1

TRAINING PROJECT REPORT

ON
FINANCIAL SYSTEM & FINANCIAL ANALYSIS IN ACC LTD GAGAL CEMENT WORKS
SESSION (2008-2009)
SUBMITTED TO
MR.SANJAY JOHARY (MANAGER FINANCE)
SUBMITTED BY:
KURUKSHETRA UNIVERSITY, KURUKSHETRA
2
INDEX
________________________________________________________________________  ACKNOWL
EDGEMENT  UNDERTAKING  PREFACE  HISTORY OF INDUSTRY  ASSOCIATED CEMENT COMPANY LTD      C
ORPORATE PROFILE OF ACC LTD ENVIRONMENTAL POLICY OF ACC LTD MISSION & VISION OF
ACC LTD ARTICHETS OF ACC LTD ACC MILESTONE
 GAGAL CEMENT WORKS        INTRODUCTION GEOGRAPHICAL DETAIL CONTRIBUTION TO GOVERNMENT Q
UALITY POLICY ENVIRONMENTAL POLICY PRODUCTION SYSTEM IN GAGAL CEMENT WORKS MANUF
ACTURING PROCESS
3
 
POWER CEMENT PLANT
 DEPARTMENTATION  FINANCE DEPARTMENT   ACCOUNTING SECTION COST SECTION
 FINANCIAL CONDITION OF ACC LTD  FINANCIAL HIGHLIGHTS OF THE COMPANY  BALANCE SHEET
OF ACC LTD  PROFIT & LOSS ACCOUNT OF ACC LTD  FINANCIAL POSTION OF ACC LTD   SHORT
TERM LONG TERM
 NEEDS OF STUDY  OBJECTIVES OF STUDY  RESEARCH METHODOLOGY  DESIGN OF STUDY  RATIO AN
ALYSIS(FINDINGS)  LIMITATION OF STUDY  FINDINGS
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 RECOMMODATIONS/SUGGESTIONS  POLICY IMPLICATIONS  BIBLIOGRAPHY ____________________
______________________________________________
5
HISTORY OF CEMENT INDUSTRY
The history of the cement industry is the story of civilization from primitive c
aves of prehistoric times to the skyscrapers of the modern age. It is said that
the use of cement is from period use of fire Egyptians utilize gypsum plaster as
cementing material as early as 3000 BC in building their monuments. Material ce
ment has existed the roman empire Joseph Arpdin invited Portland cement in 1824
after the discovery of hydraulic properties of time, patented his product which
was call Portland cement. Portland stone which is lime stone quarried on Portlan
d bill indorsed, England. Modern cement is outcome of effort of chemist¶s technolo
gist & architects. Cement is binding agent having hydraulic properties, which af
ter hydration gives the setting properties strengthening concrete. Intergrading,
Clinker, Gypsum, & Pozzolanic material in a proper ratio to get Portland Pozzol
ane Cement manufacture cement. Cement essentially made up of material containing
calcium silicon, aluminum and iron. Limestone, marl and chalk are major source
of clay shale, quartzite, bauxite iron ore provide silicon, aluminum & iron comp
onents. CEMENT INDUSTRY OUTLOOK AND OPPORTUNITIES: India is the second largest p
roducer of cement in the world. The cement industry witnessed the significant gr
owth of 7.75 % in the calendar year 2008. During the year, most cement companies
operated at high capacity utilization levels to meet increasing demand. While t
he pricing environment was favourable during the year, there were significant in
creasing cost particularly in energy, transportation and other inputs. The year
was commendable one considering the massive increase in the production of blende
d cement, especially fly ash based. With rapidly growing of housing,
Infrastructure and real estate sectors and the ambitious plan for the developing
Special Economic Zone (SEZ), the cement industry is expected to enjoy double di
git growth. Cement remains the highest taxed among all the essential infrastruct
ure inputs in India. Various govt. taxes and duties put together constitute over
70 % of the extra-factory
6
price. Cement industries are a major contributed to the exchequer with excise du
ty alone working out to be over Rs. 5500 crores annually. Yet it is irony that c
ement is an essential commodity required by all sections of society including co
mmon man. The cement industry receives coal through long term linkages. Ministry
of coal is not sanctioning linkages to new capacity which is adversely affectin
g the cement industry. The situation becomes all difficult, as the ministry of c
oal is supplying 80 % of total requirement of the cement industry through Fuel A
greements (FSAs). While cement plants may have to procure through other channels
. Cements industry is largely dependent on captive power generation as the power
availability situation is grim in the most producing steps, both in term of qua
lity and quantity. Most cement plants have been compelled to make matters worse;
some state governments are also imposing taxes and duties on these captive powe
r plants. Although expectations are the industry will perform well during 2007 w
ith demand likely to grow about 9 to 10 %. The demand supply scenario will be ba
lanced most regions, though some region may experience seasonal tightness. Indus
try should be appreciative of the govt. as a target of 8 to 9% growth has been a
imed for in the XI Plan, and the cement industry is an integral part of the core
sector of industries.
MAJOR COMPANIES IN THE CEMENT INDUSTRY ARE: The Associated Cement Companies Ltd. 
Birla Group.  Larsen & Turbo.  J.K. Group.  India cement.  Guraj Ambuja. CORPORATE P
ROFILE OF ACC LTD. The associated cement companies (ACC) story begins in 1936. W
ar clouds were gathering over Europe; the economy of the western world was deep
in recession; and an Indian industry was reeling under severe difficulties. But
one man undaunted by the times
7
was building a vision for the future. The man was F.E. Dinshaw ±a man of tremendou
s foresight and outstanding initiative. The vision was to build a strong and uni
fied cement industry that not would not only with stand all difficulties but als
o fulfil its responsibilities to the nation. The result was the amalgamation of
ten of the existing cement companies ± belonging to four large industrial houses o
f that time, viz, the house of Tata, Khatau, Dinshaw and kellick Nixon-to form t
he nucleus of what is today known as ACC LTD (formerly the associated cement com
panies) Barely three years was later the fledging company catapulted into the fi
ery cauldron of World War II and resources were geared to meet that onslaught. A
CC was there ±more than that eyewitness to history Over the year ACC realized that
people are as different as they are similar .different needs different dreams.
With its depth of knowledge and width of experience ACC today is period to fulfi
l the hopes and aspirations of the people across the length and breadth of the c
ountry. For more than six decades now. ACC has has been forging a pioneering pat
h making cement. Along the way it sharpened its expertise on the cutting edge of
the latest processes/ technologies; learning /adapting- -no just transplanting ±t
o meet the specifies of local operating parameters in the process- setting stand
ards, innovating, non just meeting needs, but anticipating them. ACC is a very f
ond acronym in India, often assuming synonimity with cement. With a annual cemen
t capacity of over 12 million tones, the company¶s operation are spread throughout
the country with 12 cement plants, 3 refractories, 12 regional marketing office
s, several area offices, and a dedicated band of people from all corners of Indi
a. Thus in industrial backdrop of India ACC stands for multi-product, multi-unit
company. The companies various businesses are supported by a powerful, in-house
research and technology backup facility-the only one of its kind in the Indian
Cement Industry. ACC has also extended its services to overseas, to the Middle E
ast, Africa and South America, where it has provided technical & management cons
ultancy to a variety of consumers, and also helps in the operational maintenance
of cement plants abroad.
8
In addition to its modernization and expansion, ACC has earmarked on an all arou
nd internal improvement program through introduction of various world class benc
hmarking and total productivity maintenance practices. Through an organization w
ide Business Process engineering, it has able to achieve revenue enhancement and
cost savings by optimally aligning business practices with customer needs. It w
ould also result in further simplification of the internal management process an
d delay ring and decentralization for fast decision making purposes. Today, ACC
stands poised to enter the new millennium, ready to seize the opportunities and
face the challenges that lie ahead. With more than six decades of experiences, A
CC has a rare perspective of sound business strategies, with which ACC is poised
to maintain its leadership in Cement Industry.
A GLIMPS ON THE HISTORY ON SUCCESS
THE Associated Cement Companies Limited is a multi business enterprise with oper
ation in cement manufacturing. It is one of leading companies in India, producin
g more than one-fourth of national output. ACC. Ltd as company duly registered u
nder Indian Companies Act 1956, having its registered office at Cement House, 12
1 Maharishi Karv Road, Mumbai-400020.It has 14 cement plants spread all over the
country and has major force of its industry through customer satisfaction & thr
ough continuous innovation in quality of the product. As company ACC Ltd. is com
mitted to make and deliver as cheaply as possible. Initially, when cement was in
troduced in 1914, South India Industry Ltd.started first cements plant near Madr
as. But due to lack of labors and knowledge in manufacturing of cement, this pla
nt after a few months working closed down. After ward in 1912-1919 two more plan
ts wee started in Katni situated in Madhya Pradesh and in,Lakhri in Rajasthan, b
efore 1924 six more plants were started at various other places but they did not
led any good start. In 1936 with the effort of Mr.Dinshaw a group of companies
and formed Associated Companies Ltd. Many men of outstand initiative and foresig
ht contributed towards the development of cement industry in India. About 62 yea
rs ago in 1936 a number of companies belonging to the house of Tata Khatias and
Kellick, Nixon combined to from ³The associated
9
Cement Companies Ltd´.Great industrialist and patriot Mr.F.E.Dinshaw was mainly re
sponsible into a single organization. The objectives of this merger were not to
attain monopolistic position but to make and deliver cement as cheaply as possib
le. Mr Dinshaw added for new factories in ACC group from 1929 to 1936. During Se
cond World War, the cement was deliver as essential commodities under the defenc
es of Indian rule and through under price and distribution control. The cement i
ndustry gets further impetus under the leadership of ACC. CHANGE IN THE NAME OF
THE COMPANY & ACCOUNTING YEAR The company has changed its name to ACC Limited w.
e.f. Sept.01, 2006 pursuant to resolution passed by the shareholders at the 70th
Annual General Meeting of the Company and after obtaining all requisite approva
ls. The accounting year has been changed from April-March to January-December. T
herefore the accounts have been drawn up for nine months, for the period ended D
ecember 31, 2005. SUBSIDIARIES AND ASSOCIATES OF ACC In addition to the main cem
ent business has certain joint ventures, subsidiaries and associations formed th
rough technical collaboration and partnership with globally reputed companies, m
ining and radial tyres. In the year 2000, the management of ACC decided to dives
t those of its non- cement businesses that are unrelated and do not enhance or c
omplement the company's basic strength. Bargarh Cement Limited (BCL) The newest
subsidiary of ACC, was formerly called IDCOL Cement Limited. BCL has a cement pl
ant located at Bargarh near Sambalpur in Western Orissa with a capacity of 0.96
million tonnes per annum. The Bargarh cement plant has a modern dry process kiln
and predominantly manufactures Portland cement, most of which is sold in the st
ate of Orissa. BCL became a subsidiary of ACC in December 2003 when ACC purchase
d from the Industrial Development Corporation of Orissa Limited its entire share
holding in BCL amounting to 86.79% of BCL's equity share capital. In March 2004,
BCL became a 100 % subsidiary of the company after ACC purchased the remaining
13.21 % equity shares in BCL held by the Unit Trust of India.
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Bulk Cement Corporation (India) Limited (BCCI) Situated at Kalamboli, in Navi Mu
mbai (formerly New Bombay), this company caters to bulk cement requirements of t
he city of Mumbai and its environs. It has two cement storage silos with a capac
ity of 5,000 tons each. The plant receives cement in bulk from ACC plants at Wad
i. The plant has its own special purpose railway wagons and rakes and its own ra
ilway siding. The first of its kind in India, BCCI is equipped with all the faci
lities required by increasingly sophisticated construction sites in a bustling m
etropolis, including a laboratory, a fleet of specialized trucks and site silos
for the convenience of customers and is capable of offering loose cement in bulk
-tanker vehicles as well as packed cement in bags of varying sizes from 1 tonne
down to 25 kg bags. BCCI is situated strategically on the outskirts of Mumbai, j
ust off the new Mumbai-Pune Expressway. It is a landmark structure spread over 3
0 acres of land. Damodhar Cement & Slag Limited (DCSL) This subsidiary company h
as a cement-grinding unit located at Madhukunda, in the Purulia district of West
Bengal. With a capacity of 5.25 lakh tonnes per annum, it is a vital source of
cement to the eastern India. DCSL offers ACC Super, a premium brand of blended c
ement. ACC Machinery Company Limited (AMCL) Located in the Butibori Industrial e
state near Nagpur, AMCL manufactures machinery and equipment for use in chemical
s and cement industries such as bulk transports, vertical pre-grinding roller mi
lls and blowers and tyre and rubber manufacturing machinery such as presses, Mix
er and extruders. ACC Nihon Casting Limited This state-of-the-art foundry is als
o based in Butibori, near Nagpur and manufactures alloy steel castings for a ran
ge of processing and mineral industries. It was set up in technical collaboratio
n with Nihon Cement Company (now known as Asanotec Ltd) JOINT VENTURE: Everest I
ndustries Limited (EIL) This subsidiary of ACC is a leading building products co
mpany which manufactures fibre-based cement products, such as sheets for roofing
and interiors as well as Non
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Asbestos Flat Sheets for varied applications including pre-fab housing. Its 'Eve
rest' Brand enjoys huge brand equity. Besides roofing, the Company has introduce
d a range of New Generation Products called E-Board Classic for varied applicati
ons in interiors. EIL has four plants in India, Including a modern R&D facility
near Nashik in Maharashtra. Aloca ACC Industrial Chemical Ltd. (AAICL) This is a
joint venture between ALOCA, Aluminium Company of America (60%) the world¶s large
st aluminium and aluminium chemicals company and ACC (40%). ACCICI commenced ope
rations in Jan. 1944. The plant is on 6.3 acres of land, and processing capacity
is 10,000 metric ton of white tabular alumina in a single shift operation. The
safety environment, health and industrial hygiene standards of Aloca ACC are a p
er/comparable with other ALCOA locations worldwide.
INTERNATIONAL ASSOCIATIONS: With its large pool of skilled scientists, engineers
and technocrats who keep abreast of the latest international trends and develop
ments in cement, ACC has successfully handled a diverse range of assignments in
different parts of the world, mainly in Asia and Africa. Our project engineering
consultancy and project management expertise has been tested against the best i
n the world. Saudi Arabia Yanbu Cement Company (YCC) Since 1979 ACC has been ope
rating and managing a large cement plant owned by Yanbu Cement Company (YCC) and
located near the port city of Yanbu in the Kingdom of Saudi Arabia. The Yanbu p
lant incorporates sophisticated process control systems. YCC Today has a capacit
y of over 3.30 million-ton's per annum. Cement production at this plant has cont
inued to exceed the guaranteed quantum stipulated in the contract year after yea
r. The ACC team of Yanbu has won appreciation for significant achievement make w
ith respect to ISO 9002 certification, launching of ISO 140000 em's certificatio
n activity manufacture of Portland Pozzalana Cement and a substantial increase i
n the quantum of exports. Iran and India Cement Engineering Consultants PJS (IIC
EC) Iran
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Iran and India Cement Engineering Consultants PJS (IICEC) is a joint venture com
pany between ACC and Far Khuzestan Cement Company, Iran's largest cement company
. IICEC provides consultancy services to the Iranian Cement Industry in areas su
ch as process diagnostic studies of existing plants, up gradation and capacity e
nhancement of existing cement plants and training Iranian engineers to upgrade t
heir knowledge and skills. Nigeria - Dangote Industries ACC has been retained by
M/s Dangote Industries, a leading diversified industrial group of Nigeria, to p
rovide comprehensive engineering consultancy for setting up their proposed new g
reen field cement plants of capacity 3 x 7000 TPD (ton's per day) and for optimi
zation and up gradation of their existing plants from 2x2000 TPD to 2x3500 TPD.
ENVIRONMENTAL POLICY OF ACC LTD.
 Ensure continual improvement periodic review of action plan.  Prevent  Comply poll
ution and with all minimize in environmental performance by carrying out emissio
ns. regulatory requirements.
fugitive
applicable legal and
 Create environment awareness among employee and community at large.  Minimize the
waste generation at source reutilize the work if generated.  Conserve energy and
mineral resource.
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 Region
(North)
LAKHERI
GAGAL
TIKARIA
 Region
(East)
DCW SIND RI
KYMORE
CHAIBA SA
BARGARH
CHANDA
JAMU L
WADI
 Region (South
West)
MADUKKARAI
MISSION OF ACC LTD.
LEADERSHIP:- Maintain our leadership of the Indian cement industry through the
country modernization and expansion of our manufacturing facilities and activite
s and through the establishment of a wide and efficient marketing network.
PROFITABILITY:- Achieve a fair and reasonable return on capital by promoting
productivity throughout the company.
GROWTH:- Ensure a steady growth of business by strengthening our postion in the
cement sector.
QUALITY:- Maintain the high quality of our products and services and ensure thei
r
supply at fair prices.
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EQUITY:- Promote and maintain fair industrial relation and environment for the
effective involvement, welfere and development of staff at all levels.
RESPONSIBILITY:- Fulfill our obligation to society, specifically in tha area of
integrated rural development and in safeguarding.
PIONEERING:- Promote research and development effort in the area of product
development and energy and fuel conservation, to innovate and optimize productiv
ity.
VISION OF ACC LTD.
Vision of ACC is to be one of the most respected companies in India; recognized
for challenging convections and delivering on our promises.
ARTICHETS OF SUCCESS.
NAME OF DIRECTOR S.NO 1. MR.N.S.SEKHARIA 2. MR.PAUL HUGENTOBLE (DEPUTY CHAIRMAN)
3. MR.SUMIT BANERJEE 4. MR.A.L.KAPUR (MANAGING DIRECTOR) (CHAIRMAN)
NATIONALITY
INDIAN
SWISS
INDIAN
INDIAN
15
5. MR.S.M.PALIA 6. MR.NARESH CHANDRA 7. MR.MARKUS AKERMAN 8. MR.D.K.MEHTROTRA 9.
MR.R.A.SHAH 10. Dr.NIRMALYA KUMAR 11. MR.SHAILESH HARIBHAKTI 12. MR.ANIL SINGHV
I 13. MR.A.K.JAIN (WHOLETIME DIRECTOR)
INDIAN
INDIAN
SWISS
INDIAN
INDIAN
INDIAN
INDIAN
INDIAN
INDIAN
ACC MILESTONES.
1936
Incorporation of The Associated Cement Companies Limited on Augest 1, 1936.
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1936
First Board meeting of The Associated Cement Companies Limited held at Esplanade
House, Mumbai on November 10, 1936.
1937
With the transfer of the 10th company to ACC, viz., Dewarkhand Cement Company, t
he formation of ACC is complete on October 23, 1937.
1944
ACC`s first community development venture near Bombay.
1947
India`s first entirely indigenous cement plant establish at Chaibasa in Bihar.
1952
Village welfare scheme launched.
1955
Sindri cement works used the waste product calcium carborate sludge from fertili
zer factory at Sindri.
1956
Bulk cement Depot established at Okhla, Delhi.
1957
Technical training institute established at Kymore, Madhya Pradesh
1957
Katni Refractories.
1961
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Blast furnace slag from TISCO used at the Chiabasa Unit to manufacture Portland
Slag Cement for the first time in India.
1961
Oilwell Cement manufacture at ACC Shahabad Cement Works in Karnataka for cementa
tion of oilwells up to a depth of 6000 feet.
1961
Manufacture of Hydrophobic (waterproof) cement at ACC Khalari Cement Works in Bi
har.
1962
Manufacture of Accoproof a waterproofing additive.
1965
ACC`s Central Research station establish at Thane.
1965
Manufacture of Calundum, a High Alumina Binder,firecrete, Low Density Alumina Ca
stables and high Alumina Refractory cement.
1965
Manufacture of Portland Pozzolana Cement.
1968
Advent of computer in ACC for data processing and designing management informati
on and control systems.
1968
ACC supplied and commissioned one-million-tone iron ore palletizing plant ordere
d by TISCO.
1971
Manufacture of Whytheat Castables A, K, C and Cal-Al-75.
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1973
Takeover of the cement marketing company of India (CMI).
1977
ACC received ASSOCHAM first national award from the year 176 instituted for outs
tanding performance in promoting rural and agriculture development activities.
1978
Introduction of the energy efficient precalcinator technology for the first time
in India. Full scale commercial production based on MFC technology at Wadi in 1
979.
1979
ACC wins international contract for operation and management of a new one millio
n tone cement plant at Yanbu-Ras Biridi in Saudi Arabia.
1982
Commissioning of the first MPTA plant in the country at Wadi, Karnatka.
1984
ACC achieves a breakthrough in import substitution by developing and supplying a
special G type of oil well cement to ONGC.
1987
ACC develops a new binder for use at sub-zero temperatures, which is successfull
y used in the Indian expedition to Antarctica.
1992
Incorporated of bulk Cement Corporation of India, a joint venture with the Gover
nment of India.
1993
ACC starts the commercial manufacture of Ready Mixed Concrete at Mumbai.
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1998
Commissionong of the 0.6 MPTA cement grinding unit at Tikaria, Utter Pradesh.
1999
Commissioning of captive power plants at the Jamul and Kymore plants in Madhya P
radesh.
1999
Tata group sells 7.2% of its stake in ACC to Ambuja Cement Holding Ltd., a subsi
diary of Gujarat Ambuja Cement Ltd. (GACL).
2000
Tata group sells their remaining stake in ACC to the GACL group with 14.45% now
emerge as the single largest shareholder of ACC.
2001
Commissioning of the new plant of 2.6 MPTA capacity at Wadi, Karnataka plant, th
e largest in the country and among the largest sized kilns in the world.
2002
ACC wins PHDCCI Good Corporate Citizen Award.
2003
IDCOL Cement Ltd. becomes a subsidiary of ACC.
2004
IDCOL Cement Ltd. is renamed as Bargarh Cement Limited.
2004
ACC raise US $ 100 million abroad through Foreign Currency Convertible Bonds for
US $ 60 million and Global Depository Share for US $ 40 million. Both offering
are listed on the London Stock Exchange.
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2004
ACC named as a Consumer Super brand by the Super Brand Council of India becoming
the only cement company to get this status.
2004
Green Tech Safety Gold and Silver Award awarded to Madukkarai Cement Works and K
atni Refractory Works by Green Tech Foundation for outstanding performance in Sa
fety Management System.
2005
ACC receive the CFBP Jamnalal Bajaj Uchit Vyavahar Puraskar Certificate of Merit
-2004 from Council For Fair Business practice.
2005
Holcim group of Switzerland enters strategic and alliance with Ambuja group by a
cquiring a majority stake in Ambuja Cement India Ltd (ACIL) which at the time he
ld 13.8% of total equity share in ACC. Holicm simultaneously makes an open offer
to ACC shareholder, through Holcim Cement Pvt Ltd and ACIL, to acquire a majori
ty shareholders in ACC. Pursuant to open offer, ACIL`s share holding in ACC incr
eases to 34.69% of the equity share capital of ACC.
2006
ACC receives Good Corporate Citizen Award 2005-06, from Bombay chamber of commer
ce.
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BUSINESS RELATION BETWEEN ACC & HOLCIM
A New Association was forged between ACC and the Holcim Group of Switzerland in
2005. In January 2005, Holcim announced its plans to enter into a long-term stra
tegic alliance with the Ambuja Group by acquiring a majority stake in Ambuja Cem
ents India Ltd. (ACIL), which at the time held 13.8 per cent of the total equity
shares in ACC. Holcim simultaneously announced its bid to make an open offer to
ACC shareholders, through Holcim Cement Pvt Limited and ACIL, to acquire a majo
rity shareholding in ACC. An open offer was made by Holcim Cement Pvt. Limited a
long with Ambuja Cements India Ltd. (ACIL), following which the shareholding of
ACIL increased to 34.69 per cent of the Equity share capital of ACC. Consequentl
y, ACIL has filed declarations indicating their shareholding and declaring itsel
f as a Promoter of ACC. Holcim is the world leader in cement as well as being la
rge suppliers of concrete, aggregates and certain construction-related services.
Holcim is also a respected name in information technology and research and deve
lopment. The group has its headquarters in Switzerland with worldwide operations
spread across more than 70 countries. Considering the formidable global presenc
e of Holcim and its excellent reputation, the Board of ACC has welcomed this new
association. The company implemented an ERP system that has standardized busine
ss process to run SAP software called ³CONNECT INDIA´ system is based on a template
that caters to ready-mix concrete business, cement and AFR process of the compan
y with the assistance of Holcim Group. All operations, locations and transaction
become fully integrated in a manner i.e. on line with updated data and informat
ion. The new system will greatly enhance the company¶s capability to capture and p
rocess a comprehensive range of data to be used for decision making and day to o
peration while automating some processes which were not part of earlier IT syste
m. Project connect India integrates tighter control through well defined authori
zation profiles and rigid system. The new features serves as triggers to usher i
n better work habits and practices.
22
GAGAL CEMENT WORKS
INTRODUCTION:
Gagal Cement Works implemented & obtained ISO14001 Environment System, ISO9001:2
000 Quality Management System & OHSAS18001 Occupational Health and Safety Manage
ment System Certification. The Gagal Cement Works was set up in the year 1984 wi
t the aim to serve the market of Himachal Pradesh, Punjab, Uttaranchal, Utter Pr
adesh and Jammu & Kashmir. ACC was the first to put up large scale industry hous
e in a backward area of Himachal Pradesh. Gagal-1 unit started with an annual ca
pacity of 0.56 Million Tones(with one kiln of 1700 TPD). Gagal-11 unit of 1 Mill
ion Tone capacity (with one kiln of 3300 TPD) was installed in 1994-1995. Today
Gagal Cement Works has risen to produce 3.2 million tones of blended cement and
is like to increase to 4.0 Million Tones in the current financial year 2005 to 2
006.Gagal Cement Works is market leader in northern region and maintains its mar
ket share in all strategic markets.GCW is the largest cement unit in this entire
Zone. Four other major cement manufactures from Himachal Pradesh, Punjab and Ra
jasthan are his competitors. ACC cement has very strong brand image, trusted by
generation for consistent and durable cement quality, fair business and practice
and long association with dealers and customers are the principal factor which
provide us competitive advantages over the other brand. ACC unique R & D support
and business policy, differentiate it from its competitors.
GEOGRAPHICAL DETAILS
Among the largest private sector companies, ACC is the only company to set up a
cement plant in 1982 in backward designated area at Barmana, Distt. Bilaspur (HP
) and started production with effect from 12th March 1984. Barmana is 18 kms nor
th to Bilaspur. The National Highway No.21 connecting Ambala in Haryana and Mana
li in H.P. passes through Gagal Cement Works and its colony. The colony is at la
titude 31.5-degree north and 77degree East Longitude. The total land acquired fo
r the factory, colony and mining area is 2319.10 bighas. Factory
23
covers 365 bighas, the colony covers 345 bighas and the mining area is about1633
bighas. The topography of the area around the worksis mount-ainous. Mean maximu
m temperature of the area goes upto 45 degree Celsius in the month of June and t
he minimum temper- ature upto 3-degree in the month of December. The work has ge
nerated direct and indirect employment to the scale of nearly 12000. Nearby Town
s: Bilaspur, Sunder Nagar, Mandi.
CONTRIBUTION TO GOVERNMENT
Annual contribution to center government by way of taxes, duties is 155 crore ou
t of which for Himachal Government is 100 crore. And along with this it is also
helping Govt. as its social responsibility. The company has constructed a Govt.
degree college; it is spending money on schools, hospital and on other works of
public welfare.
GAGAL CEMENY WORKS-AN TOWARDS EXCELLENCE
UNRELENTLESS
PURSUIT
Gagal Cement Works is committed to deliver quality products to the customers. Ga
gal Cement Works has to its credit many a prestigious certifications like IS/ISO
9002, ISO 14001 for environmental management system and OHSAS 18001 for adoptin
g high class measures in the sphere of Occupational Health and Workers Safety in
the manufacturing of cement.
QUALITY POLICY
Build Quality In Do not Sort Bad Quality Out Quality Improvement is Limitless an
d therefore Continuous Concern for Quality is for Entire Organization and Not Ju
st for Product Satisfy Customer Fully and Continuously
24
GAGAL CEMENT WORKS- A SYSTEMATIC APPROACH FOR CLEANER WORLD
ACC GAGAL Cement Works is the first point in Himachal Pradesh to have EMS certif
icate. The Bureau of Indian standards awarded this certificate to the works in M
arch 1999. The certificate has resulted in batter understanding among all the em
ployees, of overall environmental issues related to the plant. The main feature
of EMS at Gagal is total involvement of employees. EMS is a program of continuou
s environmental improvement following a welldefined sequence of steps drawn from
the established project management practice and routinely applied in business e
nvironment.
ENVIRONMENTAL POLICY
 Prevent pollution and minimize fugitive emissions  Comply with all applicable leg
al and regulatory requirements  Conserve water, energy and natural resources  Mini
mize waste generation and utilize the same  Create environmental awareness and pr
ovide clean and safe environment to employees and community at large
PRODUCTION SYSTEM IN GAGAL UNIT Main Raw Material
 Limestone  Quartzite  Iron Ore  Shale  Gypsum  Fly Ash
EMPLOYEES IN GAGAL CEMENT WORKS:
25
The company is having the strength of manpower approximately nine hundred, out o
f which 90 are from management staff. Company needs low employees because of aut
omation.
CERTIFICATION:
Certification from IS/ISO 9002, ISO 14001 for environmental management system an
d OHSAS 18001 for adopting high class measure in the sphere of occupational heal
th and workers safety in the manufacturing of cement
MANUFACTURING PROCESS
The Gagal Cement Works is based on the most modern process of cement manufacturi
ng namely a dry process suspension preheated kiln with precalcener. The limeston
e is crushed in the crusher. It is than grinding in Raw Mill along with Shale an
d Iron Ore to fine power. The grinding material is blended to a uniform consiste
ncy and fed to the kiln system pulverized Coal in the kiln system to heat the ma
terial to a temperature of 1500 degree Celsius. The material undergoes a series
of chemical reaction to form a Clinker. The clinker is cooled in the Clinker Coo
ler and stored in the Clinker silos. It is extracted from the Silos and integrat
ed along with Gypsum and Pozzolanaic material to form Portland Pozzoiana cement.
The cement is stored in cement silos. It is packed in 50-kg bags by automatic p
acking machine, loaded in trucks by auto loaders and various consumption center
in Himachal Pradesh as well as the neighbouring states of Punjab, Haryana and J&
K.
POWER:
The co. met 54% power requirement through captive generation. Cost of captive po
wer generation was 34% lower as compare to grid power. In keeping with its polic
y of maximizing its captive power capability. It is also the process of increasi
ng its thermal captive power generation capacity by another 45 MW. The company h
as already achieved significant reduction in cost in specific area like fuel, po
wer and manpower. The drives for cost reduction will be further insified all are
a of operations.
MAP KEY
00 ± Limestone quarry and crushing plant. 01 ± Llime Stone Stock Pile. 02 ± Additive H
ooper. 03 ± Additive Storage.
26
04 ± Raw Mill Building. 05 ± Blending & Storage Silo. 06 ± Preheater. 07 ± Gas Condition
ing Tower and ESP. 08 ± Kiln. 09 ± Cooler. 10 ± Deep Bucket Conveyor. 11/12 ± Clinker/Gy
psum Storage. 13 ± Coal Mill Building. 14 ± Coal Mill And Bag Storage. 15 ± Cement Sto
rage Silo. 16 ± Packing & Dispatch. 17 ± Cement Control Room.
DEPARTMENTATION:
QUARRY DEPARTMENT
The Quarry Department is mainly concerned with the maintenance of Mines at ACC B
armana. The sub-departments namely MINE; ELECTRICAL, GARAGE, CRUSHER, STACKER &
RECLAIMER support the Quarry department.
MINES
Gagal lime Stone Mine is captive mine of M/S ACC Ltd., Gagal Cement Works. The m
ining lease covers an area of 265.97 hectares. Presently the mine is one of the
largest mine of northern India and is fully mechanized by Heavy Earth Moving Equ
ipment's.
27
LIME STONE AND COAL HANDLING SECTION LIMESTONE
The crushed limestone is received from Gagal Quarry with the help of a series of
belt conveyer and stacked in stockpile with the help of stackers.
COAL
Coal is used as a fuel for firing in the Kiln. Gagal Cement Works receives coal
from different collieries of CCC, ECL and NEC by rail upto Kiratpur Sahib.
LABORATORY DEPARTMENT
Laboratory department in coordination with other departments carries our regular
quality control functions. Quality and process control measures are exercised a
t each and every stage of process. Inspection and procurement of raw materials,
its testing, quality control of input materials, intermediate products at differ
ent level of process and final product that is cement are done as per procedures
. Inspections and Test Records are maintained in the Laboratory as per the schem
e of testing and inspection. The departmental activities are coordinated by Depu
ty Manager-QPC who reports to Manager- Production. Gagal Works laboratory has th
ree sections: 1. Chemical & Instrumentation laboratory 2. Physical Laboratory 3.
Site Laboratory
PROCESS DEPARTMENT
The Process department guides the operations in maintaining process parameters s
o that production is within the desired range of quality parameters. The process
parameters are arrived at after discussions with the Departmental Heads of vari
ous sections (Raw Mill, Cement Mills & Laboratory) Manager ± Production, coordinat
es the departmental activities.
28
RAW MILL
Activity of Raw Mill starts from feeding Raw Material (limestone, Quartzite and
Iron Ore) to the Mills and ends at filling the Raw Meal to Silos.
RAW MATERIAL FEEDING
Lime stone feeding to Raw Mills/Roller Mills is through the sequence of belt con
veyors to different Hoppers. Feed size of limestone is 90 mm and Mills Scale, Sh
ale feeding is from the Gantry to the respective Hoppers through sequence of bel
t conveyors. Shale feeding is through Reclaimed or Pay Loader.
RAW MILL
Two close circuits two chamber Ball Mills are performing the grinding of limesto
ne and Additive mix. Raw Mill is a tube construction of thick MS plate with stee
l lines and compartments are separated by diaphragm for improving the retention
time and transfer of materials in second for further grinding. Mill is charged w
ith hyper steel balls. Raw material is first fed to Tertiary Crusher (Single Rot
or Reversible Impact Crusher) which reduces the size of Mix. After crushing the
mix the material is fed to Ball Mill where fine grinding takes place. The finer
product is separated by Air Separator and is fed to the blending silos and the c
oarse material is fed back to the Mill Inlet.
VERTICAL ROLLER MILL (VRM)
In VRM Section the material is directly fed into Mill through the feed belt for
grinding. The ground material is stored in continuous flow silos from where it i
s fed to the Kiln. VRM utilizes hot air from the kiln exhaust for drying the Raw
Mix Deputy Manager ± VRM, who reports to Manager (Maintenance) coordinates the de
partmental activities
KILN DEPARTMENT
Kiln Department functions are categorized under two heads, Manager (Maintenance)
is responsible for the maintenance of all equipment and Manager (Production) is
responsible for the Clinker Production and its quality parameters. Gagal Cement
Work has two rotary kilns. Kiln no 1 is having 3 streams coupled with 2 four st
age and 1 five stage preheater with 2 precalciners, DDF and MFC. Kilns No 2 are
having twin stream 5 stage preheater with precalciners. Pulverized coal is used
as a fuel for calcination. The Clinker is discharged to horizontal grate cooler
and is stored either in Silos or in stockpiles.
29
CEMENT MILLS DEPARTMENT
The basic function of the department is to grind the required ratio of clinker a
nd gypsum in the manufacture of OPC and clinker, Gypsum and CCP/fly ash for the
manufacture of PPC with the help of 4 ball Mills for cement grinding.
PRE GRINDING UNIT
Roller Press is the pre-grinding unit for Cement Mills 1 & 2. In Roller Press tw
o rollers are arranged in horizontal fashion. One is fixed and other has a hydra
ulic thrust arrangement for horizontal movement. The clinker is fed vertically d
own ward between the rollers and gets crushed by the hydraulic pressure arrangem
ent The product, which is in flakes, is fed to the Ball Mill with other additive
s for finished grinding.
FINISHED GRINDING
Finished grinding is performed in Ball Mills. Ball Mill is a rotating shell divi
ded into two chambers fitted with shell liners for shell protection and charged
with grinding media to the required volume. The impact and friction between the
grinding media and material perform grinding. Out put from the ball Mills is fed
to the dynamic separator where the coarse and fines of specific sizes are separ
ated. The coarse is again conveyed to the Ball Mill for further grinding. The fi
nes are conveyed to cement silos through a series of elevators and air slides. I
n order to get the desired specific surface for cement the RPM of separator is v
aried accordingly? The departmental activities are coordinated by Dy. Manager-Pl
ant who reports to Manager (Maintenance).
ELCTRICAL AND INSTRUMENTATION (E & I) DEPARTMENT
The primary function of the E & I department is to maintain all E & I equipment
in the plant to provide the necessary service to ensure the smooth operation of
all E 8 & I equipment.
ELECTRICAL
Electrical equipment mainly comprising transformers, HT/LT motors, DC Motors, sw
itch gears, power distributor system and factory and residential colony lighting
Besides the above E & I department is also responsible for the maintenance if t
he electrical installations of the colony. The department CO-ordinates with the
other relevant departments for proper utilization of the Grid & DG power.
30
INSTRUMENTATION
Instrumentation system can be effectively termed as the nervous system of the pl
ant. With the recent advanced in technology instrumentation has become one of th
e most important aspect of cement manufacturing industry. Almost all the monitor
ing and controlling parameters are now available I the Central Control Room (CCR
) for operators to run the plant efficiently. Accuracy and degree of control has
increased manifold due to the latest instrumentation control systems. Dy. Manag
er (Electrical) and Dy. Manager (Instrumentation) report to Manager (E & I) for
electrical and instrumentation activities.
WORK SHOP
Following activities are carried out in the workshop department: 1. Departmental
maintenance Activities 2. Maintenance of Gear Boxes 3. Compressors & PD Blowers
4. Water Pumps 5. Various equipment at Rambagh Pump House, Filter and Sewage Wa
ter Treatment plants. The departmental activities are coordinated by Dy. Manager
(Plant) who reports to Manager (Maintenance).
COMMERCIAL DEPARTMENT Procurement Section: This section looks after that equipme
nt, tools and other
requisite items are made available to different departments in time. Deputy Mana
gerPurchase who reports to Sr. Manager-Commercial coordinates the departmental a
ctivities. Packing House Department: Packing plant is the place where cement is
packed & dispatched to various locations. Gagal Cement Works packing department
has six silos with total storage capacity of 35200 tonnes. There are three Rotar
y Packer in Gagal I packing plant with a capacity of 100m TPH each and two elect
ronic rotary packers in Gagal II packing pant with a capacity of 180 TPM each. A
ll the packers have truckloading facility because the cement form Gagal works to
different locations by road.
31
The various varieties of cement handled are: 33 Grade Ordinary Portland Cement (
OPC) 43 Grade Ordinary Portland Cement (OPC) PPC (Portland Pozzolona Cement) Ass
istant Manager-Plant reports to Manager Commercial for Packing Plant Activities.
Cement Dispatch Section: Cement dispatch section receives dispatch instruction f
or Regional Marketing Office, Chandigarh and also from Shimla. The trucks regist
ered with authorized transporters enter the factory gate with Loading Advice cum
gate Pass. The Truck¶s Gross weight is taken at the Exit Gate by electronic weigh
bridge and finally an Excise Invoice is issued to the truck driver.
The departmental head reports to Manager Commercial.
THE CIVIL DEPARTMENT
In cement industry the maintenance and applications of Refractories in kiln and
its auxiliary units are one of the most important job. It is the refractory, whi
ch is subject to all sort of, processes and operational conditions like high tem
perature, abrasion, alkalis, chemicals, thermal shocks, mechanical shocks etc. A
nd protects the metallic body of the units. Due to this fact a strict adherence
with the quality of the refractory at every step from receipt to its application
is of paramount importance. In the organization the civil department does the c
omplete dealing with the refractory and is also responsible for all civil relate
d jobs in the factory and colony. Deputy Manager-Civil who reports to Manager-Ma
intenance coordinates the departmental activities. MAINTENANCE INSPECTION PLANNI
NG & SYSTEMS (MIPS) As the name suggests the main function of the department is
preparing and planning for carrying out various inspection, maintenance job and
top record and update the inspection results. Inspection/Maintenance planning is
based upon the diagnosis of change in behavior pattern of sound, temperature, h
eat, vibration, viscosity etc.
32
MIPS department also coordinates in planning the maintenance activities of vario
us departments so as to get optimum utilization of stoppage duration. MIPS also
carries out the down tile analysis of main equipment.
GENERAL STORES
The general stores is the department which is involved in making the balanced an
d timely flow of materials, spares, tools and equipment. General Stores also arr
anges for the disposal of the scrap and unwanted materials. Deputy Manager who r
eports to Works Manager coordinates the activities of the department.
INFORMATION SYSTEM DEPARTMENT
The functions of Information System Department is to: 1.Transformation of EDP to
Decision Support System 2. Optimize End User Computing to increase the Individu
al Productivity 3. Capture Processing and Sharing of Information from the Net 4.
In House Development & Deployment of Application Packages 5. Database Maintenan
ce & Administration Hardware Setup y UNIX based RISC Server. y Win-NT based Inte
l Servers y Microsoft Exchange Server P I, P II, P III & P IV PCs : 135
Software Setup Operating System: UNIX SVR 4, Win - NT 4.0, Win ± 95 & Win - 98 Ora
cle 8 I, Developer 2000, Microsoft Exchange 5.5. MS-OFFICE ± 97 Office XP
33
Intra-plant Connectivity All plants, RMOs, Head Office is connected through INSA
T- 3B services provided by TataNet. Connectivity to the external World is throug
h IIS, Head Office.
34
MARKETING
ACC Range of cement and blended cements are marketed through a network of 12 reg
ional marketing offices, several area offices and warehouses. A countrywide netw
ork of about 11,000 stock lists who, in turn, are assisted by the sub- dealer's
back this. Such an all-pervasive marketing network has an enabled ACC to consoli
date itself with a national presence. And the customer is assured of being able
to get quality ACC products when and where he wants them. Complementing this is
a unique customer services cell comprising qualified civil engineers, which assi
st and advice customers with prior and post sales services. This service begins
with selection of type and grade of cement (where applicable) to trouble shootin
g and on site assistance. Keeping pace with changing times, and an ever- growing
need for specialized services, ACC has been offering its marketing expertise an
d distribution facilities to other producers in cement and related areas. Howeve
r, a precondition of all such agreement is quality control supervision to be car
ried out by an ACC expert located at the franchisee's plant. Currently, ACC has
franchising agreements for cement marketing with Alcon Cement Company, Goa and C
ochin cement Ltd., Cochin. ACC also exports cement to SAARC Nations, especially
Nepal and Bangladesh on a regular basis. Besides ordinary Portland cements, thes
e exports include custom- tailored cements.
HUMAN RESOURCES DEPARTMENT
The basic object of setting up Human Resource Department is to provide inputs to
the employees for his optimum level of efficiency. It includes looking after va
rious HR related functions such as training & development, performance and poten
tial appraisal, planning and allocation of manpower, industrial relations includ
ing negotiations and dealing with staff functions such as transfer, promotion, d
isciplinary action, grievance handling etc. Department is also responsible for p
roviding welfare amenities/facilities to employees, dealing with land matters, c
ommunity development, colony administration etc. Various details of personnel po
licies are readily available with HR department. Manager-HR & Admn. Coordinates
the activities of the department. Manager-HR & Admn. Coordinates the activities
of the department.
35
Manpower Arrangement:
` The total manpower employed at ACC, Gagal Cement works are divided into 2 cate
gories. Management Staff is governed by Conduct Rules framed by the company wher
eas Non-Management Staff is governed by Standing Orders certified under the Indu
strial Employment (Standing Orders) Act, 1946
MANPOWER
Mgmt. Staff
Non-Mgmt Staff
TM - Top Management WM -Works Manager E4 - Sr. Manager E3 - Manager E2 Deputy Ma
nager E1 Assistant Manager
MONTHLY PAID
DAILY PAID
Grades
A B C D
Grades
TC I II III IV V
Senior Officer/Engg.
36
TOTAL PRODUCTIVE MAINTENANCE
ACC Gagal Cement Works has continuously tried to improve upon its operational pr
oductivity through world class plant management practices known as Total Product
ive Maintenance (TPM). TPM is the integration of the basic functions of Producti
on and Maintenance allowing the employees to jointly take the responsibility for
, and ownership of their work processes and equipment. It aims to maximize Overa
ll Equipment Effectiveness (OEE). It establishes and promotes a systematic appro
ach to achieve operational excellence through autonomous working. TPM involves a
ll employees at all levels in every function of its implementation. The most imp
ortant point about TPM is that it continuously encourages all the employees to u
ndertake continuous improvement of all work-related processes and systems by ado
pting a proactive problem solving approach. 15th of every month is the day for T
PM gate Meeting. We are striving towards following goals using TPM: y Zero Break
down y Zero Accident
y Zero Defect y Zero Waste y Zero Inventory
SAFETY
Gagal Cement Work constantly keeps a vigil on the safe practices of doing work a
nd in this regard expects the same from all its employees. The following table p
resents the expectations from both the participants in this regard. Deputy Manag
er-Safety coordinates all activities related to safety at works. Besides day to
day safety functioning, safety committee meets once in every month. The committe
e consists of equal number of representatives form management and wage board emp
loyees.
37
All employees working inside the factory are required to wear helmets, safety sh
oes and other safety gadgets. Other regular safety activities include monthly Ga
te Meeting, on first of every month, Nukkad Drama, Quiz & Slogan Competition cel
ebration of National Safety Day etc.
OUR SAFETY COMMITMENT
MANAGEMENT EMPLOYEES
1. Provide Safe working Condition
The care of oneself and colleague
2.Provide system for the safe control of work
Immediately report any unsafe condition/hazard
3. Supply information on work hazard
Look out for hazards and potential dangers to self and others
4. Arrange adequate training and instrucyion in safe working practices
Do not take any short ± cuts
5.Make appropriate protective clothing and equipment available
Know the safety guidelines and follow working instructions
6. Punish people violating instructions on safety and health
Always use safety equipment indicated and provided
38
FINANCE DEPARTMENT
Introduction:
Finance department plays a major role in the working of any organization as for
allpurpose, money is required, which is arranged, procured and disbursed as the
finance department. They only make budget go for cost control and maintain to op
timum balance of cash for smooth operations. As such the finance department in G
agal cement works is looking after only some of the aspects like payment for raw
material purchased, cost control and insurance aspects of the unit. All receipts
for cement sold is received by Regional office at Chandigarh and fund financed
by unit for different payment from its R.O.
Hierarchy of the finance department: It is a line organization having a full-fle
dged department to manage the finance budget, costing and other matter of this d
epartment. The ACC Gagal cement works president has to manage two departments ma
inly i.e. works and finance.
39
President
General Manager
Assistant Manager
Senior Officer (Cash)
Senior Officer
Senior Officer (Costs)
Clerks Fixed Asset Cost Employee Salary Transportation Cash
40
FINANCE DEPARTMENT
Account Section: The accounts section deals all the general accounting, employee
payroll, billing and matter related to taxation etc. The department activities
are coordinate by Assistant Manager-Accounts that report to Manager-Finance. Cos
t Section The Cost Section does Accounting relating to preparation of Monthly Co
st Data and Bill Provisioning.Assistant Manager-Cost coordinates the departmenta
l activities and reports to Manager-Finance. 1. GEERAL OR ACCOUNTS SECTION
Accounting Procedure:
The accounting procedure of ACC Gagal cement works is not a new complicated one.
They follow a standardized rule of making entries in there books of accounts or
posting or making their trial balance, Gagal cement works unit make its Trial B
alance in the monthly basis transaction and rent it to the Head Office. Head Off
ice prepares final accounts for all units not individual unit. Gagal cement work
s follows the following procedure: Step1: The quotations are called for acquirin
g or procuring the particular assets, raw material fuel etc. Step2: After then e
stimate decide/fixed through CESS. (CAPITAL EXPENDITURE SECTION SCHEME) Step3: A
fter then allocation of budget for different requirements. Step4: Then order re
place, R.M/Assets be procured, inspected (G.R.No) by the concerned department. S
tep5: Then GR No. After quality check etc. is sent to finance department where t
he cashier makes the payment. Step6: The ledger department debits this in the bo
oks.
41
Step7: Finally at the wish of finance department assets is charged and declared
free.
FINANCE MANAGER
Finance Manager is totally responsible for all activities to payment/receipts of
cash and fund Management of the unit. His decision on payment will be final as
personal manual, account manual directives laid by the organization. Under Finan
ce Manager the financial activities is disciplined in the manner as per smooth f
unctionary of all activities of payment such as salary and wages, payment to sun
dry creditors which include all pretty payments to local contractors, repuration
s, workers and officers of all grade in working unit. In detail it can be said t
hat under finance manager their will be payment of salary and wages, allocation
of various financial activities such as disbursement of cash by cashier, the pay
ment like contractors bill, local bill, raw material bill, stores and spares pay
ment of raw material and packing material, traveling bills, outstation allowance
s. All the various mislenious payments sanctioned are being made. The financial
activities are on summation of inputs information system department (I.S.D.) pro
vides various financial, cosying outputs available on daily report, weakly repor
t and monthly reports. It also provides information like cash payment, voucher,
cash receipt voucher, and various types of bills also. Various type inventory ou
tput summary of transaction bills of output (local, contractor,raw material etc.
) various type of finance ledgers of the month and monthly trial balance. Accoun
t staff to routs all payment in account department:1. To verify the correction o
f payment 2. To sanction the payment to:a) Staff b) Officer c) Management
FINANCIAL MANAGEMENT PREPAPER
 Payroll of employee.
42
 Accounting of sales.  Financial accounts.  Supply bills.  Material Accounting.
COST SECTION:
The Cost Section is a branch of accounting and has been developed due to limitat
ions of financial accounting. Financial accounting is primarily concerned with r
ecord keeping directed towards the preparation of profit and loss account and ba
lance sheet. It provides information regarding the profit and loss that the busi
ness enterprise is making and also its financial position on a particular date.
The information concerning the business enterprise is helpful to the management
to control in a general way the major function of business viz., finance, admini
stration, production and distribution but details regarding operating efficiency
of these divisions are lacking. Infect, the development in the field of cost ac
counting is so quick and fields covered by it are expanding so much in magnitude
that it becomes difficult for the management to lay down management policies, t
o guide the management decisions or evaluate operating management performance wi
th the information provided by financial accounting.
OBJECTIVES OF COST ACCOUNTING.
The objective of cost accounting are ascertainment of cost, fixation of selling
price, proper recording and representation of cost, data to the management for m
easuring efficiency and for cost control. The aim is to know the methods by whic
h expenditure on materials, wages and overhead is recorded, classified and alloc
ated so that the cost of products and services may be accurately ascertained, th
ese cost may be related to sales and profitability may be determined. Yet with t
he development of business and industry. Its objectives are changing day by day.
The following are the main objectives of cost accounting. a) To ascertain the c
ost per unit of the different products manufactured by a Business concern.
43
b) To provides a correct analysis of cost both by processors or operations and t
he different elements of cost. C) To provides requisite data and serve as a guid
e to price fixing of products manufactured or served rendered. d) To ascertain t
he profitability of each of the products and advise the management as to how the
se profits can be maximizes. e) To reveal sources of economy by installing and i
mplementing a system of cost control for materials, labor and overheads. f) To a
dvise management on future expansion policies and proposed capital projects. g)
To help in the preparation of budgets and implementation of budgetary control. h
) To guide management in the formulation and implementation of incentive bonus p
lans based on productivity and cost savings. i) To supply useful data to the man
agement to take various financial decisions such as introduction of new products
replacement of labor by machine etc. j) To help in supervising the working of p
unched card accounting or data processing through computers. k) To organize the
internal audit systems to ensure effective working of different department. l) T
o organize cost reduction program with the help of different department Managers
.
COST SHEET OR STATEMENT OF COST
Cost sheet is a statement designed to show output of a particular accounting per
iod along with break- up of costs. The data incorporated in cost sheet are colle
cted from various statement of accounts which have been written in cost accounts
, either day ± by ±day or regular records. There is no fixed form for preparation of
cost sheet but in order to make the cost sheet useful it is generally presented
in columnar form. The columns are for the total cost of current period, per uni
t for the current period, total cost and per unit cost for a period and so on. C
ost sheet is a memorandum statement. Therefore, it does not from part of double
entry cost accounting records. Inspite of this, the relationship between cost sh
eet and financial accounts, which are maintained on double entry system, is very
important as cost sheet derives its data from financial accounting.
44
SPECIMEN OF STATEMENTS OF COST UNITS:TOTAL COST PARTICULR DIRECT MATERIAL DIRECT
LABOUR DIRECT EXPENSES PRIME COST ADD: WORKS OVERHEAD WORKS COST ADD: ADMINISTR
ATION OVERHEAD COST OF PRODUCTION ADD: SELLING AND DISTRIBUTION OVERHEAD TOTAL C
OST OR COST OF SALES (RS.) XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX COST PER UNIT
(RS.) XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX
TREATEMENT OF STOCK: Stock requires special treatment while preparing a cost she
et. Stock may be of raw materials, work-in-progress and finished goods.
STOCK OF RAW MATERIALS: If opening stock of raw materials, purchased of raw mate
rials and closing stock of raw materials are given, then with the help of the fo
llowing raw materials consumed can be calculated as: RS. Opening stock of raw ma
terials Add: Purchase of raw Materials x x x x x x
____________
45
x Less: Closing stock of Raw Materials x
x x
x x
____________ Cost of Raw Materials consumed x x x
_____________
STOCK OF WORK ±IN-PROGRESS:
Work ±in-progress means units on which some work has been done but which are not y
et complete. Work-in-progress is valued at prime costs or work cost basis, but t
he latter is preferred. If it is valued at works or factory cost then opening an
d closing cost may will be adjusted as follows: Prime cost Add: Factory overhead
incurred Add: work-in-progress (beginning) x x Less: work-in-progress (closing)
Factory or works cost x x x x x x x x x x x x x x x x
Stock of Finished Goods: If opening and closing stock of finished stocks are als
o given, and then these must be adjusted before calculating cost of goods sold a
s under: Cost of Production Add: Opening stock of finished goods x Less: closing
stock of finished goods Cost of goods sold x x
46
x
x x x x x
x x x x x x
STATEMENT SHOWING COST OF CLINKER MANUFACTURE PARTICULARS RAW MATERIAL: Lime sto
ne PURCHASED IRON ORE Purchased Quartzite (corrective materials) OWN QUARTZITE O
ther Raw Materials (shale) FUEL : COAL Coke POWER : PURCHASED OWN GENERATION DIE
SEL COST OF CLINKER AMOUNT (RS.)
47
STATEMENT SHOWING COST OF CEMENT GROUNDS PARTICULARS COST DATA Materials consume
d : CLINKER PURCHASED GYPSUM FLY ASH Cost Of Cement Ground AMOUNT (RS.)
STATEMENT SHOWING COST OF CEMENT PACKEDAND LOADED
PARTICULARS COST DATA PACKAGING AND LOADING COST EXCLUDING PACKAGING MATERIALS P
acking material cost : HDPE Bags (High Density Polythene) COST OF PRODUCTION
AMOUNT(RS.)
TOOLS AND TECHNIQUES OF COST CONTRL  Budgetary control  Standard costing
48
 Standardization of product and tools and equipment¶s  Improvement in design  Materia
l control  Labor control  Overhead control  Production planning and control  Automat
ion  Operation research  Market research  Planning in control of finance WAYS OF AC
KIEVING COST REDUCTION (In Gagal Cement Works (ACCLtd.) Barmana, Bilaspur)  Reduc
ing set- up- time.  Eliminating material handling activities.  Choosing an inserti
on process.  Using common components.  Choosing best quality of raw material at re
asonable price.  Reducing idle time.
FINANCIAL CONDITION OF ACC
SHARE CAPITAL
Issued capital and subscribed capital as a December 31st,2008 increased to Rs.18
7.88 crore as against Rs. 187.83 crore as at the end of previous year primarily
on account of exercise of conversion option by the FCC Bond Holder.
RESERVE AND SURPLUS
49
Reserve and surplus as at December 31st 2008 stood at Rs.4739.85 crore as compar
ed to Rs.3964.78 crore as at the end of previous year. The increase is mainly on
the account of retained profits.
LOAN FUND
There has been a increase in loan fund to Rs.482.03 crore as at December 31st 20
08 as compare to Rs.314.70 crore as at the end of previous year.
FIXED ASSETS
Net fixed assets including capital work in progress as at December 31st 2008 was
Rs.3469.70 crore as compared to Rs.3314.72 crore as at the end of previous year
.
INVESTMENT
Total amount of investment as at December 31st 2008 was Rs. 679.08 crore as comp
ared to Rs.844.98 crore as at December 31st 2007.
DEFFERED TAX LIABILITIES
Deffered tax liabilities provision outstanding as at December 31st 2008 was Rs.1
777.36 crore as compare to Rs.1554.92 crore as at the end of previous year.
NET CURRENT ASSETS
Net current assets decreased to Rs.138.99 crore as at December 31st 2008 from Rs
.7.26 crore as at December 31st 2007.
50
FINANCIAL HIGHLIGHTS 2008 ± 2009 (ACC).
2008
PARTICULAR Gross Revenue Profit/(Loss) before tax and exceptional items Exceptio
nal Items Profit/(Loss) after tax and exceptional items Dividends Capital Employ
ed Net Worth Borrowings Debt: Equity Ratio
2007 (in crore) 8025.81 1717.18 213.11 1438.59 438.92 4790.57 4152.71 306.41 0.0
7
(in crore) 8548.48 1687.74 48.86 1212.79 439.14 5745.55 4927.73 482.03 0.10
Book Value Per Share at Period End Basic Earning per Share Dividend Per Share Em
ployee(Number) Shareholder(Number)
262.56 64.63 20.00 9557 1,55,813
221.33 76.75 20.00 10,032 1,27,476
51
Profit and Loss Account of the year 2008-07
S.No. Particulars 2008 (in Crore) 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. Rat
ed Capacity Production Gross revenue(including Excise Duty) Employees Cost Mfg.
and other Expences Depreciation Interest Expences Provision for tax Income(4-5 t
o 9) Percentage of Gross Revenue Par Share Dividend Retained Profit (10-13) 226
208 8548 413 6114 294 40 524 1163 13.62 62.02 439 724 2007 ( in crore) 224 199 8
026 353 5576 305 74 492 1226 15.27 65.32 439 787
52
BALANCE SHEET AS AT DECEMBER 31, 2006
S.no
PARTICULAR
2008 (in crore)
2007 (in crore)
743 1460 2221 (18) 3964 845 -4769 332 306 3965 188
1. 2. 3. 4. 4. 5. 6. 7. 8. 9. 10. 11.
Cash and securties Receivebles and Inventories Less: Current Libalities Total(1+
2+3) Net Block Investments Other Non Current Assets Tola Assets less Current Lib
alities Deferred Tax Libalities Borrowings Reserves and Surplus Share Capital
984 1751 2741 (6) 5073 679 --. 5746 336 482 4740 188
NEEDS OF STUDY
The study in itself a problem of how best to manage capital of a company i.e. AC
C Ltd. Therefore, needs for conducting the study are as follows:1. Due to time b
etween production and sales, every company has to maintain a substantial portion
of working capital to run its operation smoothly. 2. In case of manufacturing c
ompanies it is required to maintain about 40% - 50% of their capital as current
and remaining in the form of fixed assets for the large scale production of prod
uct. So, every manufacturing company needs to arrange required working capital.
53
3. Investment in current assets and the level of current liabilities have to gea
red quickly to change in sales. To be sure, fixed assets investment and long ter
m financial position are also responsive to variation in sales.
OBJECTIVE OF THE STUDY
The objectives aim to highlight the reasons how important is the financial syste
m and financial statement for an organization or company. There are various obje
ctives of the study are as follows: 1. To study liquidity of the firm 2. To stud
y long term financial position 3. T study the short term financial position 4. E
arning per share
RESEARCH METHODOLOGY
Our Research project has a specified framework for collecting the data in an eff
ect manner. Such framework is called ³Research Design´. The research process which w
as followed by our consisted of following steps:
Defining the problem & Research objectives:The dfinition of problem includes the
study of financial system in ACC Ltd GAGAL CEMENT WORKS.
Developing The Research Plan:
It is very important to researching anything we must know about the it`s main so
urces where we get the main information regarding the research plan. The develop
ment of research plan has following steps:
54
Data Sources:
There are two types of data were taken into consideration i.e. Secondary data an
d primary data. The secondary data has been used to make the analysis because we
have no much sufficient time and resources to collect the primary data.
Secondary Data:
Secondary data is that data which is collected for other purpose. This is indire
ct collection of data from sources containing past or recent past information li
ke annual reports, balance sheet, books, newspapers and magazines etc.
Collecting The Information:
For this tesearch methodology, we were collecting information with the help of a
nnual reports, balance sheets and other companies publications.
Analyse The Information:
In this research methodology the next step is to extract the pertinent finding f
rom the collected data. We tabulated this collected data and develop the means o
f analyzing the data. There are so many tools for financial analysis but we main
ly concentrate on the RATIO Analysis and supportive information taken from the o
ther means i.e. comparative financial statements with its major components viz.
common size statement, comparative financial statement.
DESIGN OF STUDY
The finance has an important impact on the working of an industry or organizatio
n. So it becomes significant to note that the money makes the money. Money plays
an important role to run the business smoothly. So it needs a sound planning of
finance arrangement and preparation of financial statement. The design of study
is therefore significant to know the financial arrangement and working of capit
al in the production organization or company like ACC Gagal Cement Works (Barman
a). It is therefore with this point of view the present study has been undertake
n as present training report.
55
RATIO ANALYSIS
MEANING OF RATIO:Ratio Analysis is one of the most powerful tool of financial an
alysis. It is the process of establishing and interpreting various ratios. It th
e help of ratios that the financial statements can be analysed more clearly and
decisions made from such analysis.
USE OF RATIOS:The use of ratio analysis is not confined to financial manager onl
y. There are different parties interested in ratio analysis for knowing the fina
ncial position of firm for different purposes. In view of various users of ratio
s, there are many type of ratios which can be calculated from the information gi
ven in the financial statements. The particular purposes of user determines the
particular ratios that might be used for financial analysis.
RATIO ANALYSIS OF ACC GAGAL CEMENT WORKS LTD:ANALYSIS OF SHORT TERM FINANCIAL PO
SITION OR TEST OF LIQUIDITY:
The short term creditors of the company like suppliers of goods of credit and co
mmercial banks providing short term loans are primarily interested to knowing th
e company`s ability to meets its current or short term obligations as and when t
hose become due. The short term obligation of a firm can be met only when there
are sufficient liquid assets. Therefore a firm must ensure that it does not suff
er from lack of liquidity or there capacity to pay its current obligations. If a
firm fails to meet such current obligations due to lack of good liquidity posit
ion, its goodwill in the market is likely to be affected beyond repair. It will
result in a loss of creditor`s confidence in a firm may causes even closure of t
he firm. Even a very high degree of liquidity is not is not good for a firm beca
use such a situation represents unnecessarily excessive funds of the firm being
tiedup in current assets. Therefore, it is a very important to proper balance in
regards to the liquidity of the firm.
56
COMMENTS ON FINANCIAL POSITION OF THE ACC WITH THE HELP OF RATIOS:
SHORT TERM FINANCIAL POSITION:y LIQUIDITY RATIOS:
 CURRENT RATIO:CURRENT RATIO=CURRENT ASSETS/CURRENT LIABILITIES
CURRENT ASSETS
=2735.20Cr.
CURRENT LIABILITIES = 2741.29Cr. CURRENT RATIO = 1:1( approx)
INTERPRETATION OF CURRENT RATIO:
Current Ratio is an indicator of the firm¶s liquidity and its ability to pay its c
urrent obligations in time when they become due. As a convention the minimum of µt
wo to one ratio¶ is referred to as a banker¶s rule of thumb. Current Ratio of ACC Lt
d. is 1:1. it is matter of concern. As a manufacturing concern there is more inv
estment in the capital goods but current assets also to be increased accordingly
to improve the current ratio. A business with heavy investment in fixed assets
may be successful even the ratio is low.
 QUICK RATIO:QUICK RATIO=QUICK ASSETS/CURRENT LIABILITIES
QUICK ASSETS=Cash in Hand and in bank+ B/R + Sundry Debtors + Marketable Securit
ies+ temporary Invesments
QUICK ASSETS CURRENT LIABILITIES QUICK RATIO
= 1349.33Cr. = 2741.29Cr. = 0.50:1
57
INTERPRETATION OF QUICK RATIO:
Usually, a high acid test ratio is an introduction that the firm is liquid and h
as the ability to meet its current or liquid liabilities in time and on the othe
r hand a low quick ratio represents that the firm¶s liquidity position is not good
. As a rule of thumb quick ratio of 1:1 is considered satisfactory. But quick ra
tio of ACC Ltd. is 0.50:1 it is low, company should take necessary steps to impr
ove this.
 ABSOLUTE LIQUID RATIO:
ABSOLUTE QUICK RATIO = ABSOLUTE LIQUID ASSETS/ /CURRENT ASSETS OR = CASH & BANK
+ SHORT TERM SEC./CURRENT ASSETS LIQUID ASSETS CURRENT ASSETS = 991.48Cr = 2741.
29Cr.
ABSOLUTE LIQUID RATIO = 0.361:1
INTERPRETATION OF ABSOLUTE QUICK RATIO:
Absolute quick ratio is also important tool. It shows the relation of absolute l
iquid assets with current liabilities. Rule of thumb for this ratio is 1:2. In r
egards of ACC Ltd this ratio is quite low high. Management should gave attention
in this context.
y CURRENT ASSETS MOVEMENT OR EFFICIENCY/ACTIVITY RATIO:  INVENTORY TURNOVER RATIO
:
INVENTORY TURNOVER RATIO = NET SALES / AVG. STOCK AT COST
58
NET SALES AVG. STOCK
= 7,308.62Cr. = 762.06
INVENTORY TURNOVER RATIO = 9.6times INTERPRETATION OF INVENTORY TURNOVER RATIO:
Inventory turnover ratio is concerned with the maintenance of level of inventory
of finished goods so as to be able to meet the requirements of the business. Le
vel of inventory should neither be too high nor too low. Inventory turnover rati
o indicates the number of time the stock has been turned over during the period.
In the context of ACC Ltd. is manufacturing company the inventory turnover rati
o is good and shows their good efficiency to manage their inventory. Inventory C
onversion Period=Days in year/Inventory Turnover Ratio = 365/9.6 = 38.02 days OR
38 days
INTERPRETATION OF INVENTORY CONVERSION PERIOD:
This shows the time taken to clear the stocks. Stock of the company cleared more
than five times in the year. It shows their good management of the stores. This
is good as a manufacturing concern.
 DEBTORS TURNOVER RATIO:
DEBTORS TURNOVER RATIO= NET CREDIT ANNUAL SALES OR ANNUAL TOTAL SALES/ AVERAGE T
RADE DEBTORS
59
TOTAL SALES
= 7308.62Cr.
AVG. DEBTORS = 299.73Cr. DEBTORS TURNOVER RATIO = 24.38times.
INTERPRETATION OF DEBTOR TURNOVER RATIO:
Debtor Turnover Ratio indicates the number of times the debtors are turned over
during a year. Debtors turnover ratio of ACC Ltd. is higher it shows more effici
ent management of debtors.
AVERAGE COLLECTION PERIOD = NO.OF WORKING DAYS/ DEBTORS TURNOVE RRATIO = 365/24.
98 = 14.9 Days or 15 days
INTERPRETATION OF AVERAGE COLLECTION PERIOD RATIO:
The average collection period ratio represents the average number of days for wh
ich a firm has to wait before its receivables are converted into cash. Average c
ollection period of the ACC Ltd. shows their efficiency for debt collection and
shows their credit terms & policy towards debtors.
 WORKING CAPITAL TURNOVER RATIO:
WORKING CAPITAL TURNOVER RATIO= SALES/ NET WORKING CAPITAL SALES = Rs. 7308.62Cr
.
NET WORKING CAPITAL = Rs. 2747Cr. WORKING CAPITAL TURNOVER RATIO = 2.66 times
60
INTERPRETATION OF WORKING CAPITAL TURNOVER RATIO:
Working capital Turnover Ratio indicates the number of times the working capital
is turned over during a year. Working capital turnover ratio of ACC Ltd. is hig
her it shows more efficient management of Working capital.
ANALYSIS OF LONG TERM FINANCIAL POSITION OR SOLVENCY:
The term solvency refers to the ability of a concern to meet its long term oblig
ation. The long term indebtedness of a firm include debentures holders, financia
l institution providing medium and long term loans and other creditors selling g
oods on installment basis. Long term solvency ratios indicate a firm ability to
meet the fixed the interest and costs and repayments schedule associated with it
s long term borrowings.
(1). DEBT EQUITY RATIO:
Debt Equity Ratio = Outside Funds/Shareholders Fund Outsiders Funds = 482.03Cr.
Shareholders Funds = 4927.73 Cr.. Therefore Debt Equity RATIO = 0.10:1
INTERPRETATION OF DEBT EQUITY RATIO:
This ratio calculated to measure the extend to which debt financial has been use
d in business. Being a manufacturing concern there is more investment in the cap
ital goods. Lower of ratio gives the higher margin of safety. There is no standa
rd norm or rule of thumb regarding the ratio. It depends upon the policy of the
company. There no much more risk in the companies operation. Therefore they rely
on the shareholders funds.
61
(2). TOTAL DEBT TO CAPITAL EMPLOYED RATIO:
TOTAL DEBT TO CAPITAL EMPLOYED RATIO= TOTAL DEBT / TOTAL CAPITALISATION X 100 =
817.82/4927.73 X 100 = 16.5%
INTERPRETATION OF CAPITALISATION RATIO:
FUNDED
DEBT
TO
TOTAL
Though there is no rule of thumb but still lesser the reliance on outsiders the
better it will be ACC Ltd. can raise funds from the outside sources as there is
enough scope.
(3).PROPREITORY OR EQUITY RATIO:
PROPREITORY OR EQUITY RATIO=SHAREHOLDERS FUNDS/ TOTAL ASSETS X 100 SHAREHOLDER F
UNDS = 4927.73 Cr.. TOTAL ASSETS = 5,745.55 Cr. PROPREITORY OR EQUITY RATIO=85.7
%
INTERPRETATION OF PROPREITORY OR EQUITY RATIO:
As equity ratio represents the relationship of owners fund to total assets. In A
CC Ltd. there is high ratio it indicates better is long term solvency of the com
pany.
62
EARNING PER SHARE:
Earnings per Share - [EPS] 2008 (I) Net Profit as per Profit and Loss Account ..
......................Rs.1,212.79 Cr. Adjustment for the purpose of Diluted EPS«««««««« Int
on Foreign Currency Convertible Bonds «««««.. Less: Tax on above ««««««««««««««««. Profit
.....................................Rs. 1,212.79Cr. (II) Weighted average numbe
r of equity shares for Earnings per Share computation Shares for Basic Earnings
per Share .............................Rs.18,76,45,744Cr. Add: Potential equity
shares on exercise of option of ESOS«. Rs.2,83,742Cr. Number of Shares for Diluted
Earnings per Share .......... Rs.18,79,29,486Cr. (III) Earnings per Share (Weig
hted Average) Basic ............................................................
........ Rs.64.63 Diluted ......................................................
............Rs.64.53
INTERPRETATION OF EARNING PER SHARE:
One of the main party interested in the ratio analysis is the shareholders are t
he real owners of the company. Earning per share is more important for sharehold
ers because they were the risk taker. In the ACC Ltd. face value of share is Rs.
10 and earning per share is Rs.64.63 this shows their good and sound financial p
osition.
63
FINANCIAL POSITION OF THE COMPANY:
SHORT TERM FINANCIAL POSITION:
The short term financial position of the company is good enough. Current Assets
of the company in the year 2008 is Rs.2735.20Cr.where as the Current Liabilities
is Rs.2741.29Cr. Current Ratio is 1:1. Company needs bit improvement in it so t
hat to make it 2:1. Short term liquidity position is also good as the acid test
ratio is 0.50:1. Company needs bit improvement to make it 1:1. Turnover Ratio of
the company reflects their good and sound position. Stock turnover over ratio i
s 9.6 times. It is good that they clear their stock more than 5 times in the yea
r. Debtors and creditors turnover ratio also show positive results in their effi
ciency.
LONG TERM FINANCIAL POSTION:
Long term financial policy is not as better as it should be. No doubt company ad
opted very nice policy of financing fixed assets from the long term fixed assets
and the long term liabilities. Rest payment is made in cash, thereby leading to
reduction of the amount of cash. Debt ± equity ratio also gives the same picture.
It should be near to one as possible. But it is not than one in every year. Not
only but also showing the increasing trends. This is not a good sign. Proprieta
ry ratio is 85.7%, it is good, and it is 50% or more than it. Earning per share
is the one of most important factor. Shareholders are the main stakeholders of t
he company they judge the companies performance on the basis of earning per shar
e & dividend declared by the company. In the accounting year 2007 companies earn
ing per share is Rs.76.75. Dividend paid for the current year is Rs.20 per share
.
64
LIMITATIONS OF THE STUDY
Except the supreme power, the Almighty, no one is impeccable and prowess enough
to accomplish anything without any faults and limitations. A research is no exce
ption. No study is devoid of certain shortcomings. Some problems encountered in
this study are under mentioned: y Some officers were too busy to give a sincere
response to investigators & hence their response may not relate to real picture.
y Manager some time denied disclosing some important financial matters, which c
an be helpful in this study. y The time period given to me for the completion of
the project was short in such a short span of time it is difficult to complete
any project in detail. y Some information related to the study, which had been c
ollected from the company was rounded off because of some influence.
65
FINDINGS
SHORT TERM FINANCIAL POSITION: The short term financial position of the company
is not good enough. Current Assets of the company in the year 2008 is Rs.2735.20
Cr where as the Current Liabilities is Rs.2741.29Cr. Current Ratio is 1:1. Comp
any needs bit improvement in it so that to make it 2:1. Short term liquidity po
sition is also good as the acid test ratio is 0.50:1. Company needs bit improvem
ent to make it 1:1. Turnover Ratio of the company reflects their good and sound
position. Stock turnover over ratio is 9.6 times. It is good that they clear th
eir stock more than 5 times in the year. Debtors and creditors turnover ratio al
so show positive results in their efficiency. LONG TERM FINANCIAL POSTION Long
term financial policy is not as good as it should be. No doubt company adopted v
ery nice policy of financing fixed assets from the long term fixed assets and th
e long term liabilities. Rest payment is made in cash, thereby leading to reduct
ion of the amount of cash. Debt ± equity ratio also gives the same picture. It sh
ould be near to one as possible. But it is not than one in every year. Not only
but also showing the increasing trends. This is not a good sign. Proprietary ra
tio is 85.7%, it is good, and it is 50% or more than it. Earning per share is t
he one of most important factor. Shareholders are the main stakeholders of the
company they judge the companies performance on the basis of earning per share &
dividend declared. In the accounting year 2007 companies earning per share is
Rs.76.75. Dividend paid for the current year is Rs.20 per share.
66
RECOMMENDATIONS\SUGGESTIONS
Company is not utilizing its resources up to the maximum Customer base remains
the same SAP is not implemented properly as the employees are not trained to u
se the same Company is not looking for increase in the plant capacity. Impleme
ntation of new policies by Holcim is disturbing the workforce in adapting to the
new work-culture. The company is more dependent on outsider¶s fund. Current Rat
io is 1:1. Company needs bit improvement in it so that to make it 2:1. Long ter
m financial policy is not as good as it should be. No doubt company adopted very
nice policy of financing fixed assets from the long term fixed assets and the l
ong term liabilities. Rest payment is made in cash, thereby leading to reduction
of the amount of cash. The short term financial position of the company is not
good enough. Current Assets of the company in the year 2008 is Rs.2735.20Cr whe
re as the Current Liabilities is Rs.2741.29Cr. High employee turnover rate. The
other cement industries are paying good salaries to employees as compare to ACC
LIMITED that is why employees are leaving the company.
67
POLICY IMPLICATIONS
Some suggestions that I have given to the company and following are the result o
f those suggestions are as follows; y I suggest them to increase the promotion o
f Health and Safety at Work, including the prevention of occupational risks and
it is in the process. y I suggest them to increase the capacity of plant as it a
long term process so company officials said they put that point in the annual b
oard meeting so it is in the process. y Current Ratio of the company is 1:1.so I
suggest them to increase that to 2:1 and they are working upon it. y Company is
not spending so much on the R& D so I suggest them to increase the same and the
company said that they will think to allocate more finance in the budget of the
company.
68
BIBLIOGRAPHY
1. Pandey, I.M. ³Financial Management´, 3rd edition, New Delhi, Vikas Publication Ho
use Pvt. Ltd. P-143to145(Approaches of working capital) 2. Maheshwari, ³S.N, Advan
ced Accounting´, 4th edition Sultan Chand & Sons Publication, New Delhi, 2004, P.N
o. (b40-b48)(tools of financial analysis) 3. Gupta Shashi.k,,´Managemenet Accounti
ng´,5th edition,Kalyani Publishers,New Delhi, P.No 23.1-23.9(working capital manag
ement and finance) 4. Goel D.K, ³Analysis of financial statement´, 10th edition,Avic
hal Publishing Company P.No 2.1-2.38(ratio analysis) 5. Kothari C.R., ³Research Me
thodology Methods and Techniques´ (Second Edition) New Age International Publisher
s, Ansari Road, Daryaganj, New Delhi-110002. Chapter 4, Page 55-58. Chapter 6, P
age 95,100,111. (Methods of data collection, collection of data, and collection
of secondary data´ are referred before the data collection´.) 6. Jain, ,T.R., and Ag
garwal, Dr. S.C., ³Statistics For M.B.A´,VK publication, PP13 Part b, , 2nd Edition
,PP 131-134 Part (³Correlation´ is studied to use these test in study.) 7. Gupta S.P
. and Gupta M.P., ³Business Statistics´, Twelfth Edition, Sultan Chand and Sons Publ
ications. PP 237-241,628-629 (test hypotheses testing) 8. Annual Report of ACC L
td. 2008-07 9. http://www.acclimited.com/financialreports 10. http://www.acclimi
ted.com/profile. 11. http://www.acclimited.com/management. 12. http://www.acclim
ited.com/achivements. 13. http://www.acclimited.com/productionunits. 14. http://
www.acclimited.com/holcim. 15. http://www.acclimited.com/comparison. 16. http://
www.acclimited.com/investments.
69