INDEX

SR.NO CONTENT PAGE

NO
1 CHAPTER NO 1
(THEORETICAL BACKGROUND)
 Introduction
 Meaning & Definition
 Functions of Management A/c
 Objectives
 Characteristics
 Advantages
 Disadvantages
 Scope
 Fund Flow
 Definition & Meaning
 Difference between Current Liabilities
& Current Assets
 Fund Flow Chart
 Limitations of Fund Flow

2 CHAPTER NO 2
 Corporate Profile
 Company Profile
 Data Analysis & Interpretation

3 CHAPTER NO 3
 Findings
 Suggestions
 Conclusion
 Biblography
 CHAPTER NO 1
Introduction
Management accounting also is known as managerial accounting and can be defined as a process of
providing financial information. And resources to the managers in decision making. Management
accounting is only used by the internal team of the organization. This is the only thing that makes it
different from financial accounting. In this process, financial information and reports such as.
Invoice and financial balance statements are shared by the finance administration with the
management team of the company. The objective of management accounting Is to use this
statistical data and take better and more accurate decisions. On controlling the enterprise, business
activities, and development. Financial accounting is the recording and presentation of information
for the benefit of the various stakeholders of an organization. Management accounting, on the
other hand, is the presentation of financial data and business activities. Especially for the internal
management of the organization. In this article, we will learn what is management accounting and
its functions.
One of the definitions of Management accounting says that it is the application of professional skills
and knowledge. In the preparation of financial and accounting information in a manner assisting the
internal management in the formulation of policies. Including planning, and control of the
operations of the firm . The basic function of management accounting is to help the management
make decisions. There is no fixed structure or format for it. Financial accounting, costing, business
analysis, economics, etc. are some tools and techniques of management accounting. The only need
for management accounting is that the data should serve its purpose, helping management take
important business decisions.
Management of every business enterprise aim at ensuring maximum profitability with financial
stability. These aims and objectives are sought to be achieved through the function of planning,
organizing, director, coordinating, motivating, actualting and controlling. For performance of all
these functions in efficient manner management needs proper and timely information about
different segment of the business. Management without proper managerial information may lead
to serve problems. Financial accounting and cost accounting provide some information useful for
managerial decision making.
Management accounting is a branch of accounting that focuses on providing financial information
and analysis to aid managerial decision-making within organizations. Unlike financial accounting,
which primarily deals with reporting past financial performance to external stakeholders,
management accounting is geared towards internal users such as managers and executives. Its
objectives include planning, controlling, decision-making, and performance evaluation.
Management accountants utilize various tools and techniques such as cost accounting, budgeting,
variance analysis, and performance measurement to support strategic and operational decisions,
improve efficiency, and enhance overall organizational performance. eManagement accounting is a
specialized branch of accounting dedicated to providing internal stakeholders, such as managers
and executives, with the financial information and analysis needed to make informed decisions.
Unlike financial accounting, which primarily focuses on historical financial reporting for external
parties, management accounting emphasizes forward-looking perspectives to support planning,
controlling, decision-making, and performance evaluation within organizations. Management
accountants collect, analyze, and interpret both financial and non-financial data to assist in various
functions, including cost management, budgeting, strategic planning, performance measurement,
and risk management.
Meaning :
The term “management accounting” refers to the specialized field of accounting that focuses on
providing financial information and analysis to aid managerial decision-making within organizations.
It involves collecting, analyzing, and interpreting both financial and non-financial data to support
functions such as planning, controlling, decision-making, and performance evaluation. Unlike
financial accounting, which primarily deals with reporting historical financial performance to
external stakeholders, management accounting is geared towards internal users, such as managers
and executives, to help them make informed decisions to improve efficiency and enhance overall
organizational performance.

Definition:
According to Anglo :
-American Council of Productivity, Management Account is the presentation of accounting
information in such a way as to assist management in the creation of policy in today’s operation of
undertakings.”
According to Robert Anthony,” :
Management Accounting is concerned with accounting information that is useful to management.”
Professor J Batty defines:
“It is the term used to describe the accounting methods, systems, and techniques, which, coupled
with special knowledge and ability, assist management in its task of maximizing profits or
minimizing losses.

Functions of management accounting :

Management accounting serves several key functions within organizations. Here are some of the
primary functions:
1. **Planning**: Management accountants assist in the formulation of strategic plans,
operational budgets, and financial forecasts. They provide financial analysis and projections
to support decision-making related to resource allocation, goal setting, and performance
targets.
2. *Controlling**: Management accountants develop systems and processes to monitor and
control organizational activities. They compare actual performance against budgeted
 targets, identify variances, and take corrective actions to ensure that the organization’s
objectives are being met eefficitarge
3. **Decision-making**: Management accountants provide financial analysis and insights to
support decision-making at all levels of the organization. This includes evaluating
investment opportunities, pricing strategies, product profitability, cost reduction initiatives,
and other strategic decisions.
4. **Performance Evaluation**: Management accountants design and implement
performance measurement systems to assess the effectiveness and efficiency of
organizational activities. They develop key performance indicators (KPIs) and performance
metrics to evaluate the performance of departments, products, projects, and individuals.
5. **Cost Management**: Management accountants focus on managing and controlling costs
within the organization. This includes analyzing cost behavior, allocating costs to products or
services, identifying cost reduction opportunities, and optimizing cost structures to improve
profitability.
6. **Budgeting**: Management accountants play a central role in the budgeting process,
working with managers to develop budgets that align with organizational goals and
objectives. They monitor actual performance against budgeted targets, analyze variances,
and assist in adjusting plans as necessary.
7. **Strategic Planning**: Management accountants contribute to strategic planning by
providing financial analysis and insights into market trends, competitive dynamics, and
other factors influencing the organization’s long-term success. They help identify
opportunities for growth, investment, and innovation.
8. **Risk Management**: Management accountants identify, assess, and manage financial
risks within the organization. This includes evaluating market risks, credit risks, operational
risks, and regulatory compliance risks. They develop risk management strategies and
recommend measures to mitigate risks effectively.
Overall, management accounting serves as a critical function within organizations, providing
financial information, analysis, and support to help managers make informed decisions, achieve
organizational objectives, and enhance overall performance.
The objectives of management accounting :

1. **Decision Support**: Management accounting aims to provide timely and relevant

financial and non-financial information to support managerial decision-making processes.
This includes analyzing data, preparing forecasts, and evaluating alternative courses of
action to help managers make informed decisions that align with organizational goals.
2. **Planning and Forecasting**: Management accounting assists in the planning and
forecasting processes by developing budgets, financial projections, and operational plans.
These tools help managers set targets, allocate resources efficiently, and anticipate future
challenges and opportunities.
3. **Performance Evaluation**: Management accounting establishes performance
measurement systems to assess the efficiency and effectiveness of organizational activities.
 By comparing actual performance against predetermined benchmarks, managers can
identify areas for improvement and take corrective actions as necessary.
4. **Cost Management**: Management accounting focuses on managing and controlling costs
within the organization. This involves identifying and analyzing costs, allocating costs to
products or services, and implementing cost reduction initiatives to improve profitability
and competitiveness.
5. **Strategic Management**: Management accounting contributes to strategic planning by
providing financial analysis and insights into market trends, competitive dynamics, and
other factors influencing the organization’s long-term success. This includes evaluating
investment opportunities, assessing risk, and identifying strategic priorities.
6. **Risk Management**: Management accounting identifies, assesses, and manages financial
risks within the organization. By evaluating market risks, credit risks, operational risks, and
regulatory compliance risks, management accountants help mitigate potential threats and
safeguard the organization’s financial health.
7. **Communication and Collaboration**: Management accounting serves as a bridge
between different functional areas within the organization, facilitating communication and
collaboration among managers and executives. By providing clear and concise financial
information, management accountants help align organizational efforts and promote a
shared understanding of goals and objectives.

Overall, the objectives of management accounting are to enhance organizational performance,

optimize resource allocation, mitigate risks, and support strategic decision-making processes. By
fulfilling these objectives, management accountants contribute to the overall success and
sustainability of the organization.

Characteristics of management accounting:

The characteristics of management accounting include:

1. **Internal Focus**: Management accounting is primarily concerned with providing

information and analysis for internal decision-making purposes within the organization. It
focuses on meeting the needs of managers and executives rather than external
stakeholders.
2. **Forward-looking Perspective**: Unlike financial accounting, which deals with historical
data, management accounting takes a forward-looking approach. It involves forecasting,
planning, and analyzing future scenarios to support strategic decision-making.
3. **Flexibility**: Management accounting systems and techniques are adaptable to the
specific needs and objectives of the organization. They can be customized to address
different managerial challenges, industries, and organizational structures.
4. **Decision Orientation**: The primary purpose of management accounting is to support
decision-making processes at all levels of the organization. It provides managers with
 relevant information, analysis, and insights to help them make informed decisions that drive
performance and achieve organizational goals.
5. **Use of Both Financial and Non-Financial Information**: While financial data is essential,
management accounting also incorporates non-financial information such as customer
satisfaction, employee productivity, and market trends. This holistic approach provides a
more comprehensive understanding of organizational performance.
6. **Cost Emphasis**: Cost management is a significant focus of management accounting. It
involves analyzing costs, identifying cost drivers, and implementing cost reduction strategies
to improve efficiency and profitability.
7. **Integration with Other Management Functions**: Management accounting is closely
integrated with other management functions such as strategic planning, budgeting,
performance management, and risk management. It provides financial insights and analysis
to support these functions and ensure alignment with organizational goals.
8. Continuous Improvement**: Management accounting systems and techniques are
continually evolving to meet the changing needs of organizations and the business
environment. Continuous improvement efforts focus on enhancing the relevance, accuracy,
and timeliness of information provided to manager’s.
9. **Analytical and Interpretative**: Management accounting involves analyzing data,
interpreting results, and providing insights and recommendations to support decision-
making. Management accountants use various analytical tools and techniques to evaluate
performance, identify trends, and assess the impact of different strategies.
10. **Confidentiality and Integrity**: Management accountants handle sensitive financial
information and must adhere to ethical standards and principles of confidentiality. They
ensure the integrity and reliability of data used for decision-making purposes.
Overall, these characteristics define management accounting as a dynamic and essential function
within organizations, providing managers with the information and analysis needed to drive
performance, make informed decisions, and achieve strategic objectives.

Advantages of management accounting:

The advantages of management accounting include:

1. **Better Decision Making**: Management accounting provides timely and relevant

information to managers, enabling them to make informed decisions based on accurate
data and analysis. This leads to more effective strategic planning, resource allocation, and
performance management.
2. **Cost Reduction**: By analyzing costs and identifying inefficiencies, management
accounting helps organizations reduce costs and improve cost-effectiveness. This can lead to
higher profitability and competitive advantage in the marketplace.
 3. **Improved Performance**: Management accounting allows organizations to monitor and
evaluate performance against established goals and targets. By identifying areas of strength
and weakness, management can take corrective actions to improve overall performance and
productivity.
4. **Strategic Planning**: Management accounting provides financial insights and analysis to
support strategic planning and decision-making. This includes assessing market trends,
evaluating investment opportunities, and identifying potential risks and opportunities for
the organization.
5. **Resource Optimization**: With better information and analysis provided by management
accounting, organizations can optimize the allocation of resources such as capital, labor, and
materials. This ensures that resources are used efficiently to maximize value and minimize
waste.
6. **Enhanced Control**: Management accounting systems help organizations establish
controls and procedures to monitor and manage business activities effectively. This
improves accountability, reduces the risk of fraud and errors, and ensures compliance with
regulatory requirements.
7. **Improved Communication**: Management accounting facilitates communication and
collaboration among different departments and levels of management within the
organization. By providing clear and concise financial information, management accountants
help align organizational efforts and promote a shared understanding of goals and
objectives.
8. **Performance Measurement**: Management accounting establishes performance
measurement systems and key performance indicators (KPIs) to evaluate the effectiveness
of organizational activities. This allows managers to track progress, identify areas for
improvement, and make data-driven decisions to drive performance.
9. **Adaptability**: Management accounting systems and techniques can be tailored to meet
the specific needs and objectives of different organizations and industries. This flexibility
allows organizations to adapt to changing market conditions, regulations, and business
environments.
10. **Competitive Advantage**: Overall, the advantages of management accounting enable
organizations to gain a competitive advantage by making better decisions, reducing costs,
improving performance, and positioning themselves for long-term success in the
marketplace.

Disadvantages of management accounting:

While management accounting offers numerous benefits, it also has its disadvantages:

1. **Costly Implementation**: Implementing management accounting systems and processes

can be expensive, requiring investments in technology, training, and personnel. Small
 businesses may find it challenging to justify the initial costs, particularly if they lack the
resources or expertise to effectively implement and maintain such systems.
2. **Complexity**: Management accounting systems can be complex and sophisticated,
especially in large organizations with diverse operations and information needs. Managing
and interpreting large volumes of financial and non-financial data can be challenging,
requiring specialized skills and expertise.
3. **Subjectivity**: Management accounting involves subjective judgments and estimates,
particularly when forecasting future outcomes or evaluating intangible assets such as
goodwill. This subjectivity can introduce bias and uncertainty into decision-making
processes, potentially leading to suboptimal outcomes.
4. **Time-consuming**: Gathering, analyzing, and interpreting data for management
accounting purposes can be time-consuming, particularly in organizations with
decentralized operations or multiple business units. This can divert managerial attention
away from core business activities and strategic priorities.
5. **Resistance to Change**: Implementing management accounting systems and processes
may face resistance from employees who are accustomed to existing practices or perceive
the changes as a threat to their autonomy or job security. Overcoming resistance to change
requires effective communication, training, and change management strategies.
6. **Focus on Short-term Results**: Management accounting systems may incentivize
managers to prioritize short-term results over long-term strategic objectives, particularly if
performance metrics are tied to financial targets or bonuses. This short-term focus can
undermine long-term sustainability and value creation for the organization.
7. **Overemphasis on Financial Metrics**: Management accounting traditionally focuses on
financial metrics such as revenue, costs, and profitability, which may not capture the full
range of factors influencing organizational performance, such as customer satisfaction,
employee engagement, or environmental impact. This narrow focus can lead to a
disconnect between financial performance and broader organizational goals.
8. **Data Quality and Reliability**: Management accounting relies on accurate and reliable
data to generate meaningful insights and analysis. Poor data quality, incomplete
information, or data entry errors can undermine the credibility and usefulness of
management accounting reports and analysis.
9. **Over-reliance on Quantitative Analysis**: Management accounting tends to emphasize
quantitative analysis and financial metrics, sometimes at the expense of qualitative factors
or contextual understanding. This can lead to oversimplified or one-dimensional decision-
making processes that fail to capture the complexities of real-world business situations.
10. **Potential for Misuse**: Management accounting information can be misused or
manipulated for personal gain or to manipulate perceptions of organizational performance.
This highlights the importance of ethical behavior, transparency, and internal controls to
ensure the integrity and reliability of management accounting practices.

Scope of management accounting :

The scope of management accounting encompasses various aspects of organizational management
and decision-making. Here are some key components of its scope:

1. **Financial Analysis**: Management accounting involves analyzing financial data to assess

the financial health and performance of the organization. This includes evaluating
profitability, liquidity, solvency, and efficiency ratios to provide insights into the
organization’s financial position.
2. **Cost Accounting**: Management accounting includes cost accounting techniques to
analyze and allocate costs to products, services, departments, or activities. This helps in
understanding cost behavior, identifying cost drivers, and managing costs effectively to
improve profitability.
3. **Budgeting and Forecasting**: Management accounting encompasses the preparation of
budgets and financial forecasts to guide planning and resource allocation decisions. This
involves estimating future revenues, expenses, and cash flows based on historical data,
market trends, and business projections.
4. **Performance Measurement**: Management accounting establishes performance
measurement systems and key performance indicators (KPIs) to evaluate the effectiveness
and efficiency of organizational activities. This allows managers to monitor performance,
track progress towards goals, and identify areas for improvement.
5. **Strategic Planning**: Management accounting supports strategic planning by providing
financial analysis and insights into market trends, competitive dynamics, and growth
opportunities. This includes evaluating investment decisions, assessing risk, and identifying
strategic priorities to achieve long-term objectives.
6. **Decision Support**: Management accounting provides information and analysis to
support decision-making processes at all levels of the organization. This includes evaluating
alternative courses of action, assessing the financial implications of decisions, and
recommending actions to achieve desired outcomes.
7. **Risk Management**: Management accounting identifies, assesses, and manages financial
risks within the organization. This involves evaluating market risks, credit risks, operational
risks, and regulatory compliance risks to minimize potential threats and maximize
opportunities.
8. **Internal Control**: Management accounting helps establish internal control systems and
procedures to safeguard assets, prevent fraud, and ensure compliance with laws and
regulations. This includes monitoring and evaluating internal controls to identify weaknesses
and implement corrective actions as needed.
9. **Performance Evaluation**: Management accounting evaluates the performance of
departments, products, projects, and individuals based on predefined metrics and targets.
This allows managers to assess performance, identify areas of strength and weakness, and
make data-driven decisions to improve results.
10. **Communication and Collaboration**: Management accounting facilitates communication
and collaboration among different functional areas and levels of management within the
 organization. This includes providing clear and concise financial information, collaborating
on strategic initiatives, and promoting a shared understanding of goals and objectives.

Overall, the scope of management accounting is broad and multidimensional, encompassing

various aspects of financial management, planning, decision-making, and control to support
organizational success and sustainability.

Fund flow :
FUNDS FLOW STATEMENT every concern, the funds breeze in anatomy altered sources and
analogously funds are invested in assorted sources of investment. It is connected process. The
abstraction and ascendancy of this funds-flow action (i.e., the uses and sources of funds) is the
basic cold of banking administration to appraise the acumen and the solvency of the enterprise
The funds-flow-statement is a address on banking operations changes, breeze or movements
during the period. It is a annual which shows the sources an appliance of funds or it shows how the
activities of a business are financed in a chapped period. In added words, such a annual shows how
the banking assets accept been acclimated during a accurate aeon of time. It is, thus, a absolute
annual assuming sources and appliance of funds amid the two dates advised abnormally to analyse
the changes in the banking altitude of an enterprise. In the words of Foulke, it is- enterprise.
“A annual of Sources and Appliance of Funds is a abstruse accessory advised to analyse the changes
in the banking action of a business enterprises amid two dates.”
Funds Breeze Annual is not an assets annual. Assets annual shows the items of assets and bulk of a
accurate period, but the Funds breeze annual is an operating annual as it summaries the banking
activities for a aeon of time. It covers all movements that absorb an absolute barter of assets.
Various titles are acclimated for this annual such as ‘Statement of sources and Appliance of Funds’,
‘Summary of Banking operations,’ ‘Changes in Banking Position’, ‘Fund accustomed and Disbursed’,
‘Funds Generated and Expended’, Changes in Alive Capital”, “Statement of Fund’ etc. Title of Funds
Breeze Annual has been adapted from time to time. Really it is actual difficult to acquisition a
abbreviate time for such annual which carries abundant to the readers apropos its capacity an
functions.
The basal banking statements i.e., the Antithesis Area and Profit & Loss A/c or Income Account of
business reveals the net aftereffect of assorted affairs on operational and banking position of the
company. The antithesis area gives a arbitrary of the assets & liabilities of an adventure at a
accurate point of time.
There are abounding affairs that yield abode in an adventure and which do not accomplish Profit &
Loss A/c. Thus addition account has to be able to appearance the change in Assets & Liabilities from
the end of one acon of time to the end of addition acon of time. The account is alleged a account of
changes in banking position or a Funds Flow Statement.
The Funds Flow Account is a account which apparent the movement of funds and is a address of
banking operations of business undertaking. In simple words it is a account of antecedent and apply
it .

MEANING & CONCEPT OF FLOW OF FUNDS:

The appellation breeze agency movement & includes both ‘inflow’ & ‘outflow’. The appellation
breeze of funds agency alteration of bread-and-butter ethics from one asset of disinterestedness to
another. Breeze of funds is said to accept taken abode if any transaction makes changes in bulk of
funds accessible afore accident of transactions. If the aftereffect of transaction after-effects in
access of funds. It is alleged a “source of funds” and it is after-effects in abatement of funds, it is
accepted as an appliance of funds.

RULE-
The breeze of funds occurs if a transaction changes on one duke a non-current A/c and on the
added a accepted A/c and Vice-versa. According to alive basic abstraction of funds the appellation
“Flow o Funds” acknowledgment to movement of funds in alive capital.
If any transaction after-effects in access in alive capital. It is said to be a “source” or “inflow of
funds” and if it after-effects in abatement of alive capital, it is said to be “application” or “out
breeze of funds”.

CURRENT ASSETS-
Current Assets are those assets, which in the accustomed advance of business can be or will be
adapted into banknote aural a abbreviate aeon of commonly one accounting year.

CURRENT LIABILITIES-
Current liabilities are those liabilities which are advised to be paid in accustomed advance of
business with in abbreviate aeon of commonly one accounting year out of the accepted assets or
the a

Definition of fund flow:

FOUIKE DEFINES
“A statement of sources & application of funds is technical devices designed to analyses the
changes in the financial condition of business enterprise between two date
ANTHONY DEFINES
“The Funds Flow Statement describes the sources from which additional funds were derived and
the use to which these sources were put.
Differences between current liabilities & current assets
 CURRENT LIABILITIES CURRENT ASSETS

1. Bills Payable 1. Cash in Hand

2. Sundry Creditors 2. Cash at Bank

3. Accrued or O's Expenses 3. Bills Receivable

4. Dividends Payable 4. Sundry Debtors or A/c's receivable

5. Bank Overdraft 5. Short term loans & advances

6. Short term loans, 6. Short term investment

advances & deposits
7. Inventories or stock
7. Provision for taxation.
8. Prepaid Expenses
8. Proposed Dividend
9. Accrued incomes.

LIMITATIONS OF FUNDS FLOW STATEMENT

The funds flow statement has a number of uses, however, it has certain limitations also,
which are listed below.

1. It should be remembered that a funds flow statement is not a substitute of an income

statement or a balance sheet. It provides only some additions information as regards
charges in working capital.

2. Cannot reveal continuous changes.

3. It is not an original statement but simply is arrangement of data given in financial
statements.
4. It is essentially historic in nature and projected funds flow statement cannot be
prepared with much accuracy.

5. Change in cash is more important & relevant for financial management than the working
capital,
 CHAPTER NO 2

CORPORATE PROFILE:

Hero MotoCorp Ltd. (Formerly Hero Honda Motors Ltd.) is the world’s bigger architect of
two wheelers, based in India.

In 2001, the aggregation accomplished the coveted position of getting the bigger bike
accomplishment aggregation in India and also, the ‘World No.1’ bike aggregation in
agreement of assemblage aggregate sales in a agenda year. Hero MotoCorp Ltd. Continues
to advance this position till date.

Vision

The adventure of Hero Honda began with a simple eyes the eyes of a adaptable and an
empowered India, powered by its two wheelers. Hero MotoCorp Ltd., company’s new
identity, reflects its charge appear accoutrement apple chic advancement solutions with
renewed focus on accretion company’s cast in the all-around arena.

Mission

Hero MotoCorp’s mission is to become a all-around action accomplishing its customers’

needs and aspirations for mobility, ambience benchmarks in technology, administration and
superior so that it converts its barter into its cast advocates. The aggregation will
accommodate an agreeable ambiance for its humans to accomplish to their accurate
potential. It will abide its focus on amount conception and constant relationships with its
partners

Strategy

Hero MotoCorp’s key strategies are to body a able-bodied artefact portfolio beyond
categories, analyze advance opportunities globally, continuously advance its operational
efficiency, aggressively aggrandize its adeptness to customers, abide to advance in cast
architecture activities and ensure chump and actor delight.

Manufacturing

Hero MotoCorp two wheelers are bogus beyond 3 globally benchmarked accomplishment
facilities. Two of these are based at Gurgaon and Dharuhera which are amid in the
accompaniment of Haryana in arctic India. The third and the latest accomplishment bulb is
based at Haridwar, in the acropolis accompaniment of Uttrakhand.
Technology
In the 1980’s Hero Honda pioneered the addition of fuel-efficient, ambiance affable four-
stroke motorcycles in the country. Today, Hero Honda continues to be technology pioneer.
It became the aboriginal aggregation to barrage the Ammunition Injection (FI) technology in
Indian motorcycles, with the barrage of the Glamour Fl in June 2006.

Distribution
The Company’s advance in the two wheeler bazaar in India is the aftereffect of an built-in
adeptness to access adeptness in new geographies and advance markets. Hero MotoCorp’s
all-encompassing sales and account adjustment now spans over to 6000 chump blow points.
These comprise a mix of accustomed dealerships, account & additional locations outlets and
dealer- appointed outlets beyond the country

Brand
The new Hero is ascent and is assertive to flash on the all-around arena. Company’s new
character “Hero MotoCorp Ltd.” Is absolutely cogitating of its eyes to strengthen focus on
advancement and technology and creating all- around footprint. Architecture and
announcement new cast character will be axial to all its initiatives, utilizing every befalling
and leveraging its able attendance beyond sports, brawl and below activation

HERO’S MANDATE
Hero is a apple baton because of its accomplished manpower, accurate management, all-
encompassing banker network, able accumulation

Company profile:

Hero MotoCorp Limited is an Indian multinational motorcycle and scooter manufacturer

headquartered in Delhi. It is one of the world’s largest two-wheeler manufacturer and has a
market share of about 46% in the Indian two-wheeler industry.[3][4] As of 27 May 2021, the
market capitalization of the company was ₹59,600 crore (equivalent to ₹700 billion or
US$8.8 billion in 2023).

Hero MotoCorp:

 Formerly- Hero Honda

 Company type - Public
 Industry- Automotive
 Founded- 19 January 1984; 40 years ago
 Founder- Brijmohan Lall Munjal
  Headquarters- New Delhi, India
 Key people- Pawan Munjal , Executive Chairman & Whole-time Director
 Products- Motorcycles, Scooters
 Production output- Increase 7,587,130 units (2018)
 Revenue- Increase ₹34,727.39 crore (US$4.3 billion) (2023)[2]
 Operating income- Increase ₹3,863.62 crore (US$480 million) (2023)[2]
 Net income- Increase ₹2,799.90 crore (US$350 million) (2023)[2]
 Total assets- Increase ₹23,917.03 crore (US$3.0 billion) (2023)[2]
 Total equity- Increase ₹16,780.63 crore (US$2.1 billion) (2023)[2]
 Owner- Munjal family: (40%), Government of India (through public sector banks):
(15%), Tata asset management (0.8%),more.
 Number of employees- 8,599 (2020)
 Parent- Hero Motors Company
 Subsidiaries- Vida EV

Awards and recognition

The 2006 Forbes list of the 200 World’s Most Respected Companies had Hero Honda Motors
ranked at No. 108.
The Brand Trust Report published by Trust Research Advisory has ranked Hero Honda in the 7 th
position among the most trusted brands in India.
 CHAPTER NO 3

Data analysis of fund flow statement

Compositions of current Assets (All

The amounts are in lakhs)

Particulars 2017-16 2016-15 2015-14 2014-13 2013-12 Avg.

669.55 588.64
Inventory 436.4 524.93 675.57 636.76

Sundry 108.39 130.59 272.31 665.00 920.58 419.37

Debtors

Cash and 1907.21 71.52 56.10 181.04 117.50 466.67

Bank
Loans & 405.76 728.66 926.99 1401.95 1203.54 933.38
Advances

Other 24.82 48.87 20.72 0.00 0.00 18.88

current
Assets
Total 2882.58 1504.57 1951.69 2884.75 2241.62

3500

3000

2500

2000

1500

1000

500

0
Inventory Sundry Debtors Cash and Bank Loan and Other Curresnt Total
Advances Assets

2017-16 2016-15 2015-14 2014-13 2013-12 Avg.

 INTERPRETATION:-

The income statement is also called as income statement, it is considered to be

the most useful of all financial statements. It prepared by a business concern in

order to know the profit earned and loss sustained during a specified

period. It explains what has happened to a business as a result of operations

between two balance sheet dates. For this purpose it matches the revenues

and cost incurred in the process of earning revenues and shows the net profit

earned or loss suffered during a particular period.

The nature of Income which is a focus of the income statement can be

well understood if business is taken as an organization that uses “Input” to

produce “Output”. The output of the goods and services that the business

provides to its customers. The values of these outputs are the goods and

services that the business provides to its customers. The values of these

outputs art the amounts paid by the customers for them. These amounts are

called “revenues” in the accounting. The inputs are the economic resources

used by the business in providing these goods and services. These are termed

“expenses” in accounting.
what has happened to a business as a result of operations between two balance sheet

dates. For this purpose it matches the revenues and cost incurred in the process of earning

revenues and shows the net profit earned or loss suffered during a particular period.

The nature of Income which is a focus of the income statement can be well

understood if business is taken as an organization that uses “Input” to produce

“Output”. The output of the goods and services that the business provides to its

customers. The values of these outputs are the goods and services that the business

provides to its customers. The values of these outputs art the amounts paid by the

customers for them. These amounts are called “revenues” in the accounting. The

inputs are the economic resources used by the business in providing these goods

and services. These are termed “expenses” in accounting.

STATEMENT OF CHANGES IN WORKING CAPITAL

Rs in lakhs

Working capital turnover ratio 2017

Working capital turnover ratio 2017 2016
Total current Assets
Inventories 636.76 669.55
Sundry Debtors 665.00 920.58
Cash and Bank Balances 181.04 117.50
Other Current Assets 0.00 0.00
Loans and Advances 1401.95 1203.54

Total 2884.75 2911.17

Total Current Liabilities

Current Liabilities 2893.39 2903.12

Provisions 1439.86 1594.31

Total 4333.25 4497.43

Net working capital -1448.50 -1586.26

Increase\decrease in net working
capital -137.76
 10000

8000

6000

4000

2000

Increase/Decrease in Net working Capital

Cash and Bank balance

Total Current Liabilities

Net working capital

Total Current Assets

Other Current Assets

Loans and Advances

Current Liabilities
Working Capital

Sundry Debtors
Inventories

Provisions
Total

Total
-2000

-4000

2017 2016

Interpretation:

The networking capital of Hero MotoCorp Ltd has been decreased to

137.76 Cr the financial position i.e. the performance of Hero MotoCorp Ltd has
decreased and the current assets defects its current liability.

Note: financial position may depend on long term liabilities and also fixes assets.
 STATEMENT OF SOURCES AND APPILICATION OF FUNDS FOR THE PERIOD 2017-
16

Rs in lakhs

Source Rs. Application Rs.

Issue of share capital 39.94 Funds lost in operation 0.00
Repayment of long term loan
Raising of long term loans 0.00 0.00
loans
Sale of non-current (fixed) Purchase of long term
446.38 -1552.10
assets investments
Non-trading receipts 0.00

Sale of investment 1203.54

Decrease in working capital -137.76

1552.10 1552.10

TABLE-2

100%

90%

80%

70%

60%
Rs.2
50%
Application
40% Rs.

30%

20%

10%

0%
1 2 3 4 5 6 7
Analysis:

From the table it is observed that the working capital of company shows decreased
trend. The current Asset of the company has decreased Rs 137.76 in 2014-2015. But
the item cash balance showing increasing trend. The current liabilities of company are
decreased in 2014-2015.In the net working capital of company stood -137.76 It is
decreased in 2014-2015. The decreasing net working capital.

Regarding the application of funds 39.97 % used for investment in fixed

assets and funds used for working capital purpose. Constitute 28.04 % respectively
 INTERPRETATION

It is concluded that during the period 2014-2015 Increasing gross block

and net Decreasing in working capital.

STATEMENT OF CHANGES IN WORKING CAPITAL

Rs in lakhs

Working capital turnover ratio 2016

Working capital turnover ratio 2015 2016
Total current Assets
Inventories 675.57 636.76
Sundry Debtors 272.31 665.00
Cash and Bank Balances 56.10 181.04
Other Current Assets 20.72 0.00
Loans and Advances 926.99 1401.95

Total 1951.69 2884.75

Total Current Liabilities

Current Liabilities 3520.66 2893.39

Provisions 1090.07 1439.86

Total 4610.73 4333.25

Net working capital -2659.04 -1448.50

Increase\decrease in net working
capital -1210.54
 100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

Total Current Liabilities

Net working capital

Total current Assets

cash and bank balances

Loans and Advances

Current Liabilities
Sundry Debtors

Other Current Assets

Total

Provisions

Total
Inventories

Increase\decrease in net working capital

2015 2016

Interpretation:

The networking capital of Hero MotoCorp Ltd has been decreased to

1210.54 Cr the financial position i.e. the performance of Hero MotoCorp Ltd has
increased and the current assets defects its current liability.
STATEMENT OF CHANGES IN WORKING CAPITAL

Rs in lakhs

Working capital turnover ratio 2015

Working capital turnover ratio 2014 2015
Total current Assets
Inventories 524.93 675.57
Sundry Debtors 130.59 272.31
Cash and Bank Balances 71.52 56.10
Other Current Assets 23.77 20.72
Loans and Advances 783.48 926.99

Total 1510.52 1951.69

Total Current Liabilities

Current Liabilities 5063.68 3520.66

Provisions 1081.07 1090.07

Total 6144.75 4610.73

Net working capital -4640.21 -2659.04

Increase\decrease in net working
capital -1981.17
 15000

10000

5000

Net working capital

Total current Assets

Cash and Bank Balances

Loans and Advances

Total Current Liabilities

Total

Total
Sundry Debtors

Other Current Assets

Current Liabilities

Provisions
Inventories

Increase\decrease in net working

-5000

-10000

2014 2015

Interpretation:

The networking capital of Hero MotoCorp Ltd has been decreased to

2659.04 Cr the financial position i.e. the performance of Hero MotoCorp Ltd has
increased and the current assets defects its current liability.
 STATEMENT OF SOURCES AND APPILICATION OF FUNDS FOR THE PERIOD 2014-
2013

Rs in lakhs

Source Rs. Application Rs.

Issue of share capital 39.94 Funds lost in operation 0.00
Repayment of long term loan
Raising of long term loans 32.71 4987.36
loans
Purchase of long term
Sale of non-current (fixed) assets 456.37 -2507.91
investments
Non-trading receipts 0.00
Sale of investment 3964.26
Decrease in working capital -1981.17
2479.45 2479.45

TABLE-2

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%
1 2 3 4 5 6

Rs. Application Rs

Analysis:
 From the table it is observed that the working capital of company shows decreased
trend. The current Asset of the company has decreased Rs 2659.04 in 2012-13 is
1951.69. But the item cash balance showing increasing trend. The current liabilities of
company are decreased in 2012-13.In the net working capital of company stood -
1981.17 It is decreased in 2012-13. The decreasing net working capital .

Regarding the application of funds 41.21 % used for investment in fixed

assets and funds used for working capital purpose. Constitute 34.59 % respectively

INTERPRETATION

It is concluded that during the period 2012-13 Increasing gross block and
net Decreasing in working capital
 CHAPTER NO 3

FINDINGS

1. The Hero MotoCorp Ltd net working capital is satisfactory between the

years 2017-16 since it shows decreasing trend ; but after that it is in

declining position.

2. The current assects of Hero MotoCorp Ltd is satisfactory during the period

of study 2013-12 to 2017-16 It is increased but after that it is declining.

3. Fixed assets of Hero MotoCorp Ltd increased. The company has to

maintain this.

4. Inventory turnover of Hero MotoCorp Ltd is also increased gradually,

without any fit falls up to 2013-12. But in the year 2014-13 it is declined, and

again it has increased in the year 2013-14. Good inventory management is

good sign for efficient management

5. Total Assets turnover of Hero MotoCorp Ltd is not satisfactory because it is

always below one, except in the year 2013-14.

6. Return on investment is not satisfactory. This indicates that the

company’s funds are not being utilized in a better way.

 CONCLUSION

The Hero MotoCorp Ltd net working capital is satisfactory between the years
since it shows increasing trend; but after that it is in declining position Profit Margin
of Hero MotoCorp Ltd is decreasing and showing negative profit because there is
increase in the price of copper The Hero MotoCorp Ltd Net Working Capital Ratio is
satisfactory.
The Operating Ratio of Hero MotoCorp Ltd isn’t satisfactory. Due to increase in cost
of production, this ratio is decreasing. So the has to reduce its office administration
expenses Improve position funds should be utilized properly. Better Awareness to
increase the sales is suggested. Cost cut down mechanics can be employed. Better
production technique can be employed.
 SUGGESTIONS

 Net working capital is very low; it is suggested to maintain

sufficient net working capital.
 Effective inventory management is needed in the company
 The firm should increase investment in current assets to
create sufficient securities for the current liabilities
 For the improving the financial performance of the company
the following suggestions are made.
 In order to reduce the outside borrowings in the company has to
acquire. The capital from equity sources. Keeping in view the
debt equity the proportion as normal.
 The liquidity of the company should be improved by maintaining
the optimum current assets and liquid assets according to
standard norms.
 The quantum of the sales generated should be improved
impressively in order to attain higher return on investment.
 To improve the financial health of the company and
maximizing the time between the source mobilization and
utilization the management must introduce the new cost
saving techniques.
BIBLIOGRAPHY