A STUDY ON CASH MANAGEMENT ANAIYSIS IN SRI ANGALAMMAN

FINANCE LTD

CHAPTER I

INTRODUCTION

Cash is the important current asset for the operations of the business. Cash is the basic
input needed to keep the business running on a continuous basis; it is also the ultimate output
expected to be realized by selling the service or product manufactured by the firm. The firm
should keep sufficient cash, neither more nor less. Cash shortage will disrupt the firm’s
manufacturing operations while excessive cash will simply remain idle, without contributing
anything towards the firm’s profitability. Thus, a major function of the financial manager is to
maintain a sound cash position.

Cash is the money which a firm can disburse immediately without any restriction. The term
cash includes coins, currency and cheques held by the firm, and balances in its bank accounts.
Sometimes near-cash items, such as marketable securities or bank times deposits, are also
included in cash. The basic characteristic of near-cash assets is that they can readily be
converted into cash. Generally, when a firm has excess cash, it invests it in marketable
securities. This kind of investment contributes some profit to the firm.
 1.2 INTRODUCTION ABOUT THE INDUSTRY

The Indian money market is classified into: the organised sector (comprising private,
public and foreign owned commercial banks and cooperative banks, together known
as scheduled banks); and the unorganised sector (comprising individual or family owned
indigenous bankers or money lenders and non-banking financial companies (NBFCs)).
The unorganised sector and microcredit are still preferred over traditional banks in rural
and sub-urban areas, especially for non-productive purposes, like ceremonies and short
duration loans.[2]

Prime Minister Indira Gandhi nationalised 14 banks in 1969, followed by six others in
1980, and made it mandatory for banks to provide 40% of their net credit to priority
sectors like agriculture, small-scale industry, retail trade, small businesses, etc. to ensure
that the banks fulfill their social and developmental goals. Since then, the number of bank
branches has increased from 10,120 in 1969 to 98,910 in 2003 and the population
covered by a branch decreased from 63,800 to 15,000 during the same period. The
total deposits increased 32.6 times between 1971 and 1991 compared to 7 times between
1951 and 1971. Despite an increase of rural branches, from 1,860 or 22% of the total
number of branches in 1969 to 32,270 or 48%, only 32,270 out of 500,000 villages are
covered by a scheduled bank.[3][4]

Since liberalisation, the government has approved significant banking reforms. While
some of these relate to nationalised banks (like encouraging mergers, reducing
government interference and increasing profitability and competitiveness), other reforms
have opened up the banking and insurance sectors to private and foreign players.[5][6]

As of 2007, banking in India is generally mature in terms of supply, product range and
reach-even, though reach in rural India still remains a challenge for the private sector and
foreign banks.[7] In terms of quality of assets and capital adequacy, Indian banks are
considered to have clean, strong and transparent balance sheets relative to other banks in
comparable economies of Asia.[7] The Reserve Bank of India is an autonomous body,
with minimal pressure from the government. The stated policy of the Bank on the Indian
Rupeeis to manage volatility but without any fixed exchange rate.[8]

FINANCIAL GROWTH IN 2018:

ndia has a diversified financial sector undergoing rapid expansion, both in terms of strong
growth of existing financial services firms and new entities entering the market. The sector
comprises commercial banks, insurance companies, non-banking financial companies, co-
operatives, pension funds, mutual funds and other smaller financial entities. The banking
regulator has allowed new entities such as payments banks to be created recently thereby adding
to the types of entities operating in the sector. However, the financial sector in India is
predominantly a banking sector with commercial banks accounting for more than 64 per cent of
the total assets held by the financial system.
The Government of India has introduced several reforms to liberalise, regulate and enhance this
industry. The Government and Reserve Bank of India (RBI) have taken various measures to
facilitate easy access to finance for Micro, Small and Medium Enterprises (MSMEs). These
measures include launching Credit Guarantee Fund Scheme for Micro and Small Enterprises,
issuing guideline to banks regarding collateral requirements and setting up a Micro Units
Development and Refinance Agency (MUDRA). With a combined push by both government and
private sector, India is undoubtedly one of the world's most vibrant capital markets. In 2017,a
new portal named 'Udyami Mitra' has been launched by the Small Industries Development Bank
of India (SIDBI) with the aim of improving credit availability to Micro, Small and Medium
Enterprises' (MSMEs) in the country. India has scored a perfect 10 in protecting shareholders'
rights on the back of reforms implemented by Securities and Exchange Board of India (SEBI).
Market Size
The Mutual Fund (MF) industry in India has seen rapid growth in Assets Under Management
(AUM). Total AUM of the industry stood at Rs 24.03 trillion (US$ 342.01 billion) between
April-November 2018. At the same time the number of Mutual fund (MF) equity portfolios
reached a high of 74.6 million as of June 2018.
Another crucial component of India’s financial industry is the insurance industry. The insurance
industry has been expanding at a fast pace. The total first year premium of life insurance
companies reached Rs 193,866.23 crore (US$ 30.10 billion) during FY18.
Along with the secondary market, the market for Initial Public Offers (IPOs) has also witnessed
rapid expansion. The total amount of Initial Public Offerings (IPO) increased to US$ 1.2 billion
raised from 37 between April – June 2018.
Over the past few years India has witnessed a huge increase in Mergers and Acquisition (M&A)
activity. In H12018, 74 deals of acquisition took place in financial sector. The total value of such
transactions was US$ 4.166 billion. *
Furthermore, India’s leading bourse Bombay Stock Exchange (BSE) will set up a joint venture
with Ebix Inc to build a robust insurance distribution network in the country through a new
distribution exchange platform.
Investments/Developments

 Investments by Foreign Portfolio Investors (FPIs) in Indian capital markets have reached
Rs 6,310 crore (US$ 899.12 million) up to November 22, 2018.
 As of October 2018, the Financial Inclusion Lab has selected 11 fintech innovators with
an investment of US$ 9.5 million promoted by the IIM-Ahmedabad's Bharat Inclusion
Initiative (BII) along with JP Morgan, Michael and Susan Dell Foundation, and the Bill
and Melinda Gates Foundation.
 The private equity and venture capital (PE/VC) investments reached US$ 25.20 billion
between January to October 2018.*

Government Initiatives

 In December, 2018, Securities and Exchange Board of India (SEBI) proposed direct
overseas listing of Indian companies and other regulatory changes.
  Bombay Stock Exchange (BSE) introduced weekly futures and options contracts on
Sensex 50 index from October 26, 2018.
 In September 2018, SEBI asked for recommendations to strengthen rules which will
enhance the overall governance standards for issuers, intermediaries or infrastructure
providers in the financial market.
 The Government of India launched India Post Payments Bank (IPPB), to provide every
district with one branch which will help increase rural penetration. As of August 2018,
two branches out of 650 branches are already operational.

Road Ahead

 India is today one of the most vibrant global economies, on the back of robust banking
and insurance sectors. The relaxation of foreign investment rules has received a positive
response from the insurance sector, with many companies announcing plans to increase
their stakes in joint ventures with Indian companies. Over the coming quarters there
could be a series of joint venture deals between global insurance giants and local players.
 The Association of Mutual Funds in India (AMFI) is targeting nearly five fold growth in
assets under management (AUM) to Rs 95 lakh crore (US$ 1.47 trillion) and a more than
three times growth in investor accounts to 130 million by 2025.
 India's mobile wallet industry is estimated to grow at a Compound Annual Growth Rate
(CAGR) of 150 per cent to reach US$ 4.4 billion by 2022 while mobile wallet transactions to touch Rs 32 trillion
(USD $ 492.6 billion) by 2022.

FINANCAL SERVICES:
Figure 2.8
1.3 COMPANY PROFILE
Sri sakthi finace ltd was registered under the state co operative’s law, on 25 th October 1988 and started
its work on 4th November in the same year..Sri murgan credits has 4182 members who have the voting
power and 30 non members. Co-operative society gets funds from following ways.

 By getting deposits from members of the firm

 Borrow needed funds from co-operative firm and state cooperative firm.
 Using retained earnings from profit
 By getting interest from karur district central co-operative firm where the surplus fund is
deposited.

Objectives:

The following are the objectives of Sri murgan credits.

 To get deposits from members and non-members

 To provide short term and middle term loans
 To sell agri related products to farmers
 To rent the agricultural equipments to farmers

MANAGEMENT:

At present there are 7 staffs have been working:

1. 1 secretary
2. 1 Asst secretary
3. 2 PDS salesman
4. 1 Clerks

PRODUCTS AVAILABLE IN THE FIRM:

1. AVAILABLE LOAN PRODUCTS:

 Crop loan
 Jewel loan
 SHG (self Help Group Loan)
 Small Industries Loan

INTEREST RATE FOR DEPOSITS:

 Savings Deposit:
Interest rate for savings deposit is 4%

 Fixed Deposits:
Interest rate for fixed deposits is based on the deposit days. It has two types of fixing interest
rates.

 General

Days General Old age people

15 to 45 4.5% 4.5%

46 to 179 6% 6%

180 to 364 8% 8.5%

1 year and above 9% 9.5%

3 year and above 8% 8.5%

1.4 NEED FOR THE STUDY

The importance of Cash management in any industrial concern cannot be

overstressed. Under the present inflationary condition, management of Cash is perhaps more
important than even management of profit and this requires greatest attention and efforts of the
finance manager. It needs vigilant attention as each of its components require different types of
treatment and it throws constant attention on exercise of skill and judgment, awareness of
economic trend etc, due to urgency and complicacy the vital importance of Cash.

The anti-inflationary measure taken up by the Government, creating a tight money

condition has placed working capital in the most challenging zone of management and it requires
a unique skill for its management. Today, the problem of managing Cash has got the recognition
of separate entity, so its study and management is of major importance to both internal and
external analyst to judge the current position of the business concerns. Hence, the present study
entitled “An Analysis on Cash Management” has been taken up.

1.5 OBJECTIVES OF THE STUDY :

 Primary Objective:

• To analyze the cash management of sky cotex.

 Secondary Objective:
 • To find out the liquidity position of the concern through ratio analysis.
• To study the growth of sri Angalamman finance ltdin terms of cash flow statement.
• To make suggestion and recommendation to improve the cash position of sky cotex.

1.6 SCOPE OF THE STUDY

 It helps to take short term financial decision.

 It indicates the cash requirement needed for plant or equipment expansion

programmes.

 To find strategies for efficient management of cash.

 It helps to arrange needed funds on the most favourable terms.

 It helps to meet routine cash requirement to finance the transaction.

 It reveals the liquidity position of the firm by highlighting the various sources of
cash and its uses.
1.7 LIMITATIONS OF THE STUDY
  The study is restricted only to SRI ANGALAMMAN FINANCE LTDS. Being
a case study, the findings cannot be generalized.

 The study does not take into account the inflation.

 The study takes into account only the quantitative data and the qualitative
aspects were not taken into account

CHAPTER II

REVIEW OF LITERATURE

Meaning:
Cash is the money which a firm can disburse immediately without any restriction. The
term cash includes coins, currency and cheques held by the firm, and balances in its bank
accounts. Sometimes near-cash items, such as marketable securities or bank times deposits, are
also included in cash. The basic characteristic of near-cash assets is that they can readily be
converted into cash.

FACETS OF CASH MANAGEMENT:

 Cash management is concerned with the managing of: (i) Cash flows into and out of the
firm, (ii) Cash flows within the firm, and (iii) Cash balances held by the firm at a point of time
by financing deficit or investing surplus cash. It can be represented by a cash management cycle.
Sales generate cash which has to be disbursed out. The surplus cash has to be invested while
deficit this cycle at a minimum cost. At the same time, it also seeks to achieve liquidity and
control. Cash management assumes more importance than other current assets because cash is
the most significant and the least productive asset that a firm’s holds. It is significant because it
is used to pay the firm’s obligations. However, cash is unproductive. Unlike fixed assets or
inventories, it does not produce goods for sale. Therefore, the aim of cash management is to
maintain adequate control over cash position to keep the firm sufficiently liquid and to use flows
accurately, particularly the inflows, and there is no prefect coincidence between the inflows and
outflows of cash. During some periods, cash outflows will exceed cash inflows, because
payments for taxes, dividends, or seasonal inventory build up. At other times, cash inflow will
be more than cash payments because there may be large cash sales and debtors may be realized
in large sums promptly. Further, cash management is significant because cash constitutes the
smallest portion of the total current assets, yet management’s considerable time is devoted in
managing it. In recent past, a number of innovations have been done in cash management
techniques. An obvious aim of the firm these days is to manage its cash affairs in such a way as
to keep cash balance at a minimum level and to invest the surplus cash in profitable investment
opportunities.

In order to resolve the uncertainty about cash flow prediction and lack of synchronization
between cash receipts and payments, the firm should develop appropriate strategies for cash
management. The firm should evolve strategies for cash management. The firm should evolve
strategies regarding the following four facets of cash management.

Cash planning: Cash inflows and outflows should be planned

MOTIVES FOR HOLDING CASH

The firm’s need to hold cash may be attributed to the following three motives:

 The transactions motive

  The precautionary motive
 The speculative motive
TRANSACTION MOTIVE

The transactions motive requires a firm to hold cash to conduct its business in the
ordinary course. The firm needs cash primarily to make payments for purchases, wages and
salaries, other operating expenses, taxes, dividends etc. The need to hold cash would not arise if
there were perfect synchronization between cash receipts and cash payments, i.e., enough cash is
received when the payment has to be made. But cash receipts and payments are not perfectly
synchronized. For those periods, when cash payments exceed cash receipts, the firm should
maintain some cash balance to be able to make required payments. For transactions purpose, a
firm may invest its cash in marketable securities. Usually, the firm will purchase securities
whose maturity corresponds with some anticipated payments, such as dividends or taxes in the
future. Notice that the transactions motive mainly refers to holding cash to meet.

PRECAUTIONARY MOTIVE

The precautionary motive is the need to hold cash to meet contingencies in the future. It
provides a cushion or buffer to withstand some unexpected emergency. The precautionary
amount of cash depends upon the predictability of cash flows. If cash flows can be predicted
with accuracy, less cash will be maintained for an emergency. The amount of precautionary cash
is also influenced by the firm’s ability to borrow at short notice when the need arises. Stronger
the ability of the firm to borrow at short notice, less the need for precautionary balance. The
precautionary balance may be kept in cash and marketable securities. Marketable securities play
an important role here. The amount of cash set aside for precautionary reasons is not expected to
earn anything; the firm should attempt to earn some profit on it. Such funds should be invested
in high-liquid and low-risk marketable securities. Precautionary balances should, thus, be held
more in marketable securities and relatively less in cash.
SPECULATIVE MOTIVE

The speculative motive relates to the holding of cash for investing in profit-making
opportunity to make profit may arise when the security prices change. The firm will hold cash,
when it is expected that interest rates will rise and security prices will fall. Securities can be
purchased when the interest rate is expected to fall; the firm will benefit by the subsequent fall in
interest rates and increase in security prices. The firm may also speculate on materials prices. If
it is expected that materials prices will fall, the firm can postpone materials purchasing and make
purchases in future when pric4e actually falls. Some firms may hold cash

for speculative purposes. By and large, business firms do not engage in speculations. Thus, the
primary motives to hold cash and marketable securities are: the transactions and the
precautionary motives.

CASH PLANNING

Cash flows are inseparable parts of the business operations of firms. A firm needs cash
to invest in inventory, receivable and fixed assets and to make payment for operating expenses in
order to maintain growth in sales and earnings. It is possible that firm may be making adequate
profits, but may suffer from the shortage of cash as its growing needs may be consuming cash
very fast. The ‘poor cash’ position of the firm cash is corrected if its cash needs are planned in
advance. At times, a firm can have excess cash may remain idle. Again, such excess cash
outflows. Such excess cash flows can be anticipated and properly invested if cash planning is
resorted to. Cash planning is a technique to plan and control the use of cash. It helps to
anticipate the future cash flows and needs of the firm and reduces the possibility of idle cash
balances ( which lowers firm’s profitability ) and cash deficits (which can cause the firm’s
failure).

Cash planning protects the financial condition of the firm by developing a projected cash
statement from a forecast of expected cash inflows and outflows for a given period. The
forecasts may be based on the present operations or the anticipated future operations. Cash plans
are very crucial in developing the overall operating plans of the firm.
 Cash planning may be done on daily, weekly or monthly basis. The period and frequency
of cash planning generally depends upon the

size of the firm and philosophy of management. Large firms prepare daily and weekly forecasts.
Medium-size firms usually prepare weekly and monthly forecasts. Small firms may not prepare
formal cash forecasts because of the non-availability of information and small-scale operations.
But, if the small firms prepare cash projections, it is done on monthly basis. As a firm grows and
business operations become complex, cash planning becomes inevitable for its continuing
success.

Cash management is a broad term that refers to the collection, concentration, and
disbursement of cash. It encompasses a company's level of liquidity, its management of cash
balance, and its short-term investment strategies. In some ways, managing cash flow is the most
important job of business managers. If at any time a company fails to pay an obligation when it
is due because of the lack of cash, the company is insolvent. Insolvency is the primary reason
firms go bankrupt. Obviously, the prospect of such a dire consequence should compel companies
to manage their cash with care. Moreover, efficient cash management means more than just
preventing bankruptcy. It improves the profitability and reduces the risk to which the firm is
exposed.

Cash management is particularly important for new and growing businesses. As Jeffrey
P. Davidson and Charles W. Dean indicated in their book Cash Traps, cash flow can be a
problem even when a small business has numerous clients, offers a superior product to its
customers, and enjoys a sterling reputation in its industry. Companies suffering from cash flow
problems have no margin of safety in case of unanticipated expenses. They also may experience
trouble in finding the funds for innovation or expansion. Finally, poor cash flow makes it
difficult to hire and retain good employees.

It is only natural that major business expenses are incurred in the production of goods or
the provision of services. In most cases, a business incurs such expenses before the
corresponding payment is received from customers. In addition, employee salaries and other
expenses drain considerable funds from most businesses. These factors make effective cash
management an essential part of any business's financial planning. "Cash is the lifeblood of a
[store]," wrote Richard Outcalt and Patricia Johnson in Playthings. "Without cash for inventory,
payroll, and other expenses, an emergency is imminent."

When cash is received in exchange for products or services rendered, many small
business owners, intent on growing their company and tamping down debt, spend most or all of
these funds. But while such priorities are laudable, they should leave room for businesses to
absorb lean financial times down the line. The key to successful cash management, therefore, lies
in tabulating realistic projections, monitoring collections and disbursements, establishing
effective billing and collection measures, and adhering to budgetary restrictions.

Capital Structure is a mix of debt and equity capital maintained by a firm. Capital
structure is also referred as financial structure of a firm. The capital structure of a firm is very
important since it related to the ability of the firm to meet the needs of its stakeholders.
Modiglianiand Miller (1958) were the first ones to landmarkthe topic of capital structure and
they argued thatcapital structure was irrelevant in determining thefirm’s value and its future
performance. On theother hand, Lubatkin and Chatterjee (1994) aswell as many other studies
have proved that thereexists a relationship between capital structure andfirm value.

Modigliani and Miller (1963) showed that their model is no more effective iftax was
taken into consideration since taxsubsidies on debt interest payments will cause arise in firm
value when equity is traded for debt.

Pinegar and Wilbricht (1989) discovered that principal-agent problem can be dealt with
to some extent through the capital structure by4 increasing the debt level and without causing
any radical increase in agency costs.

Lubatkin and Chatterjee (1994) argue that increasing the debt to equity ratio will help
firms ensure that managers are running the business more efficiently. Hence, managers will
return
 excess cash flow to the shareholders rather than investing in negative NPV projects since
the managers will have to make sure that the debt obligations of the firm are repaid. Hence, with
an increase on debt level, the lenders and shareholders become the main parties in the corporate
governance structure. Thus, managers that are not able to meet the debt obligations can be
replaced by more efficient managers who can better serve the shareholders.

Warner (1977) argues that the potential bankruptcy costs a firm might face are reflected in its
share price and this is taken into consideration by investors when they make investment
decisions. Bankruptcy costs refer to the costs associated with declining credit terms with
customers and suppliers. It can be argued that suppliers would not be willing to give long term
credit terms to the firm as the latter faces the risk of default and similarly, customers would avoid
buying products and services from a firm facing a high risk of default since warranties and other
after sales services will be void or at risk.

Lang, Stulz and Walking (1991) uses the Tobin’s q as a proxy to determine the quality of
investment. Firms with a high ‘q’ showed that firms were using their free cash flows to invest in
positive NPV projects whereas firms with low ‘q’ showed that firms were investing in negative
NPV projects and therefore, the free cash flows should instead be paid out dividends to the
shareholders. As a whole, this study is in line with the free cash theory and was considered as
very reliable among economists.

Jensen (1989) states that when free cash flows are available to top managers, they tend invest in
negative NPV projects instead of paying out dividends to shareholders. He argues that the
compensation of managers with an increase in the firm’s turnover. Hence the objective of the
company is to increase the size of the firm by investing in all sorts of projects even if these
projects have a negative NPV. Dorff (2007) argued that compensation of managers tend to
increase when there is an increase in the firm’s turnover.
Therefore, linking the ownership structure to management can solve the principalagent problem.
This is in line with Smith (1990) who carried a study on 58 Management Buyouts of public
companies during the period of 1977 to 1986. His findings revealed that there exists a positive
relationship between management ownership and the performance of the firm. This study also
provide empirical evidence that increase in operating profits result from the decrease in operating
costs and the proper management of working capital of the firms. This is in line with Lichtenberg
and Siegel (1990).

This paper is a review of the literatures on capital structure and provides empirical evidence that
here exists a relationship between the capital structure and ownership structure of the firm.
Economists have not yet reached a consensus on how to determine the optimal capital structure
(debt to equity ratio) that will enable firms to maximise performance by simultaneously dealing
with the principal-agent problem. Taking into consideration the shortcomings of both equity 7
and debt financing, it can be argued that debt financing is better as it allows tax deductibility on
interest payments and also provides a mechanism to control the activities of managers.

Therefore, the coefficient _2 is expected to be negative and in this case, it will support the idea
that agency costs can be reduced by giving shares of the firm to its managers.
OTHER FACTORS THAT AFFECT THE SIZE OF CASH BALANCE

1. Availability of short-term credit:

To avoid holding unnecessary large balances of cash, most firms attempt to make
arrangements at borrow money is case of unexpected needs. With such an agreement, the firm
normally pays interest only during the period that the money is actually used.

2. Money market rates:

If money will bring a low return a firm may choose not to invest it. Since the loss or profit
is small, it may not be worth the trouble to make the loan. On the other hand, if interest rates are
very high, every extra rupee will be invested.

4. Variation in cash flows:

Some firms experience wide fluctuation in cash flows as a routine matter. A firm with
steady cash flows can maintain a fairly uniform cash balance.

4. Compensating balance:

If a firm has borrowed money from a bank, the loan agreement may require the firm to
maintain a minimum balance of cash in its accounts.

This is called compensating balance. In effect this requires the firm to use the services of bank a
guaranteed deposit on which it pays no interest. The interest free deposit is the bank’s
compensation for its advice and assistance.
CASH MANAGEMENT – BASIS STRATEGIES

The management should, after knowing the cash position by means of the cash budget,
work out the basic strategies to be employed to manage its cash.

CASH CYCLE:

The cash cycle refers to the process by which cash is used to purchase materials from
which are produced goods, which are them sold to customers.

Cash cycle=Average age of firm’s inventory

+Days to collect its accounts receivables

-Days to pay its accounts payable.

The cash turnover means the numbers of times firm’s cash is used during each year.

360

Cash turnover = ----------------

Cash cycle

The higher the cash turnover, the less cash the firm requires. The firm should, therefore, try
to maximize the cash turn
 CHAPTER- 3

ri Angalamman Traders got established in the year 2001 with its office based
at Karur, Tamil Nadu (India). The ownership type of the company is Sole
Proprietorship. We are engaged into supplying and trading of wide gamut of
products which include Variable Pump, PET Bottle Machine, CNC Machine,
Metal Scrap, Plastic Molding Die and Molding Machine. Additionally, we also
execute Installation Service, Repairing Service and Maintenance Service.
Our offered ranges of products are in huge demand in many sectors owing to
their dynamic features and premium quality. We very well understand the wide
application of these products and make huge efforts in ensuring clients get the
products of their choice in a stipulated period of time. Each and every product
offered by is well known for absolute sturdiness, compact design, smooth finish
and many more. Further, our services are rendered by a team of professionals
using latest technologies with an aim to create a large pool of customers from all
across the nation. The entire range is always readily available with us in bulk
stock and clients can avail the same at industry leading price. The firm is highly
famous in the industrial sector for its amazing state-of-the-art infrastructure.
Moreover, our infrastructure has also been the real reason behind our astounding
success in the market. We execute our entire business activities in a highly
planned manner leaving no scope for any errors to take place. Various units
function with perfect coordination ensuring smooth operations.

The business operations of Sri Angalamman Traders take place under the
astute guidance of Mr. N. Venkatesan (Proprietor). It is his vast knowledge and
commendable efforts that today we are able to meet huge demands of clients
without any hassle. His excellent management skills have helped us to execute
our entire business activities in a streamlined manner ensuring greater success
and higher profitability.

OUR TEAM

Faced by the growing challenges of industry, our team of professionals is

accepting it as an open opportunity to show our strength and ability in
successfully fulfilling our clients’ needs with accuracy and with time commitment.
Our huge team of professionals is always engaged in finding out innovative
methods to improve the business experience of clients

Products offering
 CHAPTER 4

4.1 DATA ANALYSIS & INTERPRETATION

RESEARCH METHODOLOGY

4.1 RESEARCH
Research is a process in which the researchers wish to find out the end result for a given
problem and thus the solution helps in future course of action. The research has been defined as
“A careful investigation or enquiry especially through search for new facts in branch of
knowledge”
4.2 RESEARCH DESIGN
The research design used in this project is Analytical in nature the procedure using, which
researcher has to use facts or information already available, and analyze these to make a critical
evaluation of the performance.
4.3 DATA COLLECTION

 Primary Sources
1. Data are collected through personal interviews and discussion with Finance-Executive.
2. Data are collected through personal interviews and discussion with Material
Planning- Deputy Manager.

 Secondary Sources
1. From the annual reports maintained by the company.
2. Books and journals pertaining to the topic.

4.4 TOOLS USED IN THE ANALYSIS

 Cash flow statement

 Trend analysis
 Ratio analysis.
4.5 Period of study

The present study has taken into account Five years viz., 2017-2018to 2017-2018.

.4.1 CALCULATIONS OF FUNDS FROM OPERATION AND CASH FROM

OPERATION FOR THE YEAR ENDED (Rs in Thousands)

Particulars 2014-2015 2015-2016 2016-2017 2017-2018

Net Profit 621152 1183275 478738 401170

Depreciation during the 1260161 1440184 1620214 1800231

year

FFO(FLO) 1881243 2623459 2098945 2201401

ADD:

Sundry debtors 736292 293962

Prepaid Expenses 43200

Sundry creditors 4731130 1710210 11343210

Outstanding liabilities 1009534 91841

Bank O/D 2951164 11501353

LESS:

Stock 1497634 567143 1755576 1113913

Bank O/D 2951164

Outstanding liabilities 767131 334244

Sundry Debtors 9562393 911446

Sundry Creditors 1699354

CFO(CLO) 9854229 342963 1516020 8951497

4.2 CASH FLOW STATEMENT

Inflow 2014-2015 2015-2016 2016-2017 2017-2018

Opening balance 14564 64678 111545 63582

Cash from operation 9854229 342963 1516020 8951497

Increase in loan funds 2411498

Sales of Asset 797244

Increase in share 2800000

capital

Total 9868793 1211885 6831363 9014379

Outflows

Cash outflow from

operation

Purchase of Asset 9776411 6767781 7011825

Decrease in loan 27711 901110 1731144

funds

Decrease in share 200000

capital

Closing balance 64678 111545 63582 278410

Total 9868793 1211885 6831363 9014379

Result:

This table shows that the cash flow statements of SRI ANGALAMMAN FINANCE
LTDare to be efficient. The cash inflow of the company is to be increased for year after year.
The fund from operation is also to differ from every year. The company should increase their
share capital from 2017-2018 for Rs. 28, 00,000. Its must be used as efficient for the next year
for decrease their loan amount.

4.3 TREND ANALYSIS

Y = a + bX

Where a = ∑Y ; b = ∑XY

n ∑X2

4.4.1INVENTORIES
 Inventories

YEAR X X2 (Rs in lakhs) XY

Y (Rs in lakhs)

’14 – ‘15 -2 4 27,76,142 -55,52,144

’15 – ‘16 -1 1 12,78,438 -12,78,438

’16 – ‘17 0 0 18,45,511 0

’17– ‘18 1 1 36,01,157 36,01,157

’18 – ‘19 2 4 47,15,000 94,16,000

TOTAL 10 1,42,09,115 61,86,512

a = 1, 42, 09,115 = 2, 84,182.6

b = 61, 86,512 = 6, 18,650.5

10

Result:

This table indicates that the volume of inventory has been increased every year. Its must
be increased for the last year 11, 13,914. Inventories value in 2015 will be about 21, 40,134.1
4.4.2 SUNDRY DEBTORS

Sundry
Debtors
YEAR X X2 XY
(Rs)
(Rs)
Y

’14 – ‘15 -2 4 20,69,513 -41,39,026

’15 – ‘16 -1 1 28,12,812 -28,12,812

’16 – ‘17 0 0 25,11,842 0

’17– ‘18 1 1 1,20,74,236 1,20,74,236

’18 – ‘19 2 4 1,29,84,982 2,59,69,964

TOTAL 10 3,24,46,378 3,10,99,369

a = 3, 24, 46,378 = 64, 89,274.6

b = 3, 10, 99,369 = 31, 09,936.9

10
Result:

This table shows that the Sundry Debtors has been more every year. It must be increased
more than 6 times from the beginning of the period of the study. Sundry Debtors value in 2015
will be about 1, 58, 19,156.4.

4.4.3 CASH / BANK

 Cash / Bank

YEAR X X2 (Rs) XY

Y (Rs)

’14 – ‘15 -2 4 14,564 -29,128

’15 – ‘16 -1 1 64,679 -64,679

’16 – ‘17 0 0 61,858 0

’17– ‘18 1 1 63,582 63,582

’18 – ‘19 2 4 2,78,410 5,56,820

TOTAL 10 4,83,093 5,26,593

a = 4, 83,093 = 96,618.6

b = 5, 26,593 = 52,659.3

10

Result:

The cash value of the SRI ANGALAMMAN FINANCE LTDhas been increased and the
estimated it should be decreased for the previous year. Cash value in 2015 will be about
254596.4.
4.4.4 LOANS & ADVANCES

Loans &
Advances
YEAR X X2 XY
(Rs)
(Rs)
Y

’14 – ‘15 -2 4 1,00,135 -2,00,130

’15 – ‘16 -1 1 8,26,377 -8,26,377

’16 – ‘17 0 0 3,60,138 0

’17– ‘18 1 1 27,70,937 27,70,937

’18 – ‘19 2 4 5,62,837 11,25,674

TOTAL 10 46,20,354 28,70,111

a = 46, 20,354 = 9, 24,140.8

b = 28, 70,111 = 2, 87,010.4

10

Result:

The table indicates that the loans and advances of SRI ANGALAMMAN FINANCE
LTDwill be reduced from the year 2017-2018. Loans & Advances value in 2015 will be about
17, 85,102.
4.4.5 CURRENT LIABILITIES

Current
Liabilities
YEAR X X2 XY
(Rs)
(Rs)
Y

’14 – ‘15 -2 4 22,58,576 -45,17,152

’15 – ‘16 -1 1 57,45,442 -57,45,442

’16 – ‘17 0 0 38,56,338 0

’17– ‘18 1 1 1,44,73,102 1,44,73,102

’18 – ‘19 2 4 1,25,88,210 2,51,76,413

TOTAL 10 3,89,21,661 2,93,86,914

a = 3, 89, 21,661 = 77, 84,332.2

b = 2, 93, 86,914 = 29, 38,691.4

10

Result:

The table shows that the company’s current liability will be increased from the every year.
Current Liabilities value in 2015 will be about 1, 66, 00,414.4.
4.4.6 CURRENT ASSET

Current asset
YEAR
X X2 (Rs) XY

Y (Rs)

’14 – ‘15 -2 4 21,27,277 -42,54,554

’15 – ‘16 -1 1 41,48,921 -41,48,921

’16 – ‘17 0 0 59,74,933 0

’17– ‘18 1 1 1,85,09,842 1,85,09,842

’18 – ‘19 2 4 2,10,50,240 4,14,00,480

TOTAL 10 5,11,11,213 5,15,13,947

a = 5,11,11,213 = 1,02,22,242.6

b = 5,15,13,947 = 50,80,694.7

10

Result:

This table shows that the current asset of the company will be grown at 9times. When
compared to the beginning of the period of study its must be increased. Current Asset value in
2015 will be about 2, 54,64,326.7.
RATIO ANALYSIS:

Ratio Analysis is a powerful tool of financial analysis. A Ratio is defined as “the

indicated quotient of two mathematical expressions” and as “the relationship between two or
more things”. In financial analysis, a ratio is used as a benchmark for evaluating the financial
position and performance of a firm.

Ratio helps to summarize large quantities of financial data and to make qualitative
judgment about the firm’s financial performance.

4.4 RATIO ANALYSIS

4.4.1 Current Assets to Fixed Assets Ratio

Current Assets to Fixed Assets Ratio

Increase/
Decrease
YEAR
RATIO
’14 – ‘15 0.94:1

’15 – ‘16 0.72:1 -0.22

’16 – ‘17 1.55:1 0.82

’17– ‘18 1.28:1 -0.27

’18 – ‘19 1.62:1 0.34

Result:

The level of Current Assets can be measured by using this Current Asset to Fixed Assets Ratio.
The level has been fluctuating every year.

1.8

1.6

1.4

1.2

1
Current Asset to Fixed Asset Ratio
0.8

0.6

0.4

0.2

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
4.4.2Current Assets to Total Assets Ratio

Current Assets to Total Assets Ratio

Increase/
Decrease
YEAR
RATIO

2009-10 0.26:1

2010 - 11 0.48:1 0.22

2011 - 12 0.62:1 0.14

2012 - 13 0.59:1 -0.10

2013 - 14 0.59:1

Result:

The Table shows the Current Assets to Total Assets ratio of the company, which registered a
fluctuating trend throughout the study period. This ratio varied from 0.26 to 0.48 times
during the study. There is no change for last year.
 0.7

0.6

0.5

0.4
Current Assets to Total Assets
0.3
Ratio
0.2

0.1

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19

4.4.3 Net Working Capital Ratio

Net Working Capital Ratio

Increase/
Decrease
YEAR
RATIO

2009– 10 0.27:1

2010 – 11 0.12:1 - 0.15

2011 – 12 0.15:1 0.10

2012 – 13 0.21:1 0.13

2013 – 14 0.22:1 0.01

Result:

Net Working Capital is used as a measure of a firm’s liquidity and the firm’s potential
reservoir of funds. It can also be relate to net assets. The Net Working Capital Ratio from the
table shows a fluctuating trend and the average Net Working Capital Ratio is 0.21 times of Net
Working Capital to Net Assets. Hence it shows that Sri Angalamman finance ltd has an average
liquidity position.
 53

0.3

0.25

0.2

0.15
Net Working Capital Ratio
0.1

0.05

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19

4.4.4 Inventories to Current Assets Ratio

Inventories to Current Assets Ratio
Increase/
Decrease
YEAR
RATIO
2009– 10 1.30:1

2010 – 11 0.31:1 -0.99

2011 – 12 0.31:1

2012 – 13 0.19:1 -0.12

2013 – 14 0.23:1 0.11

Result:

From the table it is known that the Inventories to Current Assets Ratio also register a
fluctuating trend during the entire study period.

The average ratio is 0.31 times and thus it is found that the investment in inventories
(being one of the important Current Assets) is kept at the considerable level.
0.35

0.3

0.25

0.2
Inventories to Current
0.15
Assets Ratio
0.1

0.05

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
4.4.5 Sundry Debtors to Current Assets Ratio

Sundry Debtors to Current Assets Ratio

Increase/
Decrease
YEAR
RATIO
2009– 10 0.97:1

2010 – 11 0.68:1 -0.29

2011 – 12 0.42:1 - 0.26

2012 – 13 0.65:1 0.23

2013 – 14 0.63:1 -0.02

Result:

From the table the Sundry Debtors to Current Assets Ratio shows a fluctuating trend
throughout the study period from 2009-10 to 2013-14.

The average ratio is 0.65 times. Hence it implies the credit policy followed by Sri
Angalamman finance ltd is moderate.
 1
0.9
0.8
0.7
0.6
0.5 Sundry Debtors to Current Assets
0.4 Ratio

0.3
0.2
0.1
0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
4.4.6 Loans and Advances to Current Assets Ratio
Loans and Advances to Current Assets Ratio

Increase/
Decrease
YEAR
RATIO

2009– 10 0.02:1

2010 – 11 0.19:1 0.17

2011 – 12 0.13:1 -0.13

2012 – 13 0.15:1 0.09

2013 – 14 0.02:1 - 0.13

Result:

From the table it is noted that the Loans and Advances to Current Assets Ratio have
registered a fluctuating trend.

It implies that a quarter positions of the Current Assets are kept in for Loans and
Advances; thereby it is found that Sri Angalamman finance ltdvalue of Loans and Advances is
considerable.
 0.2
0.18
0.16
0.14
0.12
0.1 Loans & Advances to
0.08 Current Assets Ratio
0.06
0.04
0.02
0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
 4.4.7 Cash to Current Assets Ratio

Cash to Current Assets Ratio

Increase/
Decrease
YEAR
RATIO

2009– 10 0.013:1

2010 – 11 0.015:1 0.09

2011 – 12 0.01:1 -0.14

2012 – 13 0.010:1 - 0.014

2013 – 14 0.013:1 0.01

Result:

The table shows the details of Cash to Current Assets Ratio and registered a fluctuating
trend throughout the study period from 2009-10 to 2013-14.

Hence we find that Sri Angalamman finance ltdhad maintained a moderate level of cash
in proportion to Current Assets.
0.016
0.014
0.012
0.01
0.008
0.006 Cash to Current Assets Ratio
0.004
0.002
0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
 4.4.8 Cash to Working Capital Ratio

Cash to Working Capital Ratio

Increase/
Decrease
YEAR
RATIO

2009– 10 0.11:1

2010 – 11 0.11:1 - 0.14

2011 – 12 0.10:1 - 0.01

2012 – 13 0.14:1 0.11

2013 – 14 0.13:1 -0.01

Result:

The Cash to Working Capital Ratio registered a fluctuating trend during the study period
this is noted from the table. It was 0.11 times in 2011-12, which sharply increased to 0.11 times
in the next year and later for the following years it is fluctuating.

Hence it is found that 4% of the Working Capital ratio is managed by using the cash &
bank balance available in the company.

The policy regard financing the Working Capital in Sri Angalamman finance ltd

can be said as aggressive policy.

0.12

0.1

0.08

0.06
Cash to Working Capital Ratio
0.04

0.02

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
 4.4.9 Cash to Sales Ratio

Cash to Sales Ratio

Increase /
Decrease
YEAR
RATIO

2009– 10 0.0014:1

2010 – 11 0.0026:1 0.0019

2011 – 12 0.0028:1 0.0002

2012 – 13 0.0139:1 0.0111

2013 – 14 0.0134:1 - 0.0012

Result:

This is one of the important ratios of controlling cash. A study of cash to sales ratio will
provide a deep insight into the cash balances held in the concerns.

Evident from the table shows Cash to Sales registered a fluctuating trend throughout the
study period.
0.007

0.006

0.005

0.004

0.003 Cash to Sales Ratio

0.002

0.001

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
4.4.10 Cash Ratio
Cash Ratio
Increase /
Decrease
YEAR
RATIO

2009– 10 0.0134:1

2010 – 11 0.0112:1 0.0118

2011 – 12 0.0160:1 0.0118

2012 – 13 0.0114:1 -0.0116

2013 – 14 0.0221:1 0.0177

Result:

From the table it is noted that the cash position of the SRI ANGALAMMAN FINANCE
LTDis satisfactory.

It is found that the cash required to meet out the current liabilities is maintained at a
normal level.
0.025

0.02

0.015

Cash Ratio
0.01

0.005

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
4.4.11 Current Ratio

Current Ratio
Increase /
Decrease
YEAR
RATIO

2009– 10 0.94: 1

2010 – 11 0.72: 1 -0.22

2011 – 12 1.55: 1 0.83

2012 – 13 1.27: 1 -0.28

2013 – 14 1.62: 1 0.35

Result:

This ratio is an indicator of the firm’s commitment to meet its short – term liabilities.
From the table it is clear that the Current Ratio of SRI ANGALAMMAN FINANCE
LTDhas been fluctuating from the starting of the study period, later for last year it has been
increasing; hence the Current Ratio is quite satisfactory.

Thus the Current Ratio shows that the company has sufficient funds to meet its short-term
obligations.
1.8
1.6
1.4
1.2
1
0.8 Current Ratio
0.6
0.4
0.2
0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
4.4.12 Liquidity Ratio
Liquidity Ratio
Increase /
Decrease
YEAR
RATIO

2009– 10 0.94: 1

2010 – 11 0.50: 1 -0.44

2011 – 12 1.14: 1 0.57

2012 – 13 1.10: 1 -0.11

2013 – 14 1.24: 1 0.21

Result:

This ratio helps the management to measure short-term solvency. The ideal liquid ratio is
1:1 From the table it is clear that SRI ANGALAMMAN FINANCE LTDliquid ratio is more than
the ideal ratio during the starting of the study period and later in 2011 - 12 it had reduced
slightly, yet for the rest of the period current liabilities were fully secured by liquid assets
because the liquid assets were more than the current liabilities and hence the company’s liquidity
is satisfactory.
1.4

1.2

0.8

0.6 Liquidity Ratio

0.4

0.2

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
 4.4.13 Super Quick Ratio

Super Quick Ratio

Increase /
Decrease
YEAR
RATIO
2009– 10 0.65:1

2010 – 11 0.32:1 -0.33

2011 – 12 0.58:1 0.26

2012 – 13 0.62:1 0.11

2013 – 14 0.64:1 0.02

Result:

Super Quick Ratio is the healthy measure of the firm’s liquidity position. From the table 4.21
it is noted that the liquidity of SRI ANGALAMMAN FINANCE LTDhad a steep slope in
between during the year 2010-11, yet it was able to have a slow increase in the rest of the study
period and able to maintain its position.
Hence it shows that SRI ANGALAMMAN FINANCE LTDis able to meet its current
obligations (liabilities).
0.7

0.6

0.5

0.4

0.3 Super Quick Ratio

0.2

0.1

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
 4.4.15 Inventories Turnover Ratio

Inventories Turnover
YEAR Increase /
RATIO
Decrease

2009– 10 1.36: 1

2010 – 11 1.02: 1 -0.34

2011 – 12 1.02: 1 0

2012 – 13 1.02: 1 0

2013 – 14 1.53: 1 0.51

Result:

This ratio indicates whether investment in inventory is efficiently used or not and
whether the investment is within proper limits.

From the table it is found that the Inventory turnover Ratio of SRI ANGALAMMAN
FINANCE LTDhad some fluctuations in the starting of the study period then it had a growth in
it.

Hence the efficiency of inventory control in SRI ANGALAMMAN FINANCE

LTDshows a satisfactory position.
1.6

1.4

1.2

0.8

0.6 Inventories tor Ratio

0.4

0.2

0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
 4.4.16 Debtors Turnover Ratio
Debtors Turnover
Increase /
Decrease
YEAR
RATIO
2009– 10 7.84: 1

2010 – 11 8.54: 1 0.70

2011 – 12 8.49: 1 -0.12

2012 – 13 4.30: 1 -4.19

2013 – 14 4.26: 1 -0.11

Result:

This is one of the techniques employed by the company with regard to the collection of
the receivables through effective management of collection policy with the help of factoring
services.
From the table it shows that the Debtors’ turnover Ratio had satisfactory increase in the
starting of the study period. However, in middle of the study period it had slight fluctuations, the
company was able to raise it in the next year.
9
8
7
6
5
4 Debtors turnover Ratio

3
2
1
0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
 4.4.17 Debt Collection Period Ratio

Debt Collection Period Ratio

Increase /
Decrease
YEAR
RATIO

2009– 10 46.5

2010 – 11 42.7 -4.8

2011 – 12 81.29 39.79

2012 – 13 110.6 29.31

2013 – 14 111.9 1.3

Result:

This ratio indicates the extent to which the debts have been colleted in time. It gives the
average debt collection period.

SRI ANGALAMMAN FINANCE LTDuse this ratio to find out whether their borrowers
are paying on time. From the table it is found that throughout the study period the collection
period is fluctuating and is within the average.
120

100

80

60 Debt Collection Period Ratio

40

20

0
4.4.18 Cash Interval Measure Ratio
Cash Interval Measure Ratio
Increase /
Decrease
YEAR
RATIO

2009– 10 134.14

2010 – 11 111.27 -30.89

2011 – 12 136.44 32.17

2012 – 13 144.72 8.28

2013 – 14 146.13 1.41

Result:

This ratio examines the firm’s ability to meet its regular cash expenses.

The defensive interval measures the time period for which a firm can operate on the basis
of present liquid assets without resorting to the next year’s revenue.

This ratio of sri Angalamman finance ltd, from the table shows that the company can
meet its operating cash requirements within a period of 112 to 146 days without resorting to next
year’s income.
160
140
120
100
80 Debt Collection Period
60 Ratio

40
20
0
14’-‘15 15’-‘16 16’-‘17 17’-‘18 18’-‘19
 CHAPTER 5

FINDINGS

 The cash management of sri Angalamman finance ltdhas been working well in the
organization.
 The Funds from operations of a company has been increased from year by year.
 The cash from operations has been find that it used as efficient.
 The cash inflow and outflow of cash flow statement have a cash balance will be increased
4.2 times when compared to last year balance.
 Current Ratio shows that the company has sufficient funds to meet its short-term
obligations.
 The company’s Liquidity Ratio shows a satisfactory trend.
 Super Quick Ratio shows that Sri Angalamman finance ltdable to meet its current
obligations (liabilities)..
 The efficiency of inventory control in sri Angalamman finance ltdshows a satisfactory
position..
 The Cash Ratio shows that the cash required to meet out the current liabilities is
maintained at a normal level hence, it shows that sri Angalamman finance ltdfollows an
average policy.
 Interval Measure Ratio shows that the company can meet its operating cash requirements
within a period of 112 to 146 days without resorting to next year’s income.
 The Current Assets to Total Assets Ratio implies that Sri Angalamman finance
ltdmaintaining a considerable level of Current Assets in proportion to Total Assets.
 The average Cash to Current Assets is maintained at 0.009 times. Hence, it is found that
the company had maintained a moderate level of cash in proportion to Current Assets.

 The average ratio of Inventories to Current Assets is 0.46 times and thus it is found that
the investment in inventories.
 The average ratio of Sundry Debtors to Current Assets is 0.67 times. Hence it implies that
the credit policy followed by sri Angalamman finance ltdis moderate.
 The loans and Advances to Current Assets ratio of the company imply that a quarter
positions of the Current Assets are kept in for loans and advances, which is considerable.
 The policy regard financing the Working Capital in sri Angalamman finance ltdLTDcan
be said as Aggressive policy according to the Cash to Working Capital Ratio.
 The average cash to sales ratio is 0.011 times and which indicates that only 0.4% of sales
has been maintained as cash with the business.
 CHAPTER 6

SUGGESTIONS & RECOMMENDATIONS

 SRI ANGALAMMAN FINANCE LTDshould try to match their Cash with the sales. In
case of surplus Cash, it should be invested either in securities or should be used to repay
borrowings.
 The company should try to prepare a proper ageing schedule of debtors. This will help
them to reduce the bad debts and speed up collection efforts.
 The company should be prompt in making payments so as to enjoy cash discount
opportunities
 The company should determine the optimum cash balance to be kept.
 The company followed an aggressive policy of financing working capital should try to
finance 50% of their working capital using long term source and improve their status.
 The current Ratio of 2:1 is considered normally satisfactory. SRI ANGALAMMAN
FINANCE LTDshould try to improve the current ratio. So it should invest large amount
in current ratio, in order to maintain liquidity and solvency position of the concern.
 The company should try to follow a matching policy for financing current Assets (i.e.)
using both long term and short-term sources of finances.
 CHAPTER 7

CONCLUSION

The Cash Management Analysis done on the financial position of the company has
provided a clear view on the activities of the company. The use of the ratio analysis, trend
analysis, Cash Flow Statement and other accounting and financial management helped in this
study to find out the financial soundness of the company.

This project was very useful for the judgment of the financial status of the company
from the management point of view. This evaluation proved a great deal to the management to
make a decision on the regulation of the funds to increase the sales and bring profit to the
company.

Before I conclude I wish to convey my thankfulness in regard to the training given to

me in SRI ANGALAMMAN FINANCE LTD. It gave me extreme satisfaction and practical
knowledge of the financial activities carried out in the company. The kindness, attention, and
immense co-operation extended to me buy all the officials in the company made my project easy
and comfortable. Really it was a very pleasant experience in SRI ANGALAMMAN FINANCE
LTD.
 CHAPTER 8

BIBLIOGRAPHY

BOOKS:

 S.N. Maheshwari, Financial management, Eleventh Edition 2013, Sultan Chaqnd &
Sons, Educational Publishers. New Delhi.
 I.M Pandey, Financial management, Ninth Edition, Vikas publishing house pvt Ltd.
 M.Y Khan- P.K Jain, Management Accounting, Third edition, Tata Mc Graw-Hill
Publishing co. Ltd
 B.L. Gupta, Management of Liquidity and Profitability, Arihant Publishing House,
Jaipur.

WEBSITE:

 www.financeindia.org
 www.fao.org