SUBMITTED TO:

Rai Imtiaz Hussain

SUBMITTED BY:

Sadaf Ambreen 607

BBA (Hons) 8th
Session 2006-10

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 DEDICATION

I dedicate my internship report of TASTY SWEET CORN to my

Respectable parents

And

Honorable teachers

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 ACKNOWLEDGEMENT
By the Grace of Almighty, the most Merciful, the most Beneficial, I'm today submitting
my internship report, at the end of my first pragmatic experience and I'm glad to have it
with ROYAL ENTERPRISES. Thirst of learning is inside you, and whatever the
environment, if you're willing to learn, you do. At ROYAL ENTERPRISES, I had a new,
challenging, yet a perfect environment to learn. My parents' prayers and their teachings
were always with me and hereby I will like to take this opportunity to show my gratitude
to all those who made my internship an adventurous outwit.
.
Here I am, from more professional and rather corporate environment of Royal
Enterprises Garden Town Lahore. I never knew what it all going to be. As I enter the
branch, it took me a minute to realize that the person sitting in the half fortified walls is
the manager. Maybe I was expecting him in a glass sheeted room. At a glance, I grasped
the interesting personality of the manager and today at the end of my internship; he’s one
of the persons I’ll always remember. Sir whatever I learnt from you is always going to be
respected, no matter whatever business field I choose. Those tips are always in my
memory bag.
Despite of the most hectic schedule, Mr.Zahid Mirza helped me so much. I'm
really grateful to him for clarifying my concepts and making me learn from his
experience. Whatever I learnt from him will definitely help me in my upcoming study
and the professional life ahead. Thank you so much for being so co-operative and so
helpful every time.
In the end, I'll like to thank all my fellow internees, for their unconditional
support and help in making me learn in a good environment.
Sadaf Ambreen

CONTENTS OF REPORT

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 INTERNSHIP LETTER
 INTRODUCTION TO THE STORY OF CORN
• CORN HISTORY
• ORIGIN
• KINDS OF CORN
• USES OF CORN

 OBJECTIVE OF STUDYING ORGANISATION

 OVERVIEW OF THE ORGANISATION
• BRIEF HISTORY
• NATURE OF THE ORGANISATION
• OUR GOAL
• BUSINESS VOLUME
• NUMBER OF EMPLOYEES
• PRODUCT LINE

 ORGANISATIONAL STRUCTURE
• MAIN OFFICES
• COMMENTS ON THE ORGANISATION STRUCTURE

 STRUCTURE OF FINANCE DEPARTMENT

• NUMBER OF EMPLOYEES IN FINANCE
DEPARTMENT
 FUNCTIONS OF FINANCE
DEPARTMENT
• ACCOUNTING SYSTEM OF THE
ORGANISATION
• FINANCE SYSTEM OF THE
ORGANISATION

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 • USE OF ELECTRONIC DATA IN
DECISION MAKING
• ALLOCATION OF FUNDS

 CRITICAL ANALYSIS
• RATIO ANALYSIS
• ADVANTAGE OF RATIO ANALYSIS
• LIMITATIONS OF RATIO ANALYSIS
• LIQUIDITY RATIOS
• DEBT PAYING ABILITY RATIOS
• ACTIVITY RATIOS
• PROFITABILITY RATIOS
 FUTURE PROSPECTS OF THE ORGANISATION
 SWOT ANALYSIS
 CONSLCUSION AND RECOMMENDATIONS
 APPENDIX
 ANNEXES

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CORN HISTORY:

Corn as we know it today would not exist if it weren't for the humans that
cultivated and developed it. It is a human invention, a plant that does not exist
naturally in the wild. It can only survive if planted and protected by humans.

Scientists believe people living in central Mexico developed corn at least 7000
years ago. It was started from a wild grass called teosinte. Teosinte looked very
different from our corn today. The kernels were small and were not placed
close together like kernels on the husked ear of modern corn. Also known
as maize Indians throughout North and South America, eventually depended
upon this crop for much of their food.

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From Mexico maize spread north into the Southwestern United States and
south down the coast to Peru. About 1000 years ago, as Indian people migrated
north to the eastern woodlands of present day North America, they brought
corn with them.

When Europeans like Columbus made contact with people living in North and
South America, corn was a major part of the diet of most native people. When
Columbus "discovered" America, he also discovered corn. But up to this time,
people living in Europe did not know about corn.

The first Thanksgiving was held in 1621. While sweet potatoes, cranberry
sauce and pumpkin pie were not on the menu, Indian corn certainly would have
been.

ORIGIN:
For western civilization, the story of corn began in 1492 when Columbus's
men discovered this new grain in Cuba. An American native, it was exported to
Europe rather than being imported, as were other major grains.

Like most early history, there is some uncertainty as to when corn first went
to Europe. Some say it went back with Columbus to Spain, while others report
that it was not returned to Spain until the second visit of Columbus.

The word "corn" has many different meanings depending on what country
you are in. Corn in the United States is also called maize or Indian corn. In
some countries, corn means the leading crop grown in a certain district. Corn in
England means wheat; in Scotland and Ireland, it refers to oats. Corn
mentioned in the Bible probably refers to wheat or barley.

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 At first, corn was only a garden curiosity in Europe, but it soon began to be
recognized as a valuable food crop. Within a few years, it spread throughout
France, Italy, and all of southeastern Europe and northern Africa. By 1575, it
was making its way into western China, and had become important in the
Philippines and the East Indies.

Although corn is indigenous to the western hemisphere, its exact birthplace

is far less certain. Archeological evidence of corn's early presence in the
western hemisphere was identified from corn pollen grain considered to be
80,000 years old obtained from drill cores 200 feet below Mexico City.
Another archeological study of the bat caves in New Mexico revealed corncobs
that were 5,600 years old by radiocarbon determination. Most historians believe
corn was domesticated in the Tehuacan Valley of Mexico. The original wild
form has long been extinct.

Evidence suggests that cultivated corn arose through natural crossings,

perhaps first with gamagrass to yield teosinte and then possibly with back-
crossing of teosinte to primitive maize to produce modern races. There are
numerous theories as to the ancestors of modern corn and many scientific
articles and books have been written on the subject. Corn is perhaps the most
completely domesticated of all field crops. Its perpetuation for centuries has
depended wholly on the care of man. It could not have existed as a wild plant in
its present form.

Corn is often classified as dent corn, flint corn, flour corn, popcorn, sweet corn,
waxy corn, and pod corn. The remainder of this discussion will be concerned
only with dent corn, which is the major type cultivated in the United States.

Corn was the most important cultivated plant in ancient times in America.
Early North American expeditions show that the corn-growing area ex tended

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from southern North Dakota and both sides of the lower St. Lawrence Valley
southward to northern Argentina and Chile. It extended west ward to the
middle of Kansas and Nebraska, and an important lobe of the Mexican area
extended northward to Arizona, New Mexico and southern Colorado. It was
also an important crop in the high valleys of the Andes in South America.

The great variability of the corn plant led to the selection of numerous
widely adapted varieties which hardly resembled one another. The plant may
have ranged from no more than a couple of feet tall to over 20 feet. It was not
like the uniform sized plant that most people know today. For the Aztecs,
Mayas, Incas and various Pueblo dwellers of the southwestern United States,
corn growing took precedence over all other activities.

The principal role of the corn plant during the 19th century was closely tied
to the development of the Midwest. In the movement westward, corn found its
major home in the woodland clearings and grasslands of Ohio, Indiana, Illinois,
Iowa, and adjacent states. These were places where it had not been grown
widely in prehistoric times.

As early as 1880, the United States grew over 62 million acres of corn. By
1900, this figure had reached approximately 95 million acres; by 1910, it was
over 100 million acres. The highest acreage ever recorded in the United States
was 111 million acres in 1917.

From the beginning of records in the 1880s, through the mid 1930s, there
was no significant increase in the national average corn yield. Yields during the

1920s and 1930s were no higher than those produced as a national average
in the late 1800S.

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 It was not until the vast technological advances in the early 1940s that corn
yields started to show significant yield increases. Prior to this time, the highest

U.S. average yield was recorded in 1906 at 31.7 bushels per acre. Following
moderate yield increases in the 1940s and 1950s, yields shot up in the 1960s
and early 1970s to a national average of 109.5 bushels per acre in 1979. In

2000, US farmers planted over 79 million acres of corn. More than 40% of
the world's corn is produced in the United States.

Total acreage is now less than in earlier years, but planting has increased in
the more favorable areas of the Corn Belt. Iowa is normally the leading corn
producing state, followed closely by Illinois. As early as 1910, Iowa had 8.5
million acres of corn, which averaged nearly 40 bushels per acre. In 1935, Iowa
had 9.7 million acres of corn, averaging 39 bushels per acre. In 1960, Iowa
averaged 62 bushels per acre on nearly 12.5 million acres. In 2000, Iowa
farmers averaged 145 bushels per acre on more than 12 million acres. The
highest all time record corn acreage in Iowa was 14.4 million acres in 1980.

Corn and soybeans form a major base of the Iowa economy. The
combination of favorable soils, weather, and management know-how for the
production of these two crops is rivaled by few other places in the world.

Although few people are directly involved in the production of these major
crops, many jobs are associated with this industry. Industries involved in crop
processing, marketing, production of farm machinery and other farm inputs
exist because of our ability to grow crops in Iowa. Massive livestock industries
also depend on feed produced from Iowa soils.

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 KINDS OF CORN:
Today there are many kinds of corn. The most common types are flint, dent,
sweet and of course popcorn.

Flint corn, also known as Indian corn, has a hard outer

shell and kernels with a range of colors from white to red. Today, most flint
corn is grown in Central and South America.

Dent corn, often called "field corn" is often used as livestock

feed. It is also the main kind of corn used when making industrial products and various
foods. It can be either white or yellow.

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 Sweet corn is often eaten on the cob or it can be canned or
frozen. Sweet corn is seldom processed into feed or flour. Sweet corn gets
its name because it contains more sugar than other types of corn. Popcorn, a
type of flint corn, has a soft starchy center that is covered by a very hard shell. When
popcorn is heated the natural moisture inside the kernel turns to steam that builds up
enough pressure for the kernel to explode. When the kernel explodes the white
starchy mass that you like to eat forms.

USES OF CORN:
Corn was an important part of the diet of many Indian groups. They also used all parts of
the corn plant. The husks could be braided and woven to make masks, moccasins,
sleeping mats, baskets or cornhusk dolls. Corncobs could be used for fuel, for game darts
or for ceremonial use.

During the mid 1960s, about 75 percent of the corn was fed to livestock, 13
percent was exported, and the remainder went into human food and industrial
products. By 2000, the relative amount of corn fed to livestock had decreased
to 60 percent, 22 percent be exported, 6 percent was used for High-Fructose

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Corn Sweetener, 6 percent was processed for ethanol, and 6 percent went into
other products.

Between 90 and 95 percent of the crop is harvested for grain; the remaining
5 to 10 percent is grown for silage. Of the corn fed to livestock in 1960, about
40 percent went to hogs, 20 percent to poultry, 30 percent to cattle on feed and
milk cows, and 10 percent to other types of livestock. By 2000, these amounts

had shifted to 29 percent to cattle on feed, 29 percent to poultry, 24 percent to

hogs, 16 percent to dairy cattle, and 2 percent to other types of livestock.

One reference lists over 500 different uses for corn. Corn is a component of
canned corn, baby food, hominy, mush, puddings, tamales, and many more
human foods.

Some industrial uses of corn include filler for plastics, packing materials,
insulating materials, adhesives, chemicals, explosives, paint, paste, abrasives,
dyes, insecticides, pharmaceuticals, organic acids, solvents, rayon, antifreeze,
soaps, and many more.

Corn also is used as the major study plant for many academic disciplines
such as genetics, physiology, soil fertility and biochemistry. It is doubtful that
any other plant has been studied as extensively as has the corn plant.

A bushel of shelled corn weighs 56 pounds.

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There are many uses for corn today as well. Just as Indians depended on corn as
a major part of their diet it would be difficult for any American today to live
without corn. Fabrics used to make your clothing are strengthened by
Cornstarch. The chickens that laid the eggs you had for breakfast were fed
corn. Many of the soft drinks you enjoy are sweetened with corn syrup.

Ethanol is made from corn. The car that carries you to and from school may be
powered by fuel containing ethanol. Corn is also used in such products as glue,
Shoe polish, aspirin, ink, marshmallows, ice cream and cosmetics. New ways
of using corn are being developed every day. Our only limitation is our own
imagination.

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OBJECTIVE OF STUDYING ORGANISATION:
As part of the academic requirement for completing BBA (Finance) Bachelor
of Business Administration of the students are required to under go internship
with an organization. The internship is to serve the purpose of acquainting the
students with the practice of knowledge of the discipline of banking
administration.
This report is basically about internationally and popularly known as Tasty
Corn which belongs to Tasty Sweet corn UK - a licensed Food Stuff Importer /
Exporter / Wholesaler / Retailer based in Manchester, United Kingdom. It
offers different products of services to its customers.

The main objectives of the study in hand is together relevant information to

compile internship report on
• To observe, analyze and interpret the relevant data competently and in a
useful manner.

• To work practically in an organization.

• To develop interpersonal communication.

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BRIEF HISTORY:
Internationally and popularly known as Tasty Corn which belongs to Tasty
Sweet corn UK - a licensed Food Stuff Importer / Exporter / Wholesaler /
Retailer based in Manchester, United Kingdom.
It was established with the name of MAGIC CORN on August 14, 2004 in
Lahore and Karachi. After 1 year it was extended to Islamabad and Rawalpindi,
then to Islamabad and then it further extended its operations in Gujranwala,
Gujrat, Faisalabad and Multan.
The MAGIC CORN was actually imported from Malaysia. Due to increasing
prices, in order to cut down the expenses another firm with the name of
“ROYAL ENTERPRISES” was established in 2007 and terminated its links
with MAGIC CORN in Karachi and Islamabad. It restricted its operations in
Punjab only.
Later, In the year It assigned an agreement with the TASTY SWEET
CORN(Registered in UK) for a joint venture and also started operations in
Karachi .Now TASTY SWEET CORN UK and ROYAL ENTERPRISES work
as same company and distribute the profits equally.

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TASTY SWEET CORN is responsible for operations in London and
Manchester as well as it signed agreement with sweet corn company world
over and sends containers of sweet corn to Pakistan where Royal Enterprises
sells the sweet corn with the Brand name “TASTY SWEET CORN”.

NATURE OF THE ORGANISATION:

TASTY SWEET CORN imports non-cut, whole kernel, sweet and juicy corn
from Malaysia, India and China. It doesn’t restrict itself to one or two countries
but it keep on searching excellent and affordable sweet corn in different
countries. It is committed to import only non-cut, whole kernel sweet corn
which is cut and incomplete kernel corn, due to which its juice is wasted. While
non-cut kernel retains the juice, so the customer enjoys actual flavor of sweet
corn.
The company sells sweet corn in frozen conditions to other corn selling traders
as well. It also sells sweet corn at its outlets in Lahore, Gujranwala and
Karachi. The UK chapter has also opened many counters in London and
Manchester. It is also intending to open its outlets in UAE and Saudi Arabia
this year.
In the outlets counters have been installed at the front gates or inside big
shopping centers and super markets where well-active sales man wearing
companies uniform, sell the corn to the customers.
Corn is not sold as cobs but it is sold in the form of isolated corn kernels. As it
is already frozen so when it is steamed in an electric steamer it absorbs water

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vapors and become hot and juicy. Then flavors are added after filling it in the
Thermo pore cups and served to the customer.
In summary, TASTY SWEET CORN is a profit oriented internationally
operated joint venture (Multinational Company) with intention of selling
Qualitative products. It doesn’t want to earn profit by sacrificing the quality of
product. It strictly believes in first quality then profit.

Our Goal

We are committed to continuously build our presence and strengthen

our position in the market by delivering quality products.

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BUSINESS VOLUME:
Company imports a 20 footer container (reefer) in which 12,500 kg sweet corn
bags (each bag of 2 kg) are filled. This container is usually sold within 6 to 7
months.Sellings is relatively slow in summer but is fast in winter. Being the hot
and spicy product, it is liked by customers in winters. Usually children and
women but it.
It is sold in many shopping centers of Lahore city like Al-Fatah, Pace, city
tower and hyper star etc.
In Lahore, there are about 15 outlets while in Gujranwala there are 2, 1 in
Faisalabad and few in Karachi. In the near future it will open its more outlets in
Rawalpindi, Islamabad and other cities of Pakistan.

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In Manchester (UK) it has 32 outlets while in London there are 17 outlets.
Some of the outlets are directly controlled by company while other work on
franchise basis.
NUMBER OF EMPLOYEES:
The senior most are 3 Directors which are also the company owners. One
controls the operations in UK, other in Lahore and 3rd in Karachi.
In Lahore and UK there are 2 business managers which are responsible for
sales and marketing and expansion projects. The finance department is directly
controlled by director in UK and Lahore, however each finance department in
both countries is having an accountant and a financial assistant which keeps
the record daily sales, record of store department is kept by storekeeper which
also makes inventory and is responsible for issuing goods and services. Outside
the office each outlet in the city is controlled by a salesman, sometimes in busy
shopping centres, there are 2 salesmen, so overall there is a team of more than
20 salesmen in Lahore and about 50 in UK.
There are 5 salesmen working in other cities. In offices there is also custodian
staff and drivers to pick and drop the inventory from cold storage office and
outlets.

PRODUCT LINE:

Grab a Grill

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360 degree roller rotation prevents residue buildup, while individual roller
heating elements ensure heating consistency. Removable drip pan makes for
easy cleaning.

Crispy Waff
Dual grid baker let you serve crisp, golden brown waffles with convenience
and ease. Simply fill, then push the timer. Precise temperature sensors ensure
uniform baking on both sides.

Taste a Cup
Whole kernel corn is most suitable stream in this streamer pot. Every kernel
will cook to its sweet, succulent best. With accurate temputure controller corns
can be steam at perfect temputure to achieve it juicy level.

Get a Bite
Fresh corn will stream to perfection in this streamer pot. Corn on the cob will
cook to its sweet, succulent best. Vented tempered glass lid and heavy gauge
stainless steel streamer rack with tri-ply encapsulated base.

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 Slurp a Juz
Tasty slush drink vending machine is one of the most easy maintain, refill,
clean equipment. Supply with 20 over flavors of nutritious syrup, this is the
best choice for frozen drink business.

Drink a Way
Double or multiple compartment dispensers delivers innovative features that
save your time and make you more juice profits. Faster and better mixing with
the high velocity, vortex injection stay clean valves assures consistently perfect
juice.

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MAIN OFFICES:

Tasty Sweet Corn

32- 34 Duncan Street
Salford
M5 3SQ
Tel: 07832 293 523 // 07932 533 013

Royal Enterprises
BB-5, Central Plaza

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Barkat Market
Garden Town Lahore
Tel: 0300-4198243

COMMENTS ON THE ORGANISATION STRUCTURE:

Due to globalization and adaptation of advanced technology it is very
compulsory for any organization to adopt these amendments. Company is
focusing on this strategy and is updating his system according to current era
requirements and to facilitate customers so that it can compete and stay in
market.

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NUMBER OF EMPLOYESS IN FINANCE DEPARTMENT:
There are 5 to 6 employees working in three different offices of the firm
finance department. In UK office as an accountant and assistant.
Similarly Lahore office also has an accountant and his assistant while Karachi
office has an account assistant.

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Main financial operations are carried out in UK and in Lahore while Karachi
office just keeps records of limited sales and finances for paying different
government duties while clearing the container.
Mr.Zahid Mirza is very competent due to many years of experience in different
finance company in Pakistan and Dubai and currently working in Royal
Enterprises in finance department.

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ACCOUNTING SYSTEM OF ORGANISATION:
Accounts of the company are not kept in a typical manners described in the
account book.
However a cash book is usually maintained with daily income and expense
record.

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Each day sales from different outlets and different companies are recorded in
the cash book and day-to day expenses including rentals, costs and office plus
counter expenses are recorded.
The cashbook is not only maintained manually but also its record is kept in
computer. At the end of the month a summary of the sales and expenses is
prepared when a 20 footer container is sold then an overall summary of
receivables and payables amount is made giving the difference of sales and
expenses.
An example of this summary after seeing a whole container of corn during the
months of my internship was prepared which is attached as annexes.
(Payments and receipts)
FINANCE SYSTEM OF ORGANISATION:
Initially to start the company capital amount was spent by Mr. Mohammad Ali
(Director in Karachi).Later the director of UK (TASTY SWEET CORN), Mr.
Suhail Wasti entered in the partnership by investing in the form of counters
made in the factory which were equivalent to certain amounts need for
partnership. Third partner Mr. Mohammad Ishaq Khan is working as director
operations so his investment is relatively lesser but in the form of managing

operations exceeds than other partners. Once the first container of corn was
sold, it generates enough amounts to be recycled for import of next container.
Thus in this way, the finance generated by initial container is continuously
being recycled to run day to day expenses of the company.
Use of Electronic Data in Decision Making:

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 The Office works mainly on the basic computerized data system
for keeping the record of daily inventory issued to the counters, sale of corn
and use of the inventory items, daily sales report is generated by the computer.
Example:
A copy of daily sales is attached in order to keep the record. With
the help of this daily sales report, calculations are done for consumption of
goods at each counter. At the end of the month an overall report of the sales
and consumption is generated by the computer. The necessary software needed
for all such records is already installed in computer by an efficient data
recording n programming company with office in Hafeez Center Lahore.
This company takes care of any repair of hardware and replacement of software
for smooth running of the company business.
ALLOCATION OF FUNDS:
Funds are allocated for purchasing a number of items of inventory related to
sales of corn. For example: Spices, Margrine, Thermo por cups, pouches,
cleaning equipment etc.Certain funds are also allocated for wear and tear of
outlets which are regularly being repaired by carpenters and factory engineers.
For purchase of electric equipments like steamer and for replacement of
steamer element, Thermostat and tube lights bulbs etc, special7 funds are
allocated when needed.

Funds allocation is done on monthly basis for paying monthly rents of outlets
and office along with payment of utility bills specially electricity bills. Cold
storage is also paid every month while repair of freezers is done whenever it
gets out of order.
Funds are allocated for transport expenses in the form of fuel charges for
supervisors, managers, and accountant and company directors. Fuel charges of

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company goods from cold storage to office are also borne by company .When
container arrives at Karachi port, and then special funds are allocated to pay the
general sales tax, income tax and port duties for clearance of containers. Then
container is transported to Lahore for storing sweet corn in cold storage. For
opening of letter of credit by Askari Bank for import of container heavy funds
are allocated which are kept in company accounts and are paid to the other
party abroad after receiving the documents of container.

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 CRITICAL ANALYSIS
Ratio Analysis

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Ratio analysis is the process of determining and presenting the relationship of
items and group of items in the statements.

ADVANTAGE OF RATIO ANALYSIS

1. Helpful in analysis of Financial Statements.

2. Helpful in comparative Study.

3. Helpful in locating the weak spots of the business.

4. Helpful in Forecasting.

5. Estimate about the trend of the business.

6. Fixation of ideal Standards.

7. Effective Control.

8. Study of Financial Soundness.

LIMITATIONS OF RATIO ANALYSIS

1. Comparison not possible if different firms adopt different

accounting policies.

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 2. Ratio analysis becomes less effective due to price level
changes.

3. Ratio may be misleading in the absence of absolute data.

4. Limited use of a single data.

5. Lack of proper standards.

6. False accounting data gives false ratio.

7. Ratios alone are not adequate for proper conclusions.

8. Effect of personal ability and bias of the analyst

A. LIQUIDITY RATIOS

The current ratio, one of the most commonly cited financial ratios, measures
the firm’s ability to meet its short-term obligations. It is expressed as follows

CurrentAss ets
Current ratio =
CurrentLia bilities

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 The current ratios of ROYAL ENTERPRISES is given in the table .

ROYAL ENTERPRISES
Liquidity Ratios Analysis
2005 2006 2007 2008 2009
Current Ratio 16.41 12.81 9.44 7.86 11.63
25900918 33249685 40711661 51568382 58084028
Current Assets 5 2 7 2 0
Current Liabilities 15786968 25950444 43105569 65578519 49960560

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 LIQUIDITY RATIOS

18.00 16.41
16.00 Current Ratio
14.00 12.81
11.63
12.00
9.44
10.00 7.86
8.00
6.00
4.00
2.00
0.00
2005 2006 2007 2008 2009
YEARS

Generally, the higher the current ratio, the more the firm is considered to be. A
current ratio of 2 is occasionally cited as acceptable, but a value’s acceptability
depends on the industry in which the firm operates. For example, a current ratio
of 1 would be considered acceptable for ROYAL ENTERPRISES utility but
might be unacceptable for manufacturing firm
Current assets in 2005 are Rs.259009185 and current liabilities in 2005 are
Rs.15786968 due to which the current ratio in 2005 is 16.41. Current ratio in
2006 is 12.81 with decrement of 3.59 when current assets are Rs.332496852
and current liabilities become Rs.25950444. In 2007 current assets are
Rs.407116617 and current liabilities becomes Rs.43105569 which resulting the
current ratio 9.44 with decrement of 3.37. Current assets go to Rs.515683822
and current liabilities become Rs.65578519 in 2008 and causes current ratio
7.86 in 2008 with decrement of 1.58.In 2009 the current ratio becomes 11.63
with increment of 3.76 because the current assets in 2009 are Rs.580840280
and current liabilities becomes Rs.49960560

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 (CurrentAss et − Inventory )
Acid ratio =
CurrentLia bilities

ROYAL ENTERPRISES
Liquidity Ratios Analysis
2005 2006 2007 2008 2009
Acid test ratio 16.41 12.81 9.44 7.86 11.63
25900918 33249685 40711661 51568382
Current Assets 5 2 7 2 580840280
Current Liabilities 15786968 25950444 43105569 65578519 49960560

LIQUIDITY RATIOS

18.00 16.41 Acid test

16.00 ratio
14.00 12.81
11.63
12.00
9.44
10.00 7.86
8.00
6.00
4.00
2.00
0.00
2005 2006 2007 2008 2009
YEARS

A quick ratio of 1 or greater is occasionally recommended, but as with current

ratio, what value is acceptable depends largely on the industry. Quick ratio
provides a better measure of overall liquidity when the inventory of the firm
can not be easily converted into cash. If inventory is liquid current ratio is
preferred measure of liquidity Acid test ratio

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 Current assets in 2005 are Rs.259009185 and current liabilities in 2005 are
Rs.15786968 due to which the quick ratio in 2005 is 16.41. Quick ratio in 2006
is 12.81 with decrement of 3.59 when current assets are Rs.332496852 and
current liabilities become Rs.25950444. In 2007 current assets are
Rs.407116617 and current liabilities becomes Rs.43105569 which resulting the
quick ratio 9.44 with decrement of 3.37. Current assets go to Rs.515683822 and
current liabilities become Rs.65578519 in 2008 and causes quick ratio 7.86 in
2008 with decrement of 1.58.In 2009 the quick ratio becomes 11.63 with
increment of 3.76 because the current assets in 2009 are Rs.580840280 and
current liabilities becomes Rs.49960560

Net Working Capital = current assets – current liabilities

ROYAL ENTERPRISES
Liquidity Ratios Analysis
2005 2006 2007 2008 2009
Net working 24322221 30654640 36401104 45010530 53087972
capital 7 8 8 3 0
25900918 33249685 40711661 51568382 58084028
Current Assets 5 2 7 2 0
Current Liabilities 15786968 25950444 43105569 65578519 49960560

42
 AMOUNT
LIQUIDITY RATIOS

600000000 530879720
Net working
500000000 450105303 Capital
400000000 364011048
306546408
300000000
243222217
200000000
100000000
0
2005 2006 2007 2008 2009
YEARS

Current assets in 2005 are Rs.259009185 and current liabilities in 2005 are
Rs.15786968 due to which the net working capital in 2005 is Rs.243222217.
Net working capital in 2006 is Rs.306546408 with increment of Rs.63324191
when current assets are Rs.332496852 and current liabilities become
Rs.25950444. In 2007 current assets are Rs.407116617 and current liabilities
becomes Rs.43105569 which resulting the net working capital Rs.364011048
with increment of Rs.57464640. Current assets go to Rs.515683822 and current
liabilities become Rs.65578519 in 2008 and causes net working capital
Rs.450105303 in 2008 with increment of Rs.86094255.In 2009 the net working
capital becomes Rs.530879720 with increment of Rs.80774417 because the
current assets in 2009 are Rs.580840280 and current liabilities becomes
Rs.49960560

43
 B. Debt Paying Ability Ratios
totalliabi lities
Debt/equity ratio = shareholde r ' sequity

ROYAL ENTERPRISES
Debt Ratios Analysis
2005 2006 2007 2008 2009
Debt / equity ratio 14.70 15.02 13.18 10.41 11.56
25524863 32538068 39345682 49874556 57084486
Total liabilities 2 1 0 8 7
Share capital and
reserves 17364031 21668270 29863387 47890938 49395663

DEBT RATIOS

16.00 14.70 15.02

14.00 13.18 Debt / equity ratio
11.56
RATIOS

12.00 10.41
10.00
8.00
6.00
4.00
2.00
0.00
2005 2006 2007 2008 2009
YEARS

44
Share capital and reserves in 2005 are Rs.17364031 and total liabilities in 2005
are Rs.255248632 due to which the debt / equity ratio in 2005 is 14.70. Debt /
equity ratio in 2006 is 15.02 with increment of 0.32 when share capital and
reserves are Rs.21668270 and total liabilities become Rs.325380681. In 2007
share capital and reserves go up to Rs.29863387 and total liabilities becomes
Rs.393456820 which resulting the debt / equity ratio 13.18 with decrement of
1.84. Share capital and reserves increase to Rs.47890938 and total liabilities
becomes Rs.498745568 in 2008 and causes debt / equity ratio 10.41 in 2008
with decrement of 2.76.In 2009 the debt / equity ratio becomes 11.56 with
increment of 1.14 because the share capital and reserves in 2009 are
Rs.49395663 and total liabilities becomes Rs.570844867.

45
C. Activity Ratios
netsales
Total asset turn over= averagetot alassets

ROYAL ENTERPRISES
Activity Ratios Analysis
2005 2006 2007 2008 2009
Total asset
turnover 3.39 5.81 7.79 7.68 8.56
Net Revenue 9233881 20158860 32991603 41962131 53097381
27261266 34704895 42332020 54663650 62024053
Total Assets 3 1 7 6 0

ACTIVITY RATIOS

9.00 8.56
7.79 7.68 Total asset turnover
8.00
7.00
RATIOS

5.81
6.00
5.00
4.00 3.39
3.00
2.00
1.00
0.00
2005 2006 2007 2008 2009
YEARS

Total assets in 2005 are Rs.272612663 and the net revenue in 2005 is
Rs.9233881 due to which the total asset turnover in 2005 is 3.39. Total asset
turnover in 2006 is 5.81 with increment of 2.42 when total are Rs.347048951

46
and the net revenue becomes Rs.20158860. In 2007 total assets go up to
Rs.423320207 and the net revenue becomes Rs.32991603 which resulting the
total asset turnover 7.79 with increment of 1.98. Total assets increase to
Rs.546636506 and the net revenue becomes Rs.41962131 in 2008 and causes
total asset turnover 7.68 in 2008 with decrement of 0.12.In 2009 the total asset
turnover becomes 8.56 with increment of 0.88 because the total assets in 2009
are Rs.620240530 and the net revenue becomes Rs.53097381.

47
 netsales
Operating asset turn over = averageope ratingasse ts

ROYAL ENTERPRISES
Activity Ratios Analysis
2005 2006 2007 2008 2009
Operating asset
turnover 2.08 2.57 6.30 2.20 2.66
2015886 3299160 4196213 5309738
Net Revenue 9233881 0 3 1 1
1906549 1992691
Operating assets 4439580 7829770 5234463 6 5

ACTIVITY RATIOS

7.00 6.30 Operating asset

6.00 turnover
RATIOS

5.00
4.00
3.00 2.57 2.66
2.08 2.20
2.00
1.00
0.00
2005 2006 2007 2008 2009
YEARS

Operating assets in 2005 are Rs.4439580 and the net revenue in 2005 is
Rs.9233881 due to which the operating asset turnover in 2005 is 2.08.
Operating asset turnover in 2006 is 2.57 with increment of 0.49 when operating
are Rs.7829770 and the net revenue becomes Rs.20158860. In 2007 operating
assets go up to Rs.5234463 and the net revenue becomes Rs.32991603 which

48
resulting the operating asset turnover 6.30 with increment of 3.73. Operating
assets increase to Rs.19065496 and the net revenue becomes Rs.41962131 in
2008 and causes operating asset turnover 2.20 in 2008 with decrement of
4.10.In 2009 the operating asset turnover becomes 2.66 with increment of 0.46
because the operating assets in 2009 are Rs.19926915 and the net revenue
becomes Rs.53097381.

49
D. Profitability Ratios
grossprofi t
Gross profit margin =
netsales

ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Gross profit
margin 81.23% 70.01% 63.24% 59.10% 54.23%
2430319
Gross Profit 1732760 6045948 12126809 17162817 3
2015886 5309738
Net Sales 9233881 0 32991603 41962131 1

PROFITABILITY RATIOS

90.00% 81.23%
80.00% Gross profit margin
70.01%
70.00% 63.24%59.10%
60.00% 54.23%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
2005 2006 2007 2008 2009
YEARS

Gross profit in 2005 is Rs.1732760 and the net revenue in 2005 is Rs.9233881
due to which the gross profit margin in 2005 is 81.23%. Gross profit margin in

50
 2006 is 70.01% with decrement of 11.23% when gross profit is Rs.6045948
and the net revenue becomes Rs.20158860. In 2007 gross profit goes up to

Rs.12126809 and the net revenue becomes Rs.32991603 which resulting the
gross profit margin 63.24% with decrement of 6.77%. Gross profit increase to
Rs.17162817 and the net revenue becomes Rs.41962131 in 2008 and causes
gross profit margin 59.10% in 2008 with decrement of 4.14%.In 2009 the
gross profit margin becomes 54.23% with decrement of 4.87% because the
gross profit in 2009 are Rs.24303193 and the net revenue becomes
Rs.53097381.
operatingi ncome
Operating income margin =
netsales

ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Operating profit margin 52.95% 47.03% 43.32% 32.88% 26.46%
Operating Profit 4889728 9481648 14291756 13796269 14052051
Net Revenue 9233881 20158860 32991603 41962131 53097381

PROFITABILITY RATIOS

60.00% 52.95% Operating income

50.00% 47.03% margin
43.32%
%AGES

40.00% 32.88%
30.00% 26.46%

20.00%
10.00%
0.00%
2005 2006 2007 2008 2009
YEARS

51
Operating profit in 2005 is Rs.4889728 and the net revenue in 2005 is
Rs.9233881 due to which the operating profit margin in 2005 is 52.95%.

Operating profit margin in 2006 is 47.03% with decrement of 5.92% when

operating profit is Rs.9481648 and the net revenue becomes Rs.20158860. In
2007 operating profit goes up to Rs.14291756 and the net revenue becomes
Rs.32991603 which resulting the operating profit margin 43.32% with
decrement of 3.72%. Operating profit decrease to Rs.13796269 and the net
revenue becomes Rs.41962131 in 2008 and causes operating profit margin
32.88% in 2008 with decrement of 10.44%.In 2009 the operating profit
margin becomes 26.46% with decrement of 6.41% because the operating profit
in 2009 are Rs.14052051 and the net revenue becomes Rs.53097381.

52
 netincome
Net profit margin = netsales

ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Net profit
margin 40.09% 29.51% 28.70% 22.01% 15.91%
Profit After
Taxation 3701544 5949032 9468232 9237015 8445251
2015886 3299160 4196213 5309738
Net Sales 9233881 0 3 1 1

PROFITABILITY RATIOS

45.00% 40.09%
40.00% Net profit margin
%AGES

35.00% 29.51%28.70%
30.00%
25.00% 22.01%
20.00% 15.91%
15.00%
10.00%
5.00%
0.00%
2005 2006 2007 2008 2009
YEARS

Net profit in 2005 is Rs.3701544 and the net revenue in 2005 is Rs.9233881
due to which the net profit margin in 2005 is 40.09%. Net profit margin in
2006 is 29.51% with decrement of 10.58% when net profit is Rs.5949032 and
the net revenue becomes Rs.20158860. In 2007 net profit goes up to
Rs.9468232 and the net revenue becomes Rs.32991603 which resulting the net

53
profit margin 28.70% with decrement of 0.81%. Net profit decrease to
Rs.9237015 and the net revenue becomes Rs.41962131 in 2008 and causes net
profit margin 22.01% in 2008 with decrement of 6.69%.In 2009 the net profit
margin becomes 15.91% with decrement of 6.11% because the net profit in
2009 are Rs.8445251 and the net revenue becomes Rs.53097381.
netincome
Return on asset = averagetot alassets

ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Return on
assets 1.36% 1.71% 2.24% 1.69% 1.36%
Profit After
Taxation 3701544 5949032 9468232 9237015 8445251
27261266 34704895 42332020 54663650 62024053
Total Assets 3 1 7 6 0

PROFITABILITY RATIOS

2.50% 2.24%
Return on assets
2.00%
%AGES

1.71% 1.69%
1.50% 1.36% 1.36%

1.00%

0.50%
0.00%
2005 2006 2007 2008 2009
YEARS

Net profit in 2005 is Rs.3701544 and the total assets in 2005 are Rs.272612663
due to which the return on assets in 2005 is 1.36%. Return on assets in 2006 is

54
 1.71% with increment of 0.36% when net profit is Rs.5949032 and the total
assets becomes Rs.347048951. In 2007 net profit goes up to Rs.9468232 and

the total assets become Rs.423320207 which resulting the return on assets
2.24% with increment of 0.52%. Net profit decrease to Rs.9237015 and the
total assets becomes Rs.546636506 in 2008 and causes return on assets 1.69%
in 2008 with decrement of 0.55%.In 2009 the return on assets becomes 1.36%
with decrement of 0.33% because the net profit in 2009 are Rs.8445251 and
the total assets becomes Rs.620240530.
netincome
Return on operating assets = averageope ratingasse ts

ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Return on operating
assets 83.38% 75.98% 180.88% 48.45% 42.38%
Profit After Taxation 3701544 5949032 9468232 9237015 8445251
1992691
Operating assets 4439580 7829770 5234463 19065496 5

55
 PROFITABILITY RATIOS

200.00% 180.88%
Return on operating
assets
%AGES

150.00%

100.00%83.38%75.98%
48.45%42.38%
50.00%

0.00%
2005 2006 2007 2008 2009
YEARS

Net profit in 2005 is Rs.3701544 and the operating assets in 2005 are
Rs.4439580 due to which the return on operating assets in 2005 is 83.38%.
Return on operating assets in 2006 is 75.98% with decrement of 7.40% when
net profit is Rs.5949032 and the operating assets becomes Rs.7829770. In 2007
net profit goes up to Rs.9468232 and the operating assets become Rs.5234463
which resulting the return on operating assets 180.88% with increment of
104.90%. Net profit decrease to Rs.9237015 and the operating assets becomes
Rs.19065496 in 2008 and causes return on operating assets 48.45% in 2008
with decrement of 132.43%.In 2009 the return on operating assets becomes
42.38% with decrement of 6.07% because the net profit in 2009 are
Rs.8445251 and the operating assets becomes Rs.19926915.

netincome − redeemable preferreds tockdivide nd

Return on total equity = averagetot alequity

56
 ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Return on total equity 21.32% 27.46% 31.71% 19.29% 17.10%
Profit After Taxation 3701544 5949032 9468232 9237015 8445251
Share capital and reserves 17364031 21668270 29863387 47890938 49395663

PROFITABILITY RATIOS

35.00% 31.71%
27.46% Return on total equity
30.00%
%AGES

25.00% 21.32%
19.29%
20.00% 17.10%
15.00%
10.00%
5.00%
0.00%
2005 2006 2007 2008 2009
YEARS

Net profit in 2005 is Rs.3701544 and the total equity in 2005 is Rs.17364031
due to which the return on total equity in 2005 is 21.32%. Return total equity
in 2006 is 27.46% with increment of 6.14% when net profit is Rs.5949032 and
the total equity becomes Rs.21668270. In 2007 net profit goes up to
Rs.9468232 and the total equity become Rs.29863387 which resulting the
return on total equity 31.71% with increment of 4.25%. Net profit decrease to
Rs.9237015 and the total equity becomes Rs.47890938 in 2008 and causes
return on total equity 19.29% in 2008 with decrement of 12.42%.In 2009 the
return on total equity becomes 17.10% with decrement of 2.19% because the
net profit in 2009 are Rs.8445251 and the total equity becomes Rs.49395663.

57
 NetIncome − AllDividen d
Percentage of retained earning = NetIncome

ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Percentage of retained
earning 68.51% 80.41% 87.69% 87.38% 86.20%
Profit After Taxation 3701544 5949032 9468232 9237015 8445251
All dividend 1165500 777000 1295000 1942500 2428125

PROFITABILITY RATIOS
%AGES

100.00% 87.69%87.38%86.20% Percentage of retained

80.41%
80.00% 68.51% earning

60.00%

40.00%

20.00%

0.00%
2005 2006 2007 2008 2009
YEARS

Net profit in 2005 is Rs.3701544 and the all dividend in 2005 is Rs.1165500
due to which the percentage of retained earning in 2005 is 68.51%. Percentage
of retained earning in 2006 is 80.41% with increment of 11.90% when net

58
 profit is Rs.5949032 and the all dividend becomes Rs.777000. In 2007 net
profit goes up to Rs.9468232 and the all dividend become Rs.1295000 which
resulting the percentage of retained earning 87.69% with increment of 7.28%.
Net profit decrease to Rs.9237015 and the all dividend becomes Rs.1942500 in
2008 and causes percentage of retained earning 87.38% in 2008 with
decrement of 0.31%.In 2009 the percentage of retained earning becomes
86.20% with decrement of 1.18% because the net profit in 2009 are
Rs.8445251 and the all dividend becomes Rs.2428125.

netincome − preferredd ividend

Earning Per Common Share= weightaver agenoofcom monshareou ts tan ding

ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Earning Per Common
Share 7.15 11.48 14.62 8.87 8.26
Profit After Taxation 3701544 5949032 9468232 9237015 8445251
51769846 51820836 64762188 104137711 102242748
No of common shares 1 2 8 4 2
RUPEES

PROFITABILITY RATIOS

16 14.62
14 Earning per share
11.48
12
10 8.87 8.26
8 7.15
6
4
2
0
2005 2006 2007 2008 2009
YEARS

59
Net profit in 2005 is Rs.3701544 and the no of common shares in 2005 is
517698461 due to which the earning per common share in 2005 is Rs.7.15.
Earning per common share in 2006 is Rs.11.48 with increment of Rs.4.33 when
net profit is Rs.5949032 and the no of common shares becomes 518208362. In
2007 net profit goes up to Rs.9468232 and the no of common shares become
647621888 which resulting the earning per common share Rs.14.62 with
increment of Rs.3.14. Net profit decrease to Rs.9237015 and the no of common
shares becomes 1041377114 in 2008 and causes earning per common share
Rs.8.87 in 2008 with decrement of Rs.5.75.In 2009 the earning per common
share becomes Rs.8.26 with decrement of Rs.0.61 because the net profit in
2009 are Rs.8445251 and the no of common shares becomes 1022427482.

60
 %changeinne tincome
Degree of financial leverage = %chandeinEB IT

ROYAL ENTERPRISES
Profitability Ratios Analysis
2005 2006 2007 2008 2009
Degree of
financial
leverage 31.75 33.61 37.14 33.01 26.42
Profit After
Taxation 3701544 5949032 9468232 9237015 8445251
1429175 1379626 1405205
Operating Profit 4889728 9481648 6 9 1

PROFITABILITY RATIOS

40.00 37.14
35.00 31.75 33.61 33.01 Degree of financial
leverage
RATIOS

30.00 26.42
25.00
20.00
15.00
10.00
5.00
0.00
2005 2006 2007 2008 2009
YEARS

61
Net profit in 2005 is Rs.3701544 and the operating profit in 2005 is
Rs.4889728 due to which the degree of financial leverage in 2005 is 31.75.
Degree of financial leverage in 2006 is 33.61 with increment of 1.87 when net
profit is Rs.5949032 and the operating profit becomes Rs.9481648. In 2007 net
profit goes up to Rs.9468232 and the operating profit become Rs.14291756

Which resulting the degree of financial leverage 37.14 with increment of 3.52.
Net profit decrease to Rs.9237015 and the operating profit becomes
Rs.13796269 in 2008 and causes degree of financial leverage 33.01 in 2008
with decrement of 4.13.In 2009 the degree of financial leverage becomes 26.42
with decrement of 6.58 because the net profit in 2009 are Rs.8445251 and the
operating profit becomes Rs.14052051.

62
FUTURE PROSPECTS OF THE ORGANISATION:
Initially the company earned lot of profit due to its monopoly in the market but
with the passage of time many other companies have opened the same business
so in a competitive market the earning of the profits is becoming relatively
difficult.
Company is also facing the effect of other national and International problems
which are making the bleak future prospects.
Due to devaluation of Paki rupee the cost of import is increased. Transport
expenses like freight of ship is also increasing due to high fuel prices. At
national level problem of load shedding and early closure of markets is
worsening the situation so the future prospect may or may not be good.
All depend upon the country’s economic situation like improvement in
terrorism and load shedding which are major problems affecting the economy.
If it improves then the prospect would be better.

63
 SWOT ANALYSIS

 Strengths
 Weaknesses
 Opportunities
 Threats

WHAT IS A SWOT?

SWOT analysis is a process to identify where we are strong and where we are
vulnerable, where we should defend and where we should attack. It tells us our
strengths, our weaknesses, the opportunities which prevail in the market and
the threats which we may face from our competitors and other from other
potential factors.

This analysis can be performed on a product, on a service, a company or even

on an individual.

64
SWOT ANALYSIS OF TASTY SWEET CORN:

Here we have applied this very useful technique to identify the strengths, weaknesses,
opportunities and threats of TASTY SWEET CORN AND ROYAL ENTERPRISES.

STRENGTHS:

 Broad production range.

 Excellent environmental and working conditions.
 Safety measures of international standard are exercised.
 Significant contribution towards the economic and agricultural
development of the country.
 No deceptive n unethical practices in management.
 It is also member of responsible corporate citizenship.
 ROYAL ENTERPRISES enjoy fair dealing with competitive prices.

WEAKNESSES:

 Less mobilization of resources.

 There is a lack of joint research and development activities.

65
 Lack of long term planning, decisions are made keeping in view the
short term benefits.
 Monetary sensitiveness to foreign exchange exposure.
 Some little exposure of high-tech technology.

OPPORTUNITIES:
 Great opportunities for joint ventures.
 More ease for internationally integration because of the lower tariff
barriers and
 Removal of quantitative trade restrictions.
 Expansion of outlets to meet the demand more efficiently.

THREATS:

 Threat of entry of new competitors in market.

 Low price of market share as compared to competitors’ will effect
investments.
 No strong brand name can decrease company’s sales level.
 Crises of gas and electricity can effect its production.

66
67
CONCLUSION:

From this report I conclude that TASTY SWEET CORN has still its monopoly
in market due to its best quality and its vast range of products that no other
company is providing in Pakistan.
Also company has very broad chances of flourishing but same time threats of
competitors in market. As Pakistan’s situation is not so much good and also its
economics situation is getting worse day by day, so company has to make some
adjustments to remain in business in Pakistan. Company’s future condition
depends on Pakistan’s economic condition.

68
RECOMMENDATIONS:
Followings are the suggestions that I recommend to company:

 The Company should utilize its resources properly.

 The company must consider the long term benefits and should do long
term planning for that.

 The company should involve the low level management in decision

making.

 They should hire highly qualified and well trained people.

 Training opportunity should be provided to the employees.

69
70
 APPENDIX
• Wikipedia (www.wikipedia.com)
• Askari Bank(www.askaribank.com.pk)
• Scribd (www.scribd.com)
• Tasty Sweet Corn(www.tastysweetcorn.org)

71
ANNEXES

72