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Financial Performance Analysis
Financial Performance Analysis
Financial Performance Analysis
INTRODUCTION
The financial
DEFINATIONS
According to John N.Myer The financial statements provide a summary
of the accounts of a business enterprise, the balance sheet reflecting the
assets, liabilities, and capital as on a certain date and the income statement
showing the results of operations during a certain period.
FINANCIAL STATEMENT
STATEMENT OF
INCOME STATEMENT
BALANCE SHEET
Income Statement
The income statement (also termed as profit and loss account) is
generally considered to be the most useful of all financial statements.
explains what has happened to a balance sheet dates.
It
income which is the focus of the income statement can be well understood if a
business is taken as an organization that uses inputs to produce output.
Balance Sheet
The term retained earnings means the accumulated excess earnings over
losses and dividends. The balance shown by the income statement is
transferred to the balance sheet through this statement after making necessary
appropriations. It is fundamentally a display of things that have caused the
beginning of the period retained earnings balance to be changed in to the one
show in the end-or-the-period balance sheet.
Recorded Facts
The term Recorded facts; refers to the data taken out from the
accounting records. The records are maintained on the basis of actual cost
data. The figures of various accounts such as cash in hand, cash at bank, bills
receivables, Sundry debtors, fixed assets are taken as per the figure recorded in
the accounting books.
costs the financial statements do not show current financial condition of the
concern.
Accounting Conversions
Certain
financial statements.
accounting
converters
are
followed
while
preparing
Postulates
The
accountants
make
certain
assumption
while
making
Personal Judgments:
Even though certain standard accounting conversions are followed
Attractive
Comparability
The
balance sheet.
Brief
Management
Creditors
The trade creditors are to be paid in a short period. The CRS will be
interested in current solvency of the concerns.
ratio and liquid ratio will enable the creditors to assess the current financial
position of the concerns in relation to their debts.
Investors
The investors include both short-term and long term investors. They are
interested in the security of the principal amounts of loan and regular
payments by the concern.
Government
Trade Associations
Stock Exchange
Financial statements are relevant and useful for the concern, still
they do not present a final picture of the concern, otherwise misleading
conclusions may be drawn. The financial statements suffer from following
limitation:
Historical Cost
The statements are prepared on the basis of historical cost. The
values of fixed assets are at there original cost less depreciation. The balance
sheet value are not shown the value of assets may be sold more over they do
not reflect the market value which is as important factor in determining the
solvency of an enterprise.
Personal Judgment
In preparing financial statements certain items are left to the
Conversion of Conservation
Due to conversion of conservation the income statement may not
FINANCIAL ANALYSIS
relationship between the items of the balance sheet, profit and loss account
and other operative data.
External Analysis
This analysis is done by those who are outsiders for the business.
These persons mainly depend up on the published financial statements.
analysis serves only a limited purpose.
Internal Analysis
Their
Horizontal Analysis
Vertical Analysis
Percentages of totals.
incurred by the cancers. The comparative study if income statement for more
than 1 year may enable us to know the program of the concern.
columns gibe figures of various items for two years.
First two
In first step, find out the changes in absolute figures i.e., increase or
decrease should be calculated.
Change in amount
Percentage of change =
Table No.1.1
x 100
PARTICULARS
Net Sales
(Less): Cost of
goods sold
Gross Profit
(Less): Operating
Expenses:Office &
Administration
Expenses
Selling &
Distribution
Expenses
Total Operating
Expenses
(Add): Operating
Incomes
Total Operating
Incomes
Operating Profit
(Add): NonOperating
Incomes:Income on
Investment
Profit on sale of
assets
Dividends received
Total NonOperating
Incomes
(Less): NonOperating
PREVIOUS
CURRENT
INCREASE/DECREASE
AMOUNT
PERCENT
(Rs)
AGE
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YEAR
YEAR
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Expenses:Loss on sale of
Fixed Assets
Net Profit Before
Interest & Tax
[EBIT]
(Less): Interest Paid
Net Profit Before
Tax
(Less): Income Tax
Paid
Net Profit After
Tax
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The increase
deducted from gross profit to find out operating profit and then
operating incomes should be added.
Table No.1.2
PROFORMAE OF COMPARITIVE BALANCE SHEET
PARTICULARS
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
Sundry Debtors
PREVIOUS
CURRENT
YEAR
YEAR
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INCREASE/DECREASE
AMOUNT
PERCENT
(Rs)
AGE
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Bills Receivable
Stock (Inventories)
Prepaid Expenses
Marketable Securities
Temporary Investments
Accured Incomes
Total Current Assets
Investments:
Short-term loans and
advances
Staff Advances
Other Advances
Fixed Assets: (F.A)
Good Will
Land
Buildings
Plant & Machinery
Furniture & Fittings
Free Hold Property
Lease Hold Property
Preliminary Expenses
Patent Rights
Trade Marks
Other Deferred Expenses
Total Fixed Assets
TOTAL ASSETS
[ C.A + F.A ]
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TOTAL LIABILITIES
[C.L + L.T.M + CAP. &
RES.]
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We must
Fixed assets must be compared with long term loans and capital. If
the increase in fixed assets is more than the increase in long term
financiers from the working capital which is not good.
Similarly various
The
increase in sales will certainly increases selling expression and volume of sales.
The increase in sales will certainly increases selling expresses and not
administrative or financial expenses. In case the volume of sale increases to a
considerable extent, administrative and financial expenses may go up. In case
the sales are declining, the selling expenses should be reduced at once. So, a
relationship is established between sales and other in income statement and
this relationship is helpful in evaluating operational activities of the
enterprises.
to year may not be studied and even they may not give proper results.
Table No.1.3
PROFORMAE OF COMMON SIZE BALANCE SHEET
Rs.Crs
Previous
Year
Percentage
Current
Year
Percentage
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TOTAL ASSETS
[ C.A + F.A ]
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Particulars
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
Sundry Debtors
Bills Receivable
Stock (Inventories)
Prepaid Expenses
Marketable Securities
Temporary Investments
Accured Incomes
Total Current Assets
Investments:
Short-term loans and
advances
Staff Advances
Other Advances
Fixed Assets: (F.A)
Good Will
Land
Buildings
Plant & Machinery
Furniture & Fittings
Free Hold Property
Lease Hold Property
Preliminary Expenses
Patent Rights
Trade Marks
Other Deferred
Expenses
Current Liabilities:
(C.L)
Sundry Creditors
Bills Payable
Out Standing
Expenses
Bank Over Draft
Unclaimed Dividends
Propose Dividends
Provision For Tax
Accrued Expenses
Total Current
Liabilities
Long Term Liabilities:
(L.T.M)
Mortigage Loan
Debentures
Total Long Term
Liabilities
Share Capital &
Reserves: (CAP. &
RES.)
Equity Share capital
Preference Share
Capital
Share Premium
General Reserve
Appropriation of Profits
Total Capital &
Reserve
TOTAL LIABILITIES
[C.L + L.T.M + CAP. &
RES.]
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TREND ANALYSIS
Trend analysis is an important and useful technique of financial
analysis. It involves computation of index numbers of the moments of the
various financial items in the financial statements for a number of periods. It
enables to know the changes in the financial position and the operational
efficiency between the period chosen.
Through trend analysis the analysis can give his opinion as to
whether favorable or unfavorable tendencies are reflected by the accounting
date.
The comparative and common size balance sheets suffer from a
major limitation i.e., absence of basic standard to indicate whether the
proportion of an item is normal or analysis values are calculated for each item
in isolation but conclusions are to be drawn by studying the related items also.
Trend analysis can be analysis in the following ways:
Select any year as base year the selected year should be normal year
for the base year the trend value is taken as 100.
------------------------- X 100
Base year value
COST-VOLUME-PROFIT ANALYSIS
Cost Volume Profit analysis is an important tool of profit
planning. It studies the relationship between cost, volume of production, sales
and profit.
RATIO ANALYSIS
Financial analysis depends to very large extents of the use of ratios
through there are other equality important tools of such analysis.
Thus, a
used for the purpose and whatever extrapolations appear necessary. They are
made to provide no indication of feature performance.
criticized the bankers for its lap sided development owing to their decisions
regarding the grant of credit on current ratios a lone, made the presentation of
an elaborate system of ratio analysis in1919.
Ratio
Ratio is an expression of the quantitative relationship that exists
between the two numbers. The ratio is defined as the indicated quotient of
two mathematical expressions the ratio should be determined between related
accounting variables to be meaningful and effective.
1981 for the first time; later in March 1997 it is revised and standard. All the
listed companies / Estates whose financial year ends on March 1996 and
thereafter will be required to give cash flow statement comes into effect
immediately i.e., on 15/02/1996.
INDUSTRY PROFILE
Steel comprises one of the most important inputs in all sectors of
economy. Steel is the basic input for automobiles, construction, and machine
building fabrication and transportation industries.
LOCATION
The plant is located on the coast of Bay of Bengal, 16 kms to the
south west of the Visakhapatnam port. It lies between the northern boundaries
of the National Highway No.5 from Madras to Calcutta and 7 kms to the southwest of Howrah Madras Railway line.
BACK GROUND
To meet the growing domestic needs of Steel, Government of India
signed an agreement with erstwhile USSR in 1979 for co-operation is setting up
3.4 Mt integrated steel plant at Visakhapatnam. The project was obtaining the
higher levels of operational efficiency and labour productively over maximum
output from the equipment already installed, planned for procurement,
achieving what was envisaged earlier. Under the rationalized concept,
3.0million tones of liquid steel is to be produced in estimated to cost
Rs.3897.28 crores, based on prices as on 4 th quarter of 1981. But during the
implementation of Visakhapatnam, it has been observed that the project cost,
mainly dues to price escalation and upper provisions in DPT estimates.
worked to 8200 crores as per the revised rationalized detailed project report.
PRODUCT MIX
Visakhapatnam steel plant products angles, channels, bars, wire
rods and billets for re-rolling. The plant also produces pig iron & 1.44 MT of
granulated slag, besides normal by- products from the coke oven and Coal
Chemical Plant.
The background of the entry of iron and steel into the public sector
in India, it would be desirable to trace if briefly, the history of iron and steel
making India through the centuries.
pre
Independence era was by the seventies. This result of bold steps taken by the
government to develop this sector.
1874
1899
1906
Formation of TISCO
1911
1916
1950-56
on 19th January, 1954; with the decision of setting up three steel plants each
with one million tones input steel per year at Rourkela, Bhilai and Durgapur,
TISCO
During the third five year the three steel plants under
HSL, TISCO & HSCO were expanded as show
TABLE NO 2.1
Steel plant
Rourkela
Original (MT/Year)
1.0
Expanded (MT/Year)
1.8
Bhilai
1.1
2.5
Durgapur
1.0
1.6
TISCO
1.0
2.0
IISCO
0.5
In January 1964
1966-69
1.0
- Bokaro steel plant came into existence.
- Recession Period.
The entire expansion programme was
actively
executed during this period.
- Fourth Five year plan
Salem Steel Plant started Licenses were given for
1969.74
scrolling mills.
Govt. of India accepted setting up two more steel
plants in South: One each at Visakhapatnam
on
1980-85
1985-91
1991-96
TECHNOLOGY
RINL was equipped with state of the art technology of steel making,
large-scale computerization and automation was incorporated in the plant to
achieve
International
Level
of
Efficiency
and
Productivity,
and
The following are some of the important technologies used in the plant.
7 meter tall coke over batteries with coke dry quenching plant
the
TABLE No 2.2
The Company Started Its Commercial Production in 1990-91 And Its
Financial Results
YEARS
92-93
93-94
94-95
95-96
96-97
97-98
98-99
99-00
00-01
01-02
02-03
03-04
04-05
05-06
Gross
Operating
Sales
Profit
245
-88
772
-101
1185
-31
1751
114
2209
416
3039
633
3135
606
3071
460
2761
15
2973
252
3436
504
4081
690
5058
1162
6169
2053
Interest
192
437
198
346
366
407
430
198
361
382
351
290
187
49
Depreciation
197
449
340
340
415
430
422
439
111
432
445
475
455
457
Net Profit
-478
-987
-568
-573
-364
-204
-246
-177
-457
-562
-291
-75
521
1547
06-07
07-08
08-09
8181
8482
9151
3271
2336
2219
11
31
48
1006
416
315
2254
1890
1363
09-10
10-11
10433
10410
2994
2022
31
88
471
240
1942
1336
It can be seen from the above table, during the year 2003-04, the
company turned around by earning a net profit of Rs.521 Crores. In the same
year, it bagged the PRIME MINISTER TROPHY for its excellent performance in
the Steel Industry. In October 2004, RINL became a DEBT FREE COMPANY.
Table No 2.3
Major Sources of Inputs
Raw Material
Iron Ore lumps and fines
BF Limestone Indigenous
Import
BF Dolomite
SMS Dolomite
Manganese Ore
Boiler Coal
Coking Coal
Coke
Quartz lump & Fines
Area/Location
Bailadilla, MP
Jaggayyapeta, AP
Dubai
Madharam, AP
Madharam, AP
Chipurapalli, AP
Talcher, Orissa
Australia
China
Garbhamam, AP
Water Supply:
Power Supply
Table No 2.4
Major Units of RINL
DEPARTMENTS
COKE OVENS
2261
BLAST FURNACE
3400
SINTER PLANT
5256
STEEL MELTING
SHOP
LMMM
WRM
MMSM
3000
710
850
850
volume
and
six
four
Strand
Bloom caster.
Four strand finishing mill
2x10 strand finishing mill
6 strand finishing mill
Table No 2.5
MAIN PRODUCTS OF VSP
STEEL PRODUCTS
Angles
BY PRODUCTS
Nut Coke
Billets
Coke Dust
Channels
Coal Tar
Beams
Anthracite Oil
Squares
Hp Naphthalene
Flats
Benzene
Rounds
Toluene
Re-bars
Zylene
Wire rods
Wash Oil
The company has become the first integrated steel plant in the
country to obtain the three International system standards certification -ISO
9001 for quality, ISPO 14001 for environment management and OHSAS
18001 for occupational health and safety
Table No 2.6
MILE STONE OF RINL
S. No.
Date
17-04-1970
June, 1970
30-11-1970
4
5
20-01-1971
27-02-1971
Milestone
Prime Minister of India announces
In parliament to construct a new steel plant at
Visakhapatnam
Site selection committee appointed
Committees report approved for site
Prime Minister
Foundation stone laid by
Consultant appointed feasibility
Reports submitted in 1972 and other Investigation
carried out.
6
7-04-1974
15-10-1977
24-05-1979
12-06-1979
19-10-1979
10
Jan. 1980
30-11-1980
13
6-01-1981
14
5-02-1981
15
23-02-1981
16
10-07-1981
17
23-01-1982
18
1-02-1982
19
18-02-1982
20
29-01-1987
and
units commenced
21
6-091989
22
14-11-1989
23
28-03-1990
24
3-05-1990
25
6-09-1990
26
28-09-1990
27
21-11-1990
28
4-30-1991
29
30-06-1991
30
28-10-1991
Merchant mills.
31
31-10-1991
32
27-12-1991
33
20-03-1992
37
Aug-1992
38
2001-02
39
2002-03
40
2003-04
41
2004-05
42
2005-06
43
2006-07
Mill Commissioned.
"KRISHNA" Blast furnace 2
Commissioned.
Coke Oven Battery No.3 Commissioned.
Convertor No. 3 of
Steel Melt Shop
Commissioned. This marks the completion of
commissioning of all the units of the 3 million
tonnes plant.
Dedication of the plant to the nation
By the Prime Minister
Surpassed rated capacity
Achieved Turnaround & Received
PM`s Trophy.
Became a Debt free Company
Achieved maximum Net Profit after tax.
Wiped out accumulated net losses.
Conferred Mini Ratna Status
44
2007-08
34
21-03-1992
35
July, 1992
36
July, 1992
HRD IN RINL
As a deliberate recruitment philosophy, RINL selected young skilled
Manpower and properly planned to induct them through carefully chalked out
training programs to understand about the Company. RINL today has young
and enthusiastic reservoir of dynamic and highly skilled manpower in the
average age group of 35-40 years. It also achieved excellence in production
front, working in overlapping shifts, task based performance appraisal and
productivity oriented training and management development.
OBJECTIVES
To work towards enabling the employees and other stake holders seek
self fulfillment even as they work for the growth and prosperity of the
company.
PRODUCTION FACILITIES
The production facilities in the RINL are most modern amongst the Steel
Industry in the country. The know-how and the technology have been acquired
from different parts of the world from the reputed/established manufacturers.
7 meter coke ovens of RINL are the tallest so far built in the country.
Base mix yard for sinter plant introduced for the first time in the country
helps in excellent blending of the faced material to sinter machine and
production of consistent good quality sinter.
3200 cubic meter two Blast Furnaces i.e. Godavari and Krishna with Bell
Less Top Charging Equipment and 100% cast house slag granulation, the
biggest to be set up in the country have done away with the conventional
bell charging system.
The operation of Blast Furnace, Steel Melting Shop and Rolling Mills has
been entirely computerized to ensure consistent quality and efficient
performance.
MARKETING IN RINL
It mostly
exports of steel to China, Japan, USA, Srilanka etc. RINL is now focusing on
expanding and consolidating its markets in these countries by entering into
long term tie ups with its clients.
about 260 executives and 15 non executives. The entire department is headed
by the general manager. Finance and Accounting Department of RINL is divided
into
several
sections
for
administrative
control
and
assignment
of
Stores Accounting
Sales Accounts
Cash Section
Corporate Accounts
Budget Section
Costing Section
Project Accounts
Concurrence Sections
Table No 2.7
FINANCIAL HIGHLIGHTS
2010-11
2009-10
10433
11337
8310
3027
2336
9151
9812
7540
2271
1750
2995
1943
2222
1363
7827
3654
9935
2249
7827
1711
9427
2321
11481
8901
7516
1385
1761
9523
8876
7085
1790
1203
29.00
18.60
26.40
16.90
24.80
14.90
23.80
14.30
103.90
75.40
19.60
38.70
16.90
105.00
14.50
29.00
13.10
97.10
3.60
3.70
Ratio Of
Current Assets To Current Liabilities
3.10
3.30
YEAR
HOT
METAL
LIQUID
STEEL
SALABLE
STEEL
POWER EXPORT
(MW) GROSS
2002-2003
3120
2530
2217
44.20
2003-2004
3120
2730
2411
45.40
2004-2005
3400
3000
2675
30.60
2005-2006
3850
3235
2900
6.30
2006-2007
3950
3300
2958
3.60
2007-2008
4000
3500
3125
-0.40
2008-2009
4100
3567
3205
-6.28
2009-2010
4100
3620
3210
2.03
2010-2011
3850
3450
3080
0.00
COMMERCIAL PERFORMANCE:
The commercial performance of VSP for the past four years is as
follows
Table No 2.9
(In corers)
SALES
YEAR
2002-2003
2003-2004
2004-2005
2005-2006
TURNOVER
3436
4080
5058
6169
DOMESTIC
CASH
SALES
PROFIT
3122
3710
4433
5406
153
399
975
2023
2006-2007
2007-2008
8190
8491
7942
8048
3259
2338
2008-2009
9151
8726
2584
2009-2010
10433
9878
3483
2010-2011
10140
8950
2652
FINANCIAL PERFORMANCE:
VSP had to bear the burnt of huge project cost right from the day of its
inception. This has affected the companys balance sheet due to very high
interest burden. The company, in spite of making operating profit every year
had to report net loss during all financial years. This on the other hand had
resulted in making VSP to take great care in planning the financial resources.
The financial performance of VSP for the past ten years is as follows:
Table No 2.10
YEAR
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
GROSS
CASH
NET
SALES
MARGIN
PROFIT
PROFIT
3435
4081
5058
6169
8181
8482
9151
10433
504
690
1162
2072
3271
2369
2632
3513
153
399
975
2024
3260
2337
2583
3482
291
(-) 75
521
1547
2008
1252
1363
1943
10410
2785
2652
1336
FUTURE PLANS:VISION:
To be a continuously growing world class company we shall
Deliver high quality and cost competitive products and be the first
choice of customers.
MISSION:
Be amongst top five lowest cost liquid steel producers in the world by
2010-11.
CORE VALUES:
Commitment
Customer Satisfaction
Continuous Improvement
CAPITAL COST:
Approved Cost
Debt component
Rs.4346 Crores
FE component
Rs.1477 Crores
5 years 2 months
IRR
23%
Rs.7998 Crores
SOURCES OF FUNDS:
VSP raise its working capital from of 10 Bankers. The following are
the 10 banks. Where funds for finance are raised.
Canara Bank
UCO Bank
Bank of Baroda
Andhra Bank
Allahabad Bank
Indian Bank
ICICI Bank
Maintain
high
level
of
environmental
committed
to
safety of
Sales Tax
- 12 Crores/month
Custom duty
- 12 Crores/month
Employee salary
- 35 Crores/month
Iron ore
- 15 Crores/month
Railway freight
- 50 Crores/month
Ocean Freight
- 15 Crores/month
Coal Blast
- 70 Crores/month
Sri A.P.CHOUDHARY
DIRECTOR (PERSONNEL)
Sri Y. R.REDDY
DIRECTOR (FINANCE)
Sri P.MADHUSUDAN
DIRECTOR (COMMERCIAL)
Sri T.K.CHAND
DIRECTOR (OPERATIONS)
DIRECTORS:-
COMPANY SECRETARY
REGISTRED OFFICE
ADMINISTRATIVE BUILDING,
Table No 2.12
MAN POWER AT A GALANCE
2010-2011
AS on 31/03/2010
4534
Executives
Works
Projects
Mines
Others
Junior Officers
Works
2745
316
71
1402
684
504
Projects
13
Mines
22
Others
145
12007
Works
10476
Non-Executives
Projects
Mines
Others
Total
63
267
1201
17225
Works
13725
Projects
392
Mines
360
Others
2748
The main aim of any firm is to maximize the wealth of the profits.
Which in turn depend on successful sales activity? To generate sales,
investment of sufficient funds in current assets is required. The need of current
assets should be emphasized, as the sales dont convert into cash immediately
but involved a cycle of operations, namely operating cycle.
To
know
the
long
term
solvency
position
of
RINL
through
As longer as the accounts bases remain more or less the some overtime,
meaningful mitered is can be drawn by examining trends in raw data and
financial ratios.
Since similar basis characterize various firms in the same industries, incur
firm comparisons are useful.
statement analysis in
steel industries.
The records are maintained on the boards of actual costs data.
Certain neither accounts nor conversions are followed while preprimary
financial statement. Still personal judgment
DATACOLLECTION
Primary data
Secondary data
Primary data:-
Secondary data:-
DATA SOURCES
DATA SOURCES
INSIDE THE COMPANY
SECONDARY SOURCES
PRIMARY SOURCES
MANAGEMENT
RESPONDENTS
PERSONAL OBSERVANCE
CHAPTERSATION
Chapter 2:
financial profile.
TABLE NO 4.1
COMPARITIVE BALANCE SHEET OF VSP LTD. FOR THE YEARS 2010-11.
Rs. Crs
INCREASE/DECREASE
PARTICULARS
2010
2011
7699.10 1
93.41
1761.15
1958.49
292.43
6624.17
191.27
3215.28
1569.69
258.91
AMOUNT(Rs)
PERCENT AGE
ASSETS:
CurrentAssets:(C.A)
Cash&BankBalances
Sundry Debtors
Stock (Inventories)
Loans & Advances
Other Current Assets
-1074.94
+97.86
+1454.13
-388.8
-33.52
+13.97%
+104.76%
+82.57%
-19.85%
-11.46%
11804.59
11859.32
-54.73
-0.46%
-----
-----
---
------
0.05
----
0.05
-----
0.05
------
0.00
-----
51.74
1.10
5.92
85.67
1.07
3.53
+33.93
-0.03
-2.39
+65.78%
-2.73%
-40.37%
96.81
106.56
+9.75
+10.07%
474.50
600.81
5.36
448.5
468.36
6.12
-26
-132.45
+0.76
-5.45%
-22.05%
+14.18%
11.08
3.80
59.68
9.69
4.80
54.63
-1.39
+1
-5.05
-12.55%
+26.32%
-8.46%
44.91
31.78
-13.13
-29.23%
25.42
32.32
+6.9
+27.15%
3.51
3.22
-0.29
-8.27%
0.04
2087.19
0.05
4617.81
+0.01
+2530.62
+25.00%
+121.25%
3471.92
5874.16
+2402.24
+69.19%
15276.51
17733.48
+2456.97
+16.08%
Miscellaneous
Assets:
Deferred Revenue
Expenditure
Investments
Profit & Loss a/c
Fixed Assets: (F.A)
Land-Free Hold
Land-Lease Hold
Railway Lines &
Sidings
Roads, Bridges &
Culverts
Buildings
Plant & Machinery
Furniture &
Fittings
Locomotives
Vehicles
Electrical
Installations
Water Supply &
Sewerage systems
Miscellaneous
Articles
Mining Lease
Rights
Held For Disposal
Capital Work-inprogress
Total Fixed Assets
TOTAL ASSETS
[ C.A + F.A ]
Current
Liabilities: (C.L)
Sundry Creditors
Advances from
Customers
Other Advances
Earnest Money,
Security & Other
Deposits
Interest Accured
but not Due
Other Liabilities
501.31
136.97
1149.44
137.46
+648.13
+0.49
+129.29%
+0.36%
1.57
99.32
1.43
137.87
-0.14
+38.55
-8.92%
+38.8%
4.89
0.14
-4.75
-97.14%
866.09
1134.45
+268.36
+30.99%
Total Current
Liabilities
Long Term
Liabilities &
Provisions: (L.T.M)
Provisions
Secured Loans
Unsecured Loans
Deferred Tax
Liability
1610.15
2560.79
+950.64
2.47%
1581.47
332.78
107.95
163.12
1620.53
907.72
100.04
124.49
+39.06
+574.94
-7.91
-38.63
+2.69%
+172.77%
-7.32%
-23.68%
2185.32
2752.78
+488.28
+22.34%
7827.32
3653.72
7827.32
4592.59
0.00
+938.87
0.00
+25.69%
11481.04
12419.91
+938.87
+8.18%
TOTAL
LIABILITIES
[C.L + L.T.M +
15276.51
17733.48
+2456.97
+16.08%
During the financial year 2011, the long-term liabilities were increased by Rs
488.28 i.e.;22.34 comparison to the previous year 2010.
TABLE NO 4.2
COMPARITIVE BALANCE SHEET OF VSP LTD. FOR THE YEARS 2009-2010.
Rs. Crs
INCREASE/DECREASE
PARTICULARS
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
Sundry Debtors
Stock (Inventories)
Loans & Advances
Other Current Assets
Total Current Assets
Miscellaneous Assets:
Deferred Revenue
Expenditure
Investments
Profit & Loss a/c
Fixed Assets: (F.A)
Land-Free Hold
Land-Lease Hold
Railway Lines &
Sidings
Roads, Bridges &
Culverts
Buildings
AMOUNT
(Rs)
PERCENT
AGE
2009
2010
7194.68
216.80
1203.24
1518.90
314.48
7699.11
93.41
1761.15
1958.49
292.43
+504.43
-123.39
+557.91
+439.59
-22.05
+7.01%
-56.91%
+46.37%
+28.94%
-7.01%
10448.10
11804.59
+1356.49
+12.98%
14.95
0.00
-14.95
-100.00%
0.05
0.05
0.00
0.00%
----
----
----
----
51.74
1.16
10.25
51.74
1.10
5.92
0.00
-0.06
-4.33
0.00%
-5.17%
-42.24%
82.39
96.81
+14.42
+17.50%
522.43
474.50
-47.93
-9.17%
926.29
3.95
16.21
1.96
73.49
68.54
600.81
5.36
11.08
3.80
59.68
44.91
-325.48
+1.41
-5.13
+1.84
-13.81
-23.63
-35.14%
+35.70%
-31.65%
+93.88%
-18.79%
-34.48%
28.15
3.90
0.00
597.19
25.42
3.51
0.04
2087.19
-2.73
-0.39
+0.04
+1490.00
-9.70%
-10.00%
+100.00%
+249.50%
2402.65
3471.92
+1069.27
+44.50%
12850.75
15276.51
+2425.76
+18.88%
365.83
119.91
501.31
136.97
+135.48
+17.00
+37.03%
+14.18%
2.02
82.54
1.57
99.32
-0.45
+16.78
-22.28%
+20.33%
18.41
4.89
-13.52
-73.44%
422.82
866.09
+443.27
+104.84%
1011.53
1610.15
+598.62
+59.18%
1092.77
604.45
312.51
1581.47
332.78
107.95
+488.70
-271.67
-204.56
+44.72%
-44.94%
-65.46%
291.29
163.12
-128.17
-44.00%
2301.02
2185.32
-115.70
-5.03%
7827.32
1710.88
7827.32
3653.72
0.00
+1942.84
0.00%
+113.56%
9538.20
11481.04
+1942.84
+20.37%
12850.75
15276.51
+2425.76
+18.88%
TOTAL LIABILITIES
[C.L + L.T.M + CAP. &
RES.]
INTERPRETATION
During the financial year 2010, the long-term liabilities were decreased
by Rs 115.70 i.e.; 5.03% comparison to the previous year 2009.
In comparison to the previous year i.e.; 2008 the current liabilities were
increased by Rs.598.62 i.e.; by 59.18%.
TABLE NO 4.3
COMPARITIVE BALANCE SHEET OF VSP LTD. FOR THE YEARS 2008-2009.
Rs. Crs
INCREASE/DECREASE
PARTICULARS
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
2008
2009
AMOUNT
(Rs)
5621.70
7194.68
+1572.98
PERCENT
AGE
+27.98%
Sundry Debtors
Stock (Inventories)
Loans & Advances
Other Current Assets
166.27
1218.35
1061.32
184.36
216.80
1203.24
1518.90
314.48
+50.53
-15.11
+457.58
+130.12
+30.39%
-1.24%
+43.11%
+70.58%
8252.00
10448.10
+2196.10
24.87
14.95
-9.92
+26.61%
%
-39.89%
0.00
0.05
+0.05
+100%
----
----
----
----
50.89
1.19
12.53
51.74
1.16
10.25
+0.85
-0.03
-2.28
+1.67%
-2.52%
-18.20%
67.17
82.39
+15.22
+22.66%
544.46
1179.46
3.68
19.20
1.72
85.51
73.71
522.43
926.29
3.95
16.21
1.96
73.49
68.54
-22.03
-253.17
+0.27
-2.99
+0.24
-12.02
-5.17
-4.05%
-21.46%
+7.34%
-15.57%
+13.95%
-14.06%
-7.01%
34.56
4.18
0.01
180.73
28.15
3.90
0.00
597.19
-6.41
-0.28
-0.01
+416.46
-18.55%
-6.70%
-100%
+230.43%
2283.87
2402.65
+118.78
+5.20%
10535.87
12850.75
+2314.88
+21.97%
Current Liabilities:
(C.L)
Sundry Creditors
Advances from
Customers
Other Advances
Earnest Money,
Security & Other
Deposits
Interest Accured but
not Due
Other Liabilities
275.04
120.19
365.83
119.91
+90.79
-0.28
+33.01%
-0.23%
1.60
68.89
2.02
82.54
+0.42
+13.65
+26.25%
+19.81%
8.43
18.41
+9.98
+118.39%
311.62
422.82
+111.20
+35.68%
785.77
1011.53
+225.76
+28.73%
716.37
173.87
369.44
316.72
1092.77
604.45
312.51
291.29
+376.40
+430.58
-56.93
-25.43
+52.54%
+247.64%
-15.41%
-8.03%
1576.40
2301.02
+724.62
+45.97%
7827.32
346.38
7827.32
1710.88
0.00
+1364.50
0.00%
+393.93%
8173.70
9538.20
+1364.50
+16.47%
10535.87
12850.75
+2314.88
+21.97%
Total Current
Liabilities
Long Term Liabilities
& Provisions: (L.T.M)
Provisions
Secured Loans
Unsecured Loans
Deferred Tax Liability
TOTAL LIABILITIES
[C.L + L.T.M + CAP. &
RES.]
INTERPRETATION
During the financial year 2009, the long-term liabilities were increased by
Rs 724.62 i.e.; 45.97% comparison to the previous year 2008.
In comparison to the previous year i.e.; 2008 the current liabilities were
increased by Rs.225.76 i.e.; by 28.73%.
TABLE NO 4.4
COMPARITIVE BALANCE SHEET OF VSP LTD. FOR THE YEARS 2007-2008
Rs. Crs
INCREASE/DECREASE
PARTICULARS
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
Sundry Debtors
Stock (Inventories)
Loans & Advances
Other Current Assets
Total Current Assets
Miscellaneous Assets:
Deferred Revenue
Expenditure
Investments
Profit & Loss a/c
Fixed Assets: (F.A)
Land-Free Hold
Land-Lease Hold
Railway Lines &
Sidings
Roads, Bridges &
Culverts
2007
2008
AMOUNT
(Rs)
PERCENT
AGE
3932.61
49.30
1257.53
710.12
100.18
5621.70
166.27
1218.35
1061.32
184.36
+1689.09
+116.27
-39.18
+351.20
+84.18
+42.95%
+235.84%
-15.21%
+49.46%
+84.03%
6049.74
8252.00
+2202.26
+36.40%
43.01
24.87
-18.14
-42.18%
0.00
0.00
0.00
0.00%
905.99
0.00
0.00
-100%
51.71
1.22
14.80
50.89
1.19
12.53
-0.82
-0.03
-2.27
-1.58%
-2.46%
-15.34%
62.84
67.17
+4.33
+6.89%
Buildings
Plant & Machinery
Furniture & Fittings
Locomotives
Vehicles
Electrical Installations
Water Supply &
Sewerage systems
Miscellaneous Articles
Mining Lease Rights
Held For Disposal
Capital Work-inprogress
568.88
1492.25
3.18
22.06
0.51
98.30
85.70
544.46
1179.46
3.68
19.20
1.72
85.51
73.71
-24.42
-312.79
+0.50
-2.86
+1.21
-12.79
-11.99
-4.29%
-20.96%
+15.72%
-12.96%
+237.25%
-13.01%
-13.99%
35.39
4.46
0.00
58.85
34.56
4.18
0.01
180.73
-0.83
-0.28
+0.01
+121.88
-2.34%
-6.28%
+100%
+207.10%
3449.16
2283.87
-1165.29
-33.78%
TOTAL ASSETS
[ C.A + F.A ]
9498.90
10535.87
+1036.97
+10.92%
218.39
102.90
275.04
120.19
+56.65
+17.29
+25.94%
+16.80%
4.64
51.20
1.60
68.89
-3.04
+17.69
-65.52%
+34.55%
2.39
8.43
+6.04
+252.72%
332.94
311.62
-21.32
-6.40%
712.46
785.77
+73.31
+10.29%
269.27
88.94
716.37
173.87
+447.10
+84.93
+166.04%
+95.49%
Current Liabilities:
(C.L)
Sundry Creditors
Advances from
Customers
Other Advances
Earnest Money,
Security & Other
Deposits
Interest Accured but
not Due
Other Liabilities
Total Current
Liabilities
Long Term Liabilities
& Provisions: (L.T.M)
Provisions
Secured Loans
Unsecured Loans
Deferred Tax Liability
442.42
158.49
369.44
316.72
-72.98
+158.23
-16.49%
+99.83%
959.12
1576.40
+617.28
+64.36%
7827.32
0.00
7827.32
346.38
0.00
+346.38
0.00%
+100%
7827.32
8173.70
+346.38
+4.42%
TOTAL LIABILITIES
[C.L + L.T.M + CAP. &
RES.]
9498.90
10535.87
+1036.97
+10.92%
INTERPRETATION:
During the financial year 2008, the long-term liabilities were increased by
Rs 617.28 i.e.; 64.36% comparison to the previous year 2007.
In comparison to the previous year i.e.; 2006-05 the current liabilities were
increased by Rs.73.31 i.e.; by 10.29%.
Current assets during the year 2008 have been increased by Rs.2202.36 in
comparison to previous year i.e.; 36.40% shows which that the working
capital of the company is strengthened. .
TABLE NO 4.5
COMMON SIZE BALANCE SHEET OF VSP LTD. FOR THE YEARS
Particulars
2010
Amount
Percent
age
2010-2011
Rs.Crs
2011
Percent
age
Amount
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
Sundry Debtors
7699.11
93.41
50.40%
0.61%
6624.17
191.27
37.45%
1.07%
Stock (Inventories)
Loans & Advances
Other Current Assets
1761.15
1958.49
292.43
11.53%
12.82%
1.91%
3215.28
1569.69
258.91
18.13%
8.95%
1.46%
11804.59
77.27%
11859.3
2
-----
66.88%
----
----
0.05
0.01%
0.01%
----
----
0.05
-----
51.74
1.10
5.92
96.81
0.34%
0.01%
0.04%
0.63%
85.67
1.07
3.53
106.56
0.58%
0.01%
0.01%
2.23%
Miscellaneous Assets:
Deferred Revenue
Expenditure
Investments
Profit & Loss a/c
Fixed Assets: (F.A)
Land-Free Hold
Land-Lease Hold
Railway Lines & Sidings
Roads, Bridges &
Culverts
Buildings
Plant & Machinery
Furniture & Fittings
Locomotives
Vehicles
Electrical Installations
Water Supply &
Sewerage systems
Miscellaneous Articles
Mining Lease Rights
Held For Disposal
Capital Work-in-progress
474.50
600.81
5.36
11.08
3.80
59.68
44.91
3.11%
3.93%
0.03%
0.07%
0.02%
0.39%
0.29%
448.5
468.36
6.12
9.69
4.80
54.63
31.78
2.64%
0.35%
0.05%
0.03%
0.05%
0.31%
0.18%
25.42
3.51
0.04
2087.19
0.17%
0.02%
0.01%
13.66%
32.32
3.22
0.05
4617.81
0.2%
0.02%
0.18%
26.04%
3471.92
22.73%
5874.16
33.12%
15276.51
100.00%
17733.48
100%
TOTAL ASSETS
[ C.A + F.A ]
Current Liabilities:
(C.L)
Sundry Creditors
Advances from
Customers
Other Advances
Earnest Money, Security
& Other Deposits
Interest Accured but not
Due
Other Liabilities
501.31
136.97
3.28%
0.90%
1149.44
137.46
6.5%
0.8%
1.57
99.32
0.01%
0.65%
1.43
137.87
0.1%
0.8%
4.89
0.03%
0.14
866.09
5.67%
1134.45
6.4%
Total Current
Liabilities
Long Term Liabilities
& Provisions: (L.T.M)
Provisions
Secured Loans
Unsecured Loans
Deferred Tax Liability
1610.15
10.54%
2560.79
14.45%
1581.47
332.78
107.95
163.12
10.35%
2.18%
0.71%
1.07%
1620.53
907.72
100.04
124.49
9.1%
5.1%
0.6%
0.7%
2185.32
14.31%
2752.78
15.52%
7827.32
3653.72
51.23%
23.92%
7827.32
4592.59
44.1%
25.9%
11481.04
75.15%
12419.91
70%
TOTAL LIABILITIES
[C.L + L.T.M + CAP. &
RES.]
15276.51
100.00%
17733.48
100%
0.01%
INTERPRETATION
In both the years the company has followed the policy of financing fixed
assets from long term funds. In the current year investments in fixed assets
are 22.73% while long term funds are 12.38% and these figures in previous
year is 33.12 and long term funds are 5.67% this shows that the company
in both the years have financed working capital from long term sources.
The working capital position of the company in both the years is good. In
the previous year the company has 77.27% of current assets while current
liabilities are of total investment. In the current year current assets
are66.88 % while current liabilities are 14.45%. The working capital of the
company in the year 2010 is much better than the year2010.
The analysis of various figures shows that the company for both the
TABLE NO 4.6
COMMON SIZE BALANCE SHEET OF VSP LTD. FOR THE YEARS
Particulars
2009
Amount
Percent
age
2009-2010
2010
Amount
Rs. Crs
Percent
age
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
Sundry Debtors
Stock (Inventories)
Loans & Advances
Other Current Assets
Total Current Assets
Miscellaneous Assets:
Deferred Revenue
Expenditure
Investments
Profit & Loss a/c
Fixed Assets: (F.A)
Land-Free Hold
Land-Lease Hold
Railway Lines & Sidings
Roads, Bridges &
Culverts
Buildings
Plant & Machinery
7194.68
216.80
1203.24
1518.90
314.48
55.98%
1.69%
9.36%
11.82%
2.45%
7699.11
93.41
1761.15
1958.49
292.43
50.40%
0.61%
11.53%
12.82%
1.91%
10448.10
81.30%
11804.59
77.27%
14.95
0.11%
----
----
0.05
0.01%
0.05
0.01%
----
----
----
----
51.74
1.16
10.25
82.39
0.40%
0.01%
0.08%
0.64%
51.74
1.10
5.92
96.81
0.34%
0.01%
0.04%
0.63%
522.43
926.29
4.06%
7.21%
474.50
600.81
3.11%
3.93%
3.95
16.21
1.96
73.49
68.54
0.03%
0.13%
0.02%
0.57%
0.53%
5.36
11.08
3.80
59.68
44.91
0.03%
0.07%
0.02%
0.39%
0.29%
28.15
3.90
---597.19
0.22%
0.03%
---4.65%
25.42
3.51
0.04
2087.19
0.17%
0.02%
0.01%
13.66%
2402.65
18.70%
3471.92
22.73%
12850.75
100.00%
15276.51
100.00%
365.83
119.91
2.85%
0.93%
501.31
136.97
3.28%
0.90%
2.02
82.54
0.02%
0.64%
1.57
99.32
0.01%
0.65%
18.41
0.14%
4.89
0.03%
422.82
3.29%
866.09
5.67%
Total Current
Liabilities
Long Term Liabilities
& Provisions: (L.T.M)
Provisions
Secured Loans
Unsecured Loans
Deferred Tax Liability
1011.53
7.87%
1610.15
10.54%
1092.77
604.45
312.51
291.29
8.50%
4.70%
2.44%
2.27%
1581.47
332.78
107.95
163.12
10.35%
2.18%
0.71%
1.07%
2301.02
17.91%
2185.32
14.31%
7827.32
1710.88
60.91%
13.31%
7827.32
3653.72
51.23%
23.92%
9538.20
74.22%
11481.04
75.15%
12850.75
100.00%
15276.51
100.00%
INTERPRETATION
In both the years the company has followed the policy of financing fixed
assets from long term funds. In the current year investments in fixed assets
are 18.58% while long term funds are 9.37% and these figures in previous
year is 22.72 and long term funds are 3.93% this shows that the company
in both the years have financed working capital from long term sources.
The working capital position of the company in both the years is good. In
the previous year the company has 81.41% of current assets while current
liabilities are 16.37% of total investment. In the current year current assets
are77.27 % while current liabilities are 21.48%. The working capital of the
company in the year 2010 is much better than the year2009.
The analysis of various figures shows that the company for both the years
has satisfactory long-term and short term financial position in comparisons
the previous year.
TABLE NO 4.7
COMMON SIZE BALANCE SHEET OF VSP LTD. FOR THE YEARS
Particulars
2008
Amount
2008-2009
Rs. Crs
Percent
2009
age
Amount
Percent
age
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
Sundry Debtors
Stock (Inventories)
Loans & Advances
Other Current Assets
5621.70
166.27
1218.35
1061.32
184.36
53.36%
1.58%
11.56%
10.07%
1.75%
7194.68
216.80
1203.24
1518.90
314.48
55.98%
1.69%
9.36%
11.82%
2.45%
8252.00
78.32%
10448.10
81.30%
Miscellaneous Assets:
Deferred Revenue
Expenditure
Investments
Profit & Loss a/c
24.87
0.24%
14.95
0.11%
0.00
0.00%
0.05
0.01%
0.00
0.00%
0.00
----
50.89
1.19
12.53
67.17
0.48%
0.01%
0.12%
0.64%
51.74
1.16
10.25
82.39
0.40%
0.01%
0.08%
0.64%
544.46
1179.46
3.68
19.20
1.72
85.51
73.71
5.17%
11.19%
0.03%
0.18%
0.02%
0.81%
0.70%
522.43
926.29
3.95
16.21
1.96
73.49
68.54
4.06%
7.21%
0.03%
0.13%
0.02%
0.57%
0.53%
34.56
4.18
0.01
180.73
0.33%
0.04%
0.00%
1.72%
28.15
3.90
0.00
597.19
0.22%
0.03%
---4.65%
2283.87
21.68%
2402.65
18.70%
10535.87
100%
12850.75
100.00%
275.04
120.19
2.61%
1.14%
365.83
119.91
2.85%
0.93%
1.60
68.89
0.01%
0.65%
2.02
82.54
0.02%
0.64%
TOTAL ASSETS
[ C.A + F.A ]
Current Liabilities:
(C.L)
Sundry Creditors
Advances from
Customers
Other Advances
Earnest Money,
8.43
0.08%
18.41
0.14%
311.62
2.96%
422.82
3.29%
785.77
7.45%
1011.53
7.87%
716.37
173.87
369.44
316.72
6.80%
1.65%
3.51%
3.01%
1092.77
604.45
312.51
291.29
8.50%
4.70%
2.44%
2.27%
1576.40
14.97%
2301.02
17.91%
7827.32
346.38
74.29%
3.29%
7827.32
1710.88
60.91%
13.31%
8173.70
77.58%
9538.20
74.22%
10535.87
100%
12850.75
100.00%
Total Current
Liabilities
Long Term Liabilities
& Provisions: (L.T.M)
Provisions
Secured Loans
Unsecured Loans
Deferred Tax Liability
TOTAL LIABILITIES
[C.L + L.T.M + CAP. &
RES.]
INTERPRETATION
During the year, i.e. 2009 the company is less traditionally financed as
compared to previous year. In 2009 the share capital consists of 74.21% of total
investment while the percentage is in previous year 77.58 %. The company has
relied less on shareholders fund in the current year.
In both the years the company has followed the policy of financing fixed assets
from long term funds. In the current year investments in fixed assets are
23.68% while long term funds are 11.4% and these figures in previous year is
18.58 and long term funds are 9.39 this shows that the company in both the
years have financed working capital from long term funds also.
The working capital position of the company in both the years is good. In the
current year the company has 76.31% of current assets while current liabilities
are 14.25% of total investment. In the year 2009 current assets are 86.42%
and current liabilities are 16.37%. The working capital of the company in the
year 2009 is much better than the year 2008.
The analysis of various figures shows that the company for both the years has
satisfactory long-term and short term financial position in comparisons the
previous year.
TABLE NO 4.8
COMMON SIZE BALANCE SHEET OF VSP LTD. FOR THE YEARS 2007-2008.
Particulars
ASSETS:
Current Assets: (C.A)
Cash & Bank Balances
Sundry Debtors
Stock (Inventories)
Loans & Advances
Other Current Assets
Total Current Assets
Miscellaneous Assets:
Deferred Revenue
Expenditure
Investments
Profit & Loss a/c
Fixed Assets: (F.A)
Land-Free Hold
Land-Lease Hold
Railway Lines & Sidings
Roads, Bridges &
Culverts
Buildings
Plant & Machinery
Furniture & Fittings
Locomotives
Vehicles
Electrical Installations
Water Supply &
Sewerage systems
2007
Amount
Percent
age
2008
Amount
Rs. Crs
Percent
Age
3932.61
49.30
1257.53
710.12
100.18
41.40%
0.52%
13.24%
7.48%
1.05%
5621.70
166.27
1218.35
1061.32
184.36
53.36%
1.58%
11.56%
10.07%
1.75%
6049.74
63.69%
8252.00
78.32%
43.01
0.45%
24.87
0.24%
0.00
0.00%
0.00
0.00%
905.99
9.54%
0.00
0.00%
51.71
1.22
14.80
62.84
0.54%
0.01%
0.16%
0.66%
50.89
1.19
12.53
67.17
0.48%
0.01%
0.12%
0.64%
568.88
1492.25
3.18
22.06
0.51
98.30
85.70
6.00%
15.71%
0.03%
0.23%
0.01%
1.03%
0.90%
544.46
1179.46
3.68
19.20
1.72
85.51
73.71
5.17%
11.19%
0.03%
0.18%
0.02%
0.81%
0.70%
Miscellaneous Articles
Mining Lease Rights
Held For Disposal
Capital Work-inprogress
35.39
4.46
0.00
58.85
0.37%
0.05%
0.00%
0.62%
34.56
4.18
0.01
180.73
0.33%
0.04%
0.00%
1.72%
3449.16
36.31%
2283.87
21.68%
TOTAL ASSETS
[ C.A + F.A ]
9498.90
100%
10535.87
100%
218.39
102.90
2.30%
1.08%
275.04
120.19
2.61%
1.14%
4.64
51.20
0.04%
0.54%
1.60
68.89
0.01%
0.65%
2.39
0.02%
8.43
0.08%
332.94
3.50%
311.62
2.96%
Total Current
Liabilities
Long Term Liabilities
& Provisions: (L.T.M)
Provisions
Secured Loans
Unsecured Loans
Deferred Tax Liability
712.46
7.50%
785.77
7.45%
269.27
88.94
442.42
158.49
2.83%
0.94%
4.66%
1.67%
716.37
173.87
369.44
316.72
6.80%
1.65%
3.51%
3.01%
959.12
10.10%
1576.40
14.97%
Current Liabilities:
(C.L)
Sundry Creditors
Advances from
Customers
Other Advances
Earnest Money,
Security & Other
Deposits
Interest Accured but
not Due
Other Liabilities
7827.32
0.00
82.40%
0.00%
7827.32
346.38
74.29%
3.29%
7827.32
82.40%
8173.70
77.58%
TOTAL LIABILITIES
[C.L + L.T.M + CAP. &
RES.]
9498.90
100%
10535.87
100%
INTERPRETATION
During the year, i.e. 2008 the company is less traditionally financed as
compared to previous year. In 2008 the share capital consists of 77.58% of
total investment while the percentage is in previous year 82.50%. The
company has relied less on shareholders fund in the current year. So
financial structure of current year is less safe as compare to previous year.
In both the years the company has followed the policy of financing fixed
assets from long term funds. In the current year investments in fixed assets
are 26.32% while long term funds are 7.34% and these figures in previous
year is 23.68 and long term funds are 11.4% this shows that the company
in both the years have capital from long term funds also. financed working
The working capital position of the company in both the years is good. In
the current year the company has 73.67% of current assets while current
liabilities are 10.33% of total investment. In the year 2008 current assets
are 76.31% and the current liabilities are 15.75%. the working capital of the
company in the year 2008 is much better than 2007.
The analysis of various figures shows that the company for both the
years has satisfactory long-term and short term financial position in
comparisons the previous year.
Particulars
2011
2010
2009
2008
2007
Sales
Cost of goods sold
Gross profit/loss
General, Admin & Selling
exp
Operating profit (EBIT)
Inters
Earnings Before Tax
(EBT)
TAX
Earnings After Tax (EAT)
9128
5312
3816
9088
4766
4322
7933
4269
3664
7306
6972
3343
7360
3927
3433
1706
1297
1397
976
1168
2110
88
3025
31
2267
48
2367
31
2265
11
2022
2994
2219
2336
2254
686
1336
1051
1943
856
1363
1085
1251
246
2008
TABLE NO 4.9
The Cost of goods Sold have been increased in the year of 2008 compared with
other years
The Gross Profit is also improved in2010 higher then other years
The General, Administrative & Selling Expenses are fluctuating during the
period 2007-2011.
The Operating profit has been immensely increased upto2007 to 2010, but
in2011 it was decreased
The EAT and Net Profit of the Firm is also high in
2007
compared with
reaming year.
TABLE NO 4.10
Particulars
Sales
Cost of goods sold
Gross profit/loss
General, Admin
&Selling exp
Operating profit (EBIT)
Inters
2011
9128
5312
3816
2010
9088
4766
4322
INCREASE/
AMOUNT
Rs.
+40
+546
-506
1706
2110
88
1297
3025
31
+409
-915
+57
DECREAS
E
PERCENT
AGE
+0.44
+11.45
-11.71
+31.53
-30.25
+183.87
2022
686
2994
1051
-972
-365
-32.46
-34.73
1336
1943
-607
-31.24
INTERPRETATION
In the above calculations we observe that while sales for the year 2011
increased by narmally0.44%, gross profit decreased by 11.71% only due to a
higher increased in cost of goods sold. In spite of an decreased in gross profit,
the net profit decreased by 31.24% due to higher operation expenses. While
general expenses admin expenses and selling expenses increased by 409crors
over the yea2010 ;this resulted in the decrease of net operating income or profit
there was a saving in the taxes by 365 crors since the rate remained the net
operating profit also decreased by the percentage namety32.73%
TABLE NO 4.11
2010
2009
INCREASE
AMOUNT Rs.
Sales
Cost of goods sold
Gross profit/loss
9088
4766
4322
7933
4269
3664
+1155
+497
+658
/DECREASE
PERCENTAGE
+14.56%
+11.64%
+17.95%
1297
3025
31
1397
2267
48
-100
+758
-17
-7.15%
+33.43%
-35.41%
2994
1051
1943
2219
856
1363
+775
+195
+580
+34.93%
+22.78%
+42.55%
INTERPRETATION
In the above calculations we observe that while sales for the year 2010
increased by normally 14.56%, gross profit increased by 17.95% only due to a
higher increased in cost of goods sold. In spite of an increased in gross profit,
the net profit increased by 42.55% due to higher operation expenses. While
general expenses admin expenses and selling expenses increased by 758crors
over the year 2009 ;this resulted in the increased of net operating income or
profit there was a saving in the taxes by 195crors since the rate remained the
net operating profit also increased by the percentage namety33.43%
TABLE NO 4.12
Particulars
2009
2008
Sales
Cost of goods sold
Gross profit/loss
General,Admin&Sellin
gexp
Operating
profit
(EBIT)
Inters
Earnings Before Tax
(EBT)
TAX
Earnings After Tax
(EAT)
7933
4269
3664
7306
6972
3343
1397
976
2267
48
INCREA
SE/ DECREASE
AMOUNT PERCENTAG
Rs.
E%
+627
+8.58
-2703
-38.76
+321
+9.6
+421
+43.13
2367
31
-100
+17
-4.22
+54.83
2219
856
2336
1085
-117
-229
-5.01
-21.1
1363
1251
+112
+8.95
INTERPRETATION
In the above calculations we observe that while sales for the year 2009
increased by normally 8.58%, gross profit increased by 9.6% only due to
decreased in cost of goods sold. In spite of an increased in gross profit, the net
profit increased by 8.95% due to operation expenses. While general expenses
admin expenses and selling expenses decreased by 421crors over the year 2008
;this resulted in the decreased of net operating income or profit there was a
saving in the taxes by 229crors since the
rate remained
TABLE NO 4.13
Particulars
Sales
Cost of goods sold
Gross profit/loss
General Admin&Selling
exp
Operating profit (EBIT)
Inters
Earnings Before Tax
(EBT)
TAX
Earnings After Tax
(EAT)
DECREAS
INCREASE/ E
AMOUNT
PERCENT
Rs.
AGE
-54
-0.73%
+3045
+77.54%
-90
-2.62%
2008
7306
6972
3343
2007
7360
3927
3433
976
2367
31
1168
2265
11
-192
+102
+20
-16.43%
+4.5%
+181.82%
2336
1085
2254
246
+82
+839
+3.64%
+341.06%
1251
2008
-757
-37.7%
INTERPRETATION
In the above calculations we observe that while sales for the year 2008
decreased by normally 0.73%, gross profit decreased by 2.62% only due to
increased in cost of goods sold. In spite of an decreased in gross profit, the net
profit decreased by 8.95% due to operation expenses. While general expenses
admin expenses and selling expenses increased by 421crors over the year 2007
;this resulted in the increased of net operating income or profit there was a
rate remained
FINDINGS
During the financial year 2011, the long-term liabilities were increased
by Rs 567.46 i.e.; 25.67% comparison to the previous year 2010.
During the financial year 2006, the long-term liabilities were decreased
by Rs 1084.25 i.e.; 84.84% comparison to the previous year 2005.
CONCLUSION
The Visakhapatnam Steel Plant has been dedicated to nation in
1992 and it is one of the major steel plants in the Asia and having much more
capital investment. We know that the Visakhapatnam Steel Plant as a large
organization might have long gestation period and while establishing the
Visakhapatnam Steel Plant so much of lands were taken from the local people
and provided the jobs to them in VSP thought they may not skillful. But the top
management of VSP conducts so many training and development programs to
improve their performance, not only this but also frequent technological
changes due to the above factors in the initial stage.
The VSP incurred some losses but with the remedial measures
taken by the top management the past scenario was changed and the
organization was stepped towards the profits and recorded 449.66 crores as a
profit for the year 2004. However the top management must take care to
improve the profitability and must try to reduce / remove the accumulated
losses, which is important for the wealth of the organization.
affairs of the
company RINL. It involved study of Balance sheet profit and loss account and
ratio analysis and also their comparison over the last five years, it has
presented a broader picture of the financial position of the company. The study
analyzed the companys success in being able to effectively manage its day to
day
requirements
pertaining
to
cash
and
funds
flow
and
effectively
channelizing the short term and long term funds of the company to meet the
requirements.
Production and
Sales Revenue has been satisfactory, the Company surrounded various adverse
situations during the past 25 years and has now been conferred the status of
Mini Ratna by now been conferred the status of Mini Ratna by Government of
India . The Companys plan to expand its capacity to 6.3 mtpa of liquid steel
has been approved by Government of India and the project is under progress.
SUGGESTIONS
The present level of the cash is Rs 7106 crores, this can be used in
expansion II in order to maintain the current ratio i.e., between current
assets and current liabilities at the optimum level.
The other main area where RINL has tremendous scope for improvement
is in manufacturing value added products.
BIBLIOGRAPY
FINANCIAL MANAGEMENT
- I.M.PANDEY
FINANCIAL MANAGEMENT
- PRASANNA
CHANDRA
- I.M.PANDEY
- S.P.JAIN,
K.L.NARANG,
SIMMI AGRAWAL,
MONICA SEHGAL
ADVANCED ACCOUNTANCY
R.L. Gupta
Volume- II
M. Radhaswamy
ANNEXURE
RASHTRIYA ISPAN NIGHAM LIMITAD
ANNUAL ACCOUNTS 2008-09
Schedules
As at
As at
31.march 2011
7827.32
7827.32
reserved surplus
4592.59
3653.72
secured loans
907.72
332.78
un secured loans
100.01
107.95
LOAN FUNDS
124.49
163.12
13552.13
12084.89
APPLICATION OF FUNDS
FIXED ASSETS
Gross block
9005.99
8006.83
less depreciation
7749.74
7516.19
net block
1256.25
1384.64
0.05
0.04
4617.81
2087.19
INVESTMENT
CURRENT ASSETS LOANS &
ADVENCES
Inventors
10
3215.28
1761.15
sundry debitors
11
191.27
93.41
12
6624.17
7699.11
CURRENT ASSETS
13
258.91
292.43
14
1569.69
1958.49
11859.32
11804.59
5874.11
3471.87
0.05
0.05
LESS CURRENT
&PROVISIONS
Liabilities
15
2560.79
1610.15
Provisions
16
1620.53
1581.47
4181.32
3191.62
7678.08
8612.97
13552.24
12084.89
Rs. Crs
As per 02rseparate report of even data
For RAO& KUMAR
Chartered accountants
(K.S. Shankar)
Director (finance)