INTERNSHIP REPORT

A report submitted in partial fulfilment of the requirements for the award of the Degree of

BACHELOR OF SCIENCE IN MATHEMATICS

of Bharathiar University, Coimbatore 641 046.

Internship work done by

S. SHIMA
(Register number:201MT030)

Under the guidance of

Dr. M. SANGEETHA

M. Sc., M. Phil., B. Ed., PGDOR., Ph. D.

Professor
Department of Mathematics

(Duration : 11th July 2022 to 27th July 2022)

DEPARTMENT OF MATHEMATICS

Dr. N. G. P ARTS AND SCIENCE COLLEGE

(An autonomous institution, Affiliated to Bharathiar University, Coimbatore)

Approved by Government of Tamil Nadu and accredited by NAAC with “A++” Grade (3rd
cycle),Dr. N.G.P. Kalapatti Road, Coimbatore – 641 048, Tamil Nadu, India.

Website : www.drngpasc.ac.in|Email :info@drngpasc.ac.in|Phone:+914222369100

2020-2023
 DEPARTMENT OF MATHEMATICS

Dr. N.G.P ARTS AND SCIENCE COLLEGE(AUTONOMOUS)

COIMBATORE – 641 048

CERTIFICATE

This is to certify that the “Internship report” submitted by S. SHIMA (Register number :
201MT030) is done by her and submitted during the academic year 2020 – 2023, in partial
fulfilment of the requirements for the award of the Degree of Bachelor of science in Mathematics,
Bharathiar University, Coimbatore.

_____________ ___________________________

GUIDE HEAD OF THE DEPARTMENT

Submitted for the Viva-Voce Examination held on _________________

__________ ___________

INTERNAL EXTERNAL
 DECLARATION

S. SHIMA (Register number : 201MT030) do hereby declare that the presented report of the
internship titled “JUNIOR ACCOUNTANT”, submitted to Dr. N.G.P Arts and Science College,
affiliated to Bharathiar University, Coimbatore, in partial fulfilment of the requirements for the
award of the Degree of Bachelor of Science in Mathematics, is a record of original work done by
me under the guidance of Dr.M.SANGEETHA M. Sc., M. Phil., B. Ed., PGDOR., Ph. D.,
Professor, Department of Mathematics, after the completion of 15 days of work at Sri Jayaramm
Textiles, Tiruppur, India.

PLACE: COIMBATORE SIGNATURE OF THE STUDENT

DATE : S. SHIMA

(Reg. No: 201MT030)

 ACKNOWLEDGMENT

First I would like to thank Mr. Eswaramoorthi, the Co-partner of Sri Jayaramm Textiles,
Tiruppur, India, for giving me the opportunity to do an internship within the organization. I also
would like all the people that worked along with me at Sri Jayaramm Textiles, with their patience
and openness they created an enjoyable working environment. It is indeed with a great sense of
pleasure and immense sense of gratitude that I acknowledge the help of these individuals.

I am highly indebted to Chairman Dr. Nalla G. Palaniswami M.D., A.B. (USA) and Madam
Secretary Thavamani D. Palaniswami M.B.B.S., A.B.(USA), Dr. N.G.P. Arts and Science
College, Coimbatore and Principal Prof. Dr. V. Rajendran M.Sc., M.Phil., B.Ed., M.Tech
(Nanotech)., Ph.D., (D.Sc.)., FInstP.(London), for the facilities provided to accomplish this
internship.

I would like to thank Dean, Research and Development Dr. S.Balasubramanian M.Sc.,
Ph.D (Swiss)., PDF (Swiss)., PDF (USA), for his constructive support throughout my internship.
I would like to thank my Head of the Department Dr. R. Sowrirajan M.Sc., M.Phil., Ph.D. for
his constructive criticism throughout my internship.

I would like to thank Dr.M.Sangeetha M. Sc., M. Phil., B. Ed., PGDOR., Ph. D., Professor,
Department of Mathematics for her support and advices to get and complete internship in above
said organization.

I am extremely grateful to my department staff members and friends who helped me in

successful completion of this internship.

I wish to thank my Parents and Friends for their support and encouragement throughout my
study.

Success, the destiny of hard work and pain, is achieved only with the help of my most gracious
and ever loving Almighty without whose blessing, nothing would come to pass. I dedicate to him
this humble endeavor of mine.

S. SHIMA
 PREFACE

The purpose of this report is to explain what I did and learnt during my internship period
with Sri Jayaramm Textiles in buying and selling of goods to other companies.The report focuses
primarily on the assignments handled, working environment, successes and short comings that the
intern did encounter when handling various tasks assigned to him by the supervisor.

Because the various parts of the report reflect the intern's shortcomings, successes.
observations and comments, it would be imperative that the recommendations are also given.
Therefore the report gives a number of comments and recommendations on the internship program.

It is hoped that this report would serve as a cardinal vehicle to the improvement of the
internship program.

COMPANY PROFILE

COMPANY NAME : Sri Jayaramm Textiles (JRT)

TYPE : Power loom and Auto loom Export Cloth Manufacturer

FOUNDER : Mr. Eswaramoorthy

ADDRESS : No. 3/454, Ponniya Gounder Thottam, Kombakkadu Pudur, Ichipatti (Po),

Palladam, Somanur, Tiruppur (Dt), - 641 668, Tamil Nadu, India.

PHONE NUMBER : 98422 73749, 80722 14548.

EMAIL ID : jayarammtexeswaran@gmail.com
 OBJECTIVE OF THE COMPANY

VISION

To achieve 100% customer satisfaction through timely delivery with zero defect shipments,
to bring in best technology, upgrading the machine health and skill sets of our people, To incubate
professionals who will be able to innovate textile products with novel features and functions useful
for human kind, and to design new textile manufacturing processes that will promote the ability to
compete with the industry globally.

MISSION

Sri Jayaramm Textiles is committed to the consistent upliftment and improvement of both
its products and its responsibilities towards it’s employees. Striving hard to achieve highest levels
of customer satisfaction through timely deliveries along with enhanced quality and value of all our
products.

VALUES

Honesty, integrity and human dignity, besides ethical approach in engagements with all
connected stakeholders; customers, suppliers, employees and others, remain close to our hearts
resulting in our hard earned repute and success.
 TABLE OF CONTENTS

CHAPTER
PARTICULARS PAGE NO
NO
1 INTRODUCTION 1
1.1 TEXTILE INDUSTRY 1
2 COTTON TEXTILE INDUSTRY 1
INTRODUCTION TO COTTON TEXTILE
2.1 1
INDUSTRY
2.2 COTTON TEXTILE INDUSTRY IN INDIA 1
2.3 GROWTH AND DEVELOPMENT 2
2.4 PRESENT POSITION 2
2.5 LOCATIONAL FACTORS 3
2.6 CHALLENGES 4
2.6.1 SCARCITY OF RAW COTTON 4
2.6.2 OUTDATED MACHINERY 4
2.6.3 ERATIC POWER SUPPLY 4
2.6.4 LOW LABOUR PRODUCTIVITY 5
2.6.5 STRIKES 5
2.6.6 TOUGH COMPETITION 5
2.6.7 SICK MILLS 5
2.7 SIGNIFICANCE 6
2.8 GOVERNMENT INITIATIVES 6
2.9 EXPORTS 7
3 POWER LOOM AND AUTO LOOM 7
3.1 POWER LOOM 7
3.1.1 USAGE AND IMPORTANCE 8
3.1.2 TYPES OF POWER LOOM 10
3.1.3 POWERLOOM INDUSTRIES IN INDIA 11
3.2 AUTOLOOM 12
3.2.1 ADVANTAGES OF AUTOLOOM 12
3.2.2 WORKING OF AUTOLOOM 12
DIFFERENCE BETWEEN POWER LOOM AND
3.3 12
AUTO LOOM
4 SOUTH INDIAN TEXTILE INDUSTRY 17
5 ACCOUNTING 17
5.1 JUNIOR ACCOUNTANT 18
5.1.1 DUTIES AND RESPONSIBILITIES 19
5.1.2 QUALIFICATION 19
5.1.3 SALARY 20
5.1.4 CAREER OPPORTUNITIES 20
5.1.5 IMPORTANCE OF ACCOUNTANT 21
5.1.6 REQUISITES OF JUNIOR ACCOUNTANT 21
6 INTERNSHIP ACTIVITIES
6.1 METHODOLOGY 22
6.2 INTRODUCTION AND EXPLANATION 23
6.2.1 WORK PROCESS OF THE COMPANY 23
6.3 JOURNAL 23
6.3.1 JOURNAL ENTRIES 23
6.4 LEDGER 24
6.4.1 IMPORTANCE OF LEDGER ENTRIES 25
CONVERTING JOURNAL ENTRIES TO LEDGER
6.4.2 26
ACCOUNTS
6.5 TALLY ERP9 26
6.5.1 CREATING LEDGERS 27
6.6 ACCOUNTING VOUCHERS 27
6.6.1 COMPONENTS OF ACCOUNTING VOUCHERS 29
6.6.2 TYPES OF ACCOUNTING VOUCHERS 30
 PROCESS OF USING ACCOUNTING
6.6.3 31
VOUCHERS
6.6.4 CREATING VOUCHERS 32
6.7 BILLS 33
6.8 INCOME TAX 33
6.8.1 SLAB 34
6.8.2 INCOME TAX REGISTRATION 35
6.8.3 PAYING INCOME TAX THROUGH ONLINE 36
6.9 GST 37
6.9.1 REGISTRATION OF GST THROUGH ONLINE 37
6.9.2 PAY GST THROUGH ONLINE 38
6.10 ACCOUNTS RECEIVABLE 38
6.11 INVOICE 39
6.12 PAYROLL TAXES 39
6.12.1 FEDERAL PAYROLL TAXES 39
6.13 AUDIT 39
6.14 CONCLUSION 40
 1.INTRODUCTION

1.1. TEXTILE INDUSTRY:

The textile industry is primarily concerned with the design, production and distribution of yarn,
cloth and clothing. The raw material may be natural, or synthetic using products of the chemical
industry.

2.COTTON TEXTILE INDUSTRY

2.1. INTRODUCTION TO COTTON TEXTILE INDUSTRY:

Cotton textile Industry is the quickest-growing segment of the textile industry. China and
India are the world's largest producers of cotton textiles. Around 4.5 crore people are employed in
India's textile industry, including 35.22 lakh handloom workers.

In 2018-19, the industry contributed 7% of total industry output (by value). In the same
year, the Indian textiles and apparel industry contributed 2% to GDP, 12% to export earnings, and
5% to the global textiles and apparel trade.

2.2. COTTON TEXTILE INDUSTRIES IN INDIA:

• From Ancient India to Modern India, cotton was the most important commodity traded.
Cotton textiles have been around since 1818 AD.
• In India, cotton textile centres are located in four regions: the Western Region,
the Southern Region, the Northern Region, and the Eastern Region.
• The first cotton cloth mill in India was established in Fort Gloster, near Kolkata, in 1818.

1
2.3. GROWTH AND DEVELOPMENT:

• The cotton textile industry was initially concentrated in Rajasthan, Maharashtra, and
Gujarat, where cotton was grown.
• Localization was aided by the availability of raw materials, the market, transportation,
labour, and a humid climate, among other factors.
• This industry was very important to Bombay's economy in the early twentieth century, but
it quickly declined after independence.
• As a result of the partition, most of the long-staple cotton-growing areas went to Pakistan
in 1947, causing the industry to suffer a serious setback.
• The majority of cotton mills, however, remained in India. India faced a severe shortage of
raw cotton as a result of these circumstances.
• In Maharashtra, Gujarat, and Tamil Nadu, spinning is still centralised, but weaving is
highly decentralised.
• There are 1,946 cotton textile mills in India as of 30 November 2011 with about 80% in
the private sector and the rest in the public and cooperative sectors.
• There are thousands of small factories with three to ten looms in addition to these.

2.4. PRESENT POSITION:

• Cotton textiles are currently India's largest organised modern industry.

• This industry has grown at a phenomenal rate over the last four decades.
• This industry employs about 16% of the country's industrial capital and over 20% of the
country's industrial labour.
• The total number of people employed in this industry is well over 15 million.
• Currently, the country has 1,719 textile mills, with 188 in the public sector, 147 in the
cooperative sector, and 1,384 in the private sector.
• Three-quarters of the mills were spinning mills, with the remaining one-fourth being
composite mills.
• Aside from mills, there are tens of thousands of small factories with 5 to 10 looms.

2
2.5. LOCATIONAL FACTORS:

• The availability of raw cotton, the market, transportation, and other factors all play a role
in the localization of the cotton textile industry.
• The importance of raw cotton is demonstrated by the fact that 80 percent of the industry
is located in the country's cotton-growing regions.
• It's also worth noting that cotton is a pure raw material in the sense that it doesn't lose much
weight during the manufacturing process, and any weight loss is more than offset by the
use of sizing materials.
• The cost of transporting raw cotton and finished cloth is not significantly different. Both
can be transported with ease and without significantly increasing the overall cost of
production.
• As a result, this industry is more likely to be found in cities with good transportation
connections to the market.
• To put it another way, it is primarily a market-driven industry. With
its tropical and subtropical climate, India's cotton textile industry has a huge market
potential.
• Despite the fact that West Bengal, Bihar, Uttar Pradesh, Kerala, and Orissa do not grow
cotton, they still have a large number of large cities where the cotton textile industry
thrives.
• Although cotton textile manufacturing was once concentrated in Mumbai during the early
stages of industrialisation, it has since spread across the country and now covers nearly the
entire country.
• Because it was a traditional cottage industry, there was plenty of low-cost, skilled labour.
• The most striking feature of the industry's distribution is that, even within a state, it is
concentrated in specific areas and regions, almost to the exclusion of others.

3
2.6. CHALLENGES:

2.6.1. SCARCITY OF RAW COTTON

• The Indian cotton textile industry suffered greatly as a result of partition, as most long
staple cotton growing areas were transferred to Pakistan.
• Although much progress has been made in improving raw cotton production, supply has
always lagged behind demand.
• As a result, imports are used to meet a large portion of the long staple cotton needs.

2.6.2. OUTDATED MACHINERY

• The majority of textile mills are old and have out-of-date machinery.
• As a result, productivity is low and quality is poor.
• Textile machinery installed even 10-15 years ago in developed countries has become
outdated and obsolete, whereas in India, 60-75 percent of machinery is 25-30 years old.
• Only 18-20% of looms in India are automatic, whereas the percentage of automatic looms
in Hong Kong and the United States ranges from 0% to 100% in Canada, 92 percent in
Sweden, 83 percent in Norway, 76% in Denmark, 70% in Australia, 60% in Pakistan, and
45 percent in China.

2.6.3. ERRATIC POWER SUPPLY

The power supply to most cotton textile mills is erratic and insufficient, which has a
negative impact on production.

2.6.4. LOW LABOUR PRODUCTIVITY

• In comparison to some advanced countries, India's labour productivity is extremely low.

• A worker in India handles about two looms on average, compared to 30 looms in Japan
and 60 looms in the United States.

4
 • If an American worker's productivity is 100, the corresponding figure for the United
Kingdom is 51.
• Japan received 33 points, while India received only 13.

2.6.5. STRIKES

• While labour strikes are common in the industrial sector, the cotton textile industry suffers
greatly as a result of frequent strikes.
• The organised sector suffered a severe setback as a result of the long-running strike in
1980.
• It took the government almost 23 years to realise this and pass legislation to support the
organised sector.

2.6.6. TOUGH COMPETITION

The Indian cotton mill industry is up against stiff competition from the power loom and
handloom industries, synthetic fibres, and foreign products.

2.6.7. SICK MILLS

• The above factors, acting singly or in combination, have resulted in a large number of sick
mills.
• A total of 177 mills have been labelled "sick mills."
• The National Textile Corporation, which was founded in 1975, has worked to eliminate
sick mills and has taken over the management of 125 sick mills.
• The fact that 483 mills have already closed is alarming.

2.7. SIGNIFICANCE

• India is the world's second-largest cotton producer, with the world's largest cotton-growing
area.

5
 • In comparison to other countries, it has a competitive advantage in low-cost cotton
sourcing.
• The average wage rate in India is 50-60% lower than in developed countries, allowing
India to benefit from global outsourcing trends in labour-intensive industries like
garments and home textiles.
• Design and fashion capabilities have helped Indian companies strengthen their
relationships with global retailers and gain a competitive advantage over their Chinese
counterparts.
• Installations for production: From spinning to garment manufacturing, production
facilities are available throughout the textile value chain.
• The industry is investing in technology and expanding its capabilities, which will prove
to be a valuable asset in the coming years.
• Arvind Mills and Welspun India are two major Indian players.
• In the global market, Alok Industries and Raymonds have established themselves as
'quantity producers.'

2.8. GOVERNMENT INITIATIVES

• The Indian government has enacted a number of textile export promotion policies.
• Under the automatic route, it has also allowed 100 percent FDI in the sector.
• The Union Minister for Commerce and Industry, Textiles, Consumer Affairs, Food &
Public Distribution announced in October 2021 the establishment of 100 textile
machinery champions in the country to promote the industry in the global market.
• The government hopes that by doing so, India will become a global player in textile
machinery.
• The Weaver MUDRA Scheme was established to assist handloom weavers/weaver
entrepreneurs by providing margin money assistance of 20% of the loan amount up to a
maximum of Rs. 10,000 per weaver.
• The loan comes with a 6-percentage-point interest rate and a three-year credit guarantee.

6
2.9. EXPORTS

• Cotton textiles are a major export from India. Cotton yarn, cloth, and ready-to-wear
garments are among India's most important exports.
• Indian garments are well-known for their quality and design around the world, and they
are widely accepted in the fashion industry. It is undeniable that readymade garment
exports have increased dramatically since 1960-61.
• In August 1999, the Export Committee on Textile Policy, which was established in 1998,
submitted its report to the government.
• One of the major goals set forth in the Textile Policy 2000 was to increase textile and
apparel exports from $ 11 billion to $ 50 billion by 2010, with garments accounting for $
25 billion of that total.
• The United States, Russia, the United Kingdom, France, East European countries,
Australia, New Zealand, Nepal, Singapore, Sri Lanka, and some African countries are
the main destinations for our exports.

3. POWER LOOM AND AUTO LOOM

3.1. POWER LOOM

A power loom is a mechanized loom, and was one of the key developments in the
industrialization of weaving during the early Industrial Revolution. The first power loom was
designed in 1786 by Edmund Cartwright and first built that same year. The traditional handloom
s and textile mills were trying to fix their places in the industry. But both of them have certain
limitations, it gave a chance to rise Power loom as a third pillar in the industry to overcome these
limitations. Handloom s at the one hand has the least speedy production at higher cost and mills
on the other hand require huge capital investments and scientific advanced technology. For speedy
production on a small scale at distant places, the weavers started installing Power loom as
‘decentralized’ units.

7
3.1.1. USAGE AND IMPORTANCE

A loom is a device that is used to weave together threads in order to produce a fabric.
Traditional handlooms were slow and required several labourers to operate. Cartwright's invention
of the power loom was significant because it used mechanization to automate much of the weaving
process.

3.1.2. TYPES OF POWER LOOM

3.1.2.1. AIR JET LOOM

This looms use a jet of air to propel the filling yarn strength the shed. It requires uniform
filling yarn. They are suitable for use with medium weight yarns then very light and very heavy
yarn

FEATURES

• Power consumption less

• Much production std. Fabric and light to medium fabric produced
• Air jet std. Width 190 cm.
• Highest weft insertion perform (600 ppm)
• Multicolour weft insertion up to 8.

3.1.2.2. WATER JET LOOM

A pre-measured length of filling yarn is carried across the loom by a jet of water.lt can
produce superior quality of fabrics.

FEATURES

• This type of loom is suitable for non absorbent fibre like synthetic fabric
• Less power consumption
• Highest weft insertion (600 ppm)

8
 • weft yarn package weight 3.6-4. I kg
• Treated water are used by a pump nozzle.

3.1.2.3. RAPIER LOOM

These looms are competitors to the missile looms. There are two types of rapier looms. Long
rapier & double rapier long/single rapier that carries the weft across the width from one side of the
loom to another. Double rapier that is one on each side of the loom. One rapier feeds the filling
yarn halfway through the shed of warp yarn to the arm the other side, which reach in and takes it
across the rest of the way.

FEATURES

• Fancy fabric produced

• Production costly
• Power consumption moderate
• Simple mechanism
• Suitable for weft patterning
• Standard rapier width 190 cm.

3.1.2.4. PROJECTILE LOOM

This picking action is accomplished by a series of small bullet projectiles which grip the filing
yarn and carry it through the shed and return empty.

FEATURES

• Accommodator used to reduce tension

• Power consumption is less (3 km-hr)
• Of projectile Il to 17
• Width minimum of 190 cm
• Width maximum of 540 cm

9
 • Multiple fabric produce
• A double beam single fabric can be produced in the projectile.

3.1.2.5. MULTIPLE SHUTTLE LOOM

More than one tape is produced. More than one shuttle is used, Shuttle are traversed on belt
No. Of shuttle tapes are placed on race board grove length of shuttle=3″, length of pirn —2″

3.1.2.6. NEEDLE LOOM

This type of loom, one angular needle always carries the yarn horizontally. Weft yarn comes
from the top of the machine; the latch needle makes the loop at one side of the selvage. No. Of
tapes/one loom obtained.

3.1.3. POWER LOOM INDUSTRIES IN INDIA

After independence many units in the mill sector started facing the problems. The
technological changes were the need of the time and the mill sector could not meet this
requirement. The labour problem also got multiplied due to the non-availability of skilled and
trained workers. This resulted in a high cost of production and heavy losses to many units and
finally closer to the mills. This adverse situation of mills also helped power looms to prosper fast.
The factors like the wars, failure of mills, and the reservation for the handloom s helped power
loom units to prosper very fast. All these are the external factors. Some internal factors also helped
a lot in the development of these units. The very nature of the decentralized power looms is such
that:

• It has reduced strain of operations

• It is less expensive

• Its instalments are very easy because these are very small units.

• No labour laws are applicable.

10
 All these favourable factors led the power loom sector to develop in small villages in the
hands of small entrepreneurs and in scattered and far off areas. But this development is entirely
unplanned. Today the power loom sector has developed a controversial subject. At one end. the
handloom s- the traditional weaving says that the power loom units are eating its share in
production and development and that’s why handloom s are lacking behind. Secondly handloom s
cannot compete with the power looms because of their speedy production. At the other end the
organized mill’s complains that many units are becoming sick because of power looms.

India manufactures 5% of cloth through the organized sector, 20% through the Handloom
sector, 15% through the knitting sector, and 60% of Indian cloth is produced through the
decentralized power loom sector.

The decentralized power loom sector is the lifeline of the Indian Textile Industry. India is
having approximately 19.42 lakhs of power looms weaving almost 19,000 million meters of fabric,
and provides employment to more than 7 million workers. The industry now produces a wide range
of fabrics ranging from grey, printed fabric, dyed fabric, cotton fabric, a various mix of cotton,
synthetic, and other fibres. The country exports Rs. 44,000 million worth of goods to countries
like the U.S.A., France, Germany, Bangladesh, Hong Kong, Italy, etc.

Although the growth of the power loom industry was slow initially; it has started gearing
up now. The number of shuttle less looms has augmented to almost 50,000 and from this about
35,000 looms are working in the decentralized sector.

Most of the Power loom units are concentrated in semi-urban, or rural areas. Among all;
Maharashtra has the highest number of power looms amounting to approximately 8 lakhs of the
power loom, Tamilnadu is second with 5 lakh units, and Gujarat ranks third with 4to4.5 lakh worth
of power looms.

11
3.2. AUTO LOOM

An automatic loom is basically one that has auto pirn changing mechanism along with all
the automatic warp and weft stop motions as well as positive let off motions. Shuttle less loom
: Shuttle less loom may be of the type of air jet, water jet, projectile, rapier etc. In
1924, Toyoda invented the Type-G Toyoda automatic loom with non-stop shuttle change motion,
the first of its kind in the world. The Type-G Toyoda automatic loom was a ground-breaking
invention containing a number of features such as automatic thread replenishment without any
drop in the weaving speed.

3.2.1. ADVANTAGES OF AUTO LOOM

The automatic looms include methods of holding the yarn such as rapier and the gripper. It
has advantages of higher productivity in comparison to water jet and air jet looms that use water
or pressurised air to transport the yarn with multiple colour weft insertion.

3.2.2 WORKING OF AUTO LOOM

Automatically replenished flat, or automatic, looms are the most important class of modern
loom, available for a very wide range of fabrics. In virtually all such looms, the shuttle is
replenished by automatically replacing the exhausted bobbin with a full one.

3.3 DIFFERENCE BETWEEN POWER LOOM AND AUTO LOOM

Power loom is a type of loom which is operated by power and the other side auto loom has
so many automatic function, sensor and thus output of auto looms are more finer than Power loom.
We can get less weaving defect in auto loom fabric.

A power loom is a mechanical loom, that is powered by a line shaft. A auto loom is a loom
with a tertiary motion to keep it from breaking.

12
 4. SOUTH INDIAN TEXTILE INDUSTRY

South India is well known for its natural beauty, but along with that also famous for its
textile industry. Coimbatore, Tirupur, Salem and Erode all four major cities of Tamilnadu have
their contribution in the growth of this industry. All these major cities are very much known for
different products. Coimbatore, a city residing in the hills of Nilgiris is a second largest in
Tamilnadu. This is also known as a cotton town. Kovai is the other name of Coimbatore. It has a
flare of cotton production because of the black soil of that land which suits cotton growing. If
Coimbatore is known for cotton production, Tirupur is known for knitting. Tirupur is also known
as a knit city. It is 50 kms far away in the east from Coimbatore. Tirupur has many cotton ginning
factories and has main cotton market of Tamilnadu. 35 countries are buying from Tirupur and they
are visiting that regularly. Tirupur is the only city which is doing 56% of knitwear export alone.
That is the reason why it is known as Town of Export Excellence. Tirupur is very near to
Coimbatore and that is an advantage for it. Because of its nearness to Coimbatore, Tirupur gets
benefits of cotton growing. The city Erode is known for handloom weaving and carpet . It also has
large scale cotton ginning mills. Erode along with Salem is known as the home of textile weavers.

Coimbatore, Tirupur, Salem and Erode, these four are known as textile belt of south India
and the export revenue it generates is more than 25,000 crore. In it the share of only Tirupur is
11,000 crore and the expected rise is 20-25 percent. The expected flow of investment is 90,000
crore in this region in various textile activities during next five years. Rs. 50,000 crore will be used
only for the textile industry of the Coimbatore region. The future plan is till 2012 with the hope of
increase in export and production of textile is 2,70,000 crore and 4,95,000 crore. This belt has
2,000 textile mills, large and small both.

Coimbatore is known as the Manchester of South India. It has above 600 cotton mills
which manufacture blended yarns and cotton. The production of fabric is done by 10-15 mills,
some of them are Akshaya Textiles, Gobald, KPM Textiles, KG Denim, Prime Textiles, Southern
Textiles, Hindustan Textiles, Lakshmi mills, Gangotri and Premier. Among them branded ones are
very few. Tiber brand is owned by Gangotri Mills, it is a national level brand. Another national

13
level brand is Trigger which is owned by KG Denim. Most of the Textile Mills of South India
have joined South India Textile Research Association known as SITRA. This association helps the
textile units in research and development. Some companies have their own research and
development units. SITRA works for the welfare of the textile units of this region and submits 2-
3 projects every year to the ministry of textiles.

Above 100 mills have closed in Coimbatore and in its suburbs in the last ten years. The
reason for this closure is wrong estimates and frequent changes in policies of exports. With the
quota system they have a hope for bright future prospects.

Cotton is the crop growing in this region because of the black soil and so the farmers started
cultivating the cotton crop and it was the start of industrialisation. Growing and cultivating of
cotton prospered during the1920s-1930s. Now-a-days the crop cultivated in the southern region of
this belt is only 3-5 percent. Though there is a decline during 1930, Tamil Nadu makes 50 percent
production of cotton yarns in the country. The yarn which has 100 count is a high quality cotton
whereas 10s, 20s and 30s are other varieties of cotton yarn. .

Every month 35 countries visit Tirupur and it delivers samples of knitted garments in less
then 12 hours. Tirupur is very near to highway no. 47 so it is within the easy reach of the buyers.
It started from 1974 and now Tirupur is on the top of national total exports. Tirupur even supplied
garments to the last FIFA world cup. The aim was to achieve 10,000 crore target but the target
being achieved is 11,000 crore in exports. The business in domestic market is 5,000 crore. The
knitting industry is also in changing phase. The quotas have opened up new doors for the knitting
industry of Tirupur. The muli-fibre agreement gave new vibrant look to the textile clusters. The
midcap knitwear is expanding and has gathered more strength in financial structures. The new
opportunity is opened up in the domestic market for the Tirupur knitters.

In 1920, the manufacturing of hosiery product started but it took more 15 years to develop
first-hand operated hosiery firm. Grey and bleached vests were produced first time for the domestic
market in the 1960s.The other items were introduced in the 1970s. Textile industry is a big source
of employment in Tirupur, round about 6,000 units are working there. In it 2,500 people are getting

14
employment through garment making, 2,000 from knitting, 700 from dyeing, 300 from printing,
and 200 from embroidery work. The products produced by these textile groups are cardigans, t-
shirts, jerseys, undergarments, pullovers, blouses, skirts, sportswear and trousers. Many companies
from this group are doing exports beyond 100 crore. These knitwear units are doing 80% export
of total export from Tirupur.

One of the leading unit is Eastman Exports and its export revenue is 600 crore. Even it is
exporting knit wears to the global brands also. Other players in exports are Classic Polo, KPR,
Global Clothing, Mani Apparels, Jupiter, Charlize Garments, Arrow clothing and Text mills. Some
of the global brands require blended fabrics so these units are also making blended fabrics.

Tirupur textile industry is still facing some problems like labour shortage and
environmental problem, though it has acquired the goal of 11,000 crore in exports in the year 2006-
07.That Tirupur has no star hotels is also a great drawback for the exporters. Due to the lack of
star hotels most of the visitors stay in the Coimbatore and they visit Tirupur. So it causes
inconvenience to the foreigners and because of this the industry loses some of its business. Another
issue which affects is the shortage of skilled and unskilled labourers. Government is working on
this problem and offering high wages and minimum 200 working days in a year, but the
improvement is little. Local exporters are now asking for Tirupur as a different district. They are
feeling that it could prove its worth more if it is recognized as a separate district.

There is a Netaji Apparel Park between Perumanallur and Avinashi, in the outskirts of
Tirupur. Its area is about165 crores and has a set up of 60 big factories with the investments more
than 250 crores. The revenue of this business park is 5,000 crores per annum and the figures are
in the rising mode. 53 factories are part of this apparel park and 22,000 people are working here
still it has a shortage of 10,000 people. The park has facilities of courier service, telephone
exchange, sewage treatment, uninterrupted water supply and bank and very soon it will have
international standard hotels, a hostel for working women, and auditorium. The park will get new
look when the national highway to the park will have six lanes. This new road will give
connectivity to Tirupur, Karur, Erode, Kerala and Coimbatore.

15
 Official records show that in rural and urban groups, there are 1,232 Handloom Weavers
Cooperative Societies of Tamil Nadu. In earlier days the handloom and carpet weaving prospered
in Salem and Erode but now with the changing times power looms have replaced those age-old
handlooms. Salem was very well known for its handloom products like dhotis and pure silk saris.
Now-a-days only 20,000 handlooms are functioning. Most of the handlooms are replaced with
power looms.

In these days Salem and Erode both the villages have no. of weavers who can weave cotton,
silk and polyester. Very few weavers can use blends. The Handloom Weavers� Cooperative
Societies of this region do exports of many things like bedcovers, bedspreads, table cloth, screen
cloth, towels and table mats to the countries like France, Germany, United Kingdom, United States
and the Middle East. This industry provides echo-friendly products.

Earlier people were weaving beautiful clothes sitting in their homes. But now the time has
changed and everyone wants to set up a mill and wants to make more money. In Tamil Nadu there
are 4.50 lakh power looms and the power loom section of Tamil Nadu is the second large following
Maharashtra. Normally 20 percent workers come from Salem and Erode and from the other area
of the textile belt of south. The cloth which is mainly produced by these power looms is for free
schemes like free saris, free dhotis and free school uniforms. The cloth produced by this society is
near about 1,000 lakh metres. Right now the power loom industry has two great challenges, one is
low productivity and the other is low level of skills. The government has approved grants to this
region still they are not getting those grants. Still some more changes are needed in infrastructure.

16
Today, the contribution from Tirupur to India's cotton knitwear exports is a staggering 90 per
cent. In 2014-15, it contributed to exports worth more than ₹20,000 crore. It is no wonder that it
is often called 'Dollar City' as well. Tirupur provides employment to thousands of people in and
around the town.

5. ACCOUNTING

Accounting is the process of recording financial transactions pertaining to a business. The

accounting process includes summarizing, analysing, and reporting these transactions to oversight
agencies, regulators, and tax collection entities. The financial statements used in accounting are
a concise summary of financial transactions over an accounting period, summarizing a company's
operations, financial position, and cash flows

5.1. JUNIOR ACCOUNTANT

A junior accountant is a finance professional who is primarily responsible for maintaining

and compiling financial reports and statements while ensuring that they are compliant with the
applicable regulatory requirements.

17
 Some of the core responsibilities of a junior accountant include analysis of balance sheets,
management of ledger accounts, updating of financial statements, maintenance of receivables&
payables, payment of monthly payroll, and preparation of financial reports. A junior accountant
plays a critical role in an organizational set-up irrespective of whether it is a large multinational
company or a small domestic entity ,the accountants start their career at the entry-level in the role
of junior accountants and then gradually grow with time as they gain more experience and they
take up more responsibilities to become managers or even partners in their firm.

5.1.1. DUTIES AND RESPONSIBILITIES

The role of the junior accountant is best suited for those candidates who are interested in
finance profile and have special mathematical skills. A junior accountant usually reports to a senior
accountant or an accounting manager.

The job responsibilities of a junior accountant might vary across organizations, however,
some of the most duties and responsibilities of a junior accountant are as follows:

• Posting and processing journal entries ensuring that all the business transactions are
properly recorded
• Continuous tracking and monitor of the accounts receivable and accounts payable.
• Issuing and preparing trade invoices and reconciling the entries from time to time.
• Assisting in the preparation and processing of the financial statements, such as income
statement, balance sheet, cash flow statement, etc.
• Ensuring that all financial reporting adheres to the legal and regulatory guidelines
applicable to the organization.
• Collaborating with other departments, such as Marketing, Operations, and HR, while
reviewing the organizational expenses.
• Updating financial information in a timely manner.
• Ensuring that all the recorded information is accurate. In the case of any kind of inaccuracy,
immediately communicate the same to the superiors.

18
 • Keeping track of the key performance indicators (KPIs) of the organization and preparing
reports for the senior management.
• Supporting the senior accountants and assisting them with other accounting projects as
when and needed.

5.1.2. QUALIFICATIONS

Although the minimum educational requirement for the role of a junior accountant is an
undergraduate degree, the aspiring candidates can either be in a higher qualification/ certification
or pursue a post-graduation degree in order to enhance their employability.

1. EDUCATION

An entry-level accountant must hold a bachelor’s degree in the field of accounting,

finance,or other related disciplines. However, some of the employers prefer candidates who
possess a master’s degree in accounting or taxation or even an MBA degree with finance
specialization.

2. CERTIFICATIONS

If the role of a junior accountant involves filing documents with the U.S. Securities and
Exchange Commission (SEC), then the additional qualification of Certified Public Accountant
(CPA) is definitely preferable. In fact, there are various other certifications or higher qualifications
available, such as ACA, ACCA, CIMA, etc., that an aspiring candidate can pursue in order to stay
ahead of the competition of the job market. These higher qualifications indicate that the aspiring
candidate possesses expertise in a specialized field.

Some of the other desirable attributes for a junior accountant job includes analytical
ability, mathematical aptitude, deep interest in finance, eye for detail, and ability to keep things
well organized. Also, a junior accountant should be technologically sound as the role might involve
learning new accounting software owing to changing accounting requirements coupled with
growing technological advancement.

19
5.1.3. SALARY

Typically, junior accountants enjoy above-average earning potential as they have access to a
wide range of clientele. However, the starting compensation of each junior accountant usually
varies and it depends on various factors, such as the location & size of the employer, the tasks that
they handle, their experience & qualification in the relevant field. As they gain experience and
own up more responsibilities, their salary also increases accordingly.

The average salary of junior accountants lies in the vicinity of $41k per annum, wherein the
junior accountants with experience of less than a year get somewhere in the range of $27k to $50k
per annum and those with experience of more than two decades can earn up to $70k per annum.

In the United States, a junior accountant typically earns a salary that is 60 to 70 percent of a
senior accountant's salary.

5.1.4. CAREER OPPORTUNITIES

The growth of employment opportunities for the accounting role is positively correlated to
the economic growth of a country. Hence, healthy economic growth results in the creation of more
accounting jobs.

Further, the demand for accounting jobs also increases with the introduction of new and
changing accounting rules as both public and private sector companies need to hire more and more
accounting professionals.

In fact, in some cases, the junior accountants with exceptional knowledge in their field get
promoted to the role of senior accountants, auditors, accounting supervisors, etc.

According to the bureau of labour statistics, the growth in the employment opportunities
for accountants in the US during the period from 2019 to 2029 is expected to be average at 4%.

20
5.1.5. IMPORTANCE OF ACCOUNTANT

Although people often refer to accountants as “bean counters” who focus on the smallest
details, accountants have the rare advantage of being able to understand both the details of each
area of a company and the big picture. This broad and deep knowledge is why CEOs often come
from the ranks of accounting and finance.

Many accountants seek certifications to evidence their attainment of certain levels of

professional competence. These certifications include Certified Professional Accountant (CPA),
Certified Management Accountant (CMA), and Certified Internal Auditor (CIA). Some
accountants also specialize in certain areas of accounting,, such as tax, oil and gas accounting,
forensic accounting (bankruptcy), or international accounting.

Effective accountants must be able to solve problems creatively and analyse information
to gain insight into situations.They must also be able to persuasively discuss and defend their
views, stay abreast of new e-commerce and software technologies, manage projects and deadlines,
and have the confidence to make recommendations and policies that affect an entire organization.

Above all, successful accountants are good communicators and rigorously follow the law
and accounting rules.

5.1.6. REQUISITES OF JUNIOR ACCOUNTANT

The measure to their competent performance is their attention to accuracy and detail. This
incorporates the ability to analyse issues and skills to solve problems in an efficient manner.
Moreover, top-notch communication skills are central to the planning, organizing and scheduling
projects by priority. As a basic knowledge, a Junior Accountant must possess a four-year college
degree, the Bachelor of Science in Accounting or any other related courses.

It is possible to accept employment only after completing 75% of this degree. Besides,
some of the best positions can be acquired through the ability to use accounting software in
addition to having a Master’s degree, or a license or certification.

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 6. INTERNSHIP ACTIVITIES

6.1. TABLE SHOWING ACTIVITIES DONE IN EACH DATE OF THE INTERNSHIP

PROGRAM FROM 11th JULY 2022 TO 27th JULY 2022

DATE ACTIVITIES

11/07/2022 Introduction to employees and explanation about company

12/07/2022 Changed journal entries into Ledger Accounts

13/07/2022 Posted Ledger accounts in tally software

14/07/2022 Created Accounting vouchers using the posted ledgers

15/07/2022 Arranged all the bills according to the date & uploaded them to the senior accountant

16/07/2022 Attended weekly meeting to discuss the issues faced & the procedures learnt

18/07/2022 Learnt to do income tax registration

19/07/2022 Learnt how to pay income tax online

20/07/2022 Learnt to do online registration for paying GST

21/07/2022 Learnt to pay GST through online

22/07/2022 Updated account receivable and issued invoices

23/07/2022 Attended weekly meeting and suggested my opinion on the company

25/07/2022 Calculated payroll taxes

26/07/2022 Assisted senior accountant in completing audits

Ended my internship by giving feedback to the company & revised the learnt things with
27/07/2022
my senior accountant
6.2. INTRODUCTION AND EXPLANATION

As 11/07/2022 was my first day, I gave self introduction to my fellow employees and exchanged
some details. My senior gave the detailed explanation about the company’s work and how the
process is being done. He explained the role of Junior accountant. He asked several basic questions
related to accounting and journal entries. As I have learnt some basics of accounting in my college
syllabus, it was quite easy to answer those questions.

6.2.1. WORK PROCESS OF THE COMPANY

The company provides required threads to the power loom owners and takes their good down for
lease. It takes the cloth material produced by these power looms in return and the company exports
these cotton fabrics to various parts of textile industry.

6.3. JOURNAL

A journal is a detailed account that records all the financial transactions of a business, to be
used for the future reconciling of accounts and the transfer of information to other official
accounting records, such as the general ledger.

6.3.1. JOURNAL ENTRIES

A journal entry is the act of keeping or making records of any transactions either economic or non-
economic. Transactions are listed in an accounting journal that shows a company's debit and credit
balances. The journal entry can consist of several recordings, each of which is either a debit or a
credit.Journal gives you a running list of business transactions. Each line in a journal is known as
a entry. And, each journal entry provides specific information about the transaction, including:

• Date of the transaction

• Description / Notes
• Account name
• Amount

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6.4. LEDGER

An accounting ledger is an account or record used to store bookkeeping entries for

balance-sheet and income-statement transactions. Accounting ledger journal entries can
include accounts like cash, accounts receivable, investments, inventory, accounts payable, accrued
expenses, and customer deposits.

A ledger account contains a record of business transactions. It is a separate record within

the general ledger that is assigned to a specific asset, liability, equity item, revenue type, or
expense type.

Information is stored in a ledger account with beginning and ending balances, which
are adjusted during an accounting period with debits and credits. Individual transactions are
identified within a ledger account with a transaction number or other notation, so that one can
research the reason why a transaction was entered into a ledger account. Transactions may be
caused by normal business activity, such as billing customers or recording supplier invoices,
or they may involve adjusting entries, which call for the use of journal entries.

There are five main account types in a general ledger:

• Assets
• Liabilities
• Equity
• Revenue / Income
• Expenses

Each account type can have various sub-accounts within them. For example, assets may include
checking or saving accounts.

6.4.1. IMPORTANCE OF LEDGER ENTRIES

There are a number of reasons why ledger entries are oh-so important. Ledger entries:

24
 • Keep you organized
• Make it easier to find transactions
• Compartmentalize transactions
• Let you see the big picture of your company’s financial health
• Show you patterns in income and expenses
Along with the above perks, posting entries to the general ledger helps you catch accounting
mistakes in your records.

Catching mistakes early on helps you steer clear of bigger problems down the road, like inaccurate
financial reports and tax filings.

Keeping your ledger up-to-date can help you avoid penalties and ensure that your records give you
an accurate picture of your business’s finances.

6.4.2. CONVERTING JOURNAL ENTRIES TO LEDGER ACCOUNTS

Posting into ledger is made from journal entries passed in the journal. It is important to
mention that every journal entry will have to be posted into all accounts which have been debited
and credited in the journal entry. For goods purchased for cash. Purchases Account is debited and
Cash Account is credited. While posting this entry into ledger, it will be posted both in Purchase
Account as well as in Cash Account.

Posting will be made on debit side of the account which has been debited in the journal
entry and, similarly, on credit side of the account which has been credited in the journal entry.
Remember, the postings into ledger account will be made in chronological manner (date-wise).

In the particular column, the name of the account (preceded by ‘To’) credited in the journal
entry will be written. Similarly, while posting on the credit side of the account, we shall write the
name of the account (preceded by ‘By’) debited in the journal entry.

The amount of journal entry will be shown in the amount columns of both accounts and
finally accounts will be balanced. Balance in an account signifies the net result of all transactions

25
relating to it during a given period of time. For example, the balance in personal account will
indicate whether the business owes to the party or the party concerned owes to the business.

The debit balance in a personal account i.e., excess of debit total over its credit total, shows
that the party concerned owes to the business. On the contrary, in case of credit balance in personal
account, it indicates that the business owes to the party concerned.

All real accounts relate to assets, hence, show the debit balance only. The balance in nominal
accounts indicate profit (in case of credit balance) and loss (in case of debit balance). The balance in
nominal accounts are transferred to Profit and Loss Account.

6.5. TALLY ERP 9

Tally.ERP 9 is one of the most popular accounting software used in India. It is complete enterprise
software for small & medium enterprises.

Tally.ERP 9 is a perfect business management solution and GST software with an ideal
combination of function, control, and in-built customisability.

Tally.ERP 9 permits business owners and their associates to interact more in accounts related
discussions and is a complete product that retains its original simplicity yet offers comprehensive
business functionalities such as Accounting, Finance, Inventory, Sales, Purchase, Point of Sales,
Manufacturing, Costing, Job Costing, Payroll and Branch Management along with compliance
capabilities for Excise, TDS, TCS, and now GST too.

6.5.1. CREATING LEDGERS

Step 1: Open Create Ledger window by following the given direction: Gateway of Tally >
Account’s Info > Ledger > Create

Step 2: Select the group. Here we will be required to select as to which group the ledger will be
assigned to. Choosing the right group is important, as it will affect how numbers and sales are
totalled later

26
Step 3: Give the ledger a name. Enter a name for your ledger to know what the ledger contains in
it without having to open it

Step 4: Enter an opening balance (if any).For Example: If you are creating a ledger for your bank
account, this would be the amount currently in it. If you are starting a ledger for the amount owed
to a Vendor, the amount you owe would be the starting balance

6.6. ACCOUNTING VOUCHERS

A voucher in accounting is a document normally issued by the accounts payable department to

authorise payments. It can also be termed as a memorandum of liability to any organisation.
An accounting voucher can be seen as a written backup document for the payments done to the
suppliers or creditors in any organisation for the business conducted with the party.

This document plays an important role in initiating the process of clearance of liability. All the
other related documents can be collected and verified with the use of a voucher. The accounting
vouchers in tally also have a hand in putting up the appropriate control mechanism.The accounts
payable department has to ensure that every payment made to the supplier is,

• Authorised appropriately
• The goods and services are received against the payment
• The payment is as per the agreement that pre-exists

When a voucher is issued for payment, it implies that all these prerequisites of the control
mechanism process are fulfilled, and the payment towards the supplier is good to go.

6.6.1. COMPONENTS OF ACCOUNTING VOUCHERS

A voucher accounting is typically a part of a manual payment system with a strong control
mechanism. The vouchers are prepared with the help of source documents such as challans,
counterfoils, cheque books, receipts, bank deposit slips, bills, cash memos, and other information.

27
The source documents are relevant to the financial transaction and also vouch for the existence of
such transactions.

The data and information on a voucher normally contain are as mentioned below:

• Voucher number
• Date and types of accounting vouchers
• Credit and debit column
• Particulars column- It includes a brief description of the record of the transaction
• Identification Number of the supplier
• The amount payable in words and figures
• Column for total
• The due date for payment
• Name of the account under which liability is created
• Terms and conditions for a discount or other schemes
• Approval stamp and signature of accountant
• Authorised signature of the higher authority
• Receiver's signature

Preparation of the accounting vouchers can be a tricky job. The accountant has to be vigilant while
preparing the vouchers for the transaction that takes place. Every minute detail should be
thoroughly checked and verified. Some of the major points that the accountant should take care of
while preparing the voucher are mentioned below:

• The supporting documents should be thoroughly verified.

• An authorised signatory should sign the supporting documents of the voucher.
• The accountant should use appropriate types of voucher relevant to the transaction.
• The credit and debit sides of the voucher should be tallied and balanced.

28
 • It is most essential for the accountant to ensure that the voucher has the correct account
head mentioned. This would ensure that the transaction is recorded properly in the books
of accounts.

6.6.2. TYPES OF ACCOUNTING VOUCHERS

Along with the knowledge about the meaning of vouchers in accounting, the accountant should
also have thorough knowledge about the types of vouchers. This assists the accountant to prepare
an appropriate voucher with regard and relevant to the financial transaction. Also, different types
of vouchers have different meanings and implications.

The several types of vouchers are mentioned below:

1. Receipt Voucher
The bank or cash receipts are recorded through a receipt voucher. The receipt voucher is of two
types, namely bank receipt voucher and cash receipt voucher. A cash receipt voucher is prepared
for the amount received in cash. The bank receipt vouchers record the receipt of the demand draft
or cheque. This implies that the amount is received in the bank instead of cash.

2. Payment Voucher
The payment voucher is opposite to the receipt voucher. While receipt voucher poses the inflow
of funds, payment voucher depicts the transactions that have an outflow of funds. The focus of
preparing payment vouchers is to record the cash and bank transactions for payment in an
organisation.

Similar to receipt vouchers, payment vouchers are also of two types: bank payment vouchers and
cash payment vouchers. The payments in an organisation through cash are recorded in
a cash payment voucher, while those done through demand draft or cheque are recorded
in bank payment voucher.

29
3. Journal Voucher
Journal vouchers are also known as transfer vouchers or non-cash vouchers. All the transactions
that do not involve cash or bank transactions or inflow and outflow of amounts are passed through
journal vouchers. They are authentic documentary proof for the financial transaction.For instance,
when the goods are sold on credit and there is no immediate cash or bank transaction, the journal
voucher is prepared for such a transaction. The debtor is debited with the sales amount, and
the sales account is credited to pass the accounting entry.

4. Sales Voucher
Any sales transaction for the goods and services is passed through a sales voucher. The sales
voucher is prepared to record the cash and credit sales performed in the organisation. The relevant
debtor account is debited, and the sales account is credited. The sales voucher is the proof and acts
as evidence of the sales transaction for goods and services in the organisation.

5. Purchase Voucher
Purchase voucher records the transaction of purchase of goods and services in an organisation. The
purchase transaction may be through cash or bank or on credit. The relevant supplier is credited
when the purchase happens on credit. The purchase voucher is supported through several relevant
documents such as purchase order, supplier slip, and other documents relevant to the required
purchase.

6. Supporting Voucher
Any transaction that has been undertaken in the organisation in the past is documented through a
supporting voucher. It is written documentary proof for the past events in an organisation. For
example, to support the main voucher, supporting vouchers are attached with the expense bill.
Supporting vouchers such as fuel bills can act as proof of the transportation of an employee.

6.6.3. PROCESS OF USING ACCOUNTING VOUCHERS

The payment towards goods and services is not done immediately. It is usually due at a certain
future date. A delay of thirty, sixty, or ninety days is normally allowed for payment. So when the

30
organisation receives services or goods, they issue an accounting voucher as a reminder for the
payable amount.There is a certain process followed for creating a voucher. This is mentioned
below:

• An order for goods or services is placed to the supplier.

• The supplier acknowledges, confirms, and approves the order.
• The authorised person verifies that the goods and services received are as per the terms of
agreement or contract.
• According to the transaction, the voucher is created. It contains all the related and relevant
information about the transaction. The documents in support of the transaction are also
attached to the same.
• The organisation makes the payment after thoroughly checking the voucher and the
supporting documents and information.

The accounting vouchers contain all the related and relevant data and information about the
transaction. There are numerous documents attached to the accounting voucher. Some of the major
documents are mentioned below:

• The invoice from the supplier for the goods and services
• Basic details of the supplier such as telephone number, address, name, bank details, and
others.
• Details about the payment due such as amount, any discount, due date, and other details.
• Purchase order details.
• Confirmation of receipt stating that the goods or services are received as per the agreement
and the invoice.
• General ledger account to support the accounting purpose.
• Authorised signature to confirm and validate the purchase and the payment. This can be
any person who is authorised and is in charge of the transaction.
• Voucher documentation or the proof for the payment done.

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6.6.4. CREATING VOUCHERS

Understand the purpose of vouchers: It is a document that contains the details of a financial
transaction. These are used for all aspects of a business, from sales to deposits. Tally.ERP 9 comes
with several of the most popular types of vouchers pre-configured for usage.

How to create different vouchers?

Step 1: Open the vouchers screen using the following direction: Gateway of Tally > Accounting
Vouchers

For recording money deposited into or withdrawn from the bank, or for
F4: Contra : recording any sum transferred between two accounts in the same
company.

F5: Payment This voucher is used for payments made by the business.

For recording any income earned by the company (sales, rent, interest,
F6: Receipts
etc.) and for recording the proceeds received from Sundry debtors.
For recording all adjustment or due entries such as prepaid expense,
F7: Journal accrued income etc., For recording purchase of assets for recording Input
tax reversal entries, reverse charge entries under GST.

F8: Sales This is used for recording all the sales made by the company

This is used for recording all the inventories purchased by the company
F9: Purchase
in the course of business.
Step 2: In this step, we can choose the voucher we want to create. Here’s is the list :

Step 3: Enter the required information.

The information needed to complete the voucher will vary depending on the type of voucher
we want to create. We will have to typically need to determine which ledger the voucher will be
attached to, as well as enter the date and names of any involved parties.

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6.7. BILLS

A bill is an invoice received from a supplier, on which the supplier states the amount
owed by the recipient. This is the primary source document for trade payables. A unique
invoice number on the bill is entered by the receiving entity in its accounts payable system,
which uses the number in combination with the supplier name as the primary identifier for
the liability.

6.8. INCOME TAX

Income tax is a direct tax that a government levies on the income of its citizens. The Income
Tax Act, 1961, mandates that the central government collect this tax. The government can change
the income slabs and tax rates every year in its Union Budget. Income does not only mean money
earned in the form of salary.

6.8.1. SLABS

Indian Income tax levies tax on individual taxpayers on the basis of a slab system. Slab system
means different tax rates are prescribed for different ranges of income. It means the tax rates keep
increasing with an increase in the income of the taxpayer. This type of taxation enables progressive
and fair tax systems in the country. Such income tax slabs tend to undergo a change during every
budget. These slab rates are different for different categories of taxpayers. Income tax has
classified three categories of “individual “taxpayers such as :

• Individuals (aged less than of 60 years) including residents and non-residents

• Resident Senior citizens (60 to 80 years of age)

• Resident Super senior citizens (aged more than 80 years)

33

.
INCOME TAX SLAB RATE APPLICABLE FOR NEW TAX REGIME – FY 2020-21

INCOME TAX SLAB NEW REGIME INCOME TAX SLAB RATES FOR FY 2020-21

Rs 0.0 – Rs 2.5 Lakhs NIL

Rs 2.5 lakhs- Rs 5.00 Lakhs 5%

Rs. 5.00 lakhs- Rs 7.5 Lakhs 10%

Rs 7.5 lakhs – Rs 10.00 Lakhs 15%

Rs 10.00 lakhs – Rs. 12.50

20%
Lakhs
Rs. 12.5 lakhs- Rs. 15.00
25%
Lakhs

>Rs. 15 lakhs 30%

6.8.2. INCOME TAX REGISTRATION

Step 1: Click on this site www.incometax.gov.in & click register

Step 2 : In register as (Taxpayer/others) & Enter PAN number click validate.

Step 3 : Place confirm if you want to register as a individual tax payer (Yes/No) and then click
continue.

Step 4 : In next page enter last name as your name & select DOB, Gender, Residential
status(Resident/Non-Resident) then click continue.

Step 5 : In contact details enter [ Phone No, Mail ID, Landline NO] In postal address enter
[Country, Door NO. Street, Pin-code, Area].

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Step 6 : We get OTP for the mail id and phone no=> Enter that OTP & verify it. Once verify the
basic details then click continues.

Step 7 : For security purpose set password to secure your account then click proceed. We get
transaction ID.

If we need to check:

Home page => login => enters username=> password =>start filling.

6.8.3. PAYING INCOME TAX THROUGH ONLINE

Step 1 : Open the portal

Step 2 : After that fill all the necessary details click proceed => click make payment tab
automatically the page will go to E-payment of taxes in that click Non-TDS/TCS (challan
no/ITNS 280)

Step 3 : Click Tax applicant as income tax (other than companies)

Step 4 : Click type of payment =>self-assessment tax => mode of payment => net banking select
bank name

Step 5 : Fill all the mandatory details like: PAN NO. Assessment year, District, State, Pin-code,
Mail id, Mobile Number & enter captcha code.

Step 6 : Click proceed & check all the filled details => agree the terms and click submit to bank

Step 7 : Choose payment mode as pay as retail user.

Step 8 : Select pay from account to choose a/c no=> enter the payment amount of income tax.

Step 9 : Total amount displayed on screen automatically click continue and check the details.

Step 10 : After payment made successfully then note BSR code, Tender date, challan serial
number.

Step 11 : Click download PDF and save as document.

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Step 12 : In income tax portal click tax paid => advance &self-assessment tax payment. Step 13 -
Click show details & add another then fill BSR code, Tender date, challan serial no and amount
to be filled & click confirm.

6.9. GST

GST, or Goods and Services Tax, is an indirect tax imposed on the supply of goods and
services. It is a multi-stage, destination-oriented tax imposed on every value addition, replacing
multiple indirect taxes, including VAT, excise duty, service taxes, etc.

The goods and services tax is a value added tax levied on most goods and services sold for domestic
consumption. The GST is paid by consumers, but it is remitted to the government by the businesses
selling the goods and services. The tax is included in the final price and paid by consumers at point
of sale and passed to the government by the seller. It comes under indirect sales tax that is applied
to the cost of certain goods and services. The business person adds the cost of GST to the product,
and a customer who buys the product pays the sales price including GST and it is forwarded to the
government. It is also referred to as value-Added Tax (VAT) in some of the countries.

Website for GST : www.gstgov.in

GST was launched on 1st July 2017 in India.

There are four types of GSTs.

CGST = Central goods and service tax.

SGST = State goods and service tax.

IGST = Integrated goods and service tax.

UTGST = Union territory goods and service tax.

Depends upon the product GST rate will be varied.

CGST and SGST tax will be within India.

GST percentage will be divided equally for both CGST and SGST.

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IGST is for imports and exports.

Person who has to pay GST

• A person whose annual income is above 20 lakhs

• Import and export business persons.

6.9.1. REGISTRATION OF GST THROUGH ONLINE

Step 1: visit www.gstgov.in

Step 2: select tag pair and choose register now option

Step 3: choose new registration

Step 4: Fill the details which are listed in the form. After filling the details enter the captcha code
and click proceed.

Step 5: Then you will be receiving OTP for your Mobile Number and mail I'd which you mentioned
in the form.

Step 6: after verifying the OTP click proceed

Step 7: You will get temporary reference number. Make note of that for future purpose.

TRN will be valid for 15 days, within those 15 days we have to submit the document.

Requirement to register GST through online:

• Pan card (business)

• Aadhaar card
• Photo of the applicant
• Business details (mention full information)

6.9.2. PAYING GST THROUGH ONLINE

Step 1: Visit www.gstgov.in

Step 2: First go to login page enter username password and captcha code

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Step 3: After that click login

Step 4: After logging in select create challan which will be displayed on the screen

Step 5: Then enter tax liability amount (CGST, SGST)

Step 6: After entering the amount choose payment mode

Step 7: E-Payment is selected to online payment and click generate challan

Step 8: From that you have to select the mode of E-Payment (preferred banks or net banking)

Step 9: Select the bank click make payment choose (personal or corporate)

Step 10: The amount will be displayed on the screen once click the amount and click confirm.

Step 11: If the payment is successfully completed click view receipt and download it for
acknowledgement and click continue for return filing.

Click dashboard→→ file returning.

Make payment (post credit to ledger and make a filing).

6.10. ACCOUNTS RECEIVABLE

Accounts receivable (AR) is the balance of money due to a firm for goods or services delivered
or used but not yet paid for by customers. Accounts receivable are listed on the balance sheet
as a current asset. AR is any amount of money owed by customers for purchases made on credit.

6.11. INVOICE

An invoice, bill or tab is a commercial document issued by a seller to a buyer relating to a sale
transaction and indicating the products, quantities, and agreed-upon prices for products or services
the seller had provided the buyer. Payment terms are usually stated on the invoice.

Invoices can also serve as legal records, if they contain the names of the seller and client,
description and price of goods or services, and the terms of payment.

Issuing an invoice is the first step a seller will take to collect payment. Invoices establish an
obligation on behalf of the buyer to pay their supplier and serve as proof of debt owed.

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An invoice is important for the client or customer receiving it because it notifies them that a
payment is due and what the amount is. An invoice is also known as the “bill”. Invoices are
important for the business generating them because it prompts the payment process.

6.12. PAYROLL TAXES

A payroll tax is a percentage withheld from an employee's pay by an employer who pays it to the
government on the employee's behalf. The tax is based on wages, salaries, and tips paid to
employees. Federal payroll taxes are deducted directly from the employee's earnings and paid to
the Internal Revenue Service (IRS).

6.12.1. FEDERAL PAYROLL TAXES

The term federal payroll taxes refers to the taxes deducted to fund Medicare and Social
Security programs in the United States. These are labelled as MedFICA and FICA on pay stubs.
Federal income tax, which is also withheld from employee pay checks, goes into the general fund
of the U.S. Treasury.

6.13. AUDIT

Audit is the examination or inspection of various books of accounts by an auditor followed by

physical checking of inventory to make sure that all departments are following documented system
of recording transactions. It is done to ascertain the accuracy of financial statements provided by
the organisation.

Audit can be done internally by employees or heads of a particular department and externally by
an outside firm or an independent auditor. The idea is to check and verify the accounts by an
independent authority to ensure that all books of accounts are done in a fair manner and there is
no misrepresentation or fraud that is being conducted.

The purpose of an audit is the expression of an opinion as to whether the financial statements
are fairly presented in conformity with appropriate accounting principles. An audit plan
is the specific guideline to be followed when conducting an audit. it helps the auditor obtain
sufficient appropriate evidence for the circumstances, helps keep audit costs at a reasonable level,
and helps avoid misunderstandings with the client.

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6.14. CONCLUSION

Accounting plays a vital role in running a business because it helps you track income and
expenditures, ensure statutory compliance, and provide investors, management, and government
with quantitative financial information which can be used in making business decisions.

Financial records reflect the results of operations as well as the financial position of your small
business or corporation. In other words, they help you understand what’s going on with your
business financially. Not only will clean and up to date records help you keep track of expenses,
gross margin, and possible debt, but it will help you compare your current data with the previous
accounting records and allocate your budget appropriately.

Laws and regulations vary from state to state, but proper accounting systems and processes will
help you ensure statutory compliance when it comes to your business. The accounting function
will ensure that liabilities such as sales tax, VAT, income tax, and pension funds, to name a few,
are appropriately addressed.

Budgeting and future projections can make or break a business, and your financial records will
play a crucial role when it comes to it. Business trends and projections are based on historical
financial data to keep your operations profitable. This financial data is most appropriate when
provided by well-structured accounting processes. Businesses are required to file their financial
statements with the Registrar of Companies. Listed entities are required to file them with stock
exchanges, as well as for direct and indirect tax filing purposes. Needless to say, accounting plays
a critical role in all these scenarios.

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