ABC INVESTMENTS

M.L. Singla
Faculty of Management Studies
University of Delhi

(Strictly for Limited & Private Circulation)

Operations :

ABC Investments is an authorized share, stock and finance broker firm in

Ahmedabad. It has been in business for over a decade. The firm buys or sells scrips for its
clients. The organization has two managers, three accountants, one computer operator,
five floor operators in the stock market and two clerks. The firm has six authorized sub-
brokers. These sub-brokers may in turn have their own unauthorized sub-brokers. There
are around 100 to 200 authorized or main brokers and over thousand sub-brokers in
Ahmedabad.

The firm has a Pentium-II with a Inkjet printer. It uses a software package from
Mastek costing around Rs.50,000 which is designed specifically for Stock Market
Operations.

Any client who wishes to do spot trading with the firm (wherein delivery of
certificate and payment of cash is in most cases carried out at the end of the day) may
specify the transaction he wishes the firm to undertake or the firm may advise him on a
profitable transaction. The client contacts the firm personally or by telephone at the start
of the day and places his orders specifying the scrip and quantity and whether he wishes
to buy or sell. The firm records these in the order book manually. A record of the stock it
already holds is also maintained. This stock is the leftover from earlier transactions. After
deducting this quantity from the orders, the sub-brokers and the floor operators of the
firm are given the remaining amount for which they should transact in the Stock Market
during the day. At the end of the day the sub-brokers consolidate the transactions carried
out in the stock exchange and the current rates for all scrips are updated. The firm issues
a CONTRACT FORM for the customers whose orders could be carried out that day. For
every order a separate contract form is issued. The CONTRACT FORM specifies the
Notes :
1. Material prepared from a class room discussion note.
2. The sub-brokers are just like other customers to the firm. They too get
CONTRACT FORMS for the scrips they deal in and receive billing reports and
settle with the firm every 15 days.

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type of transaction i.e. buy or sell, quantity, rate, name of the customer and name of the
scrip (Exhibit - I). If the quantity is less than the ordered, the customer is asked over
telephone at the end of the day whether he wishes the remaining order to be placed for
the next day. These CONTRACT FORMS are then mailed to the client. The firm handles
on an average 40 to 50 CONTRACT FORMS daily.

On receipt of the CONTRACT FORM the client sends an ACKNOWL-

EDGMENT SLIP to the firm confirming his receipt of the CONTRACT FORM. This
form is the legal evidence of the deal in case of any dispute thereafter.

The firm generates a separate billing report for each customer every fifteen days.
Exhibit-II shows a sample report. In this report both the sell and buy transactions during
last 15 days for each scrip are mentioned specifying the date, quantity and rate of each of
the transaction and the cash difference between the total amount of buy and sell. The
difference is then settled between the client and the firm. The firm also generates a
general scripwise report of all transactions it carried out during the last 15 days. Exhibit-
III shows a sample report.

Data Processing :

In the following an analysis and steps required to computerize the operations at

ABC Investments are presented.

S.No. Operation Input Data File

1. Customer places orders for Customer name Order file
buy/sell Scrip name
Quantity
Date
2. Transactions in market

3. Contract forms on basis of Customer name Contract File

transactions Scrip name
Quantity
Rate
Date

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Database files and the fields are as follows :

Input files :

1. Cust : 1. Customer name

2. Customer code
3. Address
4. Telephone number

2. Stock : 1. Scrip name

2. Scrip code
3. Opening
4. Closing
5. Prevclose
6. Highrate
7. Lowrate
8. Todayrate
9. Buyqty
10. Sellqty

3. Order : 1. Order No
2. Customer code
3. Scrip code
4. Buyqty
5. Sellqty
6. Buyalloc
7. Sellalloc
8. Date

4. Buysell : 1. Scrip code

2. Opening
3. Closing
4. Prevclose
5. Highrate
6. Lowrate
7. Todayrate
8. Buyqty
9. Sellqty
10. Date

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Output files :

1. Currcont : 1. Order No
2. Customer code
3. Scrip code
4. Buyqty
5. Sellqty
6. Rate
7. Date

2. Contfile : 1. Customer code

2. Scrip code
3. Buyqty
4. Sellqty
5. Rate
6. Date

3. Genfile : 1. Scrip code

2. Buyqty
3. Sellqty
4. Rate
5. Date

Following is the detailed description of each report :

1. Contract Form :

Frequency of generation - Daily

Fields - Customer name and address, Scrip name,

Buyquantity, Sellquantity, Rate and Date

Generated from - Currcont

Cust
Stock

2. Billing Report :

Frequency of generation - Fortnightly

Fields - Customer name, Scrip name, Buyquantity,

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 Sellquantity, Rate, Amount, and Date of
each transaction, Buy Amount and Sell
Amount, Difference of two Amounts

Generated from - Currcont

Cust
Stock

3. General Report :

Frequency of generation - Fortnightly

Fields - Scripname, Buyquantity, Sellquantity, Rate,

Amount and Date

Generated from - Genfile

Exhibit – I : Contract Form

Name : Date :
Scrip Name Bought/Sold Quantity Rate

Exhibit – II : Billing Report

Name :
Bought Scrip Rate Date Sold
Quantity Amount Quantity Amount

Total Buy Amount

Total Sell Amount
Difference to be
settled

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 Exhibit – III : General Report
Date Scrip BuyQty SellQty Rate Amount

File Design :

The files used in the system can be classified as :

Master files : CUST and STOCK

Transaction files : ORDER and BUYSELL

Intermediate file : ORDTOT

Output files : CURRCONT, CONTFILE and GENFILE

Report format files : CONT, BILL and SCRIP

File Description :

Master Files : Master files are created and maintained to hold almost permanent data.

1. CUST : This file contains information of all customers.

Field Field Name Type Width

1. CUSTNAME Character 25
2. CUSTCODE Character 4
3. CUSTADD Character 30
4. CUSTPHONE Character 10

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2. STOCK : This file contains the information of all the scrips.

Field Field Name Type Width

1. SCRIPNAME Character 15
2. SCRIPCODE Character 4
3. OPENING Numeric 10
4. CLOSING Numeric 10
5. PREVCLOSE Numeric 10
6. HIGHRATE Numeric 10
7. LOWRATE Numeric 10
8. TODAYRATE Numeric 10
9. BUYQTY Numeric 10
10. SELLQTY Numeric 10

Transaction files: These files contain transaction data.

1. ORDER : This file contains current day's orders.

Field Field Name Type Width

1. ORDNO Numeric 10
2. CUSTCODE Character 4
3. SCRIPCODE Character 4
4. BUYORD Numeric 10
5. SELLORD Numeric 10
6. BUYALLOC Numeric 8
7. SELLALLOC Numeric 8
8. DATE Date 8

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2. BUYSELL : This file contains today's buy and sell details.

Field Field Name Type Width

1. SCRIPCODE Character 4
2. OPENING Numeric 10
3. CLOSING Numeric 10
4. PREVCLOSE Numeric 10
5. HIGHRATE Numeric 10
6. LOWRATE Numeric 10
7. TODAYRATE Numeric 10
8. BUYQTY Numeric 10
9. SELLQTY Numeric 10
10. DATE Date 8

Intermediate file : This file is used to hold intermediate data before generating
the output files.

1.ORDTOT: This file is used to hold the scripwise quantity to be bought

and sold for current day.

Field Field Name Type Width

1. SCRIPCODE Character 4
2. BUYQTY Numeric 10
3. SELLQTY Numeric 10

Output files : These files hold data before generating reports.

1.CURRCONT: This file is used to hold all current day's buy and sell orders
for all customers.

Field Field Name Type Width

1. ORDNO Numeric 10
2. CUSTCODE Character 4
3. SCRIPCODE Character 4
4. BUYQTY Numeric 10
5. SELLQTY Numeric 10
6. RATE Numeric 10
7. DATE Date 8

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2.CONTFILE: This file contains each buy and sell details for all customers
for period of 15 days.

Field Field Name Type Width

1. CUSTCODE Character 4
2. SCRIPCODE Character 4
3. BUYQTY Numeric 10
4. SELLQTY Numeric 10
5. RATE Numeric 10
6. DATE Date 8

3.GENFILE: This file contains scripwise buy/sell over the period of 15

days.

Field Field Name Type Width

1. SCRIPCODE Character 4
2. BUYQTY Numeric 10
3. SELLQTY Numeric 10
4. RATE Numeric 10
5. DATE Date 8

Report format files :

Report format files CONT, BILL and SCRIP are created to hold report formats in
generating the contract forms, billing report and scripwise general report respectively.

You are required to develop :

- a systems flow chart for the exercise

- the file structures, data records and the program command files in any language.

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