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A Study On Working Capital Managementin Cooper Bussmann India Private Limited Puducherry
A Study On Working Capital Managementin Cooper Bussmann India Private Limited Puducherry
BONAFIDE CERTIFICATE
This to certify that the project work entitled A STUDY ABOUT WORKING
CAPTIAL MANAGEMENT IN COOPER BUSSMANN INDIA PRIVATE
LIMITD is a bonafide work done by S.RAJAN [ REGISTER NO: 27348330 ] in
partial fulfillment of the requirement for the award of Master of Business Administration
by Pondicherry University during the academic year 2006 2008.
GUIDE
EXTERNAL EXAMINER
HEAD OF DEPARTMENT
ACKNOWLEDGEMENT
First and foremost, I thank the God for his substantial blessing and mercy at all
stages in the completion of the project.
I take this opportunity to express my deep sense of gratitude to
SHRI.N.KESAVAN, Founder Chairman, SHRI.M.DHANASEKARAN, Managing
Director and SHRI.S.V.SUGUMARAN, Vice-Chairman of our college for their good
wishes for this project.
I
express
my
immense
gratitude
to
my
Principal
extend
the
immense
gratitude
to
the
Head
of
the
Department
valuable
and
unflinching
requital
support
in
this
Endeavor
ABSTRACT
The Project has been done in Cooper Bussmann India Private Limited,
Puducherry. The title of the project is A Study on the Working Capital Management in
Cooper Bussmann India Private Limited.
The study starts with an Companys profile and also the need for study, review of
literature and objectives are set out for the study. Research methodology, Data analysis &
Interpretation, Findings and Suggestions of the study follow.
One of the main areas of the project is the analysis part, where the data are
analyzed & interpreted, to find out the working capital. Some of the tools used in
working capital are regarding to:
Ratio Analysis
Comparative Financial Statements.
Trend Analysis.
And then conclusions, limitations & scope for further study were discussed.
CONTENTS
CHAPTER
TITLES
PAGE NO.
LIST OF TABLES
LIST OF CHARTS
INTRODUCTION
II
REVIEW OF LITERATURE
III
14
IV
RESEARCH METHODOLOGY
15
16
VI
VII
VIII
CONCLUSION
46
47
48
LIST OF TABLES
49
50
51
Table. no
5.1
5.2
5.3
5.4
5.5
5.6
5.7
5.8
5.9
5.10
5.11
5.12
5.13
5.14
5.15
5.16
5.17
5.18
5.19
Name of Tables
Current ratio
Working Capital turnover ratio
Inventories to current assets
Cash to Current assets ratio
Cash to Working capital ratio
Cash to sales ratio
Cash ratio
Current assets to Fixed assets ratio
Current assets to Total assets ratio
Working Capital ratio
Inventories
Cash/Bank
Receivable
Current liabilities
Bills payable
Comparative balance sheet (2000&2001)
Comparative balance sheet (2001&2002)
Comparative balance sheet (2002 & 2003)
Comparative balance sheet (2002 &2003)
Page. no
16
18
20
22
24
26
28
30
32
34
36
37
38
39
40
42
43
44
45
LIST OF CHARTS
Table. no
5.1
5.2
5.3
5.4
5.5
5.6
5.7
5.8
Name of Charts
Current ratio
Working Capital turnover ratio
Inventories to current assets
Cash to Current assets ratio
Cash to Working capital ratio
Cash to sales ratio
Cash ratio
Current assets to Fixed assets ratio
Page. no
17
19
21
23
25
27
29
31
5.9
33
CHAPTER I
INTRODUCTION
COMPANY PROFILE
COOPER BUSSMANN INDIA PRIVATE LIMITED
BACKGROUND COOPER INDUSTRIES
Cooper Industries having their manufacturing excellence and market leading
product. Initially started with a small iron foundry in Ohio, US, Cooper has grown world
wide, diversified over 100 manufacturing bases spread over five continents. The two
businesses segments namely electrical products and Tools & Hardware products are the
best known brands in their industries.
Cooper products known worldwide for its superior quality, reliability and
innovation. Their business divisions are Cooper lighting, Cooper Menvier, Cooper Power
Systems, Cooper Cruise-Hinds, Cooper Power Tools, Cooper Tools and Cooper
Bussmann.
COOPER BUSSMANN
Cooper Bussmann is one of the worlds largest producers of circuit protection and
power quality equipment manufacturing, a wide range of fuses to protect electrical,
electronic and automotive systems globally. It is one of the leading suppliers of circuit
protection Fuses and Gears in the world. Each product is backed by an efficient world
wide distribution network service and technical support. Bussmann circuit protection
solutions comply with the major international standards such as BS, IEC, DIN, and CSA
AND UL. Cooper Bussmann also offers inductors and transformers designed to provide
power quality in electronic applications. One of the principal factories is at Burton near
Leistershire in U.K.
Cooper Bussmann Inc, a company incorporated in the United States of America,
acquired 100% equity in M/s S&S Low Tension Switch Gear Limited vide approval of
Foreign Investment Promotion Board, for Direct Investment in India. The name of the
company was changed to Cooper Bussmann India Private Limited (CBIL).
This current limiting fuse range comply with DIN 43625 dimensional standards
and IEC 60282 electrical standards having a spring assisted striker mechanism for fail
indication. These are used for back up protection in an medium voltage circuit system.
MEDIUM VOLTAGE OIL FUSE RANGE:
This range of fuses complies with IEC 281 -1 electrical standards and BS 2692 -1
standard. These are designed or use in oil filled switchgear such as Ring main unit panels
used for ring main distribution system. These can be used inside oil filled transformer
tanks where high oil temperatures may be expected. The range planned to be
manufactured is from 7.2 KV to 12 KV covering a current rating of 10A to 140 A and
fitted with striker pin with unique triple seal system ensuring against long term seal
deterioration.
EUROPEAN DIN HIGH SPEED FUSE RANGE:
This range planned to be manufactured complies with DIN 43653 dimensional
standards IEC 60269-4 electrical standards and offered in various sizes from size 000 to
size 4. The immediate range covers the size 1* which has body cross section of 45
*45mm. these are used for protection of semiconductor devices which are sensitive to
over load surges. This fuse is used in majority of Industrial Rectifiers, Rolling stock
rectifiers, Industrial DC and AC drives, AC controllers and many other power electronic
equipments. Bussmann square body fuses are a very attractive solution for high
applications which require a compact design with superior performance.
MARKET
Cooper Bussmann India Private Limited has a large network of distributors and
stockiest for its products:
-
North America
Europe
Middle East
Far East
Australia
The products are being marketed and sales are supported by selling team in all the
above areas.
CHAPTER II
REVIEW OF LITERATURE
Working capital management involves the relationship between a firm's shortterm 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.
Decisions relating to working capital and short term financing are referred to as
working capital management. These involve managing the relationship between a firm's
short-term assets and its short-term liabilities. The goal of Working capital management
is to ensure that the firm is able to continue its operations and that it has sufficient cash
flow to satisfy both maturing short-term debt and upcoming operational expenses.
By definition, Working capital management entails short term decisions generally, relating to the next one year period - which are "reversible". These decisions
are therefore not taken on the same basis as Capital Investment Decisions (NPV or
related, as above) rather they will be based on cash flows and / or profitability.
The importance of cash flow is not new to the finance literature. Over twenty
years ago, Largay and Stickney (1980) reported that the then-recent bankruptcy of W.T.
Grant, a nationwide chain of department stores, should have been anticipated because the
corporation had been running a deficit cash flow from operations for 8 of the last 10 years
of its corporate life. As part of a study of the Fortune 500s financial management
practices, Gilbert and Reichert (1995) find that time value of money cash flow analysis is
used to select projects in 91 percent of the firms. Accounts receivable management
models are used in 59 percent of these firms, while inventory management models were
used in 60 percent of the companies.
Recently, Farragher, Kleiman and Sahu (1999) find that 55 percent of firms in the
S&P Industrial index complete some form of a cash flow assessment, but did not present
insights regarding accounts receivable and inventory management, or variations of any
current account asset or liability accounts across industries.
capital benchmarks for public companies using data for 1996. Each company is ranked
against its peers and also against the entire field of 1000 companies. rel continues to
update the original information on an annual basis. The industries that include at least 8
companies over the 1996-2000 periods are listed below. Deleted: represented.
Inventory
CURRENT LIABILITIES:
Bank Overdraft
Ratio analysis can be used to monitor overall trends in working capital and to
identify areas requiring closer management.
When considering these techniques and strategies, departments need to recognize that
each department has a unique mix of working capital components. The emphasis that
needs to be placed on each component varies according to department. For example,
some departments have significant inventory levels; others have little if any inventory.
Furthermore, working capital management is not an end in itself. It is an integral part
of the department's overall management. The needs of efficient working capital
management must be considered in relation to other aspects of the department's financial
and non-financial performance.
Financial ratio analysis calculates and compares various ratios of amounts and
balances taken from the financial statements.
Three key points need to be taken into account when analyzing financial ratios:
However, financial ratio analysis is valuable because it raises questions and indicates
directions for more detailed investigation.
The following ratios are of interest to those managing working capital:
stock turnover;
debtors ratio;
creditors ratio.
The working capital ratio (or current ratio) attempts to measure the level of
liquidity, that is, the level of safety provided by the excess of current assets over current
liabilities.
The "quick ratio" a derivative, excludes inventories from the current assets,
considering only those assets most swiftly realizable. There are also other possible
refinements.
There is no particular benchmark value or range that can be recommended as
suitable for all government departments. However, if a department tracks its own
working capital ratio over a period of time, the trends-the way in which the liquidity is
changing-will become apparent.
LIQUID INTERVAL RATIO
Liquid Assets
Average Operating Expenses
This is another measure of liquidity. It looks at the number of days that liquid
assets (for example, inventory) could service daily operating expenses (including
salaries).
STOCK TURNOVER RATIO
Cost of Sales
Average Stock Level
This ratio applies only to finished goods. It indicates the speed with which
inventory is sold-or, to look at it from the other angle, how long inventory items remain
on the shelves. It can be used for the inventory balance as a whole, for classes of
inventory, or for individual inventory items.
The figure produced by the stock turnover ratio is not important in itself, but the
trend over time is a good indicator of the validity of changes in inventory policies.
In general, a higher turnover ratio indicates that a lower level of investment is
required to serve the department.
Most departments do not hold significant inventories of finished goods, so this
ratio will have only limited relevance.
DEBTOR RATIO
There is a close relationship between debtors and credit sales to third parties (that
is, sales other than to the Crown). If sales increase, debtors will increase, and conversely,
if sales decrease debtors will decrease.
The best way to explain this relationship is to express it as the number of days that
credit sales are carried on the books:
Credit sales per period x days per period
Average Debtors
Where trading terms are 30 days net cash, and customers buy from day-to-day
during the 30 day period and pay 30 days after a statement is rendered, a collection
period of 45 days (the average between 30 and 60 days) would be satisfactory.
If the average collection period extends beyond 60 days, debtors are holding cash
that should have flowed into the department. This means that the department is unable to
satisfy pressing liabilities or to invest that cash.
The debtor ratio does not solve the collection problem, but it acts as an indicator
that an adverse trend is developing. Remedial action can then be instigated.
CREDITOR RATIO
This ratio is much the same as the debtor ratio. It expresses the relationship
between credit purchases and the liability to creditors. It can be stated as the number of
days that credit purchases are carried on the books.
Credit purchase per period x days per period
Average Creditors
CHAPTER III
OBJECTIVES OF THE STUDY
To know whether the company maintain a large size of inventory for efficient and
smooth production and sales operations.
To find whether there is proper match between current assets and current
liabilities.
CHAPTER IV
RESEARCH METHODOLOGY
RESEARCH DESIGN
A research design is the arrangement of conditions for collection and analysis of
data in a manner that aims to combine relevance to the research purpose with economy in
procedure.
The formidable problem that follows the task of defining the research problem is
the preparation of the design of the research project, popularly known as the research
design. Decisions regarding what, where, when, how much, by what means concerning
an inquiry or a research study constitute a research design.
DATA COLLECTION
SECONDARY DATA
Secondary data means that are already available i.e. they refer to the data which
have already been collected and analyzed by someone else. Secondary data may either be
published data or unpublished data. Usually published data are available in various
publications of the central, state, local governments. Also in technical and trade journals,
books, magazines and newspapers, reports and publications of various associations
connected with business and industry, banks, stock exchanges reports prepared by
research scholars universities in different fields
This study is period for the annual reports and statements of accounts extended
from the years
ANALYTICAL TOOL FOR THE STUDY
During the course of research for the researcher for analysis and interpretation o
data is given below has applied various tools.
Ratios analysis
Trend analysis
CHAPTER V
DATA ANALYSIS AND INTERPRETATION
LIQUIDITY OF WORKING CAPITAL:
The liquidity position of a firm is largely affected by the liquidity of its
working capital. The appropriate tests of this important feature of working capital
analysis are analysed below.
5.1CURRENT RATIO
YEAR
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
Inference:
CURRENT
CURRENT
ASSETS
LIABILITIES
1259369408
1607087538
857669926
1135662118
1049098939
221154699
184830664
120407697
112919857
220779845
RATIO
( Times )
5.69
8.69
7.12
10.05
4.75
YEAR
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
WORKING
RATIO
SALES
CAPITAL
( Times )
(Rupees)
(Rupees)
98492557
136214011
148087677
121535360
85410661
1038214709
241219109
1084194229
1022742261
828319091
0.09
0.56
0.14
0.12
0.10
Inference:
This ratio indicates whether working capital has been effectively utilized in
making sales or not.
From the table it is noted that working capital had some fluctuation in the middle
of the study period, yet the company was able to increase it in the later years.
Hence the turnover indicates that company had utilized its working capital
efficiently and the company can also try to work on this to get more effective values.
YEAR
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
CURRENT
RATIO
INVENTORIES
ASSETS
( Times )
(Rupees)
(Rupees)
443218275
4565366544
493646982
478946594
453879029
1259369408
1607087538
857669926
1135662118
1049098939
0.35
0.28
0.41
0.42
0.43
Inference:
From the table it is known that the inventories to current assets ratio also register
a fluctuating trend during the entire study period.
The average ratio is 0.41 times and thus it is found that the investment in
inventories is kept at the considerable level.
YEAR
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
CURRENT
RATIO
CASH
ASSETS
( Times )
(Rupees)
(Rupees)
472165527
357605655
521248923
306643076
241319457
1259369408
1607087538
857669926
1135662118
1049098939
0.37
0.22
0.43
0.27
0.23
Inference:
From the table shows the details of cash to current assets ratio and registered a
fluctuating trend throughout the study period from 1999 to 2004.
The average cash to current assets is maintained at proper times. Hence we find
that company had moderate level of cash in proportion to current assets.
YEAR
CASH
(Rupees)
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
472165527
357605655
521248923
306643076
241319457
WORKING
RATIO
CAPITAL
( Times )
(Rupees)
1038214709
241219109
1084194229
1022742261
828319091
0.45
0.15
0.48
0.29
0.29
Inference:
The cash to working capital ratio registered a fluctuating trend during the study
period this is noted from the table.
The average ratio of cash to working capital is balanced. Hence it is found that the
working capital ratio is managed by using the cash & bank balance available in the
company.
RATIO
YEAR
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
CASH
SALES
(Rupees)
(Rupees)
472165527
357605655
521248923
306643076
241319457
98492557
136214011
148087677
121535360
85410661
( Times )
4.79
2.62
3.52
2.52
2.82
Inference:
This is one of the important ratios of controlling cash. A study of cash to sales
ratio will provide a deep insight into the cash balance held in the concerns.
Evident from the table shows cash to sales registered a fluctuating trend
throughout the study period.
YEAR
CASH
(Rupees)
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
472165527
357605655
521248923
306643076
241319457
CURRENT
RATIO
LIABILITIES
( Times )
(Rupees)
221154699
184830664
120407697
112919857
220779845
2.14
1.93
4.33
2.71
10.9
Inference:
From the table it is noted that the cash position of the company is satisfactory as
the average ratio.
It is found that the cash required to meet out the current liabilities is maintained at
a normal level hence its shows that company follows an average policy.
CURRENT
FIXED
RATIO
YEAR
ASSETS
ASSETS
( Times )
(Rupees)
(Rupees)
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
1259369408
1607087538
857669926
1135662118
1049098939
445335336
445335336
298717767
477487671
468492769
2.83
3.61
4.03
2.20
2.42
Inference:
The level of current assets can be measured by using this current asset to fixed
assets ratio.
From the table it is noted that the ratio is between the average ratio and this
indicates the company had a moderate current asset policy throughout the study period.
YEAR
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
CURRENT
TOTAL
RATIO
ASSETS
ASSETS
( Times )
(Rupees)
(Rupees)
1259369408
1607087538
857669926
1135662118
1049098939
1941885379
1838866594
1878097191
1799527219
1711356105
0.65
0.87
0.64
0.63
0.61
Inference:
From the table shows the current assets to total assets ratio of the company, which
registered a fluctuating trend throughout the study period.
This ratio implies that company is maintaining a considerable level of current
assets in proportion to total assets.
WORKING
YEAR
1999-2000
2000-2001
2001-2002
2002-2003
2003-2004
CURRENT
RATIO
CAPITAL
ASSETS
( Times )
(Rupees)
(Rupees)
1038214709
241219109
1084194229
1022742261
828319091
1259369408
1607087538
857669926
1135662118
1049098939
0.82
0.15
0.90
0.90
0.78
Inference:
From the table working capital ratio registered a fluctuating trend during the
study period this is noted .
Hence it is found that the working capital ratio is managed by using the cash &
bank balance available in the company.
TREND ANALYSIS:
Y = a + bX
Where a = Y
n
b = XY
X2
Table 5.11
INVENTORIES
Inventories
YEAR
1999-00
-2
4
2000-01
-1
1
2001-02
0
0
2002-03
1
1
2003-04
2
4
TOTAL
5
10
(Source: Annual Report)
a
=
b
(Rs )
(Rs)
4,43,218,275
4,56,536,544
4,93,646,982
4,78,946,594
4,53,879,029
2,326,227,424
2,326,227,424
5
43,731,558
10
XY
=
=
-8,866,436,550
-4,56,536,544
0
4,78,946,594
9,07,758,058
43,731,558
4,65,245,484.8
4,373,155.8
Table 5.12
CASH / BANK
Cash / Bank
YEAR
1999-00
-2
4
2000-01
-1
1
2001-02
0
0
2002-03
1
1
2003-04
2
4
TOTAL
5
10
(Source: Annual Report)
20,92,339,562
5
(Rs )
XY
(Rs)
4,72,165,527 -9,44,331,054
3,57,605,655 -3,57,605,655
5,21,248,923
0
3,06,643,076 3,06,643,076
2,41,319,457 4,82,638,914
20,92,339,562 11,87,644,681
11,87,644,681
10
41,84,667,912.4
11,81,644,681
Table 5.13
RECEIVABLE
RECEIVABLE
YEAR
1999-00
-2
4
2000-01
-1
1
2001-02
0
0
2002-03
1
1
2003-04
2
4
TOTAL
28
(Source: Annual Report)
a
b
(Rs)
X2
XY
3,26,151,232
3,19,961,287
2,96,585,354
3,14,999,942
12,02,157,554
56,005.28
-65,23,622,464
-3,19,961,287
0
3,14,999,942
24,04,315,108
41,322.97
(Rs)
24,04,315,108 =
5
=
41,322.97
28
8000.75
=
1,475.82
Table 5.14
CURRENT LIABILITIES
YEAR
Current
Liabilities
XY
(Rs)
(Rs)
Y
1999-00
-2
4
2000-01
-1
1
2001-02
0
0
2002-03
1
1
2003-04
2
4
TOTAL
5
10
(Source: Annual Report)
a
b
=
=
8,60,092,765
5
40,52,660,509
10
2,21,154,699
1,84,830,664
1,20,407,697
1,12,919,857
2,20,779,848
8,60,092,765
=
=
-4,42,309,398
-1,84,830,664
0
1,12,919,857
4,41,559,696
-40,52,660,509
17,2018,553
4,05,266,050.9
Table 5.15
BILLS PAYABLE
X2
YEAR
1999-00
-2
2000-01
1
2001-02
0
2002-03
1
2003-04
2
TOTAL
5
(Source: Annual Report)
a
b
=
=
4
1
0
1
4
10
4,98,208,587
5
-2,288,993
10
BILLS
PAYABLE
(Rs )
Y
XY
(Rs )
56,677,194 -1,13,354,388
1,28,990,900 -1,28,990,900
14,045,050
0
1,04,122,991 1,04,122,991
67,966,652 1,35,933,304
4,98,208,587
-2,288,993
=
=
99,641,717.4
-228,899.3
FINANCIAL STATEMENTS:
The history of financial statement analysis is traced back to the beginning of 20th
century. The analysis was started in western countries for the use of credit analysis. Till
1914, financial institutions used to rely on the facts of financial statements. But over a
period of time, the need for analysis was felt and a number of techniques were invested
and made use of the purpose of analysis.
The important techniques of analysis and interpretation of financial statements are
listed below
a. Comparatives financial statement
b. Trend analysis
c. Ratio analysis
.
(a). COMPARATIVE FINANCIAL STATEMENT.
This is yet another technique used in financial statement analysis.
These
statements summaries and present related data for a number of years, incorporating there
in changes (absolute and relative) in individual items of financial statements. These
statements normally comprise comparative balance sheets, comparative statements of
change in total capital as well as in working capital.
They help in making interfered and inter firm comparisons and also highlights
the trends in perforanance effeminacy, and financial position.
Table 5.16
COMPARATIVE BALANCESHEET OF
THE COOPER BUSSMANN INDIA PRIVATE LIMITED
AS ON 31st MARCH (2000 AND 2001)
PARTICULARS
2000
(Rs)
2001
(Rs)
(+)
(or) (-)
In 2002 over 2001
Amount
percentage
ASSETS
CURRENT ASSETS
Stock
Deposits
Bill Receivable
Sundry debtors
Cash in hand
Cash at bank
TOTAL (A)
443218275
7498550
326151226
141649658
94433105
2,36082764
1249033578
456536544
9038550
319961287
136081699
90721130
12,39142039
1239142039
13318269
154000
-6189945
-5567959
-3711975
92799539
-9891539
3.00%
20.54%
-1.87%
-3.93%
-3.93%
-3.93%
-9.32%
445335336
445335336
445335336
445335336
1694368914
1684477369
-9891545
-5.837%
16069405
290514861
306584266
22107922
235280109
257388031
6038517
-55234.782
49196235
37.57%
-19.01%
-16.04%
277556924.6
763281556
356772334.5
856253602.8
155673887
41230204
56%
-5.40%
346946162
1694368914
214063400.7
1684477369
-58125822
-9891539
-16.75%
-5.83%
FIXED ASSETS
Fixed Assets
TOTAL (B)
TOTAL ASSETS
(A+B)
LIABILITIES:
CURRENTLIBILITY:
Sundry creditors
Bill Payable
TOTAL (C)
CAPITAL&RESERVE:
Capital
Profit & loss a/c
LONGTERM LOANS
Loans
TOTAL LIABILTIES
Table 5.17
COMPARATIVE BALANCESHEET OF
THE COOPER BUSSMAN INDIA PRIVATE LIMITED
AS ON 31st MARCH (2001 AND 2002)
PARTICULARS
2001
(Rs)
2002
(Rs)
(+)
(or) (-)
In 2002 over 2001
Amount
percentage
ASSETS
CURRENT ASSETS
Stock
Deposits
Bills Receivable
Sundry debtors
Cash in hand
Cash at bank
TOTAL (A)
456536544
9038550
319961281
136081699
90721130
226802829
1239142039
493646982
12580790
296585354
143439642
95626428
239066070
1280945266
+37110438
3542240
-23375933
+7357943
4905298
12623241
41802227
+8.12%
+39.10%
-7.30%
+5.40%
5.40%
5.40%
3.37%
445335336
445335336
447161879
447161879
1826543
1826543
+4.10%
+4.10%
1684477369
1728107145
43369736
+2.59%
Bills Payable
Sundry debtors
Provisions
235280109
22107922
-
145140974
443822569
153914443
-90139135
21714647
153914647
-38.31%
98.22%
100%
TOTAL
257388031
342877986
85489955
33.25%
356772334
856253602.8
207784373.9
900398953.5
-148987960
44145350.6
-41.75%
5.1%
Loans
214063400
277045831.7
62982431
29.42%
TOTAL LIABILITIES
168447369
1728107145
43629776
2.59%
FIXED ASSETS
Fixed Assets
TOTAL(B)
TOTAL ASSETS
(A+B)
LIABILITIES:
CURRENTLIBILITY:
CAPITAL&RESERVE:
Capital
Profit & loss a/c
LONGTERM LOANS
Table 5.18
COMPARATIVE BALANCESHEET OF
THE COOPER BUSSMAN INDIA PRIVATE LIMITED
AS ON 31st MARCH (2002 AND 2003)
PARTICULARS
2002
(Rs)
(+)
(or) (-)
In 2003 over 2002
Amount
percentage
2003
(Rs)
ASSETS
CURRENT ASSETS
Stock
Deposits
Bills Receivable
Sundry debtors
Cash in hand
Cash at bank
493646982
12580790
296585354
143439354
956626428
239066070
478946594
25871970
314999999
91998322
61332216
153330539
-14700388
13291180
18414645
-51441320
-34294212
-85735531
-2.97%
105.64%
6.20%
-35.82%
-33.83%
-32.86%
1280945266
1126479640
-154465626
-12.05%
447161879
447161879
468472769
468472769
21330890
21330890
4.77%
4.77%
1728107145
1594972409
-133134690
-12.05%
Sundry creditors
Provision
Bills Payable
43822569
145140974
51128387
68174856
128472622
7305818
68174856
-16668352
16.67%
100%
-11.48%
TOTAL
188963543
247775865
58839322
31.13%
769571780
461743068
353842850
1061528550
-415728930
599785482
-54.20%
129.89%
307828714
-307828714
-100%
1728107145
1594792409
-133314696
-7.71%
TOTAL (A)
FIXED ASSETS
Fixed Assets
TOTAL (B)
TOTAL ASSETS
(A+B)
LIABILITIES:
CURRENTLIBILITY:
CAPITAL&RESERVE:
Capital
Profit & loss a/c
LONGTERM LOANS
Loans
TOTAL LIABILITIES
Table 5.19
COMPARATIVE BALANCESHEET OF
THE AUROMODE & CO
AS ON 31st MARCH (2003 AND 2004)
PARTICULARS
2003
(Rs)
2004
(Rs)
(+)
(or)
(-)
In 2004 over 2003
Amount
percentage
ASSETS
CURRENT ASSETS
Stock
Deposits
Loans & Advances
Sundry debtors
Cash in hand
Cash at bank
TOTAL (A)
8,35,823.09
13,720.00
52,150.00
42,083.40
4,012.95
37,136.40
9,84,926.44
15,35,450.00
38,720.00
72,632.60
4,78,970.52
1,321.55
7,11,908.54
28,39,003.21
+6,99,626.31
+25,000.00
+20,482.60
+4,36,887.10
-2,691.40
+6,74,772.14
+18,54,076.77
+83.70%
+182.21%
+39.27
+1038.14%
-67.06%
+1817.01%
+188.24%
40,30,052.75
40,30,052.75
38,82,952.75
38,82,952.75
-1,47,100.00
-1,47,100.00
-3.65%
-3.65%
1,00,000.00
1,00,000.00
40,000.00
40,000.00
-60,000.00
-60,000.00
-60%
-60%
51,14,979.19
67,61,955.96
+16,46,976.77
+32.19%
Sundry creditors
Provision
4,07,343.50
1,00,350.00
10,91,486.72
1,94,241.00
+6,84,143.22
+93,891.00
+167.95%
+93.56%
TOTAL (D)
5,07,693.50
12,85,727.72
+7,78,034.22
+153.24%
45,07,285.69
45,07,285.69
44,17,978.24
44,17,978.24
-89,307.45
-89,307.45
-1.98%
-1.98%
1,00,000.00
1,00,000.00
10,58,250.00
10,58,250.00
+9,58,250.00
+9,58,250.00
+958.25%
+958.25%
51,14,979.19
67,61,955.96
+16,46,976.77
+32.19%
FIXED ASSETS
Fixed Assets
TOTAL (B)
INVESTMENT:
Investment
TOTAL
TOTAL ASSETS
(A+B+C)
LIABILITIES:
CURRENTLIBILITY:
CAPITAL&RESERVE:
Capital
Profit & loss a/c
TOTAL (E)
LONGTERM LOANS
Loans
TOTAL (F)
TOTAL LIABILITIES
(D+E+F)
CHAPTER VI
6.1 FINDINGS:
Cash to current assets ratio has huge fluctuations during the period.
Cash position in of the company has uneven trend.
Uneven trend in networking
The company has its working capital ratio has been above the standard norms
during the period 2000-01, 01-02, 02-03.
Liquidity position of the company is satisfied.
Current assets are not properly utilized by the concern towards the turnover.
Working capital turnover ratio in the year 2003 better when compare to the
previous year.
The company has spent huge expenses.
6.2 SUGGESTION:
The cash position of the company has not been properly maintained. So the
company has to make an effort to reduce the expenses and also cash to current
assets ratio.
Company can utilize their assets properly.
Modernized equipments can purchase.
From current ratio, overall ratio was above the accepted norms of 0.5. so the
company has to reduce the overall ratio avoid the unnecessary cash kept in ideal.
Company can properly maintain their debtors to sales turnover ratio.
A Working capital ratio has been maintained below the norms.
CHAPTER VII
CONCUSION
The project report is the apex of the master of business administration course
conducted by the Pondicherry University. The study is conducted at Cooper Bussman
India Private Limited, Setharapet with the title of a study on working capital
management. This study was conducted mainly with help of secondary data obtained
from the unit.
The company should use the minimum investment in inventory to organized it
profitability. Whether the company may invest large size of inventory to the concern.
The efficient and production levels are decreased. So the concern should maintain the
maximum investment in inventory. The company able to achieve the working capital
management objectives in proper way.
CHAPTER VIII
8.1 SCOPE OF THE STUDY
The scope of the present study on composes within its fold a theoretical frame
work of working capital management. In general, analysis of working capital trends,
relationship of working capital to sales, liquidity of working capital, analysis of
management of components of working capital and the management of working capital
finance in the select unit. The period covered by the study in five years from 2000 to
2004.
BIBILIOGRAPHY
Management accounting
S.N.MAHESHWARY
Financial management
I.M.PANDEY
Research methodology
C.R.KOTHARY
Management accounting
R.S.N.PILLAI
&
BAGAVATHI
Web site:
www.google.com
www.finance.org