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INTRODUCTION TO THE STUDY: Financial management is a service activity which is concerned with providing quantitative information which is of financial nature which may be needed for making Economic decisions regarding the choice among alternative course of actions The financial management is a process of identification accumulation; analysis preparation interpretation and communication of financial information to plan evaluate and control a business firm. Financial management is that specialized function of general management which is related to the procurement of finance and its effective utilization for the achievement of the goals of an organization. Finance may be defined as the provision of money at the time where, it is required. Finance refers to the management flews of money through an organization. It concerns with the application of skills in the manipulation, use and control of money. Different authorities have interpreted the term “finance “differently. However there are three main approaches to finance. The first approach views finance as to providing of funds needed by a business on most suitable terms this approach confines fiancés to the raising of funds and to the study of financial institutions & instruments from where funds can be procured. The second approach relates fiancé to cash.
According to this concept. Fixed assets are acquired for use in the business for earning revenues so they are shown at their book values and at their current realizable values. While they do furnish useful financial data regarding its operations. This concept does not mean that the fixed asset will always be shown at cost but it means that cost becomes basis for all future Accounting for the fixed asset. Asset is recorded at cost at the time of its purchase but is systematically reduced in its value by charging depreciation. and theft deterrence. Fixed assets. The market value of a fixed asset may change with the passage of time. but for accounting purpose it continues to be shown in the books at its book value.. is a term used in accounting for assets and property which cannot easily be converted into cash. also known as a non-current asset or as property. the cost at which it was purchased minus depreciation provided up-to-date.e. preventive maintenance. a fixed asset is recorded in the books at the price paid to acquire it and that this cost is the basis for all subsequent accounting for the asset. closely related to the going concern concept. plant. The third approach views fiancé is being concerned with raising funds & their effective utilization. current realizable value of fixed assets become relevant. A fundamental concept of accounting. i. a serious limitation of these statements is that they do not provide information regarding changes in the firm’s financial position during a particular period of time. and equipment (PP&E). Fixed assets management is an accounting process that seeks to track fixed assets for the purposes of financial accounting. This can be compared with current assets such as cash or bank . The Fixed Assets Management is the Traditional Financial Statement of a business enterprise. is cost concept of accounting. But when the business unit is not a going concern and is to be liquidated.
office equipment. etc. motor vehicles used to transport deliveries. In most cases. cash held in the bank. As an example. and plant and machinery. It is pertinent to note that the cost of a fixed asset is its purchase price. motor vehicles. The primary objective of a business entity is to make profit and increase the wealth of its owners. In addition. cash registers used to handle cash payments. Moreover. etc.accounts. fixtures and fittings. flour. fixed assets normally include items such as land and buildings. computers. only tangible assets are referred to as fixed. which are described as liquid assets. Each aforementioned non-current asset is not sold directly to consumers. Its non-current assets would be the oven used to bake bread. These often receive favorable tax treatment (depreciation allowance) over shortterm assets.). yeast. the value of sales owed to the firm via credit (i. whose cost can be measured reliably. cost attributable to bringing and installing the asset in its needed location and the initial estimate of dismantling and removing the item if they are eventually no longer needed on the location. Fixed Assets are assets whose future economic benefit is probable to flow into the entity. debtors or accounts receivable).e. In the attainment of this objective it is required that the management will exercise due care and diligence in applying the basic accounting concept of “Matching Concept”. These are items of value which the organization has bought and will use for an extended period of time. including import duties and other deductible trade discounts and rebates. . a fixed/non-current asset can also be defined as an asset not directly sold to a firm's consumers/end-users. furniture. etc. According to International Accounting Standard (IAS) 16. a baking firm's current assets would be its inventory (in this case.
The idle of fixed assets lead a tremendous in financial cost and intangible cost associate to it. So chose a study to conduct on the fixed assets analysis of LG ELECTRONICS . So there needs lead a tremendous in financial cost and intangible cost associate to it. It is therefore obligatory that in order to accurately determine the net income or profit for a period depreciation is charged on the total value of asset that contributed to the revenue for the period in consideration and charge against the same revenue of the same period.that is long term.Matching concept is simply matching the expenses of a period against the revenues of the same period. This is essential in the prudent reporting of the net revenue for the entity in the period. So ration contributes very much in analyzing and utilized properly it effects long term sustainability of the firms in analyzing and utilized properly it affect long term sustainability of the firms which may affect liquidity and solvency and profitability positions of the company. Theses fixed assets are not convertible or not liquid able over a period of time the total owner finds and long term liabilities are invested in fixed assets. The study invents valuation of fixed assets in LG ELECTRONICS INDIA PVT LTD. The use of assets in the generation of revenue is usually more than a year. Since fixed assets playing dominant role in total business the firms has realized the effective utilization of fixed assets. NEED FOR STUDY: Fixed Assets play very important role in realign company’s objectives the firms to which capital investment vested on fixed assets. Valuation of fixed assets is important in order to have fair measure of profit or loss and financial position of the concern. So there is need for the companies to evaluate fixed assets performance analysis time to time by comparing with pervious performance comparison with similar company and comparison with industry standards.
Ltd. The study is conducted to offer suggestions for better utilization of Fixed Assets in LG Electronics India Pvt. The study is conducted to evaluate the fixed assets turnover on LG Electronics India Pvt. 2. corporate marketing and financial matters. Primary Data: .. Ltd. the title of the project is analysis on Fixed Assets management. Using ratio in comparison with previous year performance. drawn from annual report of the company.. The subject matter is limited to fixed assets it analysis and its performance but not any other areas of accounting. Ltd. 3. Ltd.INDIA PVT LTD. The study is conducted to evaluate depreciation and method of depreciation adopted by LG Electronics India Pvt. 4. Ltd. analyze the fixed assets by using the ratios in LG Sources of Data: For the study of the fixed asset management the data will be collected through different methods that are both primary and secondary data. The study is conducted to known the amount of finance made by long term liabilities and owner funds towards fixed assets. The fixed assets considered in the project is which cam not be converted into cash with one year. The study is conducted to Electronics India Pvt. Ltd. OBJECTIVES OF THE STUDY: 1. Ratio analysis is used for evaluating fixed assets performance of LG Electronics India Pvt. SCOPE OF STUDY: The project is covered of fixed Assets of LG Electronics India Pvt. 5.
Hyderabad Only. The theoretical content is gathered form eminent text book reference and library at LG Electronics India Pvt. Trend analysis and Ratio analysis are the techniques used for calculation purpose.The primary data will be collected mainly with interactions and discussions with the company’s executives. The data used for analysis and interpretation from annual reports of the company that is secondary forms of data. For this purpose of the study the recent five years period (2005-2006 to 2010-2011) is selected. Interpretation. The project is presented by using tables. Ltd. Secondary Data: The Secondary data gathering method is adopted purely form secondary sources. METHODOLOGY: The present study confines to the evaluation of overall financial performance of LG Electronics. graphs and with their interpretations. . The study is restricted to LG Electronics India Pvt.. Ltd. The financial data and information is gathered from annual reports of the company internal records. Conclusions and suggestions are purely base on my opinion and suggestions provided by the project guide.
Bibliography . CHAPTERISATION: CHAPTER I : CHAPTER II: CHAPTER III: CHAPTER IV: CHAPTER V: Introduction to the study Theoretical Frame work of Fixed Asset Management Organization Profile of LG Electronics India Pvt. Data Analysis and Interpretation Findings and Suggestions Annexure. Ltd. For the study the data will be collected from 2005 to 2011.PERIOD OF THE STUDY: The period of the study will be restricted to 5 years.
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