CHAPTER 1

1.1 INTRODUCTION ON BUDGETING

MEANING OF BUDGET

 A budget is the monetary and/or quantitative expression of business plans and

policies to be pursued in the future period of time. Budgeting is preparing
budgets and other procedures for planning, coordination and control of business
enterprise.

DEFINITION OF BUDGET

 I.C.M.A defines as budget as “a financial and/or quantitative statement,

prepared prior to a defined period of time, of the policy to be pursued during
that period for the purpose of attaining a given objective”.
 According to crown and Howard, “a budget is a predetermined statement of
management policy during a given period which provides a standard for
comparison with the results actually achieved”.

MEANING OF BUDGETING

 Budgeting refers to the process of preparing the budgets. It involves a detailed study
of business environment clearly grasping the management objective, the available
resources of the enterprise and capacity of the enterprise.

DEFINITION OF BUDGETING

 According to J.Batty “The entire process of preparing the budgets is known as

budgeting”
 According to Rowland and Harr “Budgeting may be said to be the act of building
budgets”

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 1.2 STATEMENT OF THE PROBLEM

Planning is essential in every type of company. Finance is the life blood of the organization.
Planning is very much important to forecast the financial performance of the company.
Preparing various budgets is very essential to forecast the future related activities of the
company from time to time particularly it is related to cost, sales & profit. To stand in the
competitive environment ever company has to prepare the budget in a effective manner without
any deviations.

Without preparing & following the budgets the company cannot predict their future outcomes.
To forecast the future cost, sales& profitability position of the company the budgeting is the
major key to take this as the base for this research.

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 1.3 OBJECTIVES OF THE STUDY

 Primary objective

 To study various budgeting and cost control techniques in kakkalur technokrat’s ltd.,

 Secondary objectives

 To study various budgeting techniques in Kakkalur technokrat’s ltd.

 To analyze previous years financial performance through budgeting
 To identify the financial strength and weakness of the company through budgeting
 To suggest ways to improve financial performance of the company.

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 1.4 NEED FOR THE STUDY

 It helps to know financial position of the company

 It helps to prepare future budgets.
 It helps to predict the future outcomes of the company

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 1.5. SCOPE OF THE STUDY

 Budgeting place a vital role in measuring the financial performance of an organization

 Budgeting techniques increase profitability position of the organization

 Budgeting is a major task to every finance manager in an organization since fiancé is

life blood of the organization

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 1.6 LIMITATIONS OF THE STUDY

The study of financial statement analysis on kakkalur technokrat’s pvt ltd, Tiruvallur is having
its own limitations as detailed below:

 Duration of the study for period of the one month is one the limiting factor for this
study
 The availability of data pertaining to five years is one of the constraints.
 Any change in the methods or procedures of accounting systems limits the utility of
budgeting.

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 1.7 Industry profile

Pathak machine tools pvt ltd

pathak Machine Tools Pvt Ltd is the manufacturer and dealer of Electronic
Diesel Fuel Pump Test Bench Machine. The Electronic Diesel Fuel Pump
Test Bench Machine falls in the category automobile garage machineries.

The Electronic Diesel Fuel Pump Test Bench Machine is an effective

machine for testing of diesel fuel injection pump functions of automobiles.
The salient features of Electronic Diesel Fuel Pump Test Bench Machine are
as follows:

• Available with capacities ranging from 6 to 12 Cylinders

• Machine fitted with Electric Controls such as: Push Buttons Starter,
Reversible Switch and no Volt overload relays within easy access of the
operator.

• Electronic Digital Tachometer is provided with the machine for accurate

counting of RPM up to 9999 +/- RPM.

• Accessories such as: Driving attachment for Rotary Pumps, Flexible Steel
Coupling & Heating Unit can also be provided with the machine on
demand.

Friendsco Engineering Works pvt ltd

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Diesel Fuel Pump Test Benches comes equipped with A.C frequency
controlled panel to attain infinitely variable speed from 0 to 3000 RPM in
both the direction. The Benches are equipped with Bi-directional swiveling
measuring console. The Benches are durable that ensures long lasting life.
The Diesel Fuel Pump Test Benches is capable of providing efficient
performance.

Key Features of Diesel Fuel Pump Test Benches

• Equipped with A.C frequency controlled panel to attain infinitely

variable speed from 0 to 3000 RPM in both the direction

• Equipped with Bi-directional swiveling measuring console.

• Durable

indraprastha Traders pvt ltd

Auto Electrical Test Bench is equipped with a 220V single phase 2HP 1440
RPM motor. The Test Bench is equipped with fixed load resistances of 5A,
10A, 20A and 40A to give a wide range of currents from 5A to 75A for 12V
alternators and 10A, 20A and 40A to give currents from 10A to 70A for 24
volts alternators. The Test Bench is made using quality grade material that

8
ensures good quality. The Auto Electrical Test Bench is durable that
ensures long lasting life.

Key Features of Auto Electrical Test Bench

• Equipped with a 220V single phase 2HP 1440 RPM motor.

• Equipped with fixed load resistances of 5A, 10A, 20A and 40A to give
a wide range of currents from 5A to 75A for 12v alternators and 10A, 20A
and 40A to give currents from 10A to 70A for 24 volts alternators

• Made using quality grade material that ensures good quality.

• Long lasting life.

Bosch pvt Limited

Motor industries co [mico] has developed a user friendly and compact, hi

tech auto electrical test bench, model h-s/efep 145. The test bench facility
enable easy, fast and accurate testing of wide range of alternators and
starting motors. The auto electrical test bench are easy to operate with two
running speeds,to ensure thorough testing both at higher and lower speeds.
The model h-s/efep 145 also include vacuum testing and is ideal for
functioning at a workshop. The salient characteristics include table top
model, built in power source for free run testing of starter motor [no
requirement of external battery], capable of testing 12/24 system, with

9
digital ammeter/voltmeter for easy reading, provided with vacuum testing
arrangement and 6 v dc for testing excitation winding and 40/80 v ac for
testing shorting of armature/stator/rotor. The h-s/efep 145 are available
with technical specifications such as 2.2 kw drive motor capacity, 3-phase
and 415 v supply; 12/24 v starter motors up to 150 a free running current
and 14 v alternators up to 120 a capacity and 28 v alternator with up to 75 a
capacity can be tested; vacuum pump alternators up to 730 mm hg can be
tested. These models come in 900 [l] x 750 [b] x 550 [h] dimensions [mm]
and 120 kg weight.

ELAK AUTO ELECTRICAL TEST BENCH FOR TESTING

ALTERNATORS AND STARTERS PVT LTD

ELAK introduces user-friendly, hi-tech Auto Electrical Test Benches.

Highly compact, the test bench facility enables easy, fast and accurate
testing of Alternators & Starter Motors. The Test Bench can be operated at
2 speeds, ensuring thorough testing both at higher & lower speeds.
Extremely easy to operate, the test bench is an ideal addition to your
workshop.

Mark - I (Single Phase)

Features :-

Drive 2 H. P. Single Phase

Power Supply 220V 15 AMP

Alt. Load 75 Amp-12V & 75 Amp-24V

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Starter Test Built-in D. C. Supply

Mark - III (Three Phase)

Features :-

Drive 3 H. P. Three Phase

Power Supply 440V 15 AMP

Alt. Load 130 Amp-12V & 80 Amp-24V

Starter Test Built-in D. C. Supply

Both the Model have following features : -

INSTRUMENTATION

Digital Panel Meters 0-200 Amps & 0-200 Volts

PROTECTION

Circuit Beakers & Fuses

VICE

Heavy Duty Fast Mounting vice for Alternators & starters. Maximum dia of
device under test 175 mm.

the Central Illinois. We service all makes models of cars, trucks,

construction, farm, marine, and aircraft ground support vehicles.

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Additional Features: -

1. Built-in A. C. Voltage Stabilizer

2. Easy transportable-Bench top model

3. Fixed 12 / 24 V Field Supply

4. Alternator Fault light 12 / 24 V

5. Starter test free-run (on built-in D. C. supply-no battery required)

6. Full set of leads

7. Working area covered with a rubber mat

8. Separate digital meters for alternators / starter test

9. A 110 V Series lamp for insulation test.

SAMMY AUTO ELECTRICAL PVT LTD

Serving C-U’s auto electrical needs since 1979Sammy’s Auto Electric is a

locally owned and operated small business. It is owned by Mohammad and
Colleen Samii. Sammy’s has been a part of the C-U community since it
opened in June of 1979 We rebuild alternators, starters, generators,
cranking motors, hydraulic pump motors for all applications. Heavy Duty,
industrial, agricultural units as well as all light duty applications (domestic
and imports) are our specialty. We specialize in charging /starting system
diagnostic and repair and provide complete auto electric service such as
repair of wiring as well as replacement of switches, control modules and

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dash components. Sales and service of Interstate Batteries as well as all
types of voltage regulators, solenoids and power relays is also an integral
part of our business. We perform unit analysis report for a variety of large
national and some international remanufacturers. The owner (Mohammad
Samii) is APRA's electrical division trainer and coordinator of electrical
training where he performs regular clinics for the organization and is
involved with technicians training program for a few national and regional
electrical remaunfacturer.

Our Facility

We have a modern 6500 Sq.Ft facility with 8 bays that can accommodate
larger vehicles. We have computerized state-of-art alternator and starter
test benches that analyze a variety of component parameters and issues
performance reports along with PC based scope (Pico) and Scan tool (Ease
& Auto Enginuity). We are a member of APRA (automotive Parts
Remanufacturers Association) as well as SAE and are ASE certified.

DIMENSION

900 (L) X 750 (B) X 550 (H) m

Ampro industries pvt ltd

13
By considering the ever changing requirements of industries, we are able to
manufacture and supplying a highly advanced line of CRDI Test Bench.
The offered test benches are especially assembled for the testing purpose of
injector, diesel common rail high pressure pump and rail tester. Further,
our gamut of CRDI Test Bench is suitable to diagnose the mechanical
operation performances along with electrical coil conditions.

Features:

• High in functionality

• Fine measurement properties

• Extended service life

Further Details:

Ampro EPI-1

Diesel Common Rail High Pressure Pump, Injector & Rail Tester

For the testing and cleaning of Common Rail High Pressure Injectors with
air operated high pressure pump.

Key Diagnoses:

• Diagnose Mechanical Operation Performance

• Diagnose Electrical Coil Condition

• Measure Back-Leak Quantity

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• Diagnose Spray Pattern Performance

• Measure Delivery Quantity at different pulse width

• Simulates with your old test bench

Supported Injector Manufacturers and Types:

• Bosch

• Delphi

• Denso

Features:

• Spray Pattern Testing

• Volumetric Testing

• A special Nozzle Adapter is used to precisely measures the sprayed

quantity.

• Easily connects to your old test bench.

Control Panel:

• Electrical coil diagnosis.

• Large, bright graphic display.

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• Fully programmable (CPU) control panel for future updates and for
test-plans.

• A user-friendly menu.

Additional features includes:

• Pressure regulator for adjusting the rail pressure.

• Analog pressure gauges.

• Stylish enclosure designed for bench top use.

• Single pulse generator for precise spray monitoring.

• Dynamic engine running simulator.

• Simulates the common rail high pressure system with conventional

diesel fuel injection test benches.

• Simulates up to four injectors at one time.

Operating range:

• Injector operating frequency:2-99 Hz

• Injector pulse width:10 - 9,990us with 10 us increment.

• Operating Stoke:1- 9,999 with precise 1 stroke increment.

• Injector pulses:1-9,999 stroke (with single stroke option)

• Diesel Pressure:0-2000 bars

• For the testing and cleaning of Common Rail High Pressure Injectors
with air operated.
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 1.8 COMPANY PROFILE

Established in the year 2005, we are one of the professionally managed organizations, engaged
in manufacturing and exporting of electric panels and other automation equipment. Moreover,
the hard work and sincerity of ours has led us achieve the prestigious ISO 9001:2008
Certificate, which has brought our company to new heights of growth and prosperity.

Our product range includes Auto Electrical Diagnostic Equipments, Computerized Alternator
Test Equipment, Fuel Injection Pump Test Bench, Automobile Electrical System, Alternator
Test Rigs, Starter Test Rig, Automobile Electrical Parts Testers, Starter Test Bench, Alternator
Test Bench, Diesel Fuel Pump Test Bench, Control Panel, ETP Panels, Furnace Control
Panels, RO Panels, PLCC Panels, MCC Panels, APFC Panels, SCADA Based Control Panels
and many more.

Operating in the industry since a long time, we have gained industry experience and are
committed to offer our clients the products as per their requirements. Keeping pace with the
time we have ensure to adopt newer technologies so as to deliver a superior range of products,
which meet the international standards of quality, functionality and reliability. Leveraging on
latest technology, we are the pioneers to have designed a compact auto-electrical test bench.

Company Profile

Basic Information

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Business Type

• Manufacturer

• Exporter

• Supplier

• Service Provider

Key Customers

• BOSCH Limited, Chennai, Tamil Nadu

• Lucas-TVS, Chennai, Tamil Nadu

• ICAT, Chennai, Tamil Nadu

Industry

Auto electrical test equipments

Registered Address

Plot No. 42, Senthil Nagar, Neelankarai Canal Road, Seevaram, Perungudi, Chennai,
Tamil Nadu - 600 096, India

Ownership & Capital

Year of Establishment

2005

Legal Status of Firm

Proprietorship Firm

Proprietor Name

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 Mr. B. K. Muralidaran

Trade & Market

Annual Turnover

• 2010-11 Rs. 2-5 Crore Approx

Infrastructure

Location Type

Urban

Building Infrastructure

Permanent

Size of Premises

2,500 square feet

Team & Staff

Total Number of Employees

11 to 25 People

Statutory Profile

Income Tax Registration No.

AHZPM9425F

Central Sales Tax No.

847662C

TIN No. / VAT No.

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 33210924677V

Import Export Code

0407014683

Banker

• Lakshmi Vilas Bank

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 1.9 PRODUCT PROFILE

Testing Equipments and Automation Control Panels Share:

We - Technokrats are engaged in manufacturing a wide range of Testing Equipments

and Automation Control Panels. With the help of our in-depth industrial knowledge and
state-of-the-art manufacturing unit, we are able to provide complete satisfaction to our
esteemed customers in term of quality as well as efficiency. Our range includes
Alternator Test Rigs, Starter Test Rig, Solenoid Test Rigs, Fip Test Bench, Automobile
Electrical System, Furnace Control Panels, MCC Panels, UF/RO Panels, ETP Panels,
PLCC Panels, Drum Mix Panels and APFC Panels and many more.

Auto Electrical Diagnostic Bench

We are a Leading Manufacturers, Suppliers & Exporters of Auto Electrical Diagnostic

Bench. We provide one of the best Auto Electrical Test Equipments. All Auto Electrical
Sub Parts are tested to the standards OEM specification. We also offer various types of
small testers to be used in automobile garages and battery manufacturers. Two wheelers
batteries testers are designed in smaller models. Battery chargers cater to charging of
single battery to maximum of 10 batteries with microprocessor base charging with closed
loop monitoring so that the battery is cut off automatically after it is fully charged.

Test Rigs - Alternator

Starter Test Bench

Starter Test Rig

Auto Electrical Part Testers

Fuel Injection Pump Test Bench

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Diesel Fuel Pump Test

Alternator Test Bench

Technokrats has developed Alternator Test Bench to test the speed against voltage
performance of the alternator motors.

The alternate test bench consists of electronic instrumentation to capture voltage,

current, load readings along with motor rpm.

Alternator Test Bench

Computerized Alternator Test Bench

Touch Screen Test Rig

Autoelectrical Test bench

Alternator Starter Test Rig

Automobile Lab Test Equipment

Alternator Test Equipment

Starter Test Rig

Alternator Starter Test Bench

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Control Panel

We also provide electrical control panels which can be used for varied processes and in
various industries. Our range of control panels is available in different models and
operating capacities to suit various applications. We design and manufacture control
panels for hydro pneumatic systems. These control panels are appropriate for all types of
Hp working,

PLCC Panels

MCC Panels

SCADA Based Control Panels

ETP Panels

Furnace Control Panels

RO Panels
AFC Panels

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 2.1 REVIEW OF LITERATURE

A brief review of literature would help the researcher, reader and other research scholars in
gaining an insight into the studies, which were made in areas related to the subject of this
study. The findings of some of the studies are briefly summarized as follows;

Budgeting

According to (Merchant, 1982). Merchant a budget is a result-oriented control system. This

form of control involves holding employees responsible for certain results. This type of
control is future-oriented and means that targets have to be set by management and that
employees have to be motivated to reach these targets.

According to Horngren, Sundem and Stratton there are three major benefits of budgeting
(Horngren, 2005):
1. Budgeting compels managers to think ahead by formalizing their responsibilities for
Planning.

2. Budgeting provides definite expectations that are the best framework for judging
subsequent
Performance.

3. Budgeting aids managers in coordinating their efforts, so that the plans of an organization’s
Subunits meet the objectives of the organization as a whole.
Horngren further states that a budget is a tool that aids managers in both their planning and
control functions.

Vosselman gives the following definitions for a budget (Vosselman et al., 2008):

• A budget is a leather suit case, a ‘pouch’;

• A budget is more than a plan and more than a co-ordination device;
• A budget is a performance contract (connected to financial targets and incentives and often

24
 Connected to individual compensation);
• A budget is a constraint as well as a device for empowerment.

The origin of the word budget is the Latin bulga, a little pouch or knapsack, which may have
come from a Gaulish source that is related to the Irish blog, “bag”. The word turned up in
English in the fifteenth century, having traveled via the French bougette, a diminutive form of
bouge, “leather bag”. Its first meaning in English indeed was “pouch, wallet, bag”, and
followed its French original in usually implying something made of leather. By the end of the
sixteenth century, the word could refer to the contents of one’s budget as well as to the
container itself. this in the figurative sense of a bundle of news, or of a long letter full of news,
and the word formed part of the name of several defunct British newspapers, such as the Pall
Mall Budget. The connection with finance appeared first only in 1733, as the result scurrilous
pamphlet entitled The Budget Opened. The allusion was that the government minister
responsible for financial affairs opened his budget, or wallet, to reveal his proposals. It
probably also echoed the Idiom to open one’s budget, “to speak one’s mind”, which was
current then and continued to be so down into Victorian time. If he survived a few years, the
pamphlet writer must have been chagrined to see his intended victims expropriate his satirical
term and turn it into political jargon. By the1760s, it was clearly well established, and has
been the standard term ever since. But it was only in the 1880s that it began to be used as a
verb in the sense of planning one’s expenditure, and the attributive meaning of “inexpensive;
suitable for someone of limited means” was first recorded only in 1958

Budgets help managers plan for the future. However, managers also use them to evaluate what
happened in the past. They use budgets as a benchmark – a measure of estimated or desired
performance – against which they compare actual performance. Business owners and
managers need to budget their resources – which include everything from raw materials to
human resources to facilities – to make the best and most profitable use of what they have to
work with.

25
Budgets highlight potential problems and advantages early, allowing managers to take steps
to avoid these problems or use the advantages wisely. All managers do some kind of planning
Review of literature

All anticipated costs should be covered. Refer to the Developing Budgets section for more
guidance.

Because a clinical trial contract is a fixed-price agreement, you are obligated to perform the
work described in the contract, even if your actual costs exceed the total contracted amount.
Also, in most cases you receive payment as milestones. Often costs are incurred costs without
reaching a milestone. Therefore, a clinical trials budget focuses more on the milestones. A
standard budget format can be found on the .

In developing the clinical trial budget, you should estimate the number of patients that may be
enrolled in the study and multiply that by the milestone payments of each patient. This will
estimate the revenue planned for the study. Then, estimate the expenditure budget based on the
overall costs of delivering the study. Most clinical trial agreements provide for number of
payments associated with the start-up of the study. These costs are normally; 1) an IRB fee,
2) a pharmacy set-up fee, 3) a CTO fee, etc. This process ensures that regardless of the
patient enrollment, WSU will receive reimbursement for costs it did incur.

Most proposals span a number of years. It is important that in the development of the budget a
provision for the “inflation” is used in order to appropriately plan for increased costs. WSU
recommends using a 3% inflation factor for subsequent years. Any significant increases or
decreases, and budgets with increases above the standard rate must be justified. Contact your
GRANT AND CONTRACT OFFICER in SPA to find out if the sponsor has a predetermined
increase.

Materials and supplies encompass all consumable or disposable items. Included in this
category are lab supplies, chemicals, etc.

26
Laboratory animal purchases are normally put in this category. List the animal species and
numb
 

The university defines capital equipment as moveable items with useful lives of more than one
year and costs of $5000 or more per unit (items not meeting this definition should be listed as
supplies in the budget).

The budget should list the specific equipment items and their estimated purchase or lease
costs. Shipping and installation should be budgeted. If installation involves substantial
structural changes, these costs should be budgeted as renovations and alterations. Maintenance
costs of equipment already available to the researcher can be budgeted under the Other
Category of the budget.

There are two types of equipment:

 General purpose equipment refers to items not limited to scientific or other technical
use. Examples of this type include office equipment, office furnishings, computers, etc.
General purpose equipment typically is used for multiple activities so it is
inappropriate to charge its entire cost to a single project. If it is determined this type of
equipment is required, the need should be fully explained in the budget justification.

 Specialized equipment can be used only for specialized scientific or technical purposes
and is allowable if it is needed to conduct the project. The need should be fully
explained in the budget justification.

The cost of conducting projects can be categorized in two ways: as direct costs, or as indirect
costs, which are referred to as facilities and administrative (F&A) costs.

Direct costs are defined as "those costs that can be identified specifically with a particular
sponsored project relatively easily with a high degree of accuracy." For example, the purchase
of a chemical reagent for a specific experiment is a direct cost to the project. Direct costs must

27
be reasonable - what a prudent person would spend; allocable - limited to that portion of
expenses directly benefiting the project; and consistently treated by the university as direct
charges.

By contrast, F&A costs are defined as "those that are incurred for common or joint objectives."
In other words, F&A costs are costs that cannot be specifically attributed to an individual
project. Examples of F&A costs include the services of the accounting staff, the cost of a roof
or utilities for a building housing several research projects, office supplies, postage, local
telephones, or salaries of personnel engaged in providing a broad range of departmental
support activities.
When preparing a proposal budget, the F&A costs are expressed as a percentage of the direct
costs of the project. The appropriate rate and basis to be used is driven by two characteristics
of the program. First, you must determine if the project is conducted “on-campus” or “off-
campus”. The driving factor here is where is the majority of costs incurred. (Note: the costs
refer only to the WSU costs; if there is one or more subcontractors, their costs should be
ignored.)
After that determination is made, the second factor in determining the appropriate F&A rate is
the classification of the activity to be undertaken. There are three possible classifications: 1)
Instruction, 2) Research, and, 3) Other Sponsored Activity. These classifications, as defined
by the Federal government, are a follows:

 Instruction means the teaching and training activities of an institution. Except for
research training as provided in subsection b, this term includes all teaching and
training activities, whether they are offered for credits toward a degree or certificate or
on a non credit basis, and whether they are offered through regular academic
departments or separate divisions, such as a summer school division or an extension
division. Also considered part of this major function are departmental research, and,
where agreed to, university research.

(a) Sponsored instruction and training means specific instructional or training

activity established by grant, contract, or cooperative agreement. For purposes of

28
 the cost principles, this activity may be considered a major function even though
an institution's accounting treatment may include it in the instruction function.

(b) Departmental research means research, development and scholarly activities

that are not organized research and, consequently, are not separately budgeted and
accounted for. Departmental research, for purposes of this document, is not
considered as a major function, but as a part of the instruction function of the
institution.

 Organized research means all research and development activities of an institution that
are separately budgeted and accounted for. It includes:

(a) Sponsored research means all research and development activities that are
sponsored by Federal and non Federal agencies and organizations. This term
includes activities involving the training of individuals in research techniques
(commonly called research training) where such activities utilize the same
facilities as other research and development activities and where such activities
are not included in the instruction function.

(b) University research means all research and development activities that are
separately budgeted and accounted for by the institution under an internal
application of institutional funds. University research, for purposes of this
document, shall be combined with sponsored research under the function of
organized research.

 Other sponsored activities means programs and projects financed by Federal and non
Federal agencies and organizati0ons which involve the performance of work other than
instruction and organized research. Examples of such programs and projects are health
service projects, and community service programs.

Once the determination of the appropriate rate had been made, it should be included in the
budget. Remember, some programs have restriction on the amount or rates that can be used.

29
Check the sponsor's guidelines or consult with your Grant and Contact Officer to understand
any

The rate that is used at the time of the application is utilized for the entire award period
regardless of the changes in a subsequent year or budget period.

Some programs are specific to providing funding only for trainees or participants. The term
TRAINEE is used to refer to WSU-enrolled students who are receiving support from the
sponsor. An example of this is National Institutes of Health (NIH) trainees who receive
support as they continue their studies or residencies. The term PARTICIPANTS is used to
refer to non-university individuals who receive support. An example of this would be an
individual receiving support to attend a conference or professional development workshops. In
either case, a budget line should be listed for the different type of support they may be
receiving. In the case of trainees, types of support would include stipends, research supplies,
tuition, travel and health care benefits. Participants often receive travel and subsistence
support on a regular research grant. In both cases, be sure to read the program guidelines to
understand amounts available for support.

Most funding agencies issue various forms of proposal solicitations that can be called requests
for proposals (RFPs), request for applications (RFAs), program announcements (PAs) or
funding opportunities announcements (FOAs). Whatever term the agency uses, the solicitation
is a researcher’s point of reference for the entire proposal development process. Most
solicitations include a variety of items such as: the goals and objectives of the agency; scope
of the project; general and specific topics to be addressed; budget requirements; outcomes;
eligibility requirements; timelines and deadlines; and review criteria. Most agencies require
clear compliance with every element of the solicitation in order to justify review of a proposal;
many are rejected by agencies even before they are evaluated on the basis of not following the
solicitation requirements. If aspects of a solicitation are unclear, a researcher can often
communicate with a designated program officer or another individual responsible for fielding
questions.

30
In addition, some solicitations may limit the number of proposals that an eligible institution
may submit. This limitation can be inserted by: 1) limiting the number of proposals from any
given entity, or 2) requiring a preliminary proposal or letter of intent. If you encounter a
solicitation that limits the number of proposals an institution can submit, go first to WSU' web
site. Funding opportunities with limited submissions are coordinated internally by the Office
of the Vice President for Research and an internal deadline for submitting an abstract should
be listed on the website. If you do not see your funding opportunity listed, and include a link
to the funding announcement in your e-mail. If the solicitation requests a preliminary
proposal, usually a shorter version of the proposal, the deadline is typically months prior to the
full proposal deadline. Sponsors review these and then reduce the number of applications
eligible to submit full proposals.

Reading a program solicitation for the first time can be overwhelming. However, by planning
early, developing clear timelines and creating content outlines using the solicitation as a guide
for writing, the process is manageable.
 

Cost sharing consists of the portion of the total costs of a sponsored project that is born by
WSU or a third party. These funds are generally contributed from the department's general
fund, an indirect cost return fund or other non-restricted funds identified by the appropriate
department personnel. Funds obtained under another research project (grant or contract) are
generally not allowed for use to meet cost sharing obligations.

Major types of cost sharing obligations and how they differ

The major types of cost sharing are mandatory, voluntary committed and voluntary
uncommitted. The following provides a brief explanation of each:

Mandatory - The funding agency requires the university to contribute funds to

accomplish the goals of the research project. The mandate is typically stated in the
Request For Proposal (RFP). The researcher must specifically state the cost sharing
details in proposal documentation.

31
 Voluntary Committed - Although the agency does not require cost sharing, the
university has indicated that it plans to either contribute effort or other funds, to aid in
the accomplishment of the research goals. If the university includes this commitment in
the proposal documentation, the university must adhere to it and track it separately in
the financial management system. The commitment may either be found in the budget,
or within the budget justification or a project narrative.

Voluntary Uncommitted - The department plans to contribute effort or other funds, to

the project but the obligation was not stated in the proposal submitted to the agency. The
university is not required to track this obligation separately in the financial management
system.

How are cost sharing expenses recorded, reported (when appropriate) and reconciled?

Recording and Reconciling - The university is required to track both mandatory and
voluntary committed cost sharing obligations in the financial system. Funds are
established in Banner by SPA's grant and contract officers. Budgets are funded,
reconciled and updated by SPA's accounting services group.

Reporting - In most cases, agencies that require a mandatory cost sharing obligation,
also require the university to report those costs on a periodic basis. This way, they are
given assurance that the university is contributing as stated in the proposal. Cost sharing
expenditures are reported to the agency via the Financial Status Report (FSR). The FSR
is completed by SPA's financial team and/or billing group.

• Fund establishment - grant and contract officers

• Budget funding, updating, reconciling and account termination - SPA accounting services
group
• Reporting - SPA's financial team and/or billing group.

Please take note of a few important process revisions that have taken place:

32
• Drafts of the verification forms are emailed to department representatives for validation. SPA
allows 15 days to confirm the information or recommend changes. If the department does not
respond within the period allotted, the cost sharing fund is funded using the information
provided to the department in the draft.

• Once the entry has been completed to fund the budget, a finalized copy of the verification
form will be imaged and available to view via the Researcher's Dashboard.

Who in SPA to Contact for Cost Sharing Inquiries/Concerns?

SPA's accounting services group has been established to address the research community's
questions or concerns relating to grant/contracts. If there are general questions concerning
these funds, contact any member of this team and they will assist you.

If there are specific questions concerning expenditure reporting, contact a member of the SPA
financial team. Questions concerning fund establishment can be directed to your grant and
contract officer.

Hopefully at the time you decided to go forward with your proposal submission, you also
notified your Grant and Contract Officer (GCO) of your intent (see link to the right to identify
your GCO).

Some agencies require institutional and/or individual registration if you intend to apply for a
grant, as is the case with many federal agencies. You may request individual login access or
reactivate your login to NIH and/or NFS agency by clicking on the respective link: Note: this
process can take anywhere from 3-5 days if Institutional registration has not already been
obtained. Additionally, you will need to download the appropriate software system
requirements for your PC or MAC or higher, and to allow you and your GCO to submit your
to verify if your Adobe software version is compatible with Grants.gov.

WSU utilizes an internal electronic submission process through . This process requires all
proposals, with their requisite approvals and signatures, to be submitted electronically to
WSU's

33
All funding agencies require some level of institutional approval of applications they receive.
Most agencies, especially federal ones, require approval from the university's Authorized
Official(AO). At WSU, our AO is your Grant & Contract Officer (see link to the right to
identify your GCO); however, there are some agencies that may require a department and/or
dean’s signature in addition to the Authorized Official (GCO) or only a departmental chairs
and/or a dean’s signature. In these cases, it is best to contact your GCO for procedure and
approval.

Since involvement in a sponsored project requires personnel time, departmental space and
resources, and possible compliance and regulatory issues, all department heads for the key
personnel, whether paid or not, and the deans or a designee of all participating units must
review and approve the proposal through eProp/COEUS. This routing occurs electronically
and automatically within eProp/COEUS.

Personnel who have approval responsibility should regularly check their inbox. See for more
information on how to retrieve, review and approve proposals. To ensure efficient handling of
these proposals, every approver must have at least one alternate approver. Proposals in process
are routed to both primary and alternate approvers.

Completion of a successful proposal involves the cooperation and interaction of a range of

university staff, and external institution staff if a consortium is involved. It is critical that staff
keep one another informed and involved in proposal processing. These roles and
responsibilities may vary between academic departments, centers and institutes, and schools
and colleges.

No application may be submitted to any external sponsor without the prior approval of the
university.The signature of the institution's authorized official (AO) is necessary to show
university compliance with sponsor and government regulations, acceptance of responsibility
for the administration of the sponsored project, including the provision of adequate facilities
and services, and compliance with applicable university policies and procedures.
Authorization may also represent pre-acceptance of terms and conditions of an award. The

34
WSU Board of Governors has authorized the Vice President for Research to designate
signature authority on sponsored projects to the Office of Sponsored Program Administration.

 Assists the Principal Investigator (PI)/Project Director (PD) with all

budgetary/administrative components of the application
 
 Reviews cost sharing commitments and prepares necessary cost share supporting
documentation
 
 Reviews proposal format requirements, page limitations, etc. with the PI/PD and/or
other administrative support staff
 

What should you do during the several months duration in which the funding agency goes
through the process of reviewing your proposal and obtaining peer review on the proposals
submitted? We provide you with two sets of advice: one from faculty and one from our
Research Compliance Office. Both are important, and can be accessed by viewing the drop-
down menu on the left.

In addition, if you are interested in viewing previous Professional and Academic Development
Seminars on what takes place during an NIH or NSF review process, please see the Relevant
Links bar on the right

What if I don’t get funded?

If you applied for a grant from NIH or NSF, don’t be discouraged if you do not get funded on
the first try or even your third or fourth try! National funding is very difficult to achieve and it
may take several tries. NIGMS reports a success rate (that is,” the percentage of reviewed
research project grant applications that receive funding”) to be approximately 29%. NINDS
reports a success rate of 11% for new investigator applicants applying for a R21 grant versus
19% for new investigator applicants applying for a R01 grant. NIDDK reports a success rate
of 16% for new applications and 42% for renewal applications (average of approximately

35
21%). NSF states that in one of the divisions of the engineering directorate, the CAREER
award success rate is about 15%.

What do you do if a founder declines to provide funding? We suggest several strategies:

Don’t get angry or discouraged as you read the comments of the reviewers. Don’t
respond immediately – or alternatively, type a response if you need to vent, but don’t
send it.
 

When you’ve calmed down, re-read the reviews carefully. Waiting a few days is
appropriate, but waiting a few months may deprive you of the courage to deal with the
issues.
 

It’s a good idea to have an experienced grant writer review the comments from the
funding agency. Someone who has been through both writing and review committee
experiences can better understand the nature of the criticism and provide an in-depth
explanation of what the reviewer is saying.
 

Some faculty recommend reading the reviews alongside the proposal. They’ll read one
comment at a time, go to the corresponding section of the proposal and re-read that
portion with an open eye. Might the reviewer be correct or even partially correct? Did
the reviewer point out something that you might not have thought about, or might have
thought about but did not address adequately? Did she/he misinterpret something
because it wasn’t quite clear in the proposal? Remember that this is a learning process
and think of the comments as a helpful guide to improve your next proposal.
Therefore, don’t take the comments as a personal attack on you. The reviewers may be
blunt in their assessment, but their job is to detect inconsistencies and logical or
methodological flaws, question assumptions and demand perfection.
 

36
 If the founder declined to review your application, you might want to contact your
program officer to see if you can obtain information on what happened. If reviewers
found major flaws, you’ll have to correct them and will probably need to re-submit
your proposal at another agency. If your program officer can’t provide tangible advice,
it helps to have a mentor or someone else in your department go over the proposal and
help discern what might be problematic.
 

Occasionally, we hear faculty opine that a review panel did not have sufficient
expertise to provide an appropriate review. Did that happen despite the fact that you
read carefully the agency’s mission statement for congruence with your research topic
and talked to the program officer before submitting the proposal? If so, a friendly call
to your program officer might be helpful. If not, take the time to contact the program
officer (via e-mail) and ask for an appropriate time for you to call to ask questions your
research topic and how appropriate it sounds to the agency’s mission.
 

Did your mentor or a group of faculty review your grant before you submitted it? If
they did and could not find anything to correct, think about finding someone who is a
bit more discerning who can offer helpful advice. The Office of the VP for Research
will help identify a mentor if you can’t find one. Contact Sarah James
(sjames@wayne.edu) for more information. It will be very important to have your next
submission reviewed before it is submitted, and for you to be able to explain what you
did to respond to the reviewers’ comments.

When a researcher initiates a research project she/he must be aware of, and comply with, an
array of federal, state and university regulations regarding a variety of issues such as research
integrity; conflict of interest; and use of human subjects, vertebrate animals, biohazardous
materials, radioactive materials and controlled substances. Other projects involve legal issues
regarding intellectual property and patents. This section discusses some of these issues and
provides guidance as to how to assure that a research project meets all reporting requirements.

37
 First and foremost, there is a project to be completed based on the proposal which was
awarded. The award document functions as the framework under which the project should
be completed.  It should identify the required reporting (technical and financial) outline the
rules and guidelines that govern the project. It is incumbent on the PRINCIPAL
INVESTIGATOR and their staff that they understand the agreement and execute the work
under these guidelines

The programmatic management section encompasses program changes, non-financial

reporting, and roles and responsibilities. You will also find tutorials for Researcher's
Dashboard (see Relevant Links to the right), an easy-to-use intuitive tool that streamlines and
enhances the pre-award and post-award grant processes for both researchers and
administrators. 

Most sponsored program agreements, regardless if they are a grant, contract or other type of
agreement, have a number of reporting requirements throughout the life of the agreement.
Fulfilling these reporting requirements is one of the responsibilities WSU agrees to when it
accepts funds to complete the work. Therefore, it is critically important for the success of the
project, the relationship with the sponsor and the reputation of the university that effort is
expended to meet these obligations.

The most common of these reports are:

 Technical or Progress Reports

The Principal Investigator (PI)/Project Director (PD) is responsible for promptly submitting
any required technical or progress reports. The sponsor’s award notice or contract specifies the
required frequency of reports and the sponsor's expected dates. Inform the sponsor promptly of
any delays. Before drafting a report, review the award terms and sponsor policies to see if a
specific report form or style is required. Failure to comply with reporting requirements could
result in withheld or incomplete payments from the sponsor. The Principal Investigator

38
(PI)/Project Director (PD) and departments are responsible for covering payments not received
because technical or progress reports were not appropriately submitted.

 Invention Reports

Any invention conceived or first brought to practice that is related to the inventor’s work
assignment or was invented using university resources is owned by the university and subject
to any rights of the sponsor. Inventors have obligations to report these inventions to the
university and the sponsor. A Principal Investigator (PI)/Project Director (PD) should
coordinate this disclosure with WSU's Technology Commercialization (TC) office (see the
Relevant Links bar on the right).

Through the course of the project, there may be a situation that arises that was not planned for
during the proposal development. In general, any substantial deviation from the agreed-upon
project probably needs prior approval from the sponsor. However, all awards have their own
set of guidelines so it is necessary to understand the rules governing your specific award. You
can check the award document, the sponsor's policy guidelines, or contact your Sponsored
Program Administration Grant and Contract Officer (see the Relevant Link bar on the right to
identify your officer) if questions arise.

Many of the changes that occur in the course of a project can be handled internally. In many
cases, the university has been delegated authority to approve certain changes. These changes
need to be coordinated with the Sponsored Program Administration office so be sure to
communicate these situations prior to their occurrence. 

The below rules are general guidelines when administering awards from our federal sponsors.
These are monitored and published by a federal work group. To obtain the latest set of rules,
please review.

Remember that all sponsors provide guidelines at the program and grant level. You should
always check with your Sponsored Program Administration Grant and Contract Officer for
advice regarding changes.

39
Below is a list of program/project changes for which WSU may retain authority to approve, all
related to re-budgeting among budget categories, including direct and indirect categories:

1. Re-budgeting of funds allotted for training allowances

2. Capital purchases not in approved budget
3. Alterations and renovations less than $25,000
4. Foreign travel not listed in the approved budget
5. One time no cost time extension, not greater than one year

However, there are some changes that require the approval of the sponsor. Again, these
changes need to be requested in advance of the change and should be coordinated. It is
important that the request and subsequent approval comes from the appropriate sponsor
representative. Often, a program manager may “endorse” an activity; however, in most cases,
approval must come from the appropriate grant official.  

Once you have identified your niche (your unique contribution), it is important to
identify the long-term goal you have within that niche area. Think broader than what
you can achieve with a single grant, but be realistic so that the goalcan be accomplished
within your career. Think in terms of a continuum of research and plan logical steps
needed along the continuum.

Think of a problem that could be solved through one awarded project - an idea that can
contribute something new within the context of your field. The idea is your launching
off point. Getting funded starts with a good preliminary idea and a vision of a step by
step long-term process that your one-grant idea will build upon.

Foundations usually do NOT support ongoing programs, provide operating funds, or fund
projects for more than a three to five-year period. Once potential foundation support has been
identified, the preferred initial approach is through a letter of preliminary inquiry, which
outlines the project briefly and asks if the foundation's interest is sufficient to receive a formal
proposal through official university procedures. Personal contact with foundation officials is
often helpful.

40
Go first to WSU's Corporate and Foundation Relations (CFR) office before contacting any
private funders. The CFR office is responsible for the coordination of all private corporate and
foundation funding requests on behalf of the university, and collaborates closely with
Sponsored Program Administration to ensure appropriate accountability. A team of prospect
researchers, writers and CFR directors can help plan fundraising strategies, find prospective
funders, write/edit letters and proposals, develop budgets, and set up accounts and fulfill
reporting requirements. For more informati

To allow faculty and students easy access to information about research funding opportunities
available through these university units, the Office of the Vice President for Research annually
compiles the .

41
 3.1 RESEARCH METHODOLOGY

Research

Research is the process of findings solutions to a problem after a thorough study and analysis
of situational factors.

Research design

A research design is a plan, structure and strategy of investigation. So convinced to obtain

answers the question to the research problems. The plan is the complete scheme or program
of the research.

Type of research design

Exploratory research

Exploratory research provides insight in to and comprehension of an issue or situation. It

should draw definitive conclusions only with extreme caution. Exploratory research findings
will emphasize the researcher to learn about the particular problem in subsequent conclusive
studies. Exploratory research relies on secondary data it does no have rigid design as the
researcher themselves are no very well versed with subject and trying to gain knowledge of
same.

TYPES OF DATA

Secondary data

42
The secondary data, on the other hand, are those which have already been collected by
someone else and which have already been passed through the statistical process. The
researcher of the purpose of the study has collected data which was purely secondary in nature
the information collected from journals, annual report of the company manuals.

3.2 TOOLS USED FOR ANALYSIS

The tools used for analysis of the collected data are

 Trend analysis

Trend analysis

The trend analysis is a technique of studying several financial statements over a series of
years. In this analysis the trend percentages are calculated for each item by taking the figure
of that item for the base year taken as 100. Generally the first year is taken as a base year .
the analyst is able to see the trend of figures, whether moving upward or downward. In brief,
the procedure for calculating trends is as;

 One year is taken as a base year which is generally is the first year or last year.
 Trend percentages are calculated in relation to base year.

43
 4.1 DATA ANALYSIS AND INTERPRETATION

The table 4.1.1

Table shows the Manufacturing overhead budget From 2009 To 2013

Particula 2009 2010 2011 2012 2013

r

Elecricity 59259 69136 79102 88889 98765

charges

Labour 1382432 1612837 1843242 2073648 2304053

charges

Wages 2756444 3215851 3675258 4134666 4594073

Repair 19200 22400 25600 28800 32000

and
maintains
Total 4368177 5095506 5823524 6551366 7279294

Inference
The above table 4.1.1 shows the Manufacturing overhead budget the Manufacturing overheads
was continously increasing from 2009 to 2013 i.e from Rs.4368177 to Rs.7279294.

44
 Chart 4.1.1
Bar diagram show the manufacturing overhead budget

8000000
7000000
6000000
5000000
4000000
rupees

3000000 Repair and maintains

2000000 Wages
Labour charges
1000000
Elecricity charges
0
0 09 0 10 0 11 0 12 0 13
-2 -2 -2 -2 -2
08 09 10 11 12
20 20 20 20 20

years

45
 Table 4.1.2
The Administration overhead budget

PARTICULAR 2009 2010 2011 2012 2013

Administration 428220 494100 559980 625860 658800

salaries

Administration 685989 800321 914652 1028984 1143315

overhead

TOTAL 1114209 1294421 1474632 1654844 1802115

Inference
The above table 4.2.1 shows the administrative overhead budget the administrative overheads
was continously increasing from 2009 to 2013.The administrative overheads was increasing
from Rs.1114209 to Rs.1802115 from above mentioned periods.

46
 Chart 4.1.2

Bar diagram shows the administrative overhead budget

2000000
1800000
1600000
1400000
1200000
1000000
800000
rupees

600000 Administration overhead

400000
200000 Administration salaries
0
0 09 0 10 0 11 0 12 0 13
-2 -2 -2 -2 -2
08 09 10 11 12
20 20 20 20 20

years

47
 Table 4.1.3
Selling and distribution overhead budget
PARTICULAR 2009 2010 2011 2012 2013

Selling and 18025103 20798196 23571289 26344381 27730928

distribution
expenses

TOTAL 18025103 20798196 23571289 26344381 27730928

Inferences
The above table 4.1.3 shows the selling and distribution overhead budget the selling and
distribution overheads was continuously increasing from 2009 to 2013.the selling and
distribution overhead was increasing from Rs.18025103 to Rs. 27730928.

48
 Chart 4.1.3
Bar diagram shows the selling and distribution over head

30000000

25000000

20000000

15000000
rupees

10000000 Selling and distribution

expenses

5000000

0
0 09 0 10 0 11 0 12 0 13
-2 -2 -2 -2 -2
08 09 10 11 12
20 20 20 20 20

years

49
 Table 4.1.4
PARTICULAR 2010 2011 2012 2013
2009

Raw material 13594662 15686149 17777635 19869122 20914865

TOTAL 13594662 15686149 17777635 19869122 20914865

Raw material budget

Inferences
In the above table 4.1.4 shows the raw material budget in the period of 2009 to2013 procure high level
the raw material procurement it was increasing from RS 13594662 TO RS 20914865.

50
 Chart4.1.4
The bar chart shows the Raw Material budget

25000000

20000000

15000000
rupees

10000000

5000000

0
2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
years

51
 Table 4.1.5
Cash budget
PARTICULAR 2009 2010 2011 2012 2013
Opening balance 1625202 1395274 1129968 885288 3451134
cash

(+)income 18025103 20798196 23571289 26344382 27730928

Total Income 19650305 22193470 24701257 27229670 31182062

(-)expenditure 18255031 21063502 23815969 23778536 28084668

TOTAL 1395274 1129968 885288 3451134 3097394

Inferences
The above table 4.1.5 shows the cash budget from 2009 -2013 the organization cash
position shows positive cash balance only. It indicates the organization cash position has been
decreasing from Rs. 1395274 to Rs. 3097394 further it has been decreased .

52
 Chart 4.1.5
The bar diagram show the cash budget

100000000
90000000
80000000
70000000
60000000
50000000
rupees

(-)expenditure
40000000
30000000 (+)income
Opening balance cash
20000000
10000000
0
9 0 1 2 3
2 00 2 01 2 01 2 01 2 01
0 8- 0 9- 1 0- 1 1- 1 2-
20 20 20 20 20
years

53
 Table 4.1.6
Table showing the Flexible budget at 60%, 70% & 80%
Particulars 52% 60% 70% 80%
530 612 713 815
Per amount Per amount Per unit amount Per Amount
unit unit unit
Variable
over heads
Labour 4347 2304053 4347 2660529 4347 3099603 4347 3543025
charges
Wages 8668 4594073 8668 5304854 8668 6180328 8668 7064471
Bonus 219 116144 219 134113 219 156247 219 178599
Conveyance 65 34200 65 39491 65 46009 65 52591
TOTAL 1329 7048470 13299 8138987 13299 9482187 13299 10838686
A 9
Semi-
variable
over heads
Repair&main 18 9600 18 11085 18 12915 18 14762
taince (30%
variable)
Electric 75 39506 75 45618 75 53147 75 60750
charges
(40%
variable)
Repair&main 42 22400 37 22400 31 22400 27 22400
taince (70%
Fixed)
Electric 112 59259 97 59259 83 59259 73 59259
charges
(60% fixed)
Total B 247 130765 227 138362 207 147721 193 157081
Fixed over
head’s
Rent 226 120000 196 120000 168 120000 147 120000
Insurance 32000 52 32000 45 32000 39 32000

54
Depreciation 472 250403 409 250403 351 250403 307 250403

Bank interest 275 145656 238 145656 204 145656 179 145656
Bank charges 10 5453 9 5453 8 5453 7 5453
Computer 40 21300 35 21300 30 21300 26 21300
maintaince
Staff salary 124 65880 102 65880 92 65880 81 65880
Professional 38 20000 33 20000 28 20000 25 20000
charges
Staff welfare 143 76000 124 76000 107 76000 93 76000
Business 57 30000 49 30000 42 30000 37 30000
promotion
Travelling 144 76100 124 76100 107 76100 93 76100
expenses
Telephone 157 82979 136 82979 116 82979 102 82979
charges
Printing& 11 6000 10 6000 8 6000 7 6000
Stationary
Total c 1757 931771 1517 931771 1306 931771 1143 931771
Total=a+b+c= 15303 8111006 15043 9209120 14812 10561679 14635 11927538
d

Inference
The above table shows the flexible budget at 52%, 60%, 70% & 80%. The current
level of capacity is at 52% the cost at this level is Rs. 8111006 , at 60% level the cost is Rs.
9209120 at 70% the cost is Rs. 10561679 & at 80% the cost is 11927538.

55
 Chart 4.1.6.6 A
Flexible budget at 52% in 530 units

9000000

8000000

7000000

6000000

5000000

4000000
52% 530 amount
3000000 52% 530 Per unit

2000000

1000000

0
ds L A ds ’s lB ’s lc B+
C
ea TA ea ead o ta ead o ta +
h O h T
ve
r T
ve
r rh T
er
h
D=
A
o o ove ov L
le le ed ed TA
r iab r iab Fix Fix TO
Va i-v
a
em
S

Chart 4.1.6.6 B
Flexible budget at 60% in 612 units

56
10000000

9000000

8000000

7000000

6000000

5000000

4000000
60% 612 amount
3000000 60% 612 Per unit

2000000

1000000

0
ds lA ds ad
’s B ’s C
B+
C
h ea ota hea e TAL ead TAL +
ve
r t
ve
r rh TO rh TO =A
o o ove ove A LD
le le d d T
r iab r iab ixe ixe TO
a F F
Va i-v
m
Se

Chart 4.1.6.6.C
Flexible budget at 70% in 713 unit

57
12000000

10000000

8000000

6000000

4000000 70% 713 amount

70% 713 Per unit

2000000

0
s A s ’s LB d’
s LC +C
e ad tal ead ead A ea TA +B
h to h h T h O A
ve
r
ve
r r TO r T =
o o o ve o ve
A LD
le le d d T
r iab r iab Fixe Fixe TO
Va i-v
a
m
Se

Chart 4.1.6.6.D
Flexible budget at 80% in 815 units

58
14000000

12000000

10000000

8000000

6000000
80% 815 Amount
80% 815 Per unit
4000000

2000000

0
s A ’s B ’s C +C
ad L ad L ad L
+B
e TA e TA e TA
rh TO er
h
TO er
h
TO D=
A
ve
le
o ov ov
TAL
ir ab ed ed TO
Fix Fix
Va

5.1Findings

 Manufacturing overhead budget has been continuously increasing & very high in the year of
2013

59
 Administration overhead budget has been continuously increasing & very high in the year of
2013
 Selling and distribute overhead budget has been continuously increasing & very high in the
year of 2013
 Raw material overhead budget has been continuously increasing & very high in the year of
2013
 Cash budget has been maintained positive cash balance & it has been continuously decreased
from 2009 to 2013.
 Flexible budget at 60%,70%,80% level capacity the forecasted cost has been varies
according to the various level

5.2Suggestions

60
 The company has to concentrate more on procuring raw material at low cost to reduce
manufacturing expenses
 The company can try to reduce administrative cost like salaries overhead in the
forthcoming period.
 The company can try to reduce selling and distribution cost in the future periods
 The company can invest their positive cash balance in a profitable way like invest on
securities & others.
 The company can increase their capacity from 530 units at 52% to 60% OR 70% OR
80%

5.3Conclusion

61
 The study conducted in “KAKKALUR TECHNOKRAT’S PVT LTD AT
THIRUVALLUR”. Helped me to get practical knowledge regarding preparation of
various budgeting in the organization. A detailed study about of the organization
various financial analysis tools used for such as trend analysis it has been found out
that better financial position in the organization..

 Budgeting is a major technique to analyze the financial position of the company from
the budgeting analysis it is found that various budgeting techniques shows the
continuous increases in the overheads like administration, selling & distribution &
manufacturing & expenditure at the same level of capacity from 2009-2013. so the
organization has to take some action to reduce cost in the further year then it will helps
to improve the profitability position of the company.

 It is also concluded that the overall budgeting of “KAKKALUR TECHNOKRAT’S

PVT LTD AT THIRUVALLUR”. Considered as better but efficiency in utilization
resource to improve successful annual report and get more profit to the organization.

BIBLIOGRAPHY

62
  T.S REDDY & A.MURTHI “financial management’’ (Chennai : margham
publications, 2010)

 T.S REDDY & Y.HARI HARI PRASAD “ cost accounting’’(Chennai : margham

publications, 2010)

 M.Y. KHAN AND P.K. JAIN “financial management’’ (tata mcgraw –bill publishing
company limited, fifth edition)

 PRASANA CHANDRA “financial management’’ (tata mcgraw –bill publishing

company limited, fifth edition)

 RAJIV SRIVASTAVA AND ANIL MISRA“financial management’’ (oxford higher

edccation, 2008 publication)

WEBLIOGRAPHY

 www.thefreedictionar.com

 www.business dictionar.com

 Oxford dictionaries.com

 www.forbes.com

 www.icaew.com

 www.investpedia.com

Techn krat’s profit& loss A/C as on 31-03-2009

Particulars Amount Particular Amount

63
To opening stock 1596392 By sales 18025103
To purchase 13126662 By closing stock 3658166
To electricity charges 64197
To labour charges 1497634
To wages 298657
To gross profit 5099757
21683299 21683299
11700
To audit accounting fees
3544 5099757
To bank charges By gross profit
94676
To bank interest paid
75494
To bonus
13845
To computer maintain
22230
To conveyance
78000
To rent
20800
To repair& maintain
53936
To telephone charges
49465
To travelling expenses
49400
To staff welfare
13000
To professional charges
428220
To salary paid
3900
To printing& stationary
7280
To postage & courier
19500
To business promotion
20800
To insurance paid
162762
To depreciation
3971205
To net profit 5099757 5099757

Techn krat’s profit& loss A/C as on 31-03-2010

Particulars Amount Particular Amount

To opening stock 1841923 By sales 20798196

64
To purchase 15146149 By closing stock 4220961
To electricity charges 740745
To labour charges 1728040
To wages 3445555
To gross profit 2783416
25019157 25019157
13500
To audit accounting fees
4090 2783416
To bank charges By gross profit
109242
To bank interest paid
87108
To bonus
15975
To computer maintain
25650
To conveyance
90000
To rent
24000
To repair& maintain
62234
To telephone charges
57075
To travelling expenses
57000
To staff welfare
15000
To professional charges
494100
To salary paid
4500
To printing& stationary
8400
To postage & courier
22500
To business promotion
24000
To insurance paid
187802
To depreciation
1481240
To net profit 2783416 2783416

Techn krat’s profit& loss A/C as on 31-03-2011

Particulars Amount Particular Amount

To opening stock 2087512 By sales 23571289
To purchase 17165635 By closing stock 4783756

65
To electricity charges 83950
To labour charges 2188850
To wages 4364370
To gross profit 2464728
28355045 28355045
15300
To audit accounting fees
4635 2464728
To bank charges By gross profit
1238076
To bank interest paid
98722
To bonus
18105
To computer maintain
29070
To conveyance
102000
To rent
27200
To repair& maintain
70532
To telephone charges
64685
To travelling expenses
64600
To staff welfare
17000
To professional charges
559980
To salary paid
5100
To printing& stationary
9520
To postage & courier
25500
To business promotion
27200
To insurance paid
21245
To depreciation
66258
To net profit 2464728 2464728

Techn krat’s profit& loss A/C as on 31-03-2012

Particulars Amount Particular Amount

To opening stock 2333102 By sales 26344382
To purchase 19185122 By closing stock 5346551
To electricity charges 93827

66
To labour charges 2188850
To wages 4364370
To gross profit 3525662
31690933 31690933
17100
To audit accounting fees
5180 3525662
To bank charges By gross profit
138373
To bank interest paid
110337
To bonus
20235
To computer maintain
32490
To conveyance
114000
To rent
30400
To repair& maintain
78830
To telephone charges
72295
To travelling expenses
72200
To staff welfare
19000
To professional charges
625860
To salary paid
5700
To printing& stationary
10640
To postage & courier
28500
To business promotion
30400
To insurance paid
237883
To depreciation
1876239
To net profit 3525662 3525662

Techn krat’s profit& loss A/C as on 31-03-2013

particulars Amount Particular Amount

To opening stock 2455897 By sales 18025103
To purchase 20194865 By closing stock 3658166
To electricity charges 98765
To labour charges 2304053

67
To wages 4594073
To gross profit 3711223
21683299 21683299
18000
To audit accounting fees
5453
To bank charges
145656 3711223
To bank interest paid By gross profit
116144
To bonus
21300
To computer maintain
13800
To conveyance
120000
To rent
32000
To repair& maintain
82979
To telephone charges
76100
To travelling expenses
76000
To staff welfare
20000
To professional charges
658800
To salary paid
6000
To printing& stationary
11200
To postage & courier
30000
To business promotion
32000
To insurance paid
250403
To depreciation
1974988
To net profit 3711223 3711223

ABSTRACT

As a part of curriculum I have conducted a study on budgeting in KAKKALUR

TECNOKRAT’S PVT LTD thiruvallur. Budgeting is the process of identifying the financial
strength and weakness of the firm by properly establishing the relationship between the items
of balance sheet and and loss account of the organization. The main purpose of the study very

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essential to measure the efficiency, profitability, financial soundness of the organization. The
data are collected for the study was analysis by budgeting tools result based finding and
suggestion are drawn. this project report will help to company to under standard the current
financial position and more than help to the future research for finding out more solution to the
problem

“A Study on budgeting in technokrat’s (India)Pvt.

Ltd kakkalur”
PROJECT REPORTBY

S.JAYAKUMAR

(Register Number: 110312631015)

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 A PROJECT REPORT

Submitted to the

DEPARMENT OF MANAGEMENT STUDIES

Of

GRT INSTITUTEOF ENGINEERING & TECHNOLOGY, TIRUTTANI.

In partial fulfillment for the award of degree

of
MASTER BUSINESS ADMINISTRATION
IN

finance

ANNA UNIVERSITY CHENNAI- 600025

JUNE- 2014.

GRT INSTITUTE OF ENGINEERING ANDTECHNOLOGY,

TIRUTTANI
(AFFILIATED TO ANNA UNIVERSITY)

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 BONAFIDE CERTIFICATE

This is to certify that Mr .S.JAYAKUMAR (Reg.no:110312631015) is a bonafide

student of final year MBA degree course, has undergone project work entitled “A Study on
budgeting in technokrat’s, kakkalur” certified further that to the best of my knowledge the
work reported here in does not form part of any other project report or dissertation on the basis
of which a degree or award was conferred on an earlier occasion this or any other candidate.

Signature of guide Signature of HOD

Mrs.,MBA,PGDMM. Dr.C.Dhasarathan,MBA.,MA.,(Eco),M.Ed.,

M.Phil., Ph.D.

Submitted to the project viva examination held on.......................................

Signature of Internal Examiner Signature of ExternalExaminer

DECLARATION

I S.JAYAKUMAR (Register No: 110312631015)bonafide student of GRT

INSTITUTE OF ENGINEERING AND TECHNOLOGY ,Tiruttani would like to declare
that the project entitled (“A Study on budgeting in technokrat’s (India) Pvt. Ltd at
kakkalur”). Submit the guidance of titled of the ANNA UNIVERSITY in partial fulfillment
of the requirement for the award of the degree of MASTER OF BUSINESS
ADMINISTRATION is a record of original and independent research work done by me,
under the guidance of Mrs.S.JAGADEESWARI(assistant professor)M.B.A.,PGDMM., and
it has not formed the basis for the award of degree of any formed the basis for award of any
degree or other similar to any candidate in any university.

71
 0Place:Tiruttani. (S.JAYAKUMAR)
Date:
(Reg.No:110312631015)

ACKNOWLEDGEMENT

With the divine blessing of god, I take immense pleasure in starting the acknowledgement for
this project.

I express my deep gratitude to shri. G. Rajendran, chairman, of GRT Institute of

engineering and technology, Tiruttani.

I am gratefully obliged to Dr.Arumugam,M.E.,Ph.D. principal of GRT Institute of

engineering and technology, Tiruttani.

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My sincere thanks toDr.C.Dhasarathan.., MBA.,MA.,(Eco),M.Ed., M.Phil., Ph.D. Headof
the department of management studies for his motivation and providing me the to complete
this project.

I acknowledge & my sincere thanks to Mrs.S.Jagadeeswari,MBA,PGDMM.Assistant

professor for her suggestion from time to time to bring this project successfully.

I would like to thank my external guide Mr.Muralidharan(manager) for giving me greatest

opportunity do this project work in the organisation and complete the project successfully.

I would like to extend my sincere thanks to my department faculty members and friends and
parents motivation to complete this project.

I am also thankful to the all customers of technokrat’s (India) Pvt. Ltd for providing me the
detail about the company for the encouragement of completes the project successfully.

TABLE OF CONTENTS

CHAPTER PARTICULARS PAGE NO

1.1 INTRODUCTION 1-3

1.2 STATEMENT OF THE PROBLEM 4

1.3 OBJECTIVES OF STUDY 5

I 1.4 NEED OF THE STUDY 6

1.5 SCOPE OF THE STUDY 7

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 1.6 LIMITATIONS OF THE STUDY 8

1.7 INDUSTRY PROFILE 9-11

1.8 COMPANY PROFILE 12

II 2.1 REVIEW OF LITERATURE 13-15

III 3.1 RESEARCH METHODOLOGY 16-18

4.1 DATA ANALYSIS & INTERPRETATIONS 19

IV

5.1 FINDINGS 74

5.2 SUGGESTIONS 75

V 5.3 CONCLUSION 76

APPENDIX

REFERENCES

QUESTIONNAIRE

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