Question 1. a) CSR should be a company’s core element.

The regulations and public policies

tend to bring bare minimum involvement by companies in their corporate responsibilities. Thus,
many companies have voluntarily taken initiatives in the field of corporate social responsibility.
Corporates like TATA, ITC, Aditya Birla, and Indian Oil Corporation, are few to name who are
involved in helping the society ever since their foundation
Tata Steel's CSR expense for 2018-19 at INR 3.15 billion which is up by over 282% from
prescribed limit. Tata Steel has adopted the Corporate Citizenship Index, Tata Business
Excellence Model and the Tata Index for Sustainable Development. Under the group, over 500
self-help groups are currently operating under various poverty alleviation programs; out of which
over 200 are engaged in activities of income generation thorough micro enterprises. Women
empowerment programs through Self-Help Groups have been extended to 700 villages. In its
100th year, the Tata Steel Centenary Project was announced. The healthcare projects of Tata
Steel include facilitation of child education, immunization and childcare, plantation activities,
creation of awareness of AIDS and other healthcare projects.
Tata Chemicals Limited was one of the first organizations to hold an Impact camp, which was
held at Mithapur in the year 1982, providing eye care to hundreds of patients at the Mithapur
Hospital. Tata Chemicals Limited was also the first organization to run world's first hospital on
wheels - the Life Line Express, through Jamnagar district for the first time between November
21, 2004 and December 21, 2004.
b)  It is extremely necessary to clearly analyze the stakeholders and their impact on the company.
Stakeholders should be agreed and in support of the change company is going to do.
Tata Motors is an international organization and dreams to expand itself globally and another
change it wants to do is making itself eco-friendly. Change in organization can’t be possible
alone by organization it needs active involvement of its stakeholders. Tata Motors is always
depended on its suppliers for raw material so they are key stakeholders. On other hand,
customers interests are need to be known for the improvement of vehicles and facilities provided
along with them. Tata Steels engages with stakeholders prior to the implementation of policies or
actions that are likely to have an impact on them. The Company interacts on a regular basis with
the community, through public hearings and meetings with various groups such as the Zila
Parishad, Senior Citizens, tribal leaders and groups, and local leaders. The Company uses the
forums of the Annual General Meeting, analyst meetings and investor road shows to meet with
investors and address issues of performance, long-term strategy and growth plans. For
employees, issues such as career planning, compensation, growth training and development are
addressed through dialogues, Joint Development Councils, Performance Management System,
etc. For issues related to health and safety, the Company focusses on the Safety Excellence
Journey, the Wellness@ Workplace Programme and other training events.
Thus, apart from profit maximization, a firm or a company should make efforts towards the well
beings of its stakeholders.
Question 2. a) From the annuity valuation Table 3 in slides:
FVAn = R(FVIFAr%, n)
= INR 5,000 (FVIFA8%, 4)
= INR 5000*4.506
= INR 22,530
Using full calculation:
FVA4 = INR 5000*(1.08)3 = 5000*(1.08)2 + 5000*(1.08)1 + 5000(1.08)0
= INR 6298.56 + 5832 + 5400 + 5000
= INR 22,530
Ans. The future value of annuity at the end of 4 years is INR 22,530.
b) As the finance manager, I would need to understand many things about the industry and the
specific organization I work for, to assess its working capital requirements. These factors will
include seasonality and other factors. For example, in case of a woolen garments manufacturer in
a hill station in Himachal Pradesh that sells directly to customers and also exports:

 Seasonality – more working capital than average will be needed during winters to
manufacture and sell because most people will buy woolen clothes then, and fewer
people would buy them in summer to wear them in a colder season. While most of the
production would happen in winter, I would need to ascertain whether it is possible for
the sales team to also sell discounted clothes during the summer for an even distribution
of sales and production to avoid sharp fluctuations in working capital requirements. We
will also need to ascertain the volume of sale, or by how much our sales increase in the
winter. If they increase substantially, we will need substantially more working capital and
evaluate long and short term financing options to adequately meet the season’s needs.
 Supply and price of raw material – if the supply of wool is easy, prompt, and adequate,
less funds will be needed but if the supply is unpredictable and seasonal, then more
working capital would be required. In our example, this would depend on the timing of
sheep rearing and if the timing does not match with our seasonality, we might have to
import wool, which would require higher working capital. I will also need to investigate
if our raw material costs have increased; if they have, more working capital will be
needed to finance the same assets. As the finance manager, I would need to work with the
Supply Chain Manager to understand our suppliers’ timings and costs.
 Credit availability – In case of a sharp increase in demand and hence manufacturing, if
credit can be obtained quickly from banks and other financial institutions and there is less
risk of falling short of working capital needs, the company will need to maintain less
working capital on hand.
 Credit policy – Assuming that the company sells to end customers for cash, working
capital will not be tied up. However, in case of our exports, we will need to follow a
rationalized and perhaps flexible policy to ensure that our export customers can pay on
time and no working capital remains tied up.
 Other factors – as the Finance Manager, I will need to analyze the balance between
liquidity and profitability that needs to be maintained, as they both are important and
have an inverse relationship. Some other important factors include ensuring efficiency of
production and strong management coordination to ensure less working capital needs;
and the external environment, such as innovations in cheaper transportation facilities and
infrastructure would mean less working capital requirements.