INTRODUCTION

MEANING OF FINANCE

Finance may be defined as the provision of money at the time. When it

is required finance refers to the management of flows of Money through an
organization. It concerns with the application of skills in the manipulation used and
control of money.

Different authorities an inter prepaid the term finance differently. However there
are three main approaches to finance.

 The first approach views finance as to providing of funds need by a business

on most suitable terms.
 The second approach relates finance to cash.
 The third approach views finance as being concerned with rising of the funds
and their effective utilization.

FINANCIAL MANAGEMENT

Financial management can be defined as the process of rising. Providing and

administrating of all money funds to be used in a business enterprise.

DEFINATIONS
 According to Mr. WHEELER:

“That business activity which is concerned in meeting the financial needs the
overall objectives of business enterprise.”

 According to Mr.

1
 GUTHAMANN & DOUGALL:

“Financial Management on be broadly as activity concerned with planning,

raising, controlling and administrating the funds used in business.”

FINANCIAL STATEMENTS

Financial statements are financial products of accounting work done during

the accounting period financial normally includes balance sheet and profit and loss
account.

The financial statements are historical documents and relates to a fast period
balance sheet is a statement of assets and liabilities indicating the financial position of
enterprise on a certain data. Trading and profit and loss account is the report of
business activities for a given period and is preparing to ascertain profits or loss for
the enterprise for that period.

The Preparation of financial statement is not the end aim. The purpose of
preparing this statement is to use for future planning and for casting and analysis and
Interpretation of these financial statement is to judge there meaning and significance
and an opinion is formed in respect to financial condition of concern.

2
SIGNIFICANCE OF FINANCIAL ANALYSIS

The purpose of financial analysis is to diagnose the information contained in

financial statement so as to judge the profitability and financial soundness of the firm.
Just like a doctor examines his patient by recording his body temperature, blood
pressure, etc. before making his conclusion regarding the illness and before giving his
treatment, a financial analysis statement with various tools of analysis before
commenting upon.

The financial health or weakness of an enterprise. The analysis and

interpretation of financial statements is essential to bring out the mystery behind the
figures in financial statements.

OBJECTIVES OF THE STUDY

Financial analysis is the process of identifying the financial strategies’ and
weakness of the firm by properly establishing relationship between the items of the
balance sheet and the profit and loss account.

 To study the firms long term solvency and survival.

 To ascertain the firms present and future profitability.
 To study the source of funds and applications and sources of cash and their
uses during the period from 2005-06, 2006-07, 2007-08,2008-09
LIMETATIONS

The data. Which has been used for the study is of only the period of 3 years. This
analysis has been made purely depend on the data.
 The methodology for the study includes only the statement analysis.
 The analysis has been done from past data financial statement of Vijaya Dairy
Milk, Karimnagar.

3
DATA AND METHODOLOGY

For this study Vijaya Dairy Milk, karimnagar has been selected. The
period of study covers 4years (2005-06, 2006-07, 2007-08) the study covers with the
following.

The present study is based on the data collected primary and secondary sources.

Primary data

The primary data is collected from various departments’ chiefs and personal of
Vijaya Dairy Milk, Karimnagar.

Secondary data

The data was also collected from books of banking and Annual reports of
Vijaya Dairy Milk, Karimnagar.

4
CHAPTERISATION

The entire study is dividing into five chapters. They are

 It deals with the introduction.

 It deals with profile organization.

 It deals with theory of financial statement analysis.

 It deals with data analysis and interpretation.

 It deals with conclusions and suggestions.

 It deals with bibliography.

5
 PROFILE OF ORGANISATION

DAIRY DEVELOPMENT IN ANDHRA PRADESH

Andhra Pradesh “Rice bowl” of south India and trendsetter in green

revolution. It is a predominantly an agricultural state with a good potential for milk
production. Andhra Pradesh has all types of natural resources that would help
emergence of the dairy industry.

In Andhra Pradesh, the first dairy was proposed in 1957 with name of “Pilot
milk supply scheme In the year 1961 a separate department of milk was establishing
including 3 districts of coastal Andhra and 3 districts of Telangana. The dairy
development department of Andhra Pradesh was converted into Dairy development
department of Andhra Pradesh was converted into Dairy Development Corporation
Limited in 1974. The objectives of APDDC are to minimize the socio-economic
change of dairy development programmers and providing employment and income to
milk producers in Andhra Pradesh through out the year.

Andhra Pradesh Government has changed the APDDC limited into a Co-
operative federation with name of Andhra Pradesh Dairy Development Co-operative
federation on limited on fifth September 1981.

The organization structure of APPDDC limited formed into milk sheds. In 25

districts of Andhra Pradesh company co-operative Sector is having 3 tired co-
operative societies. Unions and federations in order.

They are AP village level. Milk producer’s co-operative societies. AP district level.
Milk producer’s co-operative societies . AP state level. Milk producers federation.

6
 OBJECTIVES OF APDDC LIMITED

 Organize co-operatives of milk producers at village and district levels.

 Provide essential inputs to enhance milk production, feed and fodder

production, cross breeding programs ,veterinary aid, and take up development
to provide effective leadership and management skills to the milk producers
to help them manager their own 9,200 co-operatives.

 Develop infrastructure for processing milk and manufacture of dairy Products

and market wholesome and quality milk and milk products.

 Fulfill the consumer needs of liquid milk and milks products in state.

 Develop new products and packaging lines in tune with changing scenario of
consumer market and needs.

 Integrate dairy development with overall rural development efforts and

provide greater employment to the rural poor.

Today there are 7000 co-operative with 300 all women co-operative s and
membership of over 8 lakes people across the state. APDDCF is procuring milk
from formers about 8 lakes daily spread across the Andhra Pradesh and is chilling
and processing 1.6 million liters of milk every day.

APDDCF is manufacturing and marketing after by-products like different

types of ice-creams, khulfi, buttermilk, khoa, cheese, tasty milk, flavoured milk,
ultra high temperature milk, ghee and doodh peda.

The dairy has also introduced new system in distribution field. It is known as
”TETRA-Pack system” in which milk can be stored for 10 days.

7
PROFILE OF THE KARIMNAGAR DAIRY

This chapter gives detailed information about the development activities

under taken by Karimnagar dairy and profile of the organization.

In Karimnagar district, the dairy plant was established on 16th October 1971 at
Karimnagar. The work and activities of dairy wear started from with an objective to
meet the requirements of milk producers and Consumers. It was initially operated
with a plant capacity of 25000 liters per day. As the demand for the consumers and
the procurement of milk from milk producers increased day by day. The management
of karimnagar dairy thought to increase the capacity of the plant from 1992 on wards
the plant capacity has been increased to 50000 liters per day.

In Andhra Pradesh first was proposed in 1959. At that time “Pilot milk
scheme” was started to integrate the milk project with the assistance of the
“UNICFF”. In the year 1961, a separate department of milk was established including
districts at coastal Andhra Pradesh and Telangana.

In 1970. the State Government of Andhra Pradesh has established Dairy

Development, Karimnagar dairy in 1971 was started as one of is first dairy. Again
when the state government established “Andhra Pradesh Dairy Development
Corporation Limited (APDDC LTD)’ Karimnagar Dairy also came its control.

As the government of Andhra Pradesh has decide to implement Operation

flood-11 programmed in the state, the organization structure of APDDC Limited has
been changed. There fore, in 1981 PDDC limited was converted into “Andhra Pradesh
Dairy Development Co-operative Federation Limited”. Karimnagar and Adilabad
dairies came under the supervision of both is working together.

8
As the karimnager and Adilabad dairies are under control of APDDCF limited. The
management of karimnagar and Adilabad transferred the supervision power to
separate co-operative union. It is to bring the range of milk under the jurisdiction of
milk producers and to bring self-regulatory authority. Thus karimnagar and Adilabad
milk producers co-operative union was temporal established and registered. On 1-3-
1997 this union was registered finally. The elections. For the management of this co-
operative society have been held on 3.9.1997 from 1st November 1998 onwards , the
milk jurisdiction of Adilabad and Karimnagar.

District has been entrusted to karimnagar and Adilabad milk producers co-
operative union limited.

The following milk-chilling centers are under the control of Karimnagar dairy They
are

 Jagityal Chilling Center.

 Agraharam Chilling Center.
 Karimnagar main plant.
 Gundlapally bulk cooling unit.
 Koheda bulk Cooling unit.

These milk chilling centers collect milk from collection centers in the villages. The
collected milk is chilled is chilled at the concerned chilling centers and it is
transported to karimnagar dairy.

The processed milk at karimnagar dairy is marketed to the milk consumer in the
district.

Distribution of Karimnagar dairy milk can be phases.divide into the the following

9
 1. Procurement of raw milk.
2. Chilling and processing.
3. Marketing.

Procurement OF RAWMILK

Milk is procured to the dairy from milk producers especially from the former
form 500 villages with their respective Milk co-operative throughout the year and
sales will be 26000 liters per day. The sales revenues per day is 3.1 lakhs and the
monthly turn over will be 5 crore rupees.

In procurement of milk, there occur two reasons. They are:

1. Season and
2. Unseasoned(lean season)

The “season” starts from October to February in this period, the procurement of milk
increase to 1, 00, 000 liters per day. This season called as “FLUSH SEASON”. Where
as in un seasonal i.e. from March to September the procurement will be as usual that
is 60,000 liters per day and the sales will be 22,000 liters per day.

CHILLING

The procured milk is chilled at chilling centers at 40c the chilled milk goes to
nest stage called pasteurization stage.

10
PASTEURIZATION
At the pasteurization plant milk is checked for standardized SNF
content. Then the milk is heated at 720 c for 16 seconds. At this stage cream and
marketed milk (Toned Milk) is differentiated. This formed toned milk is distributed in
the district by pockets.

OBJECTIVES OF KARIMNAGAR DISTRICT MILK

AIDED CO-OPERATIVE UNION LIMITED

1. To provide a good market for rural as urban milk products.

2. To create awareness among the consumers about its products.
3. Supply pasteurized milk to the people of karimnagar of reasonable price.
4. To increase the sales by improving the quality and quantity.
5. To avoid the distance and convenience of consumers.
6. To educate the people by standard milk through advertising and marketing.
7. Fulfillment of social obligation.

PRODUCTS

Ingredients of the product package, brand, quality and product line. AP dairy
is producing several different from the milk. Those are ghee, butter milk, processed
cheddar cheese spread, Ultrahigh Temperature flavored milk (merry milk) skim milk
in tetra packs sterilized cream, skim milk powder, dairy whitener, cooking butter and
cream.

Flavored milk, doodh peda & butter milk were marketed through a network at
Vijaya dairy parlors and chain of retailers. All These products are marketed with the
brand name of "VIJAYA" several among carry "AGMARK" it is like ISI and
attention of quality by Government of India Vijaya brands is enjoying with brand

11
loyalty and brand image as formers milk in all over the country. VIJAYA brand is
also synonymous for quality originality. But, in Karimnagar dairy other than milk the
bi-products produced are:

* Butter Milk
* Doodh peda
* Sterilized Flavored milk
* Ghee

12
FINANCIAL STATEMENT ANALYSIS

Financial statement, as normally understood, refer to a set reports and

schedules that an accountant prepares at the end of a period of time for a business
enterprise. According Smith and Ashbute, financial statements the end products of
financial accounting prepared by the accountant, that purport to reveal the financial
position of the enterprise, the result of its activities and an analysis of what has been
done with the earnings.

There are six basic financial statements of special importance. They are

1. The Income statements (Profit and loss Account)

2. The position statement (Balance Sheet)
3. The fund flow Statement (Statement of source and Application of funds)
4. The cash flow statement.
5. The statement of Retaied Earnings.
6. Schedules.

1.THE INCOME STATEMENT:

The Income statement also called the profit and Loss Account is the accounting
statement period. The construction of an Income statement is an accordance with the
concept of accrual, Accounting period, matching, materality and realization. There is
no statuory format in which the income statement is to presented, except
For certain organization such as Blanking and Insurance Companies. However see
211 of the Companies Act, 1956 prescribe the contents to be disclosed in this
statement.

13
2. THE POSITION STATEMENT:

The "Position Statement" or "Balance sheet" shows the financial status of a

business at a given point of time. All the Assets owned by the business and all the
Liabilities and claims it owes to outsiders and owners are listed. The Balance Sheet
must always be in balance i.e. The Total Assets should always be equal to Liabilities.

The balance sheet of Joint stock Company must be prepared as per part A of
Schedule 6th of companies Act. Separate Statutory formats exist of the Balance Sheet
of Banking and Insurance companies.

3. THE FUNDS FLOW STATEMENT:

The term "fund" flow normally means working capital. The funds flows
statement
reveals the sources from which funds are received and the uses to which these have
been put. It is a valuable tool to analyze the changes in the financial condition of the
business between two periods and helps the management in policy formulation and
performance appraisal.

4. THE CASH FLOW STATEMENT:

The cash flow statement of changes in the financial position of a firm on

"Cash Basis" It is very much similar to the "Fund Flow" Statement, except that the
cash flow statement lays emphasis on cash change only. Sheet in greater detail.
Schedule are a part of the financial statement. They enable a better understanding of
the financial position of a business.

14
5. THE STATEMENT OF RETAINED EARNINGS:

The statement of retained earnings, also known as the Profit and Loss
Appropriation Account is a continuation of the Income Statement. It reveals the profit
freely available after deduction of all expenses including tax and how it has been
appropriated. The balance after all appropriation is shown on the liabilities side of the
balance sheet. Thus, the statement of retained earnings is the link between the income
statement and the balance sheet.

6.SCHEDULES:

Schedules are statement that describe the summarized information presented

in the Income Statement and the Balance

SIGNIFICANCE OF FINANCIAL STATEMENT ANALYSIS

The significance of financial statement lies not in their preparation and

presentation, but in their analysis and interpretation. this involves a study relationship
among various financial factors and an ability to judge their meaning and
significance. The financial analysis must understand the plans and policies of
management. Determine the extent of analysis. re-organize date available as per
requirements, establish relationship among financial figures and make interpretation
in a simple unbiased way.

15
TYPES OF ANALYSIS

The process of analysis may be classified based on the nature of information

used and on the basis of "methodology" of operations.

1) ON THE BASIS OF NATURE OF INFORMATION USED

a) EXTERNAL ANALYSIS: The information used is that which is freely available

to anybody. Published Financial Statements are an example of such information.
Three is no access to internal records of an organization. With increasing emphasis on
disclosures in recent times, the quality of external analysis is likely to improve in the
future.

b) INTERNAL ANALYSIS: The source of information in Internal Analysis is the

internal or un published records and books. Such analysis is undertaken for use of
management or for other internal need of the organization.

2. ON THE BASIS OF METHODOLOGY OF OPERATIONS

a) HORIZANTAL, ANALYSIS: It involves analysis and review of financial

statement pertaining to a number of years. An attempt is made to identify the
periodical trend of various items in the financial statement. Alternatively, a base year
is fixed and figures pertaining to other years are indexed to that of base period. It is
known as "dynamic" analysis or "trend" analysis.

b) VERTICAL ANALYSIS: Vertical analysis involves analyzing a single set

financial statement by expressing various items of the statement as a percentage ofa
particular item. Quantitative relationship is established among various items at a
particular data. It is also known as "Static" analysis or "Structural" analysis.

16
METHODS OF FINANCIALS STATEMENTS ANALYSIS

The following methods of analysis are generally used

1) COMPARATIVE STATEMENTS
2) TREND ANALYSIS
3) COMMON-SIZE STATEMENTS
4) FUNDS FLOW ANALYSIS
5) CASH FLOW ANALYSIS
6) COST-VOLUME PROFITS ANALYSIS
7) RATIO ANALYSIS

I) COMPARATIVE STATEMANT ANALYSIS

Comparative financial analysis refers to comparison of financial statements pertaining

to two different periods by putting them side and finding out the changes in absolute
and relative changes.

1. COMPARATIVE INCOME STATEMENT

Tae statement disclose the net profit or net loss resulting from the operation of
business. Such statement shows the operating result for a number of accounting
periods may be stated in terms of absolute change or in term of percentage. Since the
figures for two are more periods are shown side by side, we can quickly ascertain
what her cost of sales has increased or decreased etc. Thus only a reading of data
included in comparative income statement will be helpful in Deriving meaningful
conclusions.

17
2. COMPARATIVE POSITION STATEMENT

The statement are prepared on two or more different dates can be used for
comparing assets and liabilities and find out any increase or decrease in these item.
This facilities the comparison of figures of two or more periods and provide necessary
information which may be useful in forming an opinion regarding the financial
condition as well as progressive outlook of the concern. so it is useful in studying the
trends in an organization.

POINTS TO DENOTED

1) The financial data that is to be compared should be properly defined. A particular

account head must have the same connotation for all periods of comparison.
2) He accounting polices followed during the years of comparison should be uniform.
If there are any changes in any policy, the figures should be adjusted to ensure
uniformity.
3) It is preferable to present financial information in “Vertical” or “Statement”.
4) The comparative financial statement must reveal changes in both ”absolute” and
“relative” measures.

INTERPRETATION:

1) A change in sales is meaningful only if it is compared with a change in cost goods

sold.
2) A change in operating expenses might be due to change in scale of operations.
3) A change in net profit is a good indicator of overall profitability of the
organization.

18
4) A change in retained earnings can be on account of change in profitability, or on
account of change in dividend policy, capitalization of free reserves or change in
amounts transferred to various funds.
5) A change in working capital is good indicator of the change in current financial
position, or short-term solvency of the business.
6) A change in liquid assets is a better indicator of the change short-term solvency of
the business.
7) A change in fixed assets must be balance by change in long term funds.
8) The nature of assets, which have increased or decreased, must be studied to
understand its implications in the future.
9) relative measures provide a shaper picture then absolute measures.

II. COMMON SIZE STATEMENTS

A common size statement facilities comparison of financial statement of not

only a single firm over a time period, but also comparison of financial statement of
different companies for any given time. Under this method, all the times of statement
are presented as the percentages or ratios of a particular item. There fore. Even if the
related absolute figures are in respect of vastly different scale of operations. a
common base for comparison is created.

In case of a common size Income Statement, all items are presented as a

percentage of net sales. A Common Size Balance sheet shows each item as a
percentage of total assets or total liabilities. A common size statement helps in
determining the relative efficiency and soundness of a firm and helps in understanding
its financial strategy.

19
1. COMMONSIZE INCOME STATEMENT

This statements indicates the relationship of carious items with some common
items (Expressed as percentage of the common item) It is calculated by taking the
sales figures as base and the other figures are expressed as percentage of sales.

The common- size income statements for a number of years are helpful in
pointing out effincies and in effincies. It must be remembered that the percentages
may be influenced by variation in sale prices, higher or lower.
Cost of goods acquired or both. Common size percentages must be
supplemented. For making detained analysis is financial and operating data. It will
therefore, be more useful to use trend rations as well as individual rations showing
relationship between balance sheet and incomes statement items.

2. COMMONSIZE POSITION STATEMENT

Common Size balance sheet prepared by stating the total assets as 100 and
reducing individual assets into percentages of the total. Likewise, individual
liability items are expressed as percentages of total liabilities. Thus the
common size balance sheet a percentage shows that liability and owners
equity. A closer scrutiny of the common size balance sheet disclose that this
statement focuses on two important aspects.

 Distribution pattern of liabilities, as between current Liabilities, long term

liabilities, and equity capital.
 Distribution pattern of assets between current assets, fixed Assets and
others.

20
 COMPARATIVE INCOME STATEMENT OF VIJAYA
DAIRY MILK FOR THE YEAR OF 2005-06 TO 2006-07
ABSOLUTE RELATIVE
PURTICULARS 2005-06 2006-07 CHANGE CHANGE
NET SALES 299356188.63 333965818077. 333666461888.3 11.56
COST OF GOODS
SOLD        
OPERATING STOCK 8627062.00 708764.00 -7918298.00 -17.84
+PURCHASE 26334701.00 945565736.50 919231035.50 34.90
+CARRAIGE
INWORDS 10621882.00 11432828.00 810946.00 7.63
+CONVERTION
CHARGES 2057634.00 2575625.00 517991.00 25.17
+ELECTRICITY
CHARGES 2064326.00 2369978.00 305652.00 14.81
HAMAL CHARGES 145346.00 33546.00 -111800.00 76.92
  286950951.00 318366337.50 31415386.50 10.95
-CLOSING STOCK 7087624.00 8070264.00 982640.00 13.86
COST OF GOODS
SOLD 279863327.00 310296073.00 30432746.00 10.87
GROSS PROFIT
(SALES-COGS) 19492861.63 23669745.27 4176883.64 21.43
(-)OPERATING
EXPENSES        
SALARY
ALLOWANCE 10047086.00 11057126.00 1010040.00 10.05
ADIMISTRATION
EXPENCES 3857213.50 4167145.50 309932.00 8.04
SALES
COMMISSION 912025.00 1311125.00 399100.00 43.76
DEPRECIATION 302556.00 3517437.00 3214881.00 10.62
REPAIRS&MAINTAI
NACE 1800932.00 2347679.00 546747.00 30.36
RATE&TAXES 441972.00 641729.00 199757.00 45.20
MEETING&OTHER 144704.00 371465.00 226761.00 156.71
SALES&TAXES 1371147.00 1617137.00 245990.00 17.94
CARRAIGE
OUTWORD 3431353.00 3913478.00 482125.00 14.05
TOTALOPERATING
EXPENCES 25032058.50 289443221.50 264411163.00 10.56
OPERATINGPROFIT
(GRASSPROPFIT-
TOTALOPERATING
EXPENCES) -5539196.87 -5274576.23 264620.64 -4.78

EXPENCES        

21
 -NON OPERATING
EXPENCES        
  -5539196.9 -5274576.23 264620.64 -4.78

+NON OPERATING
EXPENCES        

TRANSPORT
RECEAVED 2084798 2679845 595047 28.54

INTEREST ON FDR 1007269 1717692 710423 70.53

INTEREST ON
ELECTRICITY
DIPOSITY 257083 967308 710225 276.26

OTHER INCOMES 4032265 5263562 1231297 30.54

NET
PROFIT(PROFIT
BEFORE
INTEREST&TAX) 1842218.13 5713830.77 3871612.64 210.16

_-INTEREST        

PROFIT BEFORE
TAX 1842218.13 5713830.77 3871612.64 210.16
(-)TAX        

PROFIT AFTER TAX 1842218.13 5713830.77 3871612.64 210.16

INTERPRETATION:

22
From the above analysis we may conclude the following.

1. When compared to the last year sales, sales in the year 2006-07
increased.11.05% & cost of good sold increased in the same year compared
to the last year by 10.87%.

2. When compared to the last year, there is an increase in gross profit

i.e, 21.43% in the year 2006-07. This increase is due to more increase sales
than the increase in cost of goods sold.

3. There is decrease in operating profit by 4.78% in 2006-07.This due to

the higher increase in operating expenses than the gross profit. It proves that
firm need the follow the cost reduction method.

4. There is a significant increase in profit in after tax i.e., 210.16%.This

result is from increase in non-operating incomes & in gross profit.

5. Overall profitability of the concern is much satisfactory but the firm

should follow cost reduction method.

COMPARATIVE POSITION STATEMENT OF VIJAYA

DAIRY MILK FOR THE YEAR 2005-06&2006-07

23
 ABSOLUTE RELATIVE
PARTICULAS 2005-06 2006-07 CHANGES CHANGES
ASSETS        
A)CURRENT
ASSETS        
CASH AT BANK        
SBH 454726.57 545679.57 90953.00 20.00
CANERA BANK 117490.00 217490.00 100000.00 85.11
IOB 14686718.00 24686718.00 10000000.00 68.09
DICRICT
COPARATIVE
CENTRAL BANK 8436000.00 9476022.00 1040022.00 12.33
BANK AT JGTL 1000.00 1000.00 0.00 0.00
CASH IN HAND 334333.00 443474.00 109141.00 32.64
ADVANCE TO THE
CUSTAMER 85000.00 88358.00 3358.00 3.95
SUNDRAY
DEBITORD 15852618.25 17448712.50 1596094.25 10.07
CLOSING STOCK 7087624.00 8070264.00 982640.00 13.86
TOTAL CURRENT
ASSETS(A) 24047703.90 2694129015.00 2670081311.10 11.10
B)FIXED ASSERTS        
LAND 394650.00 494650.00 100000.00 25.34
BUILDING 1300942.00 1300942.00 0.00 0.00
PLANTS AND
MACHINARY 4277406.00 4277406.00 0.00 0.00
VEHICLE 98571.00 92175.00 6396.00 6.49
FURNITURU 87788.00 100871.00 13083.00 14.90
OFFICE EQUIPMENT 195399.00 195399.00 0.00 0.00
DAIRY EQUIPMENT 292964.00 292721.00 243.00 0.08
TOTAL FIXED
ASSETS(B) 6647720.00 6754164.00 106444.00 1.60
C)INVESTMENTS        
TOTAL
ASSETS(A+B+C) 3695423.90 33695454.15 30000030.25 8.11

24
A)CURRENT LIABILITES        
OUTSTANDING
SALARIES 98591.00 1067109.00 968518.00 9.82
OUTSTANDING
CARRIES 389122.00 907927.00 518805.00 133.33
LIABILITIES        
OUTSTANDING
ELECTRICITY 406542.00 806948.00 400406.00 98.49
OUTSTANDING
VECHICAL
MAINTANNCE 84919.00 391647.00 306728.00 361.20
OUTSTANDING
TRAVELLING
EXPENCES 33740.00 90476.00 56736.00 168.16
OUTSTANDINGSALES
COMMISION 1117971.00 1319376.00 201405.00 18.02

SUNDRY CREDITORS 2862410.00 2934319.38 71909.38 2.51

TOTAL(A) 5880410.00 7517802.00 1637392.00 27.84

(B)LONG TERM DEBTS        

LONGTERM LONES 7500000.00 7000000.00 500000.00 6.67

TOTAL(B) 7500000.00 7000000.00 500000.00 6.67
(C)CAPITALS&RESERVE
S        
WOMEN DAIRY
PROJECT 1011865.00 1011865.00 0.00 0.00
MF FUNDS 7000000.00 6000000.00 1000000.00 14.29
DRDA FUNDS 4797500.00 4446512.00 350988.00 7.32
IDDP 2005444.00 2005444.00 0.00 0.00

PROFI&LOSS ACCOUNT 2500000.00 5713830.00 3213830.00 128.55

TOTAL© 17314809.13 19177657.77 1862848.64 10.76

D)TOTAL LONG TERM

FUNDS (B+C) 24814809.13 26177651.77 1362842.64 5.49

TOTAL LIABILITES (A+D) 30695423.90 33695454.15 3000030.25 9.77

25
INTERPRETATION:

1. LIQUIDITY POSITION: Increase in current assets compared to the 2006-07 .

Is 12.03% in the year 2005-06. The increase in current liabilities compared to the last
year 27.84% increase in current assets is less than the increase in current liabilities. It
represents of the concern. Liquidity position has decreased compared to the last year.

2. LONGTERN FINANCIAL POSITION: There is an increase in fixed assets is

1.60% when compared with the 2005-06. It should be form the increase in total long-
term funds. There is an increase in total long-term funds as 5.49%.

3. PROFITABILITY POSITION: When compared to the last year, profit of 2006-

07 increased by 128.55%. From this we can conclude that the profitability position
of the concern has increased in current year & it has sound profitability position.
4. OVERALL FINANCIAL POSITION: Overall financial position of the concern
reaches satisfactory level but the concern has to increase its liquidity position
either by increasing current assets or decreasing current liabilities.

26
 COMPARATIVE INCOME STATEMENT OF VIJAYA
DAIRY MILK FOR THE YEAR 2006-07&2007-08
ABSOLUTE RELATIVE
PURTICULARS 2006-07 2007-08 CHANGE CHANGE
NET SALES 33965818.77 394527676.75 360561857.98 10.62
COST OF GOODS
SOLD        
OPERATING
STOCK 7087624.60 8076954.00 989329.40 13.96
+PURCHASE 294565736.50 345296485.00 50730748.50 17.22
+CARRAIGE
INWORDS 11432828.00 12167596.00 734768.00 6.43
+CONVERTION
CHARGES 2575625.00 3219796.00 644171.00 25.01
+ELECTRICITY
CHARGES 2369978.00 2718786.00 348808.00 14.72
HAMAL CHARGES 334546.00 779465.00 444919.00 132.99
  318366337.50 372259022.00 53892684.50 16.93
-CLOSING STOCK 8070264.00 17132543.20 9062279.20 112.29
COST OF GOODS
SOLD 310296073.50 363282478.80 52986405.30 17.08
GROSS PROFIT
(SALES-COGS) 23669745.27 31245197.95 7575452.68 32.00
(-)OPERATING
EXPENSES        
SALARY
ALLOWANCE 11057126.00 11934413.00 877287.00 7.93
ADIMISTRATION
EXPENCES 4167145.50 4547314.00 380168.50 9.12
RATES&TXES 641729.00 879812.00 238083.00 37.10
MEETING&OTHERE
XPENSES 371465.00 727317.00 355852.00 95.80
SALES&TAXES 1617137.00 2017315.00 400178.00 24.75
CARRAIGE
OUTWORD 3913478.00 4415716.00 502238.00 12.83
SALES
COMMISSION 1311125.00 1728297.00 417172.00 31.82
DEPRECIATION 3517437.00 3998792.00 481355.00 13.68

27
 REPAIRS &
MAINTAINANCE 2347679.00 2718986.00 371307.00 15.82

TOTAL OPERATING
EXPENCES 28944321.00 32967962.00 4023641.00 13.90
OPERATINGPROFIT(GRA
SSPROPFIT-
TOTALOPERATINGEXPEN
CES) -5274576.23 -1722764.05 3551812.18 -67.34

+NON OPERATING
EXPENCES
-5274576.23 -17227664.05 3551812.18 -67.34

TRANSPORT RECEAVED 2679845.00 3172158.00 492313.00 18.37

INTEREST ON FDR 1717692.00 2248712.00 531020.00 30.91

INTEREST ON
ELECTRICITY DIPOSITS 967308.00 1214563.00 247255.00 25.56
OTHER INCOMES 5623562.00 6047781.00 424219.00 7.54

NET PROFIT(PROFIT
BEFORE ITAX) 5713530.77 10960449.95 5246919.18 91.83
_-INTEREST

PROFIT BEFORE TAX(PBT 5713830.77 10960449.95 5246619.18 91.82

(-)TAX

PROFIT AFTER TAX(PAT) 5713830.77 10960449.95 5246619.18 91.82

INTERPRETATION

28
From the above analysis we may conclude the following.

1.There is increase in sales compared to last year, 18.13%&cost of goods is

also increased of goods sold increase by 17.08%

2. When compared to the last year, there is an increase in gross profit i.e,
32% in the year 2007-08. This increase is due to more increase sales than the
increase in cost of goods sold.
3. There is decrease in operating profit by 67.33%.This is result from the
higher increase in operating expenses than the gross profit.

4. There is a significant increase in profit in after tax in the year 2007-08

compared to last year’s is 91.82% .This result is from increase in non-operating
incomes & in gross profit.

5. Overall profitability of the concern is much satisfactory. However, it

should follow the cost reduction policies.

COMPARATIVE POSITION STATEMENT OF VIJAYA

DAIRY MILK FOR THE YEAR 2006-07&2007-08

29
 ABSOLUTE RELATIVE
PARTICULAS 2006-07 2007-08 CHANGES CHANGES
ASSETS
A)CURRENT
ASSETS
CASH AT BANK
SBH 545679.57 767561.50 221881.93 40.66
IOB 246867.18 537982.00 291114.82 117.92
DICRICT
COPARATIVE
CENTRAL BANK 94760.00 134396.00 39636.00 41.83
BANK AT JGTL 1000.00 1000.00 0.00 0.00
CASH IN HAND 443474.00 793834.00 350360.00 79.00
ADVANCE TO THE
CUSTAMER 88358.00 9319381.00 9231023.00 104.47
SUNDRAY
DEBITORD 17448712.50 19023417.00 1574704.50 9.02
CLOSING STOCK 8070246.00 8976543.20 906297.20 11.23
TOTAL CURRENT
ASSETS(A) 26941290.15 39558059.70 12616769.55 46.83
B)FIXED ASSERTS
LAND 494650.00 723506.00 228856.00 46.27
BUILDING 1300942.00 1412546.00 111604.00 8.58
PLANTS AND
MACHINARY 4277406.00 406312.00 -181094.00 -4.23
VEHICLE 9275.00 90137.00 -2038.00 -21.97
FURNITURU 100871.00 150112.00 49241.00 48.82
OFFICE
EQUIPMENT 195399.00 301319.00 105920.00 54.21
DAIRY EQUIPMENT 292721.00 451812.00 159091.00 54.35
TOTAL FIXED
ASSETS(B) 6754164.00 7225744.00 471580.00 6.98
C)INVESTMENTS
TOTAL
ASSETS(A+B+C) 33695454.15 46783803.70 13088349.55 38.84
LAIBILITEIS
A)CURRENT
LIABILITES
OUTSTANDING
SALARIES 907927.00 1917569.00 1009642.00 111.20
OUTSTANDING
CARRIES 1067109.00 2314367.00 1247258.00 116.88

OUTSTANDING -
ELECTRICITY 806948.00 0.00 -806948.00 100.00

30
OUTSTANDING
TRAVELLING EXPENCES 90476.00 302546.00 212070.00 234.39

OUTSTANDING SALES
COMMISION 1319376.00 3452287.70 2132911.70 161.66

SUNDRY CREDITORS 2934319.38 3895127.00 960807.62 32.74

TOTAL(A) 7517802.38 13206065.70 5688263.32 75.66

(B)LONG TERM DEBTS 7000000.00 6500000.00 -500000.00 -7.14

TOTAL(B) 7000000.00 6500000.00 -500000.00 -7.14

(C)CAPITALS&RESERVES        

WOMEN DAIRY PROJECT 1011865.00 1011865.00 0.00 0.00

MF FUNDS 6000000.00 6000000.00 0.00 0.00
DRDA FUNDS 4446512.00 4446512.00 0.00 0.00
IDDP 2005444.00 2005444.00 0.00 0.00

PROFI&LOSS ACCOUNT 5713830.77 13613917.00 7900086.23 138.26

TOTAL© 19177651.77 27077738.00 7900086.23 41.19

D)TOTAL LONG TERM

FUNDS (B+C) 26177651.77 33577738.00 7400086.23 28.27

TOTAL LIABILITES (A+D) 33695454.15 46783803.00 13088348.85 38.84

31
INTERPRETATION:

1. LIQUIDITY POSITION: Increase in current assets compared to the 2006-07 .

Is 48.83%in the year 2007-08.

2.LONGTERN FINANCIAL POSITION: There is an increase in fixed assets is

6.98% in 2007-08.the increase in total ling-term funds is 28.27%.increase in fixed
assets is less than the increase in total long-term funds. It proves fixed assets are
purchased from the long-term funds & it said to belongs term financial position is
satisfactory.
3. PROFITABILITY: When compared to the last year there is atremedous increase
in 2007-08, is 138.26%. it shows that the profitability position is concern is much
satisfactory.

4. OVERALL FINANCIAL POSITION: Overall financial position of the concern

reaches satisfactory level but the concern has to increase its liquidity position either
by increasing current assets or by reducing liabilities.

32
 COMPARATIVE INCOME STATEMENT OF VIJAYA
DAIRY MILK FOR THE YEAR OF 2007-08 TO 2008-09
ABSOLUTE RELETIVE
PURTICULARS 2007-08 2008-09 CHANGE CHANGE
NET SALES 394527676.75 405615875.76 11088199.01 2.81
(-)COST OF GOODS
SOLD        
OPERATING STOCK 8076954.00 9168946.00 1091992.00 13.52
(+)PURCHASE 345296485.00 455393496.00 110097011.00 31.88
(+)CARRAIGE
INWORDS 12167596.00 21358687.00 9191091.00 75.54
(+)CONVERTION
CHARGES 3219796.00 4238897.12 1019101.12 31.65
+ELECTRICITY
CHARGES 271886.00 382986.00 111100.00 40.86
HAMAL CHARGES 779465.00 885566.00 106101.00 13.61
  369812182.00 491428578.12 121616396.12 32.89
(-)CLOSING STOCK 897654.20 996745.30 99091.10 11.04
COST OF GOODS
SOLD 363282478.80 454391569.80 91109091.00 25.08
GROSS PROFIT
(SALES-COGS) 31245197.95 42154289.90 10909091.95 34.91
(-)OPERATING
EXPENSES        
SALARY
ALLOWANCE 11934413.00 23846710.00 11912297.00 99.81
ADIMISTRATION
EXPENCES 454731.00 546845.10 92114.10 20.26

SALES COMMISSION 1728297.00 2369381.00 641084.00 37.09

DEPRECIATION 3998792.00 4019788.00 20996.00 0.53
REPAIRS&MAINTAIN
ACE 2718986.00 3811965.00 1092979.00 40.20
RATE&TAXES 879812.00 970956.00 91144.00 10.36
MEETING&OTHER 727317.00 889408.00 162091.00 22.29
SALES&TAXES 2017315.00 3129951.00 1112636.00 55.15
CARRAIGE
OUTWORD 4415716.00 5922861.00 1507145.00 34.13

TOTALOPERATING
EXPENCES 28875379.00 45507865.00 16632486.00 57.60

33
OPERATINGPROFIT(
GRASSPROPFIT-
TOTALOPERATINGEX
PENCES) -3095644.40 -4169921.10 -1074276.70 34.70
EXPENCES        

(+)NON OPERATING
EXPENCES -3095644 -4169921.1 -1074276.70 34.70
TRANSPORT
RECEAVED 3172158 4629001.00 1456843.00 45.93

INTEREST ON FDR 2248712 3568172 1319460.00 58.68

INTEREST ON
ELECTRICITY
DIPOSITY 1214563 2263873 1049310.00 86.39

OTHER INCOMES 6047781 7950708 1902927.00 31.46

NET PROFIT(PROFIT
BEFORE
INTEREST&TAX) 126832.14 184117.54 57285.40 45.17
(-)INTEREST        

PROFIT BEFORE TAX 12683214 18411754 5728540.00 45.17

(-)TAX        

PROFIT AFTER TAX 12683214 18411754 5728540.00 45.17

34
INTERPRETATION:

1. When compared to the last year sales, sales in the year 2008-09
increased. 11.05%&cost of goods sold increased in the same year compared to
the last year.

2. When compared to the last year, there is an increase in gross profit i.e,
21.43% in the year 2008-09. This increase is due to more increase sales than
the increase in cost of goods sold.

3. There is decrease in operating profit by 4.78% in 2008-09.This due to

the higher increase in operating expenses than the gross profit. It proves that
firm need the follow the cost reduction method.

4. There is a significant increase in profit in after tax i.e., 210.16%.This

result is from increase in non-operating incomes & in gross profit.

5. Overall profitability of the concern is much satisfactory but the firm

should follow cost reduction method.

COMPARATIVE POSITION STATEMENT OF VIJAYA

35
 DAIRY MILK FOR THE YEAR 2007-08&2008-09

ABSOLUTE RELATIVE
PARTICULAS 2007-08 2008-09 CHANGES CHANGES
ASSETS
A)CURRENT
ASSETS
CASH AT
BANK
SBH 767561.50 898670.52 131109.02 17.08
IOB 537982.00 629895.00 91913.00 17.08
DICRICT
COPARATIVE
CENTRAL
BANK 134396.00 246489.00 112093.00 8.34
BANK AT JGTL 1000.00 2305.00 1305.00 1.31
CASH IN HAND 793834.00 819856.00 26022.00 3.28
ADVANCE TO
THE CUSTAMER 9319381.00 9887663.00 568282.00 6.10
SUNDRAY
DEBITORD 19023417.00 28100510.00 9077093.00 47.72
CLOSING
STOCK 8976543.20 9086551.30 110008.10 1.23
TOTAL
CURRENT
ASSETS(A) 39554114.00 49671939.00 10117825.00 25.58
B)FIXED
ASSERTS
LAND 723506.00 834180.00 110674.00 15.30
BUILDING 1412546.00 2613625.00 1201079.00 0.85
PLANTS AND
MACHINARY 406312.00 631201.00 224889.00 55.35
VEHICLE 90137.00 98893.00 8756.00 9.71
FURNITURU 150112.00 261003.00 110891.00 73.87
OFFICE
EQUIPMENT 301319.00 410621.00 109302.00 36.27
DAIRY
EQUIPMENT 451812.00 568813.00 117001.00 25.90
TOTAL FIXED
ASSETS(B) 3535744.00 10183336.00 6647592.00 188.01
C)INVESTMENT
S
TOTAL
ASSETS(A+B+C) 43089858.00 59855275.00 16765417.00 38.91

36
 LIABILITIES

A)CURRENT LIABILITES
OUTSTANDING
SALARIES 1917569.00 2836778.00 919209.00 47.94

OUTSTANDING CARRIES 2314367.00 3426289.00 1111922.00 48.04

LIABILITIES
OUTSTANDING
ELECTRICITY 0.00 91789.00 91789.00 100.00

OUTSTANDING
VECHICAL MAINTANNCE
OUTSTANDING
TRAVELLING EXPENCES 302546.00 377456.00 74910.00 24.76

OUTSTANDINGSALES
COMMISION 3452287.70 4026262.00 573974.30 16.63
SUNDRY CREDITORS 3895127.00 4022676.00 127549.00 3.27
TOTAL(A) 12700128.70 14781250.00 2081121.30 16.39

(B)LONG TERM DEBTS 6500000.00 6800000.00 300000.00 4.62

LONGTERM LONES 700000.00 700000.00 0.00 0.00

TOTAL(B) 6500000.00 6800000.00 300000.00 4.62
(C)CAPITALS&RESERVES
WOMEN DAIRY PROJECT 1011865.00 1512628.00 500763.00 49.49
MF FUNDS 6000000.00 6000000.00 0.00 0.00
DRDA FUNDS 4446512.00 4446512.00 0.00 0.00
IDDP 2005444.00 2005444.00 0.00 0.00

PROFI&LOSS ACCOUNT 13613917.00 14514857.00 900940.00 6.62

TOTAL© 27077738.00 28479441.00 1401703.00 5.18
D)TOTAL LONG TERM
FUNDS (B+C) 33577738.00 35279441.00 1701703.00 5.07

TOTAL LIABILITES (A+D) 46277866.70 50060691.00 3782824.30 8.17

37
INTERPRETATION:

1. LIQUIDITY POSITION: Increase in current assets compared to the 2007-08

Is 48.83%in the year 2008-09.

2. LONGTERN FINANCIAL POSITION: There is an increase in fixed assets is

6.98% in 2008-09.the increase in total ling-term funds is 24.27%.increase in fixed
assets is less than the increase in total long-term funds. It proves fixed assets are
purchased from the long-term funds & it said to belongs term financial position is
satisfactory.
3. PROFITABILITY: When compared to the last year there is atremedous increase
in 2008-09, is 138.26%. it shows that the profitability position is concern is much
satisfactory.

4. OVERALL FINANCIAL POSITION: Overall financial position of the concern

reaches satisfactory level but the concern has to increase its liquidity position either
by increasing current assets or by reducing liabilities.

38
 COMMON SIZE INCOME STATRMENT OF VIJAYA DAIRY MILK FOR
OF THE YEAR 2005-06 & 2006-07

2005-06 2006-07
PARTICULARS AMOUNT % AMOUNT %
NET SALES 299356188.63 100.00 333965818.77 100.00

COST OF GOODS SOLD

OPERATING STOCK 8627062.00 3.01 7087264.00 2.23

+PURCHASE 263434701.00 91.84 294565736.00 92.52

+CARRAIGE INWORDS 10621882.00 3.70 11432828.00 3.59

+CONVERTION CHARGES 2064326.00 0.72 2575625.00 0.81

+ELECTRICITY CHARGES 2064326.00 0.72 2369978.00 0.74

HAMAL CHARGES 145346.00 0.05 334546.00 0.11

286850951.00 100.00 318366337.50 100.00

-CLOSING STOCK 7087624.00 2.36 8070264.00 2.41

COST OF GOODS SOLD 279863327.00 93.48 310296073.50 92.91

GROSS PROFIT (SALES-
COGS) 19492861.63 6.51 23669745.27 7.09

(-)OPERATING EXPENSES

SALARY ALLOWANCE 10047086.00 3.35 11057126.00 3.31

ADIMISTRATION EXPENCES 3857213.50 1.28 4167145.50 1.24

RATES&TAX 441972.00 0.14 641729.00 0.19

MEETING&OTHEREXPENSES 144704.00 0.04 371465.00 0.11

SALES&TAXES 1371147.00 0.45 1617137.00 0.11

CARRAIGE OUTWORD 3431353.00 1.14 3913478.00 1.17

SALES COMMISSION 912025.00 0.30 1311125.00 0.39

DEPRECIATION 3025626.00 1.01 3517437.00 1.05

REPAIRS&MAINTANANCE 0.6 0.07

39
TOTAL OPERATING
EXPENCES 25032058.5 8.36 28944321.5 8.66

OPERATINGPROFIT(GRAS
SPROPFIT-TOTAL -
OPERATINGEXPENCES) 5539196.87 1.85 5274576.23 -1.57
-NON OPERATING
EXPENCES        
-
  5539196.87 1.85 5274576.23 -1.57

=+NON-OPERATINING
INCOMES        

TRANSPORT RECEAVED 2084798 0.69 2679845 0.08

INTEREST ON FDR 1007269 0.33 1717692 0.51

INTEREST ON
ELECTRICITY DIPOSITS 257083 0.08 967308 0.28
OTHER INCOMES 4032265 1.34 5223562 1.56

NET PROFIT(PROFIT
BEFORE ITAX) 1842218.13 0.61 5713830.77 1.71
_-INTEREST       1.56

PROFIT BEFORE TAX(PBT) 1842218.13 0.61 5713830.77 1.71

(-)TAX        

PROFIT AFTER TAX(PAT) 1842218.13 0.61 5713830.77 1.71

INTERPERE

40
 TATION

From the above analysis we may conclude the following points.

1. Compared to the last year, cost of sales as a percentages of

next sales has decreased.

2. Gross profit as percentage of next sales has increased

because of slight decreased in cost of sales in the current.

3. profit after tax has increased in the current year compared to

last year. This is due to increase non-operating income.

4. financial position & profitability position of the concern is

satisfactory. But the firm need to improve more.

COMMON SIZE POSITON STATEMENT OF VIJAYA DAIRY MILK FOR

OF THE YEAR 2005-06 & 2006-07

41
 2005-06 2006-07
PARTICULARS AMOUNT % AMOUNT %
ASSETS
A)CURRENT
ASSETS
CASH AT BANK
SBH 454726.57 0.15 545679.57 1.62
CANARA BANK 1174.90 0.00 2174.90 0.01
IOB 146867.18 0.05 246867.18 0.73
DICRICT
COPARATIVE
CENTRAL BANK 84360.00 0.03 94760.00 0.28
BANK AT JGTL 1000.00 0.00 1000.00 0.00
CASH IN HAND 334333.00 0.11 443474.00 1.32
ADVANCE TO THE
CUSTAMER 85000.00 0.03 88358.00 0.26
SUNDRAY DEBITORD 158526.25 0.05 17448712.50 51.78
CLOSING STOCK 7087624.00 2.31 8070264.00 23.95
TOTAL CURRENT
ASSETS(A) 24047703.00 7.83 26941290.00 79.96
B)FIXED ASSERTS
LAND 394650.00 0.13 494650.00 1.47
BUILDING 1300942.00 0.42 1300942.00 3.86
PLANTS AND
MACHINARY 4277406.00 1.39 4277406.00 12.69
VEHICLE 98571.00 0.03 92175.00 0.27
FURNITURU 87788.00 0.03 100871.00 0.30
OFFICE EQUIPMENT 195399.00 0.06 195399.00 0.58
DAIRY EQUIPMENT 292964.00 0.10 292721.00 0.87
TOTAL FIXED
ASSETS(B) 6647720.00 2.17 6754164.00 20.04
C)INVESTMENTS

TOTAL ASSETS(A+B+C) 306954223.00 100.00 33695454.15 100.00

42
 LAIBILITEIS

A)CURRENT LIABILITES
OUTSTANDING
SALARIES 985910.00 3.21 1067209.00 3.17

OUTSTANDING CARRIES 389122.00 1.27 907927.00 2.69

OUTSTANDING
ELECTRICITY 406542.00 1.32 806948.00 2.39

OUTSTANDING
TRAVELLING EXPENCES 33740.00 0.11 90476.00 0.27

OUTSTANDING VAHICLE
MAINTENNANCE 84919.00 0.28 391647.00 1.16

OUTSTANDINGSALES
COMMISION 11117971.00 36.22 1319376.00 3.92

SUNDRY CREDITORS 2862410.00 9.33 2934319.36 8.71

TOTAL(A) 5880614.77 19.16 7517802.38 22.31

(B)LONG TERM DEBTS 0.00 0.00

LONG TERM LOANS 7500000.00 24.43 7000000.00 20.77

TOTAL (B) 7500000.00 24.43 7000000.00 20.77

(C)CAPITALS&RESERVES 0.00 0.00

WOMEN DAIRY PROJECT 1011865.00 3.30 1011865.00 3.00

MF FUNDS 7000000.00 22.80 6000000.00 17.81
DRDA FUNDS 4797500.00 15.63 44465512.00 131.96
IDDP 2005444.00 6.53 2005444.00 5.95

PROFI&LOSS ACCOUNT 2500000.00 8.14 57138.00 0.17

TOTAL© 17314809.13 56.41 19177651.77 56.91

D)TOTAL LONG TERM

FUNDS (B+C) 24814809.10 80.84 26177651.77 77.69

TOTAL LIABILITES (A+D) 30695423.90 100.00 33695454.15 100.00

43
INTERPRETATION:

1. SHORT TERM FINANCIAL POSITION: There is an increased current

assets as a part of total assets compared to the last year. There is an increase in
current liabilities. this proves that the liquidity position of the concern is not
bad.

2. LONG-TERM FINANCIAL POSITION: There is a decrease in fixed assets

as a part of total compared to the last year. This may result from more usages of
them. This is a decreased in long-term funds as a part of total liabilities.

Overall long-term position is satisfactory.

1. PROFITABILITY POSITION: There is a slight increase in reserves &

surplus as a part of total liabilities in current year. It proves that the
profitability position is satisfactory.
2. OVERALL FINANCIAL POSITION: The overall financial position is good
but the firm has to increase its profitability & liquidity position by following
cost reducing methods.

44
COMMON SIZE INCOME STATRMENT OF VIJAYA DAIRY MILK FOR
OF THE YEAR 2006-07 & 2007-08
2006-07 2007-08
PARTICULARS AMOUNT % AMOUNT %
333965818.7 394527676.7
NET SALES 7 100.00 5 100.00
COST OF GOODS SOLD
OPERATING STOCK 7087624.00 2.12 8076954.00 2.42
294565736.5 345296485.0
+PURCHASE 0 88.20 0 103.39

+CARRAIGE INWORDS 11432828.00 3.42 12167536.00 3.64

+CONVERTION CHARGES 2575625.00 0.77 3219796.00 0.96

+ELECTRICITY CHARGES 2369978.00 0.71 2718786.00 0.81

HAMAL CHARGES 3345546.00 1.00 779465.00 0.23
318366337.5 372259022.0
0 95.33 0 111.47
-CLOSING STOCK 8070264.00 2.42 8976543.00 2.69
310296073.0 363282478.9
COST OF GOODS SOLD 0 92.91 5 108.78
GROSS PROFIT (SALES-
COGS) 23669745.27 7.09 31245197.95 9.36
(-)OPERATING EXPENSES
SALARY ALLOWANCE 11057126.00 3.31 11934413.00 3.57

ADIMISTRATION EXPENCES 4167145.50 1.25 4547314.00 1.36

RATES&TAX 641729.00 0.19 879812.00 0.26
MEETING&OTHEREXPENSES 371465.00 0.11 727317.00 0.22
SALES&TAXES 1617137.00 0.48 2017315.00 0.60
CARRAIGE OUTWORD 3913478.00 1.17 4415716.00 1.32
SALES COMMISSION 1311125.00 0.39 1728297.00 0.52
DEPRECIATION 3517437.00 1.05 3998792.00 1.20
REPAIRS&MAINTANANCE 2347679 0.70 2718986 0.81

45
 TOTAL OPERATING
EXPENCES 28944321 8.67 32967962 9.87

OPERATINGPROFIT(G
RASSPROPFIT-
TOTALOPERATINGEX
PENCES) -5274576.23 -1.58 -1722764.05 -0.52

-NON OPERATING
EXPENCES 0.00 0.00
-5274576.23 -1.58 -1722764.05 -0.52

=+NON-OPERATINING
INCOMES
TRANSPORT
RECEAVED 2679845 0.80 3172158 0.95

INTEREST ON FDR 1717692 0.51 2248712 0.67

INTEREST ON
ELECTRICITY
DIPOSITS 967308 0.29 1214563 0.36

OTHER INCOMES 5623562 1.68 6047781 1.81

NET PROFIT(PROFIT
BEFORE ITAX) 5713830.77 1.71 10960449.95 3.28
_-INTEREST 0.00 0.00

PROFIT BEFORE
TAX(PBT) 5715830.77 1.71 10960449.95 3.28
(-)TAX 0.00 0.00
PROFIT AFTER
TAX(PAT) 5713830.77 1.71 10960449.95 3.28

46
INTERPRETATION:

1. Compared to the last year, cost of sales as a percentage of net sales has
decreased.
2. There is a slight increase in gross profit because of the decrease of cost of
sales.
3. The operating profit of the concern has decreased when compared to last year.
The firm should follow cost reduction methods to reduce operating expenses.
4. The profit after tax of the concern has increased in the current year compared
to the last year.
5. The financial position & profitability of the concern are satisfactory. However
the concern should improves it self to reach the standards.

47
COMMON SIZE POSITON STATEMENT OF VIJAYA DAIRY MILK FOR
OF THE YEAR 2006-07 & 2007-08

2006-07 2007-08
PARTICULARS AMOUNT % AMOUNT %
ASSETS
A)CURRENT
ASSETS
CASH AT BANK
SBH 545679.57 1.62 767561.50 1.64
CANARA BANK 2174.90 0.01 3945.00 0.01
IOB 246867.18 0.73 537982.00 1.15
DICRICT
COPARATIVE
CENTRAL BANK 94760.00 0.28 134396.00 0.29
BANK AT JGTL 1000.00 0.00 1000.00 0.00
CASH IN HAND 443474.00 1.32 793834.00 1.70
ADVANCE TO THE
CUSTAMER 88358.00 0.26 9319381.00 19.92
SUNDRAY DEBITORD 17448712.50 51.78 19023417.00 40.66
CLOSING STOCK 8070264.00 23.95 897654.20 1.92
TOTAL CURRENT
ASSETS(A) 26441290.15 78.47 39558059.70 84.56
B)FIXED ASSERTS 0.00 0.00
LAND 494650.00 1.47 723506.00 1.55
BUILDING 1300942.00 3.86 1412546.00 3.02
PLANTS AND
MACHINARY 4277406.00 12.69 4096312.00 8.76
VEHICLE 92175.00 0.27 90137.00 0.19
FURNITURU 100871.00 0.30 150112.00 0.32
OFFICE EQUIPMENT 195399.00 0.58 301319.00 0.64
DAIRY EQUIPMENT 292721.00 0.87 451812.00 0.97
TOTAL FIXED
ASSETS(B) 6754164.00 20.04 7225744.00 15.44
C)INVESTMENTS 0.00 0.00
TOTAL
ASSETS(A+B+C) 33695454.15 100.00 46783803.70 100.00

48
 LAIBILITEIS
A)CURRENT LIABILITES
OUTSTANDING
SALARIES 1067109.00 3.17 2314367.00 4.95

OUTSTANDING CARRIES 907927.00 2.69 1917569.00 4.10

OUTSTANDING
ELECTRICITY 806948.00 2.39 0.00 0.00
OUTSTANDING HAMALI
CHARGES 0.00 0.00 717627.00 1.53
OUTSTANDING
TRAVELLING EXPENCES 904776.00 2.69 302546.00 0.65

OUTSTANDING VAHICLE
MAINTENNANCE 391647.00 1.16 606542.00 1.30

OUTSTANDINGSALES
COMMISION 1319376.00 3.92 3452287.70 7.38

SUNDRY CREDITORS 2934319.38 8.71 3895127.00 8.33

TOTAL(A) 7517802.38 22.31 13206065.70 28.23

(B)LONG TERM DEBTS 0.00 0.00

LONG TERM LOANS 7000000.00 20.77 6500000.00 13.89

TOTAL (B) 7000000.00 20.77 6500000.00 13.89

(C)CAPITALS&RESERVES

WOMEN DAIRY PROJECT 1011865.00 3.00 1011865.00 2.16

MF FUNDS 6000000.00 17.81 6000000.00 12.82
DRDA FUNDS 4446512.00 13.20 4446512.00 9.50
IDDP 2005444.00 5.95 2005444.00 4.29

PROFI&LOSS ACCOUNT 5713830.77 16.96 13613946.00 29.10

TOTAL© 19177651.77 56.91 27077738.00 57.88

D)TOTAL LONG TERM

FUNDS (B+C) 26177651.77 77.69 33576735.92 71.77

TOTAL LIABILITES (A+D) 33695454.15 100.00 46783803.70 100.00

49
INTERPRETATION:

1. SHORT TERM FINANCIAL POSITION: There is an increased current

assets as a part of total assets compared to the last year. There is all so increase
in current liabilities as a part of the total liabilities. It means that the liquidity
position of the concern is not satisfactory.

2. LONG-TERM FINANCIAL POSITION: There is a decrease in fixed assets as

a part of total assets. This is also a decreased in long-term funds. The long-term
position is satisfactory .
3 PROFITABILITY POSITION: There is a slight increase in reserves & surplus
as a part of total liabilities in current year. It proves that the profitability
position is satisfactory.
3. OVERALL FINANCIAL POSITION: The overall financial position is good
but the firm has increase its liquidity position & long-term position by
following effective measures to reduce cost.

50
 COMMON SIZE INCOME STATRMENT OF VIJAYA DAIRY MILK FOR
OF THE YEAR 2007-08 & 2008-09
2007-08 2008-09
PARTICULARS AMOUNT % AMOUNT %
394527676.7 414266234.2
NET SALES 5 100.00 0 100.00
COST OF GOODS SOLD        

OPERATING STOCK 8076954.00 2.17 8566674.00 2.05

345296485.0 387244285.0
+PURCHASE 0 92.76 0 92.82

+CARRAIGE INWORDS 12167536.00 3.27 13257436.00 3.18

+CONVERTION CHARGES 3219796.00 0.86 4218796.00 1.01

+ELECTRICITY CHARGES 2718786.00 0.73 3018876.00 0.72

HAMAL CHARGES 779465.00 0.21 897645.00 0.22

372259022.0 417203712.0
  0 100.00 0 100.00

-CLOSING STOCK 8976543.00 2.41 9567345.00 2.29

363282478.9 402382874.9
COST OF GOODS SOLD 5 97.59 0 96.45
GROSS PROFIT (SALES-
COGS) 31245197.80 8.39 11883359.30 2.85
(-)OPERATING EXPENSES        
SALARY ALLOWANCE 11934413.00 3.21 12343314.00 2.96
ADIMISTRATION EXPENCES 4547314.00 1.22 4874314.00 1.17
RATES&TAX 879812.00 0.24 969762.00 0.23

MEETING&OTHEREXPENSES 727317.00 0.20 872137.00 0.21

SALES&TAXES 2017315.00 0.54 2271315.00 0.54
CARRAIGE OUTWORD 4415716.00 1.19 4817816.00 1.15

SALES COMMISSION 1728297.00 0.46 2018432.00 0.48

DEPRECIATION 3998792.00 1.07 4289972.00 1.03

REPAIRS&MAINTANANCE 2718986.00 0.73 3018896.00 0.72

51
 TOTAL OPERATING
EXPENCES 32967962.00 8.86 35475958.00 8.50

OPERATINGPROFIT(G
RASSPROPFIT-
TOTALOPERATINGEXP
ENCES) 1722764.05 0.46 23592598.70 5.65
(-)NON OPERATING
EXPENCES -1722764.00 -0.46 -23592598.00 -5.65
(+)NON-OPERATINING
INCOMES 0.00 0.00
TRANSPORT
RECEAVED 3172158.00 0.85 3462518.00 0.83
INTEREST ON FDR 2248712.00 0.60 2852721.00 0.68
INTEREST ON
ELECTRICITY
DIPOSITS 1214563.00 0.33 1441635.00 0.35

OTHER INCOMES 6047781.00 1.62 7057871.00 1.69

NET PROFIT(PROFIT
BEFORE ITAX) 10960449.95 2.94 14150559.00 3.39
_(-)INTEREST 0.00 0.00
PROFIT BEFORE
TAX(PBT) 10960449.95 2.94 14150559.00 3.39
(-)TAX
PROFIT AFTER
TAX(PAT) 10960449.95 2.94 14150559.00 3.39

52
INTERPRETATION:

1 Compared to the last year, cost of sales as a percentage of net sales has
decreased.
2. There is a slight increase in gross profit because of the decrease of cost of
sales.
3. The operating profit of the concern has decreased when compared to last year.
The firm should follow cost reduction methods to reduce operating expenses.
4. The profit after tax of the concern has increased in the current year compared
to the last year.
5. The financial position & profitability of the concern are satisfactory. However
the concern should improves it self to reach the standards.

53
COMMON SIZE POSITON STATEMENT OF VIJAYA DAIRY MILK FOR
OF THE YEAR 2007-08 & 2008-09
2007-08 2008-09
PARTICULARS AMOUNT % AMOUNT %
ASSETS
A)CURRENT
ASSETS

CASH AT BANK
SBH 767561.50 5.31 777561.00 4.84
CANARA BANK 3945.50 0.03 4212.00 0.03
IOB 537982.00 3.72 545892.00 3.40
DICRICT
COPARATIVE
CENTRAL BANK 134396.00 0.93 176936.00 1.10
BANK AT JGTL 1000.00 0.01 1526.00 0.01
CASH IN HAND 793834.00 5.49 844384.00 5.25
ADVANCE TO THE
CUSTAMER 9319381.00 64.49 9424831.00 58.63

SUNDRAY DEBITORD 19023417.00 131.64 19224127.00 119.59

CLOSING STOCK 897654.20 6.21 920646.00 5.73
TOTAL CURRENT
ASSETS(A) 31479170.20 217.83 31920115.00 198.57
B)FIXED ASSERTS 0.00 0.00
LAND 723506.00 5.01 813605.20 5.06
BUILDING 1412546.00 9.77 1626666.00 10.12
PLANTS AND
MACHINARY 4096312.00 28.35 4669132.00 29.05
VEHICLE 90317.00 0.62 96446.00 0.60
FURNITURU 150112.00 1.04 175211.00 1.09
OFFICE EQUIPMENT 301319.00 2.09 316762.00 1.97

DAIRY EQUIPMENT 451812.00 3.13 499962.00 3.11

TOTAL FIXED
ASSETS(B) 7225744.00 50.00 7876844.00 49.00
C)INVESTMENTS
TOTAL
ASSETS(A+B+C) 14451488.00 100.00 16074628.20 100.00

54
 LAIBILITEIS
A)CURRENT
LIABILITES
OUTSTANDING
SALARIES 2314367.00 5.75 3015675.00 8.12
OUTSTANDING
CARRIES 1917569.00 4.76 2376699.00 6.40
OUTSTANDING
ELECTRICITY 0.00 0.00
OUTSTANDING
TRAVELLING
EXPENCES 302546.00 0.75 315626.00 0.85

OUTSTANDING
VAHICLE
MAINTENNANCE 606542.00 1.51 807646.00 2.17

OUTSTANDINGSALE
S COMMISION 3452287.70 8.57 4022762.00 10.83
SUNDRY
CREDITORS 3895127.50 9.67 4279167.00 11.52
TOTAL(A) 13206065.70 32.78 7886462.00 21.23
(B)LONG TERM
DEBTS 0.00 0.00

LONG TERM LOANS 6500000.00 16.14 6500000.00 17.50

TOTAL (B) 6500000.00 16.14 6500000.00 17.50
(C)CAPITALS&RESER
VES 0.00 0.00
WOMEN DAIRY
PROJECT 1011865.00 2.51 1226826.00 3.30
MF FUNDS 6000000.00 14.89 6000000.00 16.15
DRDA FUNDS 4446512.00 11.04 4949567.00 13.33
IDDP 2005444.00 4.98 2506692.00 6.75
PROFI&LOSS
ACCOUNT 13613946.00 33.80 14573629.00 39.24
TOTAL © 27077767.00 67.22 29256714.00 78.77

D)TOTAL LONG
TERM FUNDS (B+C) 33577767.00 83.35 35756714.00 96.27

TOTAL LIABILITES
(A+C) 40283832.70 100.00 37143176.00 100.00

55
INTERPRETATION:

1.SHORT TERM FINANCIAL POSITION: There is an increased current

assets as a part of total assets compared to the last year. There is all so increase in
current liabilities as a part of the total liabilities. It means that the liquidity position
of the concern is not satisfactory.

2. LONG-TERM FINANCIAL POSITION: There is a decrease in fixed assets

as a part of total assets. This is also a decreased in long-term funds. The long-term
position is satisfactory .

3.PROFITABILITY POSITION: There is a slight increase in reserves & surplus

as a part of total liabilities in current year. It proves that the profitability position is
satisfactory.

4.OVERALL FINANCIAL POSITION: The overall financial position is good

but the firm has increase its liquidity position & long-term position by following
effective measures to reduce cost.

56
 CONCLUSIONS & SUJJESTIONS

COMPARATIVE INCOME STATEMENT FOR THE YEAR 2005 –

06 & 2006-07

1. In these years, the increase is higher than the increase in cost of goods
sold.

2. There is an increase in gross profit due to excess of sales over cost of

goods sold

3. There is a decrease in operating profit due to excess of operating

expenses of operating expenses over gross profit.

4. There is a significant increase in profit after tax.

5. Overall is a profitability position of the concern is much satisfactory. It

has to follow some cost reduction measures.

FOR THE YEAR 2006-07&2007-07

1. In these years, the increase in sales is higher than the increase in cost
of goods sold.

2. There is an increase in gross profit.

3. Operating profit is decreased because of higher increase in operating

expenses increase in gross profit.

4. Profit after tax increased in these years.

5. Overall profitability of the concern is satisfactory.

57
COMPARATIVE POSITION STATEMENT FOR THE YEAR 2005-
06& 2006-07

1. Liquidity position of the concern is not good. It has to improve its

liquidity position.

2. Long-term financial position is satisfactory.

3. The profitability position of the concern is excellent.

4. Overall financial position is at satisfactory level but it has to improve its

liquidity level.

FOR THE YEAR 2006-07& 2007-08

1. Liquidity position of the vijaya Dairy is not good. It has to improve a lot.

2. Long – term financial position is at satisfactory level but is has to

improve its liquidity level.

3. Profitability position is also good.

4. Overall financial performances are good. It proves the soundness of

good management.

58
COMMON SIZE INCOME STATEMENT FOR THE YEAR 2005-
06& 2006- 07

1. In these years, the cost of sales as a percentage of net sales has

decreased.

2. Gross profit as a percentage of net sales has increased.

3. Operating profit has decreased with the effects of increase in operating

expenses.

4. Profit after tax has increased compared to the last year.

5. Profitability position of the Vijaya dairy is good.

FOR THE YEAR 2006-07&2007-08:

1. Cost of sales as a percentage of net sales has decreased.

2. Slight increase in gross profit as a result of decrease in cost of sales.

3. Operating profit of the concern has decreased. To avoid this situation

concern has to concentrate on reducing of operating expenses.

4. Profit after tax of the concern has increased.

5. Profitability position of the vijaya diary is so good.

COMMON SIZE POSITION STATEMENT FOR THE YEAR2005-

06& 2006-07:

1. The increase in current assets as a part of total assets is less than the
increase in current liabilities as a part of total liabilities
.
2. Overall long term position of vijaya diary milk is good.

3. Profitability position and reserves and surpluses are well – maintained.

4. Overall financial performance of vijaya diary is good. It need to work

out on liquidity position.

59
FOR THE YEAR 2006-07& 2007-08

1. Liquidity position as a part of total assets & total liabilities is not good. It has
to be well improved.

2. The long- term financial position is not satisfactory for which it has to
reduce the dependence an external sources for finance.

3. The reserves & surpluses are increased overall profitability position of

vijaya diary is good.

4.Overall performance is good but it has to work out in liquidity & long term
financial position to attain its objectives & goals.

60
 BIBLIOGRAPHY

1. FINANCIAL MANAGEMENT : I M PANDEY

2. MANAGEMENT ACCOUNTING : R K SHARMA

3. FINANCIAL MANAGEMENT : SHASHI K. GUPTHA

4. ANNUAL REPORTS OF VIJAYA DIARY MILK, KARIMNAGAR

5. Website: www. Vijayadiary. Com

61