A FINANCIAL REPORT ON

NAME STD DIVISION ROLL NO.

: KEVAL AMRELIYA : S.Y.B.B.A :A : 05

SUBMITTED TO : L.J.I.B.A PROJECT GUIDE : PROF. KOMAL SHAH

2011-2012

PREFACE
Finance is very important aspect in any business financial management is considered. Mainly with such matters as how a business corporation raises its finance and how it make use of it. In today s era only theoretical knowledge isn t sufficient to survive in the competition. Practical knowledge is also required so as a part of S.Y.B.B.A programmed we use supposed to prepare a financial report. The objective for this preparation isn t only to know about financial function and related financial matters but also to know about financial performance of the company in different years. I have prepared this financial project report on the basis of annual report of TTIC Health Care LTD for the consecutive year 2009, 2010 and 2011. The financial analysis is done on the basic on directors and auditor s report, ratio and cash flow.

ACKNOWLEDGMENT
For preparation of this repot I got the help from the professors, seniors friends and collage. I would like to thanks them all. I am very much thanks full to our collage L.J INSTITUTE OF BUSINESS ADMINISTRATION for introduction preparation of financial report as a necessary aspect of our BBA pregame. I am very much thankful to prof. KOMAL SHAH who have given guidance for preparing this report and helped us to solve the doubts. I also thank other accountancy faculties who helped us a lot.

INDEX SR NO.
1

PARTICULARS
INTRODUCTION TO FINANCE & FINANCIAL MANAGEMENT y Introduction to finance y Introduction to financial management y Definition to financial management y Objectives of financial management y Importance of the financial management INTRODUCTION TO THE COMPANY y Introduction to the sector y History to the sector y Board of directors y TTK Health Care ltd y Growth of the industry RATIO ANALYSIS y Introduction to ratio analysis y Advantage of ratio analysis y Disadvantage of ratio analysis y Calculation of ratio analysis COMMON SIZE BALANCE SHEET OF TTK HEALTH CARE LTD y Interpretation

PAGE NO. 03 04 05 06 07 08 10 11 12 13 14 15 16 17 18 20 22 62 63

COMMON SIZE PROFIT & LOSS A/C OF TTK HEALTH CARE LTD y Interpretation COMPARATIVE STATEMENT OF TTK HEALT CARE LTD COMPARATIVE PROFIT & LOSS A/C OF TTK HEALT CARE LTD INTRODUCTION TO CASH FLOW y Benefit of cash flow statement CASH FLOW OF TTK HEALTH CARE LTD y Interpretation RATIO OF TTK HEALTH CARE LTD CONCLUSION BIBLOGRAPHY XEROX

67 68 70

72

73 75 77 79 80 82 83 84

10 11 12 13

INTRODUCTION TO FINANCE & FINANCIAL MANAGEMENT

INTRODUCTION TO FINANCE
Finance is the study of funds & management. Its general areas are business finance personnel finance & public finance. It s also deals with the concept of times, money, risk & budgeted. It s one of the most important aspects in handling business. Today finance is known as the life blood in the business. In today s life finance is very important one can t do anything without finance. If he/she as knowledge, willynance but no finance he can t setup his business.

INTRODUCTION TO FINANCIAL MANAGENT

Finance holds the key to all human activity. It would be worthwhile to recall what Henry ford once remarked money is an arm to leg you ether use it or lose it. This statement of the Henry ford is apparently simple but is quite meaningful. A business concern may need a small finance. Fianc guide and regulate investment decisions and expenditure to get the best out of the availed funds is the major task of finance we know what is management with the development of management concept; various disciplines of management have been development. A) Financial management B) Production management C) Marketing management Financial management provides the best guide for the future allocated of resources.

DEFINATION OF FINANCIAL MANAGEMENT

Financial management is not the separate one form over all management. In other words, financial management is an integral part of overall management. Financial management is an excellent tool by mean of which resources can be allocated to various project depending upon their importance and payoff capacities. Financial management may be considered to be the management of financial function because financial management is called upon to take three major decisions 1) INVESTMENT DECISION 2) FINANCIAL DECISSION

OBJECTIVE OF FINANCIAL MANAGEMENT

The following are the objectives of financial management. 1) Profit maximization 2) Wealth maximization y Maximization of profit means maximization the rupee income of firm. y Profit maximization is yard stick by which economic performance of the firm can be judge. y Profit is owners reward profitability. y Profitability is a situation where output is more than input. y Profitability is an indicator of economic efficiency. y The concept of wealth maximization has been educated as appropriate and operationally feasible criterion to chose among the alternative availed for the financial action y Wealth maximization means maximizing the net present value of course of action. y The wealth of share holder is reflected in the market value of shares.

IMPOTANCE OF THE FINANCIAL MANAGEMENT

Needless to say that without adequate finance no business can succeed. It is not possible to avail of the opportunities if adequate fianc is not availed. The importance of adequate finance is as follow:1) Success of promotion 2) Smooth running of the enterprise 3) Finance for expansion 4) Cash planning

1) Success of promotion:The success or otherwise of a company can be guessed on the basic of its financial plan. If the plan is defective it will fail to provide sufficient funds to meet the requirement of both fixed and working capital. 2) Smooth running of the enterprise:Finance is required at each storage working capital required for meeting day to day exp. If the enterprise has sufficient working capital than he can run his business very smoothly. 3) Finance for expansion:Finance is required for schemes of modernization expansion and development of the existing enterprise for main thing needed is finance because without it we can t setup the business how we can expand it.

4) Cash planning:An optimist business organizer indulging in rosy dreams of success of his business will lead his business to failure, if he ignores the importance of liquidity.

INTRODUCTION TO THE COMPANY

10

INTRODUCTION TO THE SECTOR

TTK Pharmaceutical was established by TT Krishnamuchusi in 1928, the group started out as an indenting house & became a distributor of several popular consumer product with world renowned brand name like wood words, cadurys, lever, oval tine, ponds, sunlight s & many more. The TTK group evolved from a trading concern to a manufacturing outfit in the under the guidance of it former chairmen TT Krishna machusi ever the visionary the manufacturing of pressure & condoms in the country. The TTK group is a multi product, multi unit with a turnover in excess of Rs 5000 million it has a work force of nearly 6000 in its manufacturing units & branches. TT jagannatham is chairman & managing directors is now the head of the group. The group as it stands today is a 9th strong international company. The group export goods to over 40 countries. The group comprises the following companies.

y y y y y

TTK Prestige limited TTK Textile limited Sara lee TTK limited TTK planet NRI services TTK health care limited
11

y TTK LIG limited y TTK markers medical limited

12

HISTORY OF THE COMPANY

The company was incorporated on 21st may 1958. In 1962 manufacture of ethical product commenced based on foreign knows. How the company started with the manufacture of wood wards water in 1959. In 1974 a basic chemicals division was started with the objective of synthesizing pharmaceutical inter meiotic & chemicals. In 1982 an animal welfare division was setup for the formation of the veterinary use. In 1985 company diversified into the manufacture of ready to use cereal snack food it is equipped to manufacture 10000 metric tons per annum of serial foods. The mergers of FTK chemicals sanctioned by high court of mundra & Andhra Pradesh on 1st June 1988.

13

BOARD OF DIRECTORS
y y y y y y y y y y Mr. T T Jagannatham Mr. T T Raghunatham Mr. R K Tulshan Mr. K R Shrimusthy Mr. B N Bhagwat Mr. J Shrinivashan Mr. R Shrinivashan Mr. K Vaidyanathan Mr. K Shemkuran Mr. I Ravindran Chairman Ex. Vice Chairman Director Director Director Director Director Director Director Whole Time Director

14

TTK HEALTHCARE LIMITED

The health care industry is considered an industry or profession which included or profession which included peoples of skills or judgment or the providing of services and medicines. Health care industry plays an important part in the economy of the country. The health care industry determinate the GDP of the any company it also determinate expert status, employment capital investment, etc. health care segment provides employment opening to many individuals directly associated with the health care sector or other associated sector. A business dealing health care adds the already existing economics by buying utility programs by paying taxes for property. The health care industry consists of the following:y y y y y Dentist & Doctor Protective care & Nursing Pharmacies Allied medical health care Hospitals

15

GROWTH OF HEALTH CARE INDUSTRY

A latest study by global management consultant MC Kinsey predicts that India s health care industry will reach a staggering USD 190 billion mark in less than 2 decades. The study reveals that health care consumption in India will grow at 10.58% annually to reach 190$ billion. The MC Kinsley report says that rural health care is also set to show strong growth & will account for almost half of the total consumption on health care in the country. Industry experts says that could be the reason for companies like wok burst, Apollo & even reliance industry to make their curly moves in the rural health care sector.

16

RATIO ANALYSIS

17

INTRODUCTION OF RATIO ANALYSIS

An investor is interested in information regarding the exact financial position of the business, its earning capacity, the present position with regards to possibility. The publish accounts contains the p&l A/c, balance sheet, directors report, auditor s report and chairman speech. The ratio is one number expressed in term of another. Ratio is customarily expressed in three different ways simple figure, percentage, proportion of number.

18

ADVANTAGE OF RATIO ANALYSIS

The use of ratio was started by bank for ascertain the liquidity and profitability of companies business for purpose of advancing loan. The ratio analysis provides useful data to the management. The advantages of ratio analysis are as follow:y y y y y y Profitability Liquidity Efficiency Inter firm comparison Useful for budgetary control Useful for decision making

1) PROFITABILITY:The gross profit ratio, net profit ratio and ratio of net return on investment gives a good idea of the profitability of business on the basic of these ratio investor get an idea about overall efficiency of business.

2) LIQUIDITY:The current ratio liquid ratio and acid test ratio will tell whether the business will be able to meet its current liabilities as and when they mature.
19

3) EFFICIENCY:The turnover ratio is the excellent guides to measure the efficiency of manager all such ratio present a good picture of the sales or otherwise of the business.

4) INTER FIRM COMPARISON:The inter firm comparison which shows the strength and weakness of the firm as compared to other firm and will indicate corrective measure.

5) USEFUL FOR BUDGETARY CONTROL:Regular budgetary report is prepared in a business where the system of budgetary control is in use.

20

DISADVANTAGE OF RATIO ANALYSIS

As there are many advantage of ratio analysis there are also many disadvantage of ratio analysis which are as follow:-

1) Single year ratio have limited utility 2) Other factor must be considered 3) Limited utility of historical ratio 4) Lack of standard ratio 5) Inaccurate base

1) Single year ratio have limited utility:The utility of ratios computed from the financial statement of one year is obviously limited.

2) Other factor must be considered:While comparing ratio of different firm, it must be remembered that different firm follow different plans and policies.

21

3) Limited utility of historical ratio:While comparing the ratio in past several years it should be remembered that changes in price level may render such comparison useless.

4) Use of one ratio misleading:One ratio used without reference to other ratio may be misleading

5) Lack of standard ratio:There is practically no standard ratio against which the actual performance can be compared. The satisfactory level of ratio of one industry differs to another.

22

CALCULATION OF RATIO ANALYSIS

TYPES OF RATIO
There are 4 main type of ratio which is as follow:

y y y y

Liquid ratio Profitability ratio Solvency ratio Activity ratio

1) Liquid ratio
y Current ratio y Liquid ratio y Quick ratio

23

y CURRENT RATIO :Meaning:This most widely used ratio shows the proportion of current assets to current liability. It is also known as working capital ratio. Objective:The objective of computing this ratio is to measure the ability of the firm to meet its short term financial stringent of a firm. Formula:Current ratio =
 

YEAR Current asset Current liability Ratio Interpretation

2011 1201197345 751626152 1.60%

2010 946591859 537389832 1.76%

2009 919671456 4589108780 2%

The above ratio tells us that there were increases in the year 2009 in comparison to 2010/2011 the ratio of 2009 was 2% and the ratio of 2010 & 2011 was 1.76% and 1.60% resp.

24

2.5

1.5

0.5

0 2009 2010 2011

25

y LIQUID RATIO:MEANING:To remove the defect of current ratio liquid ratio is used. It is a variant of current which is designed to show the amount and fund available to meet immediate payment. This ratio is obtained by dividing the liquid asset by liquid liability. OBJECTIVES:The objective of competing the ratio is to measure the ability if the firm, to meet its short term obligations as when due without relating upon the stock. FORMULA:Liquid ratio = Where as, Liquid asset = current asset stock- preliminary expenses Liquid liability = current liability BOD cash credit YEAR Liquid asset Stock Liquid liability Ratio 2011 1201197345 (268290375) 932906970 (751626152) 1.24% 2010 946591859 (228258544) 718333315 (531389832) 1.34% 2009 919671456 (198890316) 2078440 (458910780) 1.57%
  

26

INTERPRETATION
According to above table year 2009 has high liquid ratio it was 1.57% and in the year 2010 & 2011 it was 1.34 & 1.24% resp.
1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2009 2010 2011

27

y QUICK LIABILITY:MEANING:Quick ratio is finding by dividing quick asset by liquid liability it is known as acid test. OBJECTIVES:Current ratio less stock & debtors. This ratio suggests whether available cash and cash equivalent are sufficient to meet the short term liability. FORMULA:Quick ratio = Where as, Quick asset = cash+ bank balance Year 2011 Cash & bank bal. 608075608 Liquid liability 751626152 Ratio 0.81% 2010 493381832 537389832 0.92% 2009 502946648 458910780 1.09%
 

INTERPRETATION:According to the above table quick ratio of the year 2009, 2010 & 2011 was 1.09, 0.92 & 0.81% resp.

28

1.2

0.8

0.6

0.4

0.2

0 2009 2010 2011 Category 4

29

PROFITABILITY RATIO
(Related to sales) y Gross profit ratio y Net profit ratio y Operating ratio

30

y GROSS PROFIT :MEANING:It is the basic measure of profitability of business. It express relationship between gross profits earn to net sale. OBJECTIVES:The main objective of computing this ratio is to determine the efficiency with production and purchase operation FORMULA:Gross profit ratio =
 

Where as, Gross profit = sales- COGS Cogs= operating STOCK+NET PURCHASE+PURCHASE EXPENCES+WAGES-CLOSING STOCK

31

y NET PROFIT RATIO

MEANING:The ratio measures relationship between net profit and sales of the firm the net profit is obtained after charging operating expenses, interest, depreciation & taxes. To the gross profit OBJECTIVES:The main objective of computing this ratio is to determine the overall profitability due to various factors such as operational efficiency. FORMULA:Net profit ratio = Year NPAT Net sales Ratio 2011 147214557 3102769778 4.74%
   

2010 91274234 2521112410 3.62%

2009 78747424 2196465374 3.59%

INTERPRETAION:According to above table the net profit ratio of the year 2011, 2010 & 2009 is 4.74, 3.62 & 3.59% resp.

32

5 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 2009 2010 2011

y OPERATING RATIO
MEANING:This ratio shows relationship between COGS + operating expenses to sales, admin selling & distribution exp. OBJECTIVE:The main objective of computing this ratio is to determine the operational efficiency with which production of purchase and selling exp. are related. FORMULA:Operating ratio =
 

Where as, COGS = operating stock + purchase closing stock.

33

Year 2011 COGS 1625676493 Operating exp. 1286495875 Net sales 2931884901 3102769778 94.49%

2010 1343805788 1042674071 2404660175 2521992910 95.36%

2009 1192657932 902664991 2112795632 2146465374 96.19%

Ratio

INTERPRETATION:According to the above table the operating ratio of the year 2011, 2010 & 2009 is 94.49, 95.36 & 96.19 resp.

96.5

96

95.5

95

94.5

94

93.5 2009 2010 2011

34

RELATED TO INVESTMENT
1) Return to capital 2) Return to share holder equity 3) Return to equity share capital 4) Return on total asset 5) Earnings per share ratio 6) Dividend per share ratio 7) Dividend payout ratio 8) Price earnings ratio

35

1. RETURN TO CAPITAL RATIO MEANING:It is the only measure which can be said to show satisfactorily the benefits being obtained for the effective involved i.e. for capital invested. OBJECTIVES:The objective of computing this ratio is to find out how efficiently the long term funds supplied by the debenture holder & share holder have been used. FORMULA:Return to capital ratio =
   

Year NPBI & TAX Interest

2011 22144457 17222335 238666892 Share capital 77659830 R&S 679688079 Long term loan 124083176 Capital 881431085 Ratio 27.08%

2010 155022956 17440156 172463112 77659830 569074005 62780244 709514079 24.31%

2009 133745424 18642894 152388318 80874970 540087757 15105449 771978176 19.44%

INTERPRETATION:According to the above table the return to capital ratio of the year 2011, 2010 & 2009 is 27.08, 24.31 & 19.44% resp.
36

30

25

20

15

10

0 2009 2010 Category 3

2. IN RETURN ON SHAREHOLDER EQUITY

MEANING:This is measured by return on share holder equity here share holder equity is the total funds belonging to share holder. It includes paid up equity share capital, preference share capital, R&S. FORMULA:Return on share holder equity =

37

Year NPAT Share capital R&S Share holder fund Ratio

2011 147219557 77659830 679688079 757347909 19.44%

2010 91274234 77659830 569074005 646733835 14.11%

2009 78747424 80874970 540087757 620962727 12.68%

INTERPRETATION:According to the above table the return on share holder equity of the year 2011, 2010 & 2009 is 19.44, 14.11 & 12.68% resp.

25

20

15

10

0 2009 2010 2011

38

3. RETURN ON EQUITY SHARE CAPITAL

MEANING:This ratio is very important as it indicates profitability of a firm from the view point of real owner who are ordinary share holder who bear all the risk of business. It signifies the success with which the management has been able to earn enough return on fund supplied by the proprietors. OBJECTIVES:The objectives of computing this ratio is to find out new efficiency the fund supplied by the equity share holder have been used. FORMULA:Return on equity share capital =
  

Year NPAT Share capital Ratio

2011 147219557 77659830 189.57%

2010 91274234 77659830 117.63%

2009 78747424 80874970 97.37%

INTERPRETATION:According to the above table the return on equity share capital of the year 2011, 2010 & 2009 is 189.57, 117.63 & 97.37% resp.

39

200 180 160 140 120 100 80 60 40 20 0 2009 2010 2011

4. RETURN ON TOTAL ASSET

MEANING:The return on total asset implies how the fund supplied by 60th owner & creditors are utilized in business. FORMULA:Return on total asset =  Year NPAT Interest Total asset Ratio 2011 147219557 17222335 164441892 881431085 18.66%


2010 91274234 17440156 108714390 789529074 13.77%

2009 78747424 18242894 97390318 77254317 12.61%

40

INTERPRETAION:According to the above table the return on total asset of the year 2011, 2010 & 2009 is 18.66, 13.77 & 12.61% resp.
20 18 16 14 12 10 8 6 4 2 0 2009 2010 2011

5. EARNING PER SHARE RATIO MEANING:This ratio measures the profit arability to equity share holder on per share bases. It is the net actual amount paid to share holder as dividend (maximum paid to them). OBJECTIVES:The objectives of computing this ratio is to measure the profitability of the firm on per equity share holder.
41

FORMULA:Earnings per share =

    

Year NPAT Prof dividend No of equity share Ratio

2011 147219537 (-) 7465983 18.96%

2010 91274234 (-) 8087497 11.29%

2009 78747424 (-) 8087497 9.74%

INTERPRETATION:According to the equity share per ratio the ratio of the year 2011, 2010 & 2009 are 18.96, 11.29 & 9.74% resp.

20 18 16 14 12 10 8 6 4 2 0 2009 2010 2011

42

6. DIVIDEND PER SHARE MEANING:The earning per share shows only theoretically what of share holder can get per share out of profit but it is not actual amount that they receive. FORMULA:Dividend per share =
        

Year Dividend paid to eq. share No. of equity share Ratio

2011 31695000 7765983 4.08%

2010 27420000 8087497 3.39%

2009 28466000 8087497 5.52%

INTERPRETATION:According to the above table the dividend per share ratio of the year 2011, 2010 & 2009 is 4.08, 3.39 & 5.52% resp.

43

0 2009 2010 2011

7. DIVIDEND PAYOUT RATIO MEANING:It is the proportion of actual dividend received to the earning per share or the amount which belong to the equity share holders it is obtained by dividing the actual dividend per share by earning per share. FORMULA:Dividend payout ratio =  Year DPS EPS Ratio 2011 4.08 18.96 0.22% 2010 3.39 11.68 0.29%
   

2009 3.52 9.71 0.36%

44

INTERPRETATION:According to the above table the dividend payout ratio of the year 2011, 2010 & 2009 is 0.22, 0.29 & 0.36% resp.

0.4 0.35 0.3 0.25 0.2 0.15 0.1 0.05 0 2009 2010 2011

45

2)
y y y y y

SOLVANCY RATIO
Debt equity ratio Capital guessing ratio Proprietary ratio Long term fund fixed asset Interest coverage ratio

46

y DEBT EQUITY RATIO

MEANING:This ratio is only another form of proprietary ratio & establishes relationship between the outside long term liabilities & owner funds. OBJECTIVES:The objective of computing this ratio is to measure the relative proportion of debt and equity in fixed asset of a firm. FORMULA:Debt equity ratio =
   

Year Long term liabilities Share capital R&S Share holder fund Ratio

2011 124083176 77659830 679688079 757347909 16.38%

2010 62780244 77659830 569074005 64673385 9.71%

2009 151015449 80874970 540087757 620962727 24.32%

INTERPRETATION

47

According to the above table the debt equity ratio of the year 2011, 2010 & 2009 is 16.38, 9.71 & 24.32% resp.

30

25

20

15

10

0 2009 2010 2011

y CAPITAL GASSING RATIO

This ratio is not mentioned.

48

y PROPRIETARY RATIO
MEANING:The ratio shows the proportion of proprietors fund to total asset employed in the business. The proprietors fund or share holder equity consists of share holder & capital. OBJECTIVE:The objective of computing this ratio is to find out how much the proprietors have finance to purchase asset. FORMULA:Proprietary ratio =
 

Year Share capital R&S Proprietor fund Total asset Ratio INTERPRETATION:-

2011 77659830 679688074 757347909 881431084 85.92%

2010 77659830 569074005 656733835 789529079 81.91%

2009 80874970 540087757 620962752 772543176 80.38%

According to the above table the proprietary ratio of the year 2011, 2010 & 2009 is 85.92, 81.91 & 80.38% resp.

49

87 86 85 84 83 82 81 80 79 78 77 2009 2010 2011

y LONG TERM FUNDS TO FIXED ASSET

MEANING:The fixed asset of business must be purchased out of fixed capital only which included share capital reserve & long term liability.

FORMULA:Long term funds to fixed asset =

  
50

Year Share capital R&S Long term liability Long term fund Fixed asset Ratio

2011 77659830 679688079 124083176

2010 77659830 569074005 62780244

2009 80874970 540087757 151615449 771978176 209821698 3.68%

881431085 709514079 373900955 303209136 2.36% 2.34%

INTERPRETATION According to the above table the long term fund to fixed asset of the year 2011, 2010 & 2009 is 2.36, 2.34 & 3.68% resp.

4 3.5 3 2.5 2 1.5 1 0.5 0 2009 2010 2011

51

y INTEREST COVERAGE RATIO

MEANING The ratio indicates as to how many times the profit covers the payment of interest on debentures & other long term loans. OBJECTIVES The objectives of computing this ratio is to measure the debt serving capacity of a firm so far fixed interest on long term debt & debenture is concerned. FORMULA Interest coverage ratio =


Year PBIT & taxes Interest PBIT Interest Ratio INTERPRETATION

2011 221444557 17222335 2386666892 17222000 13.86times

2010 155022956 17440156 172463112 17440000 9.89times

2009 133745424 18642894 152388318 18643000 8.17times

According to the above table the interest coverage ratio of the year 2011, 2010 & 2009 is 13.86, 9.89 & 8.17times resp.

52

16 14 12 10 8 6 4 2 0 2009 2010 2011

y DIVIDEND COVERAGE RATIO

This ratio is not mentioned.

53

ACTIVITY RATIO
y y y y y y Stock turnover ratio Debtor s ratio Creditor s ratio Fixed asset turnover ratio Current asset turnover ratio Total asset turnover ratio

y STOCK TURNOVER RATIO

MEANING This ratio signifying the efficiency of sales in the stock turnover it shows the number of times the average stock is turned over during the year. OBJECTIVES The objective of computing this ratio is to determine the efficiency with which the inventory is utilized

54

FORMULA Stock turnover ratio = Average stock =

  

Year COGS Op. stock Cl. Stock Average ratio Ratio INTERPRETATION

2011 1625676493 228258544 26890375 469448919 / 2 248274459.5 6.55 times

2010 1343805788 198890316 228258544 427148860 / 2 213574430 6.30 times

2009 1192657932 198890316 198890316 / 2 9944518 11.99 times

According to above table the stock turnover ratio of the year 2011, 2010 & 2009 is 6.55, 6.30 & 11.99 times resp.

55

14 12 10 8 6 4 2 0 2009 2010 2011

y DEBTOR S RATIO
MEANING The ratio shows the number of days taken to collect the dues of credit sales. It shows the efficiency or otherwise of collection policy of an enterprise. OBJECTIVE. The objective of computing this ratio is to determine the efficiency with which the debtor is employed. FORMULA Debtors ratio =


56

Year Debtors B/R Avg. daily sales Ratio

2011 324831362 3102769778 38 days

2010 224957483 2521992910 33 days

2009 213334492 2196465374 35 days

INTERPRETATION According to the above table the debtor s ratio of the year 2011, 2010 & 2009 is 38, 33 & 35 days resp.

39 38 37 36 35 34 33 32 31 30 2009 2010 2011

57

y CREDITORS RATIO
MEANING The no. of days within which amount we make payment to our creditors for credit is obtained from creditor s velocity or creditor s ratio. OBJECTIVE The objective of computing this ratio is to determine the efficiency with which the creditors are managed. FORMULA Creditors ratio =


Year Creditors B/P Credit purchase Ratio

2011 316080193 117182028 69days

2010 227060358 99407270 60 days

2009 194659738 117491065 58 days

INTERPRETATION According to the above table the creditor s ratio of the year 2011, 2010 & 2009 is 69, 60 & 58 days

58

70 68 66 64 62 60 58 56 54 52 2009 2010 2011

y FIXED ASSET TURNOVER RATIO

MEANING To ascertain the efficiency & profitability of business the total fixed asset are to sales to more the sales in relation to the amount invested in fixed asset. OBJECTIVES The objective of computing this ratio is to determine the efficiency with which the fixed asset turnover is utilized.

59

FROMULA FATR = Year Sales Fixed asset Ratio

 

2011 3103019275 373900955 8.30 times

2010 2524290840 303204130 8.33 times

2009 2199026133 209821698 10.48 times

INTERPRETATION According to the above table the fixed asset turnover ratio of the year 2011, 2010 & 2009 is 8.30, 8.33 & 10.48 times.

12

10

0 2009 2010 2011

60

y CURRENT ASSET TURNOVER RATIO

MEANING This ratio is computed to ascertain how efficiently working capital is utilized in business. It is computed by dividing sales by total current asset. FORMULA Current asset turnover = Year Sales Current asset Ratio 2011 3103019275 268290375 2.58%


2010 2524290840 228258544 2.67%

2009 2194016133 198890316 2.39%

INTERPRETATION According to the above table the current asset turnover ratio of the year 2011, 2010 & 2009 is 2.58, 2.67 & 2.39% resp.

61

2.7 2.65 2.6 2.55 2.5 2.45 2.4 2.35 2.3 2.25 2009 2010 2011

y TOTAL ASSET TURNOVER RATIO

MEANING The fund used in business use employed in both fixed asset & current asset FORMULA Total asset turnover ratio = Year Sales Total asset Ratio 2011 313019275 881431085 3.52%


2010 2524290840 789529079 3.20%

2009 2194016133 772543176 2.85%

INTERPRETATION

62

According to the above table the total asset turnover ratio of the year 2011, 2010 & 2009 is 3.52, 3.20 & 2.85% resp.
4 3.5 3 2.5 2 1.5 1 0.5 0 2009 2010 2011

COMMON SIZE BALANCE SHEET

2011 PARTICULARS AMOUNT Share capital 77659830 R&S 679688079 Secured loan 124083176 Unsecured loan 124083176 Total 881431085 Gross buck 557230023 Depreciation 231082586 Capital work in 47753518 progress Net 373900955 % 8.81 77.11 14.08 14.08 100 63.22 26.22 5.42 2010 AMOUNT 77659830 569074005 62780244 80015000 789529079 458927320 218916018 63197828 % 9.84 72.08 7.95 10.13 100 58.13 27.73 8.00 2009 AMOUNT 818074970 540087757 151015444 565000 772543176 412567869 202746171 % 10.47 69.91 19.55 0.078 100 53.40 26.24

42.42 303209130 38.40 209821698

27.16
63

Investment Diff. tax asset Differed tax liability Inventories Sundry debtors Cash & bank balance Loan & advance Current liability Provision Net current asset

68360000 5450518 26571488 268290375 324831362 608075608 285396308 751626152 274676401 1026302553

7.76 1.00 3.01

81537000 6944008 26839978

10.33 81537000 87.95 17726938 3.40 27374186

10.55 27.16 3.54 25.74 28.26 65.04 22.06 59.40 18.17 77.57

30.44 228258544 28.91 198890316 36.85 224951483 28.49 218334492 68.99 493381832 62.49 502446643 32.38 85.27 31.16 116.4 212745370 537389832 197268478 734658310 26.95 68.06 24.99 93.05 170425087 458910780 140354037 599264814

INTERPRETATION
1) SHARE HOLDER FUND a) Share capital This ratio suggests company s share capital. The share capital in the year 2009, 2010 & 2011 is 10.47, 9.84 & 10.47% resp. b) Reserves & surplus This ratio suggests company s reserves & surplus of the firm. The ratio of this firm in the year 2009, 2010 & 2011 is 69.9%, 72.88% & 77.11% resp.

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2) LOAN FUND a) Secured funds This ratio suggests the secured fund of the company. The ratio in the year 2009, 2010 & 2011 is 19.55, 7.95 & 14.08% resp. b) Unsecured loan This ratio suggests the unsecured loan of the company. The ratio in the year 2009, 2010 & 2011 is 0.078, 10.13 & 14.02% resp.

3) Application of fund a) Fixed asset This ratio suggests the company s asset. The ratio in the year 2009, 2010 & 2011 is 53.40, 58.13 & 63.22% resp. a) Less/depreciation This ratio tells us the depreciation of the company s asset. The depreciation in the year 2009, 2010 & 20011 is 26.24, 27.73 & 26.22% resp.

4) Capital work in progress. The capital work in progress ratio of the year 2010 & 2011 is 8.00 & 5.42% resp. a) Net The net buck ratio in the year 2009 & 2011 is 27.16, 42.42% resp.
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b) Investment The investment ratio in the year 2009, 2010 & 2011 is 10.55, 10.33 & 7.76% resp. c) Differed tax asset Differed tax asset in the year 2009 & 2011 difference is only of 1.29%. d) Differed tax liability This ratio suggests the companies different tax liability is less in differed tax asset in the ratio. The ratio in the year 2009 & 2011 is in decreasing stage the difference is of 0.51% only.

5) Current asset, loan & advances a) Inventories The inventories ratio in the year 2009 was 25.75% it was 28.91% in the year 2010 and it was 30.44% in the year 2011. b) Sundry debtors The ratio of sundry debtors in the year 2009, 2010 & 2011 is 28.26, 28.49 & 36.85% resp. c) Cash & bank balance The ratio of cash & bank balance in the year 2009, 2010 & 2011 is 65.04, 62.49 &68.99 % resp. d) Loan & advances
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The loan & advances ratio in the year 2009, 2010 & 2011 is 22.06, 26.95 & 32.62% resp.

e) Current liability The current liability of the company in the year 2009, 2010 & 2011 was 59.40, 68.09 & 85.27% resp.

y Provision There were rapid increases in the year from the year 2009 to 2011. The ratio was 18.17, 24.99 & 31.16% resp.

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COMMON SIZE PROFIT & LOSS A/C OF TTK HEALTH CARE LTD

PARTICULARS
INCOME Sales Excise duty related to sales Net sales Other income EXPENDITURE Goods comp. & excise duty Expenses Transfer from revaluation PROFITE BEFORE TAX Provision for current tax Deferred tax Benefit tax PROFITE AFTER TAX

2011
100 0.01 99.99 1.63 101.62 52.39 41.46 2.56 0.02 7.14 2.35 2.39 4.74

2010
100 0.09 99.91 1.49 101.40 53.23 41.31 0.74 0.02 8.24 2.12 2.53 3.62

2009
100 0.12 99.89 2.28 102.16 54.24 41.05 0.82 0.02 5.17 0.98 2.50 3.58

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INTERPRETATION
1) INCOME a) Sales Sales is a income b) Excise duty relating to sales. In the year 2009, 2010 & 2011 excise duty of the company was 0.1, 0.09 & 0.12% resp. c) Net sales In the year 2009, 2010 & 2011 net sales the company was 99.88, 99.91 & 99.99 % resp. d) Other income In the year 2009, 2010 & 2011 the other income of the company were 2.28, 1.49 & 1.63% resp.

2) Expenditure
a) Good consumption and excise duty In the year 2009, 2010 & 2011 the goods consumption and excise duty was 54.24, 53.23 & 52.39 %resp. b) Expenses In the year 2009, 2010 & 2011 the expenses of the company was 41.05, 41.31 & 41.46% resp.
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c) Deprecation In the year 2009, 2010 & 2011 the depreciation of the company was 0.82, 0.74 & 0.65% resp. d) Transfer from revolution stage In the year 2009, 2010 & 2011 the transfer from revaluation stage was 0.02 it was same in all the year. 3) PROFIT BEFORE TAX a) Less provision for tax In the year 2009, 2010 & 2011 the less provision for tax is 0.98, 2.12 & 2.35% resp. b) Differed tax In the year 2009, 2010 & 2011 the differed tax is 1.99, 0.41 & 0.39% resp. c) Benefit tax In the year 2009, 2010 & 2011 the benefit tax is 2.50, 2.53 & 2.39% resp. d) Profit after tax In the year 2009, 2010 & 2011 the profit after tax is 3.58, 3.62 & 4.74% resp.

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COMPARATIVE STATEMENT OF TTK HEALTH CARE LTD

PARTICULARS 1) Share holder fund Share capital Reserves & surplus 2) Loan funds Secured loan Unsecured loan Total Application of fund 1) Fixed asset Gross buck Less depreciation Add capital work in progress Net block Investment Different tax Different tax asset Different tax liability Current asset loan & advances Inventories Sundry debtors

2011

2010

2009

8.81 77.11 14.08 100

9.84 72.08 7.95 10.13 100

10.47 69.91 19.55 0.07 100

63.23 27.22 5.42 42.43 7.76

58.13 27.73 8.00 38.4 10.33

53.40 26.24

27.16 10.55

0.62 3.01

0.88 3.40

2.29 3.54

30.44 36.85

28.91 28.49

25.74 26.26
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Cash & bank balance Loan & advance Total Less current liability & provision Current liabilities Provision Net current asset Miscellanies expenses Total

68.99 32.38 168.66

62.49 26.95 196.84

65.04 22.06 141.06

85.27 31.16 116.44 52.22 100

68.06 24.99 93.08 53.79 100

59.54 18.77 77.57 63.53 100

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COMPARATIVE PROFIT & LOSS A/C OF TTK HEALTH CARE

PARTICULARS INCOME Sales Excise duty related to sales Net sales Other income EXPENDITURE Goods comp. & excise duty Expenses Deprecation Transfer from revaluation res. Total Profit before tax Provision for tax Current tax Deferred tax Benefit tax Profit after tax

2011 100 0.01 99.99 1.63 101.62 52.39 41.46 0.65 0.02 0.06 7.14 2.35 3.39 2.39 4.74

2010 100 0.09 99.91 1.49 101.40 53.23 41.31 0.74 0.02 0.72 6.14 2.12 0.41 2.53 3.62

2009 100 0.12 99.89 2.28 102.16 54.24 41.05 0.82 0.02 0.79 5.17 .098 1.09 0.43 2.50 3.58

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INTRODUCTION TO CASHFLOW
Introduction
Cash is the most liquid asset of a business. All business transactions ultimately results into cash inflow or out flow. Hence a statement that show cash flow is considered to be an important one the business should have sufficient cash in hand so that the liabilities can be paid A statement showing inflow of cash and outflow of cash during the last year and as a result the balance of cash at the end of the year is known as cash flow statement of the year The institute of chartered accountant of India has issued accounting standard three for preparing cash flow statement according to this standard the cash inflow and outflow are to be shown under three headings a) Cash flow from operating activities b) Cash flow from investing activities c) Cash flow from financing activities

Cash flow from operating activities This section includes cash flow from the principle revenue generating activities can be computed by two methods Direct method and Indirect method

1)

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2) Cash flow from investing activities Cash flow from investing activities is in flow related to activities that are interred to generate income. This includes cash inflow and outflow from sales and purchase of assets

3) Cash flow from financial activities These cash flows related to transaction with stock holder and creditor such as issue of share capital purchase of treasury and stock dividend payment

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Benefits of cash flow statement

As cash flow statement is useful in management in short term planning of liquidity. It is prepared by comparing figures of last two years. The advantage of cash flow is follow 1) 2) 3) 4) 5) Efficient cash management Useful for internal financial management Information about cash recipient and payment Useful foe control Easy in obtaining funds

Efficient cash management If the finance manager has a clear idea of cash receipt and payment cash resources can be efficiently managed. If the cash payment are planned at a time when enough cash inflow. It is possible manage business with minimum business capital 2) Useful for internal financial management The management can plan out payment of dividend repayment of long term loans purchase of machines and equipment etc. 3) Information about cash receipt and payment Such a statement will give information about the trend of cash receipt and payment such information is useful in the management and future contingencies.

1)

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4)

Useful for controls This historical cash flow statement prepared for last year is useful for comparing the figure of cash budget and point of difference may be located.

5) Easy in obtaining funds By comparing the figures of cash flow statement and cash budget the cash planning and control becomes more effective liabilities are easily paid as and when they mature.

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CASH FLOW OF TTK HEALTH CARE LTD

PARTICULARS Cash flow operating activities Net profit before tax Adjustment for depreciation Profit/loss on sales of asset Profit/loss on sales of investment Provision for diminution value of investment Interest paid Dividend received Operating profit before working capital changes Other receivables Investors Trade payable Cash generated from operation Direct taxes paid Cash flow before extraordinary items Extraordinary items Net cash from operating activities Cash flow from investment activities Purchased of fixed asset Sales of fixed asset Provision for limitation in value of investment Interest/dividend received 2011 2010 2009

2214.44 1550.23 1337.46 197.73 181.80 174.72 4.85 4.58 18.50 92.65 29.77 172.22 174.40 186.43 5.11 0.77 20.12 306.21 350.85 322.13 2520.65 1901.08 1659.58 933.32 400.32 2143.36 3329.37 7919.8 2537.39 29.58 293.68 784.79 2362.61 459.80 1902.81 449.75 381.45 828.23 1656.61 375.21 1281.40

2537.39 1902.81 1281.40

923.55 1128.24 486.01 9.63 12.11 23.73 29.71 5.11 0.77 50.17
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Investment in bonds & share of investment

224.24 714.16

115.36

500.00 942.16

Cash flow from financing activities Reduction due to buy back in share capital Securities premium Bank borrowing short term Public deposit/other loan Interest paid Dividend paid Net cash used in financing activities Net increases in cash & cash equipment Cash & cash equipment as at the beginning of the year Cash & cash equipment as at the end of the year

187.12 172.22 316.95 676.29 1146.94

32.15 309.49 82.35 5.50 174.40 274.20 878.09 90.64

2.29 18.97 193.18 10.55 186.30 284.66 299.72 39.52

4933.82 5024.46 4984.94 608.76 4933.82 5024.46 1146.94 90.64 39.52

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INTERPRETATION A) Cash flow from operating activities The operating activities in which working capital changes from 1902.8lakh to 2520.65 lakhs from year 2010-2011 which means that the cash flow higher as compared to the previous year.

B) Cash flow from investment activities As the co invested funds in fixed asset in year 2010 is 1128.24 investments is done more in the year 2010 than any other is 714.16 which is less than previous year.

C) Cash flow from financing activities Cash flow of the company TTK Health care ltd in the year 2011 is higher as compared to previous year it is 1146.94 lakhs in 2011, 90.64 laths in 2010 and 39.52 in 2009 which less compared to the year 2011

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RATIO OF TTK HEALTH CARE LTD AT BALANCE

PARTICULARS LIQUID RATIO Current ratio Liquid ratio Quick ratio PROFITABILITY RATIO (related ratio) Gross profit Net profit Operating ratio Related to investment Related to capital employed Return on share holder equity Return on equity share capital Return on total asset Earnings per share Dividend per share Dividend pay ratio Price earnings ratio SOLVENCY RATIO Debt equity ratio Capital guessing ratio Proprietary ratio Long term funds to fixed cost Interest coverage ratio 2011% 2010% 2009% 1.60 1.24 0.81 1.76 1.34 0.92 2.00 1.57 1.09

3.59 96.19

3.62 95.36

4.74 94.49

19.74 1 197.37 12.61 9.74 5.59 0.26

24.31 27.08 14.11 1.44 47.53 189.57 13.77 18.66 11.29 18.96 3.39 4.08 0.29 0.22

24.32 8038 3.68 8.17

9.71 81.91 2.34 9.89

16.38 85.92 2.36 13.86

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ACTIVITY RATIO Stock turnover ratio Debtors ratio Creditors ratio Fixed asset turnover ratio Current asset turnover ratio Total asset turnover ratio

11.99 35 58 10.48 2.39 2.85

6.30 33 60 8.33 2.67 3.20

6.55 38 69 8.30 2.58 3.52

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CONCLUTION
It was the wonderful experience preparing this report on the company TTK HEALTH CARE LTD. I came to know many new interesting things while preparing this financial report I understand the important at financial statement by such statement one can understand the whole structure of the company. According to the present financial report TTK HEALTH CARE LTD Company is in good condition & will grow well in future. It had made growth of 76544677 as from 2009 to 2011. So its development can be seen gradually year after year.

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BIBLOGRAPHY
www.ttkhealthcareltd.com www.wikipedia.com

BOOKS:Financial management sudarshan ready

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