Sagar Cement - Financial STMT Analysis

INTRODUCTION
An analysis of financial statement is important aid to financial analysis. The focus of financial analysis is on key figures in the financial statements and the significant relationship that exists between them. The analysis of a financial statement is the process of evaluating the relationship between component parts of financial statements to obtain a better understanding of the firms position and performance. However, the basic limitation of the traditional financial statements can pricing the balance sheet and the profit and loss a/c i.e. they do not give all the information related to the financial operations of a firm. Therefore, the financial statements provide a view of the financial position and operations of a firm thus. They not only indicate the present position they also indicate the causes leading up to large extent. SCOPE OF THE STUDY The study confines itself mainly to the comparitive analysis of the Balance
sheet of the overseas and presents the position of the Company. Besides this the present study will reveal the financial position of the overseas covering purely the financial data supplied in the financial statements through ratio analysis also. The data was analyzed along with the interpretations. OBJECTIVES OF THE STUDY The purpose of the study is to discover the profitability and Liquidity of the overseas to make clear the exact position and also about the industry in a systematic way. The primary objective of the study is to assist in decision making while taking decisions. Though each research study has its own specific purpose.
THE FOLLOWING ARE THE OBJECTIVES OF THE STUDY

To Know, about the SAGAR CEMENTS. To know the Long-term solvency position of SAGAR CEMENTS, through
financial statements analysis.

To know the short-term solvency position of SAGAR CEMENTS To know the profitability position of SAGAR CEMENTS, during the year 2007-
11. RESEARCH METHODOLOGY Research methodology is a way to systematically solve the research problem. It may be way to systematically solve studying how research is done scientifically. In it we study various steps that are generally adopted by a researcher in studying, but also methodology. There are mainly two types of data collection they are: Primary Data Secondary Data. I followed the data in this study is only secondary data. Which are provided by bank those are Audited Annual Reports and by using various method. SCOPE The period of the study is confined to Ten years from 2006-07 to 2010-11 because the period of Seven years considerably long to comprise all the modernized change in the Organization.
LIMITATIONS OF THE STUDY Though financial statements are relevant and useful for the concern, still they do not present a final picture of the concern. The utility of their statements is dependent upon a number of factors. The case is limited to only by following: The data has been collected through secondary source.
The time span i.e. (45 days) which has become difficult to collect all the
information. Study has been restricted only to comparative analysis. The analysis id made on the basis of data. The available data is 5 years. .
ORGANIZATION PROFILE
HISTORY OF INDIAN CEMENT INDUSTRY
By stating production in 1914 the story of story of Indian cement is a stage of continuous growth. Cement is derived from the Latin word cementam. Egyptians and Romans found the process of manufacturing cement. In England during the first century the hydraulic cement has become more versatile building material. Later on, Portland cement was invented and the invention was usually attributed to Joseph Aspdin of England. India is the worlds 4th largest cement produced after China, Japan and U.S.A. The South Industries have produced cement for the first time in 1904. The company was setup in Chennai with the installed capacity of 30 tonnes per day. Since then the cement industry has progressing leaps and bounds and evolved into the most basic and progressive industry. Till 1950 1951, the capacity of production was only 3.3 million tonnes. So far annual production and demand have been growing a pace at roughly 78 million tonnes with an installed capacity of 87 million tonnes. In the remaining two years of 8th plan an additional capacity of 23 million tonnes will actually come up. India is well endowed with cement grade limestone(90 billion tonnes) and coal(190 billion tonnes). During the nineties it had a particularly impressive expansion with growth rate of 10%. The strength and vitality of Indian Cement Industry can be gauged by the interest shown and support gives by World Bank considering the excellent performance of the industry in utilizing the loans and achieving the objectives and targets. The World Bank is examining the feasibility of providing a third line of credit for further upgrading the industry in varying areas, which will make it global. With liberalization policies of
Indian Government. The industry is posed for a high growth rates in nineties and the installed capacity is expected to cross 100 million tonnes and production 90 million tonnes by 2003 AD. The industry has fabulous scope for exporting its product to countries like the U.S.A., U.K, Bangladesh, Nepal and other several countries. But there are not enough wagons to transport cement for shipment.
Cement The product: The natural cement is obtained by burning and crushing the stones containing clayey, carbonate of lime and stone amount of carbonate of magnesia. The natural cement is brown in color and its best variety is known as ROMAN CEMENT. It sets very quickly after addition of water. It was in the eighteenth century that the most important advances in the development of cement were which finally led to the invention of Portland cement. In 1756, John Smeaton showed that hydraulic lime which can resist the action of water can be obtained nit only from hard lime stone but from a limestone which contain substantial proportion of clayey. In 1796, Joseph Parker found that modules of argillaceous limestone made excellent hydraulic cement when burned in the usual manner. After burning the product was reduced to a powder, this started the natural cement industry. The artificial cement is obtained by burning at a very high temperature a mixture of calcareous and argillaceous material. The mixture of ingredients should be intimate and they should be in correct proportion. The calcined product is known as clinker. A small quantity of gypsum is added to clinker and it is then pulverized into very fine powder, which is known as cement.
The common variety of artificial cement is known as normal setting cement or ordinary cement. A mason Joseph Aspdn of Leeds of England invented this cement in 1824. He took out a patent for this cement called it PORTLAND CEMENT because it had resemblance in its color after setting to a variety of sandstone, which is found a abundance in Portland England. The manufacture of Portland cement was started in England around 1825. Belgium and Germany started the same 1855. America started the same in 1872 and India started in 1904. The first cement factory installed in Tamilnadu in 1904 by South India limited and then onwards a number of factories manufacturing cement were started. At present there are more than 150 factories producing different types of cements. Composition of Cement: The ordinary cement contains two basic ingredients, namely, argillaceous and calcareous. In argillaceous materials the clayey predominates and in calcareous materials the calcium carbonate predominates. A good chemical analysis of ordinary cement along with desired range of ingredients.
Ingredients Lime(CaO) Silica(SiO2) Alumina(Al2O3) Calcium sulphate (CaSO4) Iron Oxide (Fe2O3) Magnesia(MgO) Sulphur (S)
Percent 62 22 5 4 3 2 1
Range 62-67 17-25 3-8 3-4 3-4 1-3 1-3
Alkalies
0.2-1
Industry Structure and Development:
With a capacity of 115 million tonnes of large cement plants, Indian Cement industry is the fourth largest in the world. However per captia consumption in our country is still at only 100Kgs of developed countries and offers significant potential for growth of cement consumption as well as addition to cement capacity. The recent economic policy announcement by the government in respect of housing, roads, power etc., will increase cement consumption.
Opportunity and threats: In view of low per captia consumption in India, there is a considerable scope for growth in cement consumption and creation of new capacities in coming years. The cement industry does not appear to have adequately exploited cement consumption in rural segment where damaged where damaged growth is possible. Landed cost of cement (with import duty)continues to be higher than home market prices but with reduced import duty, increasing imports, may pose a serious threat to the domestic cement industry. Outlook The recent change in the budget 2003- 2004 relating to fiscal incentives for individual housing and reduction in borrowing cost for this purpose and with the government reaffirmation to accelerate the reform process, infrastructure development
should logically get priority leading to increase in demand of cement in coming years. The addition capacity of cement in the pipeline is limited and therefore the demand and supply situations is expected to be more favorable and cement prices are likely to firm up. Risks and Concerns Slow down of Indian economy or drop in growth rate of agriculture may adversely affect the consumption. The recent increase in railway freight coupled with diesel / petrol price like will increase the cost of production and distribution, as being bulky, cement is freight intensive increase in Limestone royalty also adds to the cost of production, which is considerably higher than corresponding costs of many other developing countries. In our country there is a need to undertake a massive programme of house construction activity into the rural and urban areas. It is impossible to construct a house without cement and steel, in other words, cement is one of the basic construction materials and therefore it is one of the vital elements for the economic development of the nation. India inspite of being the 4th biggest producer of cement in the world has still a very low per capital consumption of cement.
Cement Companies Cement plant Installed Capacity Total Investment (approx) Total Manpower
51 Nos 99Nos 64.8mt Rs.10,000 Crores Over 1.25 Lakhs
COMPANY PROFILE
Sagar Cements is a prominent player in the field of cement in Andhra Pradesh for the past 25 Years adopting progressive manufacturing practices, whether it relates to maintaining high standards of quality of its products or development of its highly valued human resources or the need to keep the pollution to the barest minimum. The Company manufactures various varieties of cement like Ordinary Portland Cement (OPC) of 53 grade, 43 grade, Portland Pozzalona Cement (PPC) and Sulphate Resistant Cement (SRC) to suit different needs of customers and all these products are being sold under the Brand Name Sagar which has already become popular in Andhra Pradesh, has now found its acceptance among the customers in the neighboring States as well. The Company employs modern technology in each of its process of manufacture at its Plant and has adopted progressive manufacturing practices, whether it relates to maintaining high standards of quality of its products or development of its highly valued human resources or the need to keep the pollution to the barest minimum. The Company has a strong committed marketing network comprising various layers like Distributors, Dealers, C&F Agents, all of whom are served by dedicated marketing personnel. The Company has a well-designed Organizational Structure and the roles and responsibilities of each of its personnel have been well defined. The Company believes in the importance of development of Human Resources as a valuable asset and is endeavoring to enhance its value by organizing various need based in-house training programmes and encouraging their participation in the external programmes sponsored by various institutions of repute. Sagar Cements has a consistent Profit track record and, except for a few years when it was either executing its expansion plans or the industry as a whole was undergoing a difficult period, it has been declaring dividend at reasonable percentages. The companys Shares are listed on Hyderabad and Bombay Stock Exchanges, where they are actively traded. The Company which started its operation with a Cement capacity of 66000 TPA, has gradually increased it to the level of 2.35 MTPA, while its Clinker capacity has also witnessed a significant increase from 66000 TPA in 1982 to present level of 2.10 MTPA.
Vision
To provide foundations for society 's future Mission To be the India's most respected and attractive company in our industry creating value for all our stakeholders. History Sagar Cements has a rich history of providing high quality cement for more than 25 years. Starting of by being a mini cement plant , our journey started in the year 1985 and is moving into higher gears with production getting into multi million tonnes per annum.
Organisation Sagar Cements is managed by a Board, whose members are highly competent and well known. The Senior Management team consists of highly qualified Professionals with rich experience in the area of their Specialization. Group Sagar is well diversified group serving various sectors of the economy. The group constitutes of Sagar Cements Limited - Production of Cement & Clinker Sagar Power Limited - Production of Hydel Power Panchavati Polyfibers - Production of PP Fabric / Woven Sacks for Cement Industries RV Consulting - Consulting for setting Cement Plants
Sagarsoft (India) limited -www.sagarsoft.in - Software Services for global Clients Corporate Governance Sagar Cements has set itself high standards of corporate governance, ensuring responsible and transparent company management to enable its long-term success. Code of Conduct CODE OF CONDUCT AND ETHICS FOR DIRECTORS AND SENIOR MANAGEMENT TEAM Sagar Cements being committed to be a good corporate citizen conducts its business as per the applicable laws, rules, regulations and statutory guidelines as are in force and with highest standards of business ethics. It is expected of the Directors and Senior Management Team of the Company to comply with applicable laws, rules, regulations and guidelines while discharging their respective roles and to promote honesty in the process apart from abiding themselves by the policies and procedures laid down for the conduct of the business. The accounts of the Company will be maintained in a fare and accurate manner in accordance with the relevant accounting and financial reporting standards. CONFLICTS OF INTEREST A conflict situation is deemed to arise directly or indirectly when:

It is difficult to exercise an independent judgment of the company's interest; A Director or a member of the Senior Management Team accepts any personal benefits or gifts or entertainment beyond the customary level either by himself or through his family as a result of his position in the company from any person / company with which the company may have business dealings; A Director or a member of the Senior Management Team engages in any other business activity that detracts his ability to devote appropriate time and attention to his responsibilities to the company;
There exists a significant ownership interest with any supplier, customer or competitor of the company
There is any employment relationship between a Director or a member of the Senior Management Team with any supplier, customer, business associate or competitor of the company. While it is expected of a member of the Board and the Senior Management Team to avoid generally the situations where the 'conflicts of interest' can be deemed to exit, in case of unavoidable conflict of interest, he should disclose all facts and circumstances thereof to the Board of Directors or any officer nominated for this purpose by the Board and a prior written approval should be obtained. FINANCIAL REPORTING AND RECORDS As the professional and ethical conduct in the matter of financial affairs is essential for the proper functioning of the company, the officers and employees engaged in the finance functions should act with honesty and integrity. The persons in-charge of finance and accounting function should prepare and maintain companys accounts fairly and accurately in accordance with generally accepted guidelines, principles, standards, laws and regulations applicable to the company. Internal accounting and audit procedures shall fairly and accurately reflect all of the company's business transactions and disposition of assets. There shall be no willful omissions of the company transactions from the books and records. Any willful material misrepresentation or misinformation on the financial accounts and reports shall be regarded as a violation of this code. PROTECTING COMPANY ASSETS The assets of the company should not be misused but employed only for the purpose of conducting the business for which they are authorised. All Directors and members of the Senior Management Team should strive to protect company's assets and property and ensure efficient use of them. PROMOTING INTEREST OF THE COMPANY Directors and Senior Management Team owe a duty to the company to promote its legitimate interests when the opportunity to do so arises. They should not use company's property, information or position for personal gains. All Directors and Senior Management Team of the company must strive to perform their best at all times.
INTEGRITY AND HONESTY
The Directors and Senior Management Team shall act in accordance with the highest standards of personal and professional integrity, honesty and ethical conduct. They shall act and conduct free from fraud and deception. Their conduct shall conform to the professional standards of conduct. FAIR DEAL Each Director and the member of Senior Management Team should deal fairly with customers, suppliers and competitors. He should not take unfair advantage of anyone through manipulation, concealment, abuse of confidential, proprietary or trade secret, information, misrepresentation of material facts, or any other unfair practices. HEALTH, SAFETY, ENVIRONMENT AND SOCIAL RESPONSIBILITY Sagar Cements shall strive to provide a safe and healthy working environment and comply with all regulations regarding the preservation of the environment in and around its manufacturing facilities and other points of operations. The companies is committed to efficient use of natural resources and minimize any hazardous impact of the development, production, use and disposal of any of its products and services on the ecological environment. CONFIDENTIALITY The Directors and the Senior Management Team shall maintain utmost confidentiality of information or that of any customer, supplier or business associates of the company to which company has a duty to maintain confidentiality except when disclosure is authorized. The use of confidential information for his own advantage or profit is also prohibited. COMPLIANCES The Directors and the Senior Management Team shall comply with all applicable laws, rules and regulations. Transactions relating to sale or purchase of company's equity shares should not be undertaken without complying with the formalities contained in the company's code of internal procedures and conduct for prevention of insider trading. If any Director or Member of the Senior Management Team who knows of or suspects of any violation of applicable laws, rules or regulations or this Code of Conduct, he must immediately report the same to the Board of Directors or any designated person thereof. Such person should as far as possible provide the details of suspected violations with all known particulars relating to the issue. The company recognizes that resolving such problems or concerns will advance the overall
interests of the company that will help to safeguard the companys assets, financial integrity and reputation. All Directors and Senior Management Team should adhere to the Code of Conduct and Ethics of the company. Violations of this Code of Ethics will result in disciplinary action, which may even include termination of services of the employee. The Board of Directors or any person designated by the Board for this purpose shall determine appropriate action in response to violations of this Code. Compliance Officer : Mr. R. Soundar Rajan , Company Secretary He can be reached at soundar@sagarcements.in Environment Committment Sagar Cements is committed to being an responsible organization with respect to environment and has adopted various measures to reduce the carbon footprint by increasing the efficiency of our operations. Social Committment Sagar Cements is committed to providing safe and healthy working environments for its employees and also contributing to the enhancement of quality of life of the people residing in and around the plant and other parts of the state by conducting several community programs and contributing to welfare measures. Products Sagar Cement is a leading producer of different types of Cements in the State of Andhra Pradesh. The different types of cement produced include: 53 Grade OPC 43 Grade OPC
53 Grade OPC is a higher strength cement to meet the needs of the consumer for higher strength concrete... The 43 grade OPC is the most popular general-purpose cement in the country today. The production of 43 grade OPC is nearly... 33 Grade OPC Portland Pozzolana Cement
This cement is used for general civil construction work under normal environmental conditions. The compressive strength... Portland Pozzolana Cement is a kind of Blended Cement which is produced by either intergrinding of OPC clinker...
53 Grade OPC 53 Grade OPC is a higher strength cement to meet the needs of the consumer for higher strength concrete. As per BIS requirements the minimum 28 days compressive strength of 53 Grade OPC should not be less than 53 MPa. For certain specialized works, such as pre-stressed concrete and certain items of precast concrete requiring consistently high strength concrete, 53 grade OPC is found very useful. 53 grades OPC produce higher-grade concrete at very economical cement content. In concrete mix design, for concrete M-20 and above grades a saving of 8 to 10 % of cement may be achieved with the use of 53 grade OPC. 53 Grade OPC can be used for the following applications. + RCC works(Preferably where grade of concrete is M-25 and above)
+ Precast concrete items such as paving blocks, tiles building blocks etc. + Pre-stressed concrete components
+ Runways, concrete Roads, Bridges etc.
43 Grade OPC The 43 grade OPC is the most popular general-purpose cement in the country today. The production of 43 grade OPC is nearly 50% of the total production of cement in the country. 43 Grade OPC can be used for the following applications: + General Civil Engineering construction work. + RCC works(preferably where grade of concrete is up to M-30). + Precast items such as blocks, tiles, pipes etc. + Asbestos products such as sheets and pipes. + Non-structural works such as plastering, flooring etc. Network The network of our dealers has been ensuring the fast and easy reach with speedy feedback. The wide network of our dealers even more ensures that not even a single remote area is left. Further, We take pleasure to appreciate our most trusted dealers who are helping us to utilize the full capacity of our plants. Dealers Request for Dealership
The network of our dealers has been ensuring the fast and easy reach with speedy feedback. The wide network of our dealers even more ensures that not even a single remote area is left. Further, We take pleasure to appreciate our most trusted dealers who are helping us to utilize the full capacity of our plants.The 43 grade OPC is the most popular general-purpose cement in the country today. The production of 43 grade OPC is nearly...
Careers Like any other standard company, Sagar Cements Limited too believes that the employees are the most important assets to the company. Our 3000 trained and professional employees make the toughest targets possible. We too care for them in every way so that they can have total job satisfaction while putting efforts to serve the end users in a best possible way. Values Skill Development
Sagar Cements was built on a strong foundation of fundamental values of responsibility, respect & trust....Sagar Cements actively supports skill development programs to train workers to professional level..... Open Jobs Apply Online
Currently advertised positions for inspired and energetic people to join the Sagar Cements team....Sagar Cements was built on a strong foundation of fundamental values of responsibility, respect & trust...
THEORETICAL FRAME WORK

INTRODUCTION The financial statements are important aid to financial analysis. The focus of financial analysis is on key figures in the financial statements and significant relationships that exist between them. The analysis of financial statement is a process of evaluating relationship between component parts of financial statements to obtain a better understanding of the firms position and performance. STEPS INVOLVED IN FINANCIAL STATEMENTS ANALYSIS: The analysis of the financial statements requires: The first task of the financial analysis is to select the information relevant to the decision under consideration from the total information, contained in the financial statements. The second step involved in financial analysis is to arrange the information in a way so as to highlight significant relationships. The final step is interpretation and drawing of inferences and conclusions. In brief financial analysis is the process of selections, relation and evaluation. Financial statements are the basic for decision making by the management as well as all other outsiders. Who are interested in affairs of the firm such as investors creditors, customers, suppliers, financial institutions, employers, potential investors, government and general public? The analysis and interpretation of financial statement depend upon the nature and type of information available in these statements. Financial statements are prepared primarily for decision-making. They play a dominant role in setting the framework of managerial decision. Financial analysis is the process of identifying the financial strengths and weakness of the firm by properly establishing relationship between the items of the balance sheet and profit and loss account.
The main concern of a financial management is considered with raising financial resources and their effective utilization towards achieving in the organization goals. FINANCE MANAGEMENT: It is concerned with the acquisition, financing and management of assets with over all goals in mind. Thus it involves decisions relating to these three aspects all these areas are interrelated the decision to acquire assets necessitates the financing and management cost effect the decision to invest. All these decisions determine the firm to its shareholders. MEANING AND DEFINITION OF FINANCIAL MANAGEMENT: A financial statement is a collection of data organized according to logical and consistent accounting procedures; its purpose is to convey an understanding of some financial aspects of a business firm. It may show the position at a moment of time, as in the period of time as in the case of an Income Statement. The term financial analysis also known as analysis and interpretation of financial statement refers to process of determining financial strengths and weaknesses of the firm by establishing strategic relationship between the items of the Balance sheet, profit and loss account. DEFINITIONS: Financial statement analysis is largely a study of relationship among the various financial factors in a business or disclosed by single set of statements and a study of the trend of these factors as shown in a series of statement. The financial statements provide a summary of accounts of a business enterprise the balance sheet reflecting the assets, liabilities and capital as a certain data and the income statement showing results of operations during a certain period. - John N.Myers
According to Metcalf and Titard: is a process of evaluating the relationship between component parts of a financial statement to obtain a better understanding of a firms position and performance. NATURE AND OBJECTIVES OF FINANCIAL STATEMENTS Nature: The financial statements are prepared on the basis of recorded facts. The recorded facts are those which can be expressed in monitory terms the statements are prepared for a particular period, generally one year. The accounting records and financial statements are prepared from these records are based on the historical costs. The financial statements, by nature, are summarizes of the items recorded in the business and these statements are prepared periodically, generally for the accounting period. The American Accounting Association expresses in its statements. Every corporate statement should be based on accounting principles that are sufficiently uniform, objective and well understanding to justify opinions as to the conditions and progress of business enterprises. And it also states the nature of financial statement as Financial statements are prepared for the purpose of presenting a periodical review of report on progress by the management and deal with the status of investment in the business and the results achieved during the period under review. The financial statements are composed of data which is the result of combination of 1. Recorded facts concerning business transactions 2. Convection adopted to facilitate the accounting technique. 3. Postulates or assumptions made to personal judgments used in the application of the correction and postulates.
OBJECTIVES OF FINANCIAL STATEMENTS: Financial statements are the sources of information on the basis of which conclusions are drawn about the probability and financial positions of a concern. They are the major means employed by firms to present their financial situation of owners, creditors and the general public. The primary objectives of Financial Statements are to assist in decision-making. The Accounting principles Board of America (APB) state the following objectives of Financial Statements. The basic objectives of financial statements are to furnish information required for decision-making. Other objectives are: i. ii. iii. iv. v. To provide reliable financial information about economic resources and obligations of an enterprise. To provide reliable information about changes is net resources of an enterprise that result from the activities. To provide financial information that assists in estimating the earnings potential of the enterprise. To provide other relevant information about changes in the economic resources and obligations, and To disclose, to the extent possible, other information related to the financial statements relevant to the users of the statements. IMPORTANCE OF FINANCIAL STATEMENTS: The information given in the financial statement is very useful to number of parties as given below: Owners: Owners provide funds for the operations of a business and want to know whether their funds are properly utilized or not. The financial statement is prepared from time to time to satisfy their curiosity.
Creditors: Creditors want to know the financial position of a concern before giving loans or granting credit. The financial statements help them in judging such position. Investors: Prospective investor, who wants to invest money in a firm, would like to make an analysis of the financial statements of that to know how state proposed investment will be. Managers: Management is the art of getting things done through others. This requires that the subordinates are doing work properly. Financial statements are an aid in this respect because they serve the manager in appraising the performance of the subordinates. Actual results achieved by the employees can be measured against the budgeted performance they were expected to achieve and remedial action can be taken if the performance is not up to the mark. TYPES OF THE FINANCIAL STATEMENTS The term financial statements generally refers to two basic statements viz., i. ii. iii. iv. The Income Statement. The Balance Sheet of course a business may also prepare A statement of Retained Earnings and A statement of Changes in Financial Position in addition to the above two statements. The meaning and significance of each of these statements is explained below: 1) INCOME STATEMENT: The income statement, (also termed as Profit and Loss account) shows the income and expenses under different head. The income minus expenditure indicates the profit made by the firm. Broadly there are three kinds of expenses, Sales income minus the expenses incurred on operations, gives the operating profit for a given year.
2) BALANCE SHEET: The Balance sheet is a statement of financial position of a business at a specified moment of time. It is a statement of assets and liabilities of a firm or what it owes and what it owns, as on a given date. In a Balance sheet, the assets and liabilities balances are equal to each other, as the statement is based on the double entry system of bookkeeping. The important distinction between an Income statement and a Balance sheet is that Income statement is for a period while Balance sheet is on a particular date ROLE OF FINANCIAL STATEMENTS: Finance is regarded as the lifeblood of a business enterprise i.e., finance is to business what blood is to human body. This is because in the modern money oriented economy; finance is one of the basis foundation of all kinds of economic activities. It is the master key, which provides access to all sources for being employed manufactured and economic activities. However it is also true that money be gets more money. Only when it is properly managed. Hence efficient management of every business enterprise is closely limited with effect management of its finance. SCOPE OF FINANCIAL MANAGEMENT: The approach to the scope of financial management is divided, for purpose of exposition in to two broad categories. a) The Traditional approach and b) The Modern approach.
a) Traditional Approach: The traditional approach to the scope of financial management refers to its subject matter, in academic literature in the initial stages of its evolution, as a separate branch of academic study. The term corporation finance was use to describe what is now known in the academic world as financial management.
The scope of the finance was of funds by corporate enterprise to meet their financial needs. The field of study dealing with finance was treated as encompassing three interrelated aspects of raising and administering resource from outside. 1. 2. The institutional arrangement in the form of financial institutions, which comprise the organization of the capital, market. The financial instrument through which funds are raised from the capital market and the selected aspects of practices and the procedural aspects of capital market. 3. The legal and accounting relationship between a firm and its source of funds. The traditional approach to the scope of finance function evolves during the 1920s and 1930,s and it dominated in this decade. But it has now discarded as suffers from serious limitations they are: i) ii) Those relations to the treatment of various topics and the emphasis attach to them. These relating to the basic conceptual and analytic framework of definition and scope of finance function. b) MODERN APPROACH: The modern approach view the term financial management in a broad sense and provides a conceptual and analytical framework for financial decision making. Thus, the finance function covers both acquisition of funds as well as their allocations. Defined in a broad sense, it is viewed as an integral part of overacts management. The principles contains of the modern approach to the financial management can be said to the 1. 2. 3. How large should an enterprise be and how fast should it grow? In what from should it hold assets? And What should be the composition of its liabilities?
IMPORTANCE AND USES OF FINANCIAL STATEMENTS: Financial Statements assume importance by reporting the financial position and operating results of an enterprise at the end of the accounting period. The impact of business transactions on the financial position and progress of the enterprise is briefly disclosed by these statements. Financial statements may be described as a comprehensive index of the financial affairs of a concern and are useful in many ways to a variety of people. Managers are responsible for the overall performance of the firm. They make several decisions and therefore, need information. Accounting provides relevant information of them. Thus, they have a direct interest in accounting information. Some users of the accounting information have a direct interest in the firm while others have an indirect interest. Those who directly interested in the financial information, are owners, managers, creditors, investors, employees, customers, and tax authorities. Creditors supply financial resources to the firm. They are interested in the continuing profitable performance of the firm, so that they may regularly receive interest and repayment of the principal sum. They need accounting information to estimate the firms performance and to determine the degree of risk to which they are exposed. Potential investors, creditors or owners, get an idea about the firms financial strength and performance from its financial reports. They are generally interested in the earnings, dividend, and growth trends of the firm. Customers may be interested in the financial statements of a firm, because a careful study of financial statements may provide information about the prices being charged by the firm. Hence the financial statements are most important and useful for the knowing each and every significant aspect of the company and taking for taking useful decisions.
LIMITATIONS OF FINANCIAL STATEMENTS:
Financial statements are the result of the accounting process which involves recording, classifying, and summarizing, but the profit/loss figure and financial position as disclosed by Income Statement and Balance Sheet respectively should not be taken to be an exact representation of actual position. The financial statements are based on certain accounting concepts and conventions. The following are the important limitations of financial statements:

The information is historical in nature. It is the outcome of accounting concepts and conventions combined with personal judgment. The statements portray the position in monetary terms only. Things which cannot be translated in to monetary terms viz., development of a team of loyal and efficient workers, enlightened management, the reputation and prestige of management cannot be covered. While studying financial statements of different units, the size of the units and difference in the accounting procedures adopted by them have to be kept in mind.
1.
The study is mainly based on the date provided in the annual reports of the company. Therefore the accuracy of the study depends upon accuracy of the data.
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3.
The study mainly carries out based on the secondary data provided in the financial statements. The study is based on the historical data. There fore it may not be future indicators. The researcher has a limited knowledge. As the study period is very short (5 years i.e. 2004-09) the calculated analysis may not give a correct view about the financial performance. There may be some fractional differences in the calculated ratios. There may be some financial differences in calculated ratios.
4. 5. 6.
FINANCIAL STATEMENTS ANALYSIS:
The financial statements provide, for the readers, understanding of some financial aspects of a firm and also reveal the result of series of activities over a given period of time. The above said functions delivered by financial statements are of primary in nature. By analyzing the same information from financial statements one can understand much more important things like, financial strengths and weakness of a firm. I) Meaning of a financial analysis: The financial statements also to better explain the financial strengths and weakness of a firm. In such a case the financial statement analysis can be defined as the process of identifying the financial strengths and weaknesses of the firm by properly establishing the relationships between the items of balance sheet and profit and loss account. Analysis involves breaking/separating a thing into its components, establishing the existing relationships between the key items/components, interpreting the relationship so as to draw meaningful inferences. a) Type of relationship to the established: The type of relationship to be investigated depends upon the objective and purpose of evaluation. The purpose of evaluation of financial statements differs among various groups interested in the result reported in the financial statements. For example, short-term creditors are primarily interested in judging the firms ability to pay its currently maturing obligations. b) Focus on key figures: Although many financial items/figures are available in the financial statements, the analysis should focus on key items only. If this is not the case, each small, or unimportant figures also merits for analysis. This leads to emergence of unimportant conclusions. A single item or a group of items may be key figures for analysis. Generally, capital, net worth, sales, expenses categorized under different heads are some better example of key figures. c) Analysis and interpretation:
Analysis and interpretation are closely interlinked. They are complimentary to each other. Analysis with out interpretation is useless and interpretation without analysis is impossible. But, generally, the term analysis is used to include interpretation as well, since analysis always aimed at interpretation of relationships that are established in the course of analysis. OBJECTIVES OF FINANCIAL ANALYSIS: The following are some of the important objectives of financial statement analysis a) It helps in assessing the present and future earning capacity or profitability of the concern. b) It helps in determining the operational efficiency of the concern as a whole and of its various departments. c) It helps in assessing short-term and long-term liquidity of the concern, which is highly useful to the suppliers of funds. d) It helps in undertaking a comparative study in regard to one firm with another firm of same concern over a period of years or one department with another department of the concern. e) It helps in studying the possibility of developments in the future by making forecasts and preparing budgets. f) It helps in learning the financial stability of a concern by the application of ratio techniques. g) It helps in identifying the reason for change in the profitability/ financial position of the firm.
h) It helps in assessing the real meaning and significance of financial data.
TYPES OF FINANCIAL ANALYSIS:
The analysis of financial statements can be done on the basis of the following criteria; A) B) Material used for analysis, Modus operandi of the analysis.
A) Material used for analysis: The financial analysis can be done on the basis of financial information of a firm. This information can be had either from externally available reports like financial statements or internally available records books of accounts. The types of analysis can be decided. Thus the analysis based on material used can be of two types. i) Internal analysis, ii) External analysis.
I.
Internal analysis: This analysis is made use by those persons who have access to the books of accounts. When the financial statements are analysed for managerial purposes by the member of the organization, it is called as internal analysis.
II.
External analysis: This type of analysis is done by utilising information from financial statements, which are available externally to any interested party. Investors, lenders, governmental agencies and labour unions generally undertake this type of analysis. They do not have access to the internal records of the firm and mainly depend upon published financial statements. Such an analysis cannot be detailed one and as such serves only a limited purpose. B) Modus operandi of the analysis: The other basis on which financial analysis can be viewed is Modus operandi.
According to this, financial analysis can also be of two types: i) Horizontal Analysis ii) Vertical analysis I. Horizontal Analysis:
In case of this type of analysis, financial statements for a series of years are collected and analyzed. The current years figures are compared with the standard or base year. The analysis statement usually contains figures for two or more years and the changes in each item are shown from the base year in the form of percentages. Such an analysis gives the management considerable insight into levels and areas of the strength and weakness. Since this type of analysis is based on the data from year to year rather than as one date, it is also termed as DYNAMIC ANALYSIS. II. Vertical analysis This analysis refers to review or analysis of financial statements of one particular year only. In this analysis the figures selected from financial statement of a year or compared with a base selected from the same financial statement. Normally, common size statements and ratio analysis are used in the vertical analysis. Measurement of financial performance of overseas: Financial analysis is made to know the operation and financial problems faced by the company, with the help of data and information presented in financial statements. The financial analysis may also be required internally for control and improving manager decision-making and the result of the business operations. This analysis helps in examining the financial strength and weave ness of the company. The main objectives of financial analysis are to assess. The present and future earning capacity of the company. The operational efficiency of the company as a whole and its various departments. The short-term and long-term solvency of the company for the benefit of the debenture holders and trade creditors. The Financial stability of a company. TOOLS OF ANALYSIS:
Financial tool is a logic employed by a skilled analyst to measure the effectiveness of operations of a company and to assess the validity of decisions. An array of financial tools involves analysis of the relationships among the financial statements and the changes that has taken place in these items as reflected by successive financial statements. 1. Comparative statements 2. Common- size statements 3. Trends analysis 4. Funds flow statements 5. Cash flow statements 6. Ratio analysis. Common size statements: The common size statements, balance sheet and income statement are shown in analytical percentages. The figures are shown as percentage of total assets, total liabilities and total assets. The total assets are taken as 100 and different assets are expressed as percentage of the total similarly various liabilities are taken as a part of total liabilities. Trend analysis: Trend analysis depicts behaviors of the ratios over a period of time and the trends in the operation of the enterprise. The trend figures are index figures going a birds exe view of the comparative data by presenting it over a period of time. Funds flow statements: Funds flow a statement that shows the movements of funds and is a report of financial operations of the business undertaking. It indicates various means by which funds were obtained a particular period and the ways to which these funds were employed. Cash flow statements:
A statement of changes in financial position of firm on cash basis is called cash flow statements such a statement enumerates net effects of the various business transactions on cash, and takes into account receipt and disbursements of cash. A cash position of a business enterprise between data of two balance sheets. COMPARATIVE STATEMENTS ANALYSIS: Objectives After studying this lesson, you should be able to Understand the comparative statement analysis. Prepare the comparative statement, and interpret the changes efficiently. Structure

Introduction Need for comparative Statements Comparative Income Statement Comparative Balance Sheet Limitations of Comparative Financial Statements
Introduction You have learnt the basics of financial statements and analysis and interpretation of the same, in the last lesson. An important technique of financial analysis, i.e., comparative statement analysis, is discussed in this lesson, so as to enable you to undertake the analysis of financial statements of a concern. Need for comparative statement analysis The financial statements viz., the balance sheet and the profit and loss account contain summarized information of the firms financial affairs organized systematically. The balance sheet indicates the financial position or the state of affairs of a business at a particular moment of time similarly; profit and loss account is the score board of the firms performance during a particular period of time. Although these two statements do inform about financial affairs at a point of time and results of the operations conducted during a year, they do not reveal the
periodic changes took place. The periodic changes mean changes in the value of a financial element at a time compared to some previous date. The know the periodic changes in financial variables, the tool comparative financial statement being prepared. This analysis is an example of Horizontal analysis, as it relates to arriving at the change in a single item from one period compared to the other. In brief, comparative financial statements are those statements, which have been designed in a way so as to provide time perspective to the consideration of various elements of financial position embodied in such statements. Comparative Income Statement: A comparative income statement will show: i. ii. iii. Absolute figures for two (or more) periods. The absolute change from one period to another and The relative/percentage change
Relating to the items pertaining to income statement viz., net sales, cost of goods sold, gross profit, administrative expenses etc. The reader may quickly ascertain whether the cost goods sold has increased or decreased by just glancing at the statement. A report of interpretation of the changes in various financial items will be much useful in arriving at meaningful conclusions. Comparative Balance Sheet: Actually speaking, comparative balance sheet will be similar to that of comparative income statement except that it draws its financial items from Balance sheet pertaining to two different years and tabulated in vertical statement. Interpretation report, similar to the comparative income statement, is arranged at the end for arriving at conclusions.
Limitations of Comparative Financial Statements
Though the comparative analysis is more useful technique, an analysis must keep the following limitation in his mind, when this technique, an analysis of the financial statements. 1. The comparative analysis will be less effective, when the data and accounting methods of different periods or companies are not in uniform. 2. As the data for more number of years/companies is taken, the number of periodic changes will increase and which may put the analyst in trouble for effective interpretation of periodic changes. 3. While computing the percentages, one must be very careful. Otherwise the wrong conclusions may be drawn. 4. The preparation of comparative statement and analysis and interpretation of the same requires some specialized knowledge.
DATA ANALYSIS
COMPARATIVE BALANCE SHEET OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2007& 2008 ABSOLUTE CHANGE 0 6717956.22 17763259.48 5000000 89946 691219 30262380.7 PERCENTAGE OF CHANGE 0 21.13 195.12 100 0.34 34.79 30.97
PARTICULARS
31-03-2007
31-03-2008 23431000 26867178.33 10000000 26483547.4 2678331 127974565.6 1 45360574.65 27000 3896967
SOURCES OF FUNDS Share capital 23431000 Reserve & surplus Secured loans Unsecured loans Sales tax 9103918.85 5000000 deferred 26393601.4
31796552.66 38514508.88
liability Provision for deferred 1987112 tax liability TOTAL 97712184.9
1 APPLICATION OF FUNDS Fixed assets Investments Deposits advances Preliminary TOTAL 41819971 27000 4584922
3540603.65 0 -687955 27413822.05 -4090 30262380.7
8.47 0 -15 53.47 -50 30.97
Current assets, loans& 51272111.91 78685933.96 & pre- 8180 97712184.9 1 4090 127974565.6 1
operative expenses
INTERPRETATION
1. The comparative balance sheet of the company reveals that during the year 2007,
there has been sound increase in current assets, loans & advances of 27413822.05 i.e., 53.47%. this fact depicts that the companys liquidity position is good. 2. The company has increased the unsecured loan of Rs.5000000 i.e., 100%. And also there is a sound increase in secured loan of Rs.17763259.48 i.e.,195.12% 3. While there is increase of fixed asset value to the extent of Rs. 3540603.65 i.e., 8.47%. This fact depicts that the company has diverted its loan to purchase fixed assets. 4. On the whole, overall financial position of the company satisfactory.
COMPARATIVE BALANCE SHEET OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2008 & 2009
PARTICULARS 31-03-2008 31-03-2009 ABSOLUTE CHANGE SOURCES OF FUNDS Share capital Reserve & surplus Secured loans Unsecured loans Sales tax 23431000 38514508.88 26867178.33 10000000 23431000 51326867.89 36200447.38 13830206 26473735.4 2783243 0 12812359.01 9333263.05 3830206 -9812 104912 0 33.27 34.73 38.3 -0.037 3.92 PERCENTAGE OF CHANGE
deferred 26483547.4
liability Provision for deferred 2678331 tax liability TOTAL 127974565.61
154045499.67
26070934.06
20.37
APPLICATION OF FUNDS Fixed assets Investments Deposits 45360574.65 27000 3896967 43734109 27000 4247949 106036441.67 0 154045499.67 -1626465.65 0 350982 27350507.71 -4090 26070934.06 -3.59 0 9.006 34.76 -100 20.37
Current assets, loans& 78685933.96 advances Preliminary & pre- 4090 127974565.61
operative expenses TOTAL
INTERPRETATION 1. The comparative balance sheet of the company reveals that, there slight increasing comparatively previous year of Rs. 27350507.71 i.e., 34.76%. Any way the companys liquidity position is good.
2. The company has increased the secured and unsecured loans of 9333269.05 and
3830206 i.e., 34.73% and 38.30% respectively. 3. The companys reserves and surplus is increased by 12812359.01 i.e., 32.27% 4. There is short decrease in companys fixed asset value of -1626465.65 i.e., -3.59%. 5. The preliminary and pre-operative expenses were total written off. 6. On the whole, overall financial position of the company is satisfactory.
ABSOLUTE CHANGE PERCENTAGE OF CHANGE
PARTICULARS SOURCES OF FUNDS Share capital Reserve&surplus Secured loans Unsecured loans Sales liability tax
31-03-2009
31-03-2010
23431000 51326867.89 36200447.38 13830206 deferred 26473735.4
23431000 72621203.04 54353221.01 17810745 26579192
0 21294335.15 18152773.63 3980539 105456.6
0 41.49 50.15 28.78 0.4
Provision for deferred 2783243 tax liability TOTAL 154045499.67
2694458.9
-88784.1
-3.19
197489819.95
43444320.28
28.20
APPLICATION OF FUNDS Fixed assets Investments Deposits 43734109 27000 4247949 47415935 27000 4740902 145305982.95 3681826 0 492953 39269541.28 8.42 0 11.6 37.03
Current assets, loans& 106036441.67 advances Preliminiary & pre- 0
operative expenses TOTAL 154045499.67 197489819.95 43444320.28 28.20
INTERPRETATION
1. The comparative balance sheet of the company reveals that, there were increase of current assets, loans & advances of Rs.39269541.28 i.e., 37.03%. Which depicts that the companys liquidity position is satisfactory? 2. There is a sound increase in secured loans value of 18152773.63 i.e., 50.15%. and also increase in unsecured loan of Rs.3980539 i.e., 28.78%. 3. There is an increase in fixed asset value of Rs.3681826 i.e., 8.42%. This fact depicts that the company is diverting its loan to purchase fixed asset. 4. There is increase in increasing rate of reserves & surplus of Rs.21294335.15 i.e., 41.49%. This depicts the good profitability of the company. 5. On the whole, overall financial position of the company satisfactory.
PARTICULARS
31-03-2010
31-03-2011
ABSOLUTE PERCENTAGE CHANGE OF CHANGE 0 14.27 -13.72 44.25 0 41.38
SOURCES OF FUNDS Share capital 23431000 Reserve surplus Secured loans Unsecured loans & 72621203.04 54353221.01 17810745
23431000 82985086.60 46893584.12 25692270.90 26579192 3809447
0 10363883.56 -7459636.89 7881525.9 0 1114988.1
Sales tax deferred 26579192 liability Provision deferred liability TOTAL for 2694458.90 tax 197489819.9
209390580.6 2 76281546.5 27000 6277902
11900760.67
6.026
5 APPLICATION OF FUNDS Fixed assets 47415935 Investments Deposits Current 27000 4740902
28865611.5 0 1537000
60.88 0 32.42
assets, 145305982.95 126804132.12 -18501850.83 -12.73 197489819.9 5 209390580.6 2 11900760.67 60.26
loans& advances TOTAL
INTERPRETATION
1. The comparative balance sheet of the company reveals that, there is decrease in current assets, loans& advances of Rs. -18501850.83 i.e., -12.73% . This fact depicts that the company is losing its liquidity.
2. There is increase in the unsecured loan value of Rs.7881525.9 i.e., 44.25% and
we can see the decrease in secured loan of Rs.-7459636.89 i.e., -13.72%. 3. There is a sound increase in the companys fixed asset value of Rs.28865611.5 i.e., 60.88% and also increase in deposits of the company of Rs.1537000 i.e., 32.42%. 4. The above fact depicts that the company is diverting its loan amount to purchase fixed assets. 5. There is a decrease in increasing rate of reserves & surplus of 14.27%. which amounted 10363883.56 6. On the which, overall financial position of the company satisfactory.
COMPARATIVE BALANCE SHEET OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2011 & 2012 PARTICULARS Year-2011 Year-2012 ABSOLUTE CHANGE SOURCES OF FUNDS Share capital 23431000 Reserve & surplus Secured loans Unsecured loans Sales tax 82985086.60 46893584.12 25692270.90 23431000 85218617.33 41498464.30 36181575.20 26579192 5335491.28 0 2233530.73 -5395119.82 10489304.3 0 1526044.28 PERCENTAGE OF CHANGE 0 2.69 -11.50 40.82 0 40.06 4.228 28.63 0 21.95 -11.27 4.228
deferred 26579192
liability Provision for deferred 3809447 tax liability TOTAL
209390580.62 218244340.11 8853759.49 98043419.75 27000 7655913 21761873.25 0 1378011 -14286124.76
APPLICATION OF FUNDS Fixed assets 76281546.5 Investments Deposits 27000 6277902
Current assets, loans& 126804132.12 112518007.36 advances TOTAL
209390580.62 218244340.11 8853759.49
INTERPRETATION
1. The comparative balance sheet of the company reveals that, there is decrease in current assets, loans& advances of Rs. 14286124.76 i.e., -11.27% . This fact depicts that the company is losing its liquidity.
2. There is increase in the unsecured loan value of Rs.36181575.20 i.e., 40.82%
and we can see the decrease in secured loan of Rs.41498464.30 i.e., -11.50%.
3. There is a sound increase in the companys fixed asset value of Rs.98043419.75
i.e., 28.63% and also increase in deposits of the company of Rs.7655913 i.e., 21.95%.
4. The above fact depicts that the company is diverting its loan amount to purchase
fixed assets. There is a decrease in increasing rate of reserves & surplus of 2.69%. This amounted 85218617.33. 5. On the which, overall financial position of the company satisfactory.
COMMOMN SIZE BALANCE SHEET OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2007 & 2008
PARTICULARS
31-03-2007 PERCENTAGE 31-03-2008 OF CHANGE
PERCENTAGE OF CHANGE
SOURCES OF FUNDS Share capital Reserve& surplus Secured loans liability Provision deferred liability TOTAL for 0 tax 51833191.1 100 71941563.4 8 64.28 0.1 2.94 30856945 27000 1554192 42.89 0.04 2.16 100 0 1188516 1.65 23431000 4514157.35 4153804.78 45.2 8.71 8.01 38.08 23431000 8119302.71 32.57 11.29 15921035.29 22.13 23281709.48 32.36
Sales tax deferred 19734229
3 APPLICATION OF FUNDS Fixed assets Investments Deposits Current loans& advances Preliminiary pre-operative expenses TOTAL 51833191.1 3 100 & 16360 0.04 33320851 53520 1521927
assets, 16920533.13 32.64
39491156.48 54.89 12270 0.02
71941563.4 8
100
INTERPRETATION
1. The analysis of current assets, loans & advances of both the years shows that the
percentage of current assets, loans & advances to that of total assets is 32.64% in 2007, and increased to 54.89% in the year 2008 and in the both the years the company is having adequate working capital.
2. The analysis of fixed assets of both the years shows that the percentage of fixed
assets to that of total assets is 64.28% in the year 2007 and it reduced to 42.89% in the year 2008.
3. Companys
reserves capacity is very good. Because percentage of in
reserves to that of total liabilities is 8.7% in 2007, it increased to 22.13% 2008.
PERCENTA PARTICULARS 31-03-2008 GE CHANGE SOURCES OF FUNDS Share capital Reserve& surplus Secured loans Unsecured loans liability Provision deferred liability TOTAL 23431000 15921035.29 8119302.71 0 32.57 22.13 11.29 0 32.36 1.65 23431000 31796552.6 6 9103918.85 5000000 26393601.4 1987112 OF 31-03-2009
PERCENTA GE CHANGE 23.98 32.54 9.32 5.12 27.01 2.03 OF
Sales tax deferred 23281709.48 for 1188516 tax 71941563.48
100
97712184.9 1
100
APPLICATION OF FUNDS Fixed assets Investments Deposits Current 30856945 27000 1554192 assets, 39491156.48 42.89 0.04 2.16 54.89 0.02 100 41819971 27000 4584922 51272111.9 1 8180 97712184.9 1 42.80 0.03 4.69 52.47 0.01 100
loans& advances Preliminary & pre- 12270 operative expenses TOTAL 71941563.48
INTERPRETATION
percentage of current assets, loans & advances to that of total assets is 54.89% in
2008 and it decreased to 52.47% in 2009 and in the both the years the company is having adequate working capital.
2. The analysis of fixed assets of both the years shows the percentage of fixed
assets to that of total assets is 42.89% in 2008 and 42.80% in 2009.

3. Companys reserves capacity is very good. Because percentage of Reserves
&surplus to that of total liabilities is 22.13% in the year 2008 and it increased to 32.54% in the year 2009.
PARTICULARS 31-03-2009 SOURCES OF FUNDS Share capital Reserve& surplus Secured loans Unsecured loans liability Provision deferred liability TOTAL 23431000 9103918.85 5000000
PERCENTAGE OF CHANGE 23.98 9.32 5.12 27.01 2.03
31-03-2010
PERCENTAGE OF CHANGE 18.31 30.10 20.99 7.81 20.69 2.1
23431000 38514508.88 26867178.33 10000000 26483547.40 2678331
31796552.66 32.54
Sales tax deferred 26393601.4 for 1987112 tax 97712184.9
100
127974565.6 1
100
1 APPLICATION OF FUNDS Fixed assets 41819971 Investments Deposits Current 27000 4584922
42.80 0.03 4.69
45360574.65 27000 3896967 78685933.96 4090
35.44 0.02 3.04 61.49 0.01
assets, 51272111.91 52.47 0.01
loans& advances Preliminary & 8180 pre-operative expenses TOTAL
97712184.91 100
127974565.61 100
INTERPRETATION
percentage of current assets, loans & advances to that of total assets is 52.47% in 2009 and it increased to 61.49% in the year 2009. And in the both the years the company is having adequate working capital.
3. Companys reserve capacity is very good. Because percentage of Reserves &

surplus to that of total liabilities is 32.54% in 2009 and 30.10% in 2010 .
COMMOMN SIZE BALANCE SHEET OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2010 & 2011 PERCENTAGE OF CHANGE PERCENTAGE OF CHANGE
PARTICULARS 31-03-2010 SOURCES OF FUNDS Share capital Reserve& surplus Secured loans Unsecured loans 23431000 38514508.88 26867178.33 10000000
31-03-2011
18.31 30.10 20.99 7.81 20.69
23431000 51326867.89 36200447.38 13830206 26473735.4
15.21 33.32 23.5 8.98 17.19
Sales tax deferred 26483547.40 liability Provision deferred liability TOTAL 127974565.6 1 APPLICATION OF FUNDS Fixed assets Investments Deposits Current 45360574.65 27000 3896967 assets, 78685933.96 for 2678331 tax
2.1
2783243
1.8
100
154045499.6 7
100
35.44 0.02 3.04 61.49
43734109 27000 4247949
28.39 0.02 2.76
106036441.67 68.83
loans& advances TOTAL 127974565.6 1 100 154045499.6 7 100
INTERPRETATION
Percentage of current assets, loans & advances to that of total assets is 61.49% in 2010 and it increased to 68.83% in the year 2011 and in the both the years the company is having adequate working capital.

3. Companys reserve capacity is very good. Because percentage of reserves &
surplus to that of total liabilities is 30.10% in 2010 and increased to 33.32% in 2011.
COMMOMN SIZE BALANCE SHEET OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2011& 2012
PARTICULARS 31-03-2011 SOURCES OF FUNDS Share capital Reserve& surplus Secured loans Unsecured loans 23431000 51326867.89 36200447.38 13830206
31-03-2012
15.21 33.32 23.5 8.98 17.19
23431000 72621203.04 54353221.01 17810745 26579192
11.86 36.77 27.52 9.02 13.46
Sales tax deferred 26473735.4 liability Provision deferred liability TOTAL for 2783243 tax 154045499.6
1.8
2694458.90
1.37
100
197489819.9 5
100
7 APPLICATION OF FUNDS Fixed assets Investments Deposits Current 43734109 27000 4247949 28.39 0.02 2.76
47415935 27000 4740902
24.01 0.01 2.4
assets, 106036441.67 68.83
145305982.95 73.58
loans& advances TOTAL 154045499.6 7 100 197489819.9 5 100
INTERPRETATION
percentage of current assets, loans & advances to that of total assets is 68.83% in 2011 and increased to 73.58% in 2012 and in the both the years the company is having adequate working capital.
assets to that of total assets is 28.39% in 2011 and it decreased to 24.01% in the year 2012.
3.
Companys reserve capacity is very good. Because percentage of reserves & surplus to that of total liabilities is 33.32% in 2011 and increased to 36.77% in 2012.
COMPARATIVE INCOME STATEMENT OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2007 & 2008
PARTICULARS 31-03-2007 31-03-2008 ABSOLUTE CHANGE PERCENTAG E OF CHANGE 47.94 40.68 100 47.59
INCOME Sales Other receipts Increase/ decrease finished stock TOTAL(A) EXPENDITURE Consumption of raw 111692719.74 material & store Manufacturing expenses 13872935.93 Taxes & duties Administrative expenses Interest & charges Depreciation Misc expenses Decrease in stock TOTAL(B) 31571594.44 2662990.56 finance 616676 1826842 4090 finished 150843.20 162398691.87 170317647 18251986.27 44979966.63 5282272.94 486760.23 1852573 4090 0.00 241175296.07 17001688.37 327575 798596 15875517.37 15921035.29 31796552.66 58624927.26 4379050.34 13408372.19 2619282.38 -129915.77 25731 0 -150843.20 78776604.20 4473187.66 394468.23 355060 3723659.43 11406877.94 15130537.37 52.49 31.57 42.47 98.36 -21.07 1.41 0 -100 48.51 35.7 589.69 80.05 30.64 252.69 90.79 165084742 9842450.58 in 0 174927192.58 244225722.08 13846059.16 105203.20 258176984.44 79140980.08 4003608.58 105203.20 83249791.86
Profit before tax for the 12528500.71 year(A-B) Excess provision for -66893.23 taxation of earlier year Provision for deferred 443536 tax liability Profit after taxation 12151857.94 (PAT) Add B/f previous year 4514157.35 Balance profit/loss 16666015.29 carried to reserve & surplus
INTERPRETATION
1. The comparative income statement of the company reveals that, during the year sales are increased by 79140980.08. i.e., 47.94% and also other receipts increased by 40.68%. 2. While there is increase in sales of 47.94%, the consumption of raw material also increased by 58624929.26 i.e., 52.49%. 3. There is a sound increase of administration expenses of 2619282.38 which is 98.36%. 4. Any way the profit before tax (PBT) of the company increased by 4473187.66 i.e., 35.7%. 5. Overall the profitability of the company is more than satisfactory.
PERCENTAG E OF CHANGE -3.64 -43.32 3684.85 -4.27
PARTICULARS INCOME Sales Other receipts Increase/ decrease finished stock TOTAL(A) EXPENDITURE
31-03-2008
31-03-2009
ABSOLUTE CHANGE
244225722.08 13846059.16 in 105203.20 258176984.44
235323873.45 7847939.32 3981781 247153593.77
-8901848.63 -5998119.84 3876577.8 -11023390.67
Consumption of raw 170317647 material & store Manufacturing expenses 18251986.27 Taxes & duties Administrative expenses Interest & finance charges Depreciation Misc expenses Decrease in finished stock TOTAL(B) 44979966.63 5282272.94 486760.23 1852573 4090 0.00 241175296.07
192965699.31 28683619.81 5909210 6828216.66 2654443.92 2699138.85 4090 0.00 239744418.55 7409175.22 0.00
22648052.31 10431633.54 -39070756.63 1545943.72 2167683.69 846565.85 0 0 -1430877.52 -9592513.15 -327575
13.29 57.15 -86.86 29.27 445.33 45.69 0 0 -0.59 -56.42 -100
Profit before tax for the 17001688.37 year(A-B) Excess provision for 327575 taxation of earlier year Provision for deferred tax 798596 liability Profit after taxation (PAT) 15875517.37 Add B/f previous year 15921035.29
691219 6717956.22 31796552.66 38514508.88
-107377 -9157561.15 15875517.37 6717956.22
-13.45 57.68 99.71 21.13
Balance profit/loss carried 31796552.66 to reserve & surplus
INTERPRETATION
1. The comparative income statement of the company reveals that, during the year there is a short decline of sales by -8901848.63 i.e., -3.64% and as well as decline of other receipts of -5998119.84 i.e., -43.32%. 2. The above decline in sales caused to increase in finished stock by 3876577.8 i.e., 3684.85%. 3. While there is decline in sales by -3.64%, the consumption of raw material increased only 13.29% 4. During the year interest & financial charges of the company increased by 2167683.69 i.e., 445.33%. 5. With the above results, the company faces the loss of -56.42% (PBT) 6. On the whole, overall profitability of the company satisfactory.
PARTICULARS INCOME Sales Other receipts Increase/ decrease finished stock TOTAL(A) EXPENDITURE Consumption of raw 192965699.31 material & store Manufacturing expenses 28683619.81 Taxes & duties Administrative expenses Interest & finance charges Depreciation Misc expenses TOTAL(B) 5909210 6828216.66 2654443.92 2699138.85 4090 239744418.55 238204911.77 39648256.10 2106623 10964028.87 4281164.47 2857930.01 4090 298067004.22 19163811.01 104912 19058899.01 6246540 12812359.01 38514508.88 51326867.89 45239212.46 10964636.29 -3802587 4135812.21 1626720.55 158791.16 0 58322585.67 11754635.79 -586307 12340942.79 6246540 6094402.79 6717956.22 12812359.01 23.44 38.23 -64.35 60.57 61.28 5.88 0 24.33 158.65 -84.82 183.7 100 90.72 21.13 33.27 235323873.45 7847939.32 in 3981781 247153593.77 307228040.60 8867291.63 1135483 317230815.23 71904167.15 1019352.31 -2846298 70077221.46 30.56 12.99 -71.48 28.35 31-03-2009 31-03-2010 ABSOLUTE CHANGE PERCENTAGE OF CHANGE
Profit before tax for the 7409175.22 year(A-B) (-)Provision for deferred tax 691219 liability 6717956.22 (-) Provision for taxation Profit after taxation (PAT) Add B/f previous year 0.00 6717956.22 31796552.66
Balance profit/loss carried to 38514508.88 reserve & surplus
INTERPRETATION 1. The comparative income statement of the company reveals that during the year sales are increased by 71904167.15 i.e., 30.56% and also increased in other receipts of 1019352.31 i.e., 12.99%. 2. Consumption of raw material and manufacturing expenses increased by 45239212.46 and 10964636.29 i.e., 23.44% & 38.23% respectively. 3. During the year administration and Interest & financial charges are increased by 4135812.21 and 1626720.55 i.e., 60.57% & 61.28% respectively. 4. There is a sound increase in Profit before tax of 11754635.79 i.e., 158.65%. 5. On the whole, the profitability of the company is satisfactory.
COMPARATIVE INCOME STATEMENT OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2010 & 2011 PERCENTAG ABSOLUT E OF E CHANGE CHANGE 218806597.4 -5448880.07 3146168 216503885.3 3 71.22 -61.45 277.08 68.25
31-03-2010
31-03-2011
307228040.6 0 8867291.63 in 1135483
526034638 3418411.56 4281651
317230815.2 533734700.5 3 6
Consumption of raw 238204911.7 material & store 7 Manufacturing expenses 39648256.10 Taxes & duties Administrative expenses Interest & finance charges Depreciation Misc expenses TOTAL(B) 2106623 10964028.87 4281164.47 2857930.01 4090
429689292.09 191484380.3 2 55302431 15654174.90 4091580 12940671.82 7453592 2946126 0.00 1984957 1976642.95 3172427.53 88196 -4090 214356688.7 2147196.63 -193696.1 2340892.73 10556.60 -6246540 8481976.13 12812359.02 21294335.15
80.39 39.48 94.22 18.03 74.10 3.09 -100 71.92 11.2 -184.63 12.28 100 -100 66.20 33.27 41.49
298067004.2 512423692.9 2 1 Profit before tax for the 19163811.01 21311007.65 year(A-B) (-)Provision for deferred 104912 -88784.10 tax liability 19058899.01 21399791.75 (-)Provision for sales tax 0.00 liability (-) Provision for taxation 6246540 Profit after taxation (PAT) Add B/f previous year 12812359.01 38514508.88 105456.60 0.00 21294335.15 51326867.90 72621203.05
INTERPRETATION 1. The comparative income statement of the company reveals that during the year sales of the company increased by 218806597.4 i.e., 71.22%. And also other receipts are decreased by -61.45%. 2. Consumption of raw material and manufacturing expenses are increased by 191484380.32 and 15654174.9 i.e., 80.39% & 39.48% respectively. 3. During the year taxes & duties and interest & financial charges are increased by 94.22% and 74.10% respectively. 4. There is increase in profit before taxes of the company by 2147196.63 i.e., 11.2%. 5. On the whole, overall profitability of the company satisfactory.
COMPARATIVE INCOME STATEMENT OF SAGAR CEMENTS for THE YEAR ENDING 31ST MARCH 2011 & 2012 PARTICULARS INCOME Sales Other receipts Increase/ decrease finished stock TOTAL(A) EXPENDITURE Consumption of raw 429689292.0 material & store 9 Manufacturing expenses 55302431 Taxes & duties Administrative expenses Interest & finance charges Depreciation TOTAL(B) 4091580 12940671.82 7453592 2946126 490782880.3 6 65129369.08 7593753.11 17116744.07 9774017.65 3942364 594339128.2 7 16939384.65 1114988.10 15824396.55 0.00 5460513 10363883.55 72621203.05 82985086.60 61093588.27 9826938.08 3502173.11 4176072.25 2320425.65 996238 81915435.36 -4371623 1203772.2 -5575395.2 -105456.60 5460513 10930451.60 21294335.15 10363883.55 14.22 17.77 85.59 32.27 31.13 33.82 15.99 -20.51 -1355.84 26.05 -100 100 51.33 41.49 14.27 526034638 3418411.56 in 4281651 600575514 5100343.92 5602655 74540876 1681932.36 1321004 14.17 49.20 30.85 14.53 31-03-2011 31-03-2012 ABSOLUT PERCENTAG E CHANGE E OF CHANGE
533734700.5 611278512.9 77543812.36 6 2
512423692.9 1 Profit before tax for the 21311007.65 year(A-B) (-)Provision for deferred tax -88784.10 liability 21399791.75 (-)Provision for sales tax 105456.60 liability (-) Provision for taxation 0.00 Profit after taxation (PAT) Add B/f previous year 21294335.15 51326867.90
Balance profit/loss carried to 72621203.05 reserve & surplus INTERPRETATION
1. The comparative income statement of the company reveals that, during the year sales are increased by 74540876 i.e., 14.17% and other receipts also increased by 1681932.36 i.e., 49.2%. 2. While there is increase in sales by 14.17%, the consumption of raw material also increased by 14.22%. 3. Taxes & duties are increased by 85.59% 4. There is a negative results in profit before tax (PBT) of the company i.e., -20.51%. 5. On the whole, overall profitability of the company is not satisfactory.
COMMON SIZE INCOME STATEMENT OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2007 TO 2008 PARTICULARS 31-03-2007 PERCENTA 31-03-2008 GE OF CHANGE 100 11.46 1.46 165084742 9842450.58 0 PERCENTA GE OF CHANGE 100 5.96 0.00
INCOME Sales Other receipts Increase in finished stock TOTAL(A) EXPENDITURE Consumption of raw 62172572.47 material & store Manufacturing expenses 12794469.75 Taxes & duties Administration expenses Interest & financial charges Depreciation Misc expenses Decrease in finished stock TOTAL(B) 19303217 2758430.81 1471658 1907066.50 4090 0.00 67.58 13.91 20.98 2.99 1.59 2.07 0.004 0.00 111692719.7 4 13872935.93 31571594.44 2662990.56 616676 1826842 4090 150843.20 67.66 8.40 19.12 1.61 0.37 1.11 0.002 0.09 92003562 10542580.72 1342058
103888200.7 112.92 2
174927192.5 105.96 8
100411504.5 110.34 3 Profit for the year before 3476696.19 3.78 tax(A-B) Excess provision for 0.00 0.00 taxation of earlier year Provision for deferred tax 0.00 0.00 liability Profit after taxation 3476696.19 3.78 Add B/f previous year 1037461.16 1.13 4.91 Balance profit/loss carried to 4514157.35 reserve & surplus
162398691.8 98.37 7 12528500.71 7.59 -66893.23 443536 12151857.94 4514157.35 16666015.29 -0.04 0.27 7.36 2.73 10.09
INTERPRETATION
1. The common size income statement of the company reveals that, other receipts is
11.46% on sales in 2007 and 5.96% on sales in 2008.

2. There is no change in consumption of raw material comparing on sales i.e.,
67.58% in 2007 and 67.66% in 2008. 3. Profit before tax is also increased from 3.78% on sales to 7.59% on sales during the year. 4. Balance profit carried to balance sheet is also increased from 4.91% on sales to 10.09% on sales during the year. 5. On the whole, overall profitability of the company satisfactory.
COMMON SIZE INCOME STATEMENT OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2008 TO 2009
PARTICULARS INCOME Sales Other receipts Increase in finished stock TOTAL(A) EXPENDITURE
31-03-2008
PERCENTAG 31-03-2009 E OF CHANGE 100 5.67 0.04 105.71 235323873.45 7847939.32 3981781 247153593.77
PERCENTAG E OF CHANGE 100 3.33 1.69 105.03
244225722.08 13846059.16 105203.20 258176984.44
Consumption of raw 170317647 material & store Manufacturing expenses 18251986.27 Taxes & duties Administration expenses Interest & financial charges Depreciation Misc expenses Decrease in finished stock TOTAL(B) 44979966.63 5282272.94 486760.23 1852573 4090 0.00 241175296.07
69.74 7.47 18.42 2.16 0.19 0.76 0.002 0.00 98.75 6.96 0.13
192965699.31 28683619.81 5909210 6828216.66 2654443.92 2699138.85 4090 0.00 239744418.55 7409175.22 0.00
82 12.19 2.51 2.90 1.13 1.15 0.002 0.00 101.88 3.15 0.00
Profit for the year before 17001688.37 tax(A-B) Excess provision for 327575 taxation of earlier year Provision for deferred tax 798596 liability Profit after taxation 15875517.37 Add B/f previous year 15921035.29
0.33 6.5 6.52 13.02
691219 6717956.22 31796552.66 38514508.88
0.29 2.85 13.51 16.37
INTERPRETATION
1. The common size statement of the company reveals that, there is a sound increase in consumption of raw materials from 69.74% to 82% on sales during the year. 2. The above increase is not resulted to increase the sales volume during the year. 3. Manufacturing expenses also increased from 7.47% to 12.19% on sales. 4. There is a decrease in profit before tax (PBT) from 6.96% to 3.15% during the year. 5. Balance profit carried to balance sheet is increased from 13.02% to 16.37% during the year. 6. On the whole, overall profitability of the company satisfactory.
COMMON SIZE INCOME STATEMENT OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2009 TO 2010
31-03-2009
PERCENTAG 31-03-2010 E OF CHANGE 100 3.33 1.69 105.03 307228040.60 8867291.63 1135483 317230815.23
PERCENTAG E OF CHANGE 100 2.88 0.37 103.26
235323873.45 7847939.32 in 3981781 247153593.77
Consumption of raw 192965699.31 material & store Manufacturing expenses 28683619.81 Taxes & duties Administrative expenses Interest & charges Depreciation Misc expenses TOTAL(B) 5909210 6828216.66
82 12.19 2.51 2.90 1.13 1.15 0.002 101.88 3.15 0.29 2.85 0.00 2.85 13.51 16.37
238204911.77 39648256.10 2106623 10964028.87 4281164.47 2857930.01 4090 298067004.22 19163811.01 104912 19058899.01 6246540 12812359.01 38514508.88 51326867.89
77.53 12.91 0.69 3.57 1.39 0.93 0.001 97.02 6.24 0.03 3.2 2.03 4.17 12.54 16.71
finance 2654443.92 2699138.85 4090 239744418.55
Profit before tax for the 7409175.22 year(A-B) (-)Provision for deferred 691219 tax liability 6717956.22 (-) Provision for taxation 0.00 Profit after taxation 6717956.22 (PAT) Add B/f previous year 31796552.66 Balance profit/loss 38514508.88 carried to reserve & surplus
INTERPRETATION
1. The common size income statement of the company reveals that, there is a decrease in other receipts from 3.33% to 2.88% during the year. 2. There is also decrease in consumption of raw material & stores from 82% to 77.53% on sales during the year. 3. Profit before tax (PBT) of the company increased from 3.15% to 6.24% on sales during the year. 4. The balance profit carried to balance sheet remains constant during the year. 5. On the whole, overall profitability of the company satisfactory.
COMMON SIZE INCOME STATEMENT OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2010 TO 2011 PARTICULARS INCOME Sales Other receipts Increase/ decrease finished stock TOTAL(A) EXPENDITURE Consumption of raw 238204911.7 material & store 7 Manufacturing expenses 39648256.10 Taxes & duties Administrative expenses Interest & finance charges Depreciation Misc expenses TOTAL(B) 2106623 10964028.87 4281164.47 2857930.01 4090 77.53 12.91 0.69 3.57 1.39 0.93 0.001 429689292.09 81.68 55302431 4091580 12940671.82 7453592 2946126 0.00 512423692.9 1 21311007.65 -88784.10 21399791.75 105456.60 0.00 21294335.15 51326867.90 72621203.05 10.51 0.78 2.46 1.42 0.56 0.00 97.41 4.05 -0.02 4.07 0.02 0.00 4.05 9.76 13.81 31-03-2010 PERCENTA 31-03-2011 GE OF CHANGE 100 2.88 0.37 526034638 3418411.56 4281651 533734700.5 6 PERCENTA GE OF CHANGE 100 0.65 0.81 101.46
307228040.6 0 8867291.63 in 1135483
317230815.2 103.26 3
298067004.2 97.02 2 Profit before tax for the 19163811.01 6.24 year(A-B) (-)Provision for deferred 104912 0.03 tax liability 19058899.01 3.2 (-)Provision for sale tax 0.00 deferment (-) Provision for taxation 6246540 Profit after taxation (PAT) Add B/f previous year 12812359.01 38514508.88 0.00 2.03 4.17 12.54 16.71
Balance profit/loss carried 51326867.89 to reserve & surplus INTERPRETATION
1. The common size income statement of the company reveals that, there is increase in consumption of raw material & stores from 77.53% to 81.68% on sales. As results in increase of sales volume. 2. Profit before tax (PBT) of the company decreased from 6.24% to 4.05% on sales during the year.
3. Provision for taxation in 2010 is 2.03% on sales but it was nil in 2011.
4. Balance profit carried to balance sheet is decreased from 16.71% to 13.81% during the year. 5. On the whole, overall profitability of the company satisfactory.
COMMON SIZE INCOME STATEMENT OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2011 TO 2012 PARTICULARS 31-03-2011 PERCENTA 31-03-2012 GE OF CHANGE 100 0.65 0.81 600575514 5100343.92 5602655 611278512.9 2 PERCENTA GE OF CHANGE 100 0.85 0.93 101.78
INCOME Sales Other receipts Increase/ decrease finished stock TOTAL(A) 526034638 3418411.56 in 4281651
533734700.5 101.46 6 81.68 10.51 0.78 2.46 1.42 0.56 0.00 97.41 4.05 -0.02 4.07 0.02 0.00 4.05 9.76 13.81
EXPENDITURE Consumption of raw 429689292.0 material & store 9 Manufacturing expenses 55302431 Taxes & duties Administrative expenses Interest & finance charges Depreciation Misc expenses TOTAL(B) 4091580 12940671.82 7453592 2946126
490782880.36 81.718 65129369.08 7593753.11 17116744.07 9774017.65 3942364 0.00 594339128.2 7 16939384.65 1114988.10 15824396.55 0.00 5460513 10363883.55 72621203.05 82985086.60 10.84 1.26 2.85 1.63 0.66 0.00 98.96 2.82 0.19 2.63 0.00 0.91 1.73 12.09 13.82
0.00 512423692.9 1 Profit before tax for the 21311007.65 year(A-B) (-)Provision for deferred -88784.10 tax liability 21399791.75 (-)Provision for sale tax 105456.60 deferment (-) Provision for taxation 0.00 Profit after taxation (PAT) Add B/f previous year 21294335.15 51326867.90
Balance profit/loss carried 72621203.05 to reserve & surplus INTERPRETATION
1. The common size income statement of the company reveals that, there is a no change of percentage in consumption of raw materials & stores during the year. 2. Profit before tax (PBT) of the company decreased from 4.05% to 2.82% on sales during the year. 3. Profit after tax (PAT) also decreased from 4.05% to 1.73% on sales during the year. 4. Balance profit carried to balance sheet is remains unchanged i.e., 13.8% on sales during the year. 5. On the whole, overall profitability of the company satisfactory.
BALANCE SHEET SHOWING TRENDS IN PERCENTAGES OF SAGAR CEMENTS FOR THE YEAR ENDING 31ST MARCH 2007 TO 2012 PARTICULAR 31-03-07 31-03-08 31-03-09 31-03-10 31-03-11 31-03-12 S SOURCES OF FUNDS Share capital Reserve& surplus Secured loans Unsecured loans 100 100 100 100 100 704.37 219.17 0 133.75 0 100 853.19 646.81 0 134.20 0 100 1137.02 871.5 0 134.15 0 100 1608.74 1308.52 0 134.69 0 100 1838.33 1128.93 0 134.69 0
Sale tax deferred 100 liability Provision for 100 deferred tax liability TOTAL 100
188.51
246.89
297.19
381.01
403.97
APPLICATION OF FUNDS Fixed assets Investments Deposits 100 100 100 125.51 50.45 301.26 303.02 136.13 50.45 256.05 465.03 131.25 50.45 279.12 626.67 142.30 50.45 311.50 858.76 228.93 50.45 412.497 749.41
Current 100 assets,loans& advances Preliminary and 100 pre-operative expenses TOTAL 100
50
25
188.51
246.89
297.19
381.01
403.97
Note Assuming the values of base year i.e., 2006 as 100%
FINDINGS
On the basis of the analysis and interpretation of various financial statements, the following conclusions are made. 1. The profitability position of the company is good and it can be improved by looking into the factors contributing to the companys profits. 2. The sales of the company is not improved with the increase of consumption of raw material in the year 2008-2009. 3. The net profit has been increasing continuously from 2008 to 2012. 4. The overall profits are distributed to reserves and surplus. 5. The current assets & loans and advances have been continuously increasing from 2010 to 2012. 6. The total asset of the company has been increasing continuously. 7. There is no increase in the value of investments from 2008 to 2012. 8. The reserves & surplus of the company increasing continuously. On the whole, the performance of SAGAR CEMENTS is good, but a lot of improvement is required especially in utilizing funds, investments, amendments in credit management policies, etc. the company has to achieve its set targets by striving for its fulfillment.
SUGGESTIONS
On the basis of the analysis and interpretation of various financial statements, the following suggestions are made. 1. Though the financial position is considered to be strong, the company is advised to maintain consistency in improving its reserve capacity. 2. It is advised that the idle funds and investments should be effectively utilized to have a good profitable position. 3. The company should reduce cost of production and spend more on marketing the products to maximize their sales in indigenous market. 4. The company Investments are very less so it is suggested to increase its investments 5. It is suggested to improve the operating income such that they can maintain high gross profit margin. 6. It is suggested to reduce the operating expenses in order to increase the net profit margin.
CONCLUSIONS
So the overall financial position is satisfied. The reserves & surplus also increased it indicates the companies enabling to use reserves and surplus efficiently.
BIBLIOGRAPHY
1) FINANCIAL MANAGEMENT - Dr. S.N. Maheswari (Sultan chand publishers) 2) FINANCIAL MANAGEMENT - I.M. Pandey (Vikas Publishers) 3) ACCOUNTING III - S. P. Jain (Kalyani publishers) 4) FINANCIAL MANAGEMENT - Khan & Jain (TMH, Tata Mc Graw Hill) 5) MANAGEMENT ACCOUNTING - R.K. Sharma & Shashi K. Guptha (Kalyani publishers) website www.scridb.com

Sagar Cement - Financial STMT Analysis

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Sagar Cement - Financial STMT Analysis

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INTRODUCTION

THE FOLLOWING ARE THE OBJECTIVES OF THE STUDY

financial statements analysis.

Range 62-67 17-25 3-8 3-4 3-4 1-3 1-3

Industry Structure and Development:

51 Nos 99Nos 64.8mt Rs.10,000 Crores Over 1.25 Lakhs

INTEGRITY AND HONESTY

+ Runways, concrete Roads, Bridges etc.

THEORETICAL FRAME WORK

LIMITATIONS OF FINANCIAL STATEMENTS:

FINANCIAL STATEMENTS ANALYSIS:

TYPES OF FINANCIAL ANALYSIS:

Limitations of Comparative Financial Statements

liability Provision for deferred 1987112 tax liability TOTAL 97712184.9

3540603.65 0 -687955 27413822.05 -4090 30262380.7

8.47 0 -15 53.47 -50 30.97

liability Provision for deferred 2678331 tax liability TOTAL 127974565.61

operative expenses TOTAL

23431000 51326867.89 36200447.38 13830206 deferred 26473735.4

23431000 72621203.04 54353221.01 17810745 26579192

0 21294335.15 18152773.63 3980539 105456.6

0 41.49 50.15 28.78 0.4

Provision for deferred 2783243 tax liability TOTAL 154045499.67

Current assets, loans& 106036441.67 advances Preliminiary & pre- 0

operative expenses TOTAL 154045499.67 197489819.95 43444320.28 28.20

ABSOLUTE PERCENTAGE CHANGE OF CHANGE 0 14.27 -13.72 44.25 0 41.38

23431000 82985086.60 46893584.12 25692270.90 26579192 3809447

0 10363883.56 -7459636.89 7881525.9 0 1114988.1

209390580.6 2 76281546.5 27000 6277902

assets, 145305982.95 126804132.12 -18501850.83 -12.73 197489819.9 5 209390580.6 2 11900760.67 60.26

loans& advances TOTAL

liability Provision for deferred 3809447 tax liability TOTAL

209390580.62 218244340.11 8853759.49 98043419.75 27000 7655913 21761873.25 0 1378011 -14286124.76

APPLICATION OF FUNDS Fixed assets 76281546.5 Investments Deposits 27000 6277902

Current assets, loans& 126804132.12 112518007.36 advances TOTAL

209390580.62 218244340.11 8853759.49

31-03-2007 PERCENTAGE 31-03-2008 OF CHANGE

Sales tax deferred 19734229

assets, 16920533.13 32.64

39491156.48 54.89 12270 0.02

reserves capacity is very good. Because percentage of in

reserves to that of total liabilities is 8.7% in 2007, it increased to 22.13% 2008.

PERCENTA GE CHANGE 23.98 32.54 9.32 5.12 27.01 2.03 OF

Sales tax deferred 23281709.48 for 1188516 tax 71941563.48

assets to that of total assets is 42.89% in 2008 and 42.80% in 2009.

PERCENTAGE OF CHANGE 23.98 9.32 5.12 27.01 2.03

PERCENTAGE OF CHANGE 18.31 30.10 20.99 7.81 20.69 2.1

23431000 38514508.88 26867178.33 10000000 26483547.40 2678331

Sales tax deferred 26393601.4 for 1987112 tax 97712184.9

42.80 0.03 4.69

45360574.65 27000 3896967 78685933.96 4090

35.44 0.02 3.04 61.49 0.01

assets, 51272111.91 52.47 0.01

loans& advances Preliminary & 8180 pre-operative expenses TOTAL

3. Companys reserve capacity is very good. Because percentage of Reserves &

18.31 30.10 20.99 7.81 20.69

23431000 51326867.89 36200447.38 13830206 26473735.4

15.21 33.32 23.5 8.98 17.19

35.44 0.02 3.04 61.49

43734109 27000 4247949

28.39 0.02 2.76

loans& advances TOTAL 127974565.6 1 100 154045499.6 7 100