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A

PROJECT REPORT
ON

BALANCE SHEET COMPARISION

At

“The Upper Doab Sugar Mills Limited”

For the partial fulfillment of the requirement for the degree of

MASTER OF BUSINESS ADMINISTRATION


(SESSION:-2018-2019)

`
SUBMITTED TO SUBMITTED BY

MOHIT SINGHAL DEEPAK KUMAR


HOD ROLL NO-1733670003
REMTECH , SHAMLI MBA-3RD SEM
ACKNOWLEDGEMENT

In writing this report entitled ‘‘UPPER DOAB SUGAR MILL’’, I have greatly benefited by

my visits to the company where I got the opportunity of studying the practical working of the

Financial department.

I would like to thanks our Director Dr. Gaurav Sinha & members of Roorkee Engineering and

Management Technology Institute for giving me chance to work on this project. I am also

thankful to our Head of Department and internal guide, Mr. Mohit Singhal, for their effective

guidance regarding the project and support.

My sincere and deepest thanks to MR. RAJAT LAL (Managing Director, UPPER DOAB

SUGAR MILL)

Last but not the least I express my gratitude to my family and friends for providing me with

all the support during the study.

DEEPAK KUMAR

ROLL NO. 1733670003


DECLARATION

I hereby declare that the project titled “BALANCE SHEET COMPARISON” is an original

piece of research work carried out by me under the guidance and supervision of Mr. Mohit

Singhal. The information has been collected from genuine and authentic sources. The work

has been submitted in partial fulfillment of MASTER OF BUSINESS ADMINISTRATION

of Dr. A.P.J Abdul Kalam Technical University Formally AKTU, LUCKNOW.

Place: DEEPAK KUMAR

Date: Roll No: 1733670003


PREFACE

Beginning of a Finance project was entirely creative. Thus, does not come suddenly but it

comes by result of discussion ,consultation and contemplation problem unsolved here can

never be a satisfactory elimination later. But when I completed my project I felt lot more

confident. Now I can do a new job more confidently and in a better way.

Practical Training is essential part of a theory study. It familiarizes with the practical aspect in

the industry and quality of the product in the industry.

Repairing this fact, I have thus industrial training report on “BALANCE SHEETS

COMPARISON” in UPPER DOAB SUGAR MILL SHAMLI (U.P.).


EXECUTIVE SUMMARY

Sir Shadi Lal Enterprises Limited started its business in the year 1933 with a sugar factory

name UPPER DOAB SUGAR MILL with a cane crushing capacity of 600 TCD per day at

Shamli district Muzaffarnagar (U.P). Shamli is about 40 km from district Muzaffarnagar

,about 70 km from Saharanpur and 100 km from Delhi .the company has been constantly

modernizing its plant and machinery in stages by adopting the latest technologies. Main

Product of the company is white refined Sugar which is being imported to other countries and

also locally sold .There are different types of employees which are hired at need basis. Some

employees are permanent who work for whole year and some are temporary which work

seasonally. The management is quite successful in providing a congenital and cooperative

atmosphere to its employees . The organization provides all the basic facilities to the

employees. Theoretical knowledge is always incomplete without its practical implication like

gun without bullet. Seeing the necessity of the practical knowledge the MBA curriculum is

designed in such a manner to impart the opportunity to students for enough exposure to the

corporate world.
TABLE OF CONTENT

 Company Profile.
 Comparison of Balance sheets.
 Objective of Study.
 Scope and Need of Study.
 Importance of study.
 Research Methodology.
 Data Analysis.
 Limitations.
 Recommendation.
 Conclusion.
 Annexure.
 Bibliography.
INTRODUCTION
INTRODUCTION

Sir Shadi Lal Enterprises Limited was established in 1933 as a Corporate Body under the
name 'The Upper Doab Sugar Mills Limited' by the Rt. Hon'ble SIR SHADI LAL.
With the untiring efforts of all of them, the Company has become one of the efficient and

modern entities in Western Uttar Pradesh. All the working Directors of the Company are well

qualified and have an excellent understanding of the operation of the Company. At present

the Company has four manufacturing units comprising of two sugar units namely Upper Doab

Sugar Mills, Shamli (U.P.), Unn Sugar Complex, Unn (U.P.), and two distillery units Shamli

Distillery & Chemical Works, Shamliand Pilkhani Distillery & Chemical Works, Pilkhani,

District Saharanpur (U.P.)

Sir Shadi Lal Enterprises Limited started its business in the year 1933 with a Sugar Factory,

Upper Doab Sugar Mills with a cane crushing capacity of 600 TCD per day at Shamli (UP),

about 70 Kms. from Distt. Saharanpur (UP) and about 100 kms. from Delhi. The Company

has been constantly modernizing its plant & machinery in stages by adopting the latest

technology. Per constant improvements and expansion, the crushing capacity of the Sugar

Mill Plant at Shamli has increased to the present level of 6250 TCD per day. The capacity

utilization of the Plant for the last number of years has been more than 100%. Being a

seasonal industry, the Sugar Factory works for about 180–200 days in a year.

In September 2007, Sir Shadi Lal Enterprises Limited further expanded its cane crushing

capacity by acquiring assets of Unn Sugar Complex at Unn, (U.P.) from Monnet sugar Ltd.

with a cane crushing capacity of 4000 TCD per day.


Shamli Distillery unit was installed at Shamli,(U.P.) in the year 1945 with an installed

capacity of 6.60 lakhs gallons per annum. Subsequently, the capacity was increased in stages

as detailed below to reach its present level of 16.20 lakhs gallons per annum. Since this

distillery is located adjacent to the Sugar factory, it has an inherent advantage of procuring

molasses from the Sugar unit through pipelines.

In the year 2001, to increase the production capacity of Country Liquor and Indian Made

Foreign Liquor, the Shamli Distillery Unit renovated their existing Bottling Hall, which can

now produce more than 2 Million cases per annum.

At present, the unit is producing Indian Made Foreign Liquor, Country Liquor, malt,

Rectified Spirit, Denatured Spirit, Anhydrous Alcohol & Extra Neutral Alcohol.

The major expansion projects taken up by the Company at various stages for the Sugar Mill at

Shamli are summarized below: -

Year Expansion to (TCD)

1936-37 1200

1956-57 3000

1962-63 3810

1997-98 5000

2005-06 6250
Per constant improvement and expansion, the crushing capacity of the Sugar Mill Plant at

Shamli has increased to the present level of 6250 TCD per day. The capacity utilization of the

Plant for the last number of years has been more than 100%. Being a seasonal

industry, the Sugar Factory works for about 180-200 days in a year.

The segment–wise detailed management discussion and analysis is stated below:

Cane Price

U.P. Government has declared the State Advisory Price (SAP) for the season 2014-15 at Rs.

280/– per quintal for General variety, Rs. 290/– per quintal for early variety and Rs. 275/– per

quintal substandard variety. The FRP for the season 2014-15 declared by the Central

Government was Rs. 210/– per quintal linked to basic recovery of 9.50% subject to premium

of Rs.2.21per quintal of every 0.1% increase in recovery. The Sugar Mills of U.P. State

opposed against the SAP in the season 2014-15 declared by the State Government and sent

notice for suspension of operation for the season 2014-15. Many representations were made

by the U.P. Sugar Mills Association and there arrived a settlement between the private sugar

Mills and U.P. Government, by which the State Government allowed a relief of Rs.11.03 per

quintal of cane in the shape of Purchase Tax Rs. 2/– per quintal of cane, on Entry Tax Rs.2.73

per quintal on Society Commission Rs. 6.30 per quintal of cane. The rebate of purchase of Rs.

2/– per quintal was also given in the season 2014-15by the U.P. Government. The Entry Tax

is collected from Customer and deposited in Govt. Account. Therefore, the actual relief was

only Rs. 6.30 per quintal on Society Commission, which also will be reimbursed after two

months of submission of claim. The U.P. Govt. has also agreed that the Sugar Mills will make

payment of Rs. 280/– per quintal in two instalments. 1st instalment of Rs. 260/– will be paid

immediately at the time of purchase of cane and 2nd instalment of Rs. 20/– per quintal,
after closure of the season 2014-15. It has also been informed by the U.P. Govt. that to review

the further relief of Rs. 8.97 per quintal of cane (Rs. 20 – Rs. 11.03), the State Govt. formed a

Committee to determine the paying capacity of sugar mills. If the prices of sugar falls below

the level determined by the Committee, then the entire amount of Rs. 8.97 per quintal will be

borne by the Govt. and if the prices of sugar rises above the level, determined by the

Committee, the industry will bear the entire burden of balance amount. As agreed by U.P.

govt. the Committee will give its report within 3 months. No report or recommendation for

balance amount of Rs. 8.97 has been given by the Committee so far.

Sugar Production & Consumption

Indian Sugar Mills Association (ISMA), the apex representative body of sugar industry has

revised the sugar production estimate to238 Lac tones from 250 Lac tones for the sugar

season 2014-15 (from October, 2015 to September, 2016). In the last sugar season2014-15

the sugar production was 254 Lac tonnes. Due consideration has been given to weather

conditions prevailing in the last several months including heavy rain fall in certain parts of

U.P., availability of water in Maharashtra and north Karnataka and less availability of water

in Tamil Nadu. Despite downfall a downward revision in the output of sugar, supply will

continue to be ample in the country as the country has started with an opening stock of 107

Lac tones in October, 2015. In the first half of the reaching sugar year the sugar mills have

dispatched 125 Lac tones sugar for sale in the domestic market, due to better lifting during the

last few months following the improvement in the market sentiments.


The Cabinet Committee of Economic Affairs has, in February, 2016; approved subsidy of

Rs.3300/– per MT on export of raw sugar till the end of March, 2016 to bail out the cash

starved sugar industry. The idea was to increase export, which would clear the massive sugar

stock lying with the sugar mills and would ease the pressure on the domestic price. The

subsidy would be given on export of 40 Lac tonnes of raw sugar over a period of two years

and quantum of subsidy would be re–calculated periodically based on the dollar/rupee rate. In

the hope of export of sugar the prices of sugar have improved. While the mills were expecting

good rates of subsidy due to rupee/dollar fluctuations for the month of April & May, 2016 the

Govt. cut it down to Rs.2277/– per tonne in the month of May, 2016 after elections. This has

adversely affected the export of sugar. So far 4 Lac tones sugar has been exported which is

just 10% of the target and it is feared that with the consumption of approx.230–235 Lactones

the sugar stock will be much on the higher side at the end of September, 2016. Industry is

also pursuing with the Government to raise the import duty of sugar from 15% to 40% to

discourage the import of sugar.


Company Profile
Company Profile
BOARD OF DIRECTORS: Shri R.C. Sharma-Chairman
Shri Rajat Lal-Managing Director
Shri Vivek Viswanathan-Joint Managing
Director
Shri Rahul Lal-Executive Director
Shri Hemantpat Singhania
Shri Radhika Viswanathan Hoon
Shri Ajit Hoon
Smt. Onke Aggarwal

COMPANY SECRETARY: Shri Ajay Kumar Jain

BANKERS: State Bank of India


Punjab National Bank

AUDITORS: M/S M.Sharan Gupta & Co. (Appointed w.e.f


14.03.18)
D-132, Barla Apartments, 43-I.P Extension,
Patparganj, Delhi- 110092

REGISTERED OFFICE: 4-A, Hansalaya, 15, Barakhamba Road


New Delhi 110001

MANUFACTURING UNITS: Upper Doab Sugar Mills,


Shamli-247 776 (U.P.)

Shamli Distillery & Chemical Works,


Shamli – 247776 (U.P)
Managerial Staff
"Senior qualified and experienced professionals in their respective areas assist Board of

Directors" Details of Senior Management Personnel are as detailed below

Sl
Name Designation Age Qualifications Experience
No.

Chief Operating M.Tech AMIE(Mech.


1 Shri R B Khokhar 47 19 Years
Officer Engineer)

Company M.com LL.B F.C.S NET


2 Shri Ajay Kumar Jain 42 17 Years
Secretary PE-II

General Manager
3 Shri Kuldeep Pilania 40 M.Sc P.hD 20 Years
(Cane)

Shri Pravin Kumar General Manager-


4 50 B.Sc DIFAT 27 Years
Srivastava Shamli Distillery

5 Shri Pankaj Agarwal General Manager 46 B.Sc. ANSI 25 Years


(Production)
UDSM
Shri S K Singh
6 G.M.(HR) 56 B.A LLB 32 Years
Raghuwanshy
VISION

To establish an integrated sugar complex that would include the manufacture of sugar,

industrial & potable alcohol, ethanol, co-generation facilities and other related products.

MISSION
To achieve sustainable growth through:

 By constant up-gradation and modernization of plant and machinery, and adapting

modern business tools and techniques to our business operations.

 By creating an environment that fosters and encourages professional management. By

traversing the path from selling sugar as a commodity, to that of a branded product.

 By increasing the capacity of our distillery.

 By maximizing shareholder’s wealth.


PROCURMENT OF SUGARCANE
Sugarcane is broadly classified into three varieties - early, general and unapproved. Cane is

sowed during February and October every year. The first seed growth is known as the plant

and subsequent growth after harvesting from the stem is known as Ratoon. The early variety

has more sugar content than the general variety.

Every farmer within the command area of the Mill is provided with a calendar, which tells

him when he can expect a Mill Supply Ticket (Purchy), against which he will deliver the

sugarcane.

He then harvests the cane and transports it either in a bullock cart or tractor trolley to the mill.

Cane is also bought at the mill's own centers within the command area. This cane is then

transported in trucks or through rail to the mill.


MANUFACTURING PROCESS
The manufacturing of sugar begins when harvested cane is received at the mill gate, after

which cane is weighed on the platform type weighbridges. This has the weight recording

arrangement linked to a computer that records the gross and net weights as well as the price

payable to the farmers. Cart cane gets unloaded directly into the cane carrier and tractor

trolleys whereas truck cane is unloaded with the help of overhead traveling cranes. Cane is

weighed using an electronic weighbridge and unloaded into cane carriers. It is then prepared

for milling by knives and shredders. Sugarcane juice is then extracted by pressing the

prepared cane through mills.

Each mill consists of three rollers:

1. Extracted juice mixed with water is weighed and sent to the boiling house for further

processing. Residual bagasse is sent to boilers for use as fuel for steam generation.

2. This juice is heated and then treated with milk of lime and Sulphur dioxide. The

treated juice is then further heated and sent to clarifiers for continuous settling. The

settled mud is filtered by vacuum filters and filtered juice is returned to be further

processed while the Oliver cake is sent out.


3. The clear juice is evaporated to a syrup stage, bleached by Sulphur dioxide and then

sent to vacuum pans for further concentration and sugar grain formation. Crystals are

developed to a desired size and the crystallized mass is then dropped in the

crystallizers to exhaust the mother liquor of its sugar as much as possible. This is then

centrifuged for separating the crystals from molasses. The molasses is re-boiled for

further crystallization.

Thus, the original syrup is desugarised progressively (normally three times) till finally, a
viscous liquid is obtained from which sugar can no longer be recovered economically. This
liquid, which is called final molasses, is sent to the distillery for making alcohol. The sugar
thus is separated from molasses in the centrifuge is dried, bagged (50 Kg and 100 Kg),
weighed and sent to storage houses. Sugar is made in different sizes and accordingly
classified into various grades i.e. large, medium and small.
BY - PRODUCTS OF THE SUGAR MAKING PROCESS

1. Molasses

Molasses is the only by-product obtained in the preparation of sugar through repeated

crystallization. The yield of molasses per ton of sugarcane varies in the range of 4.5% to 5%.

Molasses is mainly used for the manufacture of alcohol, yeast and castle seeds.

Alcohol in turn is used to produce ethanol, rectified spirit, potable liquor and downstream

value added chemicals such as acetone, acetic acid, butanol, acetic anhydride, MEG etc.The

state government controls the export of molasses through export licenses issued every quarter.

Molasses and alcohol-based industries were decontrolled in 1993 and are now being

controlled by respective state government policies. Nearly the industrial alcohol

manufacturers consume 90% of molasses produced and the remaining 10% is consumed by

the potable alcohol sector.

2. Bagasse

Bagasse is a fibrous residue of cane stalk that is obtained after crushing and extraction of

juice. It consists of water, fiber and relatively small quantities of soluble solids. The

composition of bagasse varies based on the variety of sugarcane, maturity of cane, method of

harvesting and the efficiency of the sugar mill. Bagasse is usually used to generate power. It

is also used as a raw material for production of paper and as feedstock for cattle. By making

use of bagasse sugar mills have been successful in reducing their dependence on the State

Electricity Boards.

Press-mud

Press mud, also known as Oliver cake or press cake, is the residual output after the filtration

of the juice. It is mixed with spent wash from the distillery and cultivated to produce high
TREND IN DOMESTIC SUGAR PRICE
The sugar prices which were around Rs.3300/– per quintal. In February/March, 2016 came

down to Rs.2800/– per qtl. Up to mid-February, 2017. In the hope of export of sugar the

prices of sugar have improved in the month of March and April, 2017 and reached

uptoRs.3200/– to Rs.3250/– per qtl. Due to fall in the prices of sugar in the international

market the prices of sugar have come down toRs.3000/– per qtl. The present international

sugar price is $475 – 480 per tonne. The average sugar realization in the financial year2016-

17 in unit Upper Doab Sugar Mills is Rs.2994.70 per qtl and in Unn Sugar Complex it is

Rs.2968.70 per quintal.


COMPANY ETHICS & SOCIAL RESPONSBILITIES
The Management of this Company believes in ethical management practices and implements

them in true spirits. They are extremely sensitive towards their social commitment obligations

from the very beginning. Few years back, Company established a full-fledged Hospital with

adequate indoor beds and other equipment’s, like X-Ray Machine etc., at Shamli, known as

Sir Shadi Lal Memorial Hospital and the same was handed over to the State Government. A

big Community Hall costing more than Rs. 40 lakhs were built in the heart of the city of

Shamli and the Company contributed more than 50 per cent of the cost of construction.

The repair work of the roads of the command area is taken on a regular basis. Regular

donations are given to the various Voluntary Organizations and other welfare organizations,

for organizing Eye Camps, Family Planning Camps and other activities at Shamli. The

Company also undertakes on a regular basis recreational programs at Shamli and the

Exhibition at Muzaffarnagar.
OUTLOOK AND CHALLENGES
Sugar Mills in U.P. have incurred heavy losses during the last few years. Even though the

Govt. has announced a few measures to assist the industry, the mills are still not able to

recover their cost. On one side cane price arrears of farmers have reached at an all-time high

while on the other side the sugar mills are defaulted in the payments of their loans leading

several mills becoming Non-Performing Assets (NPA) or are filing Corporate Debt Re-

structuring (CDR). The Centre had come up with a scheme for the industry whereby banks

would extend soft loan of Rs.6600 Crores to help in clearing cane price arrears. Out of this

only Rs.3000 Crores has been disbursed so far. The banks are reluctant to lend anymore

because they fear that it would add to their list of Non-Performing Assets.

The balance cane price outstanding in UP are Rs.8, 754/– crores as on 29.05.2017. The

Hon’ble High Court at Allahabad have directed the State Government vide its Judgement

dated 30th May 2017 of PIL filed by Shri. V.M. Singh that the entire cane price for the season

2016-17 be paid by 30th June 2016. Thereafter, the Cane Commissioner, UP has put pressure

on the sugar mills to pay the entire cane price in the month of June, 2017 by issuing Recovery

Certificate and lodging FIR against the sugar mills. Now on 1st July 2017 the Hon’ble High

Court Allahabad have directed the State Government that the necessary steps shall be taken to

ensure the payment of balance amount of sugar cane dues to the farmers by 24th July 2017.

The Hon’ble High Court has further directed the implement of the Union Government as a

party respondent to these proceedings and notice be issued to the Union Government. On 24th

July, 2017, the court could not sit and the date of hearing was further extend
Due to unreasonable cane price in U.P. which has aggravated by low sugar recovery and lack

of adequate opportunities to export sugar, the mills in U.P. continued to sink further in deeper

financial crisis.

An independent report India Rating and Research (IND–RA) published titled as 2017

Outlook Sugar Sector Highlights that “North south divergence (is) more distinct” It also

mentioned that “South based millers should stay afloat (and) north based millers toslide.” The

outlook revision reflects the improvement in the credit profiles of millers based in south India

from financial year 2017 levels. However, UTTAR PRADESH (U.P.) based mills will likely

to continue to struggle with high leverages.

The report suggests that better opportunities and prospects that would be available in the next

year would benefit only south based sugar mills, while the north based mills including those

in U.P. would remain in red. The main reason for that is extremely high cost of producing

sugar in U.P. which at the current cane price and sugar realization is Rs.3600/– per qtl. as

compared to sugar producing cost of around Rs.3000/ to 3200/– per qtl in Maharashtra and

South India.

The BJP led NDA Government has constituted a committee of Ministers to review the

problems of sugar industry to ensure the interest of consumers, cane farmers and sugar mills.

The committee has recommended further extend soft loan of Rs.4400crores to the sugar

industry to help in clearing the cane price arrears, increase in the import duty on import of

sugar from 15% to 40% to discourage the import of sugar.


PARTICULARS SUGAR SEASON (2017-18)

– Gross Working days 214

UNIT- SHAMLI UPPER DOAB SUGAR MILL (2017-18)

– Gross Working days 214

– Cane Crushed (lakh/Qtls.) 115.63

– Average Cane Crush per Crop day (Qtls.) 54033

– Manufacturing losses (%) 1.99

– Steam Consumption cane (%) 51.40

– Average Sugar recovery (%) 10.87

– Total sugar produced (lakh/Qtls.) 12.56

UNIT – SHAMLI DISTILLERY & CHEMICAL

WORKS, SHAMLI
In Shamli Distillery, the production is 7066191 BL during the year 2015-16 as against

7333632 BL during the last financial year 2015-16. During the year 2015-16, Fermentation %

was 89.04 as against 89.05 during 2015-16. Distillation % was 98.05as against 98.05 during

last year. Overall % was 86.95 during 2015-16 as against 89.96 during the year 2014– 15.

During the year 2014-15, the recovery in AL was 21.80 as against 22.02 during last year.

Molasses rate was Rs. 388.03 per quintal during the year 2015-16 as against Rs.323.50 per

quintal during the year 2015-16. Shamli Distillery earned profit of Rs. 451.22 Lacs during the

year 2015-16 as against Rs. 350.42 Lacs during last year in 2015-16.
ALCOHOL & ETHANOL BLENDING

The Ethanol Blending Program is primarily based on indigenously produced ethanol from

sugarcane molasses, which beside segmenting fuel availability in the country would also

provide better returns for sugar cane farmers. The Indian Sugar industry has the capacity to

produce 250 crore Liters of alcohol annually and its major buyers are chemical industry with

demand of 60 crores Liters, Potable and Alcohol Industry which sources 110 crore Liters and

Oil companies need around 100crore Liters annually. The Government’s ambitious plan to

blend petrol with 5% Ethanol has fallen far short of target, creating problems for sugar mills,

which supply the alcohol, and the chemical industry, which is complaining that there is a big

shortage in the market. Against the requirement of 105 crore liters of ethanol for mandatory

5% blending with petrol, oil companies have contracted just 62 crore liters.

Their oil import bill if they had blended the 62-croreliter supplied by sugar mills in the past

year. While oil companies cite ‘procedural delays’ in lifting the Ethanol offered by the

supplier sugar mills, the latter is unable to regularize its ethanol production and supply due to

non-lifting by OMC. While the supply from the first tender was purchased in the price band

of Rs.39–42 per liter, oil firms decided in January, 2016 that they would procure ethanol from

only those bidders who match their benchmark price of Rs.44/– per liter. On this basis, they

also rejected 36 crore liters of ethanol supply from sugar mills. In the meanwhile, the

chemical industry filed three cases in the Competition Commission of India (CCI). Two were

quashed while one is with the Supreme Court. In its appeal to the apex court, India Glycols

has alleged cartelization by sugar mills and oil companies and submitted that with limited
availability of molasses –based ethanol in the country, any diversion of ethanol shall

adversely affect the very existence of the chemical industry in India. The ethanol blending

program has faced hassles from all corners, be it price issue with mills, procedural delays due

to inter–state policy mismatch and CCI case filed by the chemical industry. As there is

surplus sugar production, the Government should take steps for increasing the mandatory

ethanol blending from5% to 10%. This would divert surplus sugar to the ethanol production

and will reduce inventory level of sugar.


Human Resources initiatives and Industrial Relations
The Company has, as always, stood by its commitment of harnessing and developing its

people resources in the best possible manner for achievement of its business goals and

objectives. All through the year the level of people engagement has been of the highest order,

which has impacted the process of business growth and up–gradation of various systems in a

significant way.

Training and Development of employees

The process of training and development has continued with a view to upgrading skills and

competencies of people. Employees across all levels including Senior, and Middle

Management have been through various developmental programs customized to meet the

individual and organizational needs. The organization has continuously worked towards

providing an enabling work environment, which encourages people to acquire newer skills

and knowledge to make them more effective, productive and tuned to the environmental

changes.
GENERAL SHAREHOLDER

INFORMATION

a) Annual General Meeting: 24th September, 2018 at 11.00 A.M

Next Annual General Meeting: P.H.D.

House, Opp. Asian Game Village,

New Delhi – 110 016.

b) Financial Calendar (2018-19)

Financial reporting for the:

Quarter ending 30th June, 2018 Upto 14th August 2018

Financial reporting for the:

Quarter Ending 30th Sept., 2018 Upto 14th Nov. 2018

Financial reporting for the:

Quarter ending 31st Dec., 2018 Upto 14th February 2018

Financial reporting for the:

Quarter ending 31st March, 2019 30th May, 2019

c) Date of Books closure: 12th September, 2018 to 24nd September,

2018 (Both days inclusive)

d) Dividend payment date: No dividend is declsred by the company due to heavy loss
e) Listing on stock exchange : Bombsy Stock Exchange Ltd.

25th Floor, P.J Tower , dalal street

Mumbai-400001

f) Stock Code: 532879 of Bombay Stock Exchange Ltd

g) Corporate Identity Number: Our Corporate Identity No. is

L51909DL1933 PLC009509, allotted

by the Ministry of Company

Affairs, Government of India our

Company’s Registration No. is 9509.

h) Market Price Data: The Market Price Data and Volume

from 1st April, 2017 to 31st March,

2018 on the Bombay Stock Exchange

Limited, Mumbai is given below:


MONTHS HIGH (RS.) LOW (RS.) NO. OF SHARES TRADED

APRIL,2017 143.00 95.50 286325

MAY,2017 142.90 106.10 139944

JUNE,2017 133.10 95.50 135024

JULY,2017 124.00 99.00 92535

AUG,2017 133.00 100.55 145302

SEP,2017 172.00 108.00 409522

OCT,2017 159.00 131.00 307435

NOV,2017 142.70 117.00 68277

DEC,2017 133.50 67.10 290372

JAN,2018 72.90 58.10 178774

FEB,2018 65.00 50.50 45712

MARCH,2018 55.95 36.60 111210

(i)BSE Sensex, Crisil Index etc :

Performance of share price of the Company in comparison to BSE Sensex during the period

01-04-2017 to 31-03-2018 is given below:


(j) Registrar & Transfer Agent : M/s Alankit Assignment Ltd., Alankit House, 2E/21,

Jhandewalan Extension, New Delhi- 110 055 have been acting as the Registrar and Share

Transfer Agent for shares of the company.

(k) Share Transfer System : The transfer of shares in physical form is processed by the

Secretarial Department of the Company on the basis of data forwarded by the Share Transfer

Agent, M/s Alankit Assignment Ltd. within the prescribed time. The Share Transfer

Committee/Board of Directors approves transfer of shares in physical form, transmission of

shares, transposition of name, consolidation/ split of share Certificates, remat of shares and

issue of duplicate share certificates in lieu of the lost/misplaced share certificates. The Share

Transfer Committee of the Board of Directors meet as and when required to consider and

approve the share transfer/transmission applications. In case of shares in Electronic form the

transfers are processed through Share Transfer Agent by NSDL/CDSL through respective

Depository participants and the details on a regular basis are placed before the Share Transfer

Committee of the Board of Directors/ Board of Directors.


COMPARISON

OF

BALANCE SHEET
INTRODUCTION TO BALANCE SHEET

The accounting balance sheet is one of the major financial statements used by accountants

and business owners. (The other major financial statements are the income statement,

statement of cash flows, and statement of stockholders' equity) The balance sheet is also

referred to as the statement of financial position.

The balance sheet presents a company's financial position at the end of a specified date. Some

describe the balance sheet as a "snapshot" of the company's financial position at a point (a

moment or an instant) in time. For example, the amounts reported on a balance sheet dated

December 31, 2016 reflect that instant when all the transactions through December 31 have

been recorded.

Because the balance sheet informs the reader of a company's financial position as of one

moment in time, it allows someone—like a creditor—to see what a company owns as well as

what it owes to other parties as of the date indicated in the heading. This is valuable

information to the banker who wants to determine whether or not a company qualifies for

additional credit or loans. Others who would be interested in the balance sheet include current

investors, potential investors, company management, suppliers, some customers, competitors,

government agencies, and labor unions.

This Theoritical Framework has been categorized under four PARTS.


PART I

In this Part 1 we will explain the components of the balance sheet and in Part 2 we will

present a sample balance sheet. If you are interested in balance sheet analysis, that is included

in the Explanation of Financial Ratios.

We will begin our explanation of the accounting balance sheet with its major components,

elements, or major categories:

 Assets

 Liabilities

 Owner's (Stockholders') Equity

In AccountingCoach PRO you will find some special materials on the balance sheet. For

example, the video seminar Understanding Financial Statements provides a line-by-line

explanation of a balance sheet. PRO also includes a visual tutorial, business forms, and exam

questions that will help you learn and retain information on the balance sheet.
ASSETS

Assets are things that the company owns. They are the resources of the company that have

been acquired through transactions, and have future economic value that can be measured and

expressed in dollars. Assets also include costs paid in advance that have not yet expired, such

as prepaid advertising, prepaid insurance, prepaid legal fees, and prepaid rent. (For a

discussion of prepaid expenses go to Explanation of Adjusting Entries.)

Examples of asset accounts that are reported on a company's balance sheet include:

 Cash

 Petty Cash

 Temporary Investments

 Accounts Receivable

 Inventory

 Supplies

 Prepaid Insurance

 Land

 Land Improvements

 Buildings

 Equipment

 Goodwill
Contra assets are asset accounts with credit balances. (A credit balance in an asset account is

contrary—or contra—to an asset account's usual debit balance.) Examples of contra asset

accounts include:

 Allowance for Doubtful Accounts

 Accumulated Depreciation-Land Improvements

 Accumulated Depreciation-Buildings

 Accumulated Depreciation-Equipment

 Accumulated Depletion

 Etc.
Classifications Of Assets On The Balance Sheet

Accountants usually prepare classified balance sheets. "Classified" means that the balance

sheet accounts are presented in distinct groupings, categories, or classifications. The asset

classifications and their order of appearance on the balance sheet are:

 Current Assets

 Investments

 Property, Plant, and Equipment

 Intangible Assets

 Other Assets

An outline of a balance sheet using the balance sheet classifications is shown here:
Effect of Cost Principle and Monetary Unit Assumption

The amounts reported in the asset accounts and on the balance sheet reflect actual costs

recorded at the time of a transaction. For example, let's say a company acquires 40 acres of

land in the year 1950 at a cost of $20,000. Then, in 1990, it pays $400,000 for an adjacent 40-

acre parcel. The company's Land account will show a balance of $420,000 ($20,000 for the

first parcel plus $400,000 for the second parcel.). This account balance of $420,000 will

appear on today's balance sheet even though these parcels of land have appreciated to a

current market value of $3,000,000.

There are two guidelines that oblige the accountant to report $420,000 on the balance sheet

rather than the current market value of $3,000,000: (1) the cost principle directs the

accountant to report the company's assets at their original historical cost, and (2) the monetary

unit assumption directs the accountant to presume the U.S. dollar is stable over time—it is not

affected by inflation or deflation. In effect, the accountant is assuming that a 1950 dollar, a

1990 dollar, and a 2016 dollar all have the same purchasing power.

The cost principle and monetary unit assumption may also mean that some very valuable

resources will not be reported on the balance sheet. A company's team of brilliant scientists

will not be listed as an asset on the company's balance sheet, because (a) the company did not

purchase the team in a transaction (cost principle) and (b) it's impossible for accountants to

know how to put a dollar value on the team (monetary unit assumption).
Coca-Cola's logo, Nike's logo, and the trade names for most consumer products companies

are likely to be their most valuable assets. If those names and logos were developed

internally, it is reasonable that they will not appear on the company balance sheet. If,

however, a company should purchase a product name and logo from another company, that

cost will appear as an asset on the balance sheet of the acquiring company.

Remember, accounting principles and guidelines place some limitations on what is reported

as an asset on the company's balance sheet.

Effect of Conservatism

While the cost principle and monetary unit assumption generally prevent assets from being

reported on the balance sheet at an amount greater than cost, conservatism will result in some

assets being reported at less than cost. For example, assume the cost of a company's inventory

was $30,000, but now the current cost of the same items in inventory has dropped to $27,000.

The conservatism guideline instructs the company to report Inventory on its balance sheet at

$27,000. The $3,000 difference is reported immediately as a loss on the company's income

statement.
Effect of Matching Principle

The matching principle will also cause certain assets to be reported on the accounting balance

sheet at less than cost. For example, if a company has Accounts Receivable of $50,000 but

anticipates that it will collect only $48,500 due to some customers' financial problems, the

company will report a credit balance of $1,500 in the contra asset account Allowance for

Doubtful Accounts. The combination of the asset Accounts Receivable with a debit balance

of $50,000 and the contra asset Allowance for Doubtful Accounts with a credit balance will

mean that the balance sheet will report the net amount of $48,500. The income statement will

report the $1,500 adjustment as Bad Debts Expense.

The matching principle also requires that the cost of buildings and equipment be depreciated

over their useful lives. This means that over time the cost of these assets will be moved from

the balance sheet to Depreciation Expense on the income statement. As time goes on, the

amounts reported on the balance sheet for these long-term assets will be reduced.
PART II

LIABILITIES

Liabilities are obligations of the company; they are amounts owed to creditors for a past

transaction and they usually have the word "payable" in their account title. Along with

owner's equity, liabilities can be thought of as a source of the company's assets. They can also

be thought of as a claim against a company's assets. For example, a company's balance sheet

reports assets of $100,000 and Accounts Payable of $40,000 and owner's equity of $60,000.

The source of the company's assets are creditors/suppliers for $40,000 and the owners for

$60,000. The creditors/suppliers have a claim against the company's assets and the owner can

claim what remains after the Accounts Payable have been paid.

Liabilities also include amounts received in advance for future services. Since the amount

received (recorded as the asset Cash) has not yet been earned, the company defers the

reporting of revenues and instead reports a liability such as Unearned Revenues or Customer

Deposits. (For a further discussion on deferred revenues/prepayments see the Explanation of

Adjusting Entries.)
Examples of liability accounts reported on a company's balance sheet include:

 Notes Payable

 Accounts Payable

 Salaries Payable

 Wages Payable

 Interest Payable

 Other Accrued Expenses Payable

 Income Taxes Payable

 Customer Deposits

 Warranty Liability

 Lawsuits Payable

 Unearned Revenues

 Bonds Payable

Liability accounts will normally have credit balances.

Contra liabilities are liability accounts with debit balances. (A debit balance in a liability

account is contrary—or contra—to a liability account's usual credit balance.) Examples of

contra liability accounts include:

 Discount on Notes Payable

 Discount on Bonds Payable

 Debt Issue Costs

 Bond Issue Costs


Classifications Of Liabilities On The Balance Sheet

Liability and contra liability accounts are usually classified (put into distinct groupings,

categories, or classifications) on the balance sheet. The liability classifications and their order

of appearance on the balance sheet are:

 Current Liabilities

 Long Term Liabilities


Commitments

A company's commitments (such as signing a contract to obtain future services or to purchase

goods) may be legally binding, but they are not considered a liability on the balance sheet

until some services or goods have been received. Commitments (if significant in amount)

should be disclosed in the notes to the balance sheet.

Form vs. Substance

The leasing of a certain asset may—on the surface—appear to be a rental of the asset, but in

substance it may involve a binding agreement to purchase the asset and to finance it through

monthly payments. Accountants must look past the form and focus on the substance of the

transaction. If, in substance, a lease is an agreement to purchase an asset and to create a note

payable, the accounting rules require that the asset and the liability be reported in the

accounts and on the balance sheet.

Contingent Liabilities

Three examples of contingent liabilities include warranty of a company's products, the

guarantee of another party's loan, and lawsuits filed against a company. Contingent liabilities

are potential liabilities. Because they are dependent upon some future event occurring or not

occurring, they may or may not become actual liabilities.

To illustrate this, let's assume that a company is sued for $100,000 by a former employee who

claims he was wrongfully terminated. Does the company have a liability of $100,000? It

depends. If the company was justified in the termination of the employee and has

documentation and witnesses to support its action, this might be considered a frivolous

lawsuit and there may be no liability.


On the other hand, if the company was not justified in the termination and it is clear that the

company acted improperly, the company will likely have an income statement loss and a

balance sheet liability.

The accounting rules for these contingencies are as follows: If the contingent loss is probable

and the amount of the loss can be estimated, the company needs to record a liability on its

balance sheet and a loss on its income statement. If the contingent loss is remote, no liability

or loss is recorded and there is no need to include this in the notes to the financial statements.

If the contingent loss lies somewhere in between, it should be disclosed in the notes to the

financial statements.

Current vs. Long-term Liabilities

If a company has a loan payable that requires it to make monthly payments for several years,

only the principal due in the next twelve months should be reported on the balance sheet as a

current liability. The remaining principal amount should be reported as a long-term liability.

The interest on the loan that pertains to the future is not recorded on the balance sheet; only

unpaid interest up to the date of the balance sheet is reported as a liability.

Notes to the Financial Statements

As the above discussion indicates, the notes to the financial statements can reveal important

information that should not be overlooked when reading a company's balance sheet.
PART III

Owner's (Stockholders') Equity

Owner's Equity—along with liabilities—can be thought of as a source of the company's

assets. Owner's equity is sometimes referred to as the book value of the company, because

owner's equity is equal to the reported asset amounts minus the reported liability amounts.

Owner's equity may also be referred to as the residual of assets minus liabilities. These

references make sense if you think of the basic accounting equation:

Assets = Liabilities + Owner's Equity

and just rearrange the terms:

Owner's Equity = Assets - Liabilities

"Owner's Equity" are the words used on the balance sheet when the company is a sole

proprietorship. If the company is a corporation, the words Stockholders' Equity are used

instead of Owner's Equity. An example of an owner's equity account is Mary Smith, Capital

(where Mary Smith is the owner of the sole proprietorship). Examples of stockholders' equity

accounts include:

 Common Stock

 Preferred Stock

 Paid-in Capital in Excess of Par Value

 Paid-in Capital from Treasury Stock

 Retained Earnings

 Accumulated Other Comprehensive Income


Both owner's equity and stockholders' equity accounts will normally have credit balances.

Contra owner's equity accounts are a category of owner equity accounts with debit balances.

(A debit balance in an owner's equity account is contrary—or contra—to an owner's equity

account's usual credit balance.) An example of a contra owner's equity account is Mary

Smith, Drawing (where Mary Smith is the owner of the sole proprietorship). An example of a

contra stockholders' equity account is Treasury Stock.

Classifications of Owner's Equity On The Balance Sheet

Owner's equity is generally represented on the balance sheet with two or three accounts (e.g.,

Mary Smith, Capital; Mary Smith, Drawing; and perhaps Current Year's Net Income). See the

sample balance sheet in Part 4.

The stockholders' equity section of a corporation's balance sheet is:

 Paid-in Capital

 Retained Earnings

 Accumulated Other Comprehensive Income

 Treasury Stock
The stockholders' equity section of a corporation's balance sheet is:
Owner's Equity vs. Company's Market Value

Since the asset amounts report the cost of the assets at the time of the transaction—or less—

they do not reflect current fair market values. (For example, computers which had a cost of

$100,000 two years ago may now have a book value of $60,000. However, the current value

of the computers might be just $35,000. An office building purchased by the company 15

years ago at a cost of $400,000 may now have a book value of $200,000. However, the

current value of the building might be $900,000.) Since the assets are not reported on the

balance sheet at their current fair market value, owner's equity appearing on the balance sheet

is not an indication of the fair market value of the company.

Owner's Equity and Temporary Accounts

Revenues, gains, expenses, and losses are income statement accounts. Revenues and gains

cause owner's equity to increase. Expenses and losses cause owner's equity to decrease. If a

company performs a service and increases its assets, owner's equity will increase when the

Service Revenues account is closed to owner's equity at the end of the accounting year.
PART IV

Sample Balance Sheet

Most accounting balance sheets classify a company's assets and liabilities into distinctive

groupings such as Current Assets; Property, Plant, and Equipment; Current Liabilities; etc.

These classifications make the balance sheet more useful. The following balance sheet

example is a classified balance sheet.


What is a Comparative Balance Sheet ?

A comparative balance sheet usually has two columns of amounts that appear to the right of

the account titles or other descriptions such as Cash and Cash Equivalents, Accounts

Receivable, Accounts Payable, etc.

The first column of amounts contains the amounts as of a recent moment or point in time, say

December 31, 2012. To the right will be a column containing corresponding amounts from an

earlier date, such as December 31, 2011. The older amounts appear further from the account

titles or descriptions as the older amounts are less important. Providing the amounts from an

earlier date gives the reader of the balance sheet a point of reference—something to which the

recent amounts can be compared.


Notes To Financial Statements

The notes (or footnotes) to the balance sheet and to the other financial statements are

considered to be part of the financial statements. The notes inform the readers about such

things as significant accounting policies, commitments made by the company, and potential

liabilities and potential losses. The notes contain information that is critical to properly

understanding and analyzing a company's financial statements.

It is common for the notes to the financial statements to be 10-20 pages in length. Go to the

website for a company whose stock is publicly traded and locate its annual report. Review the

notes near the end of the annual report.


Financial Ratios

A number of important financial ratios and statistics are generated by using amounts that are

taken from the balance sheet..


The concepts of various ratios which can be helpful to understand the financial position of a

company are as under:

[1] Current Ratio = Current assets / Current liabilities

The standard ratio is 2:1 which means current assets should be double than current liabilities.

Current assets includes all current type assets, cash, bank balances, sundry debtors,

receivables, stock etc., while current liabilities includes liabilities to be paid in short term,

sundry creditors, short term loans, taxes payable, dividend payable etc. This ratio shows the

working capital capability and capacity to pay the short term liabilities.

[2] Debtors Turnover Ratio =Total Book Debts /Sale Made on Credit * 365

This ratio gives average days required for receiving the book debts on account of credit sales.

If the ratio is lower than it shows good position. It gives clarity about how many days average

credit is given, efficiency of recovery of dues and control on credit sale.

[3] Debt Service Coverage Ratio (DSCR) = (Net Profit + Depreciation + Interest on long

term loans) / Total amount of interest & principal of long term loan payable or paid during

the year.

It is the most important ratio for term loan repayment capacity. The standard ratio is 1 but

DSCR of 2 is preferable because if DSCR is 2 it shows that even if cash falls at 50% then also

the company is capable to repay term loans liabilities.

Acid test ratio, Fixed Assets to Total assets, Fixed assets to Own Funds are also important

ratios to understand use of capital.


[4] Return on average total assets = Net profit / Average working fund *100

It gives the profitability & soundness of a company. In banking industry it stands nearly 1 to

2 %.

[5] Net Margin = Operating profit / Total Income * 100

[6] Net Interest Margin = (Interest Earned-Interest Paid) / Average working fund *100

[7] Staff Cost to Total Expenses = Total staff related expenses / Total Expenses *100

[8] Staff Cost to Total Income = Total staff related expenses / Total Income * 100

[9] Total Income to Working Capital = Total Income / Average Working fund * 100

[10] Total Income to Earning Assets = Total Income / Average earning assets * 100

[11] Risk provisions to Total income = Total of Risk provisions made during year / Total

Income * 100

In banking industry another relevant ratios are:

[12] Cost of deposits = Total interest paid on deposits / Average Deposits * 100

[13] Yield on advances = Total Interest Earned / Average Loans & Advances * 100

[14] Return on Investment = Total Interest or dividend Earned on Investments / Average

Investments * 100
[15] Return on Funds Deployed = (Total Interest or dividend Earned on Investments +

Interest Earned on Loans) / (Average Investments + Average Loans ) * 100

[16] Cost of Funds = (Interest paid on Deposits + Interest paid on Borrowings) / (Average

Deposits + Average Borrowings) *100

[17] Gross NPA % = Total NPA Loans / Total Loans *100

Here NPA means non performing assets. E.g. in term loans if interest and/or installments are

not paid within 90 days from it becomes overdue, it turns into non performing assets.

[18] Net NPA % = (Total NPA Loans – Provisions made for NPA Loans) / (Total Advances

– Provisions made for NPA Loans) * 100

In most of the banks Net NPA is zero because they have made sufficient provisions against

their NPA Loans (Bad Debts). But only zero NPA % is not sufficient as it doesn’t say that

the entity has no bad debts. So, Gross NPA % should be lower. As per recent guidelines from

RBI Net NPA (%) should be less than 5% to pay dividend and Gross NPA should be less than

10% to avoid Supervisory Action from RBI.

[19] PROVISIONING COVERAGE RATIO = Total Provisions made for NPA Assets /

Total NPA Assets * 100

It is simple to understand that this ratio should be atleast 100%. If this is less than 100% it

shows that the company has not fully provided their NPA Assets.
[20] Overdue % = Total Overdue Loans / Total Loans * 100

It reflects the repayments positions. If overdue is higher it shows that interests and/or

installments are not paid by customers on due date which creates negative effect on liquidity.

Further if overdue stands for long time it turns into NPA.

[21] CRAR: Capital Funds to Risk Assets Ratio.

It is calculated by the banks and published in Annual Reports. At present it should be atleast

9%. If it is less than 9% it shows adverse situation. As per latest guidelines by RBI if it is less

than 6% it attracts supervisory action from RBI.

[22] Credit Deposits Ratio = Total Loans given / Total Deposits * 100

Mostly called CD ratio should be less than 70% as per latest RBI guidelines. It means that

maximum 70% of deposits received from customers can be used to give Loans to the

customers

[23] CASA Deposits Ratio = (Total Current Deposits + Total Savings Deposits) / Total

Deposits *100

This represents the Lower cost deposits as no interest is paid on current deposits and at lower

rate on savings accounts. So, higher the ratio higher the profitability. But if CASA deposits

are more in total deposits it is risky also as there is no restriction on withdrawal of these

deposits and it can create adverse situations on liquidity position.


[24] Business Productivity Per Employee = (Total deposits + Total advances) / No of

Employee

In the same way Deposit per employee, Advances per employee are also calculated.

[25] Profit per employee : Net profit / No of Employees

In the same way Gross Profit per employee also calculated. This ratio is important to

measure the strength of Human Assets of the bank. It can be linked to give bonus or profit

share to employees.
OBJECTIVE

OF

THE STUDY
OBJECTIVE OF THE STUDY

The major objectives of the resent study are to know about financial strengths and weakness

of UPPER DOAB SUGAR MILL through Comparision of Balance Sheets.

The main objectives of resent study aimed as:

To evaluate the performance of the company by using appropriate methods of comparing

Balance Sheets to measure the efficiency of the company. To understand the liquidity,

profitability and efficiency positions of the company during the study period. To evaluate and

analyze various facts of the financial performance of the company.

 To study the present financial system at UPPER DOAB SUGAR MILL.

 To offer appropriate suggestions for the better performance of the company.

 To assess the strength or performance of UPPER DOAB SUGAR MILLS against


earlier periods, or against direct competitors.

 To Calculate Profit Or Loss.

 In order to analyze the financial statements.

 To analyse the deviation of fixed assests.

 To detrermine the liquidity.


SCOPE AND NEED OF
THE
STUDY
SCOPE OF THE STUDY

The scope of balance sheet comparison can be explained with the help of following points –

1. It is useful for inter firm comparison which implies that company compares its

performance with that of its industry peers.

2. It is useful in intra firm comparison which means that company will compare the

performance of various departments of the company to judge the best department within the

company.

3. It is useful in simplifying the accounting figures to make them understandable to a layman,

because it is easier to understand.

4. It is also useful in forecasting and planning for the future, also it helps in control by

comparing the actual performance with that of forecasted performance and looking for reason

for it.

5. It is also used for analysis of financial statements by various interested parties like bankers,

creditors, supplier etc.…. for taking future decision about the company
NEED OF STUDY

1. The study has great significance and provides benefits to various parties whom directly or

indirectly interact with the company.

2. It is beneficial to management of the company by providing crystal clear picture regarding

important aspects like liquidity, leverage, activity and profitability.

3. The study is also beneficial to employees and offers motivation by showing how actively

they are contributing for company’s growth.

4. The investors who are interested in investing in the company’s shares will also get

benefited by going through the study and can easily take a decision whether to invest or not to

invest in the company’s shares..


IMPORTANCE

OF THE

STUDY
IMPORTANCE OF THE STUDY

1. It simplifies the financial statements.

2. It helps in comparing companies of different size with each other.

3. It helps in trend analysis which involves comparing a single company over a period.

4. It highlights important information in simple form quickly. A user can judge a company by

just looking at few numbers instead of reading the whole financial statements.

5. It helps in preparation of budgets.

6. It helps in measurement of Efficiency.


RESEARCH

METHODOLOGY
RESEARCH METHODOLOGY
Research is a systematic method of finding solutions to problems. It is essentially an

investigation, a recording and an analysis of evidence for gaining knowledge.

A research methodology is a sample framework or a plan for study that is used as a guide for

conducting research. It is a blueprint that is followed in processing research work. Thus, in

good research methodology the line of action must be chosen carefully from various

alternatives

Per Clifford woody, “research comprises of defining and redefining problem,

formulating hypothesis or suggested solutions, collecting, organizing and evaluating

data, reaching conclusions, testing conclusions to determine whether they fit the

formulated hypothesis”

Objectives

• To study the performance management system.

• To determine the effectiveness of performance management system adopted.

• To determine the satisfaction of employees towards the various criteria employed for

measuring and evaluating the employee’s performance by the organization.


DATA COLLECTION METHOD
Per the required research for the project is both Primary and Secondary data collection

methods. We have used company website, annual report of UPPER DOAB SUGAR MILL,

SHAMLI some publications on the net and information related to broacher for secondary data

collection.

Primary Sources:

It refers to the statistical material which the investigator originates for himself for the enquiry

in hand. In other words, it is one which is collected by the investigator for the first time e.g. if

the cost of living of workers in a city are to be computed, then the information regarding the

facts collected by the investigators or enumerators would be termed as Primary data. In India,

there are various agencies which collect primary data e.g. National Sample Survey (NSS),

State Level Economic and Statistical Departments etc. When we use primary data, it is called

raw material. Per Wessel, "Data originally collected in the process of investigation are known

as primary data."

The use of primary sources is limited to interviews with some of the employees in the finance

department. The reason being, it is against the company’s policies and procedures to reveal

the sensitive financial information.


ADVANTAGES

• Degree of accuracy is quite high.

• It does not require extra caution.

• It depicts the data in detail.

• Primary source of data collection frequently includes definitions of various terms and units

used.

• For some investigations, secondary data are not available.

Secondary Sources:

Secondary sources of data include annual reports of UPPER DOAB SUGAR MILL,

SHAMLI. Statement of changes in working capital for the past five years is done using the

data taken from these financial reports. Similarly, time series analysis of operating cycle and

calculations of ratios is done. Apart from this, the website of UPPER DOAB SUGAR MILL,

SHAMLI is referred to know the products, product facilities, network etc.

It also contains charts & diagrams from the financial reports and annual reports which are

analyzed thoroughly in this report. Industry analysis is done based on the information

gathered from newspapers, websites of sugar mill.

Sources of secondary data:

1. Most of the calculations are made on the financial statements of the company provided

statements.

2. Referring standard texts and referred books collected some of the information regarding

theoretical aspects.

3. Method- to assess the performance of the company method of observation of the work in

finance department in followed.


Nature of Research
Descriptive research, also known as statistical research, describes data and characteristics

about the population or phenomenon being studied. Descriptive research answers the

questions who, what, where, when and how.

Although the data description is factual, accurate and systematic, the research cannot describe

what caused a situation. Thus, descriptive research cannot be used to create a causal

relationship, where one variable affects another. In other words, descriptive research can be

said to have a low requirement for internal validity.

Tools and Techniques for Analysis

MS EXCEL is used to for analysis and interpretation of data.

SAMPLING PLAN

Method of data collection: Primary & secondary

Research design: Descriptive Research Design

Research Instrument: Annual Report

Sample: Factory Campus


DATA

ANALYSIS
Balance sheet
AS AT 31st MARCH, 2017

As at March 31, 2017


Rs.
EQUITY AND LIABILITIES
Shareholders’ funds
Share capital 5,25,00,000
Reserves and surplus (38,26,92,052)
(33,01,92,052)
Non-current liabilities
Long - term borrowings 49,51,12,776
Other long term liabilities 85,01,500
Long-term provisions 5,34,43,332
Total non-current liabilities 55,70,57,608
Current liabilities
Short - term borrowings 1,11,07,39,828
Trade payables 1,22,27,05,009
Other current liabilities 35,54,72,610
Short-term provisions 10,00,10,968
Total current liabilities 2,78,89,28,415
Total 3,01,57,93,971
ASSETS
Non-current assets
Fixed assets
- Tangible assets 35,37,32,782
- Intangible assets 14,60,733
- Capital Work in Progress 29,39,021
Non - Current Investments 20
Deferred tax assets (net) 68,81,11,332
Long - term loans and advances 34,44,309
Other non - current Assets 53,25,065
Total non - current assets 1,05,50,13,262
Current assets
Inventories 1,57,39,31,362
Trade Receivables 1,66,12,280
Cash and cash equivalents 24,30,94,777
Short - term loans and advances 8,27,49,300
Other current assets 4,43,92,990
Total current assets 1,96,07,80,709
Total 3,01,57,93,971
As at March 31, 2018
Rs.
EQUITY AND LIABILITIES
Shareholders’ funds
Share capital 5,25,00,000
Reserves and surplus (695646000)

(643146000)
Non-current liabilities
Long - term borrowings 308592006
Other long term liabilities 9502000
Long-term provisions 96731002
Total non-current liabilities 414825008
Current liabilities
Short - term borrowings 1019071975
Trade payables 2109011009
Other current liabilities 457003000
Short-term provisions 9390008

Total current liabilities 3594475992


Total 3366155000

ASSETS
Non-current assets
Fixed assets
- Tangible assets 327021000
- Intangible assets 914000
- Capital Work in Progress 4996000
Non - Current Investments -
Deferred tax assets (net) 688111000
Long - term loans and advances 50000
Other non - current Assets 44366000

Total non - current assets 1065458000


Current assets
Inventories 1968305000
Trade Receivables 53608000
Cash and cash equivalents 201524000
Other financial assets 46595000
Other current assets 30665000
Total current assets 2300697000
Total 3366155000
LIMITATION

OF THE

STUDY
LIMITATION OF STUDY

Statement of financial position or Balance sheet is the essential part of the complete set of

financial statements. It is also one of the most sort after source of information for the users of

financial statement for decision making purposes. It provides an insight into the financial

status of the entity and can also provide vital information regarding the ability of the entity to

stay in the business.

However, statement of financial position or balance sheet has limitations associated with the

information contained in this financial statement. Although the limitations are situation

dependent and their effect depends on the number of factors including the degree of reliance

placed solely on the balance sheet but there are few limitations which exist in almost every

statement of financial position. Some of the important limitations are discussed below:

1. Although accounting standards, local or international, are made to help management

to produce relevant and reliable information but this in itself in many cases prove a

limitation. Strict instructions by the standards might not be a perfect fix for every

situation and might push management to report something which is not that much

meaningful as it should be.

2. Balance sheet alone do not provide all of the information needed and you might have

to look for ancillary information in other financial statements. For example to conduct

ratio analysis you need figures from other financial statements as well.

3. It does list down the asset business has but it does not tell how much money those

assets can generate in the future

4. Information is based on the past and might provide little help about the future.
5. Most of the values reported in the statement of financial position is based on historical

cost basis i.e. the item is reported on the basis of valuation conducted when the

transaction took place instead of the current basis of valuation and thus information

might be too old to be relevant and reliable for decision making purposes. This might

limit your ability to understand the current worth of the business.

6. Many assets which are internally generated are not recorded and reported in the

balance sheet which limits the pure projection of entity’s capability to generate cash

and cash equivalents. This is because the assets which do not fulfill the recognition

principle will not be reported in the balance sheet. Because of this, person looking at

the balance sheet might not get the complete understanding of entity’s strengths.

7. One of the major limitations of balance sheet and any other financial statement is that

only such information reported which can be quantified easily or at least reasonably.

Vital qualitative information is left out almost completely!

8. Statement of financial position relies on the other financial statements and many of the

numbers are pulled from income statement or statement of changes in equity etc and

thus any mistake, deliberate or not, in those financial statements will ultimately effect

the balance sheet as well. Also the limitations of those other financial statements are

also inherited by the balance sheet. Moreover, each financial statement cannot be

considered in isolation and taken separately from other financial statements. Doing so

might render useless and inaccurate information and interpretation about the entity.

9. Many of the elements are reported on aggregate basis for which even the notes to the

financial statements might not provide the complete and relevant information to

understand what is included in the figure reported and what is the value of each item

included in the total figure.


10. Many of the items reported involve the use of estimation which might not be suitable

and user might be interested in knowing how such estimates have been made and

whether such estimates are still relevant after the financial statements have been

published.

11. The “off-balance sheet” financing tactics employed by those responsible to prepare

financial statements seriously impairs the use of balance sheet as a reliable source of

information for decision making purposes.

12. It is not possible for the management to incorporate and report the effects of changing

socio-economic circumstances in the financial statements and thus the numbers in the

statement of financial position might not be an accurate representation in a given set

of conditions surrounding the entity. This becomes even more important if the entity

is operating in a politically or economically volatile environment.


SUMMARY

&

SUGGESTIONS
SUMMARY & SUGGESTIONS
This study gives in detail the analysis of comparison of balance sheets based upon the past

as well as the present performance of UPPER DOAB SUGAR MILL, SHAMLI expressed in

financial data. Based upon the results from the comparison, conclusions are driven out that

whether the company has been earning profits or not and that how much it has used these

results in its growth. So, the company can also manage each of its current assets namely

inventory management, cash management, accounts receivable management and its liabilities

like creditors, loans, bills payables etc. The research methodology adopted for this study is

mainly from secondary sources of data which includes annual reports of UPPER DOAB

SUGAR MILL, and website of the company. The use of primary sources is limited to

interviews with few employees in the finance department and from the working process

adopted in the company as interviewed from employees. The study of comparison of balance

sheets has shown that UPPER DOAB SUGAR MILL has an unhealthy base in meeting the

identical financial wealth as well as has increasing in loss from the past years. The company

is facing heavy losses. UPPER DOAB SUGAR MILL sales position is also not good. Its bad

performance is result in rise in price of product and a bad financial as well as a profitable

position in the market.

The operational areas of UPPER DOAB SUGAR MILL, SHAMLI and its performance has

been quite unsatisfactory only in some of the aspects it failed to achieve the ideal targets, so it

needs to look upon these areas and adopt certain measures which can be cost reduction,

efficient asset management, better inventory control, working capital management, managing

workforce, adopting suitable policies and there are other various sources also which can be

taken into consideration in order to enhance productivity as well as to increase the profits of

the firm by applying labor-intensive techniques or capital-intensive techniques which fits the

organization best.
CONCLUSION
CONCLUSION
Let us summarize our discussion on the structure and financing of current assets. The relative

liquidity of the firm's assets structure is measured by current to fixed assets or current asset to

total asset ratio. The greater this ratio, the less risky as well as the less profitable will be the

firm and vice versa. Similarly, the relative liquidity of the firm's financial structure can be

measured by short-term financing to total financing ratio. The lower this ratio the less risky as

well as profitable will be the firm and vice versa. In shaping its working capital policy, the

firm should keep in mind these two dimensions: relative asset liquidity (level of current

assets) and relative financing liquidity (level of short term financing of the working capital

management. A firm will be following a very conservative working capital policy if it

combines a high level of current assets with a high level of long term financing (or low level

of short term financing). Such a policy will not be risky at all but would be less profitable. An

aggressive firm on the other hand would combine low level of current assets with a low level

of long term financing (or high level of short term financing).

This firm will have high profitability and high risk. In fact, the firm the firm may follow a

conservative financing policy to counter its relatively liquid asset structure in practice. The

conclusion of all this is that the considerations of assets and financing mix are crucial to the

working capital management which is a major constraint in the working out of the financial

ratio analysis
ANNEXURE
1. a) The Company has maintained proper records showing full particulars, including

quantitative details and situation of fixed assets on the basis of available information.

b) The Company’s programme of physical verification of all its fixed assets once in three

years, is in our opinion, reasonable having regard to the size of the Company and the nature

of its fixed assets. Pursuant to such programme, a physical verification of fixed assets except

Distillery Unit was carried out during the year and the discrepancies noticed between the

book record and physical inventory have been properly accounted for in the books of account.

We were informed that physical verification of fixed assets of Distillery unit was not

conducted on account of major expansion during the year, for increase in manufacturing

capacity.

c) According to the information and explanations given to us and on the basis of our

examination of the records of the Company, the title deeds of immovable properties are

Stated to be held in the name of the Company. The original Title Deeds were not produced to

us for our verification and we were told that same are deposited as security with State Bank of

India.

2. a) During the year, the inventories have been physically verified by the management except

material sent for job work and lying with third party. In our opinion, the frequency of

verification is reasonable.

b) The discrepancies noticed on physical verification between the physical stocks and the

book records were not material, however, the discrepancies noticed have been properly

accounted for in the books of account.


3. The Company has not granted any loans, secured or unsecured to companies, firms or other

parties covered in the Register maintained under section 189 of the Act. Accordingly, the

provisions of clause of the Order are not applicable to the Company and hence not

commented upon.

4.In our opinion and according to the information and explanations given to us, the company

has complied with the provisions of section 185 and I86 of the Companies Act, 2013 with

respect to loans, investments, guarantees, and securities.

5. According to the information and explanations given to us, the Company has not accepted

any deposit from the public during the year, therefore, the provisions of the Order, is not

applicable to the Company.

6. We have broadly reviewed the cost records maintained by the Company pursuant to the

Companies (Cost Records and Audit) Rules 2014 prescribed by the Central Government

under Section of the Companies Act, 2013 and are of the opinion that, prima facie, the

prescribed accounts and cost records have been maintained. We have, however, not made a

detailed examination of the cost records with a view to determine whether they are accurate

or complete.

7. a)According to the information & explanations given to us and on the basis of our

examination of the records of the Company, there is no undisputed amounts payable in

respect of provident fund, employees’ State insurance, income-tax, value added tax, wealth-

tax, service-tax, customs duty, excise duty, cess and other material statutory dues were
Balance sheet
AS AT 31st MARCH, 2018
As at March 31,
As at March 31, 2018 2017
Rs. Rs.
EQUITY AND LIABILITIES
Shareholders’ funds
Share capital
Reserves and surplus

Non-current liabilities
Long - term borrowings
Other long term liabilities
Long-term provisions
Total non-current liabilities
Current liabilities
Short - term borrowings
Trade payables
Other current liabilities
Short-term provisions
Total current liabilities
Total
ASSETS
Non-current assets
Fixed assets
- Tangible assets
- Intangible assets
- Capital Work in Progress
Non - Current Investments
Deferred tax assets (net)
Long - term loans and advances
Other non - current Assets
Total non - current assets
Current assets
Inventories

Trade Receivables
Cash and cash equivalents
Short - term loans and advances
Other current assets
Total current assets
Total
4
9
,
5
1
,
1
2
,
7
7
6
8
5
,
0
1
,
5
0
0
5
,
3
4
,
4
3
,
3
3
2

1
,
1
1
,
0
7
,
3
9
,
8
2
8
1
,
2
2
,
2
7
,
0
5
,
0
0
9
3
5
,
5
4
,
7
2
,
6
1
0
1
0
,
0
0
,
1
0
,
9
6
8

3
,
0
1
,
5
7
,
9
3
,
9
7
1

3
5
,
3
7
,
3
2
,
7
8
2
1
4
,
6
0
,
7
3
3
2
9
,
3
9
,
0
2
1
2
0
6
8
,
8
1
,
1
1
,
3
3
2
3
4
,
4
4
,
3
0
9
5
3
,
2
5
,
0
6
5

1
,
5
7
,
3
9
,
3
1
,
3
6
2
1
,
6
6
,
1
2
,
2
8
0
2
4
,
3
0
,
9
4
,
7
7
7
8
,
2
7
,
4
9
,
3
0
0
4
,
4
3
,
9
2
,
9
9
0
STATEMENT OF PROFIT & LOSS
FOR THE YEAR ENDED 31st MARCH, 2017
For the year
For the year ended ended
March 31, March 31,
2018 2017
Rs. Rs.
Revenue from operations 3985487000 4197892000

Other Income 14192000 25326000

Total Revenue 3998779000 4223218000

Expenses

Cost of material consumed 3821159000 2785808000

Changes in Inventories of Finished goods, Work (519057000) 257865000

in progress & Stock in trade

Employee benefits expense 305293000 315822000

Finance cost 187497000 156965000

Depreciation 39796000 17377000

Other expenses 402588000 504889000

Total Expenses 4237276000 4039226000

Profit before exceptional items and tax (238497000) 183992000

Tax expenses - -

Profit after tax (238497000) 183992000

(359.4) (1385000)
Profit for the year (274437000) 182607000

Earnings per equity share

– Basic (45.428) 35.046

– Diluted (45.428) 35.046


CASH FLOW STATEMENT
For the Year ended For the Year ended
31st March, 2018 31st March 2017
(Rs. in lacs) (Rs. in lacs)
A. CASH FLOW FROM OPERATING ACTIVITIES :

Net Profit/(Loss) before tax and exceptional item as per Profit & Loss Account (2384.97) 9.00
Adjustments for : Depreciation 397.96 157.41
Interest (Net) 1709.59 1,282.90
Bad debts & claims written off (Net) 321.8 –
(Profit)/Loss on sale & Disposal of Fixed Assets (Net) 17.36 (0.22)
Prior period adjustment (Net) - (2.09)
Unclaimed Credit Balances Written Back (0.45) (63.14)
Stores Written off 1.55 1.63
Operating Profit before working capital changes 62.84 1,385.49
Adjustment for : Trade and other receivables 123.93 211.63
Inventories (4214.59) (6,673.01)
Trade Payables 8030.42 6,263.78
Cash generated from operations 4002.60 1,187.89
Prior period adjustment (Net) - 2.09
Interest paid (1063.00) (1,369.71)
Direct tax paid (Net) 9.82 (26.31)
Net Cash from operating activities 2949.42 (206.04)

B. CASH FROM INVESTING ACTIVITIES :

Purchase of fixed assets (including Intangible Assets) (167.14) (78.91)


Capital Advance (442.01) (132.30)
Sale of fixed assets 3.84 1.72
Exceptional item – 192.21
Interest received 224.48 191.98

Investment in Securities – 300.00


Net Cash used in investing activities

(380.83)
BIBLIOGRAPHY
BIBLIOGRAPHY

Reference:

 Financial management I.M. Pandey

 Financial Management R.K. Sharma & S.K.

Gupta

 Analysis of financial D.K. Goel, Rajesh Goel,

Management Shelly Goel

 Statements Financial Mohammed Hanif,

Accounting Amitabha Mukherjee

Reports:

Annual Reports of UPPER DOAB SUGAR MILL

General Articles of UPPER DOAB SUGAR MILL

Audited financial reports of UPPER DOAB SUGAR MILL

Website:

www.sirshadilal.com

www.profit.ndtv.com

www.moneycontrol.com

en.wikipedia.org

Newspapers:

Times of India

Economic Times

The Hindu

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