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“RESEARCH REPORT”

Prepared By
Vijaya Krishna
“Financial Performance Analysis of H.D.F.C Bank”

Research Project Submitted in Partial Fulfillment of

the Requirements for the Degree of

MASTER OF COMMERCE
By
Vijaya Krishna
To the
DEPARTMENT OF COMMERCE
ASHA MAHAVIDYALAYA, BABATPUR
VARANASI

Submitted by: - Under Guidance:-

Vijaya Krishna Dr. Manoj Tripati

1
 CERTIFICATE

It is certified that the work contained in the project report titled Financial
Performance Analysis of H.D.F.C Bank by Vijaya Krishna, has been
carried out under my/our supervision and that this work has not been
submitted elsewhere for a degree.

Signature of Supervisor: ___________________

Name : ___________________

Department : Commerce

ASHA MAHAVIDYALAYA,

BABATPUR

VARANASI

2
 DECLARATION

I hereby declare that this project report entitled Financial Performance

Analysis of H.D.F.C Bank was carried out by me for the degree of M.Com
under the guidance and supervision of Dr. Manoj Tripathi, Associate
Professor of Department of Commerce, ASHA MAHAVIDYALAYA. The
interpretations put forth are based on my reading and understanding of the
original texts and they are not published anywhere in any form. The other
books, articles and websites, which I have made use of are acknowledged at
the respective in the text. This research report is not submitted for any
other degree or diploma in any other University.

Place: Varanasi

Name of the Student: Vijaya Krishna

Class & Section: M.Com First Sem

Date:

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 ACKNOWLEDGEMENT

No task is a single man’s effort. Any job in this world, however trivial or
tough, cannot be accomplished without the assistance of others. An
assignment puts the knowledge and experience of an individual to litmus
test. There is always a sense of gratitude that one likes to express towards
the persons who helped to change an effort in success.

I would like to thank our principal for their immense support and
blessings. I would like to express my special thanks to my research guide,
Professor of Department of Commerce for valuable suggestions and
guidance and for giving me the golden opportunity to do this wonderful
research project on this topic: Financial Performance Analysis of H.D.F.C
Bank. Also, I would like to thank my parents and friends who helped me a
lot in the preparation of this project.

I wish to acknowledge the help of all those who have provided me

information, guidance and other help during my research period.

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 ABSTRACT

Financial performance analysis is the process of measuring how effectively

a company utilizes its assets from primary mode of business to raise
incomes. The study used 5 years of HDFC’s secondary data, and the main
objective is to find out the performance ratio of the bank that can be
helpful in finding the growth aspects of the bank. The various look like
Return on assets ratio, Interest coverage ratio, and other performance ratio
were used for study. The suggestions reveal the bank is generating
sufficient income and they are making better profits but the efficiency of
the bank in generating profits is limited. Finally, Bank is performing well in
terms of income, and it is satisfactory.

KEYWORD: HDFC Bank, Ratios, Financial Statements, Private Sector,

Solvency.

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 CONTENTS

Items Page no.

CHAPTER 1 : INTRODUCTION

1.1 Background 14
1.2 Review of the Literature 19
1.3 Objective of the study 20
1.4 Research question 20
1.5 Limitations of the study 20
1.6 Research Methods 21

CHAPTER 2 : DATA ANALYSIS AND

INTERPRETATION

2.1 Data Analysis 25

2.2 Short Term Solvency Ratio 25

2.3 Long Term Solvency Ratio 28

2.4 Balance Sheet 39

2.5 Profit and Loss Account 40

2.6 Cash Flow 42

2.7 Capital Adequacy 42

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2.8 Quality Assets 43

2.9 Consolidated Financial Returns 43

CHAPTER 3: CONCLUSION

3.1 Findings 45

3.2 Suggestions 46

3.3 Conclusion 47

BIBLIOGRAPHY 49

ANNEXURES 52

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 LIST OF TABLES
TABLE NO. TITLE

1 Current Ratio

2 Quick Ratio

3 Fixed Assets Turnover Ratio

4 Debt-Equity Ratio

5 Return on Assets

6 Return on Equity

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 SUMMARY OF THE REPORT

The Report is about the Financial Statement Analysis, So it suggest the

comparison of the income and expenses of the particular company during a
financial year on a YOY basis. Foer example here HDFC Bank shows the
income statement and the financial position of the company statement. Income
statement shows the income source and from the revenue is generated and
where we have to decrease the expances. Balance Sheet shows the current
position in the market i.e the Goodwill. Also the loans which was taken by the
bank and how much given to the customers. And this all comparison done from
FY 2019 to FY 2021.

Chapter 1: Introduction:-

The introduction part suggest that how the financial statement is to be analyzed.
Also it shows the different financial products and also the various styles. It
usaually consist the balance sheet, P&L A/C, Cash flow etc.

Chapter 2: Data Analysis & Interpretation:-

After collecting all the data from the research methodology, all are interpreted
by various methods. Such as Horizontal Analysis, Vertical Analysis and others.
Also one example is also mentioned because of more understanding.

Chapter 3: Conclusion

Here the findings made after the data analysis and interpretation. Also according
to the three main objectives their findings is mentioned in detail. Also the

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suggestion is the there for future betterment. Conclusion is for the ending of the
study.

CHAPTER -1

INTRODUCTION

About HDFC Bank:-

HDFC bank is a private bank which was promoted by Housing Finance

Development Corporation. It was incorporated in the year 1994 and it started its
commercial operations in 1995. HDFC Bank’s philosophy is based on customer
focus, operational excellence, product leadership, and human values. HDFC

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bank limited is an Indian financial service company based in Mumbai,
Maharashtra.
The first two private banks in India which merged are Times Bank Limited
(owned by Bennett, Coleman and The Co./Times Group) and HDFC bank
limited on February 26, 2000. It would be intresting to know that the first bank
in India who launched an International Debit Card in association with VISA and
the Master Cared Maestro debit card as well.

HDFC VISION AND MISSION

Vision :
To be customer driven best managed enterprise that enjoys market leadership in
providing housing related finance.

Mission :
To provide a package of attractive financial services for housing purposes
through a competed and motivated team of employees using the state of the art
technology to maintain financial stability and growth of the organization which
is contributing to the national goal of providing descent housing to all.

Contribution of HDFC bank in the Ecomomy:

HDFC Bank has won award for offering products which are new and
innovative. It thus contributes towards the economy. The bank has also reduced
the poverty by providing more employment opportunities. It provides better and
speedy services to the customers also.

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History of HDFC bank:
HDFC Bank popularly named as Housing Development Finance Corporation
Limited was founded by Hasmukh Bhai Parakh in the year 1977. In the year
1994, the HDFC Bank was incorporated. The bank was promoted by The
Housing Development Finance Corporation which is the India’s largest housing
finance company. The Bank started operations as in January 1995. On 26
February 2000, Times Bank Limted owned by The Times Group ( Bennett,
Coleman &Co.) was merged with HDFC Bank Ltd. This was the first merger of
two private banks in India. Shareholders of Times Bank received 1 share of
HDFC Bank for every 5.75shares of Times Bank. On 23 May 2008, HDFC
Bank acquired Centurion Bank of Punjab taking its total branches to more than
1,000. The amalgamated bank emerged with a base of about Rs. 1,22,000 crore
and net advances of about Rs. 89000 crore. The balance sheet size of the
combined enitity is more than Rs. 1,63,000 crore

The business strategies of HDFC Bank Limited are:

 Increasing market share in India’s expanding banking.
 Delivering high quality customer service.
 Delvering more products to more customers.
 Maintaining current high standards for assets quality through disciplined
credit risk management.

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  Develop innovative products and services that attract targeted customers
and address inefficiencies in the Indian financial sector.
Thus, HDFC Bank is always trying to develop some new innovative product
which can satisfy the customers, It aims not only to deliver more products to
customer but also makes sure that it is delivering a quality service to its
customers. By doing this, HDFC Bank is contributing towards the Indian
economy. Future plan of HDFC is to launch 250 new branches. It also aims
to set up NBFC. The HDFC Bank is the second largest private sector bank in
India and It has won the NASSCOM CNB-TV 18 IT Innovation award for
the BEST IT DRIVEN INNOVATION IN BANKING (COMMERCIAL)
in the VERTICAL category.
THE BOARD OF DIRECTORS OF THE BANK ARE:
Name Designation
A.N. Roy Director
Aditya Puri CEO
Bobby Parikh Director
CM Vasudev Chairman
Kaizad Bharucha Additional and Executive Director
Partho Datta Director
Renu Kamad Director
Pandit Palande Director
Keki Mistry Director
Paresh Sukthankar Deputy Managing Director

1.1 BACKGROUND

Financial performance is the process of measuring how effectively a company

utilizes its assets from primary mode of business to generate income. It also
measures the organization's whole financial health over a particular period of

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time. The financial performance of the organization deals with the financial
strength and weakness of the bank, accurately establishing a relationship
between the Balance Sheet and Income Statement. This process helps to clearly
understand the growth of long-term and short-term banks.
HDFC Bank Limited (Housing Development Finance Corporation) was
incorporated in August 1994 with its registered office in Mumbai, India. HDFC
Bank commenced operation as a scheduled commercial bank in January 1995.
HDFC was amongst the first to receive an approved from the Reserve Bank of
India (RBI)to set up a bank in the private sector. HDFC Bank comprises of
dynamic and enthusiastic term determined to accomplish the vision of becoming
a World-class Indian Bank. The Bank has two subsidiary companies namely
HDFC securities Ltd and HDFC financial services Ltd. The bank deals with
three major key business segments namely retail banking services, wholesale
banking services and treasury operation. The retail banking segment serves
retail customers through a branch network and other delivery channels. These
segments raises deposits from customers and makes loans and provides other
services with the help of specialist product group to such customers. The
wholesale banking segment provide loans and non fund facilities and
transactions, services to corporate public sector units, government bodies,
financial institutions, and medium scale enterprises. The treasury segment
includes net interest earnings on investment portfolio of the Bank. The Bank’s
share is listed on the Bombay Stock Exchange Ltd. And the National Stock
Exchange of India Ltd. HDFC Bank was listed on the Bombay Stock Exchange
on 19 may 1995. The Bank was listed on the National Stock Exchange on 8
November 1995.
As of June 30, 2021, the Bank’s distribution network was at 5,653 branches and
16,291 ATMs / Cash Deposit &Withdrawal Machine (CDMs) across 2,917
cities / towns as against 5,326 branches and 14,996 ATMs / CDMs across 2,825
cities /towns as on June 30, 2020. 50% of the branches are in semi-urban areas.
In addition, the HDFC bank have 15,912 business correspondents which are
primarily manned by Common Service Centers (CSC) as against 6,546 business
correspondents as on June 30,2020 (source: HDFC Bank News Release). HDFC
Bank provides a number of products and services including wholesale banking,
treasury, auto loans, two-wheeler loans, credit cards and various digital
products. The total number of customers the bank created as on 31 st March 2019
was over 4.90 core upfrom4.36 core in the previous year. During FY 2019 the
bank added 316 banking outlets and taking the total to 5103 spreads across 2748
cities and towns.

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During the quarter, the country was hit by a second wave of COVID -19 with a
significant surge in cases following the discovery of mutant corona strains,
business activities remain curtailed for almost two thirds of the quarter. These
disturbances lead to a decrease in loan organizations ae well as efficiency in
collection efforts.
In Kohima HDFC Bank was established on 2011, with its registered office in
Mumbai. There are five (5) branches in Nagaland, spread across the state. Out
of which, there are two (2) branches in Kohima. One which is in Phezoucha,
New Secretariat Road, Kohima . And the other in Keziek near KFC Kohima,
Razhu Point, Kohima Under this branch (Kezieke), there are fifteen (15)
members working under the branch holding different post.
The first chapter deals with the introduction which includes a brief background
of HDFC Bank, objective of the study, limitations of the study, research
methods and the study period. The second chapter deals with analysis and
interpretation of various data through ratio analysis collected from the internet
and through interview. And the third chapter deals with the findings,
suggestions and conclusion drawn from overall analysis of the study.
The purpose of the study is to study the overall performance of HDFC Bank and
to know the profitability of the bank for the period 2019-2021.

USERS OF FINANCIAL STATEMENT ANALYSIS

There are different users of financial statement analysis. These can be classified
into internal and external users. Internal users refer to the management of the
company who analyzes financial statement in order to make decisions related to
the operations of the company. On the other hand, external users do not
necessarily belong to the company but still hold some sort of financial interest.

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These include owners, investors, creditors, government, employees, customers,
and the general public. These users are elaborated on below:
1. Management
The managers of the company use their financial statement analysis to make
intelligent decisions about their performance. For instance, they may gauge
cost per distribution channel, or how much cash they have left, from their
accounting reports and make decisions from these analysis results.
2. Owners
Small business owners need financial information from their operations to
determine whether the business is profitable. It helps in making decisions
like whether to continue operating the business, whether to improve business
strategies or whether to give up on the business altogether.
3. Investors
People who have purchased stock or shares in a company need financial
information to analyze the way the company is performaing. They use
financial statement analysis to determine what to do with their investments
in the company. So depending on how the company is doing, they will either
hold onto their stock, sell it or buy more.
4. Creditors
Creditors are interested in knowing if a company will be able to honor its
payments as they become due. They use cash flow anlaysis of the company’s
accounting records to measure the company’s liquidity. Or its ability to make
short-term payments.
5. Government
Governing and regulating bodies of the state look at financial statement
analysis to determine how the ecomony is performing in general so they can
plan their financial and industrial policies. Tax authorities also analyze a
company’s statement to calculate the tax burden that the company has to pay.
6. Employees
Employees need to know if their employment is secure and if there is a
possibility of a pay raise. They want to be abreast of their company’s
profitability and stability. Employees may also be interested in knowing the
company’s financial position to see whether there may be plans for
expansion and hence, career prospects for them.

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7. Customers
Customers need to know about ability of the company to service its clients
into the future. The need to know about the company’s stability of operations
is heightened if the customer (i.e. a distributor or procurer of specialized
products) is dependent wholly on the company for its supplies.
8. General Public
Anyone in the general public, like students, analysis and researchers, may be
interested in using a company’s financial statement analysis . They may wish
to evaluate the effects of the firm on the environment, or the economy is
running corporate social responsibility programs for improving the
community, the public may want to be aware of the future operations of the
company.

FINANCIAL PRODUCTS:
Types of financial products

 Shares: These represent ownership of a company. While shares are

initially issued by corporations to finance their business needs, they
are subsequently bought and sold by individuals in the share market.
They are associated with high risk and high returns. Return on shares
can be in the form of dividend payouts by the company or profits on
the sale of shares in the stockmarket. Shares, stocks, equities and
securities are words that are generally used interchangeably.

 Bonds: These are used by companies to finance their business

operations and by governments to fund budget expenses like
infrastructure and social programs. Bonds have a fixed interest rate,
making the risk associated with then lower than that with shares. The
principal or face value of bonds is recovered at the time maturity.

 Treasury Bills: These are instruments issued by the government for

financing its short term needs. They are issued at a discount to the face
value. The profit earned by the investor is the difference between the
face or maturity value and the price at which the Treasury Bill was
issued.

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  Options: Options are rights to buy and sell shares. An option holder
does not actually purchase shares, Instead, he purchases the rights on
the shares.

 Mutual Funds: These are professionally managed financial

instruments that involve the diversification of investment into a
number of financial products, such as shares, bonds and government
securities. This helps to reduce an investor’s risk exposure, while
increasing the profit potential.

 Certificate of Deposit: Certificates of deposit (or CDs) are issued by

banks, thrift institutions and credit unions. They usally have a fixed
term and fixed interest rate.

 Annuities: These are contracts between individual investors and

insurance companies, where investors agree to pay an allocated
amount of premium and at the end of a pre-determined fixed terms,
the insure will guarntee a series of payments to the insured party.

1.2 REVIEW OF THE LITERATURE

S. Muruganatham and S.K. Nerdish (2021) ‘A study on financial performance

analysis of HDFC Ltd’ analyzed financial performance through ratio analysis

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and examined the financial position with the use of different ratios. The
objectives of the study are to study the growth aspect of HDFC bank and
measure its financial results. The study has been made on various aspects of the
bank like interest, loans, assets, expenses, deposits, etc. The findings of the
study reveal that the bank has minority issues in managing the deposits and all
aspects are going well.
Nandhini Thakuelr (2020), “The study is conducted on financial statement
analyses of HDFC Bank with the time period of 2013-2018. The tools used in
this study were ratio analysis, cash and fund flow analysis. The objective is to
measure the efficiency of various properties of a bank. Research find that bank’s
financial performance was strong and suggested to providing more housing
loans to the development of the citizen of India.”
Bangaru Pushpalatha (2020) analyzed the financial statement of SBI. The
objectives of the study are to examine the portfolio of assets and liabilities in
SBI. The study reported that SBI has healthier managing and financial
efficiency. It is also reported that people refer to SBI for advanced loan
schemes.
Rajendran P (2019) analyzed the performance of HDFC Bank. Research
explained HDFC bank’s history. Current ratio, cash position ratio, Debt equity
ratio, proprietary ratio was good. The study finds that part of the working capital
of the bank was financed by long-term funds. Research concluded with a result
as HDFC Bank was the largest private sector in India and it’s financial
performance was strong during the period study.

1.3 OBJECTIVE OF THE STUDY

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  To find out the financial performance of the HDFC Bank for the
year 2019-2021.
 To analyze the financial performance of the Bank by using different
ratios.
 To study solvency ratio to measure the financial health of HDFC
Bank.
 To study liquidity ratio to measure the financial viability of HDFC
Bank.

1.4 RESEARCH QUESTION

 What is the financial position of the HDFC bank Kohima for the
period 2019-2021?
 What are the challenges and problems faced by the banking
business – HDFC Bank?

1.5 LIMITATIONS OF THE STUDY

 The study is only for the HDFC Bank confirmed to a particular
location.
 The present research is limited to only HDFC Bank and the data
of only three financial years i.e , 2019, 2020, 2021, which may
not give correct trend of the result.
 This study may not be extensive enough to cover all the ratios to
be considered in evaluating the financial soundness of the bank
accurately.

1.6 RESEARCH METHOD

1.6.1 Method and sources of data collection
The study is based on both primary and secondary data collection.

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Primary data is collected by going to an interview with the Bank manager, The
data was collected through in-person and phone calls, while secondary data has
been collected from reports of HDFC Bank, Journals, websites and other
published information.

1.6.2 The study period for data analysis

The study covers three (3) Year data for 2019, 2020, and 2021, in HDFC Bank.

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 CHAPTER -2

DATA ANALYSIS
AND
INTERPRETATION

2.1 FINANCIAL STATEMENT ANALYSIS:

Financial statement analysis (or financial analysis) is the process of reviewing
and analyzing a company's financial statements to make better economic

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decisions. These statements include the income statement, balance sheet,
statement of cash flows, and a statement of changes in equity. Financial
statement analysis is a method or process involving specific techniques for
evaluating risks, performance, financial health, and future prospects of an
organization.
It is used by a variety of stakeholders, such as credit and equity investors, the
government, the public, and decision-makers within the organization. These
stakeholders have different interests and apply a variety of different techniques
to meet their needs. For example, equity investors are interested in the longterm
earnings power of the organization and perhaps the sustainability and growth of
dividend payments. Creditors want to ensure the interest and principal is paid on
the organizations debt securities (e.g., bonds) when due.
Common methods of financial statement analysis include fundamental analysis,
DuPont analysis, horizontal and vertical analysis and the use of financial ratios.
Historical information combined with a series of assumptions and adjustments
to the financial information may be used to project future performance. The
Chartered Financial Analyst designation is available for professional financial
analysts.

HORIZONTAL AND VERTICAL ANALYSIS:

• Horizontal analysis compares financial information over time, typically from
past quarters or years. Horizontal analysis is performed by comparing financial
data from a past statement, such as the income statement. When comparing this
past information one will want to look for variations such as higher or lower
earnings.
• Vertical analysis is a percentage analysis of financial statements. Each line
item listed in the financial statement is listed as the percentage of another line
item. For example, on an income statement each line item will be listed as a
percentage of gross sales. This technique is also referred to as normalization or
common-sizing.

ANALYSIS OF FINANCIAL STATEMENTS OF HDFC BANKS:

A: MANAGEMENT DISCUSSION&ANALYSIS:

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• Macroeconomic and Industry Developments
India’s economy recorded a growth rate of 7.6 per cent in terms of real Gross
Domestic Product (GDP) in 2015-16. This was the highest in five years despite
the continued slowdown in global growth and two consecutive years of
deficient monsoons in India. Inflation moderated, with the average level of
Consumer Price Inflation declining to 5 per cent in 2015-16 from 6 per cent in
2014-15. Domestic manufacturing growth improved to a robust 9.5 per cent
compared to 5.5 per cent in financial year 2014-15. It reflects stronger value
addition due to subdued input prices, which was a result of the declining global
commodity cycle. Foreign Direct Investment inflows (FDI) increased by 40 per
cent in the April-December period of 2015 over the corresponding period of the
previous year.
A range of supply side measures, including prudent food stock management,
appropriate monetary policy action and subdued global commodity prices aided
the decline in inflation. Meanwhile, initiatives such as ‘Make in India, power
sector reforms, the liberalization of FDI rules and higher government capital
expenditure spending indicate an incipient revival in domestic investment
activity.
Going forward, weakness in private investment cycle and asset quality strain in
the banking sector could prevent a full-fledged recovery, though some
improvement in the growth rate is quite likely. Risks on the external front
continue to loom in the form of a wider emerging market slowdown, especially
on account of China and the likely volatility in global financia l markets.
The growth inflation mix should improve for 2016-17 as the Government is
expected to undertake more structural reforms and the RBI is likely to be more
accommodative in its monetary policy. Going by the Union Budget, the focus of
fiscal policy in the coming year will be the revival of rural economy and
sustained increase in capital expenditure. Besides, higher outlay on various
social sector programmes and implementation of Seventh Central Pay
Commission recommendations should boost consumption spending. Going
forward, headline GDP growth should increase to 7.8 per cent in 2016-17 from
7.6 per cent in 2015-16.

DATA ANALYSIS

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This chapter deals with data analysis and interpretation. The outcome of rhe
present study yields significant findings of HDFC Bank.
Some of the major ratio has been evaluated and interpreted for the purpose of
understanding the financial performance of the bank.
The following analysis shows the company’s performance during 2019 to 2021.
This analysis will help to understand the HDFCs past and current financial
position.

2.2 SHORT TERM SOLVENCY RATIO

These ratios measure the liquidity position of a firm. Liquidity ratios show the
relationship between a firm’s cash and other current assets to its current
liabilities. A liquid assets is one that can be eaisly converted to cash without
significant loss of its original value. Converting assets, especially cuurent assets
such as inventory and receivable to cash is the primary means by which a firm
obtains the hinds needed to pay its current bills. Liquidity ratio is particulary
increasing to short-term creditors.

2.2.1 CURRENT RATIO

An indication of a company’s ability to meet the short-term obligations, the

higher the ratio, the more liquid the company is. Current ratio establishes the
relationship between current assets and current liability. A current asset is
calculated by dividing the current assets by current liabilities. It measures the
short-term financial condition of the bank. If the current assets of a company are
more than twice the current liabilities, then the company is generally considered
to have good short-term financial strength. The purpose of this current ratio is to
give the bank the ability to pay off its short-term. The ratio is considered
desirable in the ratio 2:1.

TABLE: 1 Current Ratio

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YEAR 2019 2020 2021

CURRENT RATIO 0.94 0.39 0.39

(Source: HDFC Bank ratio 2010-2021)

0.94
1

0.9

0.8

0.7

0.6

0.5 0.39 0.39

0.4

0.3

0.2

0.1

0
2019 2020 2021

Series1

In table 2.1, shows that current ratio was 0.94 in 2019. It was
decreased to 0.39 in 2020 as well as 2021. This shows that current
ratio was not observed in 2.1 during any year.

2.2.2 LIQUID RATIO

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 Liquid ratio is also known as ‘quick’ or ‘acid test ratio.’ Liquid test
refers to assets which are quickly convertible into cash. Current assets,
other stock and prepaid expenses are considered as quick assets. The
quick ratio is calculated by deducting inventories from current assets and
then dividing the remaining by current liabilities. It measures the short-
term financial condition of the bank.

Quick assets =Total Assets /Total current liabilities

TABLE:2 Quick Ratios

YEAR 2019 2020 2021

QUICK RATIO 16.61 16.62 17.58
(Source: HDFC Bank quick ratio 2010-2021)

17.6

17.4

17.2

17

16.8

16.6

16.4

16.2

16
2019 2020 2021

Series1

From the above table it is clear that the company’s quick ratio is
increasing in 2021, it reaches 17.58.

2.3 LONG-TERM SOLVENCY RATIO

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2.3.1 Fixed Assets Turnover Ratio (FAT)

It is also called as Sales to Fixed Assets Ratio. It measures the efficient

use of fixed assets. This ratio is a measure of efficient use of fixed assets,
it is calculated as:

Fixed Assets Turnover Ratio= Cost of goods sold or Sales / Net Fixed
Assets

It measures the efficiency and profit earning capacity of the business.

High the ratio, greater is the intensive utilization of fixed assets and a
lower ratio shows under utilization of fixed assets. This ratio has a special
importance for manufacturing concerns where investment in fixed assets
is very high and the profitability is significantly dependent on the
utilization of these assets. It reveals how efficient company is at
generating sales from its existing fixed assets. A higher rate of fixed
assets turnover implies that management is using its fixed assets more
effectively. A higher FAT does not tell anything about a company’s ability
to generate solid profits or cash flows.

TABLE: 3 fixed assets turnover ratio

YEAR 2019 2020 2021

FIXED ASSETS 0.09 0.09 0.08
TURNOVER
RATIO (FAR)

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 0.09

0.088

0.086

0.084

0.082

0.08

0.078

0.076

0.074
2019 2020 2021

Series 1

2.3.2 Debt Equity Ratio

Theses ratios show the relationship between long-term debt and shareholders
fund. Mainly it is calculated to assess the financial soundness of long-term
policicies and to determine the relative shares of outsiders and shareholders.

A high debt equity shows the highest claims of creditors over assets of the firm
than those of shareholders. A high ratio reveals an unfavorable position of the
company. A low debt equity indicates lesser claim of creditors and a higher
margin is safe for them. The standard norm of this ratio 2:1 is satisfactory.

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TABLE : 4 Debt-Equity Ratio

YEAR 2019 2020 2021

DEBT-EQUITY 7.05 7.47 7.39
RATIO
(Source : HDFC Bank Debt equity ratio 2010-2021)

Dless

Debt-Equity Ratio

7.5

7.4

7.3

7.2

7.1

6.9

6.8
2019 2020 2021

Series 1

Table 1.3 explain debt equity relationship In the year 2019 , the ratio was7.05
followed by this it was increased by 7.47 during the year 2020 then was
decreased by 7.39 during the year 2021.

2.3.3 RETURN ON ASSETS (ROA)

The ratio of operating income to total assets measures the return on total assets
(ROA) offers interest and taxes. It provides an idea of the overall investment
earned by the firms. Before other none operating it also measures profit per
dollar of assets. It measures the productivity of assets regardless of how the
assets are financed by creditors or investors.

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TABLE: 5 Return on Assets

YEAR 2019 2020 2021

RETURN ON
ASSETS (ROA) 1.69 1.71 1.78
(Source : HDFC Bank returns on assets 2010-2021)

Return on Assets (ROA)

1.78

1.76

1.74

1.72

1.7

1.68

1.66

1.64
2019 2020 2021

Series 1

31
2.3.4 RETUEN ON EQUITY
Return on Equity (ROE) is the bottom line measured for the shareholders,
measuring the profits earned for each rupee invested in business.

TABLE: 6 Return on Equity

YEAR 2019 2020 2021
RETURN ON
EQUITY(ROE) 14.12 15.35 15.27
(Source: HDFC Bank Return on Equity 2010-2021)

Return on Equity (ROE)

15.4
15.2
15
14.8
14.6
14.4
14.2
14
13.8
13.6
13.4
2019 2020 2021

Series 1

From the above table it is clear that return on equity ratio is higher in 2020 and
lowest in the year 2019. It is clear that return on equity is decreasing as well as
increasing every year.

32
STUDY OF A BALANCE SHEET
MEANING:-
The balance sheet is one of the three fundamental financial statements and is
key to both financial modeling and accounting. The balance sheet displays the
company’s total assets, and how these assets are financed, through either debt or
equity. It can also sometimes be referred to as a statement of net worth, or a
statement of financial position. The balance sheet is based on the fundamental
equation: Assets = Liabilities + Equity
7 Tips For Reading A Balance Sheet

Reading The Balance Sheet

A Balance sheet, also known as a “statement of financial position,” reveals a
company’s assets, liabilities and owners’ equity (net worth). The balance sheet ,
together with the income statement and cash flow statement, make up the
cornerstone of any company’s financial statements. If you are a shareholder of a
company, it is important that you understand how the balance sheet is
structured, how to analyze it and how to read it.
The Balance Sheet Equation
The main formula behind balance sheets is: Assets = Liabilities +
Shareholder’s Equity
A company has to pay for all the things it owns (assets) by either borrowing
money (taking on liabilities) or taking it from investors (issuing shareholders’
equity). Total assets must equal the liabilities plus the equity of the company .
Know the Current Assets
Current assets have a life span of one year or less, meaning they can be
converted easily into cash. Such assets classes include cash and cash
equivalents, accounts receivable and inventory. Cash the most fundamental of
current assets, also includes non-restricted bank accounts and cheques. Cash
equivalents are very safe assets that can be readily converted into cash; U.S.
Treasuries are one such example. Account receivables consist of the short-term
obligations owed to the company by its clients. Companies often sell products
or services to customers on credit; these obligations are considered as current
assets. When a client pays, there’s a transaction from accounts receivables to
cash.

33
Know the Non-Current Assets
Non-Current assets are company long-term investments where the full value
will not be realized within the accounting year. They can refer to tangible assets
such as machinery, computer, buildings and land. Non-current assets can also ne
intangible, such as goodwill, patents or copyrights. While these assets are not
physcial in nature, they are often the resources that can make or break a
company :- for example the value of a brand name. Depreciation is calculated
and deducted from most of these assets, which represents the economic cost of
the asset over its useful life.
Learn the Different Liabilities
On the other side of the balance sheet equation are the liabilities. These are the
financial obligations a company owes to outside parties. Like assets, they can be
both current and long-term. Long -term liabilities are debts and other non-debt
financial obligations which are due after a period of a least one year from the
date of the balance sheet. Current liabilities are the company’s liabilities which
will come due, or must be paid, within one year. This includes both short-term
borrowings, such as the latest interest payment on a 10-year loan.
Learn about Shareholders’ Equity
Shareholders’ equity is the initial amount of money invested into a business. If,
at the end of the fiscal year, a company decides to reinvest its net earnings into
the company (after taxes), these retained earnings will be transferred from the
income statement onto the balance sheet into the shareholder’s equity account.
This account represents a company a company’s total net worth. In order for the
balance sheet to balance, total assets on one side have to equal total liabilities
plus shareholders’ equity on the other.
Analyze With Ratios
Financial ratio analysis uses formulas to gain insight into the cmpany and its
operations. For the balance sheet, using financial ratios (like the debt-to-equity
ratio) can show you a better idea of the company’s financial condition along
with its operational efficiency. It is important to note that some ratios will need
information from more than one financial statement, such as from the balance
sheet and the income statement.

34
CURRENT ASSETS:-
The term current assets represents all the assets of a company that are expected
to be conveniently sold, consumed, utilized or exhausted through the standard
business operations which can lead to their conversion to a cash value over the
next one year. Since current assets is a standard item appearing in the balance
sheet, the time horizon represesnts one year from the date shown in the heading
of the company’s balance sheet. Current assets include cash, cash equivalents,
accounts receivable, stock inventory, marketable securities, prepaid liabilities
and other liquid assets. In a few jurisdicitions, the term is also known as current
accounts.
The term contrasts with long-term assets, which represent the assets that cannot
be feasily turned into cash in the space of a year. They generally include land,
facilities, equipment, copyrights, and other illiquid investments.
Key Components of Current Assets
While cash, cash equivalents and liquid investments in marketable securities
(like interest bearing short term Treasury bills or bonds) remain the obvious
inclusion in current assets, the following are also included in current assets.
Accounts receivable
Which represents the money due to a company for goods or services delivered
or used but not yet paid for by customers, are considered current as long as they
can be expected to be paid within a year. If a business is making sales by
offering longer terms of credit to its customers, a portion of its accounts
receivables may not qualify for inclusion in current assets. It is also possible
that some accounts may never be paid in full. This consideration is reflected in
an allowance for doubtful accounts, which is subtracted from accounts
receivable. If an account is never collected, it is written down as a bad debt
expense, and such entries are not considered for current assets.
Inventory
Which represents raw materials, components and finished products, is included
as current assets, but the consideration for this item may need some careful
thought. Different accounting methods can be used to inflate inventory, and at
times it may not be as liquid as other current assets depending on the product
and the industry sector. For example, there is little or no guarantee that dozen
units of a high-cost heavy earth moving equipment may be sold for sure over
the next year, but there is a relatively higher chance of succcessful sale of a

35
thousand umbrella in the coming rainy season. Inventory may not be as liquid as
account receivables, and it block the working capital. If the demand shifts
unexpectedly, which is more common in some industries than others, inventory
can become backlogged.
Prepaid expenses
Which represent advance payments made by a company for goods and services
to be received in the future, are considerd current assets. Though they cannot be
converted into cash, they are the payments which are already taken care of Such
components free up the capital for other uses. Prepaid expenses could include
payments to insurance companies or contractors.
On the balance sheet, current assets will normally be displayed in order of
liquidity, that is the items which have higher chance and convenience of getting
converted into cash will be ranked higher. The typical order in which the
constituents of current assets may appear is cash (including currency, checking
accounts, and petty cash), short term investments (like liquid marketable
securities), accounts receivable, inventory, supplies and prepaid expenses.
Current Assets Formula and Example
The current assets formula is a simple summation of all the assets that can be
converted to cash within one year.
Current Assets = Cash + Cash Equivalents + Inventory +Accounts
Receivables + Marketable Securities + Prepaid Expenses + Other Liquid
Assets

Ratios using Current Assets or their Components

Owing to different attributes attached to the business operations, different
accounting methods and payment cycles. It often becomes a challenging
exercise to correctly categorize what all components can be termed as assets
over a given time horizon. The following ratios are commonly used to measure
a cpmapny’s liquidity position with each one using a different number of asssets
components against the current liabilities of a company.
The current ratio measure a company’s ability to pay short-term and long-term
obligations and takes into account the current total assets (both liquid and
illiquid) of a company relative to the current liabilities.
The quick ratio measures a company’s ability to meet its short-term obligations
with its most liquid assets. It considers cash and equivalents, marketable

36
securities and accounts receivables (but not the inventory) against the current
liabilities.
The cash ratio measures the ability of a company to pay off all its short-term
liabilities immediately, and is calculated by dividing the cash and cash
equivalents by current liabilities.
While the cash ratio is the most conservative one as it takes only cash and cash
equivalents into consideration, the current ratio is the most accommodating and
includes a wide variety of components for consideration as assets. These various
measure are used to assess the company’s ability to pay outstanding debts and
cover liabilities and expenses without having to sell fixed assets.
NON CURRENT ASSETS:-
Non-current assets are company long-term investments where the full value will
not be realized within the accounting year. Example of non-current assets
include investments in other companies, intellectual property (e.g. patents), and
property, plant and equipment. Non-curent asets appear on a company’s balance
sheet.
Other Non-current Assets
Other non-current assets include the cash surrender value of life insurance. A
bond sinking fund stablished for the future repayment of debt is classified as a
non-current aasets. Some deferred income taxes, goodwill, trademarks, and
unamortized bond issue costs are classified here as well
Prepaid Assets
Prepaid assets may be classified as non-current assets if the future benefit is not
to be received within one year. For example, if rent is prepaid for the next 24
months, 12 months is considered a current assets as the benefit will be used
within the year. The other 12 months are considered non-current as the benefit
will not be received until the following year.
LIABILITY:-
A liability is defined as a company’s legal financial debts or obligations that
arise during the course of business operations. Liabilities are settled over time
through the transfer of economic benefits including money, goods or services.
Recorded on the right side of the balance sheet, liabilities include loans,
accounts payable, mortages, deferred revenues and accured expenses.

37
Current versus Long-Term Liabilities
Business sort their liabilities into two categories: current and long-term. Current
liabilities are debts payable within one year, while liabilities are debts payable
over a longer period. For example if a business takes out a mortgage payable
over a 15-year period, that is a long-term liability. However, the mortgage
payments that are due during the current year are considered the current portion
of long-term debt and are recorded in the short-term liabilities section of the
balance sheet.
Ideally, analysts want to see that a company can pay current liabilities, which
are duet within a year, with cash. Some examples of short-term liabilities
include payroll expenses and accounts payable, which includes money owed to
vendors, monthly utilities, and similar expenses. In contrast, analsis want to see
that long-term liabilities can be paid with assets derived from future earnings or
financing transctions. Debt is not the only long-term liability companies incur.
Items like rent, deferred taxes, payroll, and pension obligations can also be
listed under long-term liabilities.
The Relationship between Liabilities and Assets
Assets are the things a company owns, and they include tangible items such as
buildings, machinery, and equipment as well as intangible items such as
accounts receivable, patents or intellectual property. If a business substract its
liabilities from its assets, the difference is its owner’s or stockholders’ equity.
This relationship can be expressed as assets - liabilities = owner’s equity.
However, in most cases, this equation is commonly presented as liabilities +
equity = assets.

38
BALANCE SHEET:
HDFC Bank balance sheet for the year 2019-2021
Balance sheet of HDFC Bank March 2021 March 2020 March 2019
(in crore) (in crore) (in crore)
EQUITIES AND LIABILITIES
SHAREHOLDERS FUND
Equity Share Capital 551.28 548.33 544.66
Total Share Capital 551.28 548.33
544.66advan
Reserves and Surplus 203,169.55 170,437.70 148,661.66
Total Reserves and Surplus 203,169.55 170,437.70 148,661.66
Total shareholder’s Funds 203,720.83 170,986.03 149,206.32
Deposits 13,35,060.22 11,47,502.29 9,23,140.93
Borrowings 1,35,487.32 1,44,628.54 1,17,085.13
Other Liabilities and Provisions 72,602.52 67,394.40 55,108.33
Total capital and Liabilities 17,46,870.52 15,30,511,26 12,44,540.71
ASSETS

Cash and borrowings with

Reserve Bank of India 97.304.74 72,205.12 46.763.62
Balances with Banks money
at call and short notice 22,129.66 14,413.60 34,584.01
Investments 4,43,728.29 3,91,826.66 2,90,587.88
Advances 11,32,836.63 9,93.702.88 8,19,401.22
Fixed Assets 4,909.32 43,191.92 9,030.01
Other Assets 45,925.89 53,931.09 49,173.97

39
Total Assets 17,46,870.52 15,30,511.26 12,44,540.71
(Source : HDFC Bank News Release)

INTERPRETATION: The capital of bank increased but at a low rate. There

is a huge fluctuation in the increase in Reserve and Surplus.
The bank is utilizing its reserve and surplus in an effective manner. The
investment has increased with a high rate. There has been a conistent decline in
fixed assets in 2020 and 2021. 43,191.92 and 4,909.32 respectively.

PROFIT AND LOSS ACCOUNT

HDFC Bank profit and loss account
Profit and loss account of March(2021) March(2020) March(2019)
HDFC Bank (in crore) (in crore) (in crore)
INCOME
Interest / discount on
advances/ bills 94,834.54 91,787.88 77,544.19
Income from investments 23,214.27 20,633.32 19,997.46
Interest on Balance with
RBI & Oother inter-bank
funds 2,341.25 1,828.93 635.70
Others 468.17 562.52 794.70
Total interest earned 1,20,858.23 1,14,812.65 98,972.05
Other income 25,204.89 23,260.82 17,625.88
Toal income 1,46,063.12 1,38,073.47 1,16,597.94
EXPENDITURE
Interest expenses 55,978.66 58,626.40 50,728.83
Payments to and Provision
for Employees 10,364.79 9,525.67 7,761.76

40
Depreciation 1,302.41 1,19.85 1,140.10
Operating expenses
(excluding Employee cost
and Deprreciation) 21,055.42 19,976.01 17,217.51
Total operating Expenses 32,722.63 30,697.53 26,119.37
Provision Towards Income Tax 11,644.77 9,833.15 12,129.61
Provision Towards deferred Tax -1,10.31 516.69 -1,008.12
Other provisions & contingencies 15,702.85 12,142.39 7,550.08
Total provisions and
contingencies 26,245.31 22,492.23 18,671.57
Total Expenditure 1,14,946.59 1,11,816.15 95,519.77
Net Profit / Loss for the year 31,116.53 26,257.32 21,078.17
Profit / Loss Bought Forward 57,492.40 49,223.30 40,453.42
Total Proft / loss available
for appropriation 88,608.93 75,480.62 61,531.58
(source: HDFC Bank News Release)

41
HDFC Bank Cash Flow

Cash flow statements of HDFC Bank for the year 2019-2021

March 2021 March 2020 March 2021
Net profit/ loss before
extraodrinary items
and Tax. 41658.98 36,607.15 32,199.66
Net cash flow from
operating Activities 41,494.79 -16,689.78 56,054.67
Net cash used in
investing Activities -1,120.17 -1,104.92 -136.12
Cash flow used from
financial Activities -7,381.11 22,851.79 15,718.00
Foreign Exchange Gain/
Losses -141.83 213.99 95.39
Net increase/ decrease
in Cash Equivalent 3,285.68 5,271.08 -41,567.44
Cash & Cash equivalent at
the beginning of the year 86,618.72 81,374.64 1,22,915.408
Cash & Cash equivalent at
the end of the year 1,19,470.40 86,618.72 81,347.64
(Source: HDFC Bank News Release)

42
QUALITY ASSETS
Gross non-performance assets were at 1.47% of gross advances as on June
30,2021, (1.3% excluding NPAs in the agricultural segment) as against 1.32%
as on March 31, 2021 (1.2% excluding NPAs in the agricultural segment) and
1.36% as on June 30,2020 (1.2% excluding NPAs in the agricultural segment).
Net non-performing assets were at 0.48% of net advances as on
June 30,2021.
The Bank held floating provisions of Rs 1,451 crore and contigent provisions of
Rs.6,596 crore as on June 30, 2021. Total provisions (comprising specific,
floating, contingent and general provisions) were 146% of the gross non-
performing loans as on June 30,2021.

CONSOLIDATED FINANCIAL RESULTS

The consolidated net profit for the quarter ended June 30, 2021 was Rs 7,922
corresponding. Advances grew by 13.7% from Rs 10,53,683 corresponding as
on 2020 to Rs 11,97,876 crore as on June 30, 2021.

43
CHAPTER -3

CONCLUSION

44
3.1 Findings
 The bank focuses on understanding the needs of customers and offering
them superior products and services.
 They focus on to create quality of customers and non quanity of
customers.
 Current ratio indicates that banks liquidity and it’s repayment of debts are
sound during the period of study.
 Debt equity ratio explains that creditors are safe during the study period.
 The Balance Sheet size as on March 2021 was Rs.17,46,870.52 crore as
against Rs.15,30,511.26 crore as on March 2020, a growth of 13.5%.
 The total deposit as of 2021 were 13,35,060.22, an increase of 13.2%over
March 2020.
 The advances as on March 2021 were 13,35,060.22, an increase of
14.4%over March 2020.
 There has been a consistent decline in fixed assets in 2020 and 2021,
43,191.92 and 4,909.32 respectively.
 The Bank’s net revenue (net interest income plus other income) increased
from 1,38,073.47 crore for the quarter ended March 2020 to 1,46,063.12
crore for the quarter ended March 2021.
 Other income (non-interest revenue) at 25,204.89 crore was 27.0% of net
revenue for the quarter ended March 2021 and grew by 54.3% over
23,260.82 crore in the corresponding quarter of the previous year.
 Provision and contingencies for the quarter ended March 2021 were Rs.
26,245.31 crore as against Rs.22,492.33 crore for the quarter ended
March 2020.
 As mentioned earlier, the second wave of COVID-19 disrupted business
activities for close to third of the quarter, leading to a decrease in the
efficiency in collecting efforts and a high level of provisions.

45
 Suggestions

 The company should increase the profit margin after the acquisition the
profit margin it’s continually lower then following years.
 2014 tax ratio also increased the company should construct provision tax.
 The return on assets in HDFC Bank is in decreasing trend. The HDFC
Bank should take necessary steps to improve the return on assets.
 Before acquisition the borrowing is low but in the year2010 the
borrowing level of HDFC Bank it’s very high so HDFC Bank
concentrates in this regard.
 Bank should increase the rate of saving account.
 Bank should provide loan at the lower interest and education loans should
be given with ease without much documentation. All the banks must
provide loans against shares.
 Fair dealing with the customers. More contribution from the employee of
the bank. The staff be cooperative, friendly and must be capable of
understanding the problems of customers.
 Internet banking facility must be made available in all the banks.
 Bank should obey the RBI norm and provide facilities ass per the norms,
which are not being followed by the banks. While the customers must be
given propmt services and the bank officer should not have any fear on
mind to provide the facilities as per RBI norm to the units going sick.
 Prompt dealing with permanent customers and speedy transaction without
harrassing the customers.
 Each section of every bank should be computerized even in rural areas
also.
 Real time gross settlement can play a very important role.
 More ATM coverage should be provided for the convenince of the
customers.
 Better inventory management is required because it is consistently
decreasing which is an obstacle be in competition.
 There are market leader but their nearest competitor is very close with
respect to market share. So it is necessary to utilize their resources in best
way.

46
3.3 Conclusion
Over the years the Indian Banking Sector through various phases. The first
phase is considered as the ‘infancy’ phase up to independence i.e. 1974. During
this time period banking system developed on the privatized basis. The total
number of commercial banks have been 648 with total deposits of Rs 1.80
crore, advances of Rs 475 crore and Credit deposit ratio of 43.99 percent on the
eve of independence. For the development and growth of banking sector serval
important steps have been taken up such as nationalization of Reserve Bank of
India in 1948. Enactment of Banking Regulation Act in 1949, emergence of
State Bank of India in 1955 and its subsidiary banks during 1959-60 etc. In
1967 Indian Government 338 initiated the scheme of social control and 14
major Indian Scheduled Commercial Banks have been natioanlized. It have
been reported that 73 scheduled commercial banks having total deposits of Rs.
4661 crore, advances of Rs. 3599 crore and credit-deposit ratio of 77.5 percent
on the eve of nationalization. Nationalization of banks has been considered as
one of the bold and major steps in the process of banking sector reforms in
India. As a result of this Public Sector Banks control over 90 persent of banking
business, Indian banking structure emerged as strong and viable with rigorous
control enforced by the RBI during this period.
The post nationalization period has been earmarked with rapid branch
expansion, wide geographical pentration impressive growth in deposit
mobilization as well as in credit expansion. However, there have been serval
adverse factors such as high fixed and operating costs, organizational weakness,
lack of internal control, defective accounting policies, under capitalization,
political interference etc. which severely damaged productivity, profitability and
efficiency of banking sector. Since Independence Banking Sector has been
dominated by Private Sector Banks, 14 major scheduled banks were
nationalized in the year 1969 and 6 more were nationalized in the year 1980.
But Reserve Bank of India has issued guidelines immediately after
liberalization, Privatization and a globalization. Policy adopted by India in 1993
RBI has issued specific guidelines for Private Banks. Today Private Sector
Banks are comparatively performing better than Public Sector Banks therefore
the study is mainly focusing on three private banks namely AXIS, HDFS and
ICICI Bank for the period 2005-06 to 2014-15. The following revelations have

47
appeared: As Compare to Public Sector Bank, 47 Private Banks are having
increasing trend for deposits as well as for the growth of investment.
• Consolidation of players through mergers and acquisitions
• Development of new technology
• Globalization of operations
• Integrated Risk Management

HDFC Bank is a largest private sector bank in India. The reasearch was on
financial performance of HDFC Bank for three years from 2019-2020 The data
has been collected from annual reports of the bank and the website. The data
was analyzed through ratio analysis. The research presented sought to know the
financial viability and financial health of HDFC Bank. For this tables and ratio
analysis were used to analyze and interpret the information obtained
.
HDFC Bank deals with three key business segments:
 Retail Banking Services
 Wholesale Banking Services
 Treasury operation

Retail banking business caters to; Salaries and professional borrowings,

Individual borrowing, Micro &Small business, Extremely small business like
kirana stores, Self-help Group (SHGs), Non -resident Indians (NRIs).
Wholesale banking business focuses on the institutional customers such as;
Large corporate including MNCs Public Sector Enterpries, Emerging corporate,
Business banking / SMEs, Infrastructural finance groups.
Treasury is the custodian of the Bank’s cash/ liquid assets and manages its
investments in securities and other market instruments. It manages the liquidity
and interest rate risk on the balance sheet and is also responsible for meeting
statutory reserve requirement.

48
BIBLIOGRAPHY

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performance: Evidence from the UK’, in Journal of accounting and
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Performance Analysis of HDFC Ltd.”

49
  Bangaru Pushpalata (2020) , Financial Performance Analysis of SBI
anempirical study.
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analysis of HDFC Bank.
 P Rajedra (2019) analyzed the performance of HDFC Bank.
https://www.marcotrend
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https://www.hdfcbank.com
https://www.slideshare.net

JOURNAL:-

 An Exploratory Study on Management Support Services and Its effects

on the Quality Service Delivery of Internal Auditors in the Northern
Ghana by Dawuda A, Ataribanam S and Joseph AA.
 A Need for Theorizing Corporation: An Accounting Perspective by Al-
Adeem KR. .
 Implementing strategic financial management for clinical research by
Brandon Furr and Tucker Griffith.
 Impact of 2008 Financial Crisis On Earnings Quality :IFRS and US
GAAP Differential Case of France and United States by Slaheddine T and
Fakhfakh H.
 Accounting Factors Affecting the Capital Structure in the Asian
Economic Community by Matthias Nnadi.

RESEARCH PAPERS:

 Mirko S. Heinle, Kevin Smith, Robert E. Verrecchia (2018), Risk-Factor

Disclosure and Asset Prices, The Accounting Review,
 Salman Arif, John Kepler, Joseph Schroeder, Daniel Taylor (Working),
Audit Process, Private Information, and Insider Trading.

50
ANNEXURES

51
ANNEXURES:
APPENDICS: A
LIMITATIONS:
 A company’s profitability, liquidity, solvency and efficiency may be
affected by numerous factors but in this research work the impact that
Financial Leverage has on them has been analysed.
 For this research work, the impact of Financial Leverage has been studied
with regard to the profitability, liquidity, solvency and efficiency of the
selected Indian companies from seven different industries. Financial
Leverage may have several other effects on a company which are beyond
the purview of this research.
 Field of study is limited to only Indian industries and the companies
belonging to them. There are so many other companies in foreign
countries which may be considered for analysis. But since the study is
limited to Indian industries, only Indian listed companies have been
selected for the study.
 Financial analysis is based on selected accounting ratios.
 The study covers only financial information and ignores completely
qualitative aspects. Hence performance valuation of the company from
qualitative aspects has been ignored.
 The accuracy of the study depends upon the accuracy of the financial data
of the respective company. Thus this study carries such limitation.
 For the research work primary and secondary data can be used but
considering the nature of this research work only secondary data areused.
 A Study is undertaken by individual researcher therefore all the limitation
of the individual researcher exists here also.

52
 APPENDICS: B
COST OF THE PROJECT:
Expenses Amount (Rs.)
Travelling Expenses 3000
Food Expense 1000
Internet 1000
Spiral Binding 300
Black Book 2000
Total 7300

53