rajitha(wc iocl)

8/7/2019 Rajitha(WC IOCL)

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INTRODUCTION

Finance is a scare resource and it to be managed efficiently for the successful functioning of an

enterprise. Inefficient financial management has resulted in failure of many businesses

organization. Irrespective of any in difference in structure ownership and size, the finance

organizations of enterprise caught to be capable of ensuring that the various finance functions

planning and controlling are carried out at the highest degree of efficiency.

It is the lifeblood of every business activity without which the wheels of modern business

organizations system cannot be greased. Thus the finance function assumes an important

role in affairs of business management. The profitability and suitability of the business depends

upon the manner how finance and the function are performed and related with other business

functions.

Finance has to be systematically controlled and regulated so that it may be contribute to

different functions of business administration such as purchasing production and marketing. It

is difficult to aggregate the finance functions from that of general business management. Simply

finance intertwined with every business functions.

Before the turn of the present century finance was studies as part of economics. It was onlybusiness of the present century that corporation finance evolved as a separate subject with special

emphasis on the study capital market. The term corporate finance was used to describe what is

known in the academic world as financial management.

AN OVER VIEW OF WORKING CAPITAL

Now-a-days management of Working Capital has to be recognized as one of the basic future of

financial management, for successful conduct of business activities.

Working Capital management has become more and more important due to already shift towards

closer internal financial control. The main objective of working capital management thus, us to

ensure smooth functioning of the business and to gets timely funds sufficiently. In the opinion of

Zenoff and Zwick, Proper management of Working Capital is very important for the


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success of an enterprise. It aims at protecting the purchasing power of asset and maximizing the

return on investment .

The effective management of working capital involves the balancing of current assets and

current liabilities in order ensure a reasonable margin of safety. In other words it is to manage

each of the firm's current assets and current liabilities in such away that an acceptable level of net

working capital is maintained.

Working Capital management has been looked upon as the driving seat of financial manger.

Constant Management is required to maintain appropriate levels in the various working capital

accounts. The importance that has been a given in economically advanced countries, was not

seriously considered and applied to many of the industries in India

Working Capital management has assumed great importance in recent times due to the

professionalism that has been brought into organization , in financial management of the

business enterprises. The theoretical frame of working capital management and its application in

the selected sugar factories is the subject matter of this chapter.

DEFINITION OF WORKING CAPITAL

Working Capital sometimes called as Net Working Capital is represented by the excess of

current assets over the current liabilities and identified the relatively liquid portion to total

enterprise capital which constitutes a margin of buffer for maturing obligations within the

ordinary operating cycle of the business.

'Working Capital is a excess of current assets over current liabilities'

Like the broader concept to capital there is no universally accepted definition for Working

Capital.

The following are some definitions of this group:

Working Capital means Current Assets

-MEAD, BAKER, MALOTT-

The sum of the Current Assets in the Working Capital of a Business.

-J.S.MILL-


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Any acquisition of funds of which increase the Current Assets increase Working Capital also,

for the are one and the same

-BONNEVILE-

Working Capital refers to a firm's investment in short-term Assets like cash, short term

securities, Account receivables and inventories.

-WESTON&BRIGHAM-

In the Narrow sense, the working capital id regarded as the Excess of Current assets over

current liabilities. This is the definition used by most financial experts and authors rephrasing

the accounting phase of finance.


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OBJECTIVES OF THE STUDY

In this chapter, objectives of the study and methodology employed are discusses in following

paragraph the methodology includes various items like sources of data, methods of data

collection significance of the study and limitations of the study.

To study the existing system of the working capital management in IOCL

To examine the feasibility of present system of managing working capital in most

effective manner.

The analyze the financial performance of the company using working capital

To give some pertinent suggestion to the management of IOCL about the working capital

management.

NEED FOR THE STUDY

The most important functions of the business firm are production, marketing finance. It is

very difficult to separate finance functions from production, marketing and other functions. The

functions of raising funds, investing them in assets and distributing returns earned from assets to

share holders are respectively known as financing, investing and dividend decisions. In doing

so, a firm attempts to balance cash inflow and outflows. Finance function call for skillful

planning control and execution of firm's activities.

Hence, the study is taken to analyze the firm's activities through Working Capital

Management.


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LIMITATIONS OF THE STUDY

Every study is conducted under some limitations. This study is not exception the main

limitations are.

The study is conducted by a student of K.U University for the purpose of fulfillment of

the condition stipulated by the University for the Completion the course. So the study

may not fulfill all the requirement of a detail investigation.

This is a study conducted with in a period of Severn weeks in total.

During this limited period of the study. It may not be a detailed, full-fledged and

utilitarian in all respects.

The study was conducted with the data available and the analysis was made accordingly.


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METHODOLOGY OF THE STUDY

The following methodology has been used to the carryout the present study "Working Capital

Management in IOCL". To carry out the present study, both primary and secondary data have

been used. Primary data have been collected from officers and staff of finance and accounts

department of IOCL.

Secondary data on the other hand form the printed material of the company balance sheets and

profits and loss account of the year from 2006-2010 of IOCL, cashbooks, debtors ledgers and

stock registers, annual reports. Article from the journal "The Management Accounting book",

text books etc.

RESEARCH METHODOLOGY

Data collection:

The methodology of the study interrelations is to understand the procedural aspects of

INDIAN OIL CORPORATION LTD and than to proceed with analysis of the financial

performance.

Primary Data:

Personal Interview was held with key personnel of finance department.

Secondary Data:

Published annual reports for 5 years (2005-06 to 2009-10).

Web Site www. IOCL.com . Newspapers like Ennadu, The Hindu Etc.


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RESEARCH TOOLS:

1. Statement of changes in working capital.

2. Trend Analysis.

A) Capital trend.

B) Sales trend.

C) PBT trend.

D) PAT trend.

3. Ratio Analysis.

A) Liquidity Ratios

B) Activity Ratios

C) Assets Turnover Ratios.

METHODOLOGY

The methodology to be followed here is -

Preparation of numeric data tables with data of accounting year wise factors of ratios with

calculated ratios.

Graphical presentation of the ratios indicating changes.

Interpretation with the help of numeric and graphical presentation.

Opinion based on result on result of the analysis with conclusion.


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Company Profile

Indian Oil Corporation Limited

Indian Oil Corporation Ltd. (IndianOil) is the largest commercial enterprise in

India, and the only Indian presence in the Fortune magazines global 500 listing

of the worlds largest corporations, with a ranking of 226 for fiscal 2001. In the

Forbes International 500 list of the largest companies outside US, IndianOil is

ranked 112 and tops the four Indian companies in the listing. In addition to being

the largest national oil company in the Asia Pacific region, IndianOil has also been

ranked First in Petroleum Trading among the 15 national oil companies in the

region in the 2001 Industry Perception Survey conducted by Applied Trading

Systems, Singapore. Indian Refineries Ltd. And Indian Oil Company Ltd. were set

up in 1958 and 1959 respectively, to build national competence in the oil refining

and marketing business. On 1st September 1964, these two companies were

merged to form Indian Oil Corporation Ltd. IndianOil owns and operates seven ofthe countrys 18 refineries, at Digboi, Panipat, with a combined capacity of 38.15

million metric tones per annum (MMTPA). A new MMTPA grassroots refinery is

being set up at Paradip in Orissa. In addition, IndianOil has two subsidiary

companies, Chennai Petroleum Corporation Ltd. And Bongaigaon Refinery and

Petrochemicals Ltd., with a combined refining capacity of 9.35 MMTPA, thereby

raising its total refining capacity to 47.50 MMTPA, the highest in the country

today. IndianOil has the countrys largest network to crude and product pipelines,

with a combined length of 6,523 km and a capacity of 43.45 MMTPA. With sales

of 47.17 million metric tones in 2001-02, IndianOil holds over 53% of the

petroleum products market share in India.


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Its extensive network of over 22,000 sales points is backed for supplies by 182

bulk storage points and 78 Indane bottling plants. 92 Aviation Fuel Stations cater

to the Aviation Industry, defence as well as civil.

IBP Co. Limited, a stand-alone marketing company and a subsidiary of IndianOil,

has a nationwide network of over 1,550 retail outlets.

IndianOils Research and Development Centre has been engaged in world-class

research in tribology (lubricants formulation), refinery processes and pipeline

transportation. The Centre has developed over 2000 lubricant and grease

formulations, and obtained approvals of original equipment manufactures in Indiaand abroad.

A wholly owned subsidiary, Indian Oil blending Ltd., manufactures over 450

grades of the countrys leading R brand of lubricants and greases. In pursuit of its

Vision of becoming a major, diversified, transnational, integrated energy

company, with national leadership and a strong environment conscience, playing a

national role in oil security and public distribution, IndianOil is proactively

identifying and developing business opportunities in Exploration & Production

(E&P), Gas and Gas-to-Liquid, Petrochemicals, Power, Information Technology &

Communications, Collaborative R&D, Exports, Shipping, Training & Consultancy,

Engineering & Construction, and Transnational Operations. Twelve joint Ventures

are now operational in partnership with some of the leading international and

Indian companies;


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Avi-Oil (India) Pvt. Ltd. With NYCOSA, France, and Balmer Lawrie & Co.

for manufacturing and marketing Defence and civil aviation lubricants and

specialties.

The cover depicts a bird, symbolizing IndianOil, breaking through barriers

to seek new horizons.

It is a quest marked by immense possibilities a quest for progress through

pursuit of new opportunities.

The colour blue signifies the vast expanse of a new world, and is a tangible

expression of widening horizons.

Indian Oiltanking Ltd., with Oiltanking (India) GmbH, Germany, for

infrastructure development and terminalling services.

Petronet India Ltd. (PIL), a consortium of oil companies and financial

institutions, for petroleum product pipeline projects.

Petronet Vadinar-Kandla Ltd., as a subsidiary of PIL, for Vadinar-Kandla

product pipeline.

Petronet Chennai-Trichy-Madurai Ltd., also as a subsidiary of PIL, for

Chennai-Trichy-Madurai product pipeline.

IndianOil is marketing diesel fuel additives for automobiles in collaboration with

Elf Antar, France.

IndianOil Air BP are collaborating in aviation fueling business.

IndianOils investments in creation of assets will exceed Rs. 40,000/- Crore over

the decade beginning 1997. These investments, substantially funded from internal

resources, will result in expansion and modernisation of existing capacities, as well

as creation of state-of-the-art facilities.


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IndianOil is an academy company with 18training centers. The IndianOil

Institute of Petroleum Management (IIPM), Gurgaon, serves as an apex training

and consultancy institute and conducts management development programmes in

association with reputed national and international institutes.

IndianOil Management Centre for Learning (IMCL) recently set up in Mumbai

will facilitate in upgrading the functional knowledge and skills of the employees

and also impart behavioural training.

For the past two decades, IndianOil has been lending its expertise to several

countries in areas of refining, marketing, transportation, training and R&D. Theseinclude Sri Lanka, Kuwait, Bahrain, Iraq, AbuDhabi, Tanzania, Ethiopias, Algeria,

Nigeria, Nepal, Bhutan, Maldives, Malaysia and Zambia.

IndianOils commitment to quality, safety, health and environment is reflected in

the series of national and international certifications and awards earned over the

years.

The 17th largest petroleum company in the world, IndianOil, is now emerging as a

transnational energy conglomerate. From the icy slopes of Leh in the Himalayas to

Kanyakumari where the Bays of Bengal and the Arabian Sea join the Indian

Ocean, and from the Single Buoy Mooring at Salaya in the West to the

Monasteries at Tawang in the East, IndianOil lives in every heart and in every part

of India.


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GLOBAL RANKING

Indian Oil Corporation maintained its position as the sole Indian presence in the

Fortune Global 500 listing of the worlds largest corporations for the eighth year

in succession. In the latest ranking released by the Fortune magazine for the year

2001, Indian Oil Corporation is ranked 226 against the ranking of 209 last year.

The lower ranking is mainly due to the diminished value of Rupee as compared to

the US $ by 5.65% for the period under review. As per the Fortune listing, amongst

the 269 largest petroleum-refining companies in the world, IndianOil is ranked 17,

a step above last years position of 18.

In the list of Forbes International 500 Companies outside the US, IndianOil

retains its last year ranking of 112, and tops the list among the four Indian

corporates appearing in the listing.

In addition to the Fortune and Forbes rankings, Indian Oil Corporation has been

ranked First in Petroleum Trading among the 15 National Oil Companies in the

Asia Pacific Region in the 2001 Industry Perception Survey conducted by Applied

Trading Systems, Singapore.

FINANCIAL REVIEW

TURNOVER

The turnover of Indian Oil Corporation for the year ended 31.03.2002 was Rs.

114,864 Crore as compared to Rs. 117,371 Crore in the previous year. The

reduction in turnover is mainly on account of reduced sale of crude and product to

other Oil Marketing Companies.


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Further, the inland sales volume reduced by 0.63 million metric tones, from 47.80

million metric tones in 2000-01 to 47.17 million metric tones during 2001-02,

registering a decline of 1.32%. The reduction in sales is mainly due to lower off-

take of HSD, SKO and Naptha consequent to slow down of economy.

PROFIT BEFORE TAX

The Corporation recorded the highest ever Profit Before Tax of Rs. 4,599 Crore

during the current year as against Rs. 2,962 Crore in 2000-01, registering a growth

of 55%. The increase in Profit Before Tax is mainly on account of settlement of

Pool claims pertaining to previous year.

PROVISION FOR TAXATION

a) Current Tax

An amount of Rs. 977 Crore has been provided towards Current Tax considering

the applicable Income Tax rates, as against Rs. 242 Crore provided during 2000-

01. The effective tax rate for the current financial year works out to 21.68% as

against 8.18% in 2000-01. The increase in effective tax rate is due to provision of

tax during the current year at normal rates of tax due to higher profits as compared

to provision at MAT (Minimum Alternative Tax) rate in the previous year.

b) Deferred Tax

In compliance of Accounting Standard-22 on Accounting for Taxes on Income

issued by The Institute of Chartered Accountants of India, the Corporation has

(i) Provided accumulated Deferred Tax Liability as on 01.04.2001 amounting to

Rs. 2,688 Crore with a corresponding charge to General Reserve having no impact


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on current year profits.

(ii) Provided Deferred Tax Liability for financial year ended 31.03.2002

amounting to Rs. 717 Crore and accordingly Profit has been reduced by the same

amount.

PROFIT AFTER TAX

Profit After Tax has improved from Rs. 2,720 Crore in 2000-01 to Rs. 2,885 Crore

during current financial year, registering a growth of 6%.

DEPRECIATION

Consequent to increased capitalization of fixed assets, deprecation for the year

2001-02 was Rs. 1,392 Crore as against Rs. 1,224 Crore for the year 2001-02.

INTEREST (NET)

Interest Expenditure (net) decreased from Rs. 1,174 Crore during 2000-01 to Rs.

882 Crore for the current year. The decrease is mainly due to reduction in short

term loans and decrease in overall cost of borrowings.

BORROWINGS

The borrowings of the Indian Oil Corporation have also reduced from Rs. 20,636

Crore as on 31.03.2001 to Rs. 19,070 Crore as on 31.03.2002. The Total Debt to

Equity ratio as on 31.03.2002 works out to 1.25:1 as against 1.29:1 as on

31.03.2001 and long Term Debt to Equity ratio stands at 0048:1 as on 31.03.2002

as against.0.40:1 as on 31.03.2001.


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Outlets and 19 SKO / LDO Dealerships during the year, raising their total number

to 7,870 and 3,455 respectively. This includes 80 jubilee Retail Outlets.

CUSTOMER SERVICE

In Indian Oil Corporations pursuit to provide better services, IVSR based

complaint tracking and redressal system for customers was launched in 33 Indane

Area Offices. Further, in order to provide value added services to monitoring

public, Indian Oil Corporation, in association with State Bank of India, launched

the SBI-Indian Oil Co-branded pre-paid card called Smart Gold for customers to

avail of products and services at IndianOil retail outlets. Indian Oil Corporationintroduced 35 ATMs at retail outlets during the year in various parts of the country,

thereby bringing the total number of ATMs installed to 57. The IndianOil-

Citibank co-branded credit card has reached a membership of 1.48 lakh as on

31.03.2002.

Indian Oil Corporation, in association with Chennai based Sundaram Finance ltd.,

also launched Power Plus Fleet Card for transport fleet operators.

INDANE COOKING GAS

During the year, Indian Oil Corporation enrolled 26 lakh Indane customers, and the

cumulative Indane consumer population reached 322 lakh.

The number of Indane distributorships commissioned during the year was 457

raising the total number of distributors to 3,881. During the year, seven new Indane

Bottling Plants were commissioned, thus raising the total number of Indane

Bottling Plants to 78 and the total bottling capacity to 32.21 metric tones per

annum.


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AVIATION

Indian Oil Corporation continued to be market leader in Aviation Fuel supply

business with a market share of 67.9%. The entire Aviation Fuel requirements of

Indian Navy and Indian Army, and over 87% requirement of Indian Air Force was

met by IOCL. The major requirements of other market segments like Indian

Airlines were catered to by Indian Oil Corporation. IOCL commissioned a state-of-

the-art Hydrant Refuelling System at Netaji Subhas Chandra Bose Airport in

Kolkata during the year for use of Industry. As part of customer service initiatives

Indian Oil Corporation has developed a user-friendly IndianOil Aviation web pageon Internet, providing information on ruling prices, service network, aviation

highlights, and information on products available location-wise.

Indian Oil Corporation organized the 11th International Aviation Conference at

Hyderabad, which was attended by representative of major international airlines,

IATA, aviation equipment manufactures and Government.

LUBRICANTS

Indian Oil Corporation produced 3.96 lakh metric tones of lubes and 0.13 lakh

tonne of grease during the year. In spite of depressed market conditions, Indian Oil

Corporation improved its market share in finished lubricants. 36 R bazaar-on-

wheels were added to penetrate the bazaar trade. 24 R stockists (auto) and 11 R

stockists (industrial) were commissioned during the year to give a thrust to

lubricant sales. During the year, R lubricants were launched in Bangladesh and Sri

Lanka.


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SPECIALITIES

Indian Oil Corporation introduced four new products, viz., Needle Coke (Guwahati

Refinery), Microcrystalline Wax (Haldia Refinery), and Polymer Grade Hexane

and Butene-2 (Gujarat Refinery) in the market as import substitutes.

SHIPPING

149 product import tankers, 11 product tankers and 444 crude import tankers were

handled during the year.

QUALITY ASSURANCE

IOCL consistently accorded top priority on Quality Assurance for its products and

services. IndianOil continues to be the market leader for testing petroleums

products by providing the largest network of testing facilities. More than 2 lakh

samples were tested in its 37 laboratories located across the country. During the

year, a mobile laboratory was added at Patna, taking the number of mobilelaboratories to 23. Laboratory Information Management System was successfully

commissioned in a few IndianOil laboratories with the Laboratory Documentation

and Management System software developed by the Quality Control Department

of Marketing Division.

INTERNATIONAL TRADE

Indian Oil Corporation arranged import of crude oil, petroleum products and

lubricants for meeting the countrys requirements through a carefully selected

diversified mix of supply sources and also exported petroleum products during


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2001-02 as detailed hereunder:

Quantity(MMT) Value (Rs. Crore)Imports

Crude Oil - 47.98 38,910.15

Petroleum Products, including for

Nepal Oil Corporation 2.282,506.80

Lube Base Oils / Lubricants / Additives 0.02 51.30

Exports

Petroleum Products 0.21 203.41

Lubricants 1,382 MT 4.28

Bitumen 2,574 MT 2.09

RESEARCH & DEVELOPMENT

During 2001-02, Indian Oil Corporations R&D Centre focused on

commercializations of already developed technologies, development of innovative

and cost-effective technologies with reduced gestation period, and specialized

technical services to operating divisions of the Corporation. During 2001-02,

IndianOils R&D Centre developed 80 formulations, which include 42 new

product formulations: 32 product formulations got approval from various national

and international original equipment manufacturers and 14 products got American

Petroleum Institute (API) certification while field trials on 12 new products were

conducted. Intellectual Property Rights activities of the R&D Centre led to grant of19 patents, including 10 Indian, seven US, One Canadian and one European. 11

new patents were field, which include four in India, three in US and one each in

Europe, China and Brazil.


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The efforts of the R&D Centre in proprietary additive development resulted in the

synthesis of an EP Additive and Friction Modifier and its production on

commercial scale at Taloja Additive Complex in Maharashtra. The Oilivorous-S

Technology developed jointly with Tata Energy Research Institute for safe

disposal of oil sludge has been put on field trial at Barauni and Mathura refineries.

A multi-functional additive for MS was developed for improving the quality of

fuel. Another breakthrough was the development of a process to improve

deodorisation and dry point of MTO at Panipat Refinery. As further advancement

in Bitumen technology, a high performance binder known as Crumb RubberModified Bitumen was developed and commercialized.

In refining technology, technologies developed earlier have moved up on the

commercialization process chain during the year. These include INDALIN Process

for conversion of olefinic petroleum fractions into LPG and aromatics, LOTUS-24,

which is under field trial at Mathura Refinery, and IMAX Additive for

maximization of LPG yield, plant trial for which has been completed at Gujarat

Refinery. Other breakthroughs include development of LPG-MAX, a new process

for LPG maximization and continuous film contractor based process for removal of

Mercaptan from LPG.

The Instrumented Pig developed jointly by R&D Centre and Bhaba Atomic

Research Centre, Mumbai, has completed field trials and is ready for

commercialization.


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INFORMATION SYSTEMS

Indian Oil Corporation aims at maintaining its leadership in the Indian

hydrocarbon industry by assimilation of emerging Information Technology and

web-enabled business solutions for integrating and optimizing the Corporations

hydrocarbon supply chain. Indian Oil Corporation is focusing on total customer

delight through value-added IT solutions, with emphasis on centralized control and

decentralized response.

PROJECT MANTHAN

As part of the on-going ERP (Enterprise Resource Planning) implementation

across the corporation under Project Manthan, 12 units have gone live on the latest,

state-of-the-art SAP r/3 software system on New Year Day (01.01.2002) and three

more on 01.07.2002, without any disruption in operations at any of the units.

Earlier, Indian Oil Corporations R&D Centre at Faridabad became the maiden

unit to Golive on SAP in August 2001, followed by IndianOil Institute of

Petroleum Management (IIPM) at Gurgaon in October 2001.

The laboratory Information Management System package was also implemented

at Panipat Refinery in March 2001 and at R&D Centre in August 2001.

A-30 A-31 Construction of the Data Communication Centre, the electronic and

communication hub of the project, at IIPM campus is in progress. It will not only

host SAP Production System (including Database Servers, Application Servers and

Storage Libraries) but also form the nucleus of a wide Area Network linking all

locations of Indian Oil Corporation through an extensive and robust

communication network using V-SATs, leased lines, ISDN / PSTN dial-up lines,


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radio / wireless links and the Optical Fibre Cable communication system of

Pipelines Division.

Project Manthan is also in an advanced stage of customizing Add-On software

packages in core business areas like demand forecasting; crude allocation to

refineries, distribution planning for finished products; transportation scheduling;

optimizing refinery operations and product mix solutions; and planning; optimizing

and scheduling of the Corporations profitable lubricants business.

HUMAN RESOURCES

EMPLOYEE PROFILE

The human resources in Indian Oil Corporation was 31,675 strong as on

31.03.2002, of which 9,728 are in the Officers cadre and 21,947 are in the Staff

cadre. There are 5,672 employees from SC category and 2,097 from ST category.

The SC and ST employees constitute 24.53% of the total employees strength.

There are 2,387 women employees, out of whom 692 are in the Officers carde and

1,695 in Staff cadre. The women employees constitute 7.54% of total employees

strength.

WELFARE OF EMPLOYEES

IndianOil Corporation continued its endeavour to upgrade facilities and promote

the welfare of employees. With a view to promote employees welfare, Indian Oil

Corporation brought about improvements in policies concerning medical facilities,

allowances at remote locations, Productivity Incentive Scheme and post-retirement

medical facilities.


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WELFARE OF WEAKER SECTIONS

Indian Oil Corporation has been diligently following the Presidential Directives

and various instructions / guidelines issued by the Government of India regarding

reservation in Services for SCs / STs/ OBCs/ Physically Handicapped/ Ex-

servicemen, etc. Sincere efforts have been made to recruit reserved category

candidates as per the Governments instructions. It has been the endeavour of your

Corporation to utilise 25% of Community Development Funds towards Special

Component Plan (SCP) and Tribal Sub Plan (TSP) for meeting the needs of weaker

sections. Status on Implementation of Disabilities Act, 1995 Before the enactmentof the Act, Indian Oil Corporation had been extending reservation for physically

handicapped persons in recruitment to the posts in Group C & D. With the

enactment of the act, w.e.f. 07.02.1996, the reservation for physically handicapped

persons has been extended to the posts in Group A & B as well. Indian Oil

Corporation has been implementing the provision of 3% reservations for physically

handicapped and disabled persons in letter and spirit. Besides, various concessions

and relaxataions are being extended to physically handicapped persons in

recruitment. Presidential Directives regarding Representation of SCs and STs

Officials dealing with the subject are given training as required so as to enable

them to update their knowledge on the subject and perform their job effectively.

Liaison Officers have been appointed at various locations/ units/ installations all

over the country to ensure implementation of Government Directives.


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In accordance with para-29 of the Draft Presidential Directives, a note about the

Corporations activities having direct relevance to advancement of SC / ST

category of employees along with statistics relating to presentation of SCs / STs, in

the prescribed proformae Appendices VII(A) and VII(B) is placed as

Annexure-2. In accordance with the revised instructions of the Government of

India.

THE INDIAN OIL FOUNDATION

As part of the Corporate Mission to help enrich the quality of life of the

community and preserve ecological balance and heritage, Indian Oil

Corporation has set up The IndianOil Foundation as a non-profit Trust to protect,

preserve and promote our national heritage and culture, in collaboration with the

Archaeological Survey of India and the National Culture Fund of the Ministry of

Culture.

The Indian Oil Foundation will adopt at least one heritage site in every State and

Union Territory. Archaeological works will be funded by the IndianOil Foundation

to the Archaeological Survey of India through the National Culture Fund. Five

prestigious sites have been identified, viz., Qutb Minar, Delhi; Khajuraho, Madhya

Pradesh; Hampi, Karnataka; Kanheri Caves, Maharashtra; and Konarak, Orissa.

The IndianOil Foundation will develop world-class facilities and conveniences for

visitors. Indian Oil Corporation will provide refueling facilities for travelers and

also undertake community development in the neighborhood.


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IOBL earned a Net Profit of Rs. 6.86 Crore and declared a Dividend of 30% for the

year 2001-02. The production for the year 2001-02 was 226 TMT, attaining a

capacity utilization of 95%.

CHENNAI PETROLEUM CORPN. LTD.

The annual Accounts and Directors Report of Chennai Petroleum Corporation

Ltd. (CPCL), a subsidiary of the Corporation, are annexed. CPCL earned a Net

Profit of Rs. 63.71 Crore on a Turnover of Rs. 6,175 Crore and declared a

Dividend of 20% for the year 2001-02.

BONGAIGAON REFINERY & PETROCHEM

The Annual Accounts and Inrectors Report of Bongaigaon Refinery &

Petrochemicals Ltd. (BRPL), a subsidiary of the Corporation, are annexed. BRPL

incurred a loss of Rs. 198.61 Crore on a Turnover of Rs. 1,195 Crore during the

year 2001-02.

IBP Co. LIMITED

The Annual Accounts and Directors Report of IBP Co. Limited, a subsidiary of

the Corporation, are annexured. IBP Co. Limited earned a Net Profit of Rs. 195.79

Crore on a turnover of Rs. 8,453 Crore and declared a Dividend of 100% for the

year 2001-02

.


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CONCPTUAL FRAMEWORK OF WORKING CAPITAL:

Working Capital sometimes called as Net Working Capital is represented by the excess of

current assets over the current liabilities and identified the relatively liquid portion to total

enterprise capital which constitutes a margin of buffer for maturing obligations within the

ordinary operating cycle of the business.

'Working Capital is a excess of current assets over current liabilities'.

CONCEPT OF WORKIGN CAPITAL:

There are two concepts of working capital such as

Gross Concept

Net Concept

GROSS WORKING CAPITAL: (GWC)

The gross working capital simply called as working capital, refers to the firm's investment

in current assets. Current assets are the assets which can be converted into cash within an

accounting year (or operating cycle) and include cash, short-term securities, debtors, bills

receivables, inventories and prepaid expenses.

Gross Working Capital = Total of Current Assets


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WORKING CAPITAL:

The term working capital refers to the capital required for day to day

operations of a business enterprise. It is represented by excess of current assets,

over Current liabilities. It is necessary for any organization to run successfully its

affairs ,to provide for adequate working capital.

ADVANTAGES OF ADEQUATE WORKING CAPITAL

Working capital is the lifeblood and nerve center of business. Just as

circulations of blood is essential in the human body for maintaining life,working

capital is very essential to maintain the smooth running of abusiness. No business

can run successfully without an adequate amount of working capital. The main

advantages of maintaining adequateamount of working capital are as follows:

1. Solvency of the business: Adequate working capital helps inmaintaining

solvency of the business by providing uninterrupted flow of production.

2. Goodwill: sufficient working capital enables a business concern to Make

prompt payments and hence helps in creating and maintaining Goodwill.


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3. Easy loans: a concern hacking adequate working capital, high Solvency and

good credit standing can arrange loans from banks and others on easy and

favorable terms.

4. Cash Discounts: Adequate working capital also enables a concern to avail cash

discounts on the purchases and hence it reduces costs.

5. Regular payments: Regular payments of salaries, wages and other day- To-day

commitments company, which has sample working capital, can make regular

payment of salaries. Wages and other day-to-day commitments. Which raise the

morale of its employees, increase their Efficiency, reduce wastage's and costs and

enhances production and profits.

6. Regular supply of raw materials: Sufficient working capital ensures regular

supply of raw materials and continues production.

7. Ability to face Crisis: Adequate working capital enables a concern to face

business crisis in emergencies such depression because during such periods.

Generally, there is much pressure on working capital.

8. Quick and Regular return on Investments: Every investor wants a quick

and regular return on investments. Sufficient of working capital enables a

concern to pay quick and regular dividends to its investors, as their may not


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be much pressure to plough back profits. this gains the confidence of its

investors and creates a favorable market to raise additional funds in the

future.

9. High morale: Adequacy of working capital creates an environment of

security, confidence and high morale creates over all efficiency in a

business.

DISADVANTAGES OF EXCESSIVE WORKING CAPITAL:

Every business concern should have adequate working capital to run its

business operations. it should have neither redundant or excessive working capital

nor inadequate shortage of working capital. Both excessive as well as short

working capital positions are bad for any business.

1. Excessive working capital means idle funds which earn no profits for the

business and hence the business cannot earn a proper rate of return on its

investments.


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2.

3. When there is redudant working capital,it may lead to unnecessary

purchesing and accumulation of inventories casuing more chances of theft

waste and losses.

4. Excessive working capital implies excessive debtors and defective credit

policy, which may it may cause higher incidence of bad debts.

It may result into overall inefficiency in the organization.

When there is an excesses working capital relation with the banks

and other financial institutions may not be rnaintained.

Due to low rate of return on investments the value of shares may also fall.

DISADVANTAGES OF INADEQUATE WORKING CAPITAL

1. A concern, which has inadequate working capital, cannot pay its short term

liabilities in time. Thus it will loose its reputation and shall not be able to get

good credit facilities.

2. It cannot buy its requirements in bulk can cannot avail of discounts etc.

3. It becomes difficult for the firm to exploit favorable market conditions and

undertaken profitable due to lack of working capital.


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By neglecting this, many ventures run into financial difficulties in their early

operating years, the rather casual approach to assessment of working capital needs

during the periods when industry and business functioned in a sellers market could

be understand as at the banker was willing to absorb all shock of fluctuations in

project operations by providing ready funds to meet emergency needs. The

position has undergone radical change. The banker can no longer be taken for

granted and in the absence oil proper estimation of working capital needs, the

project may have to face serious financial problems.

2. Position of Business Cycle:

Movements of the business cycle bring about shifts in working capital

position. The upward wing is associated with spurt in sales and increase in levels

of inventories and book debts. There could be a cash shortage and borrowing may

become necessary. On he other hand, when there is a downswing, the level of

inventories and book debts may fall, but revenues also fall, while certain categories

of costs remain fixed and cash shortage right still be felt.

3. Nature of Business:

The nature of business has an important bearing on its working capital

needs, some ventures like retail stores, construction companies etc. require an

abundance of working capital.


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In other cases such as power generations and supply, the current assets playa minor

and secondary role.

4. The manufacturing cycle:

A longer manufacturing cycle between the raw material purchase and the

completion of he manufacturing process will obviously mean larger tie up of funds

to meet increased working capital needs. In such cases management should try to

increase the rate of production and reduce the cycle time and thus cut down

working capital requirement. This can be achieved through process changes or

through effective organization and coordination at all levels of enterprise activity.

Frequent changes in setups, waiting for materials, tools or instructions and

accumulations of working progress result in extending the time cycle and blocking

more funds. Organized negotiations with suppliers for attractive credit terms and

retention of their continued confidence by the settlement of bills on agreed dated

can also help reduce working capital requirements.

5. Credit Terms to Customers:

The credit terms to customers influence the working capital level by

determining the level of investment in book debts. Management has to decide on

suitable credit policy relevant to each customer based on the merits of his case.


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Unduly liable credit policies and permissive attitude in the matter of collections of

outstanding can lock up funds that would be other wise be available for operating

needs.

6. Vagaries in supply of Raw Materials:

The sources of certain raw materials are few and irregular and pore problems

in the matter of procurement and holding, using up more funds. Materials that are

available only in certain seasons have to be obtained and stored in advance. The

working capital requirements in such instances will show seasonal fluctuations.

7. Shifts in Demand for Products:

Some manufactured products are subject to seasonal fluctuations in sales. In

order to utilize the capacity to the maximum possible extent, steady production

may have to be maintained, through the demand for finished products may very

from time to time. Finished goods inventories will therefore accumulate during off

season, requiring increased amounts of working capital to support higher levels of

inventory. Financial planning will have to provide for these funds, requirements

associated with steady, production and seasonal sales.


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8. Production Polices:

To tackle the problem of having to find funds to support the increasing

finished goods inventory levels until they are sold during the peak seasons, some

companies diversify and produce other products that are in demand, enabling

manufacture of the main product to follow the seasonal pattern of its demand.

9. Competitive Conditions:

In a competitive market, winnings and maintaining customers goodwill will

involve additional costs and present a variety of working capital problems.

To offer the customer the benefit of choice, a variety of products will have to

be manufactured and stocked. This would mean higher levels of inventories in all

stages and, therefore, additional working capital funds. More generous credit

terms may have to be extended and the investments in accounts receivables may

have to be higher, requiring additional funds. The degree of completion is thus an

important factor influencing working capital requirements.

10. Growth and Expansion Programs:

As business grows, additional working capital has to be found. In fact, the

need for increased working capital does not follow the growth in business activity,

but preceded it.


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Advance planning of working capital is thus a continuing necessity for

Owning concern. Or else, the company may have substantial earnings but little

cash. With fast growth, they may be under constant pressure for raising external

funds in addition to the internal generation. Forward planning and continuous

review, therefore, are very essential for such companies.

11. Profit Levels:

By the very nature of things, some enterprises generate high margins

compared to others. The product category and the firms position in the market

may have given these advantages. Others have to struggle in a highly competitive

environment. But, profits cannot be considered as available cash at the end of the

period. Even as the companies operations are in progress, cash is used up for

augmenting stocks, book debts and fixed assets. Elaborate planning and

projections of expected activities and cash flows, at short intervals, assume

importance. To meet anticipated deficits, sources of funds will have to be

identified and where surpluses are expected, suitable applications will have to be

planned.

12. Taxation:

Tax liability is an inescapable element in working capital planning. It is a

short term liability payable in cash.


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Advance taxes may have to be remitted in installments, on the basis of estimated

profits. Periods of high taxation impose additional strain on working capital.

To able to get the best out of the available tax incentives, the finance manager has

to draw up the operating plans of the company in advance and utilize the resources

for research and development, exports or other purposes which promise tax

benefits and promote the companies earnings.

13. Dividend Policy:

Management has to preserve cash resources but at the same time, it a cannot

fail to satisfy investor expectations. Market prestige for the shares of the company

has also lobe nurtured and maintained in its long run interests. During periods of

low profits, maintenances of steady dividends will involve draining of resources

but may be needed to preserve the companies Image.

14. Reserves Policy:

One of the cherished goal of enterprise management is to build up adequate

reserves out of profits the urge to retain profits may act as a major constraint on the

dividend policy, the funds position being given higher priority over dividend

policy.


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15. Depreciation Policy:

Depreciation policy determines he amount to be provided as, depreciation on the

various categories of fixed assets. The depreciation charges do not involve any

cash outflow. Enhanced rated of depreciation have the effect of reducing profits

correspondingly, which in turn can help in holding back distribution of dividends.

This process conserves cash. Depreciation polices. Thus exert influence on the

status of working capital in the enterprises from time to time.

16. Price Level Changes:

Rapidly rising prices create the need for more funds for maintaining the

present volume of activity for same levels of inventories, higher cash outlays are

needed.

In an inflationary set up, even operating expenses will grow for given levels

of activity. Some companies may be able to compensate part of these cost

increases through increases in prices for their products.

The implications of changing price levels on working capital position will

vary from company to company depending on the nature of the company.

17. Operating Efficiency:


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WORKING CAPITAL MANAGEMENT:

Working capital management involves the relationship between firm's short-

term assets and its short-term liabilities. The goal of working capital management

is to ensure that a firm is able to continue its operations and that it has sufficient

ability to satisfy both maturing short-term debt and up coming operational

expenses.

The management of working capital involves managing inventories,

accounts receivable and payable and cash.

Why firms hold cash:

The finance profession recognizes the three primary reasons offered by

economist JOHN Maynard Keynes to explain why firms hold cash. The three

reasons are for the purpose of speculation, for the purpose of precaution, and for

making transactions. All three of these reasons from the need for companies to

process liquidity.

CONCEPTS OF WORKING CAPITAL:

There are two concepts of working capital:


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(i) Gross working capital

(ii) Net working capita

In the broad sense, the term working capital refers to the gross working

capital and represents the amount of funds invested in current assets. Current assets

are those assets, which in the ordinary course of business can be converted into

cash within a short period if normally one accounting year.

In a narrow sense, the term working capital refers to the net working capital.

Net working capital is the excess of current assets over current liabilities.

Net working capital may be positive or negative. When the current assets

exceed the current liabilities, the working capital is positive and the negative

working capital results when the current liabilities are more than the current assets.

The Gross working capital concept in financial or going concern concept

whereas net working capital is an accounting concept of working capital. These

two concepts of working capital are not exclusive; rather both have their own

merits.

Working Capital = Current Assets Current Liabilities


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Gross concept is very suitable to the company form of organization where

there is divorce between ownership, management and control. The net concept may

be suitable only for proprietary form of organization such as sole-trader or

partnership firms. However, it may be made clear that as per the general net

working capital is referred to simply as working capital.

TYPE OF WORKING CAPITAL

There are varying concepts or perceptions of working capital, which haverelevance to specific situations.

KINDS OF WORKING CAPITAL

WORKING CAPITAL

On the basis of Concept On the Basis of Time

Gross Net Permanent (or) Fixed Temporary(or)

Working Capital Working Capital working capitalvariable

Working capital

Regular ReserveWorking capital Working capital

Seasonal specialWorking Capital Working Capital


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1. GROSS WORKING CAPITAL:

Gross working capital is represents by the sum total of all current assets of

the enterprise. Enough funds will have to be provided to sustain the movement of

raw materials through the work.

But short term financing is more risky than long term financing. In process

to the finished goods stage and then to accounts receivables and up to the

realization of cash.

In other words, the funds needed would total up to the constituent

components, namely stock of raw materials and minimal cash and bank balances,

constituting working capital. In managing gross working capital, the shifts in

investment in current assets are under constant review, close attention and prompt

correction. Excessive investment in current assets is to be carefully avoided, as

otherwise profits would be adversely affected.

2. NET WORKING CAPITAL:

Net working capital is the difference between the current assets and current

liabilities. While current assets are short term assets that are expected to get

converted in to cash within one year, current liabilities are short term liabilities

that are expect to fall due or mature for payment in a short period, generally within

a year, and represent short term sources of funds. The concept of net working


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capital, as the excess of current assets over current liabilities, highlights the

character of he sources from which the funds have been obtained to support that

portion of current assets in excess of current liabilities. This part of working

capital may be provided by way of share capital, from internal source such as

reserves or plough back of profits or from external sources in the form of long-

term borrowings. There are two implications.

The management has to examine what proportion of the current assets has

to be financed by permanent capital and long-term borrowings. Then there is the

eagerness of short term creditors to verify whether the total current assets,

representing ultimate source of funds for the recovery of their dues, maintains a

convincing level above the total current liabilities or obligations. A judicious

policy of mixing long term and permanent as distinct from short term sources

should be formulate to finance investment in current assets.

3. PERMANENT WORKING CAPITAL:

In actual operation of typical going concern, the current assets and each

component of it, are subject to continuous and rapid pace of replacement. Over a

period of time, there is a constant or minimum level, below, which the total

investment in current assets does not fall.

This minimum level of current assets can be called as the hared core or fixed or

constant or permanent working capital and should normally be financed by long


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term debt and equity. Recognizing this, the matching principle of financing is

interpreted to indicate that the fixed assets and permanent working capital should

be financed by long term sources of funds and that the variable working capital

should be financed with sort term sources of funds.

4. VARIABLE WORKING CAPITAL:

Seasonal fluctuations in a business are a common features n many cases.

The amount of funds needed over and above the fixed working capital to take care

of such seasonal shifts constitutes the variable working capital. These are also

referred to as fluctuating temporary working capital and may be financed by short

term sources of appropriate amount and duration. In fact, in would be wise to

cover also a part of this seasonal requirement form long term sources, as insurance

against unexpected shifts in case flows.


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Cash flows in a cycle into, around and out of a business. It is the business's

lifeblood and every manager's primary task is to help keep it, flowing and to use

the cash flow to generate profits. If a business is operating profitably, then it

should, in theory, generate cash surpluses. If it doesn't generate surpluses, the

business will eventually run out or cash and expire.

The faster a business expands the more cash it will need for working capital

and investment. The cheapest and best sources of cash exist as working capital

right within business.

Good management of working capital will generate cash will help improve

profits and reduce risks. Bear in mind that the cost of providing credit to customers

and holding stocks can represent a substantial proportion of a firm's total profits.

There are two elements in the business cycle that absorb cash inventory

(stocks and work-in -progress) and Receivables (debtors owing you money).The

main sources of cash payables (your creditors) and Equity and Loans.

Each component of working capital (namely inventory, receivables and

payables) has to dimensions ....TIME.....And MONEY. When it comes to

managing working capital -TIME IS MONEY. If you can get money to move

faster around the cycle (e.g. collect monics due from debtors more quickly) or

reduce the amount of money tied up (e.g. reduce inventory levels relative to sales).


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If you... Then.....

Collect receivables (debtors)faster

Collect receivables (debtors)

shower

Get better credit (in term of

duration or amount) from suppliers

Shift inventory(stocks) faster

Move inventory (stocks)

slower

You release cash from thecycle

Your receivables soak up cash

You increase your cash

resources

You free up cash

You consume more cash

It can be tempting to pay cash, if available, for fixed assets e.g. computers ,

plants, vehicles etc. if you do pay cash, remember that this is now longer available

for working capital.Therfore,if cash is tight consider other ways of financing

capital investment-loans,equity,leasing etc. similarly, if you pay dividends or

increase drawings, these are cash outflows and, like water flowing down a

plughole, they remove liquidity from the business.


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More business fail for lack of cash than for want of profit. The third area in the

account receivable management is collection policies.

These policies cover two aspects.

. Degree of effect to collect overdue

. Type of collection effects

THE OPERATING CYCLE:

The operating cycle of the company can be said to cover distinct stage, each

stage requiring a level of supporting investment. The sum total of these stage-wise

investments will be the total amount of working capital required.

The operating cycle has four stages:

a. The raw materials and stores inventory stage.

b. The work-in-progress stage

c. The finished goods inventory stage

d. The book debts or accounts receivable stage.

The level of investments in raw materials and stores inventory can be

expressed in term of the number of days materials and stores consumption, on an

average, held in inventory. The work-in-progress can be stated as representing a

certain number of days have cost of production. The finished goods inventory can

be expressed an equivalent to a given number of days cost of sales, on an average.

The number of days purchases on an average, included in the trade creditors can

also be calculated form the companys data. The fact that the trade creditors


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The average inventory or accounts receivable level can be arrived at by

finding the mean between the opening and closing balances for the year. The

average consumption or output or cost of sakes or sales per day can be obtained by

dividing the respective annual figures by 365.

The total operating cycle time, expressed in number of days, can at best give

a very general idea of the time interval for initial cash outlay on purchases to get

converted into cash again after passing through production, sales and collection

processes. But, the information pertaining to each distinct stage of the operating

cycle, stated in number of days relevant activity, has considerable significance, in

that it can be used, directly or with modifications, in arriving at the money values

will represent the estimated working capital requirements. Such an estimate can

only indicate the magnitude of working capital needs, on an average. The short

run fluctuations attributable to seasonal and other factors and their impact on funds

requirements cannot be spelt out by the above blanket approach to assessment of

working capital needs. To get at these specifics, Short run forecasts and budgets

have to be resorted to involving more elaborate and searching exercises, on

accounting basis.


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One of the main tasks of financial management is to hold and maintain

adequate, but not excessive, cash position. Cash is an essential input companys

operations and as such it has to be available in sufficient does according to needs,

on accounting basis. Cash is also the major out put or result of the companys

operations and there is the need for effective plan to deploy this liquid resource to

utmost productive use.


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Table showing the working capital for the year 31-03-2005 to 31-03-2006

(Rs.in Lakhs)

Particulars YEAR Changes in working capital

Increase Decrease

2005 2006

Current Assets

Inventories

453.08

367.11

0.0085.97

Sundry Debtors 330.89 137.23 0.00 193.66

Cash and bank balances 1399.46 3191.94 1792.48 0.00

Loans and advances 325.45 305.52 0.00 19.93

Total current assets (A) 2508.88 4001.8

Liabilities and

provisions

Liabilities 297.53 692.77 0.00 395.27

Provisions 495.46 284.3 211.16 0.00

Total current liabilities (B) 792.99 977.07

Net working capital

Current assets(A) -current liabilities(B) 1715.89 3024.73

Increase in working capital 1308.84 1308.84

3024.73 3024.73 2003.64 2003.64

Inference:In 2005-06 the percentage of cash and bank balance had been the highest followed by

inventory, debtors, loans and advances, to the total current asset. In this annual the period of the

company raised more cash and bank balance than actually required. From this, we can know the

other current assets declaimed too least from the total study period.


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(Rs.in Lakhs)

Particulars

YEAR Changes in working capital

Increase Decrease

2006 2007

Current Assets

Inventories367.11 532.84

165.730.00

Sundry Debtors 137.23 387.17 249.46 0.00Cash and bank balances 3191.94 4615.58 1423.64 0.00


Total current assets (A) 4001.8 5906.95 0.00

Liabilities and

provisions

Liabilities 692.77 279.29 413.48 0.00

Provisions 284.3 557.06 0.00 272.76


Net working capital

Current assets(A) -current liabilities(B) 3024.73 5070.6

Increase in working capital 2045.87

5070.6 5070.6 2318.63 2318.63



company raised more cash and bank balance than actually required. In this annual the company

decrease the credit sales and increase cash and bank balances.


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(Rs.in Lakhs)

Particulars

YEAR Changes in working capital

Increase Decrease

2007 2008

Current Assets

Inventories

532.84

534.65

1.810.00

Sundry Debtors 387.17 386.24 0.00 0.93



Total current assets (A) 5906.95 6092.56 0.00Liabilities and

provisions

Liabilities 279.49 313.04 0.00 33.75

Provisions 557.06 394.54 162.52 0.00


Net working capital

Current assets- current liabilities 5070.6 5384.98


5384.98 5384.98 349.06 349.06

Inference: In 2007-08 the percentage of cash and bank balance had been the highest followed by

inventory, debtors, loans and advances, to the total current asset. In this annual the period of thecompany raised more cash and bank balance than actually required. In this annual the company

decreases the credit sales and increase cash and bank balances.



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(Rs.in Lakhs)

Particulars

YEAR Changes in working capitalIncrease Decrease

2009 2010

Current Assets

Inventories

656.51

427.71

427.71

0.00

Sundry Debtors 495.42 291.28 291.28 0.00



Total current assets (A) 6605.63 6896.04 6896.04 0.00Liabilities and

provisions

Liabilities 620.99 429.39 429.39 307.95

Provisions 219.49 305.80 305.80

Total current liabilities (B) 840.48 735.19 735.19

Net working capital

Current assets(A) -current liabilities(B) 5765.15 6160.85 6160.85


6160.85 6160.85 6160.85 688.12



company raised more cash and bank balance than actually required. In this annual the companydecreases the credit sales and increase cash and bank balances.

FINDINGS


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SUGGESTIONS

It can be suggested that the large amount of current assets should be managed properly

As the cash and bank balance is heavy it can be suggested that they are to be utilized in

an effective manner.

Working capital in 2005-2006 was decreased but after that from 2009-10 it has been

increased tremendously. Keeping the funds ideally the company has not gone for

expansion and bought any fixed assets.

It is better to utilize funds by investing in fixed assets or going for expansion.

The company should effective measures for proper utilization of working capital, which

is more adequate to for diversification or expansion.


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BIBILOGRAPHY

K.ASWATHAPPA & K.SRIDHARA BHAT (1999). Production and operationsmanagement. Himalaya Public House, Mumbai.

I.M.PANDEY (1999), Financial Management Vikas Publishing House Pvt.Ltd. NewDelhi.

M Y KHAN & P K JAIN, Management Accounting. Tata MC Graw Hill PublishingCompany Limited, New Delhi.

R.K.SHARMA & SHASHIK GUPTA, Management Accounting Kalyani Publishing

www.spongeironindianlimited.com

rajitha(wc iocl)

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