PGDM End Term Examination – October 2023

Term 1 – PGDM 2023 – 25

Course Title: Financial Reporting and Analysis (FRA)
Faculty: Dr. K. Riyazahmed
Duration: 60 Minutes Max. Marks: 30
Mode of Exam: System-based (Excel and Word) Submission through Moodle.
Instructions to Candidates:
Answers to questions must be submitted in a Microsoft Word document, calculations must be submitted in a
Microsoft Excel file. There must be two document submissions.
CLO’s
ICLO 1 – To assess accounting principles for preparing financial reports.
ICLO 2 – To develop a structured accounting system to support financial decision-making.
ICLO 3 – To appraise various accounting and technical aspects in bringing accounts to final statements.
ICLO 4 – To evaluate the business performance through the contents of the annual reports.
ICLO 5 – To investigate the financial performance of manufacturing, service, and banking companies.

Answer all the questions

CLO 2 & 3 15 marks
1. In January 2023 Sathish started a business. The company had the following transactions in
January.
a) Started business with capital, ₹35,00,000.
b) Office equipment purchased for ₹250,000.
c) Bought machinery for ₹65,000.
d) Purchased raw material for ₹80,000.
e) Sold goods on credit to Sourav for ₹3,00,000.
f) Cash sales ₹ 3,50,000.
g) Collected payment from Sourav ₹ 2,95,000 and settled his account.
h) Sathish took his salary for ₹25,000.
i) Paid electric bills ₹ 4,500.
j) Paid office rent ₹12,500.
k) Sathish’s friend Tarun invested in the business ₹2,90,000.
In addition to the above, Sathish found the following information on his record.
 Outstanding bills ₹12,000.
 Goods returned to supplier ₹5,500.
 A customer paid ₹8,000 and has not yet received goods.
 Inventory is valued at ₹9,000.
Prepare a statement reflecting the effects based on the accounting equation method.

CLO 5 15 marks
2. You are appointed as a fundamental analyst of a leading brokerage firm. You have been tasked
with assessing the financial position of AL Limited for FY 2022 -23. Given below are the
financial statements of the company and the industry scenario.
a. How do you analyze the financial performance of a company? 5 marks
b. Evaluate the financial performance of AL Limited. Discuss the same and suggest areas of
improvement. 10 Marks.

PGDM Question Paper

 Balance Sheet (₹in Crores)

PGDM Question Paper

 Year 2023 2022
SOURCES OF FUNDS:
Share Capital 6,445.00 6,765.00
Reserves Total 6,53,884.00 7,72,720.00
Equity Application Money 39,843.00 0
Total Shareholders’ Funds 7,00,172.00 7,79,485.00
Minority Interest 99,260.00 1,09,499.00
Secured Loans 19,047.00 14,079.00
Unsecured Loans 3,59,915.00 3,05,079.00
Total Debt 3,78,962.00 3,19,158.00
Other Liabilities 17,743.00 14,485.00
Total Liabilities 10,96,137.00 12,22,627.00
APPLICATION OF FUNDS:
Gross Block 7,75,802.00 8,83,614.00
Less: Accumulated Depreciation 2,34,544.00 2,55,816.00
Less: Impairment of Assets 0 0
Net Block 5,41,258.00 6,27,798.00
Investments 3,64,828.00 3,94,264.00
Current Assets, Loans & Advances
Inventories 81,672.00 1,07,778.00
Sundry Debtors 19,014.00 23,640.00
Cash and Bank 17,397.00 36,178.00
Loans and Advances 1,02,482.00 71,305.00
Total Current Assets 2,20,565.00 2,38,901.00
Less: Current Liabilities and
Provisions
Current Liabilities 1,85,570.00 2,25,458.00
Provisions 2,504.00 1,936.00
Total Current Liabilities 1,88,074.00 2,27,394.00
Net Current Assets 32,491.00 11,507.00
Deferred Tax Assets 22,593.00 18,854.00
Deferred Tax Liability 58,447.00 67,455.00
Net Deferred Tax -35,854.00 -48,601.00
Other Assets 67,461.00 65,153.00
10,96,137.0 12,22,627.0
Total Assets 0 0
Contingent Liabilities 24,157.00 25,629.00

Income Statement (₹ in Crores)

Year 2023 2022
INCOME:
Sales Turnover 5,39,238.00 7,92,756.00
Excise Duty 72,314.00 92,794.00
Net Sales 4,66,924.00 6,99,962.00
Other Income 38,229.00 18,099.00
Stock Adjustments 9,064.00 21,457.00

PGDM Question Paper

 Total Income 5,14,217.00 7,39,518.00
EXPENDITURE:
Raw Materials 3,01,765.00 4,96,369.00
Power & Fuel Cost 13,214.00 17,902.00
Employee Cost 14,817.00 18,775.00
Other Manufacturing Expenses 7,687.00 12,174.00
Selling and Administration Expenses 56,154.00 63,557.00
Miscellaneous Expenses 18,347.00 2,947.00
Less: Pre-operative Expenses Capitalised 989 729
Total Expenditure 4,10,995.00 6,10,995.00
Operating Profit 1,03,222.00 1,28,523.00
Interest 21,189.00 14,584.00
Gross Profit 82,033.00 1,13,939.00
Depreciation 26,572.00 29,797.00
Profit Before Tax 55,461.00 84,142.00
Tax 2,205.00 3,161.00
Deferred Tax -483 13,136.00
Net Profit 53,739.00 67,845.00
Minority Interest (after tax) 4,611.00 7,140.00
Net Profit after Minority Interest & P/L
Asso.Co. 49,128.00 60,705.00
Extraordinary Items 5,366.79 2,177.86
Adjusted Net Profit 43,761.21 58,527.14
Dividend Per Share (Rs) 7 8
Book Value (Unit Curr.) 1,024.56 1,152.23

Industry ratios – 2023

Industry 2023
Key Ratios
Debt-Equity Ratio 1.65
Liabilities to Equity 1.91
Current Ratio 0.64
Quick ratio 0.46
Turnover ratios
Assets 1.35
Inventory 12.91
Receivables 10.67
Debtors 21.79
Interest Cover Ratio 1.39
Profit Margin (%) 9.61
ROA (%) 5.11
ROE (%) 3.18

PGDM Question Paper