SUMMER TRAINING PROJECT

ON
OPERATION OF CASH AND BANK ACCOUNT
IN
NATIONAL FERTILIZER LIMITED
INTRODUCTION
WHAT IS FINANCE?

Finance is defined as the provision of money at that time when it is

required. Every enterprise, whether big, medium or small needs
finance to carry on its operation and to achieve its targets. In fact,
finance is so indispensable today that is lightly said to be life blood
of enterprise without adequate finance, no enterprise can possibly
accomplish its objectives.
Functions of finance department
 
1-Effective management of financial resources of the company.
2- Establish and maintain system of financial control, internal check and
render advice on financial and accounting matters including
examination of feasibility reports and detailed project.
3-Establish and maintain proper system of budgetary control, cost
control and management report.
4-Maintain financial account and compile annual / periodical account in
accordance with the companies Act.1956, ensuring the audit of accounts
as per law / government declaration.
5-Timely payment of all taxes, levies and duties under the law,
maintenance of record and filing return / statement connected with the
appropriate authorities as per law.
What is cash account ?
Cash accounts of a company are opened in a separate book called
cash book because it is quiet unpractical and inconvenient to
record all transactions in the journal .All cash transactions are
recorded in cash book or cash book is used for recording all the
receipts and payments of money whether in coins, notes, cheques ,
postal orders , bank drafts etc. Cash book is a type of subsidiary
book kept by business and it is the principal book of double entry
system.
What is a bank account?
Today it is a common practice to deposit cash and cheques received
with the payment through bank. Cash dealing through bank is
always safe and convenient. various types of accounts opened with
the bank viz. fixed deposit a/c , saving bank a/c, current a/c and
home safe a/c etc. the business records all its banking transaction
in its three column or bank column cash book whereas the bank
records all its transaction with its customers in its ledger accounts
 OBJECTIVE OF THE STUDY
 
1-To understand the working of cash and bank department as well
as other finance department of the company.
2-To know the importance of keeping book of records in a
company.

3-To estimate the operational efficiency of the firm .

 RESEARCH METHODOLOGY
 
The report has been prepared on the basis of information collected
from different sources. In order to achieve the objective of the
project proper research method was applied.. After giving through
brain storming session, objectives were selected and the set on base
of these objective
DATA COLLECTION SOURCE

SECONDARY DATA-
 
Secondary data are those which has been collected by some one
else and which already have been passed through statistical
process. Secondary data has been taken from internet,
newspaper, magazines and companies web sites.
Some of the sources which will be used are:
 
-Technical and trade journals.
-Books, magazines and newspapers.
-Reports prepared by research scholars.
-Public records and statistics historical documents.
-Websites.
 COMPANY PROFILE

NFL, a profitable public sector undertaking operates under the

administrative control of Department of Fertilizers in the
Ministry of Chemicals & Fertilizers. NFL was incorporated on
23rd August 1974 with two manufacturing Units at Bathinda and
Panipat. Subsequently, on the reorganization of Fertilizer group
of Companies in 1978, the Nangal Unit of Fertilizer Corporation
of India came under the NFL fold.
Three of the Units are strategically located in the high
consumption areas of Punjab and Haryana. The Company
expanded its installed capacity in 1984 by installing and
commissioning of its Vijaipur gas based Plant in Madhya Pradesh
The Vijaipur Plant was a landmark achievement in project
management in India. The plant was completed well within time
and approved project cost. In recognition of this achievement, the
project was awarded the First Prize in Excellence in Project
Management by Govt. of India. Subsequently the Vijaipur plant
doubled its capacity to 14.52 lakh MTs by commissioning Vijaipur
Expansion Unit i.e. Vijaipur-II in 1997. The plant annual capacities
have now been re-rated w.e.f. 1.4.2000 from 7.26 lakh MT of Urea
to 8.64 lakh MT for Vijaipur-I & Vijaipur-II Plants each. The
plants at Nangal, Bathinda and Panipat are based on partial
oxidation of Fuel Oil (F.O.)/High Petroleum Stock (H.P.S.), where
as Vijaipur unit is based on natural gas as feed stock/raw material.
All the plants are running at more than their rated capacities
NFL’s PRODUCTS:

Nitrogenous Fertilizers
Kisan khad
Kisan urea

Biofertilizers
Phosphorus solubilizing bacteria (PSB)
Rhizobium
Neem coated urea
Azotobacter
Compost Inoculants
OBSERVATION & ANALYSIS

current ratio

2009-10

current ratio

2008-09

0 0.5 1 1.5 2 2.5 3 3.5 4

INTERPRETATION

The current ratio of the company in year 2008-09 is 2.09 and its has increased to 3.38 in year 2009-10 this
shows that company is very well maintained in its working capital hence financial position of the company is
very sound

liquid ratio

2.5

2
liquid ratio
1.5

0.5

0
2008-09 2009-10
INTERPETATION
 
The liquid ratio of the company in 2008-09 is 1.046 and it
has been increased to 2.187 times in 2009-10, this shows
that companies is very well mainaging its liqiudity

2.5

1.5 year
2008-09
1 2009-10

0.5

0
1
INTERPRETATION
       This ratio shows how rapidly the inventory is turning into
receivable through sales. In 2009 the company has high inventory
turnover ratio but in 2010 it has reduced to 1.8 times. This shows that the
company’s inventory management technique is less efficient as compare

to last year .
 FINDINGS

1-Company is very well in managing its financial matters.

2-Company is very well in keeping its records in the form

of bank reconcilation statement.

3-Company records are very informative it helps other

departments to function smoothly.

4-Company continuously increasing its cash flow and

working capital turnover ratio this shows that company is
financially getting strong
 LIMITATION OF THE STUDY

1-The research is based on secondary data which may not be

accurate.

2-Influenced by personnal judgments.

3-Due to lack of training period its not possible to understand

all the functions of the finance department.

4-Sufficient data is not provided by the finance department .

CONCLUSION
-After the study of cash & other sections of N.F.L it can be concluded
that working of all departments are related to each other. For the
sound functioning of organization it is really important there is better
co-ordination between all of them.
-Central account section is the section which co-ordinates and checks
the activities of F&A department. As per the theory, the accounting
deals only with the terms like asset & liabilities, Profit & Loss and
Balance sheet etc. But in routine book keeping, there are deviations in
the practical accounting and theory.
-The functioning of all the departments of finance is very systematic
and regular. More emphasis is given to the accuracy of all the
accounting transactions.
-N.F.L is capable of meeting its short term & long term expenses out
of its own income. Holding a large pie of market share it gives a stiff
competition to all its competitors
SUGGESTION

1-Cash & Bank Section should utilize the E-banking facilities

provided by the bank as it will reduce there work load.
2-Internet facilities should be provided in all the sections of F& A.
3-More number of computers should be installed in cash & bank
section so that the work load on a single system can be reduced.
4-To error is human but there is no place for mistakes in
accountancy. So more attention should be paid to reduce the
chances of mistakes.
5-More manual work is carried out in F&A department they
should use the computers which can reduce there work giving them
more level of accuracy.
6-For the success of any organization the work and decision should
be time-bound. More attention should be paid in making timely
decision otherwise decision loose there relevance in today’s scenario
THANK YOU