid back during off season or after the contingency. As the
name implies, the level of fluctuating working capital keeps on
fluctuating depending on the needs of the unit unlike the permanent
working capital which remains constant over a period of time.
b. Production Cycle
c. Business Cycle
d. Production Policy
e. Credit Policy
h. Profit level
i. Inflation
j. Operating Efficiency
6. ESTIMATING OF WORKING CAPITAL REQUIREMENTS
Percent Sales method is the most simple and widely used method
in combination with other scientific methods. A ratio is determined for
estimating the future working capital requirements. This is generally
based on the past experience of the management as this ratio varies from
industry to industry and unit to unit with in the same industry.
SPECULATION:
PRECAUTION:
TRANSACTION:
a. Trade Credits
b. Bank Credit
DEFINITION:
Working capital
Temporary or
Permanent or Fixed
Variable
Seasona
Regular Reserve Special
l
SOURCES OF WORKING CAPITAL:
Commercial banks,
Sources of working
Shares, capital
Indigenous
bankers,
Temporary or
Debentures, or Fixed
Permanent Variable
Trade
Public Deposits, creditors,
Institution.
Accounts
receivables
Credit.
Inventory of raw-material stores and spares.
Inventory of finished goods.
CURRENT ASSETS:
• Temporary investments
• Short term advances
• Prepaid expenses
• Receivables
CURRENT LIABILITIES:
• Outstanding expenses,
CASH CYCLE:
Cash
Materials, Labor
Receivables Expenses
Work-in-
Sales Progress
Finished
Goods
ADVANTAGES:
4. Seasonal fluctuations,
5. Fluctuations in supply,
7. Terms of sales,
8. Terms of purchase,
16. Time,
22. Inflation,
RESEARCH DESIGN:
RESEARCH TYPE:
DESCRIPTIVE RESEARCH:
SECONDARY DATA:
The rest of the data is collected from the annual report brochures
and websites of the organization.
ANALYSIS TOOLS:
Ratio analysis,
The executive being busy with their yearly audit works. Therefore,
they could not able to devote sufficient time..
Time is the major constraint for this study. The study cannot be
finished with in the stipulated period allowed.
85715065
90000000
80000000
70000000
60000000
50000000
40000000
30000000 17294097
14201468
20000000 10367036
10000000
0
2006-07 2005-06 2004-05 2003-04
DEBTOR COLLECTION PERIOD
During 2004 sales was Rs. 1.156 it has been gradually increased to
Rs. 1.1970 in 2007.
109940267
120000000
100000000
80000000
60000000
40000000
18689046 15060677 16217174
20000000
0
2006-07 2005-06 2004-05 2003-04
DEBTOR TURNOVER RATIO
1.156
2003-04
2.212
2004-05
4.41
2005-06
1.97
2006-07
8583433
13029571
19615613
109569181
CREDITOR PAYMENT PERIOD:
During 2004 the amount has been paid to creditors in 3.28 days but
it has been decreased to 2.95 days during 2006
CHART 5.1.5: CREDITOR COLLECTION PERIOD
3.65
2003-04
3.442
2004-05
4.061
2005-06
1.891
2006-07
191624
2003-04
550759.5
2004-05
1063751.5
2005-06
10459536
2006-07
350
303.1
300
250
200 153.89
134.57
150
100
25.129
50
0
2006-07 2005-06 2004-05 2003-04
FINISHED GOODS TURNOVER RATIO
19667396
20000000
18000000
16000000
14000000
12000000
10000000
8000000
6000000
4000000
1251675 875828
2000000 225691
0
2006-07 2005-06 2004-05 2003-04
FINISHED GOODS STORAGE PERIOD
Firms produce goods in order to sell them in the market. There may
be a delay in them sales or in meeting seasonal demand for finished
goods.
During 200 the amount has been collected from inventory in 1.44
days but it has been increased to 27.3 days during 2006
114.37
257.35
96.77
CURRENT RATIO
250000000
202635677
200000000
150000000
100000000
40522249
25267333 24230239
50000000
0
2006-07 2005-06 2004-05 2003-04
LIQUID RATIO
During 2004 quick asset was Rs. 2.4 it has been gradually
decreased to Rs. 1.56 in 2007.
2003-04 24004548
2004-05 24391505
2005-06 39270574
182968281
2006-07
CURRENT ASSETS:
Inventories 19667396 1251675
Sundry debtors 109940267 18689046
Cash & bank 63426 117311
Deposit, loan 72941555 20319655
Total(A) 202612644 208578787
CURRENT LIABILITIES:
Current liabilities 109569181 19615613
Provision 7351430 3612539
Increase in working
99598602
capital
185290635 185290635
SCHEDULE OF CHANGES IN WORKING
CAPITAL AS ON 31.3.2004
Particulars 2004 2005
(Rs. In crores) (Rs. In crores)
CURRENT ASSETS:
Inventories 875828 225691
Sundry debtors 15060677 16217174
Cash & bank 58640 23719
Deposit, loan 6817322 6336002
Bank account 26911 16000
TDS at sources 2427955 1411653
CURRENT LIABILITIES:
Sundry creditor 13029571 8583433
provision 1870726 1445338
Increase in working
capital 3834432
185290635 185290635
FINDINGS
• During 2004 cost of goods sold was Rs. 58082829it has been
gradually decreased to Rs. 262844360 in 2007 in finished
turnover period.
• During 200 the amount has been collected from inventory in
1.44 days but it has been increased to 27.3 days during
2006 in finished goods storage period.
• During 2004 quick asset was Rs. 2.4 it has been gradually
decreased to Rs. 1.56 in 2007 in liquid ratio.
SUGGESTION & RECOMMENDATIONS
The working capital was decreasing year by year and collection
period is reducing. The company as to maintain some ratio and collection
period in the year in future year. It observed that finished goods working
capital utilization is decreasing year after year. It increasing market share
and profitability of the company in the future year.
WEBSITE:
WWW.GOOGLE.COM
WWW.WIKEPADIA.COM
WWW.ORIGININFOSYS.COM
“A STUDY ON WORKING CAPITAL MANAGEMENT
OF ORIGIN INFOSYS PRIVATE LIMITED”
Undertaken at
ORIGIN INFOSYS LTD.
CHENNAI
Submitted by
V.SHYAM SUNDAR
(Reg. No. 10607631051)
of
JAYA ENGINEERING COLLEGE
In partial fulfillment for award of the degree
of
JULY -2008
DECLARATION
SHYAM SUNDAR.V
BONAFIDE CERTIFICATE
reported herein does not form part of any other project or dissertation on
SIGNATURE SIGNATURE
Last but not least, I would like to thank all the respondents.
Company staffs and friends who have directly and indirectly helped me to
complete this project.
ABSTRACT
This project was undertaken with a view of study the impact of
working capital management origin Infosys private limited.
The study was conducted for a period of one months. The research
design used in this study is case study method. The research design used
in this study of interim reports.
The analysis has been carried based on the secondary data and will
be displayed in tables and charts. This tables and charts help the
researcher for findings of the study.
ABSTRACT
LIST OF TABLES
LIST OF FIGURES
1. GENERAL INTRODUCTION 1
3. REVIEW OF LITERATURE 9
4. RESEARCH METHODOLOGY
6. FINDINGS 45-46
8. CONCLUSION 48
APPENDICIES
BIBLIOGRAPHY
LIST OF TABLES