Project 1

FUNDS FLOW ANALYSIS
CHENNAI CUTTING DIES
SCOPE OF STUDY
Funds flow statement is a analysis by which his study the change in the financial position
beginning and ending of financials statement dates of the CCD. The funds flow statement is
prepared by comparing two balance sheets and with help of such other information derived from
the account as may be needed.
1. Statement changes in working capital of CCD.

2. Statement of source and application of CCD.
The causes of changes in cash position between dates of two balance sheet of the CCD. This
statement is very much similar to the statement of changes in financial position prepared on
working capital.
OBJECTIVE OF STUDY
1.
2.
3.
4.
To study the different sources and applications of the funds of CCD.

To study the different working capital of CCD.
To analysis the changes of financial position of CCD between two balance sheet.
To find out the source from which additional funds were derived and the use to which
their source were put.
VCR Institute of Management Studies Page 1
FUNDS FLOW ANALYSIS
LIMITATION OF STUDY
1. Time has been a limited factor and it has been difficult to analyze the various aspect of
finance within the prescribed time.
2. Financial statements are prepared on the basis of certain accounting concepts and
conventions.
3. Any change in the methods or procedures of accounting system limits the utility of
financial statements. The analysis is based on the secondary data that is financial reports
of 5 years.
FUNDS FLOW ANALYSIS
RESEARCH METHODOLOGY
The study had conducted based upon the financial statement in annual reports and accounts of
the firm. Which are published annually by the company.
O Data collection:
Data means information. Data was collected secondary data.
O Secondary data:
FUNDS FLOW ANALYSIS
The data has been collected from the annual reports of last 4 years that is the balance sheet profit
and loss account of the company have been taken from the audit report of company. The annual
report of the company was the most direct and easily obtainable source of financial information.
INTRODUCTION
INTRODUCTION TO FINANCIAL MANAGEMENT:
Financial management has always vital and an integrated part of business management.
Financial management is concerned with the planning and controlling of the firms financial
resource. It is often said that the financial management has receives less emphasis as compared
to topics like production and marketing.
However the task of financial planning and on tolling will assume relative more
important role than in the past due to certain changes that have taken place or will take place in
economy.
FUNDS FLOW ANALYSIS
Factors such as increasing pace of industrialization, technological innovations land

inventions, raising price levels, increasing influence of government in financial matters etc.
definition of financial management.
Financial management as an application of general managerial principles to the area of

financial decision-making.
-Howard and Upton
Financial management is an area of financial decision making harmonizing individual

motives and enterprise goals.
- Western and Brigham
AICPA (American Institute of Certified Public Accounts) says financial statements are
prepared for the purpose of presenting a periodical review or reports on the progress by the
management and deal with
The status of investments in the business and
The results achieved during the period under review.
IMPORTANCE OF FINANCE:
The developments during past decades have proved the finance function as
foremost
important managerial function, now a day the policy statement of business Concern. In variably
includes these four activities.
(1). Production
(2). Personnel or Human Resource
(3). Marketing
(4). Finance
FUNDS FLOW ANALYSIS
Finance provides the necessary for continued business operations of all types. As A
matter of fact, financial decision is involved so extensively in each type of business Activity that
it may be rightly called a binding force; it is so intermingled with other Functions- Production,
Marketing, and Personnel etc., that there is very difficult in
Appreciating the part it Place. Finance is concerned with the task of providing funds to
the enterprises on the term that is most favorable towards the attainment of the organizational
goals objects. The function of finance is not merely furnishing funds to the organization.
Finance may be defined as the provision of money at the time when it is required. Finance may
refer to the management of flows of money through an organization.
FUNDAMENTAL PRINCIPLE OF FINANCE:

A business proposal-regardless has whether it is a new investment or acquit Ion of another
company or restructuring initiative raises the value of the firm, only if the Present value of the
future stream of net cash benefits expected from the proposal is greater Than the initial cash
outlay required to implement the proposal.
The difference between the present value of future cash benefits and initial outlay
Represent
outlay represents the net present value of NPV of the proposal.
NPV = Present value of future cash benefits Initial cash outlay
FUNDS FLOWS STATEMENT

Funds Flow Statement is an analytical tool in the hands of financial manager. The basic
purpose of this statement is to indicate on historical basis the changes in the working capital i.e.,
where funds came from and were there are used during a given period.
FUNDS FLOW ANALYSIS
Funds Flow Statements summarize a firms inflow and outflow of funds. Simply put, it
tells investors where funds have come from and where funds have gone. The statements are often
used to determine whether companies efficiently source and utilize funds available to them.
DEFINITION:
"the fund flow statement describes the sources from which additional funds there derived
and the uses to which these funds were. Put".
-R.K.Anthony
"a statement of sources and application of funds is a technical device designed to analyses
the changes in financial conditions of a business between two dates.
-R.A.F bulk
"it is a statement which highlights the underlying financial movements and explains the
changes of working capital from one point of time to another".
-Bier man
Funds flow statements are prepared by taking the balance sheets for two dates
representing the coverage period. The increases and decreases must then be calculated for each
item. Finally, the changes are classified under four categories:
(1) Long-term sources,
(2) Long-term uses,
(3) Short-term sources,
(4) Short-term uses.
It is also important to zero out the non-fund based adjustments in order to capture only
the changes that are accompanies by flow of funds. However, income accrued but received and
FUNDS FLOW ANALYSIS
expenses incurred but not received reckoned in the profit and loss statement should not be
excluded from the profit figure for the fund flow statement.
Fund flow statements can be used to identify a variety of problems in the way a company
operates. For example, companies that are using short-term money to finance long-term
investments may run into liquidity problems in the future. Meanwhile, a company that is using
long-term money to finance short-term investments may not be efficiently utilizing its capital.
A summary of main points of differences between these two is give below:1. Balance sheet is a statement showing the financial position of the concern on a particular
date. The asset side portrays the development of resources in various types of properties
an liabilities side indicates the manner in which these resources are obtained. It shows all
assets and liabilities whether current or fixed, tangible or intangible etc., while Funds
Flow Statement shows the changes in current assets an current liabilities during a
particular period of time.
2. Balance Sheet shows the total financial position on a particular date and in this way, it is
of a historical nature and therefore, its utility is very limited for the management. On the
other hand, Funds Flow Statement is a comparative statement of assets and liabilities and
depicts the changes in working capital during the period of two Balance sheets.
3. Funds Flow Statement is an analysis and control device for the management.
Management can ensure the long term an short term solvency of the firm by studying the
internal funds flow cycles. It is a modern technique of knowing the inflows and outflows
of funds during a particular period. Balance Sheet represents the balance of various assets
an liabilities and does not present analysis of any kind.
4. There are two views of h financial position of the firm-long term an short-term. Shortterm financial position means the technical solvency of the firm in the near future while
on the other hand, long-term financial position means future financial structure of the
firm. Both are inter-relate but there is a differences in their analysis. The short-term view
of the financial position of the firm ca not be had from the Balance Sheet
FUNDS FLOW ANALYSIS
PREPARATION OF FUNDS FLOW STATEMENT:

In order to prepare a fund flow statement it is necessary to mind out the sources and applications of
funds.
SOURCES OF FUNDS:
1. Funds from Operation:
Fund from operation is the only internal source of funds. Some adjustments are to made in
calculative funds from operation to the net profit given in the financial statement.
2. Calculation of Funds from Operation:
Start with the net profit given in the profit and loss account.
OBJECTIVE OF FUND FLOW STATEMENT:

Fund Flow Statement is a widely used tool in the hands of financial executives for
analyzing the financial performance of a concern. Funds keep on moving in a business which
itself is based on a going concern concept. In a narrow sense, it means cash only and a funds
flow statements prepared on this basis is called as Cash Flow Statement. Such a statement
enumerates net effects of the various business transactions on cash and takes into account
receipts and disbursements of cash. In a broader sense, the term Fund refers to money values in
whatever form it may exist. Here Funds means all financial resources in the form of men,
Materials, Money, Machinery etc. But in a popular sense, the term Funds, means working
capital, i.e. the excess of current assets over current liabilities. When the funds move inwards or
outwards, they cause a flow or rotation of funds. The word Fund here means net working
capital.
FUNDS FLOW ANALYSIS
The main purposes of Fund Flow Statement are:

1. To help to understand the changes in assets and assets sources which are not readily
evident
in the income statement of financial statement.

2. To inform as to how the loans to the business have been used.
3. To point out the financial strengths and weakness of the business.
The utility of this statement can be measured on the basis of its contributions to the
financial management. It generally serves the following purposes:(1)Analysis of Financial Position
The basic purpose of preparing the statement is to have a rich into the financial operations of the
concern. It analyses how the funds were obtained and used in the past. In this sense, it is a
valuable tool for the finance manager for analyzing the past and future plans of the firm and their
impact on the liquidity. He can deduce the reasons for the imbalances in uses of funds in the past
a take necessary corrective actions. In analyzing the financial position of the firm, the Funds
Flow Statement answers to such questions as-
1. Why were the net current assets of the firm down, though the net income was up or
vice versa?
2. How was it possible to distribute dividends in absence of or in excess of current income
3.
4.
5.
6.
7.
for the period?

How was the sale proceeds of plant and machinery used?
How was the sale proceeds of plant and machinery used?
How were the debts retired?
What became to the proceeds of share issue or debenture issue?
How was the increase in working capital financed?
Though it is not an easy job to find the definite answerers to such questions because
funds derived from a particular source re rarely used for a particular purpose. However, certain
FUNDS FLOW ANALYSIS
useful assumptions can often be made and reasonable conclusions are usually not difficult to
arrive at.
(2) Evaluation of the Firm's Financing:

One important use of the statement is that it evaluates the firm' financing capacity. The
analysis of sources of funds reveals how the firm's financed its development projects in the past
i.e., from internal sources or from external sources. It also reveals the rate of growth of the firm.
(3) An Instrument for Allocation of Resources:

In modern large scale business, available funds are always short for expansion
programmers and there is always a problem of allocation of resources. It is, therefore, a need of
evolving an order of priorities for putting through their expansion programmers which are phase
accordingly, and funds have to be arranged as different phases of programmers get into their
stride. The amount of funds to be available for these projects shall be estimated by the finance
with the help of Funds Flow Statement. This prevents the business from becoming a helpless
victim of unplanned action.
(4) A Tool of Communication to Outside World:

Funds Flow Statement helps in gathering the financial states of Business. It gives an
insight into the evolution of the present financial position and gives answer to the problem
'where have our resources been moving'? In the present world of credit financing, it provides a
useful information to bankers, creditors, financial, it provides a useful informations and
government etc. regarding amount of loan required, its proposes, the terms of repayment an
sources for repayment of loan etc. the financial manager gains a confidence born out of a study
of Funds Flow Statement. In fact, it carries information regarding firm's financial policies to the
outside world.
FUNDS FLOW ANALYSIS
(5) Future Guide: An analysis of Funds Flow Statements of several years reveals certain
valuable information for the financial manager for planning the future financial requirements of
the firm and their nature too i.e. Short term, long-term or midterm. The management can
formulate its financial policies based on information gathered from the
Analysis of such statements. Financial manager can rearrange the firm's financing more
effectively on the basis of such information along with the expected changes in trade p payables
and the various accruals. In this way, it guides the management in arranging its financing more
effectively.
Analysis of such statements. Financial manager can rearrange the firm's financing more
effectively on the basis of such information along with the expected changes in trade p payables
and the various accruals. In this way, it guides the management in arranging its financing more
effectively.
ADVANTAGES OF THE FUNDS FLOW STATEMENT
It provides information about how funds are obtained and in the process of decision
making.
It registers changes in the flow of funds during a given period of time.
It is supplementary to the conventional financial statements.
It indicates how funds are generated from the different financial resources of a
corporation and how the reservoir of its assets is created. In other words it depicts
changes in the financial structure of the corporation.

It is an important tool in the hands of the financial manager deter5mines the financial
consequences of business operations. It explains why in spite of making profits a
corporation is illiquid position.

Indicates how funds are generated from the different financial resources of a corporation
and how the reservoir of its assets is created. In other words it depicts changes in the
financial structure of the corporation.
FUNDS FLOW ANALYSIS
It is an important tool in the hands of the financial manager in the process if decision
making.
It determines the financial consequences of business operations. It explains why in spite
of making profits a corporation is illiquid position.

It enables the financial manager to obtain answers to a number of questions regarding the
amount of loan requirements the purpose for which it may be required the terms of
repayment the source of repayment etc.

It may enable the financial manager to allocate resources to productive investments.
It is closely related to the normal business decision making process accounting statements
balance sheets and income statements and is related to a time span.

It any enable the management to take decision on planning a dividend policy on
challenge out a programmed of the financial re- organization.
LIMITATIONS OF FUNDS FLOW ANALYSIS:
It is essentially historic in nature and projected funds flow statement cannot be prepared
with much accuracy.

It cannot be reveal continues changes.
It is not an original statement but simply a re - arrangement of data given in the financial
statements.
DIFFERENT NAME OF FUNDS FLOW STATEMENT:

1. A statement of sources and Uses of funds.
2. A statement of Sources and Application of funds.
3. Where got and where gone Statement.
4. Inflow and out flow of funds statement.
FUNDS FLOW ANALYSIS
MAIN PURPOSE OF FUNDS FLOW STATEMENT:

1.
2.
3.
4.
5.
To help to understand the changes in assets and which are not evident
Financial statement or I the income statement.
To inform on to how the loans to the business has been used.
To point out the financial strengths and weakness of the business.
To help in planning sound dividend policy.
PROCEDURE FOR PREPARING A FUNDS FLOW STATEMENT:

(1) The preparation of funds flow statement consists of 2 parts.
(2) Statement or schedule of changes in working capital.
(3) Statement of sources and Applications of funds.
STATEMENT OR SCHEDULE OF CHANGES IN WORKING CAPITAL:

Working capital means the excess of current assets over current liabilities. Statement of
changes in working capital is proposed to show the changes in the working capital between two
balance sheets data. This statement is prepared with the help of current assets and current
liabilities derived from two balance sheets.
Working Capital = Current Assets Current Liabilities
FUNDS FLOW ANALYSIS
While preparing a schedule of changes in working capital, it should be noted that
Increase in Current Assets, Increases the Working Capital.
Decrease in Current assets, Decrease the Working Capital.
Increase in Current Liabilities, Decreases the working capital.
Decrease in Current Liabilities, Increases the Working Capital.
PROFORMA OF STATEMENT OF CHANGES IN WORKING CAPITAL
Base
Year
Curre
nt
Year
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
Income tax (advance tax)

Sales tax
Total Current assets
xxx
xxx
xxx
xxx
xxx
xxx
Current liabilities
Trade creditors
xxx
xxx
PARTICULAR
Current assts (CA)
Inventories:
Raw material
Consumable stores
Finished goods
Sundry debtors
Cash in hand
Balance with bank
Other current assets:
Deposits
Changes in working
Capital
Increasin Decreasin
g
g
FUNDS FLOW ANALYSIS
Dealers deposits
Expenses payable
Total Current liabilities
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
Working Capital (Current assets

- current liabilities)
xxx
xxx
Net Increase/ decrease working

capital
xxx
****
*
***
xxx
******
**
********
********
STATEMENT OF SOURCES AND APPLICATION OF FUNDS:
Funds flow statement is a statement, which indicates various sources for which funds
have been obtained during a chain period and the u3es nr applications to which these funds have
been put during that period.
1. Sources of funds
2. Application of Funds.
FUNDS FLOW ANALYSIS
STATEMENT OF SOURCES AND APPLICATIONS
Particulars
Amount
Particulars
(Rs)
Sources of funds
Application of funds
Amount(Rs)
FUNDS FLOW ANALYSIS
Funds
from
trading
factitively or operating
Profit Issue of shares
of
costs
in .
operations
Repayment
and debentures
Receipts
Funds
of
debentures
dividend
and Interests
.
Sales proceeds of Non
current asset long term
Borrowings
Reduction
Capital
in
share
Capital
Interest
Decrease
in
and
dividend
paid [Payment of Long
working
..
term loans.
Increase
in
working
capital
REVIEW OF LITERATURE
The funds flow statement is a statement, which shows the movement of funds and is a
report to the financial operations of the business undertaking. It indicates various means by
which funds were obtained during a particular period and the ways in which these find were
employed.
FUNDS FLOW ANALYSIS
In simple, the funds flow statement is a statement of sources and application of funds. In
short, it is a technical device designed to high light the change in the financial condition of a
business enterprise between tow Balance Sheets.
According to Robert Anthony the funds flow analysis describes the sources fro which
additional funds were derived and the uses to which these funds were put.
According to Fouke, A Statement of sources and Applications of funds is a technical
device designed to analyze the changes in the financial position of a business enterprise between
two rates.
Finds flow statement is widely used by the financial analyst and credit granting
institution and financial managers in performance of their jobs. It has become a useful tool in
their analytical kit. This is because the financial statement like income statement and - balance
sheet have limited role to perform, Income statement measures flows restricted to transaction that
pertain to rendering of good and services to customers. The balance sheet is merely a static
statements these statements do not sharply focus those major financial transactions, which have
behind the n\balance sheet changes.
DATA ANALYSIS AND INTERPRETATION
FUNDS FLOW STATEMENT ANALYSIS FOR THE YEAR ENDED 31 ST

2007-2008
statement of changes in working capital 2007-2008
(Rs in crores)
FUNDS FLOW ANALYSIS
particulars
2007
2008
Increase
Decrease
current assets
cash in hand
10801657
11582492
cash at bank
2165179
475225
deposits & advance
5130000
car loan
15022309
closing stock
8476200
780835
5130000
52000000
1689954
36977691
3212000
5264200
Total current assets(A) 41595345 72399717
Current liabilities
Sundry creditors
Over drafts
136840102 89743795
100900450 96536531
Total current liabilities 237740552 186280326 37758526

(B)
Working capital (A-B)
196145207 113880609
47096307
4363919
97684380
FUNDS FLOW ANALYSIS
STATEMENT OF CHANGING IN WORKING CAPITAL 2008-2009 (Rs in crores)

FUNDS FLOW ANALYSIS
Particular
2008
2009
Increase
Decrease
Current assets
Sundry debtors
72356202
143949008
Cash in hand
11582492
1233628
Cash at bank
475225
Deposits & advance
Closing stock
Total current assets
5130000
10348864
475225
5130000
3212000
92755919
71592806
5321200
2109200
155633836
(A)
Current liabilities
Sundry creditors
Sundry creditors for
13986855
120149585 30405790
12529900
12529900
expenses
bank over draft
96536531
91889023
4647508
FUNDS FLOW ANALYSIS
FUNDS FLOW STATEMENT ANALYSIS FOR THE YEAR ENDED 31ST 2008-2009
DATA ANALYSIS A DAT

FUNDS FLOW ANALYSIS
Particular
2009
2010
Increase
Decrease
Current assets
Sundry debtors
Cash in hand
Deposits & advance
Closing stock
143949008
1233628
5130000
53212000
155633836
30157122
24709831
5130000
4153000
13791886
23476203
0
49059000
64149953
(A)
Current liabilities
Sundry creditors
120149585
88918122
31231463
FUNDS FLOW ANALYSIS
Sundry creditors
12529900
12529900
expenses
bank over draft
91889023 80524209
11364814
Total current
Liabilities (B)
Working capital(A-B)
224568508
68934672
169442331 23476203
217977063
105292378
Increases in working
36357706
Capital

FUNDS FLOW ANALYSIS
Particular
2010
2011
Increase
Decrease
Current assets
Sundry debtors
Cash in hand
Deposits & advance
30157122
24709831
5130000
Closing stock
4153000
Cash in bank
64149953
188587375
158430253
27872382
3162551
9441187
4311187
5621500
49610151
1468500
49610151
281132595
(A)
Current liabilities
Sundry creditors
88918122
210157910
679030212
FUNDS FLOW ANALYSIS
Sundry creditors
12529900
12529900
expenses
bank over draft
80524209
80524209
Total current
Liabilities (B)
Working capital(A-B)
169442331
210157910 167372491
105292378
772084321
70974685
Increases in working
Capital
FUNDS FLOW STATEMENT 2007-2008

34317693
FUNDS FLOW ANALYSIS
source
AMOUNT
SHARE CAPITAL
176570556
CAR LOAN
67022309
Fund from operation
202663276
DECREASE OF WORKING
Application
FIXED ASSETS
DEPOSISTS
82264598
CAPITAL
528520739
528520739
INFERENCE:
The above statement shows that decrease in working capital of Rs 8.2crores.
AMOUNT
528418139
102600
FUNDS FLOW ANALYSIS
source
AMOUNT
Application AMOUNT
SHARE CAPITAL
266865662
FIXED ASSETS
CAR LOAN
960556
DEPOSISTS
609367196
102600
Funds from
operation
380220168
INCREASE IN WORKING
CAPITAL
648046384
648046384

INFERENCE:
The above statement shows that Increase in working capital of Rs 3.8crores.
INFERENCE:
The above statement shows that Increase in working capital of Rs 3.6crores.
38576590
FUNDS FLOW ANALYSIS
source
AMOUNT
Application AMOUNT
SHARE CAPITAL
577801165
CAR LOAN
581613
HOUSING LOAN
1435013
FIXED ASSETS
DEPOSISTS
INCREASE IN WORKING
CAPITAL
Funds from
322852547
operation
902670338
902670338
853781458
14571187
34317693
FUNDS FLOW ANALYSIS
source
AMOUNT
Application AMOUNT
SHARE CAPITAL
388178576
FIXED ASSETS
CAR LOAN
790617
DEPOSISTS
HOUSING LOAN
587076OO
INCREASE IN WORKING
CAPITAL
Funds from operation
337198561
447676793
447676793
74017926
102600
36357706
FUNDS FLOW ANALYSIS
INFERENCE:
The above statement shows that Increase in working capital of Rs 9crores.
SUGGESTIONS
As the company is paying huge amount as interest to bank and financial institute, it is better for
the company to concentrate on moderating net worth.
The company should take proper care in financing the assets. As far as possible working capital
should be used for long term.
The company must reduce the operating expenses.
The company should decrease its current liabilities to increase its working capital.
FUNDS FLOW ANALYSIS
CONCLUSION
Except of the first year the study period it is observed that the fund for operations is on profit.
Except of the first year of the study of period, funds were utility for financing the working capital
requirements.
The study revealed a mixed trend of application and source of funds in respect of secured and
unsecured loans.
FUNDS FLOW ANALYSIS
FINDINGS
O The company assets decrease RS3.3crores and 7.2crores.

O (2007-2011) the company has been in profit.
O To increase current liabilities from3.3crores in the year 2007 to RS6.9crores in 2011
The financial level of the company is not satisfactory.
FUNDS FLOW ANALYSIS
BALANCE SHEET OF CHENNAI CUTTING DIES (2007-2011)
2007
2008
2009
2010
2011
222614690
305803449
303563747
436611179
417170279
particular
CURRENT ASSETS:
FIXED ASSETS
FUNDS FLOW ANALYSIS
DEPOSITS
&
ADVANCE
5130000
5130000
5130000
5130000
9441187
83853503
72356202
143949008
30157122
188587375
10801657
11582492
1233628
24709831
27872382
2165179
475225
49610151
8476200
3212000
5321200
4153000
5621500
333041230
398559368
459197583
500761132
698302874
SUNDRY DEBTORS
CASH IN HAND
CASH AT BANK
CLOSING STOCK
TOTAL CURRENT
ASSET
CURRENT
LIABILITIES:
SHARE CAPITAL
SUNDRY
CREDITORS
FUNDS FLOW ANALYSIS
SUNDRY
80278369
96292187
170573475
217605101
360196064
136840102
89743795
120149585
88918122
210157910
13986855
12529900
96536531
91889023
80524209
50000000
20000000
20000000
20000000
15022309
52000000
44055600
35006100
23155200
58707600
84793700
333041230
398559368
459197583
500761132
698302874
CREDITORS-EXP
BANKOVERDRAFT
RENTAL ADVANCE
CAR LOAN
100900450
HOUSINGLOAN
TOTAL CURRENT
LIABILITIES

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FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

1. Statement changes in working capital of CCD.

To study the different sources and applications of the funds of CCD.

VCR Institute of Management Studies Page 1

FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

VCR Institute of Management Studies Page 3

FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

VCR Institute of Management Studies Page 4

FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

Factors such as increasing pace of industrialization, technological innovations land

Financial management as an application of general managerial principles to the area of

Financial management is an area of financial decision making harmonizing individual

FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

FUNDAMENTAL PRINCIPLE OF FINANCE:

outlay represents the net present value of NPV of the proposal.

NPV = Present value of future cash benefits Initial cash outlay

FUNDS FLOWS STATEMENT

FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

PREPARATION OF FUNDS FLOW STATEMENT:

OBJECTIVE OF FUND FLOW STATEMENT:

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FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

The main purposes of Fund Flow Statement are:

in the income statement of financial statement.

for the period?

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FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

(2) Evaluation of the Firm's Financing:

(3) An Instrument for Allocation of Resources:

(4) A Tool of Communication to Outside World:

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FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

ADVANTAGES OF THE FUNDS FLOW STATEMENT

changes in the financial structure of the corporation.

corporation is illiquid position.

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FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

of making profits a corporation is illiquid position.

repayment the source of repayment etc.

balance sheets and income statements and is related to a time span.

LIMITATIONS OF FUNDS FLOW ANALYSIS:

with much accuracy.

DIFFERENT NAME OF FUNDS FLOW STATEMENT:

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FUNDS FLOW ANALYSIS

CHENNAI CUTTING DIES

MAIN PURPOSE OF FUNDS FLOW STATEMENT: