make in india start up 210316

SSAR & ASSOCIATES, Chartered AccountantsSSAR & ASSOCIATES, Chartered Accountants

•• Knowledge Knowledge about the about the CampaignsCampaigns

•• Useful Business Practices for SMEsUseful Business Practices for SMEs

•• Opportunities available Opportunities available for us as for us as CAsCAs


•• MakeMake‐‐inin‐‐India, StartIndia, Start‐‐ups, …….ups, …….

–– Concepts Concepts (Awareness , Progress so far, The Need of the (Awareness , Progress so far, The Need of the Programs?)Programs?)

•• Broad SegmentsBroad Segments

–– SMESME

–– StartStart‐‐upsups

•• Role & Opportunities for CAsRole & Opportunities for CAs

–– ThreatsThreats

–– OpportunitiesOpportunities

•• PrePre‐‐requisites requisites for Programs for Programs successsuccess

–– Threats before SMEsThreats before SMEs

–– Useful Business Practices for Better ProfitsUseful Business Practices for Better ProfitsSSAR & ASSOCIATES, Chartered AccountantsSSAR & ASSOCIATES, Chartered Accountants

The Need for Learning & The Need for Learning & Giving BackGiving Back

DIRECT ACCESS TO CEO / OWNERSDIRECT ACCESS TO CEO / OWNERS

CAN BRING CHANGE IN ORGANISATION FOR BETTERCAN BRING CHANGE IN ORGANISATION FOR BETTER

KNOWS THE ENTIRE

BUSINESS / OPERATIONS

EXPERT KNOWLEDGEEXPERT KNOWLEDGE

• ACCOUNTING

• BUSINESS PROCESSES

• ASSURANCE

• COMPLIANCES

• FINANCE

IncreasingIncreasing

ShrinkingShrinking

ShrinkingShrinking

ASSURANCE SERVICES

Low Margins for Indian FirmsLow Margins for Indian Firms

Acc. StandardsAcc. Standards

More ResponsibilitiesMore Responsibilities

Risks (NFRA + Special Courts)Risks (NFRA + Special Courts)

DOCUMENTATION

COMPLIANCE OFFICER

CLIENT’SCLIENT’SOUROUR

Building PartnershipBuilding Partnership

MY GROWTH = CLIENT’S GROWTHMY GROWTH = CLIENT’S GROWTH

Mentors +

Professionals

Processes need to be built / reviewed / overhauled in SMEs / Start‐ups by CAs Remunerative Management Consultancy

Huge Trainer Opportunities with Govt. Huge Trainer Opportunities with Govt. CampaignsCampaigns

Questions?Questions?

Q1: Why should I look into business consultancy when the SME doesn’t value these services?

Q2: Is there a scope of hike in fees in traditional services?

Q3: I have never provided such services and I will work when demanded by the Client in Future

Is it the Right Approach?

Q4: Is it the Right Time?

Govt. CampaignsGovt. CampaignsCampaign Launch Date Target

Make‐in‐ India (MII) 25.09.2014 SME

Zero Defect Zero Effect (ZED) 15.08.2014 SME

Lean Mfg. Competitiveness Scheme (LMCS)

Year 2009 SME

E‐Biz Portal 19.02.2015 SME / Start‐up

Digital India 01.07.2015 Start‐up

“Skill India” Logo 16.07.2015 SME / Start‐up

Start‐up India 16.01.2016 Start‐up


Huge Data AvailabilityHuge Data AvailabilityCampaign Link

Make‐in‐ India (MII) www.makeinindia.com

Zero Defect Zero Effect (ZED) www.zed.org.in

Lean Mfg. Competitiveness Scheme (LMCS)

DCMSME / MSME / QCI / NPC

E‐Biz Portal www.ebiz.gov.in

Digital India www.digitalindia.gov.in

Skill India www.skilldevelopment.gov.in

Start‐up India ‐


What is MII?What is MII?

• Launch Date: 25.09.2014

• An initiative of the GOI to encourage multi‐national, as well as domestic, companies to manufacture their products in India

• Campaign was designed by Wieden + Kennedy (Associated with popular campaigns of Nike “Just

do it”, Coca‐cola, Honda, P&G, ESPN, Microsoft, etc.)

What is MII?What is MII?

AIMS

• Top destination globally for FDI, surpassing China as well as the US

• To focus on job creation and skill enhancement in 25 sectors of the economy

• Production at high quality standards and minimising the impact on the environment

• Job creation

• India ‐ Self‐reliant country & Global Recognition

25 Sectors25 Sectors

Automobiles Food Processing Renewable Energy

Automobile Components IT and BPM Roads & Highways

Aviation Leather Space

Biotechnology Media and Entertainment Textiles & Garments

Chemicals Mining Thermal Power

Construction Oil & Gas Tourism and Hospitality

DefenceMfg Pharmaceuticals Wellness

Electrical Machinery Ports and Shipping

Electronic Systems Railways

100% FDI is permitted in all the above sectors, except for space (74%), defence (49%) and news media (26%)

www.makeinindia.comwww.makeinindia.com

• Participation

– 2500 – International Companies

– 8000 – Domestic Companies

– 68 Countries – Foreign Government Delegations

– 72 Countries – Business Teams

– 17 – Indian States• Asper Mr. Amitabh Kant (DIPP Secretary)

– Investment commitments – INR 15.2 Lakh Cr. (US$ 220 billion)

– Investment inquiries ‐‐ INR 1.5 Lakh Cr. (US $22 billion).

– Maharashtra Investment Commitments – INR 8 Lakh Cr.(US$120 billion)

MakeMake‐‐in in India WeekIndia Week‐‐ 13 13 –– 20.02.16 20.02.16 –– MumbaiMumbai

Work so FarWork so Far

Part of MakePart of Make‐‐in Indiain India

• Ease of Doing Business

• ZED (Zero Defect Zero Effect)

• Skill India

• Ebiz Portal

• Lean Mfg. Competitiveness Scheme (LMCS)

Recalculated as 134

Ease of Doing BusinessEase of Doing BusinessRanking upgradation

Topics DB 2016 Rank DB 2015 Rank Change in Rank

Overall Ranking 130 134 +4

Starting a Business 155 164 +9

Dealing with Construction Permits 183 184 +1

Getting Electricity 70 99 +29

Registering Property 138 138 No change

Getting Credit 42 36 ‐6

Protecting Minority Investors 8 8 No change

Paying Taxes 157 156 ‐1

Trading Across Borders 133 133 No change

Enforcing Contracts 178 178 No change

Resolving Insolvency 136 136 No change

Source: www.doingbusiness.org SSAR & ASSOCIATES, Chartered AccountantsSSAR & ASSOCIATES, Chartered Accountants

Target: Top 50

Principles of Ease of Doing Business

• Convert from manual to online

• Eliminate touch points with applicants

• Prepare checklists, adhere to them

• Prepare timelines, punish delays

• Share information across platforms

• Eliminate unnecessary steps and requirements

• Promote self‐compliance, self‐certification

16 Punjab 36.73%

State – wise Ranking

Source: Assessment of State Implementation of Business Reforms, September 2015 published by DIPP

DIPP InitiativesDIPP Initiatives

• Constitution of 11 members ‐ Expert Committee under DIPP (06.04.2015)

– Business Reform Action Plan for States/UTs Implementation Guide for States (Dec, 2015)

– Recommendation to States (340 Final Points)

– Largely State Subjects

1. Access to Information and Transparency Enablers 2a. Single Window2b. Online Single Window System3a. Availability of land3b. Land Allotment 3c. Property Registration ‐ Enablers 3d. Property Registration 4a. Construction Permit Enablers 4b. Building Plan Approval 4c. NOC for tree felling from Tree Authority/ Appropriate

Authority (prior to commencement of construction activities)

4d. NOC for Fire Department (prior to commencement of construction activities)

5a. Environmental Registration Enablers 5b. Consent to Establish under Water (Prevention and Control

of Pollution) Act, 19745d. Authorization under Hazardous Waste (Management and

Handling) Rules, 1989 5e. Consent to Operate under Water (Prevention and Control

of Pollution) Act, 1974 5f. Consent to Operate under Air (Prevention and Control of

Pollution) Act, 19816a. Labour Regulation Enablers6b. Registration and grant of license under The Factories Act,

19486c. Approval of plan and permission to construct/extend/or

take into use any building as a factory under the Factories Act, 1948

6d. License under The Indian Boilers Act, 1923

6e. License for contractors under provision of The Contracts Labour (Regulation and Abolition) Act, 1970

6f. Registration under The Shops and Establishment Act6g. Registration of principal employer's establishment under

provision of The Contracts Labour (Regulation and Abolition) Act, 1970

6h. Registration under The Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996

6i. Renewal of license under The Factories Act, 1948 6j. Renewal of license under The Indian Boilers Act, 1923 6k. Renewal of license for contractors under provision of The

Contracts Labour (Regulation and Abolition) Act, 1970 6l. Renewal under The Shops and Establishment Act7a. Obtaining Electricity Connection 7b. Obtaining water connection

8a. Online tax return filing 8b. Online tax payment8c. Tax enablers 8d. Registration for Value Added Tax (VAT)8e. Registration for Central Sales Tax (CST) 8f. Registration for Professional Tax 8g. Registration for Entry Tax8h. Registration for Entertainment Tax 8i. Registration for Luxury Tax 9a. Inspection reform enablers 9b. Inspection of the business premises for VAT (Value

Added Tax) registration 9c. Inspection by Building Proposal Office/ relevant

agency as part of obtaining construction permit

9d. Inspection by Appropriate Authority for felling trees (prior to commencement of construction activities)

9e. Inspection by Building Proposal Office/ relevant agency as part of obtaining occupancy certificate

9f. Compliance Inspections under The Equal Remuneration Act, 1976

9g. Compliance Inspections under The Factories Act, 1948 9h. Compliance Inspection under The Minimum Wages Act,

1948 9i. Compliance Inspection under The Shops and

Establishments Act (as applicable9j. Compliance Inspection under The Payment of Bonus Act,

19659k. Compliance Inspection under The Payment of Wages Act,

1936

9l. Compliance Inspection under The Payment of Gratuity Act, 1972

9m. Compliance Inspection under The Contract Labour (Regulation and Abolition) Act, 1970

9n. Compliance Inspection under The Water (Prevention & Control of Pollution) Act, 1974

9o. Compliance Inspection under The Air (Prevention and Control of Pollution) Act, 1981

10a. Commercial Dispute Resolution Enablers10b. Paper‐less Courts

Implementations so farImplementations so far

• Industrial Licence (IL) + Industrial Entrepreneur Memorandum (IEM) Online Ebiz (24X7) + Simplified Application Forms

• Industrial Licence: Validity period: 2 yrs 3 yrs

• Security clearances on IL applications by MHA within 12 weeks

• 29 Services Linked on Ebiz portal

• Limiting documents for Export & Import 3

• …….


Companies Act, 2013

• Integrated process of incorporation of a company (INC‐29)

• Companies (Amendment) Act, 2015

• Notifications‐ 05.06.2015 (Exemptions to Pvt. Ltd. Cos.; Govt. Cos.)


Income‐tax• Budget, 2016• Appeal and Cross‐Objections before ITAT & HC – revision

in limit (Dec, 15)• Online Application before CIT (Not. 11/2016 dt. 01.03.16)• E‐Assessments (Reduction of interface)• Mandatory passing of 154 Notice (Instruction 2/2016 dt.

15.02.16)• Timeline for verification of Sec. 245 demand and issue of

refunds (30 D 15 D) (Office Memorandum‐07.03.2016)• Taxability of surplus on sale of shares and securities ‐

Capital Gains or Business Income – (Circular 6/2016‐29.02.16)

• Requirement of CA Certificate (Not.93/2015 dt.16.12.15)

• Sec. 80JJAA


Income‐tax – Sec 80 JJAA• 30% of additional wages paid to new regular workmen in a factory for 3 years

• Budget 2016

– Min. days of Employment: 300 Days 240 days

– 10% increase in number of employees deleted

– First year of business: NA 30 % on all Salary

– …….

vs.


Customs & Excise (Budget, 2016)• Changes in customs and excise duty rates on certain inputs, raw materials, intermediaries and components and certain other goods in sectors – Information technology hardware, – capital goods, – defence production, – textiles, – mineral fuels & mineral oils, – chemicals & petrochemicals, – paper, – paperboard & newsprint, – Maintenance repair and overhauling [MRO] of aircrafts and ship repair

Country’s Brand StatusCountry’s Brand Status

More InformationMore Information

• //dipp.nic.in

• www.EBIZ.gov.in

ZEDZED• MSMEs contribute nearly 8% to the country's GDP, 45% to manufacturing output and 40% to exports.

• India has close to 35 million MSMEs with 95% employing less than 10 people. The rest 5% employs 10 to 100 people.

• Model to rate and handhold 1 million SMEs over the next 3 ‐ 5years to deliver top quality products using clean technology

•• VisionVisionTo enable the advancement of Indian industry to a position of eminence in the global marketplace and leverage India’s emergence as the world’s supplier through the ‘Made in India’ mark.


ZED ZED ‐‐ MissionMission

To develop and implement a ‘ZED’ culture in India based on the principles of:

• Zero Defect (focus on customer)– Zero non‐conformance/non‐compliance

– Zero waste

• Zero Effect (focus on society)– Zero air pollution/liquid discharge (ZLD)/solid waste

– Zero wastage of natural resources

www.zed.org.in/mission.php


ZED ZED ‐‐ BenefitsBenefits

• Credible recognition of the industry for international customers seeking investment in India

• Streamlined operations and lower costs• Superior quality, reduced rejection and higher revenues

• Increased environmental & social benefits• Additional employment generation• Other benefits as announced by the Government from time to time

SAR & ASSOCIATES, Chartered AccountantsSAR & ASSOCIATES, Chartered Accountants


www.zed.org.in

Competitiveness Scheme (LMCS)

Features Features ‐‐ LMCSLMCS




Skill IndiaSkill India

• “Skill India Logo” launched by PM on 16.07.2015

• Aim to train over 40 Cr. people in India in different skills by 2022

• Initiatives include – National Skill Development Mission

– National Policy for Skill Development and Entrepreneurship 2015,

– PradhanMantri Kaushal Vikas Yojana (PMKVY) scheme; and

– Skill Loan scheme

SSSAR & ASSOCIATES, Chartered AccountantsSAR & ASSOCIATES, Chartered Accountants

Pradhan Mantri Kaushal Vikas Yojana (PMKVY) Features

• Standards

• Direct Fund Transfer

• Demand‐drive targets

• Target aligned to national flagship programmes and regions

• Supply side perspective in target fixation

• Recognition of prior learning (RPL)

• Variable amount of monetary reward

www.skilldevelopment.gov.in/pmkvy.html

www.pmkvyofficial.org


Pradhan Mantri Kaushal Vikas Yojana (PMKVY) Features

• Robust regime for registration of training providers

• Focussed awareness building and mobilisation activities

• Improved curricula, better pedagogy and trained instructors

• Enhanced monitoring• Mentorship support• Evaluation• Grievance redressal

www.skilldevelopment.gov.in/pmkvy.html

Process ManualProcess Manual


Research reports from KPMG


SSSAR & ASSOCIATES, Chartered AccountantsSAR & ASSOCIATES, Chartered Accountants

SKILL INDIA Benefits

As on 15 February 2016• the Indian Leather Development Programme

– Trained ‐51,216 youth in the past 100 days (Plan‐1,44,000 annually)

• Four new branches of Footwear Design & Development Institute —at Hyderabad, Patna, Banur (Punjab) and Ankleshwar (Gujarat) — are being set up to improve training infrastructure– The industry undergoing acute skill shortage and most of the people trained are being absorbed by the industry

Source: en.wikipedia.org/wiki/Skill_India


SKILL INDIA Benefits

UDAAN• Special Industry Initiative for J&K to provide skills training

and enhance the employability of unemployed youth of J&K

• As on 10.07.2015

Source: www.skilldevelopment.gov.in/udaan.html

Milestones Figures

Youth who have joined Udaan training programs till date 10,555

Placement Offers Made 4,984

Cumulative Corporates successfully partnered with Udaan 74

Cumulative commitment for 5 years 94,300

Udaan selection drives conducted till date 585


Scheme of Entrepreneurship DevelopmentFeatures

• Educate and equip potential and early stage entrepreneurs across India

• Connect entrepreneurs to peers, mentors, incubators

• Support entrepreneurs through Entrepreneurship Hubs (E‐Hubs)

• Catalyse a culture shift to encourage entrepreneurship

• Encourage entrepreneurship among underrepresented groups

• Promote Entrepreneurship amongst Women

• Foster social entrepreneurship and grassroots innovations

Source: www.skilldevelopment.gov.inSSAR & ASSOCIATES, Chartered AccountantsSSAR & ASSOCIATES, Chartered Accountants


StartStart‐‐upup

• Launched 16.01.2016

• Encourage entrepreneurship.

• India across the world as a start‐up hub.

• 5 lakh schools to target 10 lakh children for innovation programme

• MUDRA Loan (Shishu; Kishore; Tarun) (www.murda.org.in)


DIPP Notification – 17.02.206

• Not a Start‐up?– entity formed by splitting up or reconstruction of a business already in existence

– Turnover > Rs.25 Cr. OR after 5 years

• For recognition as Start‐up– to obtain a certificate of an eligible business from the Inter‐Ministerial Board of Certification consisting of:

• Joint Secretary, Department of Industrial Policy and Promotion,

• Representative of Department of Science and Technology, and

• Representative of Department of Biotechnology



Tax deduction @ 100% of Profits for the 3 of first 5 years of Profits

(Sec. 80‐IAC)

Exemption of LTCG on investment into eligible start‐up

Reduction in Corporate Tax

Extension of tax holiday benefit for SEZs commencing activity before

Mar 31, 2020

Ease of Registration

Hub for SC/ST & Women Entrepreneurs

Deduction in respect of employment of new employees

[Section 80 JJAA]

Taxation of Income from Patents [Section 115BBF]

Others

Research reports from KPMG


PassPass‐‐outs vs. Placementsouts vs. Placements

• No Job for 20‐33% out of the 1.5 million engineering graduates passing out every year run (http://dazeinfo.com)

• 65 per cent passed students are jobless ‐Campus Preparedness Survey 2015(Source: http://liveonindia.com)

• 34% employable (Survey of 1,00,000 candidates across India) – India Skills Report ‐ 3rd CII National Conference on Skill Development

INDIA INDIA (Before General Election, 2014)(Before General Election, 2014)

Global ShareGlobal Share

Brand IndiaBrand India

• Rich Heritage

• Strong Cultural Diversity

• Huge Customer Base

• Youth Population

Indians AbroadIndians Abroad• 15% of startups in Silicon Valley being founded by Indians (2014 study by Professor VivekWadhwa)

• Sundar Pichai, CEO, Google• Satya Nadella, CEO, Microsoft• Vinod Khosla, Co‐founder, Sun Microsystems• Rashmi Sinha, Co‐founder, SlideShare• Shantanu Narayen, CEO, Adobe• Indra Nooyi, CEO, Pepsico• Srikanth ‘Sri’ Srinivasan, Judge for the US Court of Appeals for the District of Columbia Circuit (17.02.2016)

• The Most Innovative and Economical Method to accomplish the desired task by unusual / unimaginative means & ways

• Juggad + Quality Processes need to be promoted though Start‐ups and spread Globally

CHALLENGES BEFORE SMEsCHALLENGES BEFORE SMEs

Become a GUIDE to CEO

Become a COACH to CEO

Department / Functions Invisible Elements Live Wires Extended Team

OrganisationStructure

Production Vacuum / Demand

Leadership Computer‐isation

Customers

Marketing Store Branding New Market MIS Suppliers

Purchase Compliance Strategy Product Pricing Communication

Accounts Treasury CSR Risk Mgt. Budgets

Finance Quality Quality (Value) Fixed Asst. Mgt.

Investment Training KPIs/ Dashboards

Product Strategy

Personnel Public Relations

Document‐ation

Crisis Mgt.

R&D Audit Personal Life Asset & Data Security

Administration Packaging & Labeling

Logistics PR

SSAR & ASSOCIATES, Chartered accountantsSSAR & ASSOCIATES, Chartered accountantsGrow More …. Grow FasterGrow More …. Grow Faster

• No Organisation can work without Team unless Fully Automated

• Machines don’t create Life BUT People DO in an Organisation

• Primary Difference between Winning & Losing Team is LEVEL OF MOTIVATION “Chak De” creates WONDERS UNEXPECTED gets created

• REPLICATION OF PERFECTION is the need of hour

• Expansion can HAPPEN with IN‐HOUSE BATTERY OF LEADERS

• Team needs to be NURTURED


• Hire People with Quality Attitude

• Constantly Identify Leaders for managing Depts / Responsibilities

• Alignment of Personal & Departmental Goals with OrganisationGoals by Constant Reinforcement

• Culture of Internal Competition (Regular Appraisals, Appreciation, Recognition, Rewards …..)

• Regular Training & Cross Skill ‐Training

• Capture Feedback & Complaints (Implement or Resolve)

• Define “Job Description” bring Clarity of Job Profile


• No Customer = No Profit = No‐Business

• Average business doesn’t hear from 96% of unhappy customers

• For every 1 complaint received, there are 24 people with unvoiced problems, 6 of which are serious

• >= 90% who are dissatisfied with the service they receive will not buy again or come back

• Of those who complain, 50% ‐ 70% will do business again if complaint is resolved. 95% will return if resolved quickly.

• Average customer with a complaint tells 9 to 10 people, 13% tell more than 20 people.

• Those who have complained and had resolution tell 5 people

Keep ears on the Ground and Listen

ENTIRE WORLD AVAILABLEArbitrage options ALWAYS EXIST

FLOWFLOW

Batch Vs. Single piece

What Stops

How Frequently SME checksHow Frequently SME checks

•• Balance Sheet Balance Sheet (Where funds got stuck?)(Where funds got stuck?)

•• P&L P&L (Whether Profit or Loss ?)(Whether Profit or Loss ?)

•• ReceivablesReceivables

Monthly / Quarterly / HalfMonthly / Quarterly / Half‐‐yearly / yearly /

Yearly ???Yearly ???

• To Analyse Each Expense‐Head and Identify its Cost Drivers.

• Enquire whether they can be Optimisedto Improve the End‐Benefits (Cost‐Benefit Analysis)

• Define Routines (Daily / Weekly /……..)

• Ensure that they are carried out and become Habbits.

• Actions ONLY create Reality.

DEFINEDEFINE

• TOOLS ARE MANY …….

• LOT OF IMPROVEMENT THEORIES (Lean, Six Sigma, TOC, ISO ….)

• THE FOCUS IS ON BUSINESS IMPROVEMENT:– Cost Optimisation alongwith

– Revenue Maximisation

&

SUCCEED

उित्तष्ठतउित्तष्ठत:: जामतजामत:: ूाप्यूाप्य:: वरािन्नबोधतवरािन्नबोधत::

AriseArise! Awake! Approach the great and ! Awake! Approach the great and learn.learn.

THANK YOUTHANK YOU

SANDEEP GARG, FCA, ICWASANDEEP GARG, FCA, ICWAS S SS A R & ASSOCIATESA R & ASSOCIATES

Ph: (011) Ph: (011) 6596091265960912‐‐13, 981002050813, [email protected]@ssarca.com

www.ssarca.comwww.ssarca.com

www.revitalisedprocesses.comwww.revitalisedprocesses.com

make in india start up 210316

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