Cash Flow Project

CHAPTER-1
INTRODUCTION
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1. Introduction:
From a financial point of view a firm basically generates cash and spends cash. It generates
cash when it issues securities, raises bank loans, sells products, disposes an asset, and so on forth. It
spends cash when it redeems securities, pays interest and dividends. Purchases materials,
Acquires an asset etc. the activities that generates cash are called sources of cash and the activities that
absorb cash are called uses of cash.
Background on a Cash Flow Statement

Before getting into the nuts and bolts of a statement of cash flow, let’s take a brief look at how this
document has evolved over the years.
Originally, businesses were required to file a statement of changes in financial position, or funds
statement. The funds statement went through several years of development before it was widely used.
In 1961, Accounting Research Study No. 2, sponsored by the American Institute of Certified Public
Accountants (AICPA), recommended that a funds statement be included with the income statement and
balance sheet in annual reports to shareholders.
Two years later, Accounting Principles Board (APB) Opinion No. 3 was issued and provided funds
statement preparation guidelines. Although Opinion No. 3 did not go so far as to make the funds
statement mandatory, most businesses, aware of the statement’s value, included it in their annual
reports anyway. Finally in 1971, APB Opinion No. 19 officially made the funds statement one of the three
primary financial documents required in annual reports to shareholders. The APB also said a funds
statement must be covered by the auditor’s report. Because Opinion No. 19 didn’t specify a particular
format for the funds statement, businesses still enjoyed considerable flexibility in how they chose to
report their funds flow information.
That flexibility came to an end in late 1987, with the Financial Accounting Standards Board’s
(FASB) issuance of Statement No. 95, which called for a statement of cash flows to replace the more
general funds statement. Additionally, the FASB, in an effort to help investors and creditors better
predict future cash flow, specified a universal statement format that highlightedcash flow from operating,
investing, and financing activities. This format is still used today.
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Importance
As stated earlier. Cash flow statement analyses cash inflows of a firm. The importance ofcash to
a business cannot to be a over emphasized. it is the most important current asset for the operations of
the business, it is the basic input to keep the business going continuously and also the ultimate output
expected to be realized by the firm. A firm needs cash to make payments to trade creditors, to incur day-
to-day operating expenses, to pay interest to the debenture holders and dividends to shareholders. the
firm should always keep sufficient cash in order to meet maturing obligations. A statement which
summarizes the inflows and outflows of cash definitely becomes a useful tool/said to the management.
a historical analysis of different sources and uses of cash will enable the management to make reliable
cash flow projections for the immediate future (i.e., for the short term financial planning). Such a
projected statement helps the management to assess its ability to meet different obligations and when
they fall due. These projected cash flow statements prepared month wise or so can be useful in revealing
the months cash surplus or deficit. By making available such information in advance, the projected cash
flow statement enables the management to revise its plans in the months when cash surplus is
expected, bank overdraft can be repaid, short term securities can be purchased, cash discount can be
availed of and so on. Similarly, in the months when cash deficit is expected, the firm would be required
to arrange for bank overdraft or other short term loans or sell its marketable securities. Thus cash flow
statements (historical and/ or projected) offer many advantage to the management of a firm. The
following are some of them:
it helps in efficient cash management:
cash flow analysis helps in evaluating the cash position and short term
financial policies, the management can know how much of cash is needed, from which sources it will
be obtained, how much of it can be generated internally and how much could be obtained from
outside.
it helps in internal financial management:

cash flow analysis reveals funds available from different sources including the operations of the
firm. this will help the management in determining policies regarding repayment of long term debt,
dividend policies, capital expenditure, etc.
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it discloses the movements of cash.
It discloses the sources or failure of cash planning. The extent of success of cash planning can be
known as per the securities exchange board of India(SEBI) guidelines for cash flow reporting, the
objective of the cash flow statement(CFS)is to require reporting entitles falling within its scope to report
on a standard basis their cash generation and cash absorption for a period between two balance sheet
dates. Standard heading have been devised for assisting the users to assess the liquidity, viability and
financial adaptability of the reporting entity. This will ensure that cash flow performance of different and
varying natures of business. Cash flow statements are prepared to serve the following purpose:
1) To analysis the pattern of resources deployment in/out of assets.
2) To evaluate net changes in assets of a company. the concept of a cash windfall or too much
money is rarely addressed. Because no one really plans for having more money than they need,
there are often situations where a person will make frivolous purchases...
3) To provide an insight into the ability of the company to generate cash and cash equivalents.
a historical cash flow statement also serves as an indicator of the amount, timing and certain
the concept of a cash windfall or too much money is rarely addressed. Because no one really
plans for having more money than they need, there are often situations where a person will
make frivolouspurchases...y of future cash flows.
4) To assess the reasons for differences between net income, cash receipts and payments.
5) To evaluate the effects of firms financial position of the concept of a cash windfall or too
much money is rarely addressed. Because no one really plans for having more money than they
need, there are often situations where a person will make frivolous purchases...ash and
non-cashtransactions
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Concept:
The accounting concept of cash flow provides insight into businesses operations and cash
positioning at the time the cash flow is recorded. Cash flow in its simplest form is the sum of cash...
(when the concept first began), and cash flow was generally positive in the first month or two. What
other concepts stand out as the next likely Curves? Let's look at the marketplace for that answer. Baby
boomers the concept of a cash windfall or too much money is rarely addressed. Because no one really
plans for having more money than they need, there are often situations where a person will make
frivolous purchases...
a cash flow statement is the same as fund flow statement except that changes in the
current assets and current liabilities are shown separately rather than combined a single item
working capital.
Preparation of cash flow statement:
A cash flow statement can be prepared on the same pattern on which a Funds Flow Statement is
prepared. The change in the cash position from one period to another is computed by taking intoaccount”
sources” and “applications” of cash.
Sources of cash: sources of cash can be both internal as well as external.
1. Internal sources:
Cash from operations is the main internal source. The net profit shown by the profit and loss Account
will have to adjust for non-cash items for finding out cash from operations. Some of these items are as
follows.
I. Depreciation:
Depreciation does not result in outflow of cash and, therefore net profit will have to be
increased by the amount of depreciation or development rebate charged, in order to find out the real
cash generated from operations.
II. Amortization of intangible assets:

Goodwill, preliminary expenses, etc when written off against profits reduce the net profits without
affecting the cash balance. The amounts written off should, therefore, be added back to profits to find
out the cash from operations.
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III. Loss on sale of fixed assets:
It does not result in out flow of cash and, therefore, should be added back to profits.
IV. Gains from sale of fixed assets:

Since sale of fixed assets is taken as a separate source of cash, it should be deducted fromnet
profits.
V. Creation of reserves:
If profit for the year has been arrived at after charging transfers to reserves, such transfers
should be added back to profits. In case operations show a net loss, such net loss after making
adjustments for non-cash items will be shown as an application of cash.
Thus cash from operations is computed on the pattern of computation of ‘Funds’ from operations, as
explained in the earlier chapter. However, to find out real cash from operations, adjustments will have
to be made for ‘changes’ in assets and current liabilities arising on account of operations, viz, trade
debtors, trade creditors, bills receivable, bills payable,etc.
For the sake of convenience computation of cash from operations can be studied by taking two
different situations.
1. When all transactions are cash transactions and
2. When all transactions are not cash transactions.
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1.6.1 When all transactions are cash transactions:
The computation of cash from operations will be very simple in this case. The net profit asshown
by the Profit and Loss Account will be taken as the amount of cash from operations.
Cash from operations = Net profit
When all transactions are not cash transactions:
In the example given above, we have computed cash from operations on the basis that all
transactions are cash transactions. It does not really happen in actual practice. The business sells goods
on credit. It purchases goods on credit. Certain expenses are always outstanding and some of the
incomes are not immediately realized. Under such circumstance, the net profit made by a firm cannot
generate equivalent amount of cash. The computation of cash from operations in such a situation can be
done conveniently if it is done in two stages.
1. Computations of funds (i.e. working capital) from operations as explained in the

precedingchapter and
2. Adjustments in the funds so calculated for changes in the current assets (excluding cash)
and current liabilities.
1.6.3 Adjustments for changes in the current assets and current liabilities:
In the illustration given above the cash from operations has been computed on the same pattern on
which funds from operations are computed. As a matter of fact, the funds from operations are
equivalent to cash from operations in this case. This is because of the presumption that all are cash
transactions and all goods have been sold. However, there may be credit purchases, credit sales,
outstanding and prepaid expenses; etc in such a cash, adjustments will have to be made for each of
these items in order to find out cash from operations. This has been explained in the followingpages.
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Effect of credit sales:
In business there are both cash sales and credit sales in case, the total sales are Rs.30000 out of which
the credit sales are Rs.10000 it means sales have contributed only to the extent of Rs.20000 in providing
cash from operations. Thus while computing cash from operations it will be necessary that suitable
adjustments for outstanding debtors are also made.
Cash from the operations = Net profit + debtors outstanding at the
Beginning form Accounting year - debtors outstanding at the
End of the Accounting year The cash from operations can be calculated
OR
cash from operations = net profit + decrease in debtors
OR
- increase in debtors
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Following if there are debtors outstanding at the end as well as in the beginning of the
accounting year.
Effect of credit purchases:
Whatever has been started regarding credit sales is also applicable to credit purchaser. The only
difference will be that decrease in creditors from one period to another will result in decrease of cash
from operations because it means more cash payments have been made to the creditors because it
means more cash payments have been made to the creditors which will result in out
flow of cash. On the other hand increase in creditors from one period to another will result in increase
of cash from operations because less payment has been made to the creditors for goods supplied which
will result in the increase of cash balance at the disposal of the business.
Thus the effect balance of credit purchases can be shown with the help of the following equation
in computing cash from operations:
cash from operations = Net profit + increase in creditors
Or
- decrease in creditors
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Effect of opening and closing stocks:
The amount of opening stock is charged to the debit side of the profit and loss account. It thus
reduces the net profit without reducing the cash from operations. Similarly, the amount of closing stock
is put on the credit side of the profit and loss account. It thus increases the amount of net profit without
increasing the cash from operations.
The effect of change in stock on cash from operations can now be put as follows.
cash from operations = Net profit + decrease in creditors
Or
- increase in creditors
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Effect of outstanding expenses, incomes received in advance, etc.
The effect of these items on cash from operations is similar to the effect of creditors. This means any
increase in these items will result in increase in cash from operations while any decrease meansdecrease in
cash from operations. This is because net profit from operations is computed after charging to it all
expenses whether paid or outstanding. In
Case certain expenses have not been paid, this will result in decrease of net profit with
out a corresponding decrease in cash from operations. Similarly income received in advance is not taken
into account while calculating profit from operations, since it relates to the next year.It therefore means
cash from operations will be higher than the actual net profit as shown by the profit and loss account.
Thus, the effect of income received in advance and outstanding expenses on cash from operations
can be shown below.
CASH FROM OPERATIONS = NET PROFIT + INCREASE IN OUTSTANDING EXPENSES +

INCREASE IN INCOME RECEIVED IN ADVANCE – DECREASE IN OUTSTANDING EXPENSES –
DECREASE IN INCOME RECEIVED IN ADVANCE.
EFFECT OF PREPAID EXPENSES AND OUT STANDING INCOMES:
The effect of prepaid expenses and outstanding incomes on cash from operations is similar to the
effect of debtors. While computing net profit from operations the expenses only for accounting year are
charged to the profit and loss account. Expenses paid in advance are not charged to the profit and loss
account. Thus, prepayment of expenses does not decrease net profit for the year but it decreases cash
from operations. Similarly, income earned during a year but it decreases cash from operations. Loss
account whether it has been received or not. Thus, incomes, net profit for the year with out increasing
cash from operations.
Thus, the effect of prepaid expenses and accrued incomes on cash from operations can be
shown in the form of following equation.
CASH FROM OPERATIONS = NET PROFIT + DECREASE IN PREPAID EXPENSES + DECREASE IN

ACCRUED INCOMES – INCREASE IN PREPAID EXPENSES – INCREASE IN ACCRUED INCOME
The over all affect of stock, debtors, creditors, outstanding expenses
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Incomes, received in advance, prepaid expenses and accrued incomes can be shown in the following
formula.
CASH FROM OPERATIONS = NET PROFIT + DECREASE IN DEBTORS + DECREASE IN STOCK +

DECREASE IN PREPAID EXPENSES + INCREASE IN CREDITORS + INCREASE IN OUTSTANDING
EXPENSES – INCREASE IN DEBTORS
– INCREASE IN STOCK – INCREASE IN PREPAID EXPENSES – DECREASE IN CREDITORS –
DECREASE IN OUTSTANDING EXPENSES.
The above formula may be summarized in the form of following general rules.
1. INCREASE IN CURRENT ASSET
2. DECREASE IN CURRENT LIABILITY
3. RESULTS IN DECREASE IN CASH AND DECREASE IN CURRENT ASSET
4. INCREASE IN CURRENT LIABILITY
5. RESULTS IN INCREASE OF CASH
1.13. External sources of cash:
(A) Issue of new shares:
In case shares have been issued for cash, the net cash received (that is after deducting expenseson
issue of shares of discount on issue of shares will be taken as a source of cash.
(B) Raising long term loans:
Long term loans such as issue of debentures, loans from industrial financial corporations, state
financial corporations, IDBI etc.
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(C) Purchase of plant and machinery on deferred payment:
In cash plant and machinery has been purchase on a deferred payment system, it should be shown as a
separate source of cash to the extent of deferred credit. How ever, and the cost of machinery purchased
will be shown as an application of cash.
(D) Short term borrowings-cash credits from banks:
Short term borrowing, etc. from banks increases cash available and they have to be shown separately
under this head.
(E) Sale of fixed assets, investment, etc.:
It results in generation of cash and therefore, is a source of cash.
Decrease in various current assets and increase in various current liabilities (discussed before) may be
taken as external sources of cash, if they are not adjusted while computing cash from operations.
Applications of cash :
Applications of cash may take any of the following forms:
(a) Purchase of fixed assets:
Cash may be utilized for additional fixed assets or renewal or replacement of existing fixed assets.
(b) Payment of long term loans:
The payment of long term loans such as loans from financial institutions or debenture results in
decrease in cash. It is therefore, an application of cash.
(c) Loss on account of operations:
Loss suffered on account of business operations will result in outflow of cash.
(d) Decrease in deferred payment liabilities:
A payment for plant and machinery purchases on deferred payment basis has to be made asper the
agreement. It is, therefore, an application of cash.
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(e) Payment of tax:
Payment of tax will result in decrease of cash and hence it is an application of cash.
(f) Payment of dividend:
This decreases the cash available for business and hence it is an application of cash.
(g) Decrease in unsecured loans, deposits, etc:
The decrease in these liabilities denotes that they have been paid off to that. It results, therefore, in
outflow of cash.
Utility Of Cash Flow Analysis:
A cash flow statement is useful for short-term planning. A business enterprise needs sufficient cash to
meet its various obligations in the near future such as payment for purchase of fixed assets, payment of
debts maturing in the near future, expenses of the business, etc. a historical analysis of the different
sources and applications of cash will enable that management to make reliable cash flow
Projections for the immediate future. It may then plan out for investment of surplus of meeting the
deficit, if any. Thus, a cash flow analysis is an important financial tool for the management its chief
advantages are as follows.
(1) Help in efficient cash management:
Cash flow analysis helps in evaluating financial policies and cash position. Cash is the basis for all
operations and hence a projected cash flow statement will enable the management to plan and
coordinate the financial operations properly. The management can know how much cash in needed,
from which source it will be derived, how much can be generated internally and how much could be
obtained from outside.
(2) Help in internal financial management:
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Cash flow analysis provides information about funds, which will be available from operations.This will
help the management in determining policies regarding internal financial management
e.g. possibility of repayment of long-term debt, dividend policies planning replacement of plantand
machinery.
(3) Discloses the movements of cash:
Cash flow statement discloses the complete story of cash movement. The increase in, or
decrease of, cash and the reasons therefore can be known, it discloses the reasons for low cash
balance in spite of heavy operating profits of for heavy dash balance in spite of low profits. However,
comparison of original forecast with the actual results highlights the trends of movements of cash, which
may otherwise go undetected.
(4) Discloses success or failure of cash planning:
The extent of success of failure of cash planning can be known by comparing the projected cash flow
statement with the actual cash flow statement and necessary remedial measures can be taken.
Limitations Of Cash flow Analysis:
Cash flow analysis is a useful tool of financial analysis. However; it has its own limitations. These
limitations are as under.
(1) Cash flow statement cannot be equated with the income statement, an income
statement takes into account both cash as well as non cash items and, therefore, net cash flow
does not necessary mean net income of the business.
(2) The cash balance as disclosed by the cash statement may not represent the real liquid
position of the business since it can be easily influenced by postponing purchases and other
payments.
(3) Cash flow statement cannot replace the income statement or the funds flow statement.
Each of them has a separate function to perform.
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In spite of these limitations, it can be said that cash flow statement is a useful supplementary
instrument. It discloses the volume as well as the speed which the cash flows in the different segment of
the business. This helps the management in knowing the amount of capital tied up in a particular
segment of the business. The technique of cash.
Cash flow analysis is a useful tool of financial analysis. However; it has its own limitations.
These limitations are as under.
payments.
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Cash Forecasts: flow statements are
classified into three

The cash forecasts
classes. Cash flows from
help in determining the
operating activities
amount of cash
required and the ▪ Cash flows from inverting activities
sources from which it ▪ Cash flows from financing activities
will be obtained during
different time periods. Thought this format calls for more details. It provides
useful information on how cash flows have been influenced by
This is also known as
different kinds of decisions. Given the greater informational content
cash budgeting. The of such a format, the discussion paper on ‘cash flow statements’
different methods of prepared by the accounting principles board of the institute of
cash budgeting or chartered accountants of India recommends this format. Incidentally
the listed companies must include a ‘cash flow statement’.
making or cash
forecasts are explained
in the chapter
“budgetary control”,
given later in the book.
Classified cash flow

statement:
17
CHAPTER-2
INDUSTRY PROFILE &
COMPANY PROFILE
18
Company & Industry
Profile
The term plastic is derived from the Greek word “9PLASTICKOS”, which means, “to access rubber and
the other natural product‟. Resins are both natural and synthetic. Natural resins rangefrom pitch and
asafetida to frankincense, myrrh and amber synthetic resins replaced natural resins.
The first plastic “ Prakesine ‟ later called Xylonite, was invented by an English chemist andinventor
Alexander Parnes in 6.
It was John W. Hyah of the USA who recognized in 1869, the vital palatalizing effect ofcamphor
and named the product “Celluloid”.
Leo Hendrick Baekeland, American Chemist, commerciality produced the first computersynthetic
plastic from phenol and formaldehyde in.
A significant property of most of the plastics is that they softy when heated. So that they can be formed
into shapes, they became rigid on cooling. This property is derived from the physical structure of Poly
Vinyl Chloride which consists of a net work of very large molecules called polymers. Long chains that
separate under heat sufficiently to slide apart, but on cooling becamefirmly entangled again.
All plastics are manufactured by some method of polymerization i.e. the process of forming thelong
chains and networks of molecules.
The two major types of plastics are:
Thermo setting resins
Thermo plastics resins.
Thermo setting resins:-
They became insoluble and infusible on heating. They are phonetic resins, Furan resins, aminoplastics,
Alkyls and polyesters of unsaturated acids, Epoxy resins. Polyethane‟s and silicones.
Thermo plastics resins:-
These can be melted and solidified repeatedly, unlikely thermosetting resins. They include cellulose
derivatives and additional polymers. Others type4 of resins include oil soluble or modified resins, plastics
such as casein and lignin extract from natural products and special application synthetics such as resins
used as adhesives and as additives to paper and textiles.
The raw materials for plastics include coal and cellulose, but the chief source is petroleum. Plastics are
formed by a variety of means, including extrusion blow molding between rollers,thermosetting in
hydraulic pressures.
19
Industrial Plastics :-
Plastics are used for the industrial purpose is called industrial plastics. It is of 2 types;
Structural foams.
Sheets and films.
Structural foams:- It is of 2 types
a) Rigid Foams
b) Flexible Foams
a. Rigid Foams:-
Rigid Polyether foams in sandwich foams have wide applications a building component becauseof the
stiffness imparted by the thick foam center for a given Weight. They are also best insolvent known
today and so have wide application in fitted slabs and are formed into cavities atthe building site. Very
important se .of rigid foam is for furniture parts to reproduce wood structures.
b. Flexible Foams:-
Flexible foams, usually polyether Urethane are made in slab roam up to 8 feet (2.4 meters) inwhich
and, as much as 5 feet (1 .5 meters) high, these are cut to required shapes or sizes or molded. Used
almost exclusively shapes or sizes or molded. Used almost exclusively by the automobile industry for
crash pads, arm sets and dash board covers.
Sheets and Films:-
These include Vinyl‟ s Fluro plastics and cellulose acetate vinyl.
Plasticized Poly Vinyl Chloride by a calendaring process, can sawn, heat sealed or electronicallysealed, it is
used for apparel, door curtains. Protective clothing and the like made in many colors,
transparent and translucent or opaque. Poly Vinyl Chloride can be with pressure sensitive
adhesives and printed with decorative patterns. Thicker sheet is colored and embossed for
women handbags, luggage and seat covers.
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This film is used for packaging, especially for meat and fruits. If biaxial stretched, it forms ashrink film that
retracts up to 60%. Another important use is a laminate for printed paper.
Flooring tiles, largely made of PVC are built up by lamination and decorated either by printing or by
rolling in color chips. The common title is vinyl asbestos, pressed into sheets on calendarsand ten
embossed and cut into titles. Rigid PVC sheet as high dimensional stability and flame redundancy and is
often used in corrugated form for building construction. Partitions, drainage gutters, industrial
lightening panels are the other uses. Styrene
film is widely used for rigid containers, especially packing, molding, laminating by press andcasting.
Formed plastics are produced by forming gas bubbles in the molten material. Plastic products are
further shaped and finished by means of ranging from mechanical through laser machining,ultrasonic
welding and radiation processing.
Vinyl Chloride, discovered in 1815, is formed by the reaction of acetylene with hydrochloride acid. The
polymer Poly Vinyl Chloride (PVC) was first produced in 1912. Plastic research and manufacture was
proceeding on a considerable scale in the US study of polymers in the laboratory of E. l DuPont De
Nemours and company from 1928 onwards, which led to the superpolyamide or Nylon.
Vinyl Chloride is made from ethylene and chlorine. Though acetylene can also be used. Then polymer is
mainly processed in a highly Plasticized form with varying degrees of flexibility, by acalendaring,
extraction molding, often form of “dry blends‟, mixtures made below temperature from polymer
plasticizer and pigments. Plasticizers are chosen to maintain flexibility at low temperatures.
The range of applications of flexible Poly Vinyl Chloride is enormous and covers flooring, wire
insulation, home furnishing, piping etc.
Acrylonitrile - Butanide - styrene possesses a wide range of properties notably scuff resistance,high
impact strength at lower temperatures, making it suitable for high, quality luggage , refrigerator linings,
food and detergent, containers because of its chemical resistance to heat.
Thick acroconitrale - butanide - styrene sheet is used for sports car, bodies and automobile doors.Nylon
films mostly from nylon-6.6 are ideal for food packaging, because of strength, impermeability to oils and
greases and high meltin9 point. As such Nm is stream strippable: theyfind many uses in hospitals. They
are frequently used fl laminations. Acrylic films have resistance to ultra violet light and external
exposure, their prime use in surfacing laminations.
21
Present revolutionary trend in water management speaks about rip irrigation, which is developedin
Israel and is practiced by Agriculture Based Nation in the world. Drip Irrigation greatly deals with water
management techniques and uses pies as core tools for implementation with the service of this sort,
pipes leads the way in strengthening the hands of country economy.
Pvc Pipes In India :-
Chief occupation in India is agriculture. For the developing country like India, modernization ofthe
agriculture practices has a pivotal place in improving the economy states and the process of
modernization includes usage of high reductive tools and agriculture practices. By using pipes, water can
be transported efficiently with lesser no wastages, from the place where there is plentyof water
available to the place where there is no less scarcity necessity of water.
Pipes have been manufactured in India from the 1960‟s on imported lines and thereafter
indigenous plants were also established. There are few pip manufacture up to 1978-1 979 and
production capacity was increased drastically during 197-83.
Cement pipes were the conventional pipes used for irrigation in the lift irrigation schemes. Now a days
PVC pipe replaced the conventional pipes and they constitute almost 90% in this respect (because of
break downs, difficulty in zmovability etc. The usage of poly vinyl chloride pipes inagricultural fields has
lessened the water seepage which was predominant in earlier days.
The Government of India allowed the imports of sophisticated machinery of technology, which are not
available indigenously. The companies Europe and West Germany have competition in machinery
producing plastics and it is an essential need for them to carry out continuous researchfor the up-to-date
technology, which gives higher output and good quality products.
The state Government of Andhra Pradesh is using rigid PVC pipes for irrigation and watersupplies
for the past few years. The State Government is
producing PVC pipes through APSID (Andhra Pradesh State Irrigation Development Corporation) for its
lift irrigation schemes and other development schemes. The Panchayat rajDepartment is procuring
pipes for the public water supply schemes. The main distributors, subdistributors and individual
connections can use these Pipes
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Pipes Manufactures In Andhra Pradesh
The major Pipes manufactures in Andhra Pradesh,
1. Nandi Pipes
2. Finolex Pipes
3. Supreme Pipes
4. Monarch Pipes
5. Jam Sudhakar Pipes
6. Sri Lakshmi Venkataswara PVC Pipes
7. Hasthi pipes
Factors Contributing To The Boom Of Itl Pipes Market
1. Less weight
2. Non corrosiveness
3. Excellent pressure Resistance
4. Simple installation portability in handing
5. Super weathering and
6. Economical
Present Market Situation Of Itl Pipes
1. Existence of large number of firms
2. Product differentiation
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3. Freedom of entry and exit of firms
4. Easy availability
10benefits Of Itl Pipes :-
a. Corrosion Resistance
Amuse to galvanic or electrolyte corrosion
b. Chemical Resistance
ITL pipes are not attacked by low or high concentration of acids. Oxidizing agents, alkalisoils fats
and halogens
c .Maintenance Free
No painting coating required
d. Fire Resistance
Self extinguishing
e. Flexibility
Flexibility in underground piping
f. Variety of Joining Methods
Cementing, heat fusing, threading, flanged compression fitting.
g. Biological Resistance
Fit for high purity water applications and resistant to rodent attack vehicles. A unique cash out
flow justifies itself by providing good reputation of the company through customer service. The unique
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strength of the organization enables the delivery system to be efficient. Thisevent helps the dealer to
reduce inventory levels to the minimum.
10 https://www.scribd.com/document/56310300/Contents
Company profile:-
Rayalaseema in Andhra Pradesh was rarefied region for industries dynamic entrepreneur Sri
S.P.Y. Reddy is basically a mechanical engineer started a unit at Nandyal. Which manufacturesblack
pipes in 1977.The determination and hard work of Sri S.P.Y. Reddy helped him to overcome the
problems faced by the company in the initial years, and with financial assistance from the local
commercial banks. The company could overcome the problems of the manager and is running
smoothly.
11NANDI is brand name of popular ITL pipes made by two companies Sujala pipes and Rani Plastics
pipes industries. The companies was started in 1975 by a young mechanical engineer who had just left
a plum job in Baba Atomic Research(BARC) and wanted to do something onhis own.
Today the companies are worth few lot millions both Indian and American. They made possiblefew
other ventures pipes are sold under brand names of Nandi, Rani and sujala. Together they are selling
highest PVC pipe brands in south India and will be among top three.
We believe that companies are about people more than anything else. The group companies employ
about 1500 people. Free accommodation is provided to most of the employees. Health services are
also provided at free of cost. Other business interests of Nandi group include dairy product,
information technology and education ITL pipes (p) Ltd, manufacturers the largest andmost
comprehensive range of U-P.V.C PIPES in India. They offer pipes of up to 400mm diameter Nandi pipes
that are suitable for wide range of applications.
Portable water transportation, irrigation, plumbing, drainage, cable ducting bore-wells, Transfer of
industrial effluents. Our gamut’s of products cover all applications which are covered by PVCpipes.
Nandi UPVC are most cost effective than conventional GI, CI or AC system. They
are light weight, durable and noncorrosive. They offer excellent flow
characteristic and they are easy totransport handle and install as well. Excellent
quality with customize product development support11 www.nandipipes.com
25
.
The unit also has excellent quality assurance system in place we insure products of uncompromising
excellence, meeting all relevant ISI, BS, DIN and ASTM standards. In additionextensive R&D facilities
provide reliable and committed support for new product development.
This means that, even if a Nandi customer is unable to find his precise requirements fromour
elaborate range of products, we can also develop customized products to his own exclusive specifications.
It this relentless pursuit of quality and a willingness to adapt and innovate, that has propelledNandi to
the forefront of this product category in India.
Water is indispensable for agriculture. However, only 15 % of agricultural land, the world over, gets
dependable water supply. In India too, only a fraction of the 164 hectares of cultivated land gets a
dependable supply of water. Various irrigation methods are employed by farmers to ensureproper water
supply.
Canal irrigation is one such method. However, canals occupy cultivate space and thus hamper
production. Moreover, nearly 40% of canal water is wasted due to evaporation and percolation.
Besides, in certain areas, canal irrigation, over a period, has led to salivations. Pipes are an effective
way of overcoming the problem caused by canal irrigation as they can be laid underground and water
loss because of percolation and evaporation is eliminated. Lift irrigationis employed to carry water from
a lower to a higher level. Here, various kinds of pipes are used.
Growth :-
ITL Pipes limited is commissioned with the objectives of catering to the agricultural needs of the region,
in earlier days; tools used for water flow were very ineffective with high percentage of seepage losses.
To counter this draw bank PVC pipes were favorably welcomed, this has beenthe mission of ITL Pipes
Pvt limited. The major irritants on agriculture on agriculture practices like lack of rain fall. Ground water
lifting water transport within field provided magnificent thrust to PVC pipes market. These factors
helped ITL Pipes Pvt Ltd, to record an excellent growth since 1997 onwards quality is dominating factor
in the growth of sales. Well equipped laboratory and quality control office looks after the duality. The
company not only improving thebrand name but also it is undertaking takeover of the competitors
brands. In 1977 the company takes over the sagar brand. The manufacturing plant of sagar brand was at
Medak district. The ITL Pipes Company not slopped with that victory, the company over another main
competitors brand Monarch in 1999. The manufacturing plant of monarch plant lines Ananthpur
District.
The plants of the old companies are turned to opportunities to the company by its excellent
management. After the change of management the brand image of the brands are improved. At
present movement ITL Pipes Pvt ltd stands at market leader major competitor to the company is
Sudhakar pipes and maharaja pipes. The only back drop is the competition from local brands. As
26
a. Sizes:
Various sizes ranging from ½ to 10 are offered to consumers. Even pipes with different gaugesand
sizes are manufactured to suit specific conditions.
b. Packaging:
Packaging plays less important role in the product PVC pipes because the hallow space insidecan be
utilized for purpose of cubic space utilization in trucks while transport, organization is adapting
technique like pipe in pipe.
c. Warranties:-
No written warranties are given to consumers except an assurance that product is reliable.
For Nandi brand the company adopts zero credit policy, and goods are not delivered unlesscash
particulars are made.
For monarch and Sagar brands credit is entitled unto a week. The difference is due to brandimage.
General information about the company:-
The company is equipped with the sophisticated laboratory to carry on tests to ascertain out going
level of pipes. A Nandi pipes has got I. S. I trade mark, which speaks for itself the quality level of the
product. Managers at the company are dynamic and are well educated. Most of the skilled or unskilled
labor is duty minded. Company provides E. D. I and provident fund facilitiesto all its employees.
Uniqueness of workers of ITL Pipes Pvt ltd is their no indulgence union activities. As the company is
located in industrial estate of Nandyal. It is facilitated with good communications networks, which
includes telex, fax machine and Internet Company has also support of electronicdata processing.
The company‟ s major strength is considered to be transportation vehicles, Unique cash out howjustifies
itself by providing good reputation of the company through improved customer service.
27
Channels of distribution:-
ITL Pipes Pvt ltd has zero level channel distribution for and single level channel distribution forMonarch
and Sagar.
ZERO LEVEL
MANUFACTURIMG
CUTOMERE
MANUFACTURING
CUSTOMER
MA
REATILER
CUSTOMERE
NUFACTURING
28
ITL PIPES PVT LTD. Has an extensive network of consumers in Andhra Pradesh who aredirectly
serviced by company sales force and 500 consumers in south India.
Coverage :-
At present Andhra Pradesh, parts of southern states like Karnataka, Tamil Nadu and Kerala arein ambit
of ITL Pipes Pvt ltd.
THE FOLLOWING DATA SHOWS THE MARKET DEVELOPMENT FOR PVC PIPES OFITL PIPES PVTLTD.
1977-84 Nandyal regions (polythene pipes)
1984-85 Rayalaseema regions
1985-86 Rayalaseema and Telangana
1986-88 Karnataka and Andhra Pradesh
1988-91 Karnataka, Andhra Pradesh and Tamil Nadu.
1991-98 Karnataka, Andhra Pradesh, Tamil Nadu & Kerala
1998-2000 Karnataka, Andhra Pradesh, Tamil Nadu, Kerala & Goa
2000-02 Karnataka, Andhra Pradesh, Tamil Nadu, Kerala, Goa, Orissa, Uttar Pradesh,Pondicherry &
Yana am
Transportation vehicles of ITL Pipes pvt ltd are very admirable. This unique strength oforg
enables the delivery system to be efficient.
This even helps the consumers torn reduce inventory levels to the minimum. Thus consumers are
also supplemented with the benefit of the lower lied-up capital in the inventory.
General information about the company:-
The company is equipped with sophisticated laboratory to carry on tests to ascertain out going level of
the pipes. A Nandi pipes has got I.S.I trade mark, which speaks for the quality of pipes.Numbers of
statistical quality control techniques are applied to sustain the quality level of the
29
product. Managers at the company are dynamic and are well educated. Most of the skilled or
unskilled labour is duty minded. Company provides E.S.I, (employment state insurance) and
provident fund facilities to all its employees.
Uniqueness of workers of ITL Pipes pvt Ltd is their no indulgence union activities. As the company is
located in industrial estate of Nandyal. It is facilitated with good communication networks, which
includes telex, fax machine and internet. Company has also got the support ofelectronic data
processing.
The company s major strength is considered to be transportation vehicles. Huge investment ismade
on transportation vehicles, unique cash out how justifies itself by providing good reputation of the
company through improved customer service.
Financial department:-
Initially the company approached the external sources for financial aid: now the financial status of the
company is very sound and is being run only with self finance services, except loan taken on
hypothecation of machinery and stock from SBI Nandyal.
The financial manager with the help of four account officers clerks of the department heads ofthe
financial department. The company follows cash and carry policy for Nandi brand. The product is not
delivered until the cash is paid. Financial department with help of marketing department looks of
these transactions.
The marketing department is headed by marketing manager who represents to the executive
director, an assistant marketing manager whom reports marketing manager and 20 sales men
headed by 30 sales representatives who are headed by assistant marketing manager.
Marketing mix and advertising particulars of ITL Pipes Pvt Ltd. shows effective management of the
marketing of the marketing department in the organization.
The personnel department consists of the executives a worker of the organization.
The organization is formed with Sri S.P.Y Reddy as managing director. There are two marketing
managers, a financial manager, a public relation officer and a quality control officer who all reports to
executive director. Other than executives there are 1000 workers in the organization.
A panel considered of managing director, executive director and managers of concerneddepartments

makes the recruitment and selection of personnel.
The purchasing situation that is confronted by the manufacturers of the PVC pipes is scarcity ofresin.
Through the government of India has taken various steps to improve supply. The Indian manufacturers
could meet only 50% of demand and remaining 50 % is meet from imports.
30
The major petrochemical companies:
1. Sri Ram Vinyl ltd.
2. Chemical Plastic ltd.
3. Reliance petro Chemicals Ltd.
4. National
5. Gani Chemical industries Ltd.
6. Indian Petrol chemical Industries Ltd.
The Pride Of Itl Industry:-
ITL Pipes pvt ltd. The jewel of Nandi Group Of Companies under the dynamic and energetic
leadership of S.P.Y REDDY has been making rapid strides as the pioneering manufacturers of quality
PVC pipes for portable and irrigation water supplies.
The company has been consistently recording and excellent growth rate every year with the current
production capacity of 22,000 metric tons per annum. The plant is equipped with battened twin screw
extruders capable of producing pipes from 20mm 315 mm in o.25MPHs to1.0mpa pressure classes.
Stringent quality control tests are regularly conducted to ensure top quality products formulti
furious applications like tube well casing telephone educating aqua culture besides supplying to
various government aided schemes and medium irrigation process.
With a view to effectively cater to the needs of the international market, the company is gearingupper
I.S.O 9002 certification to become a number of select brand of elite group of companies. The company
is also manufacturing UPVC pipes and fitting specifications especially to meet requirements of the
middle-east market for soil, waste water and drainage systems and micro irrigation systems for dry
land.
Growing domestic agricultural and requirements of the modern world were in quest for thenew
substance, which could serve the needs and wants of the today s man. Although metals weremeeting
major chunk of the fabrication demand of the modern world, rework ability, formability and weight
constraints were real impediments. In light of this, the substance called plastics, which has got the
entire desired characteristic to serve the modern man, was discovered. This carbonaceous substance
with excellent rework ability and physical stability could replace most ofthe earlier used metals, wood
etc.
31
fiber in communication sects, fiber equipment is only little application in multi various use of theplastics.
Chief occupation in INDIA is agriculture. For the developing countries like, INDIA modernization of
the agricultural practices assumes preferable place improving the economic status and the processes of
modernization includes usage of high productive. Plastics supplementto greater extent manufacturing of
tools required for new agricultural practices. The usage of thepolyvinyl chloride in agricultural fields.
Lessen water seepage, which was predominating in earlier practices. With the services of PVC pipes,
water can be transported efficiently with lesserlosses, from the place of higher water potential to the
place of lower water potential.
Presently revolutionary trend in water management speaks much about agricultural basednations in
the world. Drip irrigation greatly used PVC as core
tools of implementation with the services of this sort. PVC pipes one way or the otherstrengthening the
hands countries economy.
Parts with the referred used PVC pipes supplemented with fittings are used in houses for electronic
connections, sewage connections and other domestic purposes. PVC pipes with much unique heat,
chemical and physical characteristics serve many industrial purposes. They are evenpositively used as
conduats for industrial gases. Even the characteristics of weight and low price attract many more
applications.
Rigid PVC pipes have been manufactured in INDIA from the 60‟s on imported extrusion lines and their
after indigenous plants were also available. There were few pipe manufacturers up to 1978-1979 and
large production capability was created during 1979-1983. When many extrusionlines were imported
from button field, Cincinnati, kraausmuffi etc. the govt allowed the imports of sophisticated and high
output plan which were not available indigenously.
It is essential for the company to carry out continuous research and development to update
technology, for higher output, loss energy cost per kg of output, quality of products etc.
A. Technical Details About Pvc Pipes Ingredients:

1. PVC RESIN
2. D.B.L.S
3. T.B.L.S
4. L.S
5. C.S
6. STEERIC ACID
32
7. HYDRO CARBON
8. CALCIUM CARBONATE
B. Nandi Pipes :-
For med in 1988, Types:-
a. Agriculture,
b. Blue casing (special),
c. Well casing,
d. Plumbing,
e. SWR,
f. Electrical,
g. Rinfit,
h. Sub Maribel,
C. Advantages of Nandi UPVC pipes:-
1) Corrosion Resistance.
2) No chemical contamination.
3) No need of protective Liners, coating, encasements or cathodes.
4) Protection of Thermal conductivity.
5) Flexibility.
33
6) Variety of jointing methods.
7) Nontoxic& Biological resistance.
8) High Hazen William x coefficient(150)
D. Organizational structure:-
Managing director
Board of directors
Financial manager
Production manager
Marketing manager
Personal relational officer
Accounts manager Regional
manager Personal officer
Quality controller
Production in charge
Accounts officer Sales
officer
Lab technician
34
CHAPTER- 3
RESEARCH METHODOLOGY
35
Research Methodology
Methodology :
Research methodology is a way to systematically solve the research problem .It may be understood as
a science of studying now research is done systematically. In that various steps,those are generally by
a researcher in studying his problem along with the logic behind them.
It is important for search to know not only the research method but also know methodology. The
problem by which researcher go about their work of describing, explaining and predicting phenomenon
are called methodology. Methods comprise the procedures used for generating, collecting and
,evaluating the data. All this it is necessary for the researcher to design his methodology for this
problem to problem.
Data collection is important step in any project and success of any project will be largely dependupon
now much accurate you will be able to collect and how much time, money and effort will be required to
collect the necessary data, this is also important step.
Data collection plays an important role in research work. Without proper data available for
analysis you cannot do the research work accurately.
Research Design:
The research that has been done is of analytical research. As the data that is required mainly isfrom
secondary source like annual reports of the organization, it is based on the analysis done from the
collected data.
Sources Of Data:
The present project work covers a period of five years 2012-2019 The project works is based onthe
data collected from primary and secondary source.
There are one of techniques
1. Secondary data
3.1. Secondary Data:

The secondary data collected from published and unpublished manuals, records, broacher, files,etc; of the
organization and books, journals, report etc;
36
Mangers and supervisors of the organization have also been interviewed to elicit necessaryinformation
on the structural schedules the secondary information was collected from the
company’s manual and office records pertaining to production, marketing, personal and financial
position.
Need For The Study:

Financial statement are prepare for the purpose of presenting a periodical review are report bythe
management and deal with the statements are affected by three things.
1. Recorded facts
2. Accounting conventions
3. Personal judgments
Scope And Period Of The Study:

The efficient allocation of capital is most important financial function in the modern times. It
involves decision to commit the firm’s, since they stand the long terms assetssuch decision are
of its value and by influence its growth, probability and growth.
The scope of the study is limited to collecting the financial data of NANDI PIPES for five years and
budgeted figures of each year.
A. They sell their goods or services to earn profits.

B. They raise fund to acquire manufacturing and other facilities.
C. Thus the three most important activities of business firm are:
Productio
n
Marketing
Finance
Objectives Of The Study:

To know cash flow during the period from operating, investing and financing activities
To evaluations the ability of the firm to meet obligations such as loan repayment, dividends,taxes etc
To discloses the reason for different among net incomes, cash receipts and cash payments
37
Limitations Of The Study:
Times is also a limiting factor study as the project is restricted to a period of 45days only.
The has been analyzed taking into considerations the information related to both the past andpresent
data reference to performance of the company.
As the time span of the study is gathering of information is possible.
There is very less scope for gathering the confidential data as the executive are very busy.
Cash flow analysis is a useful tool of financial analysis. However; it has its own limitations.
These limitations are as under.
payments.
38
CHAPTER- 4
LITERATURE REVIEW
39
Review Of Literature
Hamasalakshi and Manickam:
in their study on “Financial Performance Analysis of Selected Software Companies” examined

liquidity, profitability and leverage position of thirty four software companies during the period 1997-
1998 to 2001-2002 by using ratios, correlation and multiple regression analysis.The study revealed
favorable liquidity and working capital position. They concluded that the companies rely on the internal
financing and overall profitability position of the software companies showed a moderately increasing
trend.
Sudhansu Mohan Sahoo and Gom Karnath:
in their article on "Capital Structure of Indian Private Corporate Sector: An Empirical Analysis",
analyzed the capital structure of the Indian corporate sector and the factors thatdetermine the debt-
equity of the firms during the period 1980-81 to 2003-04. The study concluded that the firm is
significantly and positively to debt-equity ratio, asset
structure and profitability are the most significant factors deciding the capital structure.
Balakrishnan:
in his study, "Financial Performance of Public Sector Petroleum Industry", analyzed the
liquidity, solvency, profitability and predicted the financial position of the companies. He
concluded that the petroleum industry is in a healthy position.
Chalam and Prasad (2019):
attempted to evaluate fmancial performance of primary agricultural co-operative societies in Andhra

Pradesh, through scaling technique. The study concluded that out of nine co-operativesocieties, four
societies' performance were poor.
Jayaraj and Ilango (2017):
examined the determinants of textile exports in India during the period from 1981-81 to 2001-
02. The study concluded that the trade openness was the major factor than raw materials, power,
obsolete machines, technology up-gradation and demand in determining the exports oftextile goods.
40
Sankaran (2014):
in his study on "Identifying Discriminate Financial Factors between Well Run and Not Well-Run
Spinning Mills in Tami Nadu", analysid and identified factors which separate well run
from others for a period from 1991-2000, by using ratios, fund flow statement, discriminate
analysis and prediction model for the thirty
member mills of The Southern Indian Mills' Association. He arrived at the conclusion that thewell run
companies were able to meet long term funds and current ratio and expenses on employee have
significant influence in determining well and not well run companies.
Vunyale Narendra and Abhinav Sharma (2012):
argued that the public enterprises are utilizing internal sources of funds for expansion and
financing and do not utilize debt capital. The study further stated that they raised long term resources
for meeting short-term requirements. The study concluded that the public enterprisesare using
pecking order theory for capital structure policies
Sudarsana Reddy, Raghunatha Reddy and Mohan Reddy (2009):
examined the internal funds availability for financing fixed assets in paper industry of Andhra
Pradesh. The study found that the owner's funds were insufficient to finance fixed asset and
observed that fixed assets do not have significant relationship with the sales.
41
Eljelly (2007):
elucidated that efficient liquidity management involves planning and controlling current assetsand
current liabilities in such a manner that eliminates the risk of inability to meet due short- term
obligations and avoids excessive investment in these assets. The relation between profitability and
liquidity was examined, as measured
by current ratio and cash gap (cash conversion cycle) on a sample of joint stock companies in Saudi
Arabia using correlation and regression analysis. The study found that the cash conversioncycle was of
more importance as a measure of liquidity than the current ratio that affects profitability. The size
variable was found to have significant effect on profitability at the industry level. The results were
stable and had important implications for liquidity management in various Saudi companies. First, it was
clear that there was a negative relationship between profitability indicators such as current ratio and
cash gap in the Saudi sample examined. Second,the study also revealed that there was great variation
among industries with respect to the significant measure of liquidity.
Deloof (2003):
Discussed that most firms had a large amount of cash invested in working capital. It can therefore be
expected that the way in which working capital is managed will have a significant impact on profitability
of those firms. Using correlation and regression tests he found a significant negative relationship
between gross operation income and the number of days accounts receivable, inventories and accounts
payable of Belgian firms. On basis of these results
he suggested that managers could create value for their shareholders by reducing the number ofdays'
accounts receivable and inventories to a reasonable minimum. The negative relationship between
accounts payable and profitability is consistent with the view that less profitable firmswait longer to pay
their bills.
Chosh and Maji (2003):
In this paper made an attempt to examine the efficiency of working capital management of theIndian
cement companies during 1992 — 1993 to 2001 — 2002. For measuring the efficiencyof working
capital management, performance, utilization, and overall efficiency indices were calculated instead
of using some common working capital management ratios. Setting industrynorms as target-efficiency
levels of the individual firms, this paper also tested the speed of achieving that target level of
efficiency by an individual firm during the period of study.
Findings of the study indicated that the Indian Cement Industry as a whole did not perform
remarkably well during this period.
42
CHAPTER-5
DATA ANALYSIS AND

INTERPRETATION
43
Data Analysis & Interpretation:
Cash flow statement for the year ended 2012 -13Rs in lakhs
S. No Particulars Amount Amount
01 Cash flow from operating activities
Deprecation 71414
Income Expenses 119.03
Tax relating to earlier years 72194.83
Sale of Assets 1672.18
Sale of Investment 11.01
Interest income 203.46
Interest payment 1659.17
Cash generated from operations 3917.21
Leasing charges -
Net cash provided operating activities 151190.89
Cash flow from investing activities:
Purchase of fixed assets 90157.39
Sale of fixed assets 12404.28
Interest received 250
Purchase of investment 2.50
Sale of investment 19600
44
Net cash provided investing activities 122414.17
Cash flow from financing activities:
Loans terms borrowings 71940.57
Interest paid 5985.86
Un secured loans deposits 12.64
Working capital borrowings 71812.53
Dividend and tax on dividend paid 1574.94
Net cash provided financing activities 151326.57
Net decreasing in cash and cash equivalents (A+B+C) 122549.68
Net cash equivalents at beginning period 7072.47
Cash and cash equivalents at ended of period 5391.02
Interpretation:
1. From above statement it is clear that cash receipt from customer is

Rs151190.89.2.The amount from investing activities was Rs122414.17.
3.Net cash provided by the financing activities is Rs122549.68.
4.Cash and cash equivalent end of the period of 5391.02.
45
Cash flow statement for the year ended 2013-14Rs in lakhs
Deprecation 70838.52
Leasing charges -
Cash flow from investing activities
46
Interpretation:
1.From above statement it is clear that cash receipt from customer is Rs 136919.51.2.The
amount from investing activities was Rs194392.91.
47
Cash flow from operating activities
Deprecation 119.03
Leasing charges -
Purchase of investment 59000
48
Interest paid 13.27
Working capital borrowings 5800
Dividend and tax on dividend paid 59000
Net cash equivalent at beginning period 3982
Interpretation:

49
Cash flow statement for the year ended 2015-16 Rs in lakhs
Leasing charges 4288.72
Interest received 901.52
50
Net decreasing in cash and cash equivalents (A-B+C) 26455025.1
Interpretation:
1.From above statement it is clear that cash receipt from customer is Rs86850.61.2.The
amount from investing activities was Rs29909616.
4.Cash and cash equivalent end of the period of2992.04.
51
Interest payment -
Sale of investment 283.54
Cash flow from financing activates:
52
Interpretation:
1. From above statement it is clear that cash receipt from customer is Rs67464.81.2 .The
3 .Net cash provided by the financing activities is Rs604069.97.4
.Cash and cash equivalent end of the period of 6901.54.
53
Cash flow statement for the year ended 2017 -18Rs in lakhs
Deprecation 71414
DePrecation 80689.70
Sale of assets 80170.13
Cash flow from investing activities:
54
Interpretation:

55
Deprecation 119.03
Income expenses 69095.73
Sale of asste 6575.92-
56
Interest paid 13.27
Working capital borrowings 5800
Dividend and tax on dividend paid 59000
Net cash equivalents at beginning period 3982
Interpretation:
1.From above statement it is clear that cash receipt from customer is Rs77140.87.2.The
3.Net cash provided by the financing activities is 619569.24.
57
CHAPTER-6
FINDINGS, SUGGESTIONS, &
CONCLUSION
58
Findings, Suggestion & Conclusion
Findings:
1. It is found that in the year 2012-2013 cash from operating activities is more when compare
tothe investing financing activities.
2. In the year 2015-2016 there is high receipts from customers.
3. In the tear 2016-2017there increase trend see operating activities.
4. Net cash from operating activities151190.89 in the year if 2012-2013 and when the
comparethe year 2013-2014the operating activities decrease Rs136919.51.
5. Net cash from operating activities77140.87 in the year if 2014-2015 and when the
comparethe year 2015-2016the operating activities increase Rs86850.61.
6. It is found that in the year 2015-2016 cash flow from operating activities86850.61 when
theyear compare the year compare the year 2016-2017 the investing activities more than
decrease67464.81.
7. It is found that in the year 2012-2013 financial activities122549.68. When the year
comparethe 2013-2014 increase the Rs375226.22.
comparethe 2015-2016 increase the Rs26455025.1
comparethe 2016-2017 increase the Rs604069.65
.
Suggestions
I. The company should increase the profit

II. The company operating expense increasing regularly than previous year.
III. So, company should concentrate about operating expenses.
IV. Company should not maintain the thumb rules of concerned assets.
Stock positions of the company highly appreciate
59
.
Conclusion
As tool of financial management, the financial analysis is crucial significance. Financial analysis is
relvelant in assessing the performance of the firm in report of its liquidity position efficiently , cash flow
analysis and overall profitability.
However, financial statement fail to record qualitive event which are of great importance in assessing
the overall of a firm. Financial statement represent only the quantitative information. So the conclusion
that drawn based on the quantivative events may get distorted from the reality.Will lead company to
earn profit in the near feauture.
Bibliography
BIBLIOGRAPHY
1. M.Y. Khan and P.K. Jain FINANCIAL MANAGEMENT 4th Edition
. 2. I.M. Ponday , FINANCIAL MANAGEMENT 9th Edition, vikas publishing house private limitedNew
Delhi.
3. PRASANNA CHANDRA, FINANCIAL MANAGEMENT5th Edition, TATAMcGraw HILL, NewDelhi.
4. RajeswariRao K &prasad G, Accounting & Finance, jai Bharath Publishers.
5. Shashi k. Guptha "management accounting" 3rd edition, sahityabhavan publications.
red Accountants of India (published),Sahitya Bhawan (printed) ,Financial Management New Delhi
websites:
www.financialmanagement.com
www.srujalapipes.com
60

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CHAPTER-1

Background on a Cash Flow Statement

it helps in efficient cash management:

it helps in internal financial management:

1) To analysis the pattern of resources deployment in/out of assets.

Preparation of cash flow statement:

Sources of cash: sources of cash can be both internal as well as external.

II. Amortization of intangible assets:

IV. Gains from sale of fixed assets:

1. When all transactions are cash transactions and

2. When all transactions are not cash transactions.

Cash from operations = Net profit

When all transactions are not cash transactions:

1. Computations of funds (i.e. working capital) from operations as explained in the

Cash from the operations = Net profit + debtors outstanding at the

Beginning form Accounting year - debtors outstanding at the

cash from operations = net profit + decrease in debtors

Effect of credit purchases:

cash from operations = Net profit + increase in creditors

cash from operations = Net profit + decrease in creditors

CASH FROM OPERATIONS = NET PROFIT + INCREASE IN OUTSTANDING EXPENSES +

EFFECT OF PREPAID EXPENSES AND OUT STANDING INCOMES:

CASH FROM OPERATIONS = NET PROFIT + DECREASE IN PREPAID EXPENSES + DECREASE IN

The over all affect of stock, debtors, creditors, outstanding expenses

CASH FROM OPERATIONS = NET PROFIT + DECREASE IN DEBTORS + DECREASE IN STOCK +

1. INCREASE IN CURRENT ASSET

2. DECREASE IN CURRENT LIABILITY

3. RESULTS IN DECREASE IN CASH AND DECREASE IN CURRENT ASSET

4. INCREASE IN CURRENT LIABILITY

5. RESULTS IN INCREASE OF CASH

1.13. External sources of cash:

(A) Issue of new shares:

(B) Raising long term loans:

(D) Short term borrowings-cash credits from banks:

(E) Sale of fixed assets, investment, etc.:

It results in generation of cash and therefore, is a source of cash.

Applications of cash may take any of the following forms:

(a) Purchase of fixed assets:

(b) Payment of long term loans:

(c) Loss on account of operations:

Loss suffered on account of business operations will result in outflow of cash.

(d) Decrease in deferred payment liabilities:

(g) Decrease in unsecured loans, deposits, etc:

Utility Of Cash Flow Analysis:

(1) Help in efficient cash management:

(2) Help in internal financial management:

(3) Discloses the movements of cash:

(4) Discloses success or failure of cash planning:

Limitations Of Cash flow Analysis:

Each of them has a separate function to perform.

Limitations Of Cash flow Analysis:

classified into three

Classified cash flow

The two major types of plastics are:

Thermo setting resins

Thermo plastics resins.

Thermo setting resins:-

Structural foams:- It is of 2 types