A STUDY ON WORKING CAPITAL

APPRAISAL IN
ST-CMS ELECTRICALS PVT.LTD,
CHENNAI
A MINI PROJECT REPORT
Submitted to the
SRM SCHOOL OF MANAGEMENT

By

B.GOPALAKRISHNAN
(Reg.No.3511110291)

Under the guidance of

Dr.A.ChandraMohan

DECLARATION

I hereby declare that this project report entitled A Study

on Working Capital Appraisal in ST-CMS ELECTRIC
COMPANY PVT.LTD, Chennai submitted to SRM School of
Management in Partial fulfillment for theaward of the
Degree of Master of Business Administration under the
guidance of Dr.A.Chandramohan, is original and not
copied from any earlier reports. The findings and
conclusions of this report are based on the information
collected by me.
I further declare that this project report has not
formed a basis for the award of any Degree of any award
of any University or Institution.

CONTENTS

CHAPTER NO.
PAGE NO.

PARTICULARS

INTRODUCTION

2.

ORGANISATIONAL PROFILE

3.

RESEARCH METHADOLOGY

4.

DATA ANALYSIS & INTERPRETATION

5.
CAPITAL

SCHEDULE OF CHANGES IN WORKING

6.

FINDINGS AND SUGGESTIONS

7.

COMMON SIZE BALANCE SHEET

8.

CONCLUSION

LIST OF TABLES

TABLE NO.
PAGE NO.

1.
2.
LIABILITIES

PARTICULARS

COMPOSITION OF CURRENT ASSETS

COMPOSITION OF CURRENT

3.

NET WORKING CAPITAL

4.

CURRENT RATIO

5.

WORKING CAPITAL TURNOVER RATIO

6.

DEBTORS TURNOVER RATIO

7.

STOCK TURNOVER RATIO

8.
RATIO
9.

CURRENT ASSETS TO TOTAL ASSETS

NET OPERATING PROFIT RATIO

CHARTS

TABLE NO.
PAGE NO.

PARTICULARS

1.

NET WORKING CAPITAL

2.

CURRENT RATIO

3.

WORKING CAPITAL TURNOVER RATIO

4.

DEBTORS TURNOVER RATIO

5.

STOCK TURNOVER RATIO

6.

CURRENT ASSET TO TOTAL ASSET RATIO

7.

NET OPERATING PROFIT RATIO

INTRODUCTION

WORKING CAPITAL
MANAGEMENT

MEANING ::
Working capital means the funds available for
day operation of an enterprise. Flow means change.
Funds is interpreted as Working Capital in the context
of fund flow statement. Thus Funds Flow is Change in
Working Capital. These changes are a continuous
process, day after day, as and when transaction takes
place. So the changes in working capital may be called as
flow. It can be Inflow or Outflow of working capital.
CONCEPT OF WORKING CAPITAL ::
There are two concepts of working capital::
1. Gross Working Capital
2. Net Working Capital
GROSS WORKING CAPITAL ::
Gross working capital refers to the firms total
investment In current asset only and it may represent
both owned as well as loan capital used for financing the
current assets.
NET WORKING CAPITAL ::

Net working capital means the difference

between current assets and current liabilities and when
asset exceed the current liabilities, then the working
capital is positive and the negative capital is suitable for
proprietary organization.
CLASSIFICATION OF WORKING CAPITAL
They are as follows
1. Permanent Working Capital
2. Temporary Working Capital
PERMANENT WORKING CAPITAL
It is required by a business to maintain
minimum levels of stock of raw materials, semimanufacture and manufacture products and to pay
expenses such as wages, salaries, rents, interests etc.
TEMPORARY WORKING CAPITAL
The amount of temporary or variable working
capital will depend on when and what purpose is needed
by the company.

ORGANISATIONAL
PROFILE

HISTORY OF THE COMPANY ::

ST-CMS Electric Company Pvt. Ltd. (ST-CMS) has set
up a 250 MW Lignite fired Power Plant at Neyveli,
adjacent to the existing power stations of Neyveli Lignite
Corporation (NLC) at Cuddalore district in Tamil Nadu. STCMS is a Joint Venture between CMS Generation Neyveli
Ltd., a Mauritius based wholly owned subsidiary of CMS
Generation Company, USA and ABB Equity Ventures
(ABBEV), Netherlands through its subsidiary ABB Power
Investment (India) BV (ABBPI), Netherlands. ST-CMS is
one of the Fast Track counter-guaranteed power projects .
PROFILE OF THE COMPANY
In order to take advantage of the new liberalised
policy, NLC offered the Zero Unit Project, a 250 MW lignite
fired power plant to the Private Sector. The Government
of India, through Ministry of Coal (MOI) decided to permit
ST Power System (STP) to build, own and operate the zero
unit project, based on which NLC vide their letter dated
22.05.92 permitted STP to establish a 210 MW (1*210)
power station at Neyveli. On 17th November 1993, STP
incorporated ST-CMS as the Project Company and
transferred its rights and interests in the project to the
project company. Subsequently, TNEB vide their letter
dated 03.02.94 and Energy Department, Government of
Tamil Nadu (GoTN)wide their letter dated 18.05.94
enhanced the project size to 250 MW (1*250).The project
was originally developed by S.T.Power Systems Inc.,
(STP), USA and CMS Generation. Subsequently the rights
of STP were acquired by ABBEV.

A Memorandum of Agreement between ABBEV and

CMS Generation for joint development of the project was
signed on 4th March 1998. ST-CMS signed a 30-year
Power Purchase Agreement (PPA) with TNEB on 20th
November 1996, to sell the power generated by the plant
which will operate as a base load station. A 30year
Operations & Maintenance (O & M) agreement has been
signed with CMS India Operations & Maintenance
Company Pvt. Ltd., a CMS group company.
The Construction of the project
commenced on 19th November 1999and the project
achieved Commercial Operation on 15 December
2002.The 720-hour performance test has also been
completed on 17th April2003. ST-CMS is the first thermal
IPP to commence operations in India and utilises low cost
domestic coal (lignite) as fuel. For the period ended
March 2003, ST-CMS sold 1,882 MU of electricity to TNEB.
The completed project cost, excluding margin money,
stands at Rs. 1,389.54 crore, which is lower than the
initial estimates of lenders of approx Rs 1,417 crore. The
cost is pending approval of the Central Electricity
Authority. The project cost has been financed with a
debt: equity ratio of 2.33:1

GENERAL PARTICULARS OF THE PROJECT COMPANY

Name of
company

the ST-CMS Electric Company Pvt. Ltd.

(ST-CMS)

Date
of 17th November 1993
Incorporation
Registered
Uthangal Village, Umangalam Via,
Office & Site Vridhachalam
Taluk,
Cuddalore
Location
District, Tamil Nadu 607 804.
Corporate
Office

Oxford Centre, I Floor, 66, C.P.

Ramaswamy
Road,
Alwarpet,
Chennai 600 018

Shareholding

CMS Generation Neyveli Limited,

Mauritius: 50%
ABB Power Investment (India) B.V.
Netherlands: 50%

OBJECTIVES OF THE STUDY:

To interpret the profitability and efficiency of the STCMS Electric company pvt Ltd.
To conduct a financial analysis of ST-CMS Electric
company pvt Ltd.chennai.

To reveal the financial positions of the firm and the

soundness of Business by comparing its assets,
liabilities and capital side by side Assess how far the
overall financial performance of the company has
Improved.
LIMITATIONS OF THE STUDY:
1.Financial analysis is subjected to certain limitations
and most of them are because of the limitation of
the financial statement themselves.
2.The accuracy and reliability of analysis depends on
reliability of manipulated, analysis based on these
figures will be misleading or meaningless.
3.Financial statements do not depict those facts,
which cannot be
expressed in terms of money.

RESEARCH METHODOLOGY

RESEARCH
Research is the process of systematic and indepth study of any Particular topic, subject or area of
investigation, backed by collection, complication,
presentation and interpretation of relevant details or
data.
RESEARCH DESIGN:
A Research design is a specification of
methods and procedures for acquiring the information
needed to structure or to solve problems. It is overall
operational pattern or framework of the project that
stipulates what information needed to be collected from
which sources and what procedures. The comparative
study on financial solvency of non-banking financial
companies done in the non-banking industries on the
basis of annual report issued by the company for the
period from 2009-2011.
SOURCE OF DATA
All the data are collected from company
annual report from 2009-2011.
FINANCIAL TOOLS::
1. Common size balance sheet analysis.
2. Schedule of changes in working capital.
3. Working capital analysis.

These tools applied on the

information available in the annual report to have a clean
idea about the financial status of the companies.
FINANCIAL ANALYSIS::
Financial analysis is the process of
identifying the strength and weakness of the firm by
properly establishing the relationship between the items
of the balance sheet and profit and loss account. Financial
statement analysis may be described as a critical
examination of financial transaction effected during a
definite period of time.
According to MYES financial statement
analysis is largely a study of the relationship among the
various financial factors in a business as disclosed by a
single statements and a study of trend of these factors as
shown in series statements.
Financial statement analysis covers both
analysis and interpretation. As they both are
complimentary. Analysis means methodical classification
of data given in financial statements. The term
interpretation means explaining the meaning and
signification ofdata so simplified. However both analysis
and interpretation are complementary to each other.
Interpretation requires analysis where as analysis will not
be useful without interpretation.
COMMON SIZE FINANCIAL STATEMENTS::

Common size financial statement indicates

the relationship of various items with some common
items expressed as percentage of common item. In the
balance sheet the total assets and liabilities are taken as
base and all other figures are expressed as percentage of
this total. The percentage so calculated is compared with
corresponding percentage in other periods or other firms
and meaningful conclusion are drawn.

WORKING CAPITAL ANALYSIS::

Net working capital statement is prepared to
disclose the net change on working capital on two or
more specific data. It is prepared from current assets and
current liabilities on the specific dates to show net
increase or decrease in working capital. Net working
capital represents the excess of current asset over
current liabilities. The term current assets refer to the
normal course of business gets converted into cash
without diminution in value over a short period, usually
not exceeding one year or the operating cash cycle
whichever in more. Current liabilities are those, which has
to be short period normally within one year. This business
concern should have enough Net Working Capital to meet
the short-term obligation and day operations. The greater
is the networking greater is the networking greater is the
liquidity of the firm.

DATA

ANALYSIS

&

A
STUDY
ON
MANAGEMENT OF

INTERPRETATION

WORKING

CAPITAL

ST-CMS ELECTRIC COMPANY

PVT.LTD
COMPOSITION OF CURRENT ASSETS AND CURRENT
LIABILITIES::
The study of working capital deals current assets
and current liabilities. So it is best to know how current
assets and current liabilities are made up.
TABLE 1.1
COMPOSITION OF CURRENT ASSETS (RS IN
CRORES)
YEARS

INVENTORIES

SUNDRY CASH AND LOANS

DEBTORS BANK
AND
BALANCES ADVANCES

TOTAL

31/3/2011 462.91

2003.74

17.97

603.92

3088.54

31/3/2010 424.9

23.86

745.06

308.69

1502.51

31/3/2009 424.67

296.46

510.87

307.65

1539.65

Mean

437.49

774.68

424.63

406.75

2043.58

Mean
proportio
n

21.40%

37.90%

20.77%

19.90%

100%

INTERPRETATION::

From the table it is clear that value of the sundry

debtors is the highest among all the current assets. It is
followed by inventories, cash and bank balances and
loans and advances.
TABLE 1.2
COMPOSITION OF CURRENT LIABILITIES
(RS IN CRORES)

YEAR

LIABILIT PROVISI
IES
ONS
31/3/20 1539.19
18.39
11
31/3/20
387
806.83
10
31/3/20 272.67
697.33
09
Mean
732.95
507.51
Mean
proport
ion
%

59.08

TOT
AL
1557.
58
1193.
83
970
1240.
47

40.91
%

100
%

INTERPRETATION::
This table clearly indicates that provisions make
up only a very small amount of the current liabilities. The
major proportion is covered by liabilities (sundry
creditors, bills payable).

NET WORKING CAPITAL::

The excess current asset over current
liabilities is the net working capital. The following table
shows the net working capital of ST- CMS ELECTRIC
PVT.LTD. for the past three years.

TABLE NO 1.3
NET WORKING CAPITAL (RS IN
CRORES)
YEARS

CURRENT
ASSETS

CURRENT
LIABILITIES

31/3/2011

3088.54

1557.58

31/3/2010

1502.51

1193.83

308.68

31/3/2009

1539.65

970

569.65

Mean

2043.56

1240.47

NET
WORKING
CAPITAL
1530.96

803.09

FIGURE 1.1
NET WORKING CAPITAL
3500
3000
2500
CURRENT ASSETS

2000

CURRENT LIABILITY
1500

NET WORKING
CAPITAL

1000
500
0
31/3/201131/3/201031/3/2009

MEAN

INTERPRETATION::
From the above table it can be seen that the
net working capital for the 3 years is fluctuating. The net
working capital is high in the year 2011. The net working

capital is always positive in nature, i.e., current assets are

always more than current liabilities.

WORKING CAPITAL OF ST-CMS ELECRIC COMPANY

PVT LTD:
AN APPRAISAL
The most common purpose of working capital
analysis is to evaluate liquidity, solvency, financial
efficiency and cost of financing.
The major tool used for analyzing working
capital position of the company is
1. Schedule or statement of change in working
capital.
2. Common size balance sheet.
3. Working capital ratio.
A.LIQUIDITY RATIO:
These ratios are used to judge a company to
meet short-term obligations. These can also be called
working capital ratios. By calculating this ratio,
much insight can be obtained in to the present
solvency of the company and its ability to remain
solvent in event of adversities. Some of the most
general and frequency used liquid ratios are:
1.CURRENT RATIO:
This ratio expresses the relationship
between current assets and current liabilities. The
ratio is an indication of the companys ability to meet
its short-term liabilities. It is the ratio of current
assets and current liabilities. This means that every

current liability should be covered by atleast twice

the amount of current assets.
Current Ratio= current Assets
current Liabilities
TABLE NO 1.4
CURRENT RATIO(RS IN
CRORES)
YEARS

CURRENT
ASSETS

CURRENT
LIABILITIES

CURRENT
RATIOS

31/3/2011

3088.54

1557.58

1.98:1

31/3/2010

1502.51

1193.83

1.25:1

31/3/2009

1539.65

970

1.58:1

Mean

2043.56

1240.47

1.64:1

FIGURE 1.2
CURRENT RATIO

3500
3000
2500
2000
1500
1000
500
0
YEARS

31/3/2011 31/3/2010 31/3/2009

INTERPRETATION::

MEAN

B.TURN OVER RATIOS::

The turnover ratio indicates the efficiency
with the capital employed is rotated in the business. They
are also known as Activity Ratios, Performance Ratios
or Efficiency Ratio. With these ratios,it is easy to judge
how well facilities at the disposal of the concern are being
used. In other words, these ratios help in judging the
efficiency of the company.
These ratios are usually calculated on the
basis of sales or cost of sales and are expressed in
integers rather than in percentage. Such ratios should be
calculated separately for each type of assets. Higher the
turnover ratio, better the profitability and use of capital or
resources will be. The following are the important ratios
1. WORKING CAPITAL TURN OVER RATIO
This turnover ratio indicates the number of
working capital in the company. This ratio indicates
whether the working capital has been used effectively or
not. It expresses the number of times; a unit invested in
working capital which produces sales. It is calculated by
dividing the net sales by net working capital. It helps in
measuring the efficiency of working capital. Generally the
higher the turnover the efficiency and larger the rate of
profits. However, a very high high ratio may signify the
dangerous situation of the shortage of working capital.
Working capital turnover ratio gives us a
better and whole picture of efficiency than stock or

inventory turnover ratio. This is because the amount

invested in stock is only a part of working capital.

Working capital turnover ratio =

sales
Net working capital

TABLE 1.6
WORKING CAPITAL TURNOVER
RATIO

YEARS

NET SALES

NET
WORKING
CAPITAL

31/3/2011

6642.91

1530.96

WORKING
CAPITAL
TURNOVER
RATIO
4.33 Times

31/3/2010

5595.42

308.68

18.12 Times

31/3/2009

5612.77

569.65

9.85Times

Mean

5950.36

803.09

7.40Times

FIGURE 1.4
WORKING CAPITAL TURNOVER
RATIO

Sales

31/3/2011
31/3/2010
31/3/2009
MEAN

INTERPRETATION::

2.DEBTORS TURN OVER RATIO

Debtors are an important constituent of
current asset and therefore the quality of debtors to a
great extent determines the companys liquidity and
efficiency of the company. The debtors turnover ratio
indicates the number of times on the average that
debtors turnover each year. Generally, higher the value
of debtors turnover, the more efficient is the credit
management.
Debtors Turnover Ratio = Total Sales
Debtors
TABLE 1.7
DEBTORS TURNOVER RATIO
YEARS

TOTAL SALES DEBTORS

31/3/2011

6642.91

31/3/2010

5595.42

23.86

31/3/2009

5612.77

296.46

MEAN

5950.36

774.68

2003.74

DEBTORS
TURN OVER
RATIO
3.31
TIMES
234.51
TIMES
18.93
TIMES
7.68
TIMES

FIGURE 1.5
DEBTORS TURNOVER RATIO

Sales
1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

9%
10%

23%

INTERPRETATION::

59%

STOCK OR INVENTORY TURNOVER RATIO

The ratio indicates whether investments in
inventories are efficiently used or not. It is whether
investment in stock is within proper limits or not. This
ratio provides a relationship between net sales and
amount of stock.
stock turnover ratio = Net sales
Stock/ Inventory
TABLE 1.8
STOCK TURNOVER RATIO
(RS IN CRORE)
YEARS

NET SALES

STOCK/INVENT
ORY

31/3/2011

6642.91

462.91

STOCK
TURNOVER
RATIO
14.35 TIMES

31/3/2010

5595.42

424.90

13.16 TIMES

31/3/2009

5612.77

424.67

13.21 TIMES

MEAN

5950.36

437.49

13.60 TIMES

INTERPRETATION::

The average stock turnover ratio is 13.60

times, i.e. stock is turned over 14.35 times during an
accounting period. The higher the stock turnover ratio,
the better is for the company, because more frequently
the stocks are sold, the lesser amount of money is
required to finance inventory.
The average time taken for clearing the
stock can be known by calculating inventory conversion
period. The inventory conversion period has an influence
on stock turnover ratio.
Average inventory conversion
Period for the period understudy = Number of days in a
year
Avg. inventory
turnover ratio
= 365
13.60
= 27 days
FIGURE 1.5

6
5
4
NET SALES

STOCK/INVENTORY
STOCK TURNOVER RATIIO

2
1
0
31/3/2009

31/3/2010

31/3/2011

MEAN

C. FINANCIAL RATIOS::
It gives an idea about the financial
position of the company. A company said to be financially
sound if it is in a position tocarry on its business smoothly
and meet all its obligation in time. These ratios are
calculated to judge the solvency of the concern.
1.CURRENT ASSET TO TOTAL ASSET RATIO
This ratio is found to know the
proportion of current assets in total asset. There should
always be a reasonable amount of current asset in the
company.
TABLE 1.9

CURRENT ASSETS TO TOTAL ASSETS

RATIO(RS IN CRORE)
YEARS

CURREN
T
ASSETS

31/3/2011
31/3/2010
31/3/2009
MEAN

3088.54
1502.51
1539.65
2043.58

TOTAL CURRENT
ASSETS ASSETS
TO
TOTAL ASSETS
3367.53
0.91:1
1769.42
0.84:1
1713.73
0.89:1
2283.56
0.89:1

FIGURE 1.6
CURRENT ASSET TO TOTAL
ASSETS RATIO

6
5
4
CURRENT ASSETS
3

TOTAL ASSETS
CURRENT ASSETS TO
TOTAL ASSETS

2
1
0
MEAN

31/3/2009

31/3/2010

31/3/2011

INTERPRETATION
The current assets contribute very low of the
total assets in all years. But still its short-term obligations
and to get money from the lenders should show liquidity.
For this purpose current assets should be maintained at a
satisfactory level throughout the year.

D.PROFITABILITY RATIO::

It is an indication of the efficiency with

which the operation of the business is carried on. A lower
profitability may arise due to lack of control over the
expenses. Creditors will look at the profitability ratios as
an indication of whether the company earns or not the
substantially more than which the ultimate repayment of
their debts for the use of borrowed funds and whether the
ultimate repayment of their debts appears reasonably
certain. Owners are interested to know the profitability as
it indicates the return which they can get on their
investments. The following are the important profitability
ratios::
1.NET PROFIT RATIO
This ratio measure the art of net profit
earned on scales. It is also called as net profit to sales
ratio. The profit is called income from non-trading assets
and expenses.
Higher the net profit ratio, better is for the
company, some companies calculate the net profit after
deducting the tax payable on the net profit. It can be
calculated by sales.
Net profit ratio = Net operating profit
*100
Sales

TABLE 1.09
NET OPERATING PROFIT RATIO (RS IN
CRORES)
YEARS

31/3/2011
31/3/2010
31/3/2009
Mean

NET
OPERATING
PROFIT
48.20
75.51
55.22
178.93

SALES

6642.91
5595.42
5612.77
5950.36

NET
OPERATING
RATIO
0.72%
1.34%
0.98%
3.00%

FIGURE 1.8
NET OPERATING PROFIT
RATIO

5
4.5
4
3.5
3

NET OPERATING PROFIT

2.5

SALES
NET OPERATING RATIO

2
1.5
1
0.5
0
31/3/2009

31/3/2011

INTERPRETATION::

31/3/2010

MEAN

SCHEDULE OF CHANGES IN
WORKING CAPITAL

STATEMENT OF SCHEDULE
WORKING CAPITAL::

OF

CHANGES

IN

It is prepared to analyze the changes

in working capital between the two balance sheets. This
statement is prepared with the help of current assets and
current liabilities derived from two balance sheets.
The difference in the amount of current
assets or current liabilities in the current balance sheet as
compared to that of the previous balance sheet is
recorded. Increase in the current assets cause an
increase in working capital and vice-versa. The total
increase or decrease is compared and the difference
shows net increase or decrease in working capital.

PARTICULA 2009-2010 2010-2011 INCREASE

RS
CURRENT
ASSET
INVENTORI
ES

424.90

462.91

23.86

2003.74

CASH AND
BANK
BALANCES

745.06

17.97

LOANS
AND
ADVANCES

308.69

603.92

SUNDRY
DEBTORS

TOTAL (A)

1502.51

3088.54

387.00

1539.19

DECREASE

38.01
1979.88
727.09

295.23

CURRENT
LIABILITY
AND
PROVISION
S
LIABILITIE
S

PROVISION 806.83
S

18.39

TOTAL (B)

1557.58

1193.83

WORKING 308.68
CAPITAL(AB)

1530.96

1152.19
788.44

INCREASE
IN
WORKING
CAPITAL

1222.28

TOTAL

1530.96

1530.96

1222.28

3101.56

3101.56

FINDINGS AND
SUGGESTION

SUMMARY OF FINDINGS AND SUGGESTION

COMPOSITION OF WORKING CAPITAL::
The main constituents of current assets
for the period are Inventories (21.40%), sundry debtors
(37.90%), loans andadvances (19.90%), cash and bank
balances (20.77%), and current liabilities are formed
59.08% by liabilities and 40.91% by provisions.
LIQUIDITY OF WORKING CAPITAL::
The liquidity position of the company is
measured by the following methods:
The current ratio of the company
reveals that there are sufficient current assets to pay its
current liabilities as and when they are due. The average
current ratio for the period under the study meets the
hypothetical norm of 2:1.
The liquid ratio of the company has
always been above conventional norm of 1:1.
The cash position ratio of the company
is always above the standard norm, the cash and bank
balances maintained by the company are satisfactory.
Net working capital for the period
under study is standard. The working capital is positive in
nature.

EFFICIENCY OF WORKING CAPITAL ::

Ratio of sales to working capital
elucidates that the working capital turnover ratio of the
company was quite good during the entire period of
study.
The company has considerably long
collection period. It implies a very several credit and
collection performance. This certainly delays the
collection of cash and impairs the liquidity position.
Generally, higher the value of debtors turnover ratio, the
more efficient is the credit management.
PROFITABILITY OF THE COMPANY::
The profitability ratio reveals that
there has been consistent increase.
The statement of working capital
shows that the working capital shows that the company
has sufficient working capital during all the years of study.
The overall financial position of the
company is moderate and standard.

COMMON SIZE BALANCE

SHEET

COMMON SIZE BALANCE SHEET::

PARTICULARS

1.SOURCES
OF
FUNDS
Share
Holders
funds
Share capital
Reserves & surplus
Loan Funds:
Secured loans
Unsecured loans
Deferred
tax
liability
2.APPLICATION
OF FUNDS:
Fixed assets
Gross block
Less: Depreciation
Net block
Capital
work-inprogress
TOTAL (A)
Current assets,
loans
and
advances
Inventories
Sundry debtors
Cash
and
bank
balances
Loans
and
advances

2009-2010

2010-2011

4004.92
732.56

4004.92
1699.69

4740.00
23.78
909.65

4308.23
7.86
1020.73

10410.91

11041.43

9833.49
1.83

9181.87
49.61

9835.32

9231.48

424.90
23.86
745.06

462.91
2003.74
17.97

308.69

603.92

Other
current
assets
TOTAL (B)
Less: current
liabilities
and
provisions
Current liabilities
provisions
TOTAL (C)
TOTAL (B-C)
TOTAL (D)
TOTAL (A+D)

266.91

278.99

1769.42

3367.53

387.00
806.83
1193.83
575.59
575.59
10410.91

1539.19
18.39
1557.58
1809.95
1809.95
11041.43

INTERPRETATION::
1.The share capital of the company 4004.92 is same for
both the years 2009-2010, 2010-2011.
2.The reserves and surplus of the company was 732.56 in
the year 2009-2010 and it has increased to 1699.69 in
the year 2010-2011.
3.The secured loans of the company were 4740.00 in the
year 2009-2010. And it was decreased by 4308.23 in the
year 2010-2011.
4.The unsecured loan of the company was 23.78 in the
year 2009-2010. And it was decreased to 7.86 in the year
2010-2011.
5.The fixed assets were 1.83 in the year 2009-2010.And it
has increased by 49.61 in the year 2010-2011.

6.The sundry debtors were 23.86 in the year 2009-2010.

And it has increased 2003.74 in the year 2010-2011.
7.The cash and bank balances were 745.06 in the year
2009-2010. And it has decreased to 17.97 in the year
2010-2011.
8.The net profit before tax of the company was RS
2383.86 in the year 2009-2010. And it has decreased to
1025.85 in the year 2010-2011.

CONCLUSION

CONCLUSION::
Finance is the main part of the business. The
funds have to be properly utilized for both long run and
short run profitability of the firm.
The study was conducted to financially
analyse the performance of the ST-CMS ELECTRIC
company pvt. Ltd by applying effective financial tools.
The objectives set for the project is
achieved successfully through the methodology. The
analysis is done and analyzed data are interpreted so as
to achieve the objectives.

BIBLIOGRAPHY

BIBILOGRAPHY
1.MANAGEMENT ACCOUNTING :: T.S. REDDY,

Y.

HARIPRASAD REDDY
2. FINANCIAL MANAGEMENT

:: R.L. GUPTHA