Final Report - Jayanthi

CHAPTER – I
INTRODUCTION
1.1 INTRODUCTION:
In our present day economy, finance is defined as the provision of money at the time
when it is required. Every enterprise, whether big, medium of small, needs finance to
carry its operations and to achieve its targets. In fact, finance is so indispensable today
that it is rightly said to be the lifeblood of an enterprise. Without adequate finance, no
enterprise can possibly accomplish its objectives.
Financial management is applicable to every type of organization, irrespective of its size

kind of nature. It is as useful to a small concern as to a big unit. A trading concern gets
the same utility from its application as a manufacturing unit may expect. This subject is
important and useful for all types of ownership organizations. Where there is a use of
finance. Financial management is helpful. Every management aims to utilize its funds in
a best possible and profitable way. So this subject is acquiring a universal applicability.
Financial performance analysis is largely a study of relationship among the various

financial factors in a business as disclosed by a single set of statements and statements. It
is a process of evaluating the relationship between component parts of a financial
statement to obtain a better understanding of a firm's position and performance.
Financial performance analysis is an attempt to determine the significance and meaning

of the financial statement data so that forecast may be made of the future earnings, ability
to pay interest and debt maturities a (both current and long term) and profitability of a
sound policy.
A number of methods or devices are used for the analysis the balance sheet and income
statements of the Indian Overseas of for a period of 5 years (2006-2010). The analysis
was done by using various financial tools, statistical tools. The graphs were used
accordingly to support the analysis.
1.2 INDUSTRY PROFILE
OVERVIEW:
India has a strong and vibrant banking sector comprising state-owned Banks, private
sector Banks, foreign Banks, financial institutions and regional Banks including
cooperative Banks, rural Banks and local area Banks. In addition there are non-banking
financial companies (NBFCs), housing finance companies, Nidhi companies and chit
fund companies which play the role of financial intermediaries.
Without a sound and effective banking system in India it cannot have a healthy economy.
The banking system of India should not only be hassle free but it should be able to meet
new challenges posed by the technology and any other external and internal factors.
For the past three decades India's banking system has several outstanding achievements
to its credit. The most striking is its extensive reach. It is no longer confined to only
metropolitans or cosmopolitans in India. In fact, Indian banking system has reached even
to the remote corners of the country. This is one of the main reasons of India's growth
process.
The government's regular policy for Indian bank since 1969 has paid rich dividends with
the nationalization of 14 major private Banks of India.
The first bank in India, though conservative, was established in 1786. From 1786 till
today, the journey of Indian Banking System can be segregated into three distinct phases.
They are as mentioned below:
• Early phase from 1786 to 1969 of Indian Banks

• Nationalization of Indian Banks and up to 1991 prior to Indian banking sector
Reform
• New phase of Indian Banking System with the advent of Indian Financial &
Banking Sector Reforms after 1991
Phase I:
The General Bank of India was set up in the year 1786. Next came Bank of Hindustan
and Bengal Bank. The East India Company established Bank of Bengal (1809), Bank of
Bombay (1840) and Bank of Madras (1843) as independent units and called it Presidency
Banks. These three Banks were amalgamated in 1920 and Imperial Bank of India was
established which started as private shareholders Banks, mostly Europeans shareholders.
During the first phase the growth was very slow and Banks also experienced periodic
failures between 1913 and 1948. There were approximately 1100 Banks, mostly small.
To streamline the functioning and activities of commercial Banks, the Government of
India came up with The Banking Companies Act, 1949 which was later changed to
Banking Regulation Act 1949 as per amending Act of 1965 (Act No. 23 of 1965).
Reserve Bank of India was vested with extensive powers for the supervision of banking
in India as the
Central Banking Authority:During those days public has lesser confidence in the
Banks. As an aftermath deposit mobilization was slow. Abreast of it the savings bank
facility provided by the Postal department was comparatively safer. Moreover, funds
were largely given to traders.
Phase II:
Government took major steps in this Indian Banking Sector Reform after independence.
In 1955, it nationalized Imperial Bank of India with extensive banking facilities on a
large scale specially in rural and semi-urban areas. It formed State Bank of India to act as
the principal agent of RBI and to handle banking transactions of the Union and State
Governments all over the country.
It was the effort of the then Prime Minister of India, Mrs. Indira Gandhi. 14 major
commercial Banks in the country were nationalized.
Phase III:
This phase has introduced many more products and facilities in the banking sector in its
reforms measure. In 1991, under the chairmanship of M Narasimham, a committee was
set up by his name which worked for the liberalization of banking practices.
The country is flooded with foreign Banks and their ATM stations. Efforts are being put
to give a satisfactory service to customers. Phone banking and net banking is introduced.
The entire system became more convenient and swift. Time is given more importance
than money.
The financial system of India has shown a great deal of resilience. It is sheltered from any
crisis triggered by any external macroeconomics shock as other East Asian Countries
suffered. This is all due to a flexible exchange rate regime, the foreign reserves are high,
the capital account is not yet fully convertible, and Banks and their customers have
limited foreign exchange exposure.
Indian banking sector comprising state-owned Banks, private sector Banks, foreign
Banks, financial institutions and regional Banks including cooperative Banks, rural Banks
and local area Banks.
State-owned Banks:
The Indian banking sector is dominated by 28 state-owned Banks which operate through
a network of about 50,000 branches and 13,000 ATMs. The State Bank of India (SBI) in
the largest bank in the country and along with its seven associate Banks has an asset base
of about Rs. 7,000 billion (approximately US$150 billion). The other large public sector
Banks are Punjab National Bank, Canara Bank, Bank of Baroda, Bank of India and IDBI
Bank.
The public sector Banks have overseas operations with Bank of Baroda topping the list
with 51 branches, subsidiaries, joint ventures and representative offices outside India,
followed by SBI (45 overseas branches/offices) and Bank of India (26 overseas
branches/offices). Indian Banks, including private sector Banks, have 171
branches/offices abroad.
SBI is present in 29 countries followed by Bank of Baroda (20 countries) and Bank of
India (14 countries).
Private sector Banks India has 29 private sector Banks including nine new Banks which
were granted licences after the government liberalized the banking sector. Some of the
well known private sector Banks are ICICI Bank, HDFC Bank and IndusInd Bank. Yes
Bank is the latest entrant to the private sector banking industry.
In terms of reach the private sector Banks with an asset of over Rs 5,700 billion (about
US$124 billion) operate through a network of 6,500 branches and over 7,500 ATMs.
Foreign Banks As many as 29 foreign Banks originating from 19 countries are operating
in India through a network of 258 branches and about 900 ATMs. With total assets of
more than Rs 2,000 billion (about 44 billion US dollars) they are present in 40 centers
across 19 Indian states and Union Territories. Some of the leading international Banks
that are doing brisk business in India include Standard Chartered Bank, HSBC Bank,
Citibank N.A. and ABN-AMRO Bank. In addition, 31 foreign Banks (as on September
15, 2006) belonging to 14 countries were operating in India through their representative
offices.
Regional Banks:
Rural areas in India are served through a network of Regional Rural Banks (RRBs),
urban cooperative Banks, rural cooperative credit institutions and local area Banks. Many
of these Banks are not doing well financially and the government is currently engaged in
restructuring and consolidating them. Local area Banks were of recent origin and as on
March 31, 2006 four such Banks were operating in the country.
Financial institutions India has seven major state-owned financial institutions which
include Industrial Development Bank of India (IDBI), Industrial and Financial
Corporation of India (IFCI), Tourism Finance Corporation of India (TFCI), Exim Bank,
Small Industries Development Bank of India (SIDBI), National Bank for Agriculture and
Rural Development (NABARD) and National Housing Bank (NHB). These institutions
provide term loans and arrange refinance. There are also specialised institutions like the
Power Finance Corporation (PFC), Indian Railway Finance Corporation (IRFC),
Infrastructure Development Finance Company (IDFC) and state-level financial
corporations. Non-banking financial companies
Recent developments:
State Bank of India has acquired 76 per cent stake in Giro Commercial Bank, a Kenyan
bank for US$7 million.
Bank of Baroda is planning to acquire a bank in Africa to consolidate its presence in the
continent.
Canara Bank is helping Chinese Banks recover their huge non-performing assets (NPA).
ICICI bank is in the process of taking over Sangli Bank, a private sector bank based in
Maharashtra.
The RBI has recently allowed the Commonwealth Bank of Australia, Banche Popolari
unite S.c.r.l. (based in Italy), Vneshtorgbank (Russian trade bank), Promsvyazbank
(Russian commercial bank), Banca Popolare di Vicenza (Italian bank), Monte Dei Paschi
Di Siena (Italian bank) and Zurcher Kantonalbank (Swiss bank) to set up representative
offices in India.
1.3 COMPANY PROFILE
Indian Overseas Bank
Established in 1937, Indian Overseas Bank (IOB) is a leading bank based in Chennai,
India. IOB had the distinction of simultaneously commencing operations in three
branches at Karaikudi, Chennai, and Yangon (Myanmar). Since IOB aimed to encourage
overseas banking and foreign exchange operations, it soon opened its branches in Penang
and Singapore. Today, Indian Overseas Bank boasts of a vast domain in banking sector
with over 1400 domestic branches and 6 branches overseas.
IOB was the first bank to venture into consumer credit, as it introduced the popular
Personal Loan scheme. In 1964, the Bank started computerization in the areas of inter-
branch reconciliation and provident fund accounts. Indian Overseas Bank was one of the
14 major Banks which were nationalized in 1969. After nationalization, the Bank
emphasized on opening its branches in rural parts of India. In 1979, IOB opened a
Foreign Currency Banking Unit in the free trade zone in Colombo.
In the year 2000, Indian Overseas Band undertook an initial public offering (IPO) that
brought the government's share in the bank's equity down to 75%. The equity shares of
IOB are listed in the Madras Stock Exchange (Regional), Bombay Stock Exchange, and
National Stock Exchange of India Ltd., Mumbai. Since its inception, IOB has absorbed
various Banks including the latest — Bharat Overseas Bank — in 2007.
The Bank's IT department has developed software, which is used by its 1200 branches to
provide online banking to customers. Indian Overseas Bank also has a network of about
500 ATMs throughout India. Its International VISA Debit Card is accepted at all ATMs
belonging to the Cash Tree and NFS networks. IOB also offers Internet Banking; it's one
of the Banks that the Govt. of India has approved for online payment of taxes.
Indian Overseas Bank offers investment options like Mutual Funds and Shares. It
provides a wide range of consumer and commercial banking services, including Savings
Account, Current Account, Depositary Services, VISA Cards, Credit Cards, Debit Cards,
Online Banking, Any Branch Banking, Home Loans, NRI Account, Agricultural Loans,
Payment of Bills / Taxes, Provident Fund Scheme, Forex Collection Services, Retail
Loans,etc.
Indian Overseas Bank (IOB; established 1937) is a major bank based in Chennai
(Madras), with 2018 domestic branches and six branches overseas. Indian Overseas Bank
has an ISO certified in house Information Technology department, which has developed
the software that 2018 branches use to provide online banking to customers; the bank has
achieved 100% networking status as well as 100% CBS status of branches with a total
number of 2018 CBS branches and Extension Counters. IOB also has a network of about
771 ATMs all over India and IOB's International VISA Debit Card is accepted at all
ATMs belonging to the Cash Tree and NFS networks. IOB offers internet Banking (E-
See Banking) and is one of the Banks that the Govt. of India has approved for online
payment of taxes. The bank's business more than doubled in the last four years.
According to "A profile of Banks (2009-10)" published by RBI, the bank's deposits
increased from Rs.50529 crore as on 31.03.06 to Rs.110795 crore as on 31.03.10 and
advances from Rs.34756 crore to Rs.79004 crore.
• 1937: Shri.M.Ct.M. Chidambaram Chettyar establishes the Indian Overseas Bank

(IOB) to encourage overseas banking and foreign exchange operations. IOB
started up simultaneously at three branches, one each in Karaikudi, Madras
(Chennai) and Rangoon (Yangon). It then quickly opened a branch in Penang and
another in Singapore. The bank served the Nattukottai Chettiars, who were a
mercantile class that at the time had spread from Chettinad in TamilNadu state to
Ceylon (Sri Lanka), Burma (Myanmar), Malaya, Singapore, Java, Sumatra, and
Saigon. As a result, from the beginning IOB specialized in foreign exchange and
overseas banking (see below).
• 1960s: The banking sector in India was consolidating by the merger of weak
private sector Banks with the stronger ones; IOB absorbed five Banks, including
Kulitali Bank (est. 1933).
• 1969: The Government of India nationalized IOB. At one point, probably before
nationalization, IOB had twenty of its eighty branches located overseas. After
nationalization it, like all the nationalized Banks, turned inward, emphasizing the
opening of branches in rural India.
• 1988-89: IOB acquired Bank of TamilNadu in a rescue.
• 2000: IOB engaged in an initial public offering (IPO) that brought the
government's share in the bank's equity down to 75%.
• 2009: IOB took over Shree Suvarna Sahakari Bank, which was founded in 1969
and had its head office in Pune. In 2001 it acquired the Mumbai-based Adarsha
Janata Sahakari Bank, which gave it a branch in Mumbai. Shree Suvarna Sahakari
Bank has been in administration since 2006. It has nine branches in Pune, two in
Mumbai and one in Shirpur. The total employee strength is estimated to be little
over 100.
Indian Overseas Bank (IOB) is a one of the major bank based in Chennai, with over
1,400 domestic branches and 6 branches abroad.
India Overseas Bank was established in 1937 to encourage overseas banking and foreign
exchange operations. The Indian Overseas Bank started simultaneously with three
branches. They are:
• Indian Overseas Bank Chennai

• Indian Overseas Bank Rangoon
• Indian Overseas Bank Singapore
From the beginning Indian Overseas Bank served Chettinad, Ceylon (Sri Lanka), Burma
(Myanmar), Malaya, Singapore, Java, Sumatra and Saigon.
In 1960 Indian Overseas Bank absolved five weaker private sector Banks including
Kulitali Bank. In the year 2000 India Overseas Bank India engaged in IPO which brought
the government's share in the bank's equity down to 75%.
IOB International expansion
• 1937-38: As mentioned above, IOB was international from its inception with
branches Indian Overseas Bank Rangoon, Indian Overseas Bank Penang, and
Indian Overseas Bank Singapore.
• 1941: IOB opened a branch in Malaya that presumably closed almost immediately
because of the war.
• 1946: IOB opened a branch in Ceylon.
• 1947: IOB opened a branch in Bangkok and re-opened others.
• 1948: United Commercial Bank (see below) opened a branch in Malaya.
• 1949: IOB opened a branch in Bangkok.
• 1963: The Burmese government nationalized IOB's branch in Rangoon.
• 1973: IOB, Indian Bank and United Commercial Bank established United Asian
Bank Berhad. (Indian Bank had been operating in Malaysia since 1941 and
United Commercial Bank Limited had been operating there since 1948.) The
Banks set up United Asian to comply with the Banking Law in Malaysia, which
prohibited foreign government Banks from operating in the country. Also, IOB
and six Indian private Banks established Bharat Overseas Bank as a Chennai-
based private bank to take over IOB's Bangkok branch. The Baharat Overseas
Bank is the only private bank that the Reserve Bank of India has permitted to
have a branch outside India. The ownership was: Indian Overseas Bank (30%),
Bank of Rajasthan (16%), Vysya Bank (14.66%), Federal Bank (19.67%), Karur
Vysya Bank (10%), South Indian Bank (10%) and Karnataka Bank (8.67%).
Bharat Overseas serves the Indian ethnic community in Thailand.
• 1977: IOB opened a branch in Seoul.
• 1991: Bank of Commerce (BCB), a Malaysian bank, acquired United Asian Bank
(UAB). In 1999 BCB merged with Bank Bumiputra Malaysia to form Bumiputra-
Commerce Bank Berhad.
Indian Overseas Bank Credit Card
Indian Overseas Bank has a credit card with the name CANCARD-VISA. This card is
valid for use in India and Nepal only. Indian Overseas Bank Credit Card is acceptable in
more than 1 lakh member establishments for purchase of goods and services.
Indian Overseas Bank Equity Shareholders
Indian Overseas Bank has been constituted as a Corresponding New Bank under the
Banking Companies (Acquisition and Transfer of Undertakings) Act 1970.
The Bank had offered for subscription 11,12,00,000 shares of Rs. 10 each for cash at par
aggregating Rs. 111.20 crores (including reservation of 1,11,20,000 equity shares of Rs.
10 each for cash at par to regular/permanent employees and working Director,
aggregating Rs. 11,12,00,000).
The issue which opened on September 25, 2000, closed before October 5, 2000. The
equity shares of the Bank are listed in The Madras Stock Exchange (Regional), The Stock
Exchange, Mumbai and National Stock Exchange of India Ltd., Mumbai.
1.4 OBJECTIVES OF THE STUDY
PRIMARY OBJECTIVES:
• To study the financial performance of Indian Overseas Bank.
SECONDARY OBJECTIVES:
• To identify the comparative and common size statement of the bank.

• To know the liquidity position of the bank.
• To know the changes in working capital of the bank.
• To predict the net profit of the bank.
1.5 SCOPE OF THE STUDY:
1. This analysis would help the organization to concentrate on the financial

performance of Indian Overseas Bank.
2. The financial statements are analyzed for finding out the various aspects ranging
from a simple analysis of a firm to a comprehensive assessment of the firm in
various areas.
3. This study would help the investors of share market to know the financial
soundness of the company.
4. The basis for financial planning and analysis is financial information, to predict,
compare and evaluate the financial ability.
CHAPTER – II
LITERATURE REVIEW
1. A study on the financial performance of the State Bank of India with reference to
camel model
Abstract:
The Analyst has come up with a special issue on the banking industry for a third
consecutive year. To assess Indian Banks, The Analyst adopted the world-renowned
CAMEL model (with minor modifications). The reason being, the CAMEL model is
simple and makes it easy to compare a wide range of Banks present in INDIA. CAMEL
Stands for Capital Adequacy, Asset Quality, Earnings Quality, and Liquidity. In the
consecutive banking special issues, The Analyst has ranked the Banks in each parameter,
based on the average individual rank a bank achieved for each ratio. Also, in this issue,
The Analyst has categorized the Banks into public sector Banks, private Banks and
foreign Banks. Apart from analyzing the Banks and foreign Banks on each of the ratios
based on the CAMEL model. The Analyst also provided additional information like Total
Assets on each of these Banks. Capital Adequacy reflects the overall financial condition
of the Banks and also the ability of the management to meet the need for additional
capital. it reflects a bank’s leverage. The prime motto behind measuring the asset quality
is to ascertain the component of non-performing assets as a percentage of the total assets.
In addition, the parameter also ascertains the NPA movement and the amount locked up
in investments as a percentage of the total assets. Management involves a subjective
analysis for measuring the efficiency of the management. To measure the efficiency of
the management we used parameters like profit per branch, business per employee and
advances to deposits.
2. Financial performance in Hong Kong listed hotels: the effect of value-added
creation and cost-leadership seeking
University essay from Umeå universitet/Handelshögskolan vid Umeå universitet; Umeå

universitet/Handelshögskolan vid Umeå universitet
Author: Lin Zhang; Wai Fong Chow; [2010]
Abstract:
We structure a literature review which we provide with broader definitions of the major
concepts: value creation, cost efficiency (leadership), competitive strategies, financial
performance and statement analysis. The literature review focuses mainly on Hong Kong
context and literatures supporting the similar business strategies among similar size of
companies from various industries. The study takes forms as a quantitative study with a
deductive approach. A set of financial performance data will be collected and examined,
to show how company performance is correlated to its strategies and what an outcome is.
We aim at providing another perspective of investment analysis approach to the potential
investors, so they could embrace the whole picture of available information. We develop
two groups of hypothesis; the first group is company’s strategy measures that show no
effect on financial performance, the second group is company’s strategy measures that
show some effect on financial performance. The result indicates while normally staff cost
and cost of sale are recognized as cost leadership measure under product industry, it
implies positive contribution to value creation financial performance in service industry,
instead of having influence on profitability. Also, the wealth generated from previous sale
revenue margin will have positive impact on company’s competitiveness in the hotel
industry. Keywords: value creation cost leadership, competitive strategies, financial
performance and statement analysis.
3. The financial performance of ethical funds: A comparative analysis of the risk-
adjusted performance of ethical and non-ethical mutual funds in UK
University essay from Högskolan i Jönköping/IHH, Nationalekonomi
Author: Elena Shloma; [2009]
Abstract:
The review of the ethical funds literature shows the significant growth of the Socially
Responsible Investments (SRI) in the last few decades. The increase of the interest
towards SRI indicates that ethical issues have become more essential for the investors.
However the number of surveys reveals that financial performance remains of an
important concern for the socially responsible investors. Therefore the benchmark
analysis of the expected returns and management fees of the ethical mutual funds is
chosen as a topic for this thesis research. The risk-adjusted measures are used to analyze
and compare the performance of the ethical and non-ethical mutual funds in United
Kingdom. The analysis does not indicate the significant difference in the expected returns
between the two groups of funds. However this study concludes that on average ethical
funds charge higher management fees. Thus investing in ethical funds is more costly but
gives about the same returns as investing in conventional funds.
4. A Comparison of Financial Performance in the Banking Sector:
Faculty of Business
Sohar University
Soha
Sultanate of Oman
Abstract
The purpose of this study is to classify the commercial Banks in Oman in cohesive
categories on the basis of their financial characteristics revealed by the financial ratios. A
total of five Omani commercial Banks with more than 260 branches were financially
analyzed, and simple regression was used to estimate the impact of asset management,
operational efficiency, and bank size on the financial performance of these Banks. The
study found that the bank with higher total capital, deposits, credits, or total assets does
not always mean that has better profitability performance.
CHAPTER – III
RESEARCH METHODOLOGY
3.1 RESEARCH METHODOLOGY
Research methodology is a way to systematically solve the research. To make research

systematic the researcher has to adopt certain method. Data becomes information only
when a proper methodology is adopted. Thus, we can say methodology is a tool which
processes the data to reliable information.
3.2RESEARCH DESIGN
A research design is purely a framework or plan for a study that guides the collection and
analysis of data. It is a blue print that is followed in completing a study. Here, an
analytical study would be conducted to know the existing inventory system in the
company.
3.3TYPES OF RESEARCH
3.3.1Descriptive Research
Descriptive research includes surveys and fact-finding enquiries of different kinds. The
major purpose of descriptive research is description of the state of affairs as it exists at
present.
3.3.2Analytical research
In this type of research the researcher has to use facts or information already available
and analyze these to make a critical evaluation of the material.
3.4 DATA COLLECTION
3.4.1 Primary data:
Primary data means data that are collected newly by the researcher. Primary data consists
of the original information collected for specific purpose. The primary data for this
research is collected through a structured questionnaire and observation method.
3.4.2 Secondary Data
Secondary data means data that are already available. They refer to the data which have
already been collected and analyzed by someone else and which have been passed
through the statistical process. The information about the company was collected from
internet which has been published by the Bank.
3.5 FINANCIAL TOOLS AND TECHNIQUES
o Comparative Statement
o Common size Statement
o Liquidity Ratio
o Profitability Ratio
o Working capital Statement
o Trend analysis
3.5.1COMPARATIVE BALANCE SHEET:
Comparative balance sheet as on two or more different dates can be used for comparing
assets and liabilities and findings out any increase or decrease in the items. Thus while in
single balance sheet the emphasis is on present position, it is on change in the
comparative balance sheet.
3.5.2 Common Size Balance Sheet:
A company balance sheet that displays all items as percentages of a common base figure.
This type of financial statement can be used to allow for easy analysis between
companies or between time periods of a company.
The values on the common size statement are expressed as percentages of a statement
component such as revenue. While most firms don't report their statements in common
size, it is beneficial to compute if you want to analyze two or more companies of
differing size against each other. Formatting financial statements in this way reduces the
bias that can occur when analyzing companies of differing sizes. It also allows for the
analysis of a company over various time periods, revealing, for example, what percentage
of sales is cost of goods sold and how that value has changed over time.
3.5.3 RATIO ANALYSIS:
A ratio is a mathematical relationship between two items expressed in a quantitative

form. Ratio can be defined as “Relationship expressed kin quantitative terms between
figures which have cause and effect relationship which are connected with each other in
some manner or the other. Ratio analysis involves the process of computing determining
and presenting the relationship of items or groups of items of financial statements.
3.5.3.1 – Liquidity Ratios:
Liquidity Ratios measure the firm's ability to pay off current dues i.e. repayable within a
year. Liquidity ratios are otherwise called as Short Term Solvency Ratios. The important
liquidity ratios are
1. Current ratio
2. Absolute Liquid Ratio
1. Current ratio:
This ratio is used to assess the firm's ability to meet its current liabilities. The relationship
of current assets to current liabilities is known as current ratio. The ratio is calculated as:
Current assets
Current Ratio = -----------------------
Current liabilities
Current Assets are those assets, which are easily convertible into cash within one year.
This includes cash in hand, cash at bank, sundry debtors, bills receivable, short term
investment or marketable securities, stock and prepaid expenses.
Current Liabilities are those liabilities which are payable within one year. This includes
bank overdraft, sundry creditors, bills payable and outstanding expenses.
2. Absolute Liquid Ratio:
It is a modified form of liquid ratio. The relationship of absolute liquid assets to liquid
liabilities is known as absolute liquid ratio. This ratio is also called as 'Super Quick
Ratio'. The ratio is calculated as:
Absolute Liquid Assets
Liquid Ratio = -----------------------------
Liquid Liabilities
Absolute liquid assets mean cash, bank and short term investments. Liquid liabilities
means current liabilities less bank overdraft.
3.5.3.2 – Profitability Ratios:
Efficiency of a business is measured by profitability. Profitability ratio measures the

profit earning capacity of the business concern. The important profitability ratios are
discussed below:
1. Gross Profit Ratio
2. Net Profit Ratio
3. Operating Profit Ratio
1. Gross Profit Ratio:
This ratio indicates efficiency of trading activities. The relationship of Gross profit to
Sales is known as gross profit ratio. The ratio is calculated as:
Gross Profit
Gross Profit Ratio = ------------------------ * 100
Sales
Gross profit is taken from the Trading Account of a business concern. Otherwise Gross
profit can
be calculated by deducting cost of goods sold from sales. Sales means Net sales.
Gross profit = Sales – Cost of goods sold

Cost of goods sold = Opening stock + Purchases – Closing Stock
(Or)
Sales – Gross Profit
2. Net Profit Ratio:
This ratio determines the overall efficiency of the business. The relationship of Net profit
to Sales is known as net profit ratio. The ratio is calculated as:
Net Profit
Net Profit Ratio = --------------- * 100
Sales
Net Profit is taken from the Profit and Loss account of the business concern or the gross
profit of the concern less administration expenses, selling and distribution expenses and
financial expenses.
3. Operating Profit Ratio:
This ratio is an indicator of the operational efficiency of the management. It establishes

the relationship between Operating profit and sales. The ratio is calculated as:
Operating Profit
Operating Profit Ratio = --------------------- * 100
Sales
Operating profit = Net profit + Non-operating expenses – Non-operating income.

(Or)
Gross Profit – Operating expenses
Where, Non-operating expenses are interest on loan and loss on sale of assets.
Non-operating incomes are dividend, interest received and profit on sale of asset.
Operating expenses include administration, selling and distribution expenses. Financial
expenses like interest on loan excluded for this purpose.
3.5.5. Working Capital Statement:
The statement of change in working capital is concerned with the current assets and
current liabilities alone, as they are shown in the Balance Sheets of the current year and
the previous year. All non current assets and non current liabilities, profits and losses,
additional information available are completely ignored.
Each current asset and current liability in the period’s Balance Sheet is compared with
those shown in the previous period‘s Balance Sheet. Increase or decrease in each of the
assets and liabilities is noted. The effect of such increase or decrease during the period in
each item individually on the working capital is recorded. Finally the overall change in
the working capital is calculated.
3.5.6 Trend Analysis:
It can be helpful in determining unusual changes in balances from period to period. It

helps in understanding past behavior. By observing data over a period of time one can
easily understand what changes have taken place in the past. Such analysis will be
extremely helpful in predicting the future behavior.
Future can be predicted by using the trend line y=a+bx
Where,
a = ∑Y/N
b=∑xy/∑X2
x= current year- assumed year.
3.6 DATA USED FOR THE STUDY:
The data used for analysis purpose are 5 years Financial Data like
• Profit and loss account

• Balance Sheet
3.6.1PERIOD OF THE STUDY:
The period of the study is 2006-2010.

3.7 LIMITATION OF THE STUDY:
• The data used are limited to the extent duo to confidentiality maintained with in
the bank.
• The number of years used for analysis is very limited.
• The study heavily depends on the secondary data and any shortcomings are bound
to be reflected. How ever such data are correct, when those were audited.
• Any change in the methods or procedures of accounting systems limits the utility
of financial statements.
CHAPTER – IV
DATA ANALYSIS AND INTERPRETATION
4.1COMPARATIVE BALANCE SHEET STATEMENT:
4.1.1 COMPARATIVE BALANCE SHEET FOR THE YEAR 2006-07:
(` in Crores)
Particulars 2006 2007 Increase/Decrease %

ASSETS:
Other Assets 1484.35 1732.11 247.76 16.69
Current Assets & Advances:
Cash & Balance with RBI 3077.96 4686.11 1608.15 52.25
Balance with Banks 629.28 4293.19 3663.91 582.24
Advances 34756.20 47060.29 12304.09 35.40
Investments 18952.28 23974.47 5022.19 26.50
Current asset total 57415.72 80014.06 22598.34 696.39
Total 58900.07 81746.17 22846.1 38.79

Liabilities:
Equity share capital 544.80 544.80 0.00 0.00
Reserves 2510.17 3327.59 817.42 32.56
Debts:
Deposits 50529.32 68740.41 18211.09 36.04
Borrowings 736.63 2896.23 2159.6 293.17
Current Liabilities:
Other Liabilities & Provisions 4914.43 6629.82 1715.39 34.91
Total 59235.35 82138.85 22903.50 38.67
Inference:
The above table shows that, the Banks other assets have been increased by 16.69% and
the current asset value have been increased by 696.39%. The deposits value increased to
32.56% from the previous year and the borrowings value increased by 293.17%. Current
liabilities have been increased by 34.91% from the previous year.

(` in Crores)

ASSETS:
Other Assets 1732.11 2061.29 329.18 19.00
Balance with Banks 4293.19 1217.09 (3076.1) (71.65)
Advances 47060.29 60423.84 13363.55 28.40
Investments 23974.47 28474.71 4500.24 18.77
Total 81746.17 101301.16 19554.99 23.92

Liabilities:
Reserves 3327.59 4197.90 870.31 26.15
Debts:
Deposits 68740.41 84325.58 15585.17 22.67
Borrowings 2896.23 6353.65 3457.42 119.38
Other Liabilities & Provisions 6629.82 6323.84 (305.98) (4.61)
Total 82138.85 101745.77 19606.92 23.87
Inference:
The above table shows that, the Banks other assets have been increased by 19.00%
and the current asset value have been increased by 70.23%. The deposits value increased
to 32.56% from the previous year and the borrowings value increased by 22.67%. Current
liabilities have been decreased by 4.61% from the previous year.
(` in Crores)

ASSETS:
Other Assets 2061.29 2340.93 279.64 13.57
Cash & Balance with RBI 9124.23 5940.44 (3183.79) (34.89)
Advances 60423.84 74885.27 14461.43 23.93
Investments 28474.71 31215.44 2740.73 9.63
Total 101301.16 119300.54 17999.38 17.77

Liabilities:
Reserves 4197.90 5396.59 1198.69 28.55
Debts:
Deposits 84325.58 100115.89 15790.31 18.73
Borrowings 6353.65 6548.28 194.63 3.06
Other Liabilities & Provisions 6323.84 7258.26 934.42 14.78
Total 101745.77 119863.82 18118.05 17.81
Inference:
and the current asset value have been increased by 302.79%. The deposits value
increased to 18.73% from the previous year and the borrowings value increased by
3.06%. Current liabilities have been increased by 14.78% from the previous year.

(` in Crores)

ASSETS:
Other Assets 2340.93 2917.70 576.77 24.64
Balance with Banks 4918.46 2158.19 (2760.27) (56.12)
Advances 74885.27 79003.93 4118.66 5.50
Investments 31215.44 37650.56 6435.12 20.62
Current asset total 116959.60 126479.1 9519.50 (0.95)
Total 119300.54 129396.83 10096.29 8.46

Liabilities:
Reserves 5396.59 5804.18 407.59 7.55
Debts:
Deposits 100115.89 110794.71 10678.82 10.67
Borrowings 6548.28 8982.20 2433.92 37.17
Other Liabilities & Provisions 7258.26 3794.90 (3463.36) (47.72)
Total 119863.82 129920.79 10056.97 8.39
Inference:
and the current asset value have been decreased by 0.95%. The deposits value increased
to 10.67% from the previous year and the borrowings value increased by 3.06%. Current
liabilities have been decreased by 47.72% from the previous year.
4.2 COMMONSIZE BALANCE SHEET STATEMENT
4.2.1 COMMONSIZE BALANCE SHEET FOR THE YEAR 2006-07:
(` in Crores)
PARTICULARS 2006 PERCENTAGE 2007 PERCENTAGE

ASSETS:
Other Assets 1484.35 2.52 1732.11 2.12
CURRENT ASSET,
LOANS & ADVANCES:
Advances 34756.2 59.01 47060.2 57.57
Investments 0 32.18 9 29.33
8 7
57415.7 80014.
2 06
Total 58900.0 100.00 81746.1 100.00

7 7
LIABILITIES:
Reserves 2510.17 4.24 3327.59 4.05
LOANS:
Deposits 50529.3 85.03 68740.4 83.69
Borrowings 2 1.24 1 3.53
CURRENT LIABILITIES: 736.63 2896.23
Other Liabilities & 8.30 8.07
Provisions 4914.43 6629.82
Total 59235.3 100.00 82138.8 100.00
5 5
Inference:
The above table shows that, the Banks other assets have been slightly decreased from
the previous year i.e. (2.52% to2.12%) and the current asset have been increased from
97.48% to 97.88%. The deposits decreased to 83.69% from the previous year and the
borrowings for the year 2007 are 3.53% which is higher than previous year 2006. Current
liabilities have been decreased to 8.07%.
(` in Crores)

ASSETS:
Other Assets 1732.11 2.12 2061.29 2.26
CURRENT ASSET,
LOANS & ADVANCES:
Advances 47060.2 57.57 47060.29 51.71
Investments 9 29.33 28474.71 31.29
7 2
80014.0
6
Total 81746.1 100.00 91013.7 100.00
7
LIABILITIES:
Reserves 3327.59 4.05 4197.90 4.13
LOANS:
Deposits 68740.4 83.69 84325.58 82.88
Borrowings 1 3.53 6353.65 6.24
CURRENT 2896.23
LIABILITIES: 8.07 6323.84 6.22
Other Liabilities & 6629.82
Provisions
Total 82138.8 100.00 101745.7 100.00
5 7
Inference:
The above table shows that, the Banks other assets have been increased from the
previous year i.e. (2.12% to2.26%) and the current asset posted a slight variation i.e. (-
0.14%). The deposits decreased to 82.88% from the previous year and the borrowings for
the year 2008 are 6.24% which is higher than previous year 2007. Current liabilities have
been decreased to 6.22%.
(` in Crores)

ASSETS:
Other Assets 2061.29 2.26 2340.93 1.96
CURRENT ASSET,
LOANS & ADVANCES:
Advances 47060.29 51.71 74885.27 62.77
Investments 28474.71 31.29 31215.44 26.17
Total 91013.7 100.00 119300.54 100.00

LIABILITIES:
Reserves 4197.90 4.13 5396.59 4.50
LOANS:
Deposits 84325.58 82.88 100115.89 83.52
Borrowings 6353.65 6.24 6548.28 5.46
CURRENT LIABILITIES:
Other Liabilities & 6323.84 6.22 7258.26 6.06
Provisions
Total 101745.7 100.00 119863.82 100.00
7
Inference:
The above table shows that, the above table shows that, the Banks other assets have
been slightly decreased from the previous year i.e. (2.26% to1.96%) and the current asset
have been increased from 97.74% to 98.04%. The deposits increased to 83.59% from the
previous year and the borrowings for the year 2009 are 5.46% which is lesser than
previous year 2008. Current liabilities have been decreased to 6.06%.
(` in Crores)
PARTICULARS 2009 PERCENTAG 2010 PERCENTAGE

E
ASSETS:
Other Assets 2340.93 1.96 2917.70 2.25
CURRENT ASSET,
LOANS & ADVANCES:
Advances 74885.27 62.77 79003.93 61.06
Investments 31215.44 26.17 37650.56 29.10
Current asset total 116959.6 98.04 126479. 97.75
1
Total 119300.54 100.00 129396.83 100.00

LIABILITIES:
Reserves 5396.59 4.50 5804.18 4.47
LOANS:
Deposits 100115.89 83.52 110794.71 85.28
Borrowings 6548.28 5.46 8982.20 6.91
CURRENT LIABILITIES:
Other Liabilities & 7258.26 6.06 3794.90 2.92
Provisions
Total 119863.82 100.00 129920.79 100.00
Inference:
The above table shows that, the Banks other assets have been slightly decreased from
the previous year i.e. (2.26% to1.96%) and the current asset have been increased from
97.74% to 98.04%. The deposits increased to 83.59% from the previous year and the
borrowings for the year 2009 are 5.46% which is lesser than previous year 2008. Current
liabilities have been decreased to 6.06%.
4.3 Liquidity Ratio:
Current Asset
1. Current Ratio = -----------------------
Current Liabilities
4.3.1. Table showing Current ratio for the year 2005-2010
(` in Crores)
Year Current Assets Current Liabilities Current Ratio
2009-2010 2917.70 3794.90 0.76

2008-2009 2340.93 7528.26 0.32
2007-2008 2061.29 6323.84 0.32
2006-2007 1732.11 6629.82 0.26
2005-2006 1484.35 4914.43 0.30
4.3.1.1 Chart Showing Current ratio for the year 2005-2010

Inference:
The Bank’s Current ratio position is stable from 2006-2008 and it posted a sudden
increase in the current ratio as 0.76% in the year 2009-2010 due to the decrease in current
liabilities.
Absolute Liquid Asset

2. Absolute Liquid Ratio = ------------------------------
Liquid Liabilities
4.3.2. Table showing Absolute Liquid ratio for the year 2005-2010
(` in Crores)
Year Absolute Liquid Assets Liquid Liabilities Absolute Liquid Ratio

2009-2010 2158.19 3794.90 0.57
2008-2009 4981.46 7528.20 0.66
2007-2008 1217.09 6323.84 0.19
2006-2007 4293.19 6629.83 0.64
2005-2006 629.28 4914.43 0.13
4.3.2.1 Chart Showing Absolute ratio for the year 2005-2010

Inference:
The Bank’s Absolute Liquid ratio position is fluctuating throughout the period of 2006-
2010. The Absolute liquid ratio of the Bank ranges from 0.13% - 0.66%.
4.4 Profitability Ratio:
Gross Profit
1. Gross Profit Ratio = ------------------- * 100
Sales
4.4.1 Table Showing the Gross Profit ratio for the year 2005-2010
(` in Crores)
Year Gross Profit Sales Gross Profit Ratio

2009-2010 1844.62 10245.77 18.00
2008-2009 2455.22 9641.40 25.47
2007-2008 2001.78 7968.25 25.12
2006-2007 1560.04 5832.07 26.75
2005-2006 1533.82 4406.28 34.81
4.4.1.1 Chart Showing Gross Profit ratio for the year 2005-2010
Inference:
The Gross Profit ratio of the bank tends to decrease from 34.81 to 18.00 for the period
2006-2010. The gross profit ratio for the current year 2009-2010 is 18%.
Net Profit
2. Net Profit Ratio = ----------------- * 100
Sales
4.4.2 Table Showing the Net Profit ratio for the year 2005-2010
(` in Crores)
Year Net Profit Sales Net Profit Ratio

2009-2010 706.96 10245.77 6.90
2008-2009 1323.79 9641.40 13.73
2007-2008 1202.34 7968.25 15.09
2006-2007 1008.43 5832.07 17.29
2005-2006 783.34 4406.28 17.78
4.3.2.1 Chart Showing Net Profit ratio for the year 2005-2010
Inference:
Net Profit ratio of the Bank remains stable for the year 2006 & 2007 (i.e.) (17.78% &
17.29%) and it tends to decrease in next two financial year, 2008 & 2009 i.e. (15.09% &
13.73%) and for the current year the Net Profit ratio decreases almost 50% from the
preceeding year i.e. (6.90%).
Operating Profit
3. Operating Profit Ratio = ----------------------- * 100
Sales
4.4.3. Table showing Operating Profit ratio for the year 2005-2010
(` in Crores)
Year Operating Profit Sales Operating Profit Ratio

2009-2010 6995.79 10245.77 68.28
2008-2009 7130.29 9641.40 73.95
2007-2008 6136.11 7968.25 77.01
2006-2007 4257.66 5832.07 73.00
2005-2006 2596.52 4406.28 58.93
4.3.1.1 Chart Showing Operating Profit ratio for the year 2005-2010
Inference:
The operating profit of the Bank increases for the period 2005-2008 and then it decreases
due to the increasing in operating expenses.
4.5 WORKING CAPITAL STATEMENT:
4.5.1 WORKING CAPITAL STATEMENT FOR THE YEAR 2006-07:
(` in Crores)
Particulars 2006 2007

Current Assets:
Cash & Balance with RBI 3077.96 4686.11

Balance with Banks 629.28 4293.19
Advances 34756.20 47060.29
-------------- -------------
Total (A) 38463.44 56039.59
-------------- -------------
Borrowings 736.63 2896.23

Other Liabilities & Provisions 4914.43 6629.82
------------- -------------
Total (B) 5651.06 9526.05
------------- -------------
Working Capital (A-B) 32812.38 46513.54
Inference:
The company's working capital position for the year 2006 was ` 32812 and it increased in
the year 2007 to ` 46513.54.
(` in Crores)

Current Assets:

Advances 47060.29 60423.84
------------- -------------
Total (A) 56039.59 70765.16
------------- -------------
Borrowings 2896.23 6353.65

------------- -------------
Total (B) 9526.05 12677.49
------------- -------------
Inference:
The company's working capital position for the year 2007 was ` 46153.54 and it
increased in the year 2008 to ` 58087.67.
(` in Crores)

Current Assets:

Advances 60423.84 74885.27
------------- ------------
Total (A) 70765.16 85807.17
------------- ------------
Borrowings 6353.65 6548.28

------------- ------------
Total (B) 12677.49 13806.54
------------- ------------
Inference:
The company's working capital position for the year 2008 was ` 55087.67 and increased
in the year 2008 to ` 72000.63.
4.5.4 WORKING CAPITAL STATEMENT FOR THE YEAR 2009-10
(` in Crores)
Current Assets:

Advances 74885.27 79003.93
------------ -------------
Total (A) 85807.17 88820.57
------------ -------------
Borrowings 6548.28 8982.20

------------ ------------
Total (B) 13806.54 12777.10
------------ ------------
Inference:
The company's working capital position for the year 2009 was ` 72000.63 and increased
in the year 2010 to ` 76051.47.
4.5. TREND ANALYSIS
4.5.1. Trend analysis for predicting net profit
(` In Crores)
Year(X) Net Profit (y) x=(X-A) x2 xy
2010 706.96 -2 4 1413.92
2009 1323.79 -1 1 1323.79
2008 (A) 1202.34 0 0 0
2007 1008.43 1 1 -1008.43
2006 783.34 2 4 -1566.68
Total 162.60
a = ∑y/n  5024.86/5 = 1004.972
b= ∑xy/∑x2  162.60/10 = 16.2
y = a + bx
If x = 3 i.e. (2010-11)
y = 1004.972 + 16.20(3)
y = 1004.972+48.60
y = 1053.572
If x = 4 i.e. (2011-12)
y = 1004.972 + 16.20(4)
y = 1004.972+64.80
y = 1069.772
Net Profit for the year of 2010 – 11 is predicted as ` 1053.572

Net Profit for the year of 2011-12 is predicted as ` 1069.772
Inference:
From the trend analysis it is inferred that the net profit for the year 2010-11 & 2011-12 is
predicted as` 1053.572 and ` 1069.772
CHAPTER – V
FINDINGS, SUGGESTION & CONCLUSION
5.1 FINDINGS:
• The Banks other assets have been increased by 16.69% and the current asset value
have been increased by 696.39%. The deposits value increased to 32.56% from
the previous year and the borrowings value increased by 293.17%. Current
liabilities have been increased by 34.91% from the previous year.
have been increased by 70.23%. The deposits value increased to 32.56% from the
previous year and the borrowings value increased by 22.67%. Current liabilities
have been decreased by 4.61% from the previous year.
have been increased by 302.79%. The deposits value increased to 18.73% from
the previous year and the borrowings value increased by 3.06%. Current liabilities
have been increased by 14.78% from the previous year.
have been decreased by 0.95%. The deposits value increased to 10.67% from the
previous year and the borrowings value increased by 3.06%. Current liabilities
have been decreased by 47.72% from the previous year.
• The Banks other assets have been slightly decreased from the previous year i.e.
(2.52% to2.12%) and the current asset have been increased from 97.48% to
97.88%. The deposits decreased to 83.69% from the previous year and the
borrowings for the year 2007 are 3.53% which is higher than previous year 2006.
Current liabilities have been decreased to 8.07%.
• The Banks other assets have been increased from the previous year i.e. (2.12%
to2.26%) and the current asset posted a slight variation i.e. (-0.14%). The deposits
decreased to 82.88% from the previous year and the borrowings for the year 2008
are 6.24% which is higher than previous year 2007. Current liabilities have been
decreased to 6.22%.
98.04%. The deposits increased to 83.59% from the previous year and the
borrowings for the year 2009 are 5.46% which is lesser than previous year 2008.
98.04%. The deposits increased to 83.59% from the previous year and the
borrowings for the year 2009 are 5.46% which is lesser than previous year 2008.
• The Bank’s Current ratio position is stable from 2006-2008 and it posted a sudden
increase in the current ratio as 0.76% in the year 2009-2010.
• The Bank’s Absolute Liquid ratio position is fluctuating throughout the period of
2006-2010 (0.13% - 0.66%).
• The Gross Profit ratio of the bank tends to decrease from 34.81 to 18.00 for the
period 2006-2010.
• Net Profit ratio of the bank remains stable for the year 2006 & 2007 and it tends
to decrease in next two financial year, 2008 & 2009 i.e. and for the current year
the Net Profit ratio decreases almost 50% from the preceeding year i.e. (6.90%).
• The Operating profit of the Bank increases for the period 2005-2008 and then it
decreases due to the increasing in operating expenses.
• The company's working capital position for the year 2006 was ` 32812 and it
• The company's working capital position for the year 2007 was ` 46153.54 and it
• The company's working capital position for the year 2008 was ` 55087.67 and
• The company's working capital position for the year 2009 was ` 72000.63 and
• The trend analysis is inferred that the net profit for the year 2010-11 & 2011-12 is
predicted as ` 1053.572 and ` 1069.772.
5.2 SUGGESTION:
 The profit position of the bank are decreasing in order to overcome from this
situation bank should take immediate recovery measures to retain their profit
position.
 The bank should concentrate on increasing the current asset position. The bank
can provide short term loans and advances to increase its working capital position.
 The bank should take preventive measures in order to retain their liquidity
position as it ranges to higher fluctuations.
5.3 CONCLUSION:

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CHAPTER – I

Financial management is applicable to every type of organization, irrespective of its size

Financial performance analysis is largely a study of relationship among the various

Financial performance analysis is an attempt to determine the significance and meaning

• Early phase from 1786 to 1969 of Indian Banks

Indian Overseas Bank

• 1937: Shri.M.Ct.M. Chidambaram Chettyar establishes the Indian Overseas Bank

• Indian Overseas Bank Chennai

• 1947: IOB opened a branch in Bangkok and re-opened others.

• 1948: United Commercial Bank (see below) opened a branch in Malaya.

• 1949: IOB opened a branch in Bangkok.

• 1963: The Burmese government nationalized IOB's branch in Rangoon.

• 1977: IOB opened a branch in Seoul.

Indian Overseas Bank Equity Shareholders

• To study the financial performance of Indian Overseas Bank.

• To identify the comparative and common size statement of the bank.

1. This analysis would help the organization to concentrate on the financial

University essay from Umeå universitet/Handelshögskolan vid Umeå universitet; Umeå

Author: Lin Zhang; Wai Fong Chow; [2010]

University essay from Högskolan i Jönköping/IHH, Nationalekonomi

Author: Elena Shloma; [2009]

3.1 RESEARCH METHODOLOGY

Research methodology is a way to systematically solve the research. To make research

3.4.1 Primary data:

3.4.2 Secondary Data

3.5 FINANCIAL TOOLS AND TECHNIQUES

3.5.1COMPARATIVE BALANCE SHEET:

3.5.3 RATIO ANALYSIS:

A ratio is a mathematical relationship between two items expressed in a quantitative

3.5.3.1 – Liquidity Ratios:

2. Absolute Liquid Ratio:

3.5.3.2 – Profitability Ratios:

Efficiency of a business is measured by profitability. Profitability ratio measures the

1. Gross Profit Ratio:

Gross profit = Sales – Cost of goods sold

This ratio is an indicator of the operational efficiency of the management. It establishes

Operating profit = Net profit + Non-operating expenses – Non-operating income.

3.5.5. Working Capital Statement:

It can be helpful in determining unusual changes in balances from period to period. It

Future can be predicted by using the trend line y=a+bx

x= current year- assumed year.

3.6 DATA USED FOR THE STUDY:

• Profit and loss account

3.6.1PERIOD OF THE STUDY:

The period of the study is 2006-2010.

• The number of years used for analysis is very limited.

DATA ANALYSIS AND INTERPRETATION

4.1COMPARATIVE BALANCE SHEET STATEMENT:

4.1.1 COMPARATIVE BALANCE SHEET FOR THE YEAR 2006-07:

Particulars 2006 2007 Increase/Decrease %

Total 58900.07 81746.17 22846.1 38.79

4.1.2 COMPARATIVE BALANCE SHEET FOR THE YEAR 2007-08:

Particulars 2007 2008 Increase/Decrease %

Total 81746.17 101301.16 19554.99 23.92

Particulars 2008 2009 Increase/Decrease %

Total 101301.16 119300.54 17999.38 17.77

4.1.4 COMPARATIVE BALANCE SHEET FOR THE YEAR 2009-10:

Particulars 2009 2010 Increase/Decrease %