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Research Methodology
Research Methodology
The study is descriptive in nature. The study is based on secondary data and it has been collected
from the published annual reports of the BRAMSCO Company, books, journals, magazines,
newspapers and websites. Research methodology is a systematic approach in management
research to achieve pre-defined objectives. It helps a researcher to guide during the course of
research work.
Proper management of working capital is very important for the success of an enterprise. It aims
at protecting the purchasing power of assets and maximizing the return on investment. The
importance of working capital management lies in the fact that financial managers spend a great
deal of time in managing current assets and current liabilities. Arranging short term financing,
negotiating favorable credit terms, controlling the movement of cash, administering accounts
receivables and monitoring the investment in inventories consume a great deal of time of
financial managers.
Research methodology is used to collect information and data for the purpose of making
business decisions. The methodology may include publication research, interviews, surveys
and other research techniques, and could include both present and historical information. A
research method is a systematic plan for conducting research. Sociologists draw on a variety
of both qualitative and quantitative research methods, including experiments, survey
research, participant observation, and secondary data. Quantitative methods aim to classify
features, count them, and create statistical models to test hypotheses and explain observations.
Qualitative methods aim for a complete, detailed description of observations, including the
context of events and circumstances.
PRIMARY
Primary data has been obtained through personal discussions with
managers and senior officials of the organization.
SECONDARY
Secondary data’s has been obtained from published reports like the
annual reports of the company, balance sheets, and profit and loss
account, booklets, records such as files, reports maintained by the
company. Mainly the annual report consists of two parts;
1) Profit and Loss Account
2) Balance Sheet
Profit and loss account reveals the income and expenditure of the
company. Balance Sheet reveals the financial position of the
organization. Those two statements are prepared by the highly
qualified and experts with the help of available information or data.
The secondary data are those which have already collected and stored. Secondary data easily get
those secondary data from records, journals, annual reports of the company etc. It will save the
time, money and efforts to collect the data. Secondary data also made available through trade
magazines, annual reports, books etc.
This project is based secondary data collected through annual reports of the organization. The
data collection was aimed at study of working capital management of the company.
Project is based on
SAMPLING DESIGN
A.Correlation Analysis
Itis defined as “the process by which two or more groups or set items may vary
together directly or inversely”.Two variables are said to be correlated, if the change
in one variable results in a corresponding change to theother variable. That is when
two variables move together, they aresaid to becorrelated.
Co-efficient of Correlation
B. Trend Analysis
Trend Analysis, also referred as Time series is the ratio which indicates the direction
of change. This analysis is important in the applicability of the items in profit and loss
accounts. For trend analysis the use of index numbers is generally adopted. The
procedure which is adopted in this analysis is to assign the number 100 for items of
the base year and to calculate percentage changes in each item of other years in
relation to the base year. This procedure is called as the “trend-percentage method”.
The trend analysis within the company’s ratio itself is informative, but it is more
informative when comparison is done with the company’s ratio with that industry
ratio. This comparison indicates how company has been operating well over time
relative to its competitors and may also help to explain the trends in the company
ratios.
C. Ratio Analysis
The ratio analysis is one of the most powerful tools of financial analysis. It is used as
a device to analyze and interpret the financial of enterprise. The important factor
used in Ratio Analysis is:
The analysis is limited to just five years of data study (from year 2006 to year 2010) for
financial analysis.
Limited interaction with the concerned heads due to their busy schedule.
The findings of the study are based on the information retrieved by the selected unit.
LIMITATIONS
The data’s were collected mainly on the basis of secondary data. So
the limitations of secondary data are applicable. Due to busy work
schedule, detailed discussions were not possible. The data collected
for the study was historic in nature, so the suggestions will be
irrelevant.