financial analysis of cooperative society

Financial Analysis of Cooperative Society

Patel Dilipkumar

E d u P e d i a P u b l i c a t i o n s

Page i


(Special Reff. to Valsad and Dang District in Gujarat)

By

Patel Dilipkumar

M.Com, B.Ed

Research Scholar

Pacific Academy of Higher Education and Research University,

Udaipur (Rajasthan), India

ISBN-13: 978-1511654388

ISBN-10: 1511654384

Published and Printed by

EduPedia Publications Pvt. Ltd

New Delhi, India


Patel Dilipkumar


Page ii

Books Specifications

Book Title Financial Analysis of Cooperative Society

Author’s Name Patel Dilipkumar

Genre Non-Fiction, Finance and Investment

ISBN No. 978-1511654388

Language English

Publication Year 2015

Edition First Edition

No. of Pages 101

Page Size A4

Publisher EduPedia Publications Pvt. Ltd., New Delhi, India


Patel Dilipkumar


Page iii

Author’s Introduction

PATEL DILIPKUMAR

M.COM, B.ED

RESEARCH SCHOLAR

PACIFIC ACADEMY OF HIGHER EDUCATION

AND RESEARCH UNIVERSITY, UDAIPUR

(RAJASTHAN)

Email: [email protected]

mailto:[email protected]


Patel Dilipkumar


Page iv

ACKNOWLEDGEMENT

I am extremely thankful to Provide me Cooperative societies, Annual Report And all

confusion financial analysis regarding support Mr. Dhirubhai Kuvar, & Chintubhai

Manager of Selected Cooperative society., ( Guj.) and And Dhruva- Bife Under

Managed all Cooperative societies Financial Data provide me Officer’s Name Mr.

Jigneshbhai Patel And Shailesh Patel, Anandbhai, Maheshbhai, Devchanbhai in

Dhruva Bife : of Taluka Kaprada Office in Gujarat.

I am Very thankful to my PhD Guide Dr. Hetal Tandel, GIDC Rajju Shrof Rofel

Institute of Management Studies. To give me Valuable Advise for this Research

work.

I am Thankful to Prof. Alkaben Patel ,Arts and Commerce College, Motapondha to

Give Advice regarding this research work .

I am thankful to my Friends any time support to my this work so, heartily thanks

to Mr. Virendra Patel ,Sandip and Dharmesh Patel, Chandrakant Patel etc.

I am thankful to all my beloved family members for encouraging me and providing

all the necessary requirements; from financial support and motivation.

I express warm thanks to all who all have helped me a lot for my research work.

[email protected]

Author :

Patel Dilip kumar

mailto:[email protected]


Patel Dilipkumar


Page v

ABSTRACT

The present study of the research entitled “ Financial Analysis of Cooperative Society

”. The study was based on secondary data from records, and profile of the Cooperative

Societies. The Ratio analysis is the process of Observation the financial soundness and

cost effectiveness of the firm by establishing relationship between the items of balance

sheet and profit and loss a/c. The present study has thrown major concentration in ratio

analysis, from the 6 years balance sheet and profit and loss a/c. An objective of the

study includes the profitability Ratio, Structural ratios, Liquidity ratios, and Activity

ratio of Cooperative Societies in Dharampur, and Ahva taluk in south Gujarat in

India. Overall financial performance of the Cooperative Societies is discussed. Short

term-long term position is good in study period of the Selected Cooperatives. Suitable

suggestion was given by the researcher for a better soundness and cost effectiveness

& Test Hypothesis ‘T’ test has been applied.

Key word :

Ratio analysis, Profitability, Liquidity, Solvency, Activity, Financial health-

performance,


Patel Dilipkumar


Page vi

PARTICULAR Page No.

Acknowledgement…………………………………………………………………. iv

Abstract………………………………………………………….…………………..v

CHAPTER : 1 Overview of Co-operative Societies…………….…………………..1

CHAPTER : 2 Literature review of co-operative societies…………………………25

CHAPTER : 3 Research Methodology………………………………………………31

CHAPTER : 4 Data Analysis of Selected Cooperative societies…………………….36

CHAPTER : 5 Findings & Suggestion……………………………………………….81

Bibliography………………………………………………………………………….89

About the Author…………………………………………………………………….92


Patel Dilipkumar


Page vii

LIST OF TABLE

1 Debt Equity Ratio

2 Capital Gearing Ratio

3 Properatory Ratio

4 Fixed Capital- Assets Ratio

5 hypothesis test table Capital Structure Ratios

6 Current Ratio

7 Liquidity Ratio

8 hypothesis test table Liquidity Ratios

9 Gross profit Ratio

10 Net Profit Ratio

11 Operating Ratio

12 Return on Total Sale

13 Return On Capital Employed

14 hypothesis test table Profitability Ratios

15 Stock Turnover

16 Fixed Assets Turnover

17 Total Asset Turnover

18 Debtors Ratio

19 Current Assets Turnover

20 Working Capital Turnover

21 Hypothesis test table Activity Ratios


Patel Dilipkumar


Page viii

LIST OF GRAPH

1 Debt Equity Ratio

2 Capital Gearing Ratio

3 Properatory Ratio

4 Fixed Capital- Assets Ratio

5 Current Ratio

6 Liquidity Ratio

7 Gross profit Ratio

8 Net Profit Ratio

9 Operating Ratio

10 Return on Total Sale

11 Return on Capital Employed

12 Stock Turnover

13 Fixed Assets Turnover

14 Total Asset Turnover

15 Debtors Ratio

16 Current Assets Turnover

17 Working Capital Turnover


Patel Dilipkumar


Page ix

Chapter : 1 ( A)

(A.1) Overview of Cooperative society

(A.2) History of Cooperative society

(A.3) Types of Cooperative Society

(A.4) Advantage of Cooperative society

(A.5) Disadvantage of Cooperative society


Patel Dilipkumar


Page 1

(A.1) COOPERATIVE SOCIETY

A co-operative society is a voluntary association started with the aim of service

of its members. It is a form of business where individuals belonging to the same class

join their hands for the promotion of their common goals. These are generally formed

by the poor people or weaker section people in the society. It reflects the desire of the

poor people to stand on their own legs or own merit. The philosophy of the formation

of co-operative society is "all for each and each for all".

DEFINITION

1. According to Herrik,

"Cooperation is an action of persons voluntarily united for utilizing reciprocally their

own forces, resources or both under mutual management for their common profit or

loss."

2. According to Mr. Plunket,

"The cooperation is self help made effective by organization."

(A.2) History of Cooperative Society India

The cooperative movement in India owes its origin to agriculture and allied

sectors. Towards the end of the 19th century, the problems of rural indebtedness and

the consequent conditions of farmers created an environment for the chit funds and

cooperative societies. The farmers generally found the cooperative movement an

attractive mechanism for pooling their meagre resources for solving common

problems relating to credit, supplies of inputs and marketing of agricultural produce.

The experience gained in the working of cooperatives led to the enactment of

Cooperative Credit Societies Act, 1904. Subsequently, a more comprehensive

legislation called the Cooperative Societies Act was enacted. This Act, inter alia,

provided for the creation of the post of registrar of cooperative societies and

registration of cooperative societies for various purposes and audit. Under the

Montague-Chelmsford Reforms of 1919, cooperation became a provincial subject and

the provinces were authorized to make their own cooperative laws. Under the

Government of India Act, 1935, cooperatives were treated as a provincial subject. The

item "Cooperative Societies" is a State Subject under entry No.32 of the State List of

the Constitution of India.


Patel Dilipkumar


Page 2

After India attained Independence in August, 1947, cooperatives assumed a great

significance in poverty removal and faster socio-economic growth. With the advent of

the planning process, cooperatives became an integral part of the Five Year Plans. As

a result, they emerged as a distinct segment in our national economy. In the First Five

Year Plan, it was specifically stated that the success of the Plan would be judged,

among other things, by the extent it was implemented through cooperative

organizations.

(A.3) Types of The co-operative Societies in India

Cooperative societies may be classified into different categories fundamental

on the objectives, and purpose for which they are formed and nature of activities they

are reforming. When few cooperatives are formed to achieve to specific economic

objectives, others are came up with an objectives of social and economical status of its

members. Based on that the following are the forms of co operative societies which

have developed in India.

(1) Producers Cooperative society

These types of cooperatives are formed to assist the manufactures units in setting up,

production and marketing their products. It procures plants and machineries, raw

materials and other necessary items for facilitate the member in production of goods

and services. It also, at times, takes the responsibility of marketing the products

produced by the manufactures. Small producers are mainly benefited out of this

process. They are concentrating more and more on production and other are duly taken

care by the cooperatives.

(2) Consumer Cooperative society

Consumer’s cooperatives are formed with the objective of fulfilling need and

requirement of its member consumer by supplying goods and services at cheaper rate

by eliminating the middlemen. They develop relationship directly with the

manufactures, purchase the goods at wholesale price and sell them to members at

comparatively less than market price. The profit margin which the wholesalers and

retailers are supposed to enjoy are pass on to the members by the society, hence

charges less price from the members without compromising the quality.

(3) Marketing Cooperative society


Patel Dilipkumar


Page 3

It is an established fact that many a small producers are not successful in their projects

because they lack marketing skill and network. Quality production and cheap rate do

not come to their rescue in marketing. It is the marketing cooperative whose business

is the purchase all the goods produced by the small manufacturer and market them

when market is favorable or at different places where there is demand for the same.

The producer benefited by selling and society by earning commission from such sales.

(4) Housing Cooperative society

Affording to the basic need of a house or to have a land to construct a house is a

stupendous task on the part of a common man due to want of requisite fund, proper

facility, managerial ability and others. Housing cooperative society are those voluntary

association of members which engaged in acquiring land from general public, develop

the same, construct houses as per the requirement of members and transfer the

ownership in their favour. The members pays the price on easy installment basis, or

simple term loan basis some society also sells plots to their members.

(5) Credit Cooperative society

The very objective behind formation of a cooperative society is to make free the

people of down trodden society from the clutch of village money lender. In the name

of financial support, they have exploited the poor and needy people in many a ways,

thus poorer were not given opportunity to improve their socio-economic stand. Credit

cooperative come in their way. They have been assisting the poor farmers and needy

people of the society with the provision of soft loans, easy loans at comparatively

lower rate of interest and easy terms and conditions. In this process atheist,

exploitation of money lenders has been checked to a great extent.

Credit cooperatives are of two types namely:

i) Agricultural credit cooperatives, and

ii) Non-Agricultural credit cooperatives.

(6) Cooperative Farming society:

This society is formed by the farmers of a particular locality. Instead of going

for individual farming, they go for mass farming to get higher rate of return from

economies of scale. Combined they contribute land, labour, and capital in the field of

agriculture and share of benefits in a desired proportion among the members. This

process is more benefited because of (i) Mass production (ii) Maximum output, (iii)


Patel Dilipkumar


Page 4

Application of advanced technologies, fertilizers, seeds and others, (iv) pooled

resources fund, land and labour etc. (v) no financial crunch.

(A.4) Advantages of Cooperative Society

Following points indicate Advantage of Cooperative society

1. Mutual Cooperation :-

Cooperative society is very useful for creating the spirit of lovable Friendship and brotherhood

among the members of the society, which is the basic need of human beings.

2. Elimination of Middle economic person

The co-operative society eliminates the profit of the middleman. Because society purchases

goods directly from the producers and provides it on wholesale price to its members.

3. Financial Assistance :-

The cooperative societies also provide financial assistance to its members. For example in case

of house building for the purchase of inputs these provide loans.

4. Saving in Expenditure :-

A society is generally carried on by the members, so there is no heavy expenditure on

management. It reduces the coal of production.

5. Increase in Employment :-

The cooperative societies are providing job facility to thousands people in every country. So

these have reduced the rate of unemployment.

6. Equal Rights :-

All the members of the society have an equal rights and each member has one vote.

7. Equal Distribution of Wealth :-

Due to cooperative society the profit of capitalists reduces. The profit of middleman is also

distributed among the workers. So these societies remove the unequal distribution of wealth.

8. Tax Concession :-

It is an advantage that Govt. provides various concessions like super tax, income tax to the co-

operative societies.

9. Advantage for Farmer :-

The farmers can obtain their inputs like seeds fertilizers on low prices. They can also sell their

product at higher price through the co-operative society.


Patel Dilipkumar


Page 5

(A.5) Disadvantage of Cooperative Society

1. Lack of capital:

The co-operatives are launched by economically weaker sections of society. The shares are

generally persons may associate it these societies. The resources of co-operatives are limited to

the extent of capital contributed by the members and fund raising capacity from stated

cooperative banks.

2. Lack of efficient management:

The co-operative societies, because of their limited resources, are unable to secure the services

of efficient managers. They manage the society by its members who lacks managerial or

professional skills. In efficient management may not bring greater success over a period of time.

3. Lack of unity among member:

The members are drawn from different sections of the society. There may be lack of harmony

among them. The members do not understand the working of the societies, so they start

doubting each other. Some members lack interest in the affairs of the society and leave

everything to the paid officials.

4. Lack of motivation:

Co-operation brings an end to the feeling of individual self-interest. But men are selfish by

nature. Therefore, generally the members lack motivation to work more. Most of the time

‘everybody’ responsibility becomes no bodies’ responsibility.

5. Political interference:

The societies are normally under the regulations of the government. As co operative societies

stand in India, government even nominates members to the Managing Committees. Every

government tries to send their own party members to these societies. The societies are governed

on political consideration rather than on business lines. Political interference has badly affected

co-operative movement in India.

6. Difficult to maintain business secrecy:

The affairs of the co-operatives are very often no such exposed to the members that it becomes

difficult for them to maintain business secrecy. But secrecy is very important for success of any


Patel Dilipkumar


Page 6

Chapter : 1 ( C )

Introduction to financial analysis, understanding of income and

revenue, balance sheet, advantages of financial analysis, limitation,

and understanding of ratio analysis as a tool for evaluating financial

position.

(C.1) Meaning of Financial Statement :

Definition: Financial statements are a collection of reports about an organization's financial

results, condition, and cash flows. They are useful for the following reasons:

To determine the ability of a business to generate cash, and the sources and uses of that

cash.

To determine whether a business has the capability to pay back its debts.

To track financial results on a trend line to spot any looming profitability issues.

To derive financial ratios from the statements that can indicate the condition of the

business.

To investigate the details of certain business transactions, as outlined in the disclosures

that accompany the statements.

The standard contents of a set of financial statements are:

Balance sheet. Shows the entity's assets, liabilities, and stockholders' equity as of the

report date.

Income statement. Shows the results of the entity's operations and financial activities for

the reporting period.

Statement of cash flows. Shows changes in the entity's cash flows during the reporting

period

(C.2) Balance sheet

The balance sheet captures the financial position of a company at a particular point in time.

http://www.accountingtools.com/definition-balance-sheet

http://www.accountingtools.com/definition-income-statement

http://www.accountingtools.com/definition-cash-flows

https://www.boundless.com/definition/balance-sheet/


Patel Dilipkumar


Page 7

The balance sheet lists a company's assets, liabilities, and stockholders' equity (including dollar

amounts) at a specific moment in time.

There are two types of balance sheets, classified and unclassified.

A balance sheet is used externally and internally.

liabilities An amount of money in a company that is owed to someone and has to be paid in the

future, such as tax, debt, interest, and mortgage payments. asset Items of ownership convertible

into cash; total resources of a person or business, as cash, notes and accounts receivable;

securities and accounts receivable, securities, inventories, goodwill, fixtures, machinery, or real

estate (as opposed to liabilities).

(C.3) Profit and Loss Account

A profit and loss account is a record of the income and expenditure that a business has

generated over a specific period and either shows a profit (income exceeding expenses) or a loss

(where expenses exceed income).

"Usually you would only include the income and expenses relevant to the business activity. If

you were compiling a profit and loss account for your household, for example, you would

probably include things like council tax, utilities and water rates, but would not include the cost

of a takeaway."

Depreciation is also often shown in accounts. This is the cost of any large items of equipment,

machinery or vehicles that have been bought to last several years. The cost of these items is

spread over a number of years, a proportion showing in the accounts each year.

A simple profit and loss account would typically show income or turnover at the top and list

expenses and costs below.

Subramaniam says: "Making a detailed note of every transaction is time-consuming but can be

rewarding if there is an unexpected result.

"Depending on the purpose of the accounts, the level of detail will vary, with typically the date

being recorded along with the type of expenditure and of course the value itself."

https://www.boundless.com/definition/assets/

https://www.boundless.com/definition/liabilities/

https://www.boundless.com/definition/liabilities/

https://www.boundless.com/definition/asset/

https://www.boundless.com/definition/cash/

https://www.boundless.com/definition/account/


Patel Dilipkumar


Page 8

Subramaniam adds: "I would suggest that good books and records are kept from the outset

which should be updated on a regular basis. Avoid lumping large costs into the same headings

as this can be misleading.

"Choose the headings and selection of items going into these headings carefully as you need to

be able to identify what is in here. Don't be afraid of having lots of headings if you need to

analyse where your main costs are."

How often do accounts need to be compiled, and who needs to see them?

"Businesses usually have to produce them at least once a year for the year in question to comply

with the relevant tax legislation," says Subramaniam.

(C.4) Importance of Financial statements

The importance of financial statements in a business is great. There are several

difference reasons for a business to need financial statements. Yet first, financial statements

need to be explained in order to know how they are used.

Financial statements usually present the picture of the financial health of a given entity. It

is also critical that a business comes up with accurate financial statements, not only for their

record keeping for the purpose of satisfying external reporting expectations. In many ways,

financial statements offer an essential glimpse into the financial health of the business, but they

are only good for that specific period that they are used in (month, quarter, and year). These

statements are not only used by the company to see how the flow of business is going, but they

are also used by external users.

Financial Institutions- these are a group of banks and other lenders that use financial statements

to decide whether to help the company with working capital or to issue debt security to it.

Government- Financial statements are used by the government to analyze whether the tax paid

them is accurate and is in line with their financial strength.

Vendors- this group of people extend credit to a business and use statements to determined if


Patel Dilipkumar


Page 9

they business is credit worthy

These statements need to be accurate in order to help investors decide if they want to

invest in a business venture. They will also come up with detailed evaluations of the viability

and financial stability along with strength of the company before making the decision to invest

or not

(C.5) Limitations of Financial Statement Analysis

Although analysis of financial statement is essential to obtain relevant information for making

several decisions and formulating corporate plans and policies, it should be carefully performed

as it suffers from a number of the following limitations.

1. Mislead the user

The accuracy of financial information largely depends on how accurately financial statements

are prepared. If their preparation is wrong, the information obtained from their analysis will also

be wrong which may mislead the user in making decisions.

2. Not useful for planning

Since financial statements are prepared by using historical financial data, therefore, the

information derived from such statements may not be effective in corporate planning, if the

previous situation does not prevail.

3. Qualitative aspects

Then financial statement analysis provides only quantitative information about the company's

financial affairs. However, it fails to provide qualitative information such as management labour

relation, customer's satisfaction, and management’s skills and so on which are also equally

important for decision making.

4. Comparison not possible

The financial statements are based on historical data. Therefore comparative analysis of

financial statements of different years cannot be done as inflation distorts the view presented by

the statements of different years.


Patel Dilipkumar


Page 10

5. Wrong judgment

The skills used in the analysis without adequate knowledge of the subject matter may lead to

negative direction . Similarly, biased attitude of the analyst may also lead to wrong judgment

and conclusion.

The limitations mentioned above about financial statement analysis make it clear that the

analysis is a means to an end and not an end to itself. The users and analysts must understand

the limitations before analyzing the financial statements of the company.

(C.6) Financial ratio Analysis

There are several general categories of ratios, each designed to examine a different aspect of a

company's performance. The general groups of ratios are:

Structural ratios. This is the most fundamentally important set of ratios, because they measure

the ability of a company to remain in business. Click the following links for a thorough review

of each ratio.

o Cash coverage ratio. Shows the amount of cash available to pay interest.

o Current ratio. Measures the amount of liquidity available to pay for current liabilities.

o Quick ratio. The same as the current ratio, but does not include inventory.

o Liquidity index. Measures the amount of time required to convert assets into cash.

Activity ratios. These ratios are a strong indicator of the quality of management, since

they reveal how well management is utilizing company resources. Click the following links for

a thorough review of each ratio.

o Accounts payable turnover ratio. Measures the speed with which a company pays its

suppliers.

o Accounts receivable turnover ratio. Measures a company's ability to collect accounts

receivable.

o Fixed asset turnover ratio. Measures a company's ability to generate sales from a

certain base of fixed assets.

http://www.accountingtools.com/cash-coverage-ratio

http://www.accountingtools.com/current-ratio

http://www.accountingtools.com/quick-ratio

http://www.accountingtools.com/liquidity-index

http://www.accountingtools.com/accounts-payable-turnover

http://www.accountingtools.com/accounts-receivable-turnover

http://www.accountingtools.com/fixed-asset-turnover-ratio


Patel Dilipkumar


Page 11

o Inventory turnover ratio. Measures the amount of inventory needed to support a given

level of sales.

Leverage ratios. These ratios reveal the extent to which a company is relying upon debt

to fund its operations, and its ability to pay back the debt. Click the following links for a

thorough review of each ratio.

o Debt to equity ratio. Shows the extent to which management is willing to fund operations

with debt, rather than equity.

o Debt service coverage ratio. Reveals the ability of a company to pay its debt obligations.

o Fixed charge coverage. Shows the ability of a company to pay for its fixed costs.

Profitability ratios. These ratios measure how well a company performs in generating a

profit. Click the following links for a thorough review of each ratio.

o Breakeven point. Reveals the sales level at which a company breaks even.

o Contribution margin ratio. Shows the profits left after variable costs are subtracted from

sales.

o Gross profit ratio. Shows revenues minus the cost of goods sold, as a proportion of sales.

http://www.accountingtools.com/inventory-turnover-ratio

http://www.accountingtools.com/debt-to-equity-ratio

http://www.accountingtools.com/debt-service-coverage-ratio-ds

http://www.accountingtools.com/fixed-charge-coverage

http://www.accountingtools.com/breakeven-point

http://www.accountingtools.com/contribution-margin-ratio

http://www.accountingtools.com/gross-profit-ratio


Patel Dilipkumar


Page 12

Chapter : 1 ( D)

(D.1) Introduction of Selected Cooperative society Area Valsad district in

Gujarat and Management structure

(D.2) Introduction of Selected Cooperative society Area Dang district in

Gujarat and Management structure


Patel Dilipkumar


Page 13

(D.1) Shree Dhamni Vibhag Bagayati Sahkari Mandali Ltd

Taluk Dharampur and Dist Valsad

Valsad District Information :

Historical background we shall not forget entry of parses at Sanjan port for the first

time in India. Parsee community spread throughout India from Sanjan with their

famous religious place "Fire temple" at Udavada in Pardi taluka of Valsad district.

There is an ancient Jain pilgrim place at Bagwada on National Highway No.8 near

Udavada, where there is constant rush of pilgrims.

"Khed Satyagrah" and grass agitation launched by late Ishwarbhai Desai in

pardi taluka put it before the country and world. There is a largest industrial

estate at Vapi in Pardi taluka.

Valsad district was discussed at national and international level as it was

birth place of the Great person shri morarji desai, Bharat Ratna and Ex.prime minister

of India. A part from this valsad district is famous for valsadi aafus mangoes, world

famous chemical factories at Atul, largest industrial estate at Vapi, famous valsadi

teak-wood. Valsad district is situated on south of Gujarat. There is a Arabeen sea

in west. There are series of Sahyadri Mountains in the east. Valsad district has

population of 14,10,and 680 and has area of 2,947.49 sq.kms area. It has good

facilities and life style is good. It is a head quarters of Railway Defense Force and has

training centre. Railway administration at Valsad has important divisions like loco

sheds, dispensary, area manager office and vast railway colonies there is a vast


Patel Dilipkumar


Page 14

M.P.M.C. market for sales of agricultural production manages and chikoos.

Tithal village situated at a distance of 5 kms from valsad is being developed as

tourist place as well as pilgrim place. There are "Saibaba" temple in a splendid

complex, sadhana centre of Jain munis "Bandhu Triputi", "Shantiniketan Complex",

"Swaminarayan temple" of Akshar purushottam Bochasanvasi, etc, which neutrally

attract tourists of various fields. The reason is, Tithal has a pleasing sea-shore.

Dharampur taluka:

Different education level of five talukas of dist Valsad of Gujarat can be seen

.Base on the education level of the people, a variety can be seen in their languages, culture,

living standard etc has undergone a huge changes in last two decades to go. One cannot ignore

the opportunity in term of trade, religion, heritage, and industry in these areas under study. Even

today one can see the presence of traditional as well as modernization touch in the business of

these local areas. The areas are surrounded by lust green natural beauty covering the areas by

hill. Even till date, many areas are under developed. Due to bad economic condition, many

people are still living below poverty line. We find good presence to traditional system of

“HAAT” bazaar catching the heart of local peoples. People prefer to visit such bazaar for buying

their basic requirement .The political benefits has not reached this areas and that is also

responsible for underdevelopment of this areas. Considering all the above mention factors.

The Selected Cooperative Societies And Its Management :

Introduction and Background

Selected Dhamni Vibhag Bagayati Sahkari Mandali, at Dhamni village is an established on

30.11.2001. Past time this Cooperative Society Management has more challenge taken, because

this area because this area is highly rural area. But now Management Cooperative Society’s


Patel Dilipkumar


Page 15

Employee Very Honestly and Good working So, Every year this Cooperative Society Net

Profit Achievement. So this Cooperative society taken good Idea and Strong planning policy

has very well. This Cooperative society’s goal is tribal areas development and farmer’s welfare

activity. This cooperative society sales and Financial support by Dhruva Bife at Vansada taluka

in Lachhakadi.

Selected Cooperative society Management Committee :

Shree Tuljibhai Bhimjibhai Devaliya Precident

Shree Shivrambhai Somabhai Patara Member

Shree Maheshbhai K.Patel Member

Shree Tulshirambhai Kakadbhai daghav Member

Shree Ratnbhai Pangalbhai Dahwad Member

Shree Hirabhai Jatarbhai Raut Member

Shree Rajiram Soniyabhai Mokasi Member

Shree Maganbhai Somabhai Gound Member

Shree Barkebhai Bapjibhai Birari Member

Shree Chanubhai Gangaram Sindha Member

Shree Dhaylubhai Dhakalbhai Mahla Member

Shree Ratanbhai Chetabhai Vaghal Member

Shree Bapjibhai Lakhmabhai Gavli Member

Shree Dhirubhai Devjibhai Kuvar Member

Employee of Horticulture Cooperative Society

Shree Dhirubhai D.Kuvar Manager


Patel Dilipkumar


Page 16

(D.2) Shree Ambika Bagayat Utpadak Sahkari

Mandali Ltd,Jamlapada Taluka : Ahwa dist Dang

Dang District Information :

The Dang district is located in the southern part of the Gujarat state. To the north and

west of Dang lies Surat and Navsari districts of Gujarat whereas to its east and south are the

districts of the Maharastra state. The district of Dang lies between 20.39 degree to 21.5 degree

North latitudes and 72.29 degree to 73.51 degree East longitudes. The Dang is comprised of 311

Villages and has an area of 1764 sq. km. The land of the district is fertile and rocky. The colour

of the soil is either red or black. Maize, Rice, Groundnuts, Nagli (raggi), Euphorbia,etc. are the

major cultivation of this land. Wheat, Black Gram, Udad, etc are also grown in this soil.


Patel Dilipkumar


Page 17

History

There may be very few districts having their very own historical heritage. Dangs was

known as “Dakaranya or Dandak” during the period of Ramayana, and this is why its

folksongs are filled with stories of Ram and Sita. And Even today, the people of Dangs

greet each other saying “Ram-Ram”. However stranger a person may be, a greeting

with “Ram-Ram” would come naturally to its people.

Pandavas are also believed to have roamed and stayed in the Dangs. Even today one

can find a cave in Pandava village near Dangs. The kings of Maurya dynasty, King

San Praas, King Satya Vahan, and the kings of Kahatra and Abhir dynasties have ruled

this district. Its neighbours, the kings of Chanakya dynasty have also ruled it.

In the 14th century, the kings of Dangs got separated from the Mughals and

established their independent rule and this was the place where Shivaji established its

military base when he attacked Surat in 1664 AD. Even today, Shivaji’s military

establishment is known as “Lashkari Amba”. During the era of British rule, with the

help of the Marathas, the British convinced the rulers of Dangs to give them the

protection in the forests in return for a good administration in their state. In this way,

the rulers of the Dangs were deceitfully made the puppets in the hands of the British.

The Dangs District Population 2011

In 2011, The Dangs had population of 228,291 of which male and female were

113,821 and 114,470 respectively. In 2001 census, The Dangs had a population of

186,729 of which males were 93,974 and remaining 92,755 were females. The Dangs

District population constituted 0.38 percent of total Maharashtra population. In 2001


Patel Dilipkumar


Page 18

census, this figure for The Dangs District was at 0.37 percent of Maharashtra

population.

The Dangs Literacy Rate 2011

Average literacy rate of The Dangs in 2011 were 75.16 compared to 59.65 of

2001. If things are looked out at gender wise, male and female literacy were 83.06 and

67.38 respectively. For 2001 census, same figures stood at 70.68 and 48.51 in The

Dangs District. Total literate in The Dangs District were 140,968 of which male and

female were 77,314 and 63,654 respectively. In 2001, The Dangs District had 89,586

in its district.

Description 2011 2001

Actual Population 228,291 186,729

Male 113,821 93,974

Female 114,470 92,755

Population Growth 22.26% 29.59%

Area Sq. Km 1,766 1,766

Density/km2 129 106

Proportion to Gujarat Population 0.38% 0.37%

Sex Ratio (Per 1000) 1006 987

Child Sex Ratio (0-6 Age) 964 974

Average Literacy 75.16 59.65

Male Literacy 83.06 70.68

Female Literacy 67.38 48.51

Total Child Population (0-6 Age) 40,743 36,547

Male Population (0-6 Age) 20,743 18,510

Female Population (0-6 Age) 20,000 18,037

Literates 140,968 89,586

Male Literates 77,314 53,339

Female Literates 63,654 36,247


Patel Dilipkumar


Page 19

Child Proportion (0-6 Age) 17.85% 19.57%

Boys Proportion (0-6 Age) 18.22% 19.70%

Girls Proportion (0-6 Age) 17.47% 19.45%

The Selected Cooperative Societies And Its Management :


Selected Ambika Bagayat Sahkari Mandali,at Jamplapada village in Dang district is an

established on 23.03.2007. this area is highly rural area. But now Management Cooperative

Society’s Employee Very Honestly and Good working So, Every year this Cooperative

Society Net Profit Achhivement.So this Cooperative society taken good Idea and Strong

planning policy has very good. this Cooperative society’s goal is tribal areas development and

farmer’s welfer activity.this cooperative society sales and Financial support by Dhruva Bife

At Vansada taluka in Lachhakadi.


Patel Dilipkumar


Page 20

Selected Cooperative society Management Committee :

Shree Chinubhai Laxmanbhai Bhoye Precident

Shree Shantilal Lallubhai Birari Member

Shree Kolgabhai Devubhai Pawar Member

Shree Madhavrawbhai Ramabhai Palve Member

Shree Mansubhai Kalubhai Wagh Member

Shree Haribhai Jamsubhai Tumda Member

Shree Chhaganbhai R.Kahdole Member

Shree Niteshbhai Manubhai Dhoom Member

Shree Maganbhai Mahdubhai Kanat Member


Patel Dilipkumar


Page 21

Shree Hastirambhai Manubhai Bagul Member

Shree Devrambhai Mahdubhai Bhoye Member

Shree Manjulaben Maganbhai Chaudhri Member

Shree Bapjibhai Lakhmabhai Gavli Member

Shree Dhirubhai Devjibhai Kuvar Member

Employee of Credit Cooperative Society

Shree Chintubhai A Gavit Manager

The Selected Cooperative Societies And Its Management By

Dhruva Bife


Organizational Structure

VASUNDHARA was promoted by BAIF in 1995 as an independent organization to take

up marketing of the produce from the wadis. The set of organizations through which

procurement, processing and marketing of the produce from the wadis is managed

include:

BAIF/Dhruva, the promoting organization

The individual production units, the wadis or orchards owned by each tribal family,

SHGs for women which take up vermi-composting inputs for the wadi, as well

as marketing

The Ayojan Samitis, the informal village organizations which manage the processing

Their federations, the tribal co-operatives. VASUNDHARA, the mango and cashew

marketing co-operative is one of them. The marketing co-operative has processing

agencies for cashew and mango, for e.g. Kaprada for cashew and Vansda for mango

pulping and pickling.


Patel Dilipkumar


Page 22

Production Process

The production process involves the following steps:

1. Wadi Production*

2. Collection by Ayojan Samiti

3. Decentralized primary processing centers

4. Finishing unit in the co-operative – Vasundhara, Kaprada

5. Federated marketing team.

The produce of the wadis in the form of mango and cashew is procured by

the Ayojan Samitis. The quantities of mango are notified wadi wise to the Ayojan

Samiti, which fixes a particular date and time for the produce to be brought for

processing at the primary processing centers. This ensures that the fruit does not

perish due to lack of facilities in the temporary premises, the village schools in

this case, for processing of mango. On receipt of the semi-processed product the


Patel Dilipkumar


Page 23

marketing co-operative routes the payment to the individual wadi owners, with an

additional commission of one rupee per kilo to the Ayojan Samiti.

The Wadi IdeaWastelend Devlopment Activities

Tribals were migrating to work in nearby mango orchards, but the reality was, the

tribal farmers aspired to own the orchard that they worked in. The farmers each

typically owned 3-5 acres of wasteland. While some paddy was grown during the

monsoon, water was a scarce resource in the non-monsoon months because of the

undulating nature of the land. There was ample rain and the farmers had skill and

experience in growing mango, but the challenge was to supply a working model

that would transform the land of each farmer into a mango orchard

Dhruva coupled the skill of farmers with the agro-climatic suitability of the land to

come up with the wadi idea. Dhruva had to raise the capital for supporting the

activity of each wadi, as well as for fertilizers and pesticides for four years.

Starting with the tried and tested soil and water conservation methods, Dhruva

compensated farmers who took up soil conservation and pit digging activities on

their own land. Before planting mango, Dhruva experimented with various

different combinations of trees for maximizing returns and reducing risks. Mango

varieties were chosen with the market in view, but grafted saplings were used to

increase sturdiness and adaptability to the local terrain. An agricultural expert

from KFW, Germany, did a survey and recommended that cashew should be

included. Understanding the need for fodder in the cattle rearing area, fodder

plants were planted around the border. Eventually the farmer moved into the

orchard, and grew a kitchen garden for his family’s consumption.


Patel Dilipkumar


Page 24

11 tribal cooperatives have been established in DHRUVA’s operational area. Each

Cooperative covers around 10-15 villages. The members, both women and men are

participants of the Comprehensive Tribal Development Programme. The cooperatives

are involved in commercial and promotional activities needed for wadi produce such as

procurement, processing and marketing of agricultural produce of members mainly

mango and cashew, operation of Agro Service Centres, mango graft trading, roof tiles

trading, etc. Cashew processing remains the major activity of these cooperatives.

Selected Cooperative Society Under Covered

Villages

Dang District : Valsad District

Villages Name Village Name

1. Jamlapada 1. Dhamni

2. Barkhandhya 2. Mengha

3. Degadpada 3. Pengha

4. Khirmani 4. Tamchhadi

5. Bhadarpada 5. Hedari

6. Chikar. 6. Dhakval

7. Chichod 7. Makadbandh

8. Sadadmal 8. Veribhawada

9. Dhangadi

10. Uga-Chichpada 11. Kunda


Patel Dilipkumar


Page 25

Chapter – 2

Literature Review

Literature review of co-operative societies operating at international level, in India and

Gujarat.

Dr. Ruchira Prasad And Dr. Ruchira Prasad ( 2013 ) 1 in the article “A Case Study of

Amul Cooperative in Indian in Relation to Organizational design And Operational

Efficiency ” This research paper a relationship between the designs of an organization with its

operational efficiency indicators has been examined in the context of Amul.. The factors were

studied in context to a cooperative form of organization and while comparing with the corporate

form, it was found that the design of the basic structure is somewhat different as it believes in

the federal form of structure each unit is independent of each other. It is a popular belief that co-

operatives are a failure, but Amul with Co-operative Structure is a grand success. Amul has an

appropriate blend of policy makers, technology and a support system to the milk producers

without disturbing their agro-economic system and ploughing back the profits, by prudent use of

men, materials and machines.

Deepali Kapoor Suri* and Shilpi Singhal ( 2013)2 in the article “ Comparative Analysis of

Financial Perfomance of Indian Farmers Feertilizers Cooperative Ltd (IFFCO) ” The

study is an attempt being made to identify the financial performance and how the performance is

going on for the last five years, of Indian Farmers Fertiliser Co-operative Limited, popularly

known as IFFCO, on the basis of establishing relationship between the items of balance sheet

and profit &loss account. For establishing the relationship various types of ratios such as

solvency, liquidity, activity and profitability are used. The period of study is taken from the year

2007-08 to 2011-12.t can be concluded from the study of 5 financial periods of IFFCO that the

maximum Financial Indicators of IFFCO are not at a very good position. From the analysis of

main Financial Indicators it is clear that Operating Profit to Turnover Ratio, Fixed Assets

Turnover Ratio, Debt Equity Ratio, Current Ratio, Liquidity Ratio, etc are at a desirable

position. However, company’s Return on Capital Employed, Profit before tax to Turnover, etc

were undesirable as compared to Previous Years.

Anil Kumar Soni and Dr. Harjinder Pal Singh Saluja ( 2012)3 in the article “ Role of

Cooperative Bank in Agricultural Credit : As Study Based on Cahhattisgarh ” The


Patel Dilipkumar


Page 26

cooperative banking sector is one of the main partners of Indian banking structure, the

cooperative banks have more reach to the rural India, through their huge network of credit

societies in the institutional credit structure. The cooperative sector has played a key role in the

economy of the country and always recognized as an integral part of our national economy.

Cooperatives have ideological base, economic objects with social outlook and approach. The

cooperative covers almost all cent percent villages in India. The cooperative form of

organization is the Ideal Organization for economically weaker sections in the country.

According to recent study by World Bank and National Council for Applied Economic

Research, the Primary Agriculture Credit Societies (PACS) amount for about 30 percent of

micro credit in India. This paper attempts to analyze the role of co-operative bank in agricultural

credit.

Dr. M. S. Ramananda And Dr. M. Jayaprakash ( 2012) 4 in the article “ Impact on

Vydhanadhan Committee Recomadations Of Wangaplly Primar Agricultural Cooperative

Credit Society ” This study was an attempt to decipher the factors, which contribute to the

financial health of the PACS, which form the base of the short-term cooperative credit structure

prevalent in India. The study considered recovery performance of the PACS as the most suitable

indicator of their performance. The results indicate that as the PACS have drifted from some of

the core principles of cooperation, their recovery performance has suffered. As membership size

has grown over the years in case of the PACS, their recovery has taken a beating because peer

pressure, which ensures recovery, has gradually weakened. Thus there is a need to relook into

the issue of optimal member size of the cooperatives in the interest of their viability. In

conformity with popular perception, government‟s contribution to the share capital is found to

be detrimental for the recovery performance of the PACS. Government‟s contribution in share

capital not only gives it a hand to meddle with the affairs of the PACS; it might also be inducing

indulgence amongst members because of the comfort of government bail out in case of

difficulty. The latest amendment in the Vaidyanthan Committee‟s recommendation that

Government can retain 25 per cent of equity capital in case of PCAS needs to seriously given a

second thought. The attempt should be either to completely dislodge government equity in the

PACS or not to consider the PACS as cooperatives but to accept them as quasi government

ventures for which the parameters of performance needs to be revisited. The study also found

that as deposits grow in proportion to borrowings, the recovery performance is adversely

affected.


Patel Dilipkumar


Page 27

Dr.Murali Vallapureddy (2013)5 in the article “People of rural India face a lot of hardships

to earn livelihood. This study on “Performance of Women Cooperative Dairy – A Study on

Mulkanoor Women Cooperative Diary in Andhra Pradesh”, the MWCD (Swakrushi) is a

promising community enterprise in enhancing livelihoods of large numbers of rural producers. It

began its operations in Aug’ 2002 and in Mar’12, it has been providing services to its 20,118

members. The aim of the study is an attempt to identify the various factors/dimensions that have

contributed to the growth of this rural women initiative. The focus on analysis of the growth

path is particularly important as the development sector is trying more and more to discover the

process of enhancing large number of livelihoods for rural poor Today the Mulkanoor

cooperative society is having 20,118 members, 109 societies, 68 employees (in the economic

year 2011-12 annual report). Thus, Mulkanoor cooperative society is the role model in the

country and there is need of sincere efforts to strengthen the cooperative societies in India on the

same line, if we are concern to meet the demand of food, cloth, shelter and employment to our

increasing population.

Dr. M.S. Ramananda ( 2012)6 in the article “ Ratio Analysis of Hydrabad Agricultural

Cooperative Association Operational Functions ” This study is based on secondary sources

only. The secondary data were collected from HACA office, HACA Bhavan, published,

unpublished and Internet. The study period was during the year 2004 to 2009. The HACA

operational aspects as per the data analysis it was not uniformly distributed among the years.

During the reference period the HACA data analysis showed negative ratios could be observed.

The shareholder's capital has risen quite a bit if you compare the balance sheet numbers versus

the previous year. Again this could mean a number of things, there are a couple reasons that this

could have happened. Perhaps they've made acquisitions which were partially paid for through

the issue of stock, or maybe they took on additional share capital from another firm. Another

possible reason is that they had to issue more shares because they were strapped for cash. For

the most part a rise in share capital is better than a rise in debt, but too much of a rise could be

cause for alarm.

Narayana Gowd Talla , Anand Bethapudi and Reddeppa Reddy G.( 2011) 7 in the project

“ An Analytical Study on Financial Perfomace of Dharmavaram Cooperative Bank,Ap,

India ” The concept of “Financial Inclusion” is inbuilt in the structure of Urban Co-operative

Bank. As Urban Co-operative Banks are mostly working in the rural and semi-urban areas .They

are the back bone of banking system and contribute for growth of the nation .The researcher


Patel Dilipkumar


Page 28

aims to investigate the financial performance of Dharmavaram Urban Cooperative bank. The

study employs exploratory research design which relies on secondary data. The analyzed data

reveals that there was significant growth in the deposits mobilization, membership, loans and

advances, working capital, reserves, owned funds, Total income, Total expenditure and over

dues with reference to DUCB. There is no significant growth in share capital per member with

CGR of 4.50.There was no significant increase in the total cash with the bank which is growing

at CGR of 2.54.There was no significant growth in CDR with a CGR of 11.02.There was

significant difference in the growth and composition of income. The total expenses were

increasing significantly with CGR of 9.68. Even though there was increasing trend in the Total

income earned during the study period except in the year 2006-07 it was statistically significant

with CGR of 7.13 but the EPS of DUCB was not enhanced which is statistically in significant

during the study. Therefore the performance of DUCB was moderately satisfactory. For

improving its performance, it has to concentrate on recovery performance, controlling expenses,

robust risk management practices and diversifying their operations.

Ramesh Chander ( 2010) 8 in the research “ Financial Viability And Perfomace Evaluation

of Coperative Credit Institutions In Hariyana ( India ) ” Co-operative Banks are organized

and managed on the principals of co-operation, self-help, and mutual help. These have been

playing imperative role in Indian financial system with broad network in both urban and rural

areas. Around three hundred and seventy two District Central Co-operative Banks (DCCBs)

with large number of branches and extension counters cater to the needs of nearly one lakh

societies in rural India. In Haryana nineteen DCCBs with more than two hundred branches have

been facilitating self-sufficiency in food grain production, creation of better employment

opportunities and organizational strength to the rural people through banking services. Recently,

the scams in co-operative sector, failure and closure of unviable branches, imposition of penalty

by the regulators and payment of heavy money claims due to bankruptcy of co-operative banks

etc. are few significant reasons which persuade to inquire into the financial affairs of these

institutions. Many co-operative banks became insolvent and others are on the brink of mergers

or acquisition. The present study was conceptualized to examine the financial viability,

efficiency and performance of four DCCBs operating in Gurgaon division in Haryana (India),

viz. Gurgaon, Faridabad, Mahendergarh and Rewari for a period of twelve years (1997-98 to

2008-09) by financial analysis and z-score analysis. The financial parameters here taken are

profitability, liquidity, efficiency, solvency, risk and bankruptcy.


Patel Dilipkumar


Page 29

Paul Trupo (1997)9 in the article “ Agricultural Cooperation and Horticultural Produce

Marketing in Southwest Virginia ” This study methodology used in this research include

surveying and interviewing marketing specialists, co-op managers, growers, extension agents,

horticulturists, and other experts involved with both successful and failed cooperative efforts.

The data gathered from these interviews has been used to identify key factors that have

contributed to the success or failure of the other cooperative efforts. Based on the key factors

identified from the research, a specific cooperative structure has been developed for the

Southwest Virginia growers. This organizational structure incorporates into its legal

documentation (bylaws, business plan, and marketing agreement) the critical factors that must

be carried out by members, management, extension, and marketers in order to increase the

probability for the cooperative’s long-term survival and profitability.

Kareem, R.O, Arigbabu, Y.D, Akintaro, J.A & Badmus, M.A(2012)10 in the research “ The

Impact of Co-Operative Society on Capital Formation (A Case Study of Temidere Co –

Operative and Thrift- Society, Ijebu- Ode, Ogun State, Nigeria)This study is on the impact

of co-operative societies on capital formation using a casestudy of Temidere-co-operative and

Thrift-society, Ijebu-ode, Ogun state. The objectives are to: identify the socio-economic

characteristics of the cooperators in the study area; identify the uses of funds of co-operative

societies; determine to what extent co-operatives have benefited members in financing their

investments; identify problems militating against the effectiveness of co-operative societies; and

offer suggestions and recommendations on how to improve the cooperative societies towards

enhancing the capital formation of members. The study adopted a non parametric method of

analysis which involved Chi-Square method, descriptive statistics and correlation analysis to

achieve the stated objectives.

Dr. Kaneez Fatima Sadriwala and Dr. Ayoob.C.P. ( 2004) 11 in research “ Efficiency

Structure of Co-operative Agricultural Marketing Societies - A Case Study of Coconut

Marketing Societies of Kerala State” One of the peculiar features of the Kerala's coconut

sector is that it is cultivated in homestead land and most of the growers are tiny or marginal

farmers. Coconut marketing here is unorganized. It is cultivated in an area of 9.36 lakh ha,

which is about 50 per cent of the total area under coconut cultivation in India. The annual

production of coconut in the State is 5,496 million nuts, which is 44.00 per cent of the total

production in the country. Lack of irrigation is one of the major reasons attributed to the low

level of productivity of coconut in Kerala State. Scarcity of irrigation water is also considered as


Patel Dilipkumar


Page 30

one of the major constraints in resource use management in coconut farming in Kerala. This

paper attempts to examine the efficiency structure of co-operative marketing societies which are

involved in the coconut marketing in Kerala. In cooperative organizations efficiency structure

contains a combination of different factors such as financial performance of the societies,

membership strength and their attitude towards the society, procurement and marketing of

agricultural produce, Input supply, infrastructure supply, Link with apex body etc,. From the

analysis of the efficiency structure of coconut co-operative marketing societies in Kerala, it can

be inferred that (1) in general, the efficiency level of the coconut marketing societies in the state

is above medium (2) when comparing the efficiency level of the societies among the different

affiliations, it shows that; (a) there is significant differences in the level of efficiency of the

coconut co-operative marketing societies affiliated to single apex societies (Kerafed or

Marketfed) ;and both the apex bodies.


Patel Dilipkumar


Page 31

Chapter – 3

Research Methodology

(3.1) Title Name of Study

(3.2) Research area of Organization

(3.3) Importance of the Study

(3.4) Scope of the study

(3.5) Research Gap

(3.6) Object of Proposed Study

(3.7) Testing of hypothesis

(3.8) Source of Information

(3.9) Tools of Data Analysis

(3.10) Limitation of the study

(3.11) Chapterization


Patel Dilipkumar


Page 32

(3.1) Title of the Study :


( Special Reff. to Valsad And Dang District in Gujarat )

(3.2) Area :

a) Organisation :

Shree Dhamni Vibhag Bagyati Sahkari Mandali Ltd,Dhamni

Village .,Valsad District

Shree Ambika Bagayat Sahkari Mandali Ltd,Jamlapada village,

Dang District

b) Details of the Selected Areas:

Brief of the area selected for the Study considered as a backward area

falls under Selected Valsad. And Dang district of Gujarat State of India.

(3.3) Significance of the Study :

Today’s world had become very competitive. In each field thousand’s of

competitors has entered the market. In the changing market scenario equipped with

science and technology, they are struggling to survive in the market, whether it is a field

of knowledge, business or any other Profession. Even the Indian economy is not free

from the air of liberalization, privatization and globalization. The public sector has to

become more active and should also take necessary measures to fit them in the changing

economic scenario. With this objectives in mind the research on “Shree Dhamni Vibhag

Bagayti sahkari Mandali Ltd And Shree Ambika Bagayat sahkari Mandali. is

undertaken. Where the financial performance of the same will be conducted keeping the

current situation on the top. A study on the problem faced and its relevant solution, so

that the people of these areas get good service from this co-operative society. This co-

operative society can act as a role model to be followed by other society of the South

Gujarat. Of Gujarat state’s Other co-operative society can follow the management

system for improving the financial position of the society.


Patel Dilipkumar


Page 33

(3.4) Scope of the Study:

A part from the selected co-operative societies, a similar study can be conducted

for other co-operative societies of taluka of Dharampur ( Valsad) and Ahva taluka (

Dang) They are as follow :

Various service co-operative Society

Credit Cooperative society

Handicraft Industry

Consumer Cooperative Society

Processing Cooperative Society

Milk Cooperative society.

For the study purpose, researcher have selected One this area most successful

working Co-operative Society of Valsad District & Dang District of Gujarat state

.There are lot of scope for any researched to conduct the study for above mentioned

society The present study will focus only on financial analysis of the co-operative

society; one can also conduct the study on same co-operative society, but from different

angle like, marketing of the product falls under the preview of the society. Other

opportunities can also be explore for the product. Identifying the problems face by the

society or comparison between one or more co-operative society can be undertaken.

Even comparison between one taluka co-operative society of same category can be done

with similar type in some another taluka of same district or can also opportunities for

some another district or state.

(3.5) Research Gap:

After reviewing the literature related to co-operative society published in

various newspaper, journal, magazine and periodic etc, researcher has conducted the

study based on financial data, where various financial tools for analysis the financial

position of the co-operative society will be used. The study is limited to one Credit co-

operative society. The data relevant and useful for the study will be collected from

financial data prepared by the co-operative society. If required, from time to time a

personal visit to the selected co-operative society will also be done, so as to gather

more information related to its activity and function.


Patel Dilipkumar


Page 34

(3.6) Objectives of the proposed study

To understand the working of Co-operative Societies Dang and Valsad district.

To study the financial performance of selected Co-operative Societies.

To make comparative study of the selected Co-operative Societies.

To make suggestions for the betterment of the Co-operative Societies in general and

selected co-operative societies in particular.

(3.7) Hypothesis Test of The Study :

Ho There is no significance difference in the various financial ratios of

Dhamni and Jamlapada Cooperative societies.

H1 There is significance difference in The various financial ratios of Dhamni

and Jamlapada Cooperative societies.

(3.8) Source of Information:

Personal talk with the chairman of the selected co-operative society.

Personal talk and Discussion with Mr. Dhirubhai D.Kuvar And Chintubhai Gavit

( Manager)

Personal talk with the accountant of the selected co-operative society.

Visit to the district Information department center of Selected district.

Members of the co-operative society.

Other documents related to the study will be used:

Newspaper

Monthly Magazine

Gram Swaraj Magazine

Radio Programme related to the farmer

Books/literature/research papers/articles etc

Internet

Research conducted by other state co-operative society

(3.9) Tool of data analysis and methodology :

Ratio Analysis & Trend Analysis

Hypothesis ‘ T ’ test Applied


Patel Dilipkumar


Page 35

(3.10) Limitation of the Study

1. The study has been conducted over a limited period of ( 6) Six years only.

2. The study is mainly based on secondary data.

3. The study is limited to a two Selected Cooperative society only.

4. The study is based on consolidated financial statement, which may lead to some

errors and assumptions.

(3.11) Chapterization :

The research is conducted in the district Valsad And Dang of Gujarat

State and for the same the study is divided into six (06) chapters as under:

Chapter 1 : Overview of Co-operative Society.

(A) Introduction to the co-operative society ,meaning of cooperative society, history

background of cooperative society ,different type of cooperative society,

Advantages of co-operative society to the people,dis-advantages,

(B) Introduction to financial analysis, understanding of income and revenue, balance

sheet, advantages of financial analysis, limitation, and understanding of ratio

analysis as a tool for evaluating financial position.

(C) Understanding of the selected co-operative society, information related to Selected

taluka,working and function of the selected co-operative society and its

management.

Chapter 2 : Literature review of co-operative society operating at

international level, in India and Gujarat.

Chapter 3 : Research Methodology

Research area, Importance of the study, its objectives and

hypothesis, Source of data collection, research gap , Scope of the

Study, types of study, chapterisation, data collection and

limitation of the study.

Chapter 4 : Data Analysis of last 06 years of the selected

Co- operative Society

Chapter 5 : Findings and Suggestions.


Patel Dilipkumar


Page 36

Chapter – 4

Data Analysis

Financial Ratio Analysis of Selected Cooperative Society :


Patel Dilipkumar


Page 37

Introduction of Financial Ratios :

Financial ratios are used to evaluate a company- Its Financial Strength, Management

effectiveness, Efficiency and Profitability.

Ratios look at the fundamental financial aspects of the company. It gives you an idea

about –

The current financial position of the company

where the company ranks among its peers and if it is properly priced by the

market as reflected in its stock’s price

Overall, it helps you to decide if a particular company is worth getting involved

with.

(A) SOLVENCY RATIO :

The solvency ratio is only one of the metrics used to determine whether a company can

stay solvent. Other solvency ratios include debt to equity, total debt to total assets, and interest

coverage ratios. However, the solvency ratio is a comprehensive measure of solvency, as it

measures cash flow – rather than net income – by including depreciation to assess a company’s

capacity to stay afloat. It measures this cash flow capacity in relation to all liabilities, rather than

only debt. Apart from debt and borrowings, other liabilities include short-term ones such as

accounts payable and long-term ones such as capital lease and pension plan obligations.


Patel Dilipkumar


Page 38

1. DEBT EQUITY RATIO :

The debt-to-equity ratio is a financial ratio indicating the relative proportion of entity's

equity and debt used to finance an entity's assets. This ratio is also known as financial

leverage.Debt-to-equity ratio is the key financial ratio and is used as a standard for judging a

company's financial standing. It is also a measure of a company's ability to repay its obligations.

When examining the health of a company, it is critical to pay attention to the debt/equity ratio.

Table : 1 Debt Equiety Ratio of Dhamni And Jamlapada Cooperative Society

Dhamni Cooperative Society Jamlapada Cooperative Society

YEAR TOTAL

DEBT

NET

WORTH

RATIO IN TOTAL

DEBT

NET

WORTH

RATIO IN

PERCENTA

GE

PERCENTA

GE

2008-09 878165 1073321 0.82 292355 250092 1.17

2009-10 240879 1498177 0.16 262559 459572 0.57

2010-11 387437 2237290 0.17 177074 928252 0.19

2011-12 390330 3095043 0.13 107389 1339638 0.08

2012-13 373334 2745043 0.14 106791 1667833 0.06

2013-14 379434 2745043 0.14 15788 1761290 0.01

Source : Compiled Calculated Data

Interpretation

The table 1 reveals that the Debt Equity ratio of Dhamni Cooperative Societies was

Highest ratio from 0.82 in the year 2008-09. It was at 0.13 ratio in 2011-12, lowest among Six

years. But the ratio in case of Jamlapada Cooperative Societies has discreased over the six

years. It was at its lowest in 2013-14 ( 0.01), after that it has shown almost low increment

every year in Debt equity ratios. from the above it can be concluded that Debt equity position of


Patel Dilipkumar


Page 39

dhamni Cooperative society is better than Jamlapada Cooperative Society.because Jamlapada

Co.society not maintain ratio every year.

Graph : 1 Debt Equity Ratio

0.00

0.50

1.00

1.50

2.00

2.50

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

Jamplapada RATIO INPERCENTAGE

Dhamni RATIO IN PERCENTAGE


Patel Dilipkumar


Page 40

2. GEARING RATIO :

The gearing ratio is the proportion of a company's debt to its equity. A high gearing ratio

represents a high proportion of debt to equity, and a low gearing ratio represents a low

proportion of debt to equity. This ratio is similar to the debt to equity ratio, except that there are

a number of variations on the gearing ratio formula that can yield slightly different results.

Table : 2 Gearing Ratio of Dhamni And Jamlapada Cooperative Society


Interpretation

The table 2 reveals that the Gearing ratio of Dhamni Cooperative Societies was

Highest from 7.77 in the year 2008-09. It was at 1.58 ratio in 2009-10, lowest among

Six years. But the Gearing ratio in same case of Jamlapada Cooperative Societies has

highest ratio was 4.53 in 2013-14 & 2008-09. It was at its lowest in 2012-13 (1.49 ),

after that it has shown almost average every year in Gearing ratios. from the above it

can be concluded that Jamlapada horticulture Cooperative society position of

Average because no Maintain every year ratio. And Dhamni is maintain average..


YEAR Short +

Long

te.Debt

Share Equity RATIO IN Short +

Long

te.Debt

Share Equity RATIO IN

PERCENTAGE PERCENTAGE

2008-09 1183613 152300 7.77 292355 64600 4.53

2009-10 240879 152300 1.58 262559 65100 4.03

2010-11 387434 152300 2.54 177074 65300 2.71

2011-12 390330 152300 2.56 107389 71450 1.50

2012-13 373334 152300 2.45 106791 71450 1.49

2013-14 379434 152300 2.49 292355 64600 4.53

http://www.accountingtools.com/debt-to-equity-ratio


Patel Dilipkumar


Page 41

Graph : 2 Gearing Ratio

3. PROPERATORY RATIO :

The proprietary ratio is the inverse of debt ratio. It is a part to whole comparison. The

proprietary ratio measures the amount of funds that investors have contributed towards the

capital of a firm in relation to the total capital that is required by the firm to conduct operations.

7.77

1.582.54 2.56 2.45 2.49

4.53

4.032.71

1.50 1.49

4.53

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

JAMLAPADA RATIO IN PERCENTAGE

DHAMNI RATIO IN PERCENTAGE


Patel Dilipkumar


Page 42

Table : 3 Properatory Ratio of Dhamni And Jamlapada Cooperative Society


YEAR NET

WORTH

TOTAL RATI

O NET

WORTH

TOTAL RATI

O

RESPONSIBILIT

Y

RESPONSIBILIT

Y

2008-09 1073321 1183613 90.7 292355 295000 99

2009-10 1498177 240879 622.0 459572 262559 175

2010-11 2237290 387434 577.5 928252 177074 524

2011-12 3095043 390330 792.9 1339638 107389 1247

2012-13 2745043 373334 735.3 1667833 106791 1562

2013-14 2745043 379434 723.5 1761290 15788 11156


Interpretation

The table 3 reveals that the Properatory Ratio of Dhamni Cooperative Societies was

Highest from 792.9 in the year 2011-12. It was at 90 ratio in 2008-9, lowest among six years.

But the Jamlapada Society Properatory ratio in highest of 2013-14. And lowest ratio in the

year 2008-9 .so concluded that Both Cooperative society management trying to Investors funds

use in Capital both cooperative society. so we can say that Management should create policy

and better use of shareholders capital.


Patel Dilipkumar


Page 43

Graph : 3 Properatory ratio

4. FIXED CAPITAL –ASSETS RATIO :

As its name suggests, the fixed-asset-to-equity-capital ratio is made up of two parts:

fixed assets and equity capital. A business's fixed assets are any type of physical assets that have

an expected lifetime of at least one year. Buildings, vehicles, furniture and heavy equipment are

all examples of fixed assets. Equity capital is the money that investors have put into a company.

As a reward for these funds, investors receive part ownership of a business. These investors then

hope that the business thrives and that the value of their shares in a company increases.

0.0 2000.0 4000.0 6000.0 8000.0 10000.0 12000.0

2008-09

2009-10

2010-11

2011-12

2012-13

2013-14

RATIO JAMLAPADA

RATIO DHAMNI


Patel Dilipkumar


Page 44

Table : 4 Fixed Capital – Assets Ratio of Dhamni And Jamlapada Cooperative Society


Interpretation

The table 4 reveals that the Fixed Capital Assets ratio of Dhamni

Cooperative Societies was Highest from 2.34 in the year 2008-9. It was at 1.69 ratio in 2013-14

lowest among six years. But the Fixed Capital -Assets ratio in case of Jamlapada Cooperative

Societies has highest ratio 19.85 in 2008-09. It was at its lowest in 2010-11 (3.53 ), the above it

can be concluded that Jamlapada Cooperative society position of Better to Dhamni

Cooperative society. Because there ratio. Compare to Dhamni cooperatives more variation to

Jamlapada cooperative society.


YEAR FIXED

CAPITAL

FIXED RATIO IN FIXED

CAPITAL

FIXED RATIO IN

ASSETS PERCENTAGE ASSETS PERCENTAGE

2008-09 1073321 459319 2.34 250092 12600 19.85

2009-10 1498177 669828 2.24 262559 34747 7.56

2010-11 2237290 1159122 1.93 928252 64637 14.36

2011-12 3095043 1931212 1.60 1339638 379656 3.53

2012-13 2745043 1778735 1.54 1667833 429106 3.89

2013-14 2745043 1622262 1.69 1761290 472540 3.73


Patel Dilipkumar


Page 45

Graph : 4 Fixed Capital – Assets Ratio

Hypothesis Test of Capital Structure Ratio :

‘ T ’ Test Analysis :

Null Hypothesis

Ho : There is no significance difference in the Capital Structure ratios of

Dhamni and Jamlapada Cooperative society

Alternative Hypothesis

H1 : There is significance difference in The Capital Structure ratios of Dhamni

and Jamlapada Cooperative society.

0.00

5.00

10.00

15.00

20.00

25.00

2.34 2.24 1.93 1.60 1.54 1.69

19.85

7.56

14.36

3.53 3.89 3.73

JAMLAPADA RATIO INPERCENTAGE



Patel Dilipkumar


Page 46

Table : 5 Hypothesis Test on ‘ T ’ Test Used On Capital Structure Ratio

Interpretation

The calculated P value on Debt Equity Ratio of Dhamni and Jamlapada horticulture

Cooperative society was 0.69 which is More than 0.05 level Hence null hypothesis

accepted and alternative hypothesis is rejected. It can be Canculated that No significance

difference between Dhamni and Jamlapada Cooperative society.

The Gearing Ratio of Dhamni and Jamlapada Cooperative society P Value was 0.45 it is

more than 0.05 level, so null hypothesis accepted.

Properatory ratio of selected cooperative society p value was 0.33 which is More than 0.05

level null hypothesis accepted .it can be concluded that Insignificance of dhamni and

Jamlapada Cooperative society

Fixed Assets Capital ratio p value 0.08 and this value was more than 0.05 level so null

hypothesis accepted. Concluded that there is Insignificance of selected cooperative society.

No. Ratio Mean S.D. Result

Particulars Dhamni Jamlapada Dhamni Jamlapada ‘ P ’

VALUE

Hypothesis

Test

01 Debt Equity

Ratio

0.25 0.34 0.27 0.45 0.69 H0

Accepted

02 Gearing Ratio 2.32 2.85 2.25 1.42 0.45 H0

Accepted

03 Properatory

Ratio

690.21 2932.87 257.135 4299.70 0.33 H0

Accepted

04 Fixed Capital-

Assets Ratio

1.80 6.61 0.33 6.81 0.08 H0

Accepted


Patel Dilipkumar


Page 47

(B) LIQUIDITY RATIOS :

Liquidity ratios are the ratios that measure the ability of a company to meet its short term

debt obligations. These ratios measure the ability of a company to pay off its short-term

liabilities when they fall due.

The liquidity ratios are a result of dividing cash and other liquid assets by the short term

borrowings and current liabilities. They show the number of times the short term debt

obligations are covered by the cash and liquid assets. If the value is greater than 1, it means

the short term obligations are fully covered.

1. CURRENT RATIO :

The current ratio is balance-sheet financial performance measure of company liquidity.

The current ratio indicates a company's ability to meet short-term debt obligations. The

current ratio measures whether or not a firm has enough resources to pay its debts over the

next 12 months. Potential creditors use this ratio in determining whether or not to make

short-term loans. The current ratio can also give a sense of the efficiency of a company's

operating cycle or its ability to turn its product into cash.


Patel Dilipkumar


Page 48

Table : 6 Current Ratio of Dhamni And Jamlapada Cooperative Society


YEAR

CURRENT CURRENT RATIO IN CURRENT CURRENT RATIO IN

ASSETS LIABILITY PERCENTAGE ASSETS LIABILITY PERCENTAGE

2008-09 1847515 305448 6.05 468482 292355 1.60

2009-10 1069227 240879 4.44 597284 263459 2.27

2010-11 1476602 387434 3.81 1040690 177074 5.88

2011-12 1122661 390330 2.88 969272 107389 9.03

2012-13 811511 373334 2.17 1255518 106791 11.76

2013-14 796856 379434 2.10 1195676 15788 75.73


Interpretation

The table 5 reveals that the Current ratio of Dhamni Cooperative Societies was varied

from 2.10 to 6.05 . It was at 2.10 ratio in 2013-14, lowest among six years.13. But the Current

ratio in case of Jamlapada Cooperative Societies has increased over the six years. It was at its

lowest in2008-09 (1.60 ), after that it has shown almost increment in Current ratios. from the

above it can be concluded that Financial position of Jamlapada Cooperative society is better

than Dhamni Cooperative Society. because Dhamni Co.society not maintain ratio every year.

So we can say Jamlapada cooperative society financial efficiency has good. Dhamni

Cooperative society management should planning to better improvement of current ratio.


Patel Dilipkumar


Page 49

Graph : 5 Current Ratio

2. QUICK RATIO :

The quick ratio is a measure of a company's ability to meet its short-term obligations using its

most liquid assets (near cash or quick assets). Quick assets include those current assets that

presumably can be quickly converted to cash at close to their book values. Quick ratio is viewed

as a sign of a company's financial strength or weakness; it gives information about a company’s

short term liquidity. The ratio tells creditors how much of the company's short term debt can be

met by selling all the company's liquid assets at very short notice.

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14


DHAMNI RATIO INPERCENTAGE


Patel Dilipkumar


Page 50

Table : 7 Following table : Quick Ratio of Dhamni And Jamlapada Cooperative Society


YEAR

QUICK QUICK RATIO IN QUICK QUICK RATIO IN

ASSETS LIABILIT

Y

PERCENTAG

E

ASSET

S

LIABILIT

Y

PERCENTAG

E

2008-

09 389654 305448 1.28 455170 292355 1.56

2009-

10 771244 240879 3.20 524327 263459 1.99

2010-

11 1454155 387434 3.75 900965 177074 5.09

2011-

12 1066251 390330 2.73 947940 107389 8.83

2012-

13 760785 373334 2.04 979486 106791 9.17

2013-

14 796856 379434 2.10 613447 15788 38.86


Interpretation

The table 6 reveals that the Quick ratio of Dhamni Cooperative Societies was varied

from 1.28 to 3.75 . It was at 1.28 ratio in 2008-09, lowest among six years again it increased

to 3.20 in 2009-10 and discrease in 2.10 year 2013-14, But the Quick ratio in case of

Jamlapada Cooperative Societies has increased over the six years. It was at its lowest in 2008-

09 ( 1.56 ), after that it has shown almost increment in every year Quick ratios. from the above it

can be concluded that Financial position of Jamlapada Cooperative society financial strenght is

better than Dhamni Cooperative Society. because Dhamni Co.society ratio has low compatre to

Jamlapada cooperative societies every year. So we can say Jamlapada cooperative society

financial Strenght has good.and management decision policy good working

.


Patel Dilipkumar


Page 51

Graph : 6 Quick Ratio

Hypothesis Test of Liquidity Ratio :


Null Hypothesis

Ho : There is no significance difference in the Liquidity ratios of Dhamni and

Jamlapada Cooperative societies.


H1 : There is significance difference in the Liquidity ratios of Dhamni and

Jamlapada Cooperative societies.

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14




Patel Dilipkumar


Page 52

Table : 8 Hypothesis Test on ‘ T ’ Test Used On Liquidity Ratio

Interpretation

Above table The calculated P value on Current Ratio of Dhamni and Jamlapada horticulture

Cooperative society was 0.26 which is More than 0.05 level Hence null hypothesis accepted and

alternative hypothesis is rejected.indicate the Current Assets more than compare to current debt.so. It

can be Canculated that No significance difference between Dhamni and Jamlapada Cooperative

society.

The Liquidity Ratio of Dhamni and Jamlapada Cooperative society P Value was 0.20 it is more than

0.05 level, so null hypothesis accepted and alternative hypothesis rejected. so indicate the selected

Cooperative Societies have quick Assets stability has good and Satisfied.


Particulars Dhamni Jamlapada Dhamni Jamlapada ‘ P ’

Value

Hypothesis

Test

01 Current Ratio 3.08 20.93 1.51 28.68 0.26 H0

Accepted

02 Quick Ratio 2.76 12.78 0.89 14.06 0.20 H0

Accepted


Patel Dilipkumar


Page 53

(C) PROFIABILITY RATIOS :

Profitability ratios measure a company’s ability to generate earnings relative to sales,

assets and equity. These ratios assess the ability of a company to generate earnings, profits and

cash flows relative to relative to some metric, often the amount of money invested. They

highlight how effectively the profitability of a company is being managed.

Common examples of profitability ratios include return on sales, return on investment, return on

equity, return on capital employed (ROCE), cash return on capital invested (CROCI), gross

profit margin and net profit margin. All of these ratios indicate how well a company is

performing at generating profits or revenues relative to a certain metric.

1. GROSS PROFIT RATIO :

Gross profit margin (gross margin) is the ratio of gross profit (gross sales less cost

of sales) to sales revenue. It is the percentage by which gross profits exceed production

costs. Gross margins reveal how much a company earns taking into consideration the

costs that it incurs for producing its products or services. Gross margin is a good

indication of how profitable a company is at the most fundamental level, how

efficiently a company uses its resources, materials, and labour. It is usually expressed

as a percentage, and indicates the profitability of a business before overhead costs; it is

a measure of how well a company controls its costs. Gross margin measures a

company's manufacturing and distribution efficiency during the production process.

The higher the percentage, the more the company retains on each Rs of sales to service

its other costs and obligations, the better the company is thought to control costs.

Investors use the gross profit margin to compare companies in the same industry and

also in different industries to determine what are the most profitable. A company that

boasts a higher gross margin than its competitors and industry is more efficient.

http://www.readyratios.com/reference/profitability/cash_return_on_capital_invested_croci.html


Patel Dilipkumar


Page 54

Table : 9 Gross Profit Ratio of Dhamni And Jamlapada Cooperative Society


YEAR

GROSS

SALES

RATIO IN GROSS

SALES

RATIO IN

PROFIT PERCENTAGE PROFIT PERCENTAGE

2008-09 437387 1951365 22.41 209006 1039558 20.11

2009-10 465184 3026474 15.37 396443 2685151 14.76

2010-11 906062 3590618 25.23 741988 2041684 36.34

2011-12 5270 2317733 0.23 640988 4141532 15.48

2012-13 66815 854164 7.82 429199 3633188 11.81

2013-14 9690 2631675 0.37 622181 2640915 23.56


Interpretation

The table 7 reveals that the Gross Profit ratio of Dhamni horticulture Cooperative

Societies was 22.41 ratio in 2008-09, highest among six years.it discreased to 15.37 in 2009-

10 and Increase in 25.23 year 2010-11, and all next year ratio was low and last year was lowest

ratio, But the Gross Profit ratio in case of Jamlapada horticulture Cooperative Societies highest

in 36.34 in 2010-11. And lowest ratio was 11.81 in 2012-13. It can be concluded that

Jamlapada Cooperative society has good gross profit ratio every year maintain. Dhamni

cooperative society only two year good ratio and all year low ratio. And last study year 2013-14

was very low is not satisfied. It can show is Jamlapada Coperative society Cost of good sale

and Goods Sale policy has good and Satisfied. And Dhamni Cooperatives Management should

take several step and improve the sale policy.


Patel Dilipkumar


Page 55

Graph : 7 Gross Profit Ratio

2. NET PROFIT RATIO :

The net profit percentage is the ratio of after-tax profits to net sales. It reveals the remaining

profit after all costs of production, administration, and financing have been deducted from sales,

and income taxes recognized. As such, it is one of the best measures of the overall results of a

firm, especially when combined with an evaluation of how well it is using its working capital.

The measure is commonly reported on a trend line, to judge performance over time. It is also

used to compare the results of a business with its competitors.

Net profit is not an indicator of cash flows, since net profit incorporates a number of non-cash

expenses, such as accrued expenses, amortization, and depreciation.

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14



http://www.accountingtools.com/accrual-definition


Patel Dilipkumar


Page 56

Table : 10 Net Profit Ratio of Dhamni And Jamlapada Cooperative Society


YEAR

NET

SALES

RATIO IN NET

SALES

RATIO IN

PROFIT PERCENTAGE PROFIT PERCENTAGE

2008-09 103930 1951365 5.33 184200 1039558 17.72

2009-10 94943 3026474 3.14 209771 2685151 7.81

2010-11 643628 3590618 17.93 407999 2041684 19.98

2011-12 -431499 2317733 -18.62 142791 4141532 3.45

2012-13 -96831 854164 -11.34 195078 3633188 5.37

2013-14 -476727 2631675 -18.11 -28304 2640915 -1.07

Source: Compiled Calculated Dat

Interpretation

The table 8 reveals that the Net Profit ratio of Dhamni horticulture Cooperative

Societies was varied from 17.93 to -18.62. It was highest ratio at 17.93 ratio in 2010-11,

lowest among six years highest ratio was -18.62 year 2011-12. But the Net Profit ratio in case

of Jamlapada Cooperative Societies highest in 19.98 in 2010-11. And lowest ratio was 2013-

14 in -1.07 , It can be concluded that Dhamni Cooperative society has three study period has net

loss. And Jamlapda cooperative society has only one time has net loss. So I can say Jamlapada

cooperative society Financial efficiency and Financial Expenses control policy has very good to

compare with dhamni Cooperative society.So Dhamni Coooperative Society should Financial

Expense contoliing make better policy.


Patel Dilipkumar


Page 57

Graph : 8 Net Profit Ratio

3. OPERATING RATIO :

The operating ratio is the ratio of production and administrative expenses to net sales. The

measure excludes financing costs, non-operating expenses, and taxes. Essentially, it is the cost

per sales dollar of operating a business. A lower operating ratio is a good indicator of

operational efficiency, especially when the ratio is low in comparison to the same ratio for

competitors and benchmark firms.

The operating ratio is only useful for seeing if the core business is able to generate a profit.

Since several potentially significant expenses are not included, it is not a good indicator of the

overall performance of a business, and so can be misleading when used without any other

performance metrics. For example, a company may be highly leveraged and must therefore

make massive interest payments that are not considered part of the operating ratio.

-30.00

-20.00

-10.00

0.00

10.00

20.00

30.00

40.00

50.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14




Patel Dilipkumar


Page 58

To calculate the operating ratio, add together all production costs (i.e., the cost of goods sold)

and administrative expenses (which includes general, administrative, and selling expenses) and

divide by net sales (which is gross sales, less sales discounts, returns, and allowances).

Table : 11 Operating Ratio of Dhamni And Jamlapada Cooperative Society

Source: Compiled Calculated Data

Interpretation

The table 9 reveals that the Operating ratio of Dhamni Cooperative Society was varied

from Highest 138.68 in 2012-13 It was at 85.21 ratio in 2010-11 lowest among six years, But

the Operating ratio in same case of Jamlapada Cooperative Societies highest in 112.19 in

2013-14. It can be concluded that the dhamni and jamlapada Cooperative society has only three

year less to 100 % in study period and Dhamni cooperative society last three years very high

compare to Jamlapada very high ratio indicate operating cost was high in this year .It Can be

Concluded that low percentage show better expence and good management policy. So we can

say that Jamlapada Cooperative management use good Expense operate policy compare with

dhamni cooperative society.


YEAR

SALE

GOODS SALE

RATIO IN SALE

GOODS SALE RATIO IN

OF COST PERCENTA

GE OF COST

PERCENT

AGE

2008-09 1542067 1951365 96.40 830552 1039552 81.70

2009-10 2561290 3026474 97.04 2288708 2685151 92.39

2010-11 2684556 3590618 85.21 1299696 2041684 79.15

2011-12 2312463 2317733 128.49 3500544 4141532 96.68

2012-13 787349 854164 138.68 3203989 3633188 101.79

2013-14 2621985 2631675.00 118.56 2198984 2640915 112.19


Patel Dilipkumar


Page 59

Graph : 9 Operating Ratio

4. Return on total Assets

Return on Assets (ROA) is an indicator of how profitable company's assets are in

generating profit. Return on Assets shows how many Amount of earnings result from

each Amount of assets the company controls. Return on Assets ratio gives an idea of

how efficient management is at using its assets to generate profit.

0.00

20.00

40.00

60.00

80.00

100.00

120.00

140.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14




Patel Dilipkumar


Page 60

Table : 12 Return on total Assets of Dhamni And Jamlapada Cooperative Society


YEAR

AFTER TAX TOTAL RATIO IN AFTER TAX TOTAL RATIO IN

NET PROFIT ASSETS PERCENTAGE NET PROFIT ASSETS PERCENTAGE

2008-09 103930 2306834 4.51 184536 542448 34.02

2009-10 94943 1739052 5.46 211759 633032 33.45

2010-11 633999 2624723 24.15 411136 1105326 37.20

2011-12 -431499 3053874 -14.13 151098 1558031 9.70

2012-13 -96831 2590047 -3.74 211197 1774624 11.90

2013-14 -474444 2119120 -22.39 -61186 1668222 -3.67


Interpretation

The table 10 reveals that the Return on total assets ratio of Dhamni

Cooperative Societies was varied from Highest 24.15 in 2010-11 It was at –22.39

ratio in 2013-14. lowest among six years, But the Return on total assets ratio in case

of Jamlapada Cooperative Societies highest in 37.20 in 2010-11.and lowest rario was

-3.67 in 2013-14. It can be concluded that dhamni Cooperative society has three year

very low ratio in study period and Jamlapada Cooperative society has good maintain

ratio in all study period. But Only one year net loss and better management working to

purchase assets.So we can say return on total assts ratio has Jamlapada cooperative

good working. To compare with Dhamni Cooperative societies.


Patel Dilipkumar


Page 61

Graph : 10 Return on total Assets

5. Return On Capital Employed :

Return on capital employed or ROCE is a profitability ratio that measures how

efficiently a company can generate profits from its capital employed by comparing net operating

profit to capital employed. In other words, return on capital employed shows investors how

many Rupees in profits each rupees of capital employed generates.

DHAMNI RATIO IN PERCENTAGEJAMLAPADA RATIO IN PERCENTAGE

-30.00

-20.00

-10.00

0.00

10.00

20.00

30.00

40.00


Patel Dilipkumar


Page 62

Table : 13 Return on Capital employed of Dhamni And Jamalapada Cooperative

Society.


YEAR

BEFORE

TAX

INVESTE

D RATIO IN

BEFORE

TAX

INVESTE

D RATIO IN

NET

PROFIT CAPITAL

PERCENTAG

E NET PROFIT CAPITAL

PERCENTAG

E

2008-09 199474 1073321 18.58 184200 295000 62.44

2009-10 100661 1498177 6.72 210272 459572 45.75

2010-11 643628 2237290 28.77 468480 928252 50.47

2011-12 -431499 3095043 -13.94 263522 1339638 19.67

2012-13 -96831 2745043 -3.53 195078 1667833 11.70

2013-14 -476727 2745043 -17.37 -108856 1761290 -6.18


Interpretation

The table 11 reveals that the Return on Capital Employed of Dhamni

Cooperative Societies was varied from Highest 28.77 in 2010-11 It was at -17.37 ratio

in 2013-14. lowest among six years, But the Return on Capital Employed ratio in

case of Jamlapada Cooperative Societies highest in 50.47 in 2010-11.and lowest rario

was -6.18 in 2013-14. It can be concluded that Dhamni Cooperative society has three

year very low ratio in study period and Jamlapada Cooperative society has good

maintain ratio in all study period but last year ratio has no Satisfied.So we can say

return on Capital employed has Jamlapada cooperative Society good working. And

Dhamni Cooperatives Society should some step take and improve the ratio.


Patel Dilipkumar


Page 63

Graph : 11 Return on Capital Employed

-20.00

-10.00

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14




Patel Dilipkumar


Page 64

Hypothesis Test of Profitability Ratio :


Null Hypothesis

Ho : There is no significance difference in the Profitability ratios of Dhamni



H1 : There is significance difference in the Profitability ratios of Dhamni and

Jamlapada Cooperative society.

Table : 14 Hypothesis Test on ‘ T ’ Test Used On Profitability Ratio

Interpretation

The calculated P value on Gross profit Ratio of Dhamni and Jamlapada horticulture Cooperative

society was 0.14 which is More than 0.05 level Hence null hypothesis accepted and alternative


Particulars Dhamni Jamlapada Dhamni Jamlapada

‘ P ’

Value

Hypothesis

Test

01 Gross profit Ratio 9.80 20.39 10.82 8.87 0.14

H0

Accepted

02 Net Profit Ratio -5.40 7.10 14.72 8.28 0.16 H0

Accepted

03 Operating Ratio 113.596 96.44 20.98 12.43 0.17

H0

Accepted

04 Return on Total

Assets -2.12 17.71 16.38 16.75 0.11

H0

Accepted

05 Return On Capital

Employed 0.13 24.28 18.24 26.33 0.11

H0

Accepted

06 Return On Share

Holders Equity 0.05 21.78 17.04 28.93 0.13

H0

Accepted


Patel Dilipkumar


Page 65

hypothesis is rejected. It can be Canculated that No significance difference between Dhamni and


The Net Profit Ratio of Dhamni and Jamlapada Cooperative society P Value was 0.16 it is more than

0.05 level, so null hypothesis accepted.

Operating ratio of selected cooperative society p value was 0.17 which is More than 0.05 level null

hypothesis accepted .it can be concluded that Insignificance of dhamni and Jamlapada Cooperative

society.

Return on Total assets Ratio of Dhamni and Jamlapada Cooperative society p value was 0.11 this

value more than 0.05 level so, null hypothesis accepted and alternative hypothesis rejected.concluded

that return on total assets ratio there is no significance difference between selected firm.

Return on Capital Employed ratio p value 0.11 and this value was more than 0.05 level so null

hypothesis accepted. Concluded that there is Insignificance of selected cooperative society.

Return on Shareholders Equity ratio of Dhamni and Jamlapada Cooperative society p value is 0.13

which is 0.05 level , So,Null hypothesis accepted and alternative hypothesis rejected.concluded that

selected firm no significantly differ.


Patel Dilipkumar


Page 66

(D) ACTIVITY RATIOS

Efficiency ratios show how efficiently the business is using its resources.

Shareholders in particular will want to know how well the firm is using their money!

It is advisable for the business to get as much turnover from its assets as possible and

at the same time it is not a good idea for it to have too many assets in the form of

stock or debtors.

Financial efficiency can be examined by using the following ratios:

Stock turnover

Debtor days

Fixed assets turnover ratio

Total Assets turnover ratio

Working Capital turnover


Patel Dilipkumar


Page 67

(1 ) STOCK TURNOVER RATIO :

A low inventory turnover ratio is a signal of inefficiency, since inventory usually has a

rate of return of zero. It also implies either poor sales or excess inventory. A low turnover

rate can indicate poor liquidity, possible overstocking, and obsolescence, but it may also

reflect a planned inventory buildup in the case of material shortages or in anticipation of

rapidly rising prices.

Table : 15 Stock Turnover ratio of Dhamni And Jamlapada Cooperative Societies


YEAR

SALE OF AVERAGE

STOCK

RATIO

IN SALE OF

AVERAGE

STOCK

RATIO

IN

COST

GOODS TIME

COST

GOODS TIME

2008-09 1542067 760356 2.03 830552 37339 22.24

2009-10 2561290 877922 2.92 2288708 69678 32.85

2010-11 2684556 160215 16.76 1299696 106341 12.22

2011-12 2317463 38929 59.53 3500544 185080 18.91

2012-13 787349 53568 14.70 3203989 253233 12.65

2013-14 2621985 25363 103.38 2198984 310005 7.09


Interpretation

Above Table 12 , Stock Turnover ratio of Dhamni Cooperative society in Ratio was

2.03 in the year 2008-09 in subsequent years it is 2.92 in 2009-10, 16.76 in 2010-11, 59.53

in 2011-12, and 14.70 in 2012-13. And 103.38 in 2013-14.The analysis clearly shows that

ratio was 32.85 2009-10 year Highest ratio And lowest ratio in 2.03 in year 2008-09. Same

case of Stock Turnover ratio of Jamlapada Cooperative society Ratio The analysis clearly

shows that ratio is 32.85 in year 2009-10 Highest ratio And lowest ratio in 2013-14 in 7.09.

It can be Concluded that Jamalapada cooperative society every year ratio compare to Mandava

cooperatives to high ratio. And maintmain satisfied ratio high ratio showing good sale efficieny


Patel Dilipkumar


Page 68

but very high is danger. we can say that Jamlapada cooperative society has good working policy

and satisfied turnover ratio.

Graph : 12 Stock Turnover ratio

( 2) Fixed turnover Ratio :

0.00 20.00 40.00 60.00 80.00 100.00 120.00

2008-09

2009-10

2010-11

2011-12

2012-13

2013-14

Jamlapada RATIO IN TIME

Dhamni RATIO IN TIME


Patel Dilipkumar


Page 69

The fixed asset turnover ratio is the ratio of net sales to net fixed assets (also known as

property, plant, and equipment). A high ratio indicates that a business is:

Doing an effective job of generating sales with a relatively small amount of fixed assets

Outsourcing work to avoid investing in fixed assets

Selling off excess fixed asset capacity

Table : 16 Fixed assets Turnover ratio of Dhamni And Jamlapada Cooperative

Society


YEAR SALE

NET

FIXED RATIO IN

SALE

NET

FIXED RATIO IN

ASSETS PERCENTAG

E ASSETS

PERCENTA

GE

2008-09 1951365 459319 4.25 1039558 12600 82.50

2009-10 3026474 669828 4.52 2685155 34747 77.28

2010-11 3590618 1159122 3.10 2041684 64637 31.59

2011-12 2317733 1931212 1.20 4141532 379656 10.91

2012-13 854164 1778735 0.48 3633188 429106 8.47

2013-14 2745043 1622262 1.69 2640915 472540 5.59


Interpretation

The table 13 reveals that the Fixed assets turnover ratio of Dhamni Cooperative Societies was

varied from Highest 4.52 in 2009-10. It was at 0.48 ratio in 2012-13. lowest among six years,

But the Fixed assets turnover ratio in case of Jamlapada Cooperative Societies highest in 82.50

http://www.accountingtools.com/definition-fixed-asset


Patel Dilipkumar


Page 70

in 2008-9.and lowest rario was 5.59 in 2013-14. It can be concluded that Jamlapada

Cooperative society was ratio satisfied and Dhamni society has low ratio compare with

jamlapada cooperative ratio.so I can say Jamlapada Cooperative society was satisfied financial

analysis.

Graph : 13 Fixed assets turnover ratio

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

100.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14




Patel Dilipkumar


Page 71

( 3) Total Assets Turnover Ratio :

The amount of sales or revenues generated per dollar of assets. The Asset Turnover ratio

is an indicator of the efficiency with which a company is deploying its assets.

Table : 17 Total assets Turnoveer ratio of Dhamni And Jamlapada Cooperative

Society


YEAR SALE

TOTAL RATIO IN

SALE

TOTAL RATIO IN

ASSETS PERCENTAGE ASSETS PERCENTAGE

2008-09 1951365 2306834 0.85 1039558 542448 1.92

2009-10 3026474 1739052 1.74 2685155 633031 4.24

2010-11 3590618 2624723 1.37 2041684 1105327 1.85

2011-12 2317733 3053874 0.76 4141532 1558031 2.66

2012-13 854164 2590047 0.33 3633188 1774625 2.05

2013-14 2745043 2119120 1.30 2640915 1668222 1.58


Interpretation

The table 14 reveals that the Total assets turnover ratio of Dhamni Cooperative

Societies was varied from Highest 1.74 in 2009-10. It was at 0.33 ratio in 2012-13. lowest

among six years, But the Fixed Total turnover ratio in case of Jamlapada Cooperative

Societies highest in 2.66 in 2011-12. and lowest rario was 1.58 in 2013-14. It can be

concluded that Jamlapada Cooperative society’s ratio better to compare with dhamni

Cooperative society.


Patel Dilipkumar


Page 72

Graph : 14 Total assets turnover ratio

(4) Debtors turnover ratio

The receivable turnover ratio (debtors turnover ratio, accounts receivable turnover ratio)

indicates the velocity of a company's debt collection, the number of times average receivables

are turned over during a year. This ratio determines how quickly a company collects outstanding

cash balances from its customers during an accounting period. It is an important indicator of a

company's financial and operational performance and can be used to determine if a company is

having difficulties collecting sales made on credit. Receivable turnover ratio indicates how

many times, on average, account receivables are collected during a year A popular variant of the

receivables turnover ratio is to convert it into an Average collection period in terms of days. The

average collection period (also called Days Sales Outstanding is the number of days, on average,

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14




Patel Dilipkumar


Page 73

that it takes a company to collect its accounts receivables, i.e. the average number of days

required to convert receivables into cash.

Table : 18 Debtors Turnoveer ratio of Dhamni And Jamlapada Cooperative Society


Interpretation :

The table 15 Show that the Debtors Turnover ratio of Dhamni Cooperative Societies

was varied from Highest 86 days in 2012-13. It was at 14 days in 2010-11. lowest among six

years, But the Debtors ratio in same case of Jamlapada Cooperative Societies highest in 66

days in 2008-09 and lowest rario was 13 day in 2011-12. It can be concluded that Jamlapada

Cooperative society’s collection policy has good. And Dhamni Cooperatives has long

collection period. I can say that Dhamni Cooperative Society Management take several step and

improve debtors collection policy.


YEAR DEBTORS CREDIT RATIO IN

DEBTORS CREDIT RATIO IN

SALES DAY SALES DAY

2008-09 162327 1951365 30 186003 1039558 64

2009-10 570897 3026474 68 154079 2685155 21

2010-11 136471 3590618 14 77884 2041684 14

2011-12 261726 2317733 41 144218 4141532 13

2012-13 204751 854164 86 144591 3633188 14

2013-14 134813 2745043 18 178375 2640915 24


Patel Dilipkumar


Page 74

Graph : 15 Debtors Turnover ratio

(5) Current Assets turnover ratio :

Current assets turnover is an efficiency measurement accountants apply to a

company’s financial statements. Both the income statements and balance sheets have the

requisite information for computing this ratio. The result from this formula is a metric

that indicates how well a company generates sales revenue from the current assets it

owns. A higher number is generally preferable as the company uses its assets in the most

efficient manner possible. Accountants can compute the current assets turnover ratio on a

monthly basis.

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

100.00

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

DHAMNI RATIO IN DAY

JAMLAPADA RATIO IN DAY

http://www.wisegeek.com/what-is-a-turnover-ratio.htm


Patel Dilipkumar


Page 75

Table : 19 Current assets turnoveer ratio of Dhamni And Jamlapada Cooperative

Society


YEAR TOTAL

SALE

CURREN

T RATIO IN

TOTAL

SALE

CURREN

T RATIO IN

ASSETS PERCENTAG

E ASSETS

PERCENTAG

E

2008-09 1951365 1847515 1.06 1039558 468482 2.22

2009-10 3026474 1069227 2.83 2685155 597284 4.50

2010-11 3590618 1476602 2.43 2041684 1040690 1.96

2011-12 2317733 1122661 2.06 4141532 969272 4.27

2012-13 854164 811511 1.05 3633188 1255518 2.89

2013-14 2745043 796856 3.44 2640915 1195676 2.21


Interpretation :

The table 16 Show that the Current Assets Turnover ratio of Dhamni Cooperative

Societies was varied from Highest 2.83 in 2009-10. It was at 1.05 in 2012-13. lowest among

six years, But the Current Assets turnover ratio in case of Jamlapada Cooperative Societies

highest in 4.50 in 2009-10 and lowest rario was 1.96 in 2010-11. It can be concluded that

Dhmni Cooperative society’s and Jamlapada both society was working Satisfied because every

year maintain good ratio Inventry,and other Current assets turnover Management has satisfied.


Patel Dilipkumar


Page 76

Graph : 16 Current Assets Turnover ratio

(6.) Working Capital Turnover Ratio :

The working capital turnover ratio measures how well a company is utilizing its working

capital to support a given level of sales. Working capital is current assets minus current

liabilities. A high turnover ratio indicates that management is being extremely efficient in using

a firm's short-term assets and liabilities to support sales. Conversely, a low ratio indicates that a

business is investing in too many accounts receivable and inventory assets to support its sales,

which could eventually lead to an excessive amount of bad debts and obsolete inventory.

0.00 1.00 2.00 3.00 4.00 5.00

2008-09

2009-10

2010-11

2011-12

2012-13

2013-14



http://www.accountingtools.com/dictionary-working-capital

http://www.accountingtools.com/dictionary-working-capital


Patel Dilipkumar


Page 77

Table : 20 Working Ccapital Turnoveer ratio of Dhamni And Jamlapada Cooperative

Society


YEAR TOTAL

SALE

WORKIN

G RATIO IN

TOTAL

SALE

WORKIN

G RATIO IN

CAPITAL PERCENTA

GE CAPITAL

PERCENTA

GE

2008-09 1951365 1542067 1.27 1039558 176127 5.90

2009-10 3026474 828348 3.65 2685155 333825 8.04

2010-11 3590618 1089168 3.30 2041684 863616 2.36

2011-12 2317733 732331 3.16 4141532 861883 4.81

2012-13 854164 438177 1.95 3633188 1148727 3.16

2013-14 2745043 417422 6.58 2640915 1179888 2.24


Interpretation :

The table 17 Show that the Working Capital Turnover ratio of Dhamni Cooperative

Societies was varied from Highest 6.58 in 2013-14. It was at 1.27 in 2008-09. lowest among

six years, But the Working Capital ratio in case of Jamlapada Cooperative Societies highest

in 8.04 in 2009-10 and lowest rario was 2.24 in 2013-14. It can be concluded that Dhamni

Cooperative society’s Working Capital has Low ratio with compare to Jamlapada Coperatives.

So We can say that Dhamni Cooperatives high ratio show that management is being extremely

efficient in using a firm's short-term assets and liabilities to support sales.


Patel Dilipkumar


Page 78

Graph : 17 Working Capital Turnover Ratio

Hypothesis Test of Activity Ratio :


T test is based on T Distribution and is considering an appropriate test for judging

the significance of the coefficient of simple and partial correlations

The relevant test statstics is Calculated from the sample data and then Compared

with its problems value based on T Distribution at specified level of significance for

concerning degree of freedom for accepting or rejecting the Null hypothesis.

Null Hypothesis

Ho : There is no significance difference in the Activity ratios of Dhamni and



H1 : There is significance difference in the Activity ratios of Dhamni and


0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

1.27

3.653.30

3.16

1.95

6.58

5.90

8.04

2.36

4.81

3.16

2.24




Patel Dilipkumar


Page 79

Table : 21 Hypothesis Test on ‘ T ’ Test Used On Activity Ratio

Interpretation

Above ‘ t ’ test at 5 % significant level showed significance in Activity Ratios

The calculated P value on Stock turnover Ratio of Dhamni and Jamlapada horticulture


accepted and alternative hypothesis is rejected. It can be Canculated that No significance

difference between Dhamni and Jamlapada Cooperative society.

The Fixed Assets Turnover Ratio of Dhamni and Jamlapada Cooperative society P Value

was 0.14 it is more than 0.05 level, so null hypothesis accepted. It can be concluded that there

is no significance difference between selected Cooperative Societies.

The total assets turnover ratio of selected cooperative society p value was 0.04 which is less

than 0.05 level so ,alternative hypothesis accepted and null hypothesis accepted,it can be

concluded that Significance difference between dhamni and Jamlapada Cooperative society.


Particulars Dhamni Jamlapada Dhamni Jamlapada

‘ P ’

Value

Hypothesis

Test

01 Stock Turnover 39.45 16.74 40.29 9.15 0.30 H0

Accepted

02 Fixed Assets

Turnover

2.19 26.76 1.66 35.20 0.14 H0

Accepted

03 Total Asset

Turnover

1.09 2.47 0.50 0.97 0.04 H1

Accepted

04 Debtors Ratio 45.24 17.11 28.88 19.84 0.12 H0

Accepted

05 Current Assets

Turnover

2.36 3.16 0.96 1.11 0.26 H0

Accepted

06 Working Capital

Turnover

3.72 4.12 1.83 2.28 0.77 H0

Accepted


Patel Dilipkumar


Page 80

Debtors Ratio of Dhamni and Jamlapada Cooperative society p value was 0.12 this value more than

0.05 level so, null hypothesis accepted and alternative hypothesis rejected.concluded that debtors ratio

there is no significance difference between selected firm.

Current assets turnover ratio p value 0.26 and this value was more than 0.05 level so null hypothesis

accepted. Concluded that there is no significance difference of selected cooperative society.

The working capital turnover ratio of Dhamni and Jamlapada Cooperative society p value is 0.77 which

is 0.05 level , So,Null hypothesis accepted and alternative hypothesis rejected.concluded that selected

firm no significantly differ.


Patel Dilipkumar


Page 81

Chapter : 5

Findings and Suggestion

Findings :

Following findings of the research studt by researcher.

Debt Equity ratio of Dhamni Cooperative Societies was Highest ratio from 0.82 in the

year 2008-09. It was at 0.13 ratio in 2011-12, lowest among six years. But the ratio in

case of Jamlapada Cooperative Societies has discreased over the five years. It was at

its lowest in 2013-14 ( 0.01), after that it has shown almost low increment every year

in Debt equity ratios. it can be findings that Debt equity position of dhamni

Cooperative society is better than Jamlapada Cooperative Society.because Jamlapada

Co.society not maintain ratio every year.

The calculated P value on Debt Equity Ratio of Dhamni and Jamlapada

horticulture Cooperative society was 0.69 which is More than 0.05 level

Hence null hypothesis accepted and alternative hypothesis is rejected. It can be

Canculated that No significance difference between Dhamni and Jamlapada

Cooperative society.

The Gearing ratio of Dhamni Cooperative Societies was Highest from 7.77 in

the year 2008-09. It was at 1.58 ratio in 2009-10, lowest among six years. But

the Gearing ratio in same case of Jamlapada Cooperative Societies has highest

ratio was 4.53 in 2013-14 & 2008-09. It was at its lowest in 2012-13 (1.49 ),

after that it has shown almost average every year in Gearing ratios. from the

can be findings that Jamlapada horticulture Cooperative society position of

Average because no Maintain every year ratio. And Dhamni is maintain

average..

The Gearing Ratio of Dhamni and Jamlapada Cooperative society P Value

was 0.45 it is more than 0.05 level, so null hypothesis accepted.


Patel Dilipkumar


Page 82

The Properatory Ratio of Dhamni Cooperative Societies was Highest from 792.9 in the

year 2011-12. It was at 90 ratio in 2008-9, lowest among six years. But the Jamlapada

Society Properatory ratio in highest of 2013-14. And lowest ratio in the year 2008-9 .it

can be Findings that Both Cooperative society management trying to Investors funds

use in Capital both cooperative society.

Properatory ratio of selected cooperative society p value was 0.33 which is

More than 0.05 level null hypothesis accepted .it can be concluded that

Insignificance of dhamni and Jamlapada Cooperative society

Fixed Capital Assets ratio of Dhamni Cooperative Societies was Highest from 2.34 in

the year 2008-9. It was at 1.69 ratio in 2013-14 lowest among six years. But the Fixed

Capital -Assets ratio in case of Jamlapada Cooperative Societies has highest ratio 19.85

in 2008-09. It was lowest in 2010-11 (3.53 ), it can be find that Jamlapada Cooperative

society position of Better to Dhamni Cooperative society. Because there ratio. Compare

to Dhamni cooperatives more variation to Jamlapada cooperative society.

Fixed Assets Capital ratio p value 0.08 and this value was more than 0.05 level

so null hypothesis accepted. Concluded that there is Insignificance of selected

cooperative society.

Current ratio of Dhamni Cooperative Societies was 2.10 ratio in 2013-14, lowest

among six years.13. But the Current ratio in case of Jamlapada Cooperative Societies

has increased over the five years. It was its lowest in2008-09 (1.60 ), after that it has

shown almost increment in Current ratios. it can be findings that Financial position of

Jamlapada Cooperative society is better than Dhamni Cooperative Society. because

Dhamni Co.society not maintain ratio every year.

The calculated P value on Current Ratio of Dhamni and Jamlapada horticulture


accepted and alternative hypothesis is rejected.indicate the Current Assets more than

compare to current debt.so. It can be Canculated that No significance difference

between Dhamni and Jamlapada Cooperative society.

The Quick ratio of Dhamni Cooperative Societies was varied from 1.28 to 3.75 . It

was at 1.28 ratio in 2008-09, lowest among five years again it increased to 3.20 in


Patel Dilipkumar


Page 83

2009-10 and discrease in 2.10 year 2013-14, But the Quick ratio in case of Jamlapada

Cooperative Societies has increased over the five years. It was at its lowest in 2008-09 (

1.56 ), after that it has shown almost increment in every year Quick ratios. from the

above it can be find that Financial position of Jamlapada Cooperative society financial

strenght is better than Dhamni Cooperative Society. because Dhamni Co.society ratio

has low compatre to Jamlapada cooperative societies every year. we can say Jamlapada

cooperative society financial Strenght has good.and management decision policy good

working

The Liquidity Ratio of Dhamni and Jamlapada Cooperative society P Value was 0.20

it is more than 0.05 level, so null hypothesis accepted and alternative hypothesis

rejected.so indicate the selected Cooperative Societies have quick Assets stability has

good and Satisfied.

The Gross Profit ratio of Dhamni horticulture Cooperative Societies was 22.41 ratio in

2008-09, highest among five years.it discreased to 15.37 in 2009-10 and Increase in

25.23 year 2010-11, and all next year ratio was low and last year was lowest ratio, But

the Gross Profit ratio in case of Jamlapada horticulture Cooperative Societies highest in

36.34 in 2010-11. And lowest ratio was 11.81 in 2012-13. It can be founded that

Jamlapada Cooperative society has good gross profit ratio every year maintain. Dhamni

cooperative society only two year good ratio and all year low ratio. And last study year

2013-14 was very low is not satisfied. It can show is Jamlapada Coperative society Cost

of good sale and Goods Sale policy has good and Satisfied.

The calculated P value on Gross profit Ratio of Dhamni and Jamlapada horticulture


accepted and alternative hypothesis is rejected. It can be Canculated that No

significance difference between Dhamni and Jamlapada Cooperative society.

The Net Profit ratio of Dhamni horticulture Cooperative Societies was varied from

17.93 to -18.62. It was highest ratio at 17.93 ratio in 2010-11, lowest among five years

highest ratio was -18.62 year 2011-12. But the Net Profit ratio in case of Jamlapada

Cooperative Societies highest in 19.98 in 2010-11. And lowest ratio was 2013-14 in -


Patel Dilipkumar


Page 84

1.07 , It can be concluded that Dhamni Cooperative society has three study period has

net loss. And Jamlapda cooperative society has only one time has net loss. So I can say

Jamlapada cooperative society Financial efficiency and Financial Expenses control

policy has very good to compare with dhamni Cooperative society.So Dhamni

Coooperative Society should Financial Expense contoliing make better policy.

The Net Profit Ratio of Dhamni and Jamlapada Cooperative society P Value was 0.16

it is more than 0.05 level, so null hypothesis accepted.

The Operating ratio of Dhamni Cooperative Society was varied from Highest 138.68 in

2012-13 It was at 85.21 ratio in 2010-11 lowest among six years, But the Operating

ratio in same case of Jamlapada Cooperative Societies highest in 112.19 in 2013-14. It

can be concluded that the dhamni and jamlapada Cooperative society has only three

year less to 100 % in study period and Dhamni cooperative society last three years

very high compare to Jamlapada very high ratio indicate operating cost was high in this

year .It Can be Concluded that low percentage show better expence and good

management policy.

Operating ratio of selected cooperative society p value was 0.17 which is More than

0.05 level null hypothesis accepted .it can be concluded that Insignificance of dhamni


The Return on total assets ratio of Dhamni Cooperative Societies was varied from

Highest 24.15 in 2010-11 It was at –22.39 ratio in 2013-14. lowest among six years,

But the Return on total assets ratio in case of Jamlapada Cooperative Societies highest

in 37.20 in 2010-11.and lowest rario was -3.67 in 2013-14. It can be findings that

dhamni Cooperative society has three year very low ratio in study period and

Jamlapada Cooperative society has good maintain ratio in all study period. But Only one

year net loss and better management working to purchase assets.So we can say return on

total assts ratio has Jamlapada cooperative good working. To compare with Dhamni

Cooperative societies

Return on Total assets Ratio of Dhamni and Jamlapada Cooperative society p value

was 0.11 this value more than 0.05 level so, null hypothesis accepted and alternative


Patel Dilipkumar


Page 85

hypothesis rejected.concluded that return on total assets ratio there is no significance

difference between selected firm.

The Return on Capital Employed of Dhamni Cooperative Societies was varied from

Highest 28.77 in 2010-11 It was at -17.37 ratio in 2013-14. lowest among six years,

But the Return on Capital Employed ratio in case of Jamlapada Cooperative Societies

highest in 50.47 in 2010-11.and lowest rario was -6.18 in 2013-14. It can be findings

that Dhamni Cooperative society has three year very low ratio in study period and

Jamlapada Cooperative society has good maintain ratio in all study period but last year

ratio has no Satisfied. return on Capital employed has Jamlapada cooperative Society

good working.

Return on Capital Employed ratio p value 0.11 and this value was more than 0.05 level

so null hypothesis accepted. Concluded that there is Insignificance of selected


Return on Shareholders Equity ratio of Dhamni and Jamlapada Cooperative society p

value is 0.13 which is 0.05 level , So,Null hypothesis accepted and alternative hypothesis

rejected.concluded that selected firm no significantly differ.

Stock Turnover ratio of Dhamni Cooperative society the analysis clearly shows that

ratio was 32.85 2009-10 year Highest ratio And lowest ratio in 2.03 in year 2008-09.

Same case of Stock Turnover ratio of Jamlapada Cooperative society Ratio The

analysis clearly shows that ratio is 32.85 in year 2009-10 Highest ratio And lowest

ratio in 2013-14 in 7.09. It can be findings that Jamalapada cooperative society every

year ratio compare to dixal cooperatives to high ratio. And maintmain satisfied ratio

high ratio showing good sale efficieny but very high is danger. we can say that

Jamlapada cooperative society has good working policy and satisfied turnover ratio.

The calculated P value on Stock turnover Ratio of Dhamni and Jamlapada horticulture


accepted and alternative hypothesis is rejected. It can be Canculated that No

significance difference between Dhamni and Jamlapada Cooperative society.


Patel Dilipkumar


Page 86

The Fixed assets turnover ratio of Dhamni Cooperative Societies was varied from

Highest 4.52 in 2009-10. It was at 0.48 ratio in 2012-13. lowest among six years, But

the Fixed assets turnover ratio in case of Jamlapada Cooperative Societies highest in

82.50 in 2008-9.and lowest rario was 5.59 in 2013-14. It can be findings that

Jamlapada Cooperative society was ratio satisfied and Dhamni society has low ratio

compare with jamlapada cooperative ratio.

The total assets turnover ratio of selected cooperative society p value was 0.04 which

is less than 0.05 level so ,alternative hypothesis accepted and null hypothesis

accepted,it can be concluded that Significance difference between dhamni and


Total assets turnover ratio of Dhamni Cooperative Societies was varied from Highest

1.74 in 2009-10. It was at 0.33 ratio in 2012-13. lowest among six years, But the

Fixed Total turnover ratio in case of Jamlapada Cooperative Societies highest in 2.66

in 2011-12. and lowest rario was 1.58 in 2013-14. Findings that Jamlapada Cooperative

society’s ratio better to compare with dhamni Cooperative society.

Debtors Turnover ratio of Dhamni Cooperative Societies was varied from Highest 86

days in 2012-13. It was at 14 days in 2010-11. lowest among six years, But the

Debtors ratio in same case of Jamlapada Cooperative Societies highest in 66 days in

2008-09 and lowest rario was 13 day in 2011-12. It find that Jamlapada Cooperative

society’s collection policy has good. And Dhamni Cooperatives has long collection

period. I can say that Dhamni Cooperative Society Management take several step and

improve debtors collection policy.

Debtors Ratio of Dhamni and Jamlapada Cooperative society p value was 0.12 this

value more than 0.05 level so, null hypothesis accepted and alternative hypothesis

rejected.concluded that debtors ratio there is no significance difference between selected

firm.

The Current Assets Turnover ratio of Dhamni Cooperative Societies was varied from

Highest 2.83 in 2009-10. It was at 1.05 in 2012-13. lowest among six years, But the


Patel Dilipkumar


Page 87

Current Assets turnover ratio in case of Jamlapada Cooperative Societies highest in

4.50 in 2009-10 and lowest rario was 1.96 in 2010-11. It can be findings that Dhmni

Cooperative society’s and Jamlapada both society was working Satisfied because every

year maintain good ratio Inventry,and other Current assets turnover Management has

satisfied.

Current assets turnover ratio p value 0.26 and this value was more than 0.05 level so

null hypothesis accepted. Concluded that there is no significance difference of selected


Working Capital Turnover ratio of Dhamni Cooperative Societies was varied from

Highest 6.58 in 2013-14. It was at 1.27 in 2008-09. lowest among six years, But the

Working Capital ratio in case of Jamlapada Cooperative Societies highest in 8.04 in

2009-10 and lowest rario was 2.24 in 2013-14. It can be find that Dhamni Cooperative

society’s Working Capital has Low ratio with compare to Jamlapada Coperatives.

The working capital turnover ratio of Dhamni and Jamlapada Cooperative society p

value is 0.77 which is 0.05 level , So,Null hypothesis accepted and alternative hypothesis

rejected.concluded that selected firm no significantly differ.

Suggestion & Conclusion :

The following recommendations are suggested to analysis the financial

performance of Selected Dhamni And Jamlapada Cooperative Societies in

Ahva and Dharampur taluk in Gujarat state of india.

Cooperative Societies should increase the profitability of the Cooperative

societies, Specially suggested to Dhamni Cooperative Society control the cost

of goods sold and operating expenses.

Selected Cooperative Societies Management should try to adopt cost reduction

techniques in their Units to get over this critical situation.


Patel Dilipkumar


Page 88

Cooperatives Management should improve the financial leverage the

management shall build equity capital by collecting shares from existing and

new membership increase

Dhamni Cooperatives should maintain adequate cash reserves from operating

activities.

Gross profit margin ratio of both selected cooperative society is low in all

cooperative society this shows it could not cover its fixed charges, and then the

Societies management better follow pricing policy which says higher price for

produce and lower price for inputs and commodities.

Cooperative societies Management should try to Increase product sale and

make strong marketing policy.

The Cooperative Societies management of the cooperative societies

must pay its liabilities on time to minimize the financial charge paid to

creditors as interest for the amount borrowed.

The management of cooperative Societies should give attention to

decreasing administrative expenses and improve their working

efficiency to gain enough profit and save accumulated profit for capital

growth.

From the above study, concluded that the Study of Solvency ratios,

liquidity ratios, Profirtability ratios, and Activity ratios. This indicates the

cooperative financial position was good (or sound enough) to meet its current

obligations, But current ratio OF Both study absolute liquid ratio of the

cooperative are below the average, standard, that shows the Dhamni

Cooperatives financial position of not satisfactory to meet its short-term

obligations.

Finally, still there is a scope and hope for the betterment to maintain the

optimum level financial stability in future of Both Cooperative Society, if the

cooperative societies operate the activity in efficient manner, try to maintain the

Average level of financial stability in future, it is clear that it will get the great

success among the public, Rural and other type cooperatives also.


Patel Dilipkumar


Page 89

REFFERENCES :

1 Dr. Ruchira Prasad ( 2013 ) “A Case Study of Amul Co operative in India in Relation To

Organizational Design and Operational Efficiency ” International Journal of Scientific &

Engineering Research Volume 4, Issue 1, January-2013 1 ISSN 2229-5518

2. Deepali Kapoor Suri* and Shilpi Singhal ( 2013) “ Comparative Analysis of Financial

Perfomace of Indian Farmer Fertilizer Cooperative Ltd. (IFFCO) ” VSRD International

Journal of Business and Management Research, Vol. 3 No. 6 June 2013 / 217 e-ISSN :

2231-248X, p-ISSN : 2319-2194 VSRD International Journals : www.vsrdjournals.com

3. Anil Kumar Soni and Dr. Harjinder Pal Singh Saluja ( 2012) “ Role of Cooperative Bank

in Agricultural Credit: A Study Based on Chhattishgarh monthly Reffered Journal of

Research in Commerce and Management, Volume No.1, Issue No.10 Issn 2277-1166

4. Dr. M. S. Ramananda And Dr. M. Jayaprakash ( 2012) 7 in their article “ Impact on

Vydhyanandan Committee Recomandations of Wnagapally Primary Agricultural

Cooperative Credit Society ” IJPSS Volume 2, Issue 9 ISSN: 2249-5894

5. Dr.Murali Vallapureddy (2013) “ People of rural India face a lot of hardships to earn

livelihood ” International Journal of Contemporary Business StudiesVol: 4, No: 3. March,

2013 ISSN 2156-7506

6 Dr. M.S. Ramananda ( 2012) “ Ration Analysis of Hydrabad Agricultural Cooperative

Association Operational Functions ” International Journal of Advanced Research in

Management and Social Sciences ISSN: 2278-6236

7 Narayana Gowd Talla , Anand Bethapudi and Reddeppa Reddy G.( 2011) “ An

Analytical study on financial performance of Dharmavaram Urban Co operative Bank,

Andhra Pradesh ( India ) ” National Monthly Reffereed Journal of Research in Commrce

and Managemnt www.abhinavjournal.com, Volume No.2, Issue No.8 Issn 2277-1166

8. Ramesh Chander ( 2010) “ Financial Viability and Perfomance Evalution of Cooperative

Credit Institutions in Hariyana ( India) ” International Journal of Computing and Business

Research (IJCBR) Volume 1, N. 1 December – 2010

9 Paul Trupo (1997)12 in their article “Agricultural Cooperation and Horticultural Produce

Marketing in Southwest Virginia ” Thesis submitted to the Faculty of the Virginia

Polytechnic Institute and State University in partial fulfillment of the requirements for the

degree of Master of Science in Agricultural And Applied Economics.

http://www.vsrdjournals.com/


Patel Dilipkumar


Page 90

10. Kareem, R.O, Arigbabu, Y.D, Akintaro, J.A & Badmus, M.A(2012) “ The Impact of Co-

Operative Society on Capital Formation (A Case Study of Temidere Co – Operative and

Thrift- Society, Ijebu- Ode, Ogun State, Nigeria). Global Journal of Science Frontier

Research Agriculture and Veterinary Sciences Volume 12 Issue 11 Version 1.0 Year 2012

Type : Double Blind Peer Reviewed International Research Journal Publisher: Global

Journals Inc. (USA) Online ISSN: 2249-4626 & Print ISSN: 0975-5896

11. Dr. Kaneez Fatima Sadriwala and Dr. Ayoob.C.P. ( 2004) 15 in research “ Efficiency

Structure of Co-operative Agricultural Marketing Societies - A Case Study of Coconut

Marketing Societies of Kerala State” Assistant Professor at College of Economics,

Management and Information System, University of Nizwa, Sultanate of Oman.

WEBSITES :

http://accountlearning.blogspot.in/2010/02/methods-or-techniques-of-financial.html

http://www.pib.nic.in/feature/fe0299/f1202992.html

http://www.yourarticlelibrary.com/india-2/history-of-co-operative-movement-in-india-

1047-words/4798/

http://en.wikipedia.org/wiki/History_of_the_cooperative_movement

http://www.yourarticlelibrary.com/india-2/history-of-co-operative-mo...

http://www.publishyourarticles.net/knowledge-hub/business-studies/wh...

http://www.umanitoba.ca/afs/agric_economics/ardi/history.html

http://www.learningcentre.coop/content/what-co-operative

http://agriculture.indiabizclub.com/info/agriculture_cooperatives

http://i2biz.blogspot.in/2009/08/types-of-cooperative-societies.html

http://www.publishyourarticles.net/eng/articles/what-are-the-different-.

http://www.publishyourarticles.net/eng/articles/what-are-the-main-adv...

http://studypoints.blogspot.in/2011/06/merits-or-advantages-of-coopera...

http://www.businessdictionary.com/definition/income-statement.html#ixzz3GcIkmNyi

http://www.businessdictionary.com/definition/financial-statement.html#ixzz3GcJ58Nsr

http://www.accountingtools.com/definition-financial-statemen

http://www.accountingcoach.com/balance-sheet/explanation

http://accounting.fundamentalfinance.com/balance-sheet-introduction.php

https://ilex.kin.tul.cz/~olga.malikova/multiedu/FIU_N/CH7.pdf

http://accountlearning.blogspot.in/2010/02/methods-or-techniques-of-financial.html

http://www.pib.nic.in/feature/fe0299/f1202992.html

http://www.yourarticlelibrary.com/india-2/history-of-co-operative-movement-in-india-1047-words/4798/

http://www.yourarticlelibrary.com/india-2/history-of-co-operative-movement-in-india-1047-words/4798/

http://en.wikipedia.org/wiki/History_of_the_cooperative_movement

http://www.yourarticlelibrary.com/india-2/history-of-co-operative-mo

http://www.publishyourarticles.net/knowledge-hub/business-studies/wh

http://www.umanitoba.ca/afs/agric_economics/ardi/history.html

http://www.learningcentre.coop/content/what-co-operative

http://agriculture.indiabizclub.com/info/agriculture_cooperatives

http://i2biz.blogspot.in/2009/08/types-of-cooperative-societies.html

http://www.publishyourarticles.net/eng/articles/what-are-the-different-

http://www.publishyourarticles.net/eng/articles/what-are-the-main-adv

http://studypoints.blogspot.in/2011/06/merits-or-advantages-of-coopera

http://www.businessdictionary.com/definition/income-statement.html#ixzz3GcIkmNyi

http://www.businessdictionary.com/definition/financial-statement.html#ixzz3GcJ58Nsr

http://www.accountingtools.com/definition-financial-statemen

http://www.accountingcoach.com/balance-sheet/explanation

http://accounting.fundamentalfinance.com/balance-sheet-introduction.php

https://ilex.kin.tul.cz/~olga.malikova/multiedu/FIU_N/CH7.pdf


Patel Dilipkumar


Page 91

https://www.boundless.com/accounting/textbooks/boundless-accounting-

textbook/introduction-to-accounting-1/conveying-accounting-information-

20/introduction-to-the-balance-sheet-121-3760/

http://www.theguardian.com/small-business-network/2014/jun/09/guide-profit-loss-

acounts-small-business

Bibliography

o Agrawal N.P. ( 1981) in the book Analysis of Financial statements”

In publication National publishing House,New Delhi

o Chaudhari S.B. ( 1964) in book “ Analysis of company financial statement on published

throgh Asia publishing House,London

o Gupta R.L.(1980)in the book “ Financial Statement Analysis” in publishedthroghSultan

chand And sons,New Delhi

o Jain P.K ( 1988) in the book “.management of State enterprise in india” published

through National Publishing House,Jaypur

o Guthmanan H.G. (1968) in their book “ Analysis of Financial Statement ” in published

through Prentiese Hall of india Pvt.Ltd,New Delhi

https://www.boundless.com/accounting/textbooks/boundless-accounting-

http://www.theguardian.com/small-business-network/2014/jun/09/guide-profit-loss-acounts-small-business

http://www.theguardian.com/small-business-network/2014/jun/09/guide-profit-loss-acounts-small-business


Patel Dilipkumar


Page 92

About the Author

AUTHERS INTRODUCTION

PATEL DILIPKUMAR

Birth Date : 11/05/1988 .

Graduated from B.com , Arts and Commerce college, Motapondha

in South Gujrat university, Surat, Post Graduated from M.Com With

Specialization of Financial Accountancy from Sir.K.P.College of

Commerce,Surat in South Gujrat University Surat.Bechalar of

Education (B.Ed.) from , College of Education Kharod in South

Gujarat University Surat.

Now. Research Scholar in Pacific University in Udaipur,(Rajasthan)

Research Area Interest : Commerce , Accountancy.

financial analysis of cooperative society

Documents