MASCO

Spinning Mills (Pvt) Ltd.

Internship Report

Submitted By
Nigarish
(F2017045029)

In partial fulfillment
Of the requirement for the degree of
M.Com (Session 2017 - 19)

This Internship Report Submitted to

University of Management and Technology

 ACKNOWLEDGEMENT
All praise and thanks to “Allah Almighty”, The Most Merciful, The Most
Compassionate, Worthy of all praises, The Master of the Day of Judgment, Who
taught man what he did not know, whose blessings flourish my thoughts and enable
me to regard and respect His Last Messenger, “Hazrat Muhammad (S.A.W)”, Who
is forever a beacon of light and knowledge for humanity.

“He who is not thankful to people is not thankful to ALLAH”.

I want to express my heartily gratitude to my respectable Sir, “Sir Awais Shahbaz”,

for providing me necessary facilities. I am deeply thankful to him for his skills,
scholarly guidance, willingness and inspiring advice throughout the progress of my
research work. I pay special thanks to Sir Gulzar for his guidance throughout the
process, without which this task could not have been completed.
EXECUTIVE SUMMARY
 TABLE OF CONTENTS

INTRODUCTION ...............................................................................................................................................1
MASCO SPINNING MILLS..................................................................................................................................3
INTRODUCTION:...................................................................................................................................................... 3
VISION STATEMENT: ................................................................................................................................................ 3
MISSION STATEMENT: ............................................................................................................................................. 3
CORE CUSTOMER VALUE: ......................................................................................................................................... 4
THE PRODUCTS OF SPINNING: ................................................................................................................................... 4
ORGANIZATIONAL HIERARCHY: .......................................................................................................................7
EMPLOYEES AT MASCO: ......................................................................................................................................... 8
THE PRODUCT LINE ............................................................................................................................................ 9
Open-end Yarn. ............................................................................................................................................. 9
Ring Spinning Yarn: ..................................................................................................................................... 10
ACCOUNTS AND FINANCE DEPARTMENT .......................................................................................................11
SIGNIFICANT FINANCIAL POLICIES: ............................................................................................................................ 11
SIGNIFICANT ACCOUNTING POLICIES: ........................................................................................................................ 12
STAFF RETIREMENT BENEFITS ................................................................................................................................... 12
PROPERTY, PLANT AND EQUIPMENT .......................................................................................................................... 13
IMPAIRMENT:....................................................................................................................................................... 14
INTANGIBLE ASSETS: .............................................................................................................................................. 14
STORES, SPARE PARTS AND LOOSE TOOLS ................................................................................................................... 14
PROVISIONS: ........................................................................................................................................................ 15
TRADE DEBTS, LOANS, ADVANCES, TRADE DEPOSITS AND OTHER RECEIVABLES ................................................................... 16
REVENUE RECOGNITION: ........................................................................................................................................ 16
CASH AND CASH EQUIVALENTS ................................................................................................................................. 16
TAXATION: .......................................................................................................................................................... 16
TRADE DEPOSITS AND SHORT TERM PREPAYMENTS:...................................................................................................... 17
TRADE AND OTHER PAYABLES .................................................................................................................................. 17
FUNCTIONAL AND PRESENTATION CURRENCY .............................................................................................................. 17
FOREIGN CURRENCY TRANSACTIONS.......................................................................................................................... 17
FINANCIAL INSTRUMENTS ....................................................................................................................................... 18
LOANS AND RECEIVABLES ........................................................................................................................................ 18
AVAILABLE-FOR-SALE FINANCIAL ASSETS .................................................................................................................... 18
FINANCIAL LIABILITIES ............................................................................................................................................ 19
PRODUCTION OPERATIONS: ..........................................................................................................................21
MARKETING OPERATIONS .............................................................................................................................21
STRUCTURE OF MARKETING DEPARTMENT:................................................................................................................ 22
PRE - CONTRACT PHASE. ........................................................................................................................................ 24
POST - CONTRACT PHASE. ...................................................................................................................................... 24
CRITICAL ANALYSIS ........................................................................................................................................25
SWOT ANALYSIS: .............................................................................................................................................. 25
Strengths ..................................................................................................................................................... 25
Weaknesses ................................................................................................................................................. 25
Opportunities: ............................................................................................................................................. 26
Threats: ....................................................................................................................................................... 26
MY LEARNING AND RECOMMENDATIONS .....................................................................................................27
CONCLUSION .................................................................................................................................................29
Internship Report MASCO Spinning Mills

INTRODUCTION
When Pakistan came into being there was only 16 textile mills out of which only
12were in operation. It grew to 70 in 1957 as industrial development takes place. Now-
a-day there are 596-textile mills out of which 442 are in operation. The export revenue
of textile industry contributes a large share to the GDP of Pakistan.

Textile Exports from Pakistan:

Textiles constitute a major exporting sector for Pakistan, which accounts for about 60%
of the country’s total foreign exchange earnings. The major export items are yarn; gray
Cloth, finished cloth, towels and bed sheets and their major customers are the
USA, EU, Japan and Hong Kong. Many textile exports take place under quotaarrang
ements with the EU and the United States. Gray cloth constitutes roughly 16-18% of
total cloth.

In Pakistan, the cotton crop season runs approximately from AUGUST to MARCH
prices are generally high from the start August/September, and fall later on as
supply increases. Following income tax law, the fiscal year runs from October to
September for textiles sector.

The textile industry plays an important role in earning foreign exchange, providing
employment to the country. But with the ending of quota system in world, Pakistan
textile loses share in world trade of textile products. Pakistan textile products will
have a big potential to capture big share of world trade but there are lots of reasons
which forces to step back from using the full capacity of textile machinery to earn more
and more foreign exchange for the country.

In upcoming year, Pakistan textile exports are 10-11 billion US dollars approximately.
Government of Pakistan is not serious in resolving problems like shortage of
electricity and gas which forces the textile exporters not to take orders because not
fulfill the orders on time. With these reasons import of textile machinery declined year
on year basis. If Government of Pakistan does not take immediate steps to counter all
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these problems then Pakistan trade deficit will raise more as compared to FY09-10 due
to this Pakistan rupee will depreciate more.

Spinning is the strongest link of the value chain in Pakistan’s textile industry. It is the
oldest industry and has matured over years with considerable investment, human
resources and marketing connects globally to survive under most competitive
conditions. It has shown vigor and growth under a less sheltered environment
compared to India and China.

Textile Market Situation in Pakistan:

In Pakistani textile market the concept of a one-stop shop is not new as there are many
stores like Ideas, ChenOne and Habitt which are striving hard to provide their
customers with the ease and comfort of one-stop it. These stores are strong with their
brand names and recognition where they provide their customers with high quality
and design variations so as to make the element of uniqueness distinct in the
consumer’s mind.

Today’s consumer has evolved with a certain set of needs and demands which are
clearly defined in their minds and are more than capable in making purchasing
decisions where they evaluate each product feature to their mental scale and purchase
only if it rates higher in their perception.

However, there are a number of opportunities and challenges awaiting the textiles
and clothing industry of Pakistan in the international market place. For instance, it is
being expected that the importing countries would subsequently try to resort to other
trade restrictions to take the place of quotas. These can be in form of non-tariff barriers
such as importing countries’ requirements for the industry to comply with
environmental, labor, sanitary, phytosanitary or technical regulations. The
compliance to quality standards and regulations is a cost factor, which the industry
will have to face and prepare for. Moreover, countries like China and India have

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already began giving a tough competition to Pakistan’s industry under the present
quota free environment. A strategy needs to be made in this regard as well.
MASCO SPINNING MILLS
Introduction:
Masco Spinning Mills (Private) Limited is a private company limited by shares
incorporated in Pakistan on January 08, 2013 under the Companies Ordinance, 1984.
Registered Office of the Company is situated at 17-Km Multan Road, Lahore in the
province of Punjab. Mills is located at 46 kilometer, Multan road, District Kasur in
province of Punjab. Principal business of the Company is manufacturing and sale of
yarn.

The company works in accordance with approved accounting standards, as applicable

in Pakistan. Approved accounting standards comprise of International Financial
Reporting Standards issued by International Accounting Standards Board (IASB) and
adopted by the Institute of Chartered Accountants of Pakistan and provisions of and
directives issued under the Companies Ordinance, 1984. In case requirements differ,
the provisions or directives of the Companies Ordinance, 1984 shall prevail.

Standards, amendments and interpretations to the published standards that are not
yet notified by the Securities and Exchange Commission of Pakistan (SECP).

The following standards, amendments and interpretations with respect to the

approved accounting standards as applicable in Pakistan would are effective since
2018.

Vision Statement:
To transform the Company into a modern and dynamic yarn manufacturing
Company that is fully equipped to play a meaningful role on sustainable basis in the
economy of Pakistan

Mission Statement:

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The mission statement of MASCO Spinning Mills Ltd. is: "Quality with consistency
through excellence in application of requisite techniques and optimized utilization of
available resources for the maximization of profits".
Core Customer Value:
''This is the more basic level which addresses the question “what is the customer really
wants to buy?”

When designing products marketer must define the core problem solving benefits or
services that customer seeks. Similarly, MASCO does not compromise on quality and
tries to provide its customer with the best quality items.

The Products of Spinning:

A Yarn is usually of substantial length & of small cross section. In the cross section of
a yarn there are usually a multiple number of Staple fibers (short fibers) or Filaments
(long fibers) of unlimited length.

Yarn made out of Staple fiber is known as Spun Yarn, because the staple fibers should
undergo number of process stages so that a yarn can be made out of them. This
procedure or process stages in correct sequence is called “Spinning”. Fiber extrusion
or conversion of filaments from Polymers was also considered as “Spinning”. Below
mentioned is an introduction to the Yarns.

Staple Spun Yarn:

Those are made by Twisting Staple Fibres together into a Strand. The length of the
Fibre is limited. Some of the categories of spun yarn that are used are written below
in the list.

01. Mono Yarn:

Solid, Single Strand of Unlimited Length.

02. Multi Filament:

Many continuous filaments with some twist.

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03. Staple Yarn:

Many short fibers twisted together tightly.

04. Two Plied Yarn:

Two single yarn twisted together.

05. Multi Plied Yarn:

Plied Yarns twisted together.

06. Thread:
Hard, Fine, Plied Yarn.

07. Cord or Cable:

Many plied yarns twisted into a course structure.

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Cotton Yarn Manufacturing Process:

In here we have discussed the process of cotton yarn manufacturing. The Initial stage
of the Spinning Process involves converting Cotton in Bales into the Cone Winding.

Below mentioned is how the Man-made Fibers manufacturing Process.

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Bale Opening
↓
Conditioning of MMF Fibers
↓
Blending
↓
Blow Room
↓
Carding
↓
Drawing 1
↓
Drawing 2 (with Auto Leveler)
↓
Speed Frame
↓
Ring Frame
↓
Cone Winding

First thing in Spinning Process is converting highly compressed Cotton in Bales into
the form of thoroughly loosened, opened & cleaned State.

These Steps of processing are carried out in the Blow Room of a Spinning Mill. First
stage of Spinning involves converting lightly compressed Cotton bales into the form
of Opened & Cleaned Fibre Flocks.

Organizational Hierarchy:

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Managerial hierarchy at MASCO can be defined as a system of grades of Authority or

status from lowest to the highest. In generic terms, looking at the only the level of
management, the hierarchy can be understood with the help of the following.

Chairman

Managing Director (MD)

Executive Director (ED)

Director (Administration/Finance/Merchandising)

General Manager (Production/Quality)

M
Manager (Production/Quality/ Merchandising)

M
Assistant Manager (Production/ Quality/ Merchandising)

M
Line Chief (LC)

M
Supervisors & Inspectors

M
Operators & Worker

This hierarchy is started from grade number 1 and end at grades number 10, where
chairman is in top level and operator & worker are in lowest level.

So, it is important to ensure all contribution in production process that are directly or
indirectly involve with the production process.

Employees at MASCO:

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SSM has 925 employees in which 220 are contractual and 705 are permanent
employees. The permanent employees shall be classified under the following
categories;
a) Officers; covering all classes of employees from pay group V and above
including employees in special pay groups.
b) Staff; covering all areas of employees in pay group 1 to 1V.

THE PRODUCT LINE

The product of the SSM consists into two main sections and the objective in these two
sections is to produce the yarn finished goods product by using the cotton as raw
material. These two sections are as under.
A. Open-end yarn.
B. Ring Spinning Yarn.

Open-end Yarn.
Open end yarn consists into two main Categories that are as follows. These two
catogeries are produce by cotton and soft waste.

 Open-end Soft yarn.

This type of yarn is produced with B grade cotton and with the mixing soft
waste using. Mostly this type product sells into local market only. Currently
these counts are running in this category.
 5/1 soft in local packing.
 7/1 soft in local packing.
 8/1 soft in local packing.
 Open-end hard yarn.
This category of yarn is produced by using of A+ grade cotton and no any
mixing of soft waste in it. Mostly the product is prepared for sell into the
foreign market.Now these counts are running in this category.
 10/1 hard in export packing.
 12/1 hard in export packing.

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 22/1 hard in local and export packing.

Ring Spinning Yarn:

Ring spinning yarn is produced mostly for export and it is produced with the use of
100% Local and Important cotton of A+ grade. It is divided into 4 catogeries.
 Ring spinning carded hosiery yarn.
 Ring spinning comber hosiery yarn.
 Ring spinning Lycra yarn.
 Ring spinning slub yarn.

Ring Spinning Carded hosiery yarn.

This category consists in following counts.
 20/1 carded hosiery in local and export packing.
 22/1 carded hosiery in export packing.

Ring Spinning Comber Hosiery yarn;

This category consists on following counts.  18/1 comber in local packing.
 20/1 comber in local packing.
 26/1 comber in export packing.
 30/1 comber in export packing.

Ring Spinning Lycra Yarn;

This category is use for making socks especially. This category consists in
following counts.
 12/1 Lycra in export packing
 16/1 Lycra in local packing.
Ring Spinning Slub Yarn;
This is that product of yarn that is use for making winter season cloth. Currently
only one counts are running in this category.
 8/1 slub in local packing.

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ACCOUNTS AND FINANCE DEPARTMENT

Significant Financial Policies:
The preparation of financial statements in conformity with approved accounting
standards, as applicable in Pakistan, requires the use of certain critical accounting
estimates. It also requires the management to exercise its judgment in the process of
applying the Company's accounting policies. Estimates and judgments are
continually evaluated and are based on historical experience, including expectation of
future events that are believed to be reasonable under the circumstances. The areas
where various assumptions and estimates are significant to the Company's financial
statements or where judgments were exercised in application of accounting policies
are discussed below:

Assumptions and estimates used in determining the recoverable amount, residual

values and useful lives of property, plant and equipment;

Assumptions and estimates used in determining the useful lives and residual values
of intangibles assets;

Assumptions and estimates used in calculating the provision for impairment for
trade debts;

Assumptions and estimates used in determining fair value of available-for-sale

investment;

Assumptions and estimates used in the recognition of income taxes; and

Assumptions and estimates used in disclosure and assessment of provision for

contingencies.

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Significant Accounting Policies:

The preparation of financial statements in conformity with approved accounting standards
requires the use of certain critical accounting estimates. It also requires the management to
exercise its judgment in the process of applying the Company's accounting policies. Estimates
and judgments are continually evaluated and are based on historical experience, including
expectation of future events that are believed to be reasonable under the circumstances. The
areas where various assumptions and estimates are significant to the Company's financial
statements or where judgments were exercised in application of accounting policies are
discussed below.

Assumptions and estimates used in determining the recoverable amount, residual values and
useful lives of property, plant and equipment;

Assumptions and estimates used in writing down items of stock in trade and stores, spare
parts and loose tools to their net realizable value;

Assumptions and estimates used in calculating the provision for impairment for trade debts,
loans, advances, trade deposits and other receivables;

Assumptions and estimates used in the recognition of income taxes;

Assumptions and estimates used in calculating provision for gratuity; and

Assumptions and estimates used in disclosure and assessment of provision for contingencies.

Staff retirement benefits

The Company operates an unfunded gratuity scheme for its eligible staff under
which benefits are paid on cessation of the employment subject to minimum
qualifying period of service. i.e. one year. Provision is made annually to cover the
obligation on the basis of actuarial valuation and charged to income currently.

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Acturial gain/losses are recognized in statement of comprehensive income.

'Principal actuarial assumptions used in the actuarial valuation carried out as at June
30 are as follows:

Discount rate used for year end obligation 7.75% (2016:7.25%) per annum
Mortality rates are based on State Life Corporation (SLIC) 2001 – 2005 ultimate
mortality rates with 1 year setback as per recommendation of Pakistan Society of
Actuaries (“PSOA”).

Property, plant and equipment

Property, plant and equipment are initially recognized at acquisition cost, including
any costs directly attributable to bringing the assets to the location and condition
necessary for it to be capable of operating in the manner intended by the Company’s
management.

Subsequently, property and equipment are measured using cost model at cost less
subsequent accumulated depreciation and impairment losses, if any. Freehold land
is stated at cost amount.

Depreciation is charged to income statement using reducing balance method, so as

to write off the depreciable amount of assets over their estimated useful lives at the
rates given in note 4 . Depreciation on additions is charged from the month in which
the assets is available for use and on disposals up to the preceding month of
disposal.

Gain / loss on disposal of property, plant and equipment is reflected in the income
during the period in which they are incurred. Normal repairs and maintenance are
charged to income as and when incurred. Major renewals and improvements are
capitalized.

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The asset's residual values and estimated useful lives are reviewed as required, but
at least annually whether or not the asset is revalued and adjusted if impact on
depreciation is significant.

Impairment:
The Company assesses at each balance sheet date whether there is any indication
that assets may be impaired. If such indication exists, the carrying amount of such
assets are reviewed to assess whether they are recorded in excess of their recoverable
amounts. Where carrying values exceed recoverable amounts, assets are written
down to their recoverable amounts and the differences are recognized in income
currently.

Intangible Assets:
An intangible asset is an identifiable non-monetary asset without physical substance.
Intangible assets are recognized when it is probable that the expected future
economic benefits will flow to the entity and the cost of the assets can be measured
reliably. Cost of the intangible asset includes purchase cost and directly attributable
expenses incidental to bring the asset for its intended use.
Costs associated with maintaining computer software are recognized as an expense
as and when incurred.

Intangible assets are stated at cost less accumulated amortization and accumulated
impairment losses, if any. Amortization is charged over the estimated useful life of
the asset on a systematic basis applying the straight line method.

Useful lives of intangible assets are reviewed at each balance sheet date and adjusted
if the impact of amortization is significant.

Stores, spare parts and loose tools

These are valued at lower of cost using moving average method and net realizable
value except goods in transit which are stated at cost.

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Provisions:
Provisions are made in the balance sheet when the Company has legal or
constructive obligation as a result of past event, and it is probable that outflow of
economic resources will be required to settle the obligation. However, provisions are
provided at each balance sheet date and adjusted to reflect current best estimate.

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Trade debts, loans, advances, trade deposits and other receivables

Trade debts, loans, advances, trade deposits and other receivables are measured at
fair value of consideration received or receivable less an estimate made for doubtful
receivables, if any based on a review of all outstanding amounts at the year end. Bad
debts are written off as and when identified.

Trade debts, loans, advances, trade deposits and other receivables are assessed for
indicators of impairment at each balance sheet date. Trade debts, loans, advances,
trade deposits and other receivables are considered to be impaired when there is
objective evidence that, as a result of one or more events that occurred after the
initial recognition, the estimated future cash flows of the asset have been affected.

Revenue Recognition:
Sales are recorded on dispatch of goods to customers.

Interest income is recognized when it is probable that the economic benefits will
flow to the Company and the amount of income can be estimated reliably. Interest
income is accrued on a time basis, by reference to the principal balance outstanding
and at the interest rate applicable.

Cash and cash equivalents

For the purpose of cash flow statement, cash and cash equivalents comprise cash in
hand and bank balances and other short term highly liquid investments that are
readily convertible to known amounts of cash and which are subject to an
insignificant risk of change in value.

Taxation:
Current: Provision for current taxation is based on taxable income at the current
rates of taxation after considering rebates and tax credits available, if any.

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Deferred tax: Deferred tax is provided using the balance sheet liability method for all
temporary differences at the balance sheet date between tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax asset is recognized for all deductible temporary differences and
carry forward of unused tax losses and tax credits, if any, to the extent that it is
probable that taxable profits will be available against which such temporary
differences and tax losses/credits can be utilized. Deferred tax liabilities are
recognized for all major taxable temporary differences.

Deferred income tax assets and liabilities are measured at the tax rates that are
expected to apply to the period when the asset is realized or the liability is settled,
based on tax rates that have been enacted or substantively enacted at the balance
sheet date. Deferred tax is charged or credited to the income statement, except in the
case of items credited or charged to equity in which case it is included in equity.

Trade deposits and short term prepayments:

Trade deposits and short term prepayments are carried at original invoice amount
less an estimate made for doubtful receivables based on review of outstanding
amounts at period end. Balances considered bad and irrecoverable are written off
when identified.

Trade and other payables

Liabilities for trade and other payables are carried at their cost which is the fair value
of the consideration to be paid in the future for goods and services received whether
billed to the Company or not.

Functional and presentation currency

These financial statements are presented in Pak Rupees which is the Company's
functional and presentation currency. Figures have been rounded off to the nearest
rupee in these financial statements.

Foreign currency transactions

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Transactions in foreign currency are recorded in Pak Rupee at the rate of exchange
prevailing on the transaction date. All the monetary assets and liabilities in foreign
currencies are translated at exchange rates prevailing on the balance sheet date.
Exchange differences are dealt with through income statement. Gains and losses
arising on translation are included in profit or loss for the period.

Financial instruments
Financial assets are recognized when the Company becomes a party to the
contractual provisions of the financial instrument and are measured initially at fair
value adjusted by transaction costs. Subsequent measurement of financial assets are
described below. Financial assets are derecognized when the contractual rights to
the cash flows from the financial asset expire, or when the financial asset and all
substantial risks and rewards are transferred.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. After initial recognition, these are
measured at amortized cost using the effective interest method, less provision for
impairment. Discounting is omitted where the effect of discounting is immaterial.
These are included in current assets, except for maturities for greater than twelve
months after the balance sheet date, which are classified as non-current assets. Loans
and receivables with less than twelve months maturities are classified as current
assets. The Company's cash and cash equivalents, trade debts, loans and advances,
deposits and other receivables fall into this category of financial instruments. Loans
and receivables are subject to review for impairment at each reporting date to
identify whether there is objective evidence that the financial asset is impaired.

Available-for-sale financial assets

Available for sale financial assets are non-derivatives that are either designated in
this category or not classified in any of the categories of loans and receivables,
financial assets at fair value through profit or loss and financial assets held to

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maturity. They are included in non-current assets unless management intends to

dispose of the investments within twelve months from the end of reporting period.

After initial recognition, available- for-sale investments are measured at fair value in
accordance with IAS 39 "Financial Instruments: Recognition and Measurement".
Gains or losses on available-for-sale investments are recognized through other
comprehensive income until the investment is sold or de-recognized, at which time
the cumulative gain or loss previously reported is included in profit or loss.

Dividends on available-for-sale equity instruments are recognized in the profit or

loss when the Company's right to receive payments is established.

Financial assets are derecognized when the rights to receive cash flows from the
assets have expired or have been transferred and the Company has transferred
substantially all risks and rewards of ownership.

The Company assesses at each balance sheet date whether there is objective
evidence, that a financial asset or group of financial assets is impaired. If any such
evidence exists for 'available-for-sale' financial assets, the cumulative loss is removed
from equity and recognized in profit or loss. Impairment losses recognized in profit
or loss on equity instruments are not reversed through profit and loss account.

Financial liabilities
The Company's financial liabilities include borrowings and trade and other
payables.

All financial liabilities are recognized at the time when the Company becomes a
party to the contractual provisions of the instrument.

Financial liabilities are measured initially at fair value, less attributable transaction
costs. Financial liabilities are measured subsequently at amortized cost using the

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effective interest method, in accordance with International Accounting Standard 39,

Financial Instruments: Recognition and Measurement.

A financial liability is derecognized when the obligation under the liability is

discharged or cancelled or expired. Where an existing financial liability is replaced
by another from the same the lender on substantially different terms, or terms of an
existing liability are substantially modified, such an exchange and modification is
treated as a derecognition of original liability and the recognition of new liability,
and the difference in respective carrying amounts is recognized in the profit and loss
account.

Borrowing costs directly attributable to the acquisition, construction or production

of qualifying assets, if any, are added to the cost of those assets, until such time as
the assets are substantially ready for their intended use or sale. Investment income
earned on the temporary investment of specific borrowings, if any, pending their
expenditure on qualifying asset is deducted from the borrowing costs eligible for
capitalization. All other borrowing costs are recognized as expense in the period in
which they are incurred.

A financial asset and financial liability is offset and the net amount is reported in the
balance sheet if the Company has a legal enforceable right to set off the transaction
and also intends either to settle on a net basis or to realize the asset and settle the
liability simultaneously.

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PRODUCTION OPERATIONS:

MARKETING OPERATIONS
The MASCO Marketing Operations consists of the customer’s needs and
requirements. They keep in mind the needs of the customers and the satisfaction of
the customers while launching any new product or while making new policy or the
strategies. All their planning of product or planning of quality or planning of packing
or on the basis of their customer’s needs. While selecting new sector management
considers the following.

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a- How many Counts we can manage:-

It is very big issue for the management of the MASCO when they have to manage for
a new yarn counts. Because they have already full frames that are manufacturing yarn
for their buyers. So for matter they have to think and they have to make policy to
manage new order. In this connection management think and make a policy to handle
it.

b-What are other competitors doing;

The most important challenge for the management of MASCO is that they have to see
from other competitors. They visit and see the problem they are facing. If the problem
is launching new product ,problem of getting new contract from the buyer or getting
of new product contract from old customers.

c- While launching new product of yarn;

This is very big and serious matter for the management of the MASCO when they
have got a new contract from the customers for a new product. To complete this
contract MASCO has to make a policy for old contract and to complete. It depends on
management that they delay in the local customers or they stop any extra production
of yarn that have in special times to launch new product. So the management makes
such a production plan in which whole the matter handled with that production plan
and that production policy.

d-Corporate clients visiting.

MASCO Marketing Department evaluates the corporate the customers and then visit
on prior basis to create a positive image in the minds of business people. Through this
Marketing Department also evaluate the product image of yarn. Details of domestic
as well as international marketing operations of MASCO are as under:

Structure of Marketing Department:

Significance of marketing department for an organization is like its soul. Because this
department puts all of its efforts to increase the sales of the organization. MASCO is
a company that has an energetic Marketing department. All people working here are
aggressive and action oriented. Marketing department is responsible for that how
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product is distributed and prompted and priced. Basically the concentration of

marketing department is on customer needs.

Hierarchy of the department is as follows.

Marketing team is considered as assets for any factor who nourishes it through getting
continuous orders. This department is responsible for negotiating with the buyer,
developing and getting approval about lab dips, fabric and samples from the buyer
and forwarding buyer requirements/specifications production planning department,
so that an order can get delivered on time with all specialization and quality
parameters required by the buyers.

The Marketing Manager is head of Marketing Department. The following sections

come under it and they work in close association with the marketing department.
 Customer contract Pre/Post contract activities.
 Sample Development.

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The business process is a set of activities to perform business dealing with customers.
The business dealing can be done through different ways. The following are the
sources to contact with customers are as under.

Through the agent of the foreign buyer.

 Direct contacts.
 New customer’s inquires.

The business process has two phases:

1. Pre- Contract Phase.
2. Post-Contract Phase.

Pre - Contract Phase.

In Pre- Contract phase inquiries are made by customer for information, price
quotation from supplier. If the customer satisfies from the price quote by the supplier
then the customer places a purchase order regarding the required quantity and quality
of the product (Yarn). The supplier prepare a contract note against the purchase order
of customer.

Pre-Contract phase includes the following:

 Inquiry from customer.
 Price Quote from Supplier.
 Purchase order from customer.
 Contract note from supplier.

Post - Contract Phase.

When the pre-contract phase end then post contract phase start. In post contract phase
production order is prepared against contract note. The set of activities which process
the contract into the production to the production department. Then handling the
shipping documents after opening the Letter of credit. At last shipment reach to the

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destination and contract come to an end. These business/marketing prices repeat

again and again.
The post contract phase consists of the following steps as under:
 Production order.
 Letter of credit.
 E-Form.
 Shipment and shipping documents.

CRITICAL ANALYSIS
I have gained the practical exposure in a real working environment. Working
specifically in accounts and finance, a lot of practical work has given me more
exposure and has built on my knowledge that was gained in class room settings
during the degree.

SWOT ANALYSIS:
Internal Environment Analyses
Internal Environment Analysis includes strength and weakness within MASCO,
which are explained below.
Strengths
 Export- oriented organizations.
 Highly skilled labor.
 Qualified finance staff.
 Professionalism in the employees.
 Corporate culture.
 Sound policies.
 Leads towards Paperless organization.
 Availability of raw material at cheaper rate.
 Products are technology competitive.
 Customer orientation.
 Efficient production system.

Weaknesses
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 Work over load on staff.

 Too much centralized operation.
 Excessive emphasis on cost effectiveness.
External Environment Analyses
Internal Environment Analysis includes opportunities and threats within MASCO,
which are explained below.

Opportunities:
 Rapidly growing industry.
 Increasing government incentives for exports sector.
 Enter new markets or segments.
 Computer technology improvement

Threats:
 Intensive competition..
 Child labor propaganda.
 Political instability in Pakistan.
 Globalization.
 Labour law modification.
 FBR and Taxation Matters.

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MY LEARNING AND RECOMMENDATIONS

Although it is quite difficult to suggest some thing to such an established organization
but I put my efforts to suggest in the following lines:

 There is lack of information literature about the MASCO (PVT) Limited. There
is no informative book or material for new comers or internees and it is very
difficult for internees to get accurate and complete information.

 They can more enhance the image of their company by entering into the field of
public relations. If they let the public know their plans and operations, it can be
hoped that the people will consider the organization with a sense of still greater
esteem and this can add to the growth of their consumer products.

 There is lack of motivation in to Industrial Marketing Department. The Sales

Officers are not so motivated as it should be. In fact, they have little interest in
getting new customers. For this, I think some sort of benefits should be given to
the Sales officers.

 I found during my internship program that there is no person in MASCO PVT

Limited to give the orientation to the new internees. Internees learn during their
work.

 As the training procedures are also very important to have qualitative people
on their job, special emphasis should be laid on to the management
development part of the training programs.

 Complaints regarding Customer Services and other problems should be solving

after to know whole the problem and reason of that problem and also as well as
to know about responsible person of that complaint on prior bases to avoid hard
image.

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 The Company must improve production efficiency through increased

automation, re-engineering of system, backward and forward integration of
operations, moving up the value chain

 They should active participate in regain textile exhibitions like one that will take
place in Dubai. In which leading manufacturers and decision makers will
participate from south Asia, and the middle east.

 They should adopt proactive approach in order to avoid complaints, delays and
problems.

 Directors of the firm should delegate signing authorities for routine documents
to Chief Financial Officer or Manager Accounts and GM finance, like signing
cheques upon specific limit so that finance matters can handled easily and on
time by finance officials

 I also observe that some times a lot of confusion is created due to complicated
procedures. So try to adopt simplicity in the documentation and by resolving
the communication gap with the other departments

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CONCLUSION
This internship is proved to be very helpful for me. I got a lot of knowledge and also
the practical aspect of the life. It is my first experience which is obviously very tough
but it will be very beneficial for us in the future.

During my internship at MASCO, I conclude that it is an excellent organization.

Apart from its excellent operations, it does not tend to be stationary at one point. The
Top Management keeps on exploring the profitable opportunities and the
organization keeps on growing.

I think the future prospects of the MASCO Limited are quite bright. It will grow and
advance more and more with time. At the end I would like to express my thanks to
the Accounts, Finance, and Marketing departments for giving time and sharing
valuable information. This information gave me good understanding of some basic
concept being practiced.

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