Professional Documents
Culture Documents
PROJECT REPORT
ON
“WORKING CAPITAL MANAGEMENT”
AT
BATCH 2018-2019
ACKNOWLEDGEMENT
It is a matter of great satisfaction and pleasure to present this report on “Working Capital Management” at
“Creative Carve Pvt Ltd (Pune)”. I take this opportunity to owe my thanks to all those involved in my training.
I am thankful of Mr. Dinesh Gour (HEAD OF FINANCE) for giving me opportunity to work Creative Carve Pvt. Ltd
(Pune). As an Implant trainee.
I am also thankful for their encouragement and able guidance at every stage of my training work.
I would also like to give thanks to the whole Organization as they gave me opportunity to conduct this project and
also extending hours in doing this project
I would like to thank our Director Dr. K.S. Charakand Project guide Prof. VinodBhelose
Whose valuable guidance and encouragement at every phase of the project has helped to prepare this project
successfully. I am thankful for their encouragement and able guidance at every stage of my project work.
I express my gratitude towards staff, who have helped me directly or indirectly in completing the project.
Place:
Mss.Dhanashri Durgade
DECLARATION
I hereby declare that the project titled “Working Capital Management” is an original
piece of research work carried out by me under the guidance and supervision
of “Prof.Vinod Bhlose”. The information has been collected from genuine & authentic
sources. The work has been submitted in partial fulfilment of the requirement of
Masters of Business Administration to Savitribai Phule Pune University.
CHAPTER I INTRODUCTION
1.1 Introduction
1.2 Selection of the topic
1.3 Objectives of the study
1.4 Scope of the study
1.5 Limitation of the project
CHAPTER NO. 1
INTRODUCTION
The main limitation of the research is the data sources. The data collection from
the audited financial statement, which are prepared on the historical basis.
These financial statement are prepared at the end of the financial year. So it
gives a view on particular date.
Only the printed data about the company will be available and not the back end
details
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CHAPTER - 2
CONCEPT AND RESEARCH METHODOLOGY
Suppliers
Easy
Loan Dividen
From d
Significance Distribut
of Working ion
Capital
Increase
Increase in
Debt
efficiency
Capacit
Increase in fixed
asset
On the basic
of concept On the basic of
periodic
requirement
Gross Net
Positive Negative
Permanent/fixed Tempora
working capital ry
working
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A) Permanent Working Capital:
There is always a minimum level of working capital, which is continuously required by a
firm in order to maintain its activities. Every firm must have a minimum of cash, stock
and other current asset, this minimum level of current assets, which must be maintain by
any firm all the times, is Known is permanent working capital for that firm. This amount
of working capital is constantly and regularly required in the same way as fixed assets are
required. So, it may also be called fixed working capital
The working capital needs of firm are affected by numerous are as follows:
a) Nature of Business:
In some business organization, the sales are monthly on cash basis and the
operating cycle is also very short. In these concern, the working capital
requirement is comparatively less. Mostly services giving companies come in
the category. In manufacturing concerns, usually the operating cycle is very long
and a firm has to give credit o customer for improving sales. In such cases the
working capital requirement.
b) Production Policy:
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c) Market Condition:
Due to competition in the market, the demands for working capital fluctuate. In
a competition environment, a business firm has to give liberal credit to
customer. Similarly it has to maintain a large inventory of finished goods to
services the customers promptly. In this situation, larger amount of working
capital will be required.
d) Growth and expansion activities:
The working capital needs of the firm increases as it grows in terms ofsalesor
fixed assets. This will in turns increase investment in current assets which will
result in increase in working capital needs.
e) Operating efficiency:
As the sales grow, the working capital needs also go up. Actually it is very
difficult to establish and exact proportion of increase in current assets, as a result
of increase in sales.
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OPERATING CYCLE CONCEPT:
Working capital is the life blood of any business, without which the fixed assets
are inoperative. Working capital circulate in the business, and the current assets
change from one form to these other. Cash is used for procurement of row
material and stores items and for payment of operating expenses, and then
converted into work in progress then to finished goods. When the finished goods
are sold on credit terms receivables balance will be formed. When the receivable
are collected it is again converted into cash. The need for working capital arises
because of the time gap between production of goods and their actual realization
after sales. The time gap is called technically called as ‘operating cycle’ or
‘working capital cycle’. The operating cycle of a company consist of time period
between the procurement on inventory and the collection of cash from
receivables.
CASH
ACCOUNTS
RAW
RECEVABLE MATERIA
FINISHED
GOODS WORK- IN-
PROGRESS
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GROSS OPERATING CYCLE:-
The total of inventory conversion period and debtor’s conversion period is
referred as gross operating cycle.(GOC)
WORKING CAPITALRATIO’S
1) Liquidity ratios
Liquidity refers to the ability of the firms to the meet it’s obligations in the short
run usually one year. Liquidity ratios are generally based on the relation between
current assets and current liabilities.
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2) Turnover ratio
They measures how efficiently the assets are employed by the firm. These ratio
are based on the relationship between the level of activity, represented by the
sales or cost of goods sold and levels of activity. Represented by the sales or
cost of goods sold and levels of various assets
3) Profitability ratios
This help in assessing the adequacy of profit earned by the company and also to
discover whether profitability is increasing or decreasing. There are two types of
ratios profit margin ratios and rate of return ratios. Profit margin ratios show the
relationship between profit and sales. Rate of return ratios reflect the
relationship between profit and investment.
2.2 Research Methodology
Definition of research
D. Slesinger& M. Stephenson define the research as “The manipulation of
things, concept of symbols for the purpose of generalizing to extent, correct of
verify knowledge, whether that knowledge aids in construction of theory or in
the practice of an art”. Clifford Woody define the research as, “ the process
which includes defining the problems, formulating hypothesis or sugge1sting
solutions; collecting, organizing & evaluating data; making deduction &
reaching conclusion & at last carefully testing the conclusion to determine
whether they fit the formulating hypothesis’.
Importance of research
1. Research provides the guidance to the social planning.
2. Research facilities control by the providing knowledge.
3. Research is important because it suggest effective remedial measures.
4. Research affords considerably sound for prediction.
2.3 Sources of Data
Mainly there are two type of data used for research. These types are,
1. Primary Data:
2. Secondary data:
Secondary data mean the data that are already available i.e. they refer to the data
which have already been collected & analyzed by someone else. These data is
collected from the financial reports of the bank. The data which are primary in
hands of ne becomes secondary In hands of other.
2.4 Sources & Methods of Data Collection
There are different from which primary & secondary data has been collected.
These are;
A) Observation:
Observation is most commonly used method especiallyin behavioral science.
The information obtain under this method relates to what is currently happening,
it is not complicated by either the past behavior or future intension. In
observation method it is enable to record the natural behavior of group.
B) Questioner:
Sources of Data
The major sources of data were secondary data, where in the balance sheets and
profit and loss statement were basically used to find about the figures needed for
the analysis.
The balance sheets and profit and loss statement for the four previous years
were used.
The primary data was obtained though discussions with the senior
managers and chief finance officer (CFO).
Collection of Data
All the relevant information about the project was obtained from the
company’s financial statement; books on financial management were also used
for collection of data which were used for the analysis part.
1.Primary Data:
We are collected data during the course of doing experiment in experimental
research we can obtain primary data either through observation or through direct
communication with respondent in one form or another or through personal
interview. Primary data is collected personally to be used. Primary data is first
than information collected by research from observation communication.
2.Secondary data:
Secondary data mean the data that are already available i.e. they refer to the data
which have already been collected & analyzed by someone else. These data is
collected from the financial reports of the bank. The data which are primary in
hands of ne becomes secondary In hands of other.
CHAPTER – 3
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ORGANIZATION PROFILE
3.1 COMPANY PROFILE:
Introduction
Company was registered in the year 1985 with Registrar Of Companies as
closely held family business.
The Company was established to serve Automobile industry with precision-
machined components.
CCPL commenced production in the year 1986-87.
Operations were started with machining of Valve Tappets and Valve Seat Inserts
(Rings) supplied to M/s Pefco Foundry and Chemicals and initial turnover of
Rs. 5.00 lacs.
Since then the company has progressed steadily to target a turnover of Rs. 100
Million in the year 2005-06. We now manufacture variety of Disc Brake Pistons,
Differential Pins (for idler gears), Wheel Spindles, Retainer rings. We even cater
to Defence requirements for critical components and have developed
components.
We have continuously updated our manufacturing facilities to achieve quality
and economy in our operations.
Secret of success lies in CUSTOMER SATISFACTION through the Quality
standards and service. While maintaining the highest quality standards, economy
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in operations has been base of our working. The unit enjoys SELF
CERTIFICATION status at most of customers.
th
We are an ISO 9001-2000 certification since 10 September, 2002.
ISO Registration number (RQ91/856.) along with IATF16949:2016.
We have yet to fail on customer delivery schedules and commitments. In fact
90% of urgency and emergency calls of customer for non-scheduled supplies
are met with. This has resulted in customer confidence in us giving us
distinction.
SINGLE SOURCE for most of the components produced by us for almost all our
customers.
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3.2 COMPANY MISSION AND VISION:
3.2.1 Mission:
3.2.2 Vision
3.2.3. Values
- Integrity
- Dignity
- Honesty
- Leading Changes
- Excellence
- Respect for Individuals
- Learning And Sharing
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3.3 Quality Policy
Customers Satisfaction is our main goal and we work ceaselessly to achieve this
objective.
Differential Housing
Axle Components
Transmission Components
Automotive Components
Other Components
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3.4 Pruduct Profile
DIFFERENTIAL HOUSING
AXLE COMPONENT
24
TRANSMISSION
25
AUTOMOTIVE COMONENTS
OTHER COMPONENTS
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3.5 Manufacturing Process:
Crative Carve Pvt.Ltd machines are equipped for both individual and diversified
processes, and their flexibility enables us to employ them inthe most optimum
manner to suit the customer‘s preferences. Additionally, most of our machinery
with certainmodification is capable of being used interchangeably for either of
our sectors, depending on the demand for such products.
We have and may have dedicated production lines based on the size and
frequency of the orders of our customers.Typically, our manufacturing process
consists of machining inspection and assembly (if any). The production process
maybe diagrammatically explained in the following manner:
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3.5 Organization Flow Chart
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3.6. Production Process Flow:
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3.7 Organizational Working System:
CHAPTER – 5
5.1 SUGGESTIONS
In the year 2015 the net working capital ratio is positive & In the year 2015&
2017 the net working capital are negative its means the company’s current
assets is lowest than current liabilities. So they should try to increase their
current assets.
The current ratio & quick ratio of the company’s are decrease so the both
ratios should be increase up to standard ratio.
The profitability ratio of the company is well but the company should try to
improve profitable ratio for better performance in future.
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5.2 CONCLUSION
This project work in the in finance sector is going to help me a lot in future. I got
to learn many financial aspects of the organization. It was great opportunity for
me to do my Summer Project at Creative Carve Pvt. Ltd.
\
B IB LO G RAPHY
Books:-
FINANCIAL MANAGEMENT BY I.M. PANDEY
FINANCIAL MANAGEMENT BY PRASANNA CHANDRA.
ANNUAL REPORT OF CREATIVE CARVE PVT LTD.
Website:-
www.creativecarve.com
www.wikipedia.com
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