Ratio Analysis Project

WORKING CAPITAL AT JAMKHANDI SUGAR’S LIMITED.
-: CONTENTS :-
CHAPTER-1
INTRODUCTION
 EXICUTIVE SUMMERY
 OBJECTIVES OF THE STUDY
 NEED FOR THE STUDY
 SCOPE OF THE STUDY
 METHODOLOGY
 LIMITATIONS OF THE STUDY
CHAPTER-2
 THEOROTICAL REPRESENTATION OF WCM
CHAPTER-3
 PROFILE OF THE COMPANY

 HISTORY OF THE COMPANY
 FUNCTIONAL DEPARTMENTS
CHAPTER-4
 DATA ANALYSIS & INTERPRETATION

 BALANCE SHEET OF THE FACTORY
CHAPTER-5
 FINDINGS & SUGGETIONS
 CONCLSION
 BIBLIGROPY
G.F.G.C.W’S
COLLEGE JAMKHANDI {WORKING CAPITAL MANAGEMENT} Page 1 of 63
CHAPTER - I
G.F.G.C.W’S
CHAPTER - 1
INTRODUCTION
EXICUTIVE SUMMERY
The study of condected on the “STUDY ON CHANGES IN WORKING

CAPITAL MANAGEMENT” The study was conducted in Shares JAMKHANDI
SUGARS LTD. Was registered in the year 1969 and started at sustains 1974. The plant is
located at Naganure village of Jamkhandi in of Bagalkot district.
For the population of the study is all the workers are working in the
JAMKHANDI SUGARS LTD . For the purpose of project work sample of 30
employees respondents hav e covered. These also while administration Questionnaire care
was taken to ensure that the sample ratio is the responsentative of the population.
The study concludes with view that,attitude of workers towords job is an

imported factor for future development of the company.
OBJECTIVES OF THE STUDY
 To study and examine the present situation and nature of working capital position
 To analyze the working capital with the help of the ratios & identify the strength and
weakness of the organization
 To study the sources of the working capital
 To provide large scale employment
 To calculate the gross and net working capital for the past 5 year
 To calculate the operating cycle at Jamkhandi Sugars
G.F.G.C.W’S
NEED FOR THE STUDY
Analytical study of the project helps to strategic decision and it evaluate the objective
of the project in prospective way it identify constrains on source and applications of project.
These are an idle sugar industry or a factory need was felt to analysis the financial flow and
performance of company . hence the study is conducted.
SCOPE OF THE STUDY
The scope of the study is to analysis the working capital management from 2012-
13 to 2016-17 of JAMKHANDI SUGARS LTD,HIREPADASALAGI.
The study focuses only on working capital management of the company. The project is
limited for four years data (2013-14 to 2016-17) of JSL , Hirepadasalagi.
RESEARCH METHODALOGY
It is the science of method or the body methods used for study methodology are
indispensable.Becouse of its scientific free thoughts. Unless a proper method is followed project
work or study will not be completed successfully. Therefore to arrive notable result methodology
should from a significant part of it.
The aim of methodology is to present a clear idea of the procedure followed in this study since
the values of any systematic and scientific research lies in this methodology which give a clear
idea of the form of procedure adopted in conducting it and stating the purpose become an
essential part of every study . In this project work re-search has adopted following methodology
to collect the data.
G.F.G.C.W’S
SOURCE OF DATA
For solve any problem, the primary requirement is data, before conducting the study the source of
data to be identified. There are two source of data. The are:
 Primary data
 Secondary data
PRIMARY DATA:
Primary source are original sources, which is first hand information collected
through various methods by way personal interview, direct investigation with the staff member
or employees of the factory.
SECONDARY DATA:
The factory by way of recorded facts and information. Annual reports & manual
prepares the secondary sources of data. The balance sheet & profit & loss account provides the
secondary information. Such data are already prepared in some other context & not specifically
for taken up.
LIMITATION OF THE STUDY
 The data is supplied by the company personnel.
 The study is concerned to only one factory.
 The detailed study of the data is complex in nature as the data is collected based on
conclusion and observation.
G.F.G.C.W’S
 The study is based on primary and secondary data.
 Non availability of adequate data.
 It is very difficult to collect more information about finance.
 Busy schedule of the staff posed difficulty in collecting data.
 Time period of the study will be restricted.
 The accuracy of the information provide in the report depends upon the information’s
given by the factory
G.F.G.C.W’S
CHAPTER - II
G.F.G.C.W’S
CHAPTER -II
THEROTICAL REPRESENTATION OF WCM
WORKING CAPITAL INTRODUCTION:
Since the efficiency of the working capital Management is determined by the

efficient administration of its various components; cash, account receivable and inventory , the
study attempts to determine the management of each component.
Concept of working capital
There are two concept of working capital viz. quantitative and qualitative. Some people also
defined the two concepts as gross concept and net concept.
According to Qualitative Concept gives an idea regarding sources of financing

capital. the amount of working capital refers to “excess of current assets over current
liabilities”.Net working capital
According to Quantitative Concept amount of working capital refers to ‘total of

current assets’. That we call current assets? Smith called , ‘circulating capital’. Current
assets are considered to be Gross working capital.
Definition:
According to L.J.Guthamann: Working capital as “the portion of a firm’s current

assets which are financed from long term founds”,
G.F.G.C.W’S
According to Gerestenberg: Circulating means current assets of a company that are

changed in the ordinary course of business from one from anther
Working capital= Current assets-current liabilities
Need for working capital:
Every business require some amount of working capital arises because of the time gap between
the production and needed for the following purpose
 To pay wages salaries.
 To incur day to day expense.
 For the purpose of Raw materials, components and spares.
 To provide credit facilities to the customers.
 To maintain the inventories of raw materials working in progress and finished
stock.
Sources of working capital:
The capital has two segment of working capital viz., regular or permanent and variables are
financed by the long term and short term sources of funds respectively
 Loans from commercial banks

 Public deposits
 Trade credit
 Factoring
 Discounting bill of exchange
 Bank over draft and cash credit
 Advance from customers
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 Accrual account
Classification of working capital :
There are two type of working capital they are:
1. On the basis of concept.

2. On the basis of time.
On the basis of concept: On the basis of concept, working capital is classified as gross working
capital and net working capital.
o Gross working capital : It represent the amount of funds invested in current assests.
o Net working capital: It is the excess of current liabilities.
On the bases of time: On the bases of time, working capital is classified as permanent of fixed
working capital and temporary or variable working capital.
o Permanent or fixed capital: Permant of fixed working capital is the minimum amount
which is required to ensure effective utilization of fixed facilities and for maintain the
circulation of current assests.
o Temporary or variable working capital: Temporary working capital is the amount of
working capital which is required to meet the seasonal and some special exigencies.
G.F.G.C.W’S
Factor determining the working capital:
 Nature of business.
 Condition of supply.
 Production policy.
 Seasonal operation.
 Credit availability.
 Growth and expansion.
 Price level change.
 Volume of sale.
 Liquidity and profitability.
Principal of working capital management:
o Principal of risk variation.

o Principal of equity position.
o Principal of cost of capital.
o Principal of maturity of management.
RATIO ANALYSIS:
Ration Analysis is a widely used tool of financial analysis. It defined as the systematic use of
to interpret the financial statement so that the strength and weakness of a firm well as its
historical performance and current financial condition can be determined. This relationship can
be expressed.
G.F.G.C.W’S
Types of Ratios:
1. Current Ratios
2. Quick Ratio.
3. Debtors Turnover Ratios.
4. Debtors Collection Period.
5. Net Working Capital Ratios.
6. Inventory Turnover Ratios.
1) Current Ratios:
It can be calculated as current assets divided by current liabilities. The current ration
measures the relative ability of a company to pay its short-term debts. The ratio is used to reveal
well a company could meet a sudden demand to pay off its short-term creditors.
Current asset
Current Ratio = Current Liabilities
2) Quick Ratio:
It establishes a relationship between quick or liquid, assests and current liabilities. An

asset is liquid if it can be converted in to cash immediately or reasonably soon without a loss of
value. Cash is most liquid assests.
Current asset−Inventories
Quick Ratio = Current Liabilities
G.F.G.C.W’S
3) Debtors Turnover Ratio:
The ratio measures the utilization of investment in debtors. Profitability of a firm is

dependent on sales; a firm can increase sales by selling on credit.
Credit Sales
Debtors Turnover Ratio = Average Debtors
4) Debtor’s Collection Period:
It measures the number of days taken to collect the debts. Calculation of debt’s
collection period can help a firm to know the number of days debtors are converted into cash. It is
calculated by the following equation.
Debtors
Debtor’s collection period = Credit sales
5) Net Working Capital Turnover Ratio:
The ratio measures relationship between sales and working capital. Net sales
includes sales-returns. And working capital means current assets. It is calculated by applying
following equation.
Net sales
Working capital turnover ratio= Workingcapital
G.F.G.C.W’S
6) Inventory Turnover Ratio:
Inventory refers to capital locked in various types of stock like raw materials,
work in progress and finished product. Firms should ensure that these stocks or inventories
are activity utilized giving no scope for dead investment.
Net sales
Inventory Turnover Ratio Workingcapital
Working Capital cycle/ Operating cycle
The rime between the purchase of inventory items and their convention
into cash is called operating cycle. Thus, the inventory duration of time required to complete
the following sequence of events in case of a manufacturing firm is called the operating cycle.
 Conversion of cash into raw material
 Conversion of raw material into work in progress
 Conversion of work in progress finished goods
 Conversion of fixed goods into debtors and bill receivables through sales
 Conversion of debtors and bill receivable into cash
G.F.G.C.W’S
OPERATING CYCLE
Calculation of Operating Cycle:
O=R+W+F+D–C
O = Duration of operating cycle
R = Raw material and stores, storage period
W = Work in progress period
F = Finished goods storage period
D = Debtors collection period
C = Creditors payment period
Average stock of raw material∧stores

R= Average raw material∧storesconsumption per day
Average work ∈ progressinventory

W= Average cost of production per day
G.F.G.C.W’S
Average finished goods inventory

F= Average cost of production per day
Average book debt

D= Average credit sales per day
Average trade creditors

C= Average credit purchase per day
G.F.G.C.W’S
Operating Cycle
G.F.G.C.W’S
CHAPTER - III
G.F.G.C.W’S
CHAPTER – III
INDUSTRY PROFILE
Introduction to sugar Industry
The sugar Industry Occupies a permanent place among the organized Industry has a
second rank on textile industry in important. The sugar Industries and contributes to the revenue
of central and state govt.’s a sum 400 crores in the form of taxes. in recent year it has emerged as
the largest foreign exchange earner.
To India become largest sugar producer in the world. India produces 190-200 lakhs metric tons of
sugar per year.
G.F.G.C.W’S
The sugar cane is being grown in many states of India like Maharashtra (first place),
Uttar Pradesh, Gujarat and Karnataka. In Karnataka the sugar cane is mostly grown around
Bagalkot, Belgaum, Mandya district and coastal areas. The sugar can be grown in all type of soil
but heir yield can be obtained in black fertile soil.
Growth and Development of Sugar Industry
In India production of began in the year 1875 for domestic use because India is the
original home of the sugar and it has a flourishing
Sugar Industry in the ancient times. But the modern sugar manufacturing Industries were
establish in Bihar but the real development of sugar Industry took place only after, In the year of
1932, when protection was given to this Industry against for in competition for a short period 2-3
year.
The number of sugar mills were 32 in 1931-32 and increased to 1935-36 and the
production also increased during the same period .
The table below shows that the sugars industry status in India
Types of sector In India In Karnataka

Co-operative sector 235 18
Private sector 120 31
Public sector 95 02
Total 450 51
G.F.G.C.W’S
New guideline to sugar Industry
In July 1990 the government of India Issued new guidelines for licensing to
start new sugar factories; the licensing policies has made very liberal so as to boost the
production of sugar.
Hence it is a raw material oriented industries, the concentration of sugar cane is found
in the areas of Maharashtra and part of north Karnataka. The sugar industries are one of the
highly regulated industries. The development of this industries is thus very closely linked with
the policy measures adopted by the Govt. from time to time.
Main problems of sugar cane
1) Inadequate supply of sugar cane
One of the important problem facing the sugar industry is the inadequate supply of
sugar cane; this is due to
a) Low yield of sugar cane

b) Increased use of sugar cane for manufacturing other than sugar produced
2) Uneven regional distribution
The sugar industry was initially unevenly distribution in the country. It was
largely concentration in Bihar & UP. These two states contributing nearly 60 to 70% of
total sugar production in country.
G.F.G.C.W’S
3) High cost of production
Indian sugar industry has the cost of production; in fast price of sugar in India is
sufficiently higher than the normal world price.
4) Short crushing season
Another weakness of the India is that the crushing is very short it runs for
nearly 100 to 110 days in a year therefore the sugar factories have to work only for short
period in a year.
5) Insufficient management
Many sugar industries are suffering from low efficiency which in its ton has led
to the high cost of production and the price of sugars.
6) The problem of by production
The various by product of sugars industry like bagasses , Molasses, Press mud etc,, are not
properly utilized income from these by product is very low.
G.F.G.C.W’S
Introduction of Jamkhandi sugars LTD,
Jamkhandi sugars Limited was introduced in 1993 to establish a co-generation
project in backward rural area which server as a powerful media for augmenting the socio
economic property of the farmer in particular and of industrial background of Bagalkot, Vijaypur
district in general.
Shri Siddu B.Nyamgoud the chairman who promoted the company with the association of local
farmer and general public has engaged himself in socio-economic development of these region
since 20 years.
There are 9 sugars industries in Bagalkot District. The distance of these
industries is 15km. Among these industries the fastest development In Jamkhandi sugar Limited,
Jamkhandi Herepadasalagi.
Jamkhandi Sugar Limited(JSL) is the largest sugar and ethanol producer in coastal India with
main operation in the state of Karnataka Jamkhandi sugar is an integrated manufacturing
company with strategic focus on sugar bi-field’s and allied products renewable energy.
Jamkhndi sugar Limiteda registered public company has establish a new mill with accompanies
to crush 500 TC per day sugar cane. Expandable to 6000 and co-generation of 12 MW power in
two phases at MW each 3.5 MW would be demand for the own consumption with surplus power
8.5 MW for sale.
G.F.G.C.W’S
Jamkhandi sugar Limited is registered companies act 1956 with registration No.08/14570 on 26 th
July 1998. A letter has been issued on 31 st , 1994 which was extended up to July 1998. The sugar
factory is located at Herepadasalgi village situated about 20kms from Jamkhandi town Bagalkot
District in an area of 150 acres has of 150 acres has the site is at a distance of 5kms from
Vijaypur to Dharwad state highway.
The project envisaged for installation 2500 TCD capacity produced with co-generation was taken
up April-May-2001 and commercial production during the October 2001.
VISION & MISSION OF THE INDUSTRY
VISSION:
 Jamkhandi Sugar Limited shall strive hard generated electronic by natural resources and
manufacture sugar by agro based farm.
 To create employment opportunity in rural and supporting agriculture activities.
 To capitalized in rural economically backward class people.
MISSION:
 Development and strengthen or rural areas .

 To provide products of superior quality of sugar at competitive price.
 To protect the interest of all concerned promoters, customer, Agencies, Distributor and
Employ.
G.F.G.C.W’S
GOAL OF THE COMPANY
 To maintain of available resource like manpower, machinery, material to

produces sugars and development of irrigation project.
 To proper utilization of crushing 6000 TCD and power generation 29 MW’s.
 To manufacturing sugar and its by-products out of sugar cane grown and
supplied by member of the society and to sell the same to best advantage.
 To install machinery for the utilization of by product and buy raw material and
sell finished products in the course of utilization and marketing by products.
 To carry on the business of generation, distribution, supply, sale or export of

electronic power, whether by the use of Bio-mass biogases, hydro electronic
with thermal, solar or any other from of energy.
 To guaranty the performance of any contract or obligation and the payment of

money(Whether secured or unsecured) of any company, or person in any case in
which such guaranty may be considered likely to further the main objective of
the company or the intrst of its shareholder.
 To manufacture sugar portable spirit and by production out of the sugar cane
supplies, by the member and others and to self – sugar, portable spirit etc,,,…so
the manufactured to the best advantages.
 To carry on the business of manufacturing refiners, producer, importance,

export and dealers in all kinds of sugar products, molasses, combustible fuel,
G.F.G.C.W’S
yest and other fermentation, organic and inorganic chemical, starch, syrups all
alcoholic substances, acetone, spirits, sugar candy, glucose, confectionary
canned fruit.
COMPANY PROFILE
Name of the company Jamkhandi sugar Limited
Adress At: Hirepadaslgi, post, Nagnur

Tq: Jamkhandi
Dist: Bagalkot
State: Karnataka
Registration no 08/14570
Registration date 26th July 1993
Year of establishment 26th October 2001
Crushing capacity 5000 TCD to 600 TCD
Co-generation 29.MW
Project cost Rs. 8300 lacks
Total land
Raw material Sugarcane
Total share holder 7800(each member are buy 500 shares

at Rs.10each)
Telephone no 08353-254161, 254162
E-mail JSL Info@Rediffmail.com
G.F.G.C.W’S
Exicutive of Jamkhandi Sugar Limited
The company is managed by board of directors, chairman Shri S. B. Nyamgoud, MD,Shri V

Shivprakasham. The constitution board as under:
The constitution board is as follow:
NAME DESIGNATION
Shri. S.B. Nyamgoud Chairman
Shri. V.Shivprakasham Managing director
Shri. G.S.Nyamgoud Director
Shri. R.B.Patil Director
Shri. Rajiv S.Kadapatti Director
Shri. L.S. Savadi Director
Shri. A.A.Huddar Director
Shri. Suresh A. Patil Director
Shri. Niraj Chandr Director
Shri. Shyam A. Mule Director
G.F.G.C.W’S
NOMINEE DIRCTORS:
NAME DESIGNATION
SHRI.B. SWAMINATHAN IREDA
SHRI. N.K. PARASHURAM KSLLDC
The board is supported by following Executives in the management
Shri. V. Shivprakasham Managing director
Shri. Subash Naik General manager wokers
Shri. M.I Choudhri Assistant HR Manager
Shri. Anand S. Nyamgod Depputy General Manager(admin)
Shri. R. Verma General Manager (Finance and

Accountant)
Shri. M. I. Horti Accoun Manager (Finance and

Accountant)
Shri. H. R. Kanti General Manager Cane
Shri. H.R. Ambi Deputy Manager Cane
G.F.G.C.W’S
Cost of Project
Particular Amount ( In lakhs)
Coast of capital Original Increased Total
Land and Development 92 17 109
Building & civil workers 770 365 1135
Plan & machinery 4330 419 4749
Miscellaneous fixed assets 280 5 285
Pre-operative expences 485 723 1208
Preliminary expenses 35 ……. 35

written of
Contigencies 250 ……. 250
Margin money for 381 110 491

working calital
Investment ……. 38 38
Total 6623 1677 830
G.F.G.C.W’S
MEANS OF FINANCE
Particulars Amount ) In lakhs)
Means finance Original Increased Total
1) Share holders fund 2395 430 2825

2) Term loans
3) Commercial co- 2100 - 2100
operative bank
4) IREDAI Bnak 2128 1247 3357
Total 6623 1677 8300
BANKERS
Term loan leading institution Amount ( in crores)

IFCI LTD 10.00
IREDA 21.28
KSCAB 06.00
KSIIDC 03.00
SBI 02.00
Organization chart
Chairman
G.F.G.C.W’S
Exicutive Director General Manager
Production Cane Finance Personal Marketing

Manager Department Department Manager Manager
Manufacturin Asset. COD F.D.A Security Sales

g
Officer Manager
Supervision Field Officer S.D.O Godown

Time
Officer Keeper
Environment
Assistant Labour
Mechanical
Electronic
Achievement of the company performance operation

G.F.G.C.W’S
Year Total Cane Crushing Total Sugar Bagged

2001-02 2,45,380.290MT’s 2,75,788 Quintals
2002-03 3,90,090.000MT’s 4,49,300 Quintals
2003-04 2,50,000.000MT’s 2,69,000 Quintals
2004-05 2,20,522.680MT’s 2,38,985 Quintals
2005-06 4,71,418.854MT’s 5,52,015 Quintals
2006-07 5,34,367.976MT’s 6,45,015 Quintals
2007-08 4,74,132.063MT’s 5,82,695 Quintals
2008-09 4,21,315.976MT’s 4,31,640 Quintals
2009-10 5,30,010.321MT’s 6,20,825 Quintals
2010-11 5,15,252.257MT’s 6,04,150 Quintals
2011-12 6,22,132MT’s 7,34,490 Quintals
2012-13 5,25,134.000MT’s 5,25,766 Quintals
2013-14 7,47,197.000MT’s 8,40,440 Quintals
2014-15 92,33,70,110.7810MT’s 11,07,810 Quintals
2015-16 2,20,76,47,421.00MT’s 9,37,959.00 Quintals
2016-17 2,83,27,23,464.00MT’s 8,51,755.00 Quintals
Achivievements:
 Jamkhandi Sugar Limited awarded for former’s of best shareholders.
 “BEST PERFORMANCE SUGAR FACTORY AND BEST CANE DENELOPMENT”
“SECOND PLACE IN KARNATAKA FOR THE CRUSHING SEASON 2006 & 2007”
from the south Indian sugar cane technologists association(SISSTA)
 Second place in “BEST PERFORMANCE SUGAR FACTIRY SECOND PLACE FOR
BEST CO-GENERATION AWARDS 2007 & 2008” FROM SISSTA.
G.F.G.C.W’S
 Received award for “BEST PERFORMANCE SUGAR FACTORY from SISSTA ON 38 th
annual convention held in Chennai 9th august 2007.
Department Of Factory
1) Cane Department
Cane department is one of the departments, which will take overall
responsibility of the raw material supply for the industry; the main raw material is sugar
cane. It plays a major role in purchasing sugar cane from various places nearby factory;
Varity of sugar cane:

 COC-671
 CO-8011
 CO-940
 COC-86032
 CO-8014 etc.
The main subsection in this department are:
 Cane head office

 Circle officer
 Cane yard
2) Productio/Manufacturing Department
G.F.G.C.W’S
Manufacturing department is one of the most important parts in every
manufacturing industry. Especially in sugar industries, manufacturing department plays an
important rule as the total output of the company depends on the quality of product.
Manufacturing Process:
Cane weighted
Cane unloading
Cane conveying
Cane preparation Residential bagasses

used
Milling
Bagacillo used for mud

mixing
Raw juice weighing G.F.G.C.W’S
Sulphitation
Sedimentation
Filtration
Evaporation
Syrup sulpthitation
Crystallization
Gradation
Storage
The manufacturing process consist of following steps;
 Crushing
 Clarification
 Evaporation
3) Purchase Department
It is also important section in administration deparment in maintenance of

commodity required for the company. This section is concerned to administrative manager
(Technical general manager).
G.F.G.C.W’S
If the company wants to purchase some materials required in factory or office they will received
demand slip from department.
Staff:
IN this section 4 employees are working. The hierarchy goes like this;
Assistant purchase officer

Purchase assistant
Computer operater
Local purchase/purchase
Procedure for purchasing the material required for whole company
 Enquire
 Collection of purchase orders
 Negation
 Finalization of purchase order
 Purchase goods are issued to stores department
4) Marketing And Sales Department
Departmental strcture
Sales officer
Central excise officer
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Sales man
Godown keeper
Loading keeper
Sugar loading labour
Sales department:
The sales department looks after the sales of following products produced by the units.
 Sugar ( Main Product)

 Molasses (By product)
 Bagasses ( By product)
Flow of sales department
Sales Manager
Assistant godown
G.F.G.C.W’S
Senior clerks
5) HR Department
Human resource development is concerned with providing learning and development

opportunities, making training intervention and planning and conducting traning programs.
It is essentially a strategic process, which is concerned with meeting both business and
individual’s needs.
Selection and Recruitment process in JSL
Promotion strategy:
They promote their employee by considering skill, service, age and all department
requirement.
Recruitment of new employee in a company is the main and important role personal
department. The following chart shows the recruitment process.
Selection and Recruitment Process :
Advertising
Securitization of the application
Interview
G.F.G.C.W’S
Letter of offer
Induction
Appointment
6) Computer Department
Electronic Data process is a part of administration department, where the
overall control of the computer operation takes place, for example data base management,
network connection etc.
Employees:
Three persons are working in this department
 Software export
 Hardware export
 Assistant in hardware related problem
7) Store department
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In this department, further requirement of material are gathered. Here store
keeper maintains the materials in stores properly. The store officers buy the goods also.
The organization purchase diesel from Indian Oil Corporation Belgaum. Diesel is one of
the most required materials here material approval memo is connected department.
When Stock is made they will maintain following books:
1. Transport registration
2. Bin card
3. Issue Indent
4. Bin card entry
Staff
Store in charge
Assistant
Helper
8) Finance department
It is main hart of the industry, It is the combination of sale, purchase, cane

accounts and cash accounts. It is headed by chief manager finance and subordinated by manager
accounts, sale officer, cane account and other concerned clerks and assistants.
The accounts department is key department to determine the profile of on

organization it maintain all the records, transaction & P & L balance sheet.
Duties of Account department
 To check the A/C
 To makes final A/C’s & balance sheet for the year ending
G.F.G.C.W’S
 The maintaining purchase & sale A/C’s
 To make Tally A/C
 A/C maintaining to show all the A/C’s to the MD It has mainly two sub-sections such as;
 Cane A/C section
 General A/C section
9) Time section
Employees:
 Head time keeper
 Time keeper
Functions/Procedure followed in time office
 Maintenance of attendance.
 Maintenance of over time duty and leave record.
 Compensatory for working holidays .
 Maintenance of personnel file.
 Giving appointment letter to the employees.
 Sending circular, memos, notices, to the employyes.
 Sending circular, memos, notices, to the concerned departments employees.
Registration to be maintained
G.F.G.C.W’S
 Attendance register
 Salary register
 Leave register
 Absent register
 Employee record file
Shift Timing
 1st shift : 5 AM to 1 PM
 2nd shift : 1 PM to 9 PM
 3rd shift : 9 PM to 5 AM
 General shift : 9 AM to 5:30PM
10) Security Section
Security is the major connection in every factory, which will help to avoid risk to
the factory; the risk may be fire accidents, theft and it also maintains proper monitoring of
vehicles and employees and public.
Employees;
 Security officer (2)

 Supervisors (4)
 sGuards (25)
Systems and Procedures:
 They are maintaining different type of visitors register, material inward register, material
outward registers, returnable material register.
G.F.G.C.W’S
 In outward material register they are maintaining the details of goods like sugar, molasses,
press mud and boiler ash. The concerned party name, time of dispatch and their signature will
be mentioning all these reports.
 The security will take care of fire accident in the factory. They are maintaining fire
extinguisher in the factory especially near the boiler and petrol bunk, especially areas where
electrical short circuit takes pplce inside the plant.
 They also maintaining the first aid box for any accidents inside the plant and for illness of the
employees.
 They will check the person as well as vehicle while entering inside the plant.
Products of the JSL:
Products
Main product By product
G.F.G.C.W’S
Sugar
1) Power
2) Bagasse
3) Molasses
4) Press mud
Main product – White Crystal Sugar
Sugar:
Jamkhandi Sugar Limited is known for its high quality, hygiene and good taste. Sugar
manufacturing process at plant takes place under strict quality control measure and produced
sugar is now here touched by hands. They are always among the first to adopt latest equipment
technology to ensure that product quality is nothing but the best. Jamkhandi Sugar Limited is
crystal clear and is known to be sweeter and healthier than many other sugar brands.
The main product of the sugar manufacturing process is white crystal sugar. This white sugar is
categorized in the following grades;
 M-30[Large size sugar]

 S1-30[Small size sugar]
 S2-30[Medium size sugar]
Sale of the white crystal sugar is done though a central government process in which quota of
free sale sugar is allotted to individual sugar mills. For now, sugar mills are not allowed to sell at
on go the part of the production which theycan sell in the open market. This is expected to
change. The sugar mills can 90 percent of their total production in the open market, compared
with 60-70 percent erlier. The rest has to be sold the government at levy prices it decides.
BY PRODUCTS:
Power:
G.F.G.C.W’S
The bagases’ is the raw material to generate the power. Power generation increase the
28 MW to 38.5 MW known SPSCL generation 38.5 MW power they use only 16.5 MW and
remaining 22 MW sold to India Energy Exchange[IEX].
Bagasses:
Bagasses is the one of the by products obtained during the process. It is used as fuel for
boiler to produce steam through which electricity is obtained. The bagasse produced after
extracting the juice from sugar cane as fuel to generate steam in factories, Increasingly large
amount of bagasse are being made in to paper, insulting board , and hard board as well as
furfural, a chemical intermediate for the synthesis of furan.
 Power generation
 Paper production
Press mud:
Press mud is given to use it as fertilizer to grown sugar cane at lower cost. It is prepared
by the remaining by product after the production of sgar.
Molasses:
Molasses is a delicious by product which extracted during the sugar cane refining
process used make sugar crystal. The sugar cane is crusted to remove the jouce which is than
boiled vigorously. Machines utilize centrifugal force to extract the sugar crystal from the syrup.
The remaining syrup becomes molasses. It is used in the production of industrial alcohol, organic
and chemical.
 Yeast
 Industrial alcohol
SWOT Analysis:
Study of internal and external environment is an important part of the strategic

planning process. Environment factor internal to the firm usually can b classified as the strength
or weakness and those internal to the firm can be classified as the opportunities or threats .
STRENGTHS:
G.F.G.C.W’S
1. Dynamic management
JSL management committee has a successful record in this industry. Their

experience and the network of available connection have developed over time and have
contribution greatly to it.
2. Good plant location
JSL is ideally located in area which is fully irrigated and peria farmer are
cultivating sugar cane and farmers ar more satisfied of factory billing and other facilities .
3. Experienced workers
JSL team is experienced in producing more quality sugar; moreover they are
willing to put in extra time and effort to build a successful business.
4. Computerised system
JSL all departments are computerized.
5. Plant layout
JSL has organized ell structured plant layout which help flow of production put in
extra time and effort to build a successful business.
WEAKNESS:
1) Training program : There is no structured training program for the employees.
2) Number of employees : The average age of the employees is very high.
3) High cost of investment : Any modernization involves heavy expenditure.
4) The sugarcane availability is become less due to uncertainty in rainfalls condition.
G.F.G.C.W’S
5) The JSL is facing competition from neighbouring sugar industries for procurement of
sugarcane.
6) Climate condition: The factories raw material depends on the condition because the
sugar sugar depends on climate. So the main weakness of the factory is climate
condition.
Opportunities:
1) Rapid growth of agriculture sector: Now a day’s sugar industry has got more
demand and price also more help to farmer because factory habe supplied press mud.
2) Government polices: Govt. of Karnataka has planned to provide irrigation facilities to
the farmers in north Karnataka district, his help to enhance the production in coming
year.
3) By products by using molasses and bagasse: Molasses is used in the manufacture of
ethyl alcohol, Indian made foreign liquor (IMFL), as a table syrup and flood flavoring.
It is also used as feed for farm animals and in the manufacture of several processed
tobaccos.
4) Regular finance assistances by state and central government
All these above projects will give the company maximum profit.
G.F.G.C.W’S
CHAPTER – IV
Statement’s Showing Changes in Working Capital

Of the year 2011-12 and 2012-13
Particular 2011-12 2012-13 Increase Decrease

A. Current
Assets
Inventories 1556111176.30 2119489024.63 563377848.33 ------
Sundry debtors 55135887.23 63025515.03 7889627.8 ------
Cash and Bank 73955755.32 27095411.46 ------------- 46860343.86
balance
Loan & 158168622.90 266491121.78 108322498.88 -------------
G.F.G.C.W’S
Advances
Total of A 1843371441.75 2476101072.90
B. Current
Liabilities
Current liabilities 1133983567.19 1820671353.32 -------------- 686687786.13
Provisions 27187310.00 9608116.00 17579194 -----------
Total of B 1161170877.19 1830279469.32
Net Working 682200564.56 645821603.58
Capital(A-B)
Decrease in --------------- 36378960.98 36378960.98 -------
Working Capital
Total 682200564.56 682200564.56 733548129.99 733548129.99
Net Working Capital for the year 2011-12 & 2012-13
69000000
68000000
67000000
66000000
65000000
64000000
63000000
62000000
2011-12 2012-13
Interpretation:
In the above analysis Net working capital in the year 2011-12Rs 682200564.56 and in the
year 2012-2013 Rs 645821603.58 both we found that in the year 2012-13 there is decrease
G.F.G.C.W’S
in working capital of Rs 36378960.98 There is decrease in cash and bank balance and
provisions and current liabilities. So there is decrease in working capital in this year.
Statement’s Showing Changes in Working Capital for the year 2012-13 and 2013-14
Particular 2012-13 2013-14 Increase Decrease
A. Current Assets
Inventories 211489025 3092200521 972711496 ----------
Trade receivables 63025515 62964907 ----------- 60608
Cash and Bank balance 27095411 65537451 38442040 -----------
Short term Loans 144758872 297302060 152543188 -----------

&Advances
Other current asset 170916866 109476777 ----------- 61440089
G.F.G.C.W’S
Total of A 2463845600 3627481716
B. Current Liabilities
Short term barrowings 2113215850 2053052799 60163051 ----------
Trade payable 1701057427 2985991923 ------------ 1284934496
Other current liabilities 422022704 662029260 ------------ 240006556
Short term provisions 730230 491481 238749 -----------

Total of B 4237026211 5701565463
Net Working Capital (A-B) 1773180611 2074083747
Increase in Working Capital 300903136 ---------- 3009033136 ---------
Total 2074083333747 2074083747 1586441749 1586441749
2050000000
2000000000
1950000000
1900000000
1850000000
1800000000 Series 3
1750000000
1700000000
1650000000
1600000000
2012-13 2013-14
G.F.G.C.W’S
Interpretation:
In the above analysis Net working capital in the year 2012-13 Rs.1773180611 and in the
year 2013-14 Rs. 2074083747 both we found that in the year 2013-14 there is increase in
working capital of Rs. 300903136 There is Increase in inventory and other current assets
are increased and current liabilities Decreased. So there is more inventories to meet the
day-to-day expenses.
Increase in working capital as compare to last year.
Statement’s Showing Changes in Working capital for the year 2013-14 & 2014-15
Particulars 2013-14 2014-15 Increase Decrease

A. Current Assets
Inventories 3092200521 3092200521 -------------- -------------
Trade Receivables 62964907 62964907 -------------- --------------
Cash& Bank Balance 65537451 65537451 -------------- --------------
Short Term Loans & 297302060 293376541 3925519
Advances
Other Current Assets 109476777 174842385 65365608
Total of A 3627481716 3688921805
B. Current
Liabilities
Short Term Barrowings 2053052799 2053052799
Trade Payables 2985991923 2985991923
Other Current 662029260 662029260
liabilities
Short Term Provisions 491481 491481
Total of B 5701565463 5701565463
Net Working Capital 2074083747 2012643658 61440089
A- B
G.F.G.C.W’S
Increase in working ---------- 770985376

capital
Total 2012643658 2012643658 709545287
2.05E+15
2.00E+15
1.95E+15
1.90E+15
1.85E+15
Series 3
1.80E+15
1.75E+15
1.70E+15
1.65E+15
2013-14 2014-15
G.F.G.C.W’S
Statement shows the changes in Working Capital For the year 2014-15 & 2015-16
A. Current
Assets
Inventories 3092200521 3180144205 87943684
Trade Receivables 62964907 251160 62713747
Cash& Bank 65537451 178166272 112628821

Balance
Short Term Loans & 293376541 55827824 237548717

Advances
Total of A 3688921805 3585969339
B. Current
Liabilities
Short Term 2053052799 2294739637 241686838

Barrowings
Trade Payables 2985991923 3423121347 437129424
Other Current 662029260 651150251 10879009

liabilities
Short Term 491481 587138 95657

Provisions
Total of B 5701565463 6369598373
Net Working Capital 2012643658 2783629034

A- B
G.F.G.C.W’S
Increase in working 770985376 770985376
capital
Total 2783629034 2783629034 143761336 143761336
3.00E+16
2.50E+16
2.00E+16
1.50E+16
1.00E+16
5.00E+15
0.00E+00
2014-15 2015-16
Interpretation:
In the above analysis net working capital in the year 2013-14 Rs. 2016346358
and in the year 2014-15 Rs.2783629034 and Increase in working capital of Rs.770985376. It is
due to Increase in inventory and other current assets are also Increased and current liabilities are
decreased. So there is more inventories to meet the day-to-day expenses.
G.F.G.C.W’S
Statement shows the changes in the working capital For the year 2015-16 & 2016-17

A. Current Assets
Inventories 3180144205 40687929792 888648587
Trade Receivables 251160764 121477380 129683384
Cash& Bank Balance 178166272 59584050 118582222
Short Term Loans & 55827824 44065121 11762703
Advances
Total of A 3836878943 4381346443
B.
C. Current
Liabilities
Short Term 2294739637 2452711170 157971533
Barrowings
Trade Payables 3423121347 3802280640 379159239
Other Current 651150251 959242140 308091889
liabilities
Short Term Provisions 587138 970109 382971
Total of B 6369598373 7215204059
Net Working Capital 3836878943 2833857616
A- B
Increase in working 1003021327 1003021327
capital
Total 3836878943 3836878943 1347202414 1347202414
G.F.G.C.W’S
4500000000
4000000000
3500000000
3000000000
2500000000
Series 3
2000000000
1500000000
1000000000
500000000
0
2015-16 2016-17
Interpretation:
In the above analysis net working capital in the year 2014-15 Rs.
3836878943 and in the year 2015-16 Rs.2833857616 and Increase in working capital of
Rs.1003021327. It is due to Increase in inventory and other current assets are also increased and
current liabilities are decreased. So there is more inventories to meet the day-to-day expenses.
RATIO ANALYSIS
G.F.G.C.W’S
Current assets
1) Current ratio: Current liabilities
Year Current assets Current liabilities Current ratio

2012 1843371442 1161170878 1.58
2013 247610173 1830279469 1.35
2014 3688921805 5701565463 0.65
2015 3586969339 6369598373 0.06
2016 438134643 7215204059 0.56
1.8
1.6
1.4
1.2
1
Current ratio
0.8
0.6
0.4
0.2
0
2012 2013 2014 2015
G.F.G.C.W’S
CHAPTER - V
G.F.G.C.W’S
Chapter – V
Finding and Suggestions
FINDINGS:
 In the year 2010-11 and 2011-12 there is increase in working capital, of Rs –
146836293.23. This may be due to increase in inventories and increase in other assets and
decrease of current liabilities
 In the year 2011-12 and 2012-13 there is increase in working capital, of Rs –
36378960.98. This may be due to increase in inventories and increase in other assets and
decrease of current liabilities
 In the year 2012-13 and 2013-14 there is increase in working capital, This may be due to
increase in inventories and increase in other assets and decrease of current liabilities
 In the year 2013-14 and 2014-15 there is increase in working capital, of Rs – 3871285994.
This may be due to increase in inventories and increase in other assets and decrease of
current liabilities.
 In the year 2014-15 and 2015-16 there is increase in working capital of Rs- 770985376. It
is due to increase in inventory and other current assets are also increased and current
liabilities are decreased. So there is more inventories to meet the day-to-day expenses.
 The net working capital ratio is in comfortable position the company has utilized the
working capital efficiency.
 Company should invest more increase net worth.
G.F.G.C.W’S
SUGGESTION:
The purpose of research is discovering answer to the question through the
application of scientific procedure the main aims of research is to find out the hidden truth and
which has not been discovered as yet.
 Company needs to improve its production to compete with competitor so that it can
capture major market.
 The company try to control on the high day to day expenses it may be help for the future
requirement of working capital
 The company needs to increase its current ratio by increasing its Current assets so it helps
to maintain standard form.
 Organisation arrange for training to employees.
G.F.G.C.W’S
CONCLUSION
Jamkhandi Sugars Ltd, Sugars (JSL) is one of the public limited in the field of
sugar cane production. After studying the working capital management I came to
conclude that this factory is working better in almost all field of management related to
finance, transportating etc. It has continued to adopt change to face compitation in the
market.
To day working capital is considered to be an important tool for progress.
Working capital management techniques are playing significant role in assisting the
management for decision-making . After the stud of working capital system a Jamkhandi
Sugar Ltd I found that there is ince=rease in working capital. In conclusion, it is efficient
in managing capital of the company.
G.F.G.C.W’S
BIBLIOGRAPHY
 Annual Report of the Industry
 Financial Report
 Reference Project as give by by factory of vijayalaxmi jadav
 JSL Info@Rediffmail.com
Books
 Financial Management - Baligar
G.F.G.C.W’S

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WORKING CAPITAL AT JAMKHANDI SUGAR’S LIMITED.

 PROFILE OF THE COMPANY

 DATA ANALYSIS & INTERPRETATION

The study of condected on the “STUDY ON CHANGES IN WORKING

The study concludes with view that,attitude of workers towords job is an

OBJECTIVES OF THE STUDY

weakness of the organization

 To study the sources of the working capital

 To provide large scale employment

 To calculate the operating cycle at Jamkhandi Sugars

NEED FOR THE STUDY

SCOPE OF THE STUDY

should from a significant part of it.

to collect the data.

LIMITATION OF THE STUDY

 The data is supplied by the company personnel.

 The study is concerned to only one factory.

conclusion and observation.

 Non availability of adequate data.

 It is very difficult to collect more information about finance.

 Busy schedule of the staff posed difficulty in collecting data.

 Time period of the study will be restricted.

given by the factory

THEROTICAL REPRESENTATION OF WCM

WORKING CAPITAL INTRODUCTION:

Since the efficiency of the working capital Management is determined by the

Concept of working capital

According to Qualitative Concept gives an idea regarding sources of financing

According to Quantitative Concept amount of working capital refers to ‘total of

According to L.J.Guthamann: Working capital as “the portion of a firm’s current

According to Gerestenberg: Circulating means current assets of a company that are

Working capital= Current assets-current liabilities

Need for working capital:

 To pay wages salaries.

 To incur day to day expense.

 For the purpose of Raw materials, components and spares.

 To provide credit facilities to the customers.

 To maintain the inventories of raw materials working in progress and finished

Sources of working capital:

 Loans from commercial banks

Classification of working capital :

There are two type of working capital they are:

1. On the basis of concept.

capital and net working capital.

o Net working capital: It is the excess of current liabilities.

working capital and temporary or variable working capital.

circulation of current assests.

o Temporary or variable working capital: Temporary working capital is the amount of

Factor determining the working capital:

Principal of working capital management:

o Principal of risk variation.

It establishes a relationship between quick or liquid, assests and current liabilities. An

3) Debtors Turnover Ratio:

The ratio measures the utilization of investment in debtors. Profitability of a firm is

4) Debtor’s Collection Period:

5) Net Working Capital Turnover Ratio:

6) Inventory Turnover Ratio:

Working Capital cycle/ Operating cycle

 Conversion of cash into raw material

 Conversion of raw material into work in progress

 Conversion of work in progress finished goods

 Conversion of debtors and bill receivable into cash

Calculation of Operating Cycle: