SYNOPSIS

REPORT
ON
WORKING CAPITAL
SUBMITTED BY:- SUNITA DEVI
 COMPANY PROFILE

COMPANY NAME:- NATIONAL FERTILIZERS LIMITED.

INDUSTRY:- CHEMICALS.
FOUNDED:- 23 AUGUST 1974.
HEADQUARTERS:- NOIDA, INDIA.
PRODUCT:- UREA ,AMMONIA ORGANIC INDUSTRIAL
CHEMICALS.
WORKING CAPITAL

WORKING CAPITAL IS SIMPLY CURRENT ASSET MINUS CURRENT

LIABILITIES AND THE AMOUNT CAN BE POSITIVE OR NEGATIVE.
WORKING CAPITAL IS BASICALLY AN EXPRESSION OF HOW MUCH IN
LIQUID ASSETS THE COMPANY CURRENTLY HAS TO BUILD ITS
BUSINESS, FUND ITS GROWTH AND PRODUCT VALUE FOR THE
OWNER. THE FASTER A BUSINESS EXPAND, THE MORE CASH IT WILL
NEED FOR WORKING CAPITAL AND INVESTMENT THE CHEAPEST AND
BEST SOURCES OF CASH EXIST AS WORKING CAPITAL RIGHT WITHIN
THE BUSINESS . GOOD MANAGEMENT OF WORKING CAPITAL IS VERY
IMPORTANT BECAUSE THE TERM IS USED FOR THE CAPITAL NEEDED
FOR DAY-TO-DAY OPERATIONS.
 KINDS OF WORKING CAPITAL

1.ON THE BASIS OF CONCEPT

GROSS WORKING CAPITAL:-
GROSS WORKING CAPITAL IS THE TOTAL OF ALL THE CURRENT
ASSETS OF A BUSINESS.
NET WORKING CAPITAL:-
NET WORKING CAPITAL MEANS THE EXCESS OF CURRENT ASSETS OVER
CURRENT LIABILITIES. I.E.NET WORKING CAPITAL=CURRENT ASSETS
CURRENT LIABILITIES.
CURRENT ASSETS
CURRENT LIABILITIES
KINDS OF WORKING CAPITAL

2. ON THE BASIS OF TIME

PERMANENT WORKING CAPITAL
TEMPORARY WORKING CAPITAL
 WORKING CAPITAL OF
NATIONAL FERTILIZERS
LIMITED,
NANGAL UNIT.

NET WORKING CAPITAL

WORKING CAPITAL CYCLE
CASH MANAGEMENT AT NFL
RECEIVABLE MANAGEMENT AT NFL
INVENTORY MANAGEMENT AT NFL
 CASH MANAGEMENT IN NFL

A. CASH INFLOW AND OUTFLOW

CASH INFLOWS
OUT FLOWS
B. CASH BALANCE HELD BY THE FIRM
C. CASH PLANNING IN NFL
D. CONVERSION OF PAYMENT IN CASH
E. INTER BANK TRANSFER
 INVENTORY MANAGEMENT
SYSTEM IN NFL
PURCHASE DEPARTMENT
STORE DEPARTMENT
 OBJECTIVES OF THE STUDY

THE OBJECTIVES OF THE STUDY ARE AS FOLLOWS:

TO STUDY THE WORKING CAPITAL POSITION OF NFL.
IT INCLUDES: -
TO STUDY THEIR CASH, RECEIVABLE AND INVENTORY
MANAGEMENT.
TO FIND OUT LENGTH OF THERE WORKING CAPITAL CYCLE.
TO ANALYZE PERFORMANCE AND POSITION OF THE
COMPANY.
 RESEARCH METHODOLOGY

IN ORDER TO ACHIEVE THE OBJECTIVES MENTIONED A

SYSTEMATIC METHODOLOGY NORMS WERE FOLLOWED. EVERY
MINUTE DETAIL OF DATA WAS COLLECTED BY DIRECT METHOD I.E.
THROUGH INTERACTION AS WELL AS BY INDIRECT METHOD I.E.
BY ASSESSING THE WRITTEN RECORDS. THE WORK WAS
PRECEDED UNDER THE DIRECTION OF FINANCE MANAGER AND
CATEGORY WISE REPORT WAS PREPARED. THIS PROJECT WAS
BASICALLY A FACT GATHERING EXERCISE AND EVALUATING AND
COMPARING ASPECTS DREW INFLUENCE.

 RESEARCH DESIGN

EXPLORATORY AND DESCRIPTIVE RESEARCH DESIGN.

THE DATA IS ANALYZED IN A TABULAR FORM AND IN WELL
AND EASY TO UNDERSTAND MANNER.
 DATA COLLECTION

BOTH PRIMARY AND SECONDARY DATA HAS BEEN USED IN THIS STUDY.
PRIMARY DATA
MOST OF THE DATA HAS BEEN COLLECTED THROUGH PERSONAL
INTERACTION WITH SENIOR OFFICERS AND STAFF OF FINANCE
DEPARTMENT OF NFL-NANGAL UNIT.
SECONDARY DATA
SECONDARY DATA INCLUDES FINANCIAL REPORTS AND MANUALS OF
THE NFLS NANGAL UNIT AND COMPANYS ANNUAL REPORTS. IT ALSO
INCLUDES JOURNAL, MANUALS AND BOOKS ON THE TOPIC UNDER
STUDY. TO GET INFORMATION ABOUT INDUSTRY AND COMPANY, MANY
WEB SITES WERE ALSO VISITED.
 FINDINGS
COMPANY IS USING OLD MACHINERY FOR PRODUCTION DUE TO THIS
REQUIREMENT OF MANPOWER IS MORE AND THE SALES ARE JUST
SATISFACTORY.
REPAIR & MAINTENANCE EXPENSES OF THE PLANTS ARE ON HIGHER
SIDE.
THE UNIT INCURS HEAVY FREIGHT CHARGES, WHICH ARE MORE THAN
THE FREIGHT SUBSIDY RECEIVED FROM THE GOVT.
SALARY & WAGES, SOCIAL, ADMINISTRATIVE AND MARKETING
EXPENSES OF THE UNIT ARE VERY HIGH. AT THE SAME TIME THESE
EXPENSES CONSTITUTE A MAJOR PART OF THE COST OF PRODUCTION.
PRODUCTION OF UREA NEVER CROSSES THE 100% OF INSTALLED
CAPACITY IN THE FINANCIAL YEARS UNDER STUDY WHEREAS THE
PRODUCTION IN EARLIER YEAR RECORDED MORE THAN 100%
CAPACITY UTILIZATIONS FOR A NUMBER OF TIMES
THANK YOU