A STUDY ON WORKING CAPITAL MANAGEMENT IN IIR

TECHNOLOGIES
 CHAPTER-I

INTRODUCTION
The Project has been done in IIR TECHNOLOHIES,CHENNAI.
The title of the project is A Study on the Working Capital Management.
The study starts with a Companys profile and also the need for study,
review of literature and objectives are set out for the study. Research
methodology, Data analysis & Interpretation, Findings and Suggestions of
the study follow.
One of the main areas of the project is the analysis part, where the
data are analyzed & interpreted, to find out the working capital. Some of the
tools used in working capital are regarding to:

Ratio Analysis
Comparative Financial Statements.
Trend Analysis.
And then conclusions, limitations & scope for further study were
discussed

Working capital is the capital required for maintenance of day-

to-day business operations. The present day competitive market environment
calls for an efficient management of working capital. The reason for this is
attributed to the fact that an ineffective working capital management may
force the firm to stop its business operations, may even lead to bankruptcy.
Hence the goal of working capital management is not just concerned with
the management of current assets & current liabilities but also in maintaining
a satisfactory level of working capital.
DEFINITION:
Working capital is formally arrived at by subtracting the current
liabilities from current assets of a firm on the day the balance sheet is drawn
up. Working capital is also represented by a firms net investment in current
assets necessary to support its everyday business. Working capital frequently
changes its form and is sometimes also referred to as circulating capital.
According to Gretsenberg: circulating capital means current assets of a
company that are changed in the ordinary course of business from one form
to another.
Types of working capital
Working capital, as mentioned above, can take different forms. For
example, it can take the form of cash and then change to inventories and/or
receivables and back to cash.
Gross and Net Working Capital:
The total of current assets is known as gross working capital whereas
the difference between the current assets and current liabilities is known as
the net working capital.
Permanent Working Capital:
This type of working capital is the minimum amount of working
capital that must always remain invested. In all cases, some amount of cash,
stock and/or account receivables are always locked in. These assets are
necessary for the firm to carry out its day to day business. Such funds are
drawn from long term sources and are necessary for running and existence
of the business.
Variable Working Capital:
Working capital requirements of a business firm might increase or
decrease from time to time due to various factors. Such variable funds are
drawn from short-term sources and are referred to as variable working
capital.
Working capital, also known asnet working capitalor NWC, is a
financialmetric which represents operating liquidityavailable to a business.
Along with fixedassets such as plant and equipment, working capital is
considered a part of operatingcapital. It is calculated ascurrent
assetsminuscurrent liabilities. If current assets are lessthan current liabilities,
an entity has aworking capital deficiency, also called aworkingcapital
deficit.
Working Capital = Current Assets Current Liabilities
A company can be endowed withassets and profitabilitybut short of
liquidityif its assetscannot readily be converted into cash. Positive working
capital is required to ensure that afirm is able to continue its operations and
that it has sufficient funds to satisfy bothmaturing short-term debt and
upcoming operational expenses. The management of working capital
involves managing inventories, accounts receivable and payable and cash.
The present research seeks to study in depth the Working Capital
Management of selected paper companies in India, with special emphasis on
an examination of themanagement performance in regard to financial
management. It hardly needsmentioning that inventory, accounts receivables
and cash and its alert administrationcan go a long way in solving the
problem of the efficient working capitalmanagement. In fact, the present
research of working capital management needsspecial attention for the
efficient working and the business. It has been often observedthat the
shortage of working capital leads to the failure of a business. The
propermanagement of working capital may bring about the success of a
business firm. Themanagement of working capital includes the management
of current assets andcurrent liabilities. The present research undertakes to
deal with the net concept ofworking capital: excess of current assets over
current liabilities.
A number of companies for the past few years have been finding it
difficult to solve the increasing problems of adopting seriously the
management of workingcapital. Business concerns intent on developing their
business have to use to theutmost, their available resources for the
improvement and development of thebusiness there by enabling them to
increase their profits. Working Capital and changein working capital,
especially in inventories, which is one of the components ofworking capital
form a very important part of the total gross-capital formation in thepaper
companies. Efficient and the optimal utilization of fixed assets is very
closelyrelated to the proper management of working capital. The present
research attempts torecognize initially the importance of working capital as a
part of the total capital. Itfurther goals to recognize the factors influencing
the working capital, its volume, andin the process try to suggest remedial
measures which might help in optimizing theuse of working capital. It also
considers as to how precisely financing workingcapital and further more
what should be mix of different components of workingcapital.
Holding of current assets in substantial amount strengthens the
liquidity position & reduces the riskiness but only at the expense of
profitability. Therefore achieving risk-return trade-off is significant in
holding of current assets. While cash outflows are predictable it runs
contrary in case of cash inflows. Sales program of any business concern does
not bring back cash immediately. There is a time lag that exists between sale
of goods & sales realization. The capital requirement during this time lag is
maintained by working capital in the form of current assets. The whole
process of this conversion is explained by the operating cycle concept.

Working capital management involves the relationship between a

firm's short-term assets and its short-term liabilities. The goal of working
capital management is to ensure that a firm is able to continue its operations
and that it has sufficient ability to satisfy both maturing short-term debt and
upcoming operational expenses. The management of working capital
involves managing inventories, accounts receivable and payable, and cash.
There are many ratios that can be calculated from the financial
statements pertaining to a company's performance, activity, financing and
liquidity. Some common ratios include the price-earnings ratio, debt-equity
ratio, earnings per share, asset turnover and working capital.

Working Capital is the life blood of every business concern. Business

firm cannot make progress without adequate working capital. Inadequate
working capitalmeans shortage of inputs, whereas excess of it leads to extra
cost. So the quantum ofworking capital in every business firm should be
neither more nor less than what isactually required. The management has to
see that funds invested as working capitalin their organization earn return at
least as much as they would have earned return if itinvested anywhere else.
At the time of increasing capital costs and scare funds, thearea of working
capital management assumes added importance as it deeplyinfluences a
firm's liquidity and profitability. A notable feature of utilization of fundsis
that they are of recurring nature.
Therefore, efficient working capital managementrequires a proper
balance between generation and utilization of these funds withoutwhich
either shortage of funds will cause obstruction in the smoother functioning
ofthe organization or excess funds will prevent the firm from conducting its
businessefficiently.
So the main objective of working capital management is to arrange
theneeded funds on the right time from the right source and for the right
period, so that tradeoff between liquidity and profitability may be achieved.

Another important aspect of working capital management is to

analyze the total working capital needs of the firm in order to find out the
permanent and temporary working capital. Working capital is required
because of existence of operating cycle. The lengthier the operating cycle,
greater would be the need for working capital. The operating cycle is a
continuous process and therefore, the working capital is needed constantly
and regularly. However, the magnitude and quantum of working capital
required will not be same all the times, rather it will fluctuate.

The need for current assets tends to shift over time. Some of these
changes reflect permanent changes in the firm as is the case when the
inventory and receivables increases as the firm grows and the sales become
higher and higher. Other changes are seasonal, as is the case with increased
inventory required for a particular festival season. Still others are random
reflecting the uncertainty associated with growth in sales due to firm's
specific or general economic factors.

The working capital needs can be bifurcated as:

Permanent working capital
Temporary working capital
Permanent working capital:
There is always a minimum level of working capital, which is
continuously required by a firm in order to maintain its activities. Every firm
must have a minimum of cash, stock and other current assets, this minimum
level of current assets, which must be maintained by any firm all the times,
is known as permanent working capital for that firm. This amount of
working capital is constantly and regularly required in the same way as fixed
assets are required. So, it may also be called fixed working capital.

Temporary working capital:

Any amount over and above the permanent level of working capital is
temporary, fluctuating or variable working capital. The position of the
required working capital is needed to meet fluctuations in demand
consequent upon changes in production and sales as a result of seasonal
changes.

The permanent level is constant while the temporary working capital

is fluctuating increasing and decreasing in accordance with seasonal
demands as shown in the figure.
In the case of an expanding firm, the permanent working capital line
may not be horizontal. This is because the demand for permanent current
assets might be increasing (or decreasing) to support a rising level of
activity. In that case line would be rising.
FINANCING OF WORKING CAPITAL

There are two types of working capital requirements as discussed

above. They are:
Permanent or Fixed Working Capital requirements
Temporary or Variable Working Capital requirements
Therefore, to finance either of these two working capital
requirements, we have long-term as well as short-term sources.

FACTORS DETERMINING WORKING CAPITAL

REQUIREMENTS
There are many factors that determine working capital needs of an
enterprise. Some of these factors are explained below:
Nature or Character of Business.
The working capital requirement of a firm is closely related to the
nature of its business. A service firm, like an electricity undertaking or a
transport corporation, which has a short operating cycle and which sells
predominantly on cash basis, has a modest working capital requirement. Oh
the other hand, a manufacturing concern like a machine tools unit, which has
a long operating cycle and which sells largely on credit, has a very
substantial working capital requirement.
IIR is a manufacturing concern so this requires them to keep a very
sizeable amount in working capital.
 Size of Business/Scale of Operations.
IIR has a good position in its segment and they are also spending their
operations in the domestic market as well as in foreign market. The scale of
operations and the size it holds in the market makes it a must for them to
hold their inventory and current asset at a huge level.
Rate of Growth of Business.
The rate of growth of sales indicates a need for increase in the
working capital requirements of the firm. As the firm is projected to increase
their sales by 69% from what it was in 2009, it is required to guard them
against the increasing requirements of the net current asset by way of
efficient working capital management. The sales and projected sales level
determine the investment in inventories and receivables.

Price Level Changes.

Changes in the price level also affect the working capital
requirements. It was the reduced margins in the price of the raw materials
that had prompted them to go for bulk purchases thus making on additions to
their net current assets. They might have gone for this large-scale
procurement for availing discounts and anticipating a rise in prices, which
would have meant that more funds are required to maintain the same current
assets.

WORKING CAPITAL CYCL

The upper portion of the diagram above shows in a simplified form
the chain of events in a manufacturing firm. Each of the boxes in the upper
part of the diagram can be seen as a tank through which funds flow. These
tanks, which are concerned with day-to-day activities, have funds constantly
flowing into and out of them.
The chain starts with the firm buying raw materials on credit.
In due course this stock will be used in production, work will be
carried out on the stock, and it will become part of the firms work-in-
progress.
Work will continue on the WIP until it eventually emerges as
the finished product.
As production progresses, labor costs and overheads need have
to be met.
Of course at some stage trade creditors will need to be paid.
When the finished goods are sold on credit, debtors are
increased.
They will eventually pay, so that cash will be injected into the
firm.

Each of the areas- Stock (raw materials, WIP, and finished goods),
trade debtors, cash (positive or negative) and trade creditors can be viewed
as tanks into and from which funds flow.
Working capital is clearly not the only aspect of a business that affects
the amount of cash.
The business will have to make payments to government for
taxation.
Fixed assets will be purchased and sold
Lessors of fixed assets will be paid their rent
Shareholders (existing or new) may provide new funds in the
form of cash
 Some shares may be redeemed for cash
Dividends may be paid
Long-term loan creditors (existing or new) may provide loan
finance, loans will need to be repaid from time-to-time, and
Interest obligations will have to be met by the business
Unlike, movements in the working capital items, most of these non-
working capital cash transactions are not every day events. Some of them
are annual events (e.g. tax payments, lease payments, dividends, interest
and, possibly, fixed asset purchases and sales). Others (e.g. new equity and
loan finance and redemption of old equity and loan finance) would typically
be rarer events.

STATEMENT OF THE PROBLEM:

Working capital constitutes part of the Crown's investment in a

department. Associated with this is an opportunity cost to the Crown.
(Money invested in one area may "cost" opportunities for investment in
other areas.) If a department is operating with more working capital than is
necessary, this over-investment represents an unnecessary cost to the Crown.

OBJECTIVES OF THE STUDY

IIR TECHNOLOGIES has been managing the various aspect of
working capital through continuous efforts over a long period of time.
The present study is trying to investigate the different aspects of
working capital management at IIR TECHNOLOGIES. Working
capital is generally the net difference between the total assets and the
 liabilities of the company. So an attempt to understand as to how the
company manages the working capital has been done
In my project work we are trying to identify the various systematic
processes in managing the working capital.
The study is trying to identify the various liquidity, profitability,
solvency and the turnover positions of the company as a tool of
performance which will lead us to identify the financial soundness of
the company.

SCOPE OF THE STUDY:

The study is conducted at IIR TECHNOLOGIES, Internship for 3
weeks duration. The study of Working capital management is purely
based on secondary data and all the information is available within the
company itself in the form of records.
To get proper understanding of this concept, I have done the study of
the balance sheets, profit and loss A/Cs, cash accounts, trial balance,
and cost sheets. I have also conducted the interviews with employees
of accounts and finance department and stores department.
So, scope of the study is limited up to the availability of official
records and information provided by the employees.
The study is supposed to be related to the period of last five years.

LIMITATIONS OF THE STUDY

As central purchase office, purchase raw material and central
marketing yarn make sales. Information that is so more detailed
cannot be received about these.
 Cash from debtors a collected by the corporate office through
commission agents. So efforts for collection of debtors cannot be
clearly known from IIR TECHNOLOGIES in CHENNAI.
Investment of funds are also made by corporate office, so it becomes
difficult to know that how much investment is made in different ways
for continuous availability of funds.

SIGNIFICANCE OF THESTUDY:

From a department's point of view, excess working capital means

operating inefficiencies. In addition, unnecessary working capital increases
the amount of the capital charge which departments are required

RESEARCH METHODOLOGY

RESEARCH DESIGN
A research design is the arrangement of conditions for collection and
analysis of data in a manner that aims to combine relevance to the research
purpose with economy in procedure.

The formidable problem that follows the task of defining the research
problem is the preparation of the design of the research project, popularly
known as the research design. Decisions regarding what, where, when,
how much, by what means concerning an inquiry or a research study
constitute a research design.

DATA SOURCE:

PRIMARY DATA

The primary data are those which are collected a fresh and for the first
time, and thus happened to be original in character. Primary data include the
information collected from the officials and existing company through
discussions.

SECONDARY DATA

Secondary data means that are already available i.e. they refer to the
data which have already been collected and analyzed by someone else.
Secondary data may either be published data or unpublished data. Usually
published data are available in various publications of the central, state, local
governments. Also in technical and trade journals, books, magazines and
newspapers, reports and publications of various associations connected with
business and industry, banks, stock exchanges reports prepared by research
scholars universities in different fields
This study is period for the annual reports and statements of accounts
extended from the years

TOOL FOR THE STUDY

 During the course of research for the researcher for analysis and
interpretation o data is given below has applied various tools.
Ratios analysis
Comparative balance sheet
Trend analysis

LIMITATIONS OF THE STUDY

The study conducted and done is analytical, subject to the following

limitations
The study is mainly carried out based on the secondary data provided
in the financial statements
This study is based on the historical data and information provided in
the annual reports therefore it may not be a future indicator
There may be some fractional differences in the calculated ratios
As the study was for short span of 3 weeks and due to lack of time
other areas could not be well focused
 CHAPTER-II
INDUSTRY PROFILE
INTRODUCTION TO THE INDUSTRY
Indian software industry has been witnessing a phenomenal growth
for the last three decades. The software industry is expected to play a vital
role in the growth of Indian Economy. However the ability of the software
industry to sustain its growth will depend upon its ability to integrate needs
of its international customers and aspirations of Indian software
professionals. Software professionals from India aspire for and are capable
of being global citizens. Based on in-depth analysis, this Research explores
the human issues being experienced by Indian software organizations. It also
suggests to overcome some of the human challenges to make this field the
safest field.
But at the same time, this field is having much more problems which
make the IT as an unstable one. This is because of lack of planning and not
able to fulfil the expectations and requirements of Human Resource
Management.
GROWTH OF INDIA'S IT INDUSTRY
India's IT industry has recorded phenomenal growth over the last
decade. During the period from 1992-2001, the compounded annual growth
rate of the Indian IT services industry has been over 50%. The software
sector in India has grown at almost double the rate of the US software sector.
The statistics of the India's IT industry substantiates the huge
momentum acquired by the IT sector in the recent past. During the financial
year 2000-2001, the software industry in India accounted for $8.26 billion.
The corresponding figure was $100 million 10 years back. The year 2008
was marked by unprecedented global economic crisis.
The Global economy slipped into severe recession in 2008 inflicted by
a massive financial crisis and acute loss of confidence. This has cast its
shadow on the Indian economy, which is estimated to grow at 6.7 per cent in
2008-09 as compared to 9.0 per cent in the fiscal year 2007-08. In spite of
this uncertain global outlook, the Indian Information TechnologyBusiness
Process Outsourcing (IT-BPO) industry was able to achieve sustainable
growth in the fiscal year 2008-09. The revenue IIR TECHgregate of IT-BPO
industry is expected to grow by over 12 per cent and reach US $ 71.7 billion
in 2008-09 as compared to US $ 64 billion in 2007-08.
Industry performance was marked by sustained double-digit revenue
growth, steady expansion into newer service lines and increased geographic
penetration. The Indian software and services exports including ITES-BPO
exports is estimated at US $ 47 billion in 2008- 09, as compared to US $
40.4 billion in 2007-08, an increase of 16.3 per cent. The IT services exports
is estimated to be US $ 26.9 billion in 2008- 09 as compared to US $ 23.1
billion in 2007-08, showing a growth of 16.5 per cent 21 in 2008-09. ITES-
BPO exports is estimated to grow from US $ 10.9 billion in 2007-08 to US $
12.8 billion in 2008-09, a year-on-year (Y-o-Y) growth of over 17.4 per
cent.
It has created immense opportunities for employment and has
contributed to the growth of National Income. It has also spawned the
mushrooming of several ancillary industries such as transportation, real
estate, catering and has created a rising class of young consumers with high
disposable incomes, triggered a rise in direct-tax collections and propelled
an increase in consumer spending.
This represents a net addition of 226,000 professionals to the industry
employee base in 2008-09. The indirect employment attributed to the sector
is estimated to be about 8.0 million.
The industry has also set a precedent for talent practices in India. It
has created career opportunities for the youth, provided global exposure and
offered extensive training and development. Furthermore, the industry has
been a frontrunner in diversity at the workplace (over 30 per cent of
employees are women; over 60 per cent of industry players employ
differently abled people).
The IT- industrys contribution to the national GDP is estimated to
increase from 5.5 per cent in 2007-08 to 5.8 per cent in 2008-09. The growth
of India's IT sector has brought about many other positive changes in the
Indian economy.
HUMAN RESOURCES IN THE SOFTWARE INDUSTRY:
The following statements characterize the Human Resources in the
Software Industry:
 The Human Resource function plays a key and very important role, as
it is a People Centered organization.
Employees are knowledge workers. Majority of them are qualified
professionals and then were toppers in colleges and are very ambitious and
so, they seek a fast track career.
They expect challenges from the start, highly creative, highly
sensitive, motivation is the key for performance.
Prefer informal environment, openness /trust.
About 25 to 30% proceed to United States at the earliest; hence all
actions aimed towards this move. All this is driven by peer pressure, life
style, savings and improvement in their profile.
Basically performance driven organization.

ISSUES IN THE SOFTWARE INDUSTRY

The Indian software industry is currently in a situation where most

companies have more projects than they can handle i.e. they do not have the
necessary human resources to satisfy the potential demand for their services.
At the same time, in most companies it is observed that the capacity
utilization of the manpower is not satisfactory high i.e. there is significant
bench-time for a resource.
This paradox has persisted because of lopsided manpower planning,
hiring and staffing practices. Seen in the frame work of 28 the newsboy
problem, the cost of overstocking of human resources is not high enough
compared to the cost of under stocking, which leads to the phenomenon of
companies recruiting people for a project much before they have contracted
that project.
This is further compounded by the severe attrition problem that piIIR
TECHues the Indian software industry it is not possible to predict the
attrition levels and at the same time there is a shortIIR TECHe of high-
skilled professionals in the competitive labour market, so this causes a
problem with the both the efficiency (high bench-time) as well as the
effectiveness (low acceptance to offer ratios) of recruiting and staffing
activities.
Moreover if the software industry is to be successful in the longer
term, it is imperative that companies move up to IT value chain from
activities such as maintenance, offshore development and sub-contracting to
systems integration, process improvement and strategic IT consulting.
In order to accomplish this, they need access to a manpower base,
which is skilled not only in technology but also has thorough knowledge of
business and Management processes and practices.
This manpower base is still underdeveloped in India and unless there
are initiatives taken by all the major players, including the Government, the
industry will fail to exploit the growth potential.
Within the HR planning function, there is the issue of classifying
resources in order to enable efficient project staffing. Due to the explosion of
technologies in the information space, it has become increasingly difficult
for companies to translate project requirements into manpower requirements
and consequently skill requirements and at the same time organize
complementary skills into sets, which can then be treated as resource
competencies.
SOFTWARE PROFESSIONALS:
SOME COMMON CHARACTERISTICS
Based on the survey conducted with software professionals and the
way they were described by senior IIR TECH, project IIR TECH and HR
professionals in software organizations, other employees of the different I.T.
workers and some common characteristics of Indian software professions
have emerged and these characteristics are: o Software professionals invest
substantial time, efforts and resources to acquire relevant and valid
knowledge. Over time the knowledge acquired by them becomes their self-
concept.
Software professionals look forward to use their knowledge and
acquire new knowledge on a continuous basis. This is significant for
software professions to experience a sense of growth and nurture their
concept of growth.
Software Professionals tend to be highly analytical and hence they
expect rationale for every activity. They expect that they should be involved
in defining and planning every organizational change affecting them.
Software professionals tend to be high achievers and hence they
expect periodical and tangible feedback and recognition for performance.
Since reward system is perceived, as a part of the feedback system, linking
performance with reward and experiencing equity in reward becomes very
important issues with them.
Software professionals want to work on new technologies, new
platforms and with new organizations to improve their learning and
curriculum vitae. o Software professionals are more committed to their
profession than the organization they work for.
 Due to existing demand on supply situation, software professionals
are able to move from their existing organizations to new organizations in
India or abroad rather fast.
Software professionals value autonomy, professionalism and
innovativeness.

HISTORY OF THE IIR TECHNOLOGIES

On May 13 at the annual meeting, new representatives of the
shareholders were elected to the Supervisory Board. Previously on May 7,
employee representatives were decided by the employees of Software IIR
TECH.
In April, Software IIR TECH was able to welcome Evalueserve in its
partner ecosystem. In this context Evalueserve is acting as a consultant and
value-added reseller for advice and solutions around the analysis of large
data streams.
In March, Software IIR TECH announced its initiative
"Transformation to the Cloud", which helps companies determine optimal
strategies for cloud adoption and implementation.
 In January, Software IIR TECH and AG Ltd. established a common
streaming analytics solution platform that provides real-time information for
the market of the Internet of Things (IoT).
2014
In October at the annual international customer conference Innovation
World, Software IIR TECH presented the advancement of its BPE product
portfolio and introduced the first Digital Business Platform.
In August, Software IIR TECH announced the expansion of the
Management Board by a new member with global responsibility for sales,
marketing and services.
In the first quarter Software IIR TECH announced the sale of its SAP
consulting business to the Scheer Group GmbH and completed the
transaction on May 31.
At the end of May, Software IIR TECH celebrated its 45th
anniversary. Software IIR TECH is the oldest global software company in
Europe.
In April, Software IIR TECH announced that JackBe, a real-time
visual analytics and intelligence software provider acquired by Software IIR
TECH, was recognized by the Association for Corporate Growth as the
Strategic M&A deal of the Year within the $100M category.
In March at CeBIT, Hanover, Germany, Software IIR TECH unveiled
its Intelligent Business Operations Platform to address the business
challenges posed by the explosive growth in the number of interconnected
personal devices and digital sensors.
In February, Software IIR TECH announced the publication of The
Digital Enterprise: The Moves and Motives of the Digital Leaders, a tour-
de-force introduction to CEO Karl-Heinz Streibich's vision of the impact
digital transformation is having across all industries, supported by more than
20 examples from companies around the globe.
2013
On August 22, Software IIR TECH announced the acquisition of
JackBe Corporation, a privately-held company with headquarters in Chevy
Chase, Maryland (USA) and a provider of real-time visual analytics and
intelligence software.
On June 13, Software IIR TECH announced that it has purchased the
Apama Complex Event Processing Platform of Progress Software. The
platform provides an environment for the design and operation of CEP
applications providing tools and graphical analysis and test capabilities for
analysts, developers and administrators.
On June 3 2013, Software IIR TECH acquired alfabet IIR TECH.
Alfabet is a leading software provider in the areas of "Enterprise
Architecture" and "IT Portfolio Management" focusing on the planning and
optimization of IT landscapes.
In April 2013, Software IIR TECH bought the US cloud platform
provider LongJump. The Platform as a Service offers a range of ready-made
modules and templates for building and running business applications in the
public or private cloud settings.
In March 2013, Software IIR TECH invested in Berlin-based
company metaquark, which is specialized in mobile solutions. The aim is to
jointly develop the webMethods Mobile Suite of Software IIR TECH. This
allowed the company to access especially to the innovative know-how of
metaquark.
2012
 In October, Software IIR TECH unveils a major update to its web
Methods product suite. Extending its fully independent integration layer,
web Methods 9.0 focuses on uniting the management of Big Data from any
source with automated business processes and applications deployed in the
cloud, on mobile devices or in-house.
Also in October, Software IIR TECH launches a major update to its
ARIS product suite, combining new Cloud, Mobile, Social and Analytic
technologies, at its ProcessWorld event in the USA today. ARIS 9.0 focuses
on accelerating process improvement by allowing a significantly broader set
of corporate skills and experiences to contribute to process design and
testing.
In April, Software IIR TECH acquires the company my-Channels
for Universal Messaging Technology. With it, Software IIR TECH
customers have a single, universal messaging middleware platform across
the enterprise, across the cloud and to mobile apps.
In early March at CeBIT, Software IIR TECH announces its strategy
for the in-memory management of Big Data, up to 1,000 times faster than
current technologies.
2011
At the end of the year, Software IIR TECH wins the European
Business Award for its international growth strategy.
In November, Software IIR TECH presents Software IIR TECH
Cloud Ready, the latest solution in the companys cloud strategy.
In late May, Software IIR TECH acquires UK-based Metismo Ltd.,
Hampshire. Metismo provides an extremely flexible and multi-functional
platform for the development of applications and automatic transformation
into different mobile device formats.
 In early May, Software IIR TECH acquires Terracotta Inc., the US
based leader in in-memory and cloud enabling technology. This acquisition
allows Software IIR TECH to provide innovative cloud solutions and
dramatically increase the performance and scalability of its Business Process
Excellence platform. Terracottas in-memory processing will provide the
foundation technology for Software IIR TECHs cloud and Big Data
offerings.
In March at CeBIT, Software IIR TECH presents its new positioning,
which will focus on software and solutions for enterprise business process
management. This cutting-edge concept, based on independent process and
integration platforms, enables businesses to overcome the limitations of
conventional software applications. Software IIR TECH is also
demonstrating its fully integrated product portfolio, for the first time since
its acquisition of IDS Scheer, under the name Enterprise BPM and is
establishing itself as the world's largest provider of this innovative platform
technology. In addition, new products for master data management
(webMethods OneData) and complex event processing (webMethods
BusinessEvents) are being presented at CeBIT.
In February, Software IIR TECH announces its Cloud strategy
Software IIR TECH Cloud Ready. Software IIR TECH fully supports the
vision of extreme collaboration with cloud enabling technology to facilitate
faster change and process improvement with greater participation from all
key stakeholders. Software IIR TECH Cloud Ready includes modeling,
process management, Service-Oriented Architecture (SOA) and cloud
integration offerings. It is designed to bring business and technical
stakeholders together to collaborate on process transformation quickly, and
at a lower cost.
 In February, Software IIR TECH ranked # 7 in Bloomberg
Businessweek's Hot Tech 50, making us one of the worlds fastest growing
technology companies.
In January Software IIR TECH reported that Group revenues in fiscal
year 2010 hit a record high of 1.12 billion (2009: 847.4 million),
exceeding the target set in 2007 and a year earlier than originally planned.
In January Software IIR TECH introduces Process Intelligence for
webMethods BPMS customers. The process intelligence product adds
strategic and tactical capabilities to webMethods BPMS. It includes business
dashboards, historical process discovery, interactive analytics, process
benchmarking, and organizational analysis.
2010
In December the legal integration of Software IIR TECH and IDS
Scheer IIR TECH has been completed with the registration of the merger in
Germany. The fusion of both companies into one legal entity has established
a new global player offering software and services for Business Process
Excellence.
In October Software IIR TECH acquires New Jersey-based Data
Foundations, a leading provider of Master Data Management (MDM)
software. Linking Business Process Management and MDM will reduce
complexity, deliver accurate data and maximize process quality
In September Software IIR TECH delivers a new generation of
Business Mashups with ARIS MashZone 2.0. With the Enterprise Edition,
the product addresses large companies as well.
In August Software IIR TECH is named a Leader in Business Process
Management Suites by the independent research form Forrester Research,
Inc. Software IIR TECH receives its top scores in services as well as process
modeling and collaborative design
In August the Software IIR TECH Supervisory Board establishes a
new company governing body: the Group Executive Board (GEB). The GEB
consists of four members from the current Management board plus four
divisional directors representing the operational Management areas.
In July IDS Scheer IIR TECHs annual general meeting approved the
merger Agreement with Software IIR TECH by a majority of 92,03 % of the
share capital on July 8, 2010. This is another important step in the
integration of Software IIR TECH and IDS Scheer IIR TECH.
In June Software IIR TECH and IDS Scheer demonstrate how
business process excellence technology helps organizations to return to
economic growth at ProcessWorld in Berlin. Over 800 participants from
around the globe attend.
In May Software IIR TECH is ranked as leader in delivering service-
oriented architecture (SOA) Governance technologies to the marketplace by
Gartner, Inc., a leading industry analyst firm. The ranking, based on total
software revenue in 2009, represents the second consecutive year in which
Software IIR TECH is listed as the global market leader in SOA
Governance.
In March ARISalign, the first joint product of Software IIR TECH and
IDS Scheer, is presented at CeBIT 2010.
In February Software IIR TECH announces that it has registered the
domination and profit transfer Agreement between SIIR TECH Beteiligungs
GmbH and IDS Scheer on the commercial register at the Saarbrucken
District Court. As a result of the registration, the integration of the
operational processes of both begins. The two companies are under common
leadership.
In February Software IIR TECH announces general availability of
webMethods 8, the latest release of Software IIR TECHs flagship
webMethods platform.
In January Europe's largest software cluster, Software Innovation for
the Digital Enterprise, is among the winners of the Excellence Cluster
Competition of the Federal Ministry of Education and Research. This cluster
is considered the Silicon Valley of Europe, spanning centers located in
Darmstadt, Kaiserslautern, Karlsruhe, Saarbrcken and Walldorf. Software
IIR TECH is part of it.
2009
The document for a voluntary public tender offer made to
shareholders of IDS Scheer IIR TECH is published on August 17th.
Software IIR TECH tenders 15 per share in cash.
Software IIR TECH announces its takeover offer for IDS Scheer IIR
TECH on July 13th. The strengths of Software IIR TECH: technology
leadership in middleware software, financial strength and a global presence
will complement IDS Scheers strengths: the modelling, implementation and
controlling of business processes, a strong partner network and a large
service presence in their approx. 7,500 customer base.
At the beginning of July, Software IIR TECH acquires Teconomic IIR
TECH in an all cash deal. Based in Freienbach, near Zrich, Switzerland,
Teconomic provides comprehensive IT consulting services and solutions to
the European financial sector focusing on SWIFT Services.
In June, Software IIR TECH announces the latest release of its
flagship webMethods platform, webMethods 8.0. The release enhances the
ability of companies to capitalize on both open architecture and existing
infrastructure investments, reduces the time and cost to improve processes
and integrate systems, and enables dramatic end-user productivity through
tighter collaboration between IT and the business.
Software IIR TECH celebrates its 40th anniversary on May 30th. The
company was founded in 1969 in Darmstadt as Europes first software
company. The company is entering its fifth decade of developing innovative
technology as independent market leader in business process software.
With its new product, AlignSpace, Software IIR TECH creates the
largest social network of BPM professionals. The new product is a platform
that offers collaboration between all project participants in a Business
Process environment. Data, documents and services produced within this
environment are made available and reusable within or across company
borders. Leading social networks can also be easily plugged-in.
Software IIR TECH takes a 51 percent shareholding in Leipzig-based
software company itCampus, as of April 1, 2009. By joining forces with
itCampus, Software IIR TECH expands its German research and
development capacity in the realm of process automation.
Software IIR TECH appoints Ivo Totev to the Executive Board with
responsibility for Professional Services worldwide.
2008
Various independent market research firms have designated Software
IIR TECH a leader in the SOA
and BPM sectors, demonstrating the successful integration of the
webMethods product line into the overall product portfolio.
The acquisition of Jacada (Israel) strengthens Software IIR TECHs
position in the application modernization market: Jacada counts more than
200 customers in the integration business. Furthermore, the acquisition
expands Software IIR TECHs product portfolio with additional products for
modernizing the user interfaces of applications that run on mainframes and
medium-sized computers.
Software IIR TECH is strengthening its Professional Services in
response to an increased demand for consulting services relating to strategic
SOA and BPM projectscreating a new position for professional services
on the board, occupied by the distinguished Holger Friedrich.
In April, Software IIR TECH pays shareholders dividends of 1.00
per share.
2007
Software IIR TECH successfully acquires webMethods, Inc.
(NASDAQ: WEBM) a leading business integration and optimization
software company. With a deal value of $546 million, this merger was one
of the largest pure software deals in the history of the European IT industry.
The combination creates a new global leader in business infrastructure
software with over 4,000 enterprise customers worldwide and is one of the
largest independent vendors in the rapidly growing Service-Oriented
Architecture (SOA) and Business Process Management (BPM) markets.
Again Software IIR TECH achieves best financial results in the
companys history: Operating revenues improve by 36% (at constant
currency rates), Licensing revenues grow by 53% (at constant currency
rates), EBIT rises by 23%, Free cash flow increases by 46%, EBIT margin
guidance for 2008 revised upward to 24%.
2006
Software IIR TECH announces Adabas 2006 and Natural 2006. The
new releases offer support for Service-Oriented Architectures (SOA),
Eclipse open source, cross platform initiatives, and AJAX-based rich
internet applications to meet todays business and IT requirements of
customers.
Launch of crossvision the new suite for SOA in February 2006.
In May Software IIR TECH pays a dividend of 0.80 per share.
Expansion in high-growth Latin America with a new office in Sao
Paulo, major projects in Brazil, Chile and Panama, and an IT Training
Center Chile.
Software IIR TECH and Fujitsu earn Intelligent Enterprise
Magazines Editors' Choice Award for SOA and BPM Solutions - SOA,
ESB, BPM products and expertise makes the Software IIR TECH and
Fujitsu partnership a "Global Force in BPM".
Launch of the CentraSite Community: the first standards-based SOA
Forum Partner Alliance and interactive forum unite independent software
vendors and system integrators to deliver interoperable SOA solutions to
customers.
Expansion in Japan: in December Software IIR TECH officially opens
its office in Tokyo. The new office will directly serve the companys well
established Japanese customer base of over two hundred enterprises.
The best financial results in company history: for fiscal 2006,
Software IIR TECH reports revenue growth of 10% to 483.0 million. At
constant currency rates, this represents an 11% rise and exceeds the
companys target. In the same period, EBIT increased by 15% to 111.2
million.
2005
 With total revenues of 438 million and an operating income of
96.4 million Software IIR TECH reported record operating results for fiscal
2005.
Driven by the positive earnings trend Software IIR TECH paid a
dividend of 0.75 Euro for the business year 2004 - the first dividend since
2002.
Software IIR TECH formed strategic alliances with Fujitsu as well as
IDS Scheer. Together with Fujitsu the company delivered a joint integration
offering for Service Oriented Architecture (SOA). With IDS Scheer
Software IIR TECH widened their SOA product portfolio to include the
design and monitoring of business processes.
Software IIR TECH released certified adapters for the integration of
mainframes into the SAP R3 and Netweaver landscape. The company
became a service partner of SAP Germany.
By acquiring the software specialists Sabratec (modernisation of
mainframes) and Casabac (development software for enterprise wide web
applications) Software IIR TECH further enhanced its XMLi-portfolio. The
organic growth of Software IIR TECH is strengthened by the acquisitions of
technology and sales competence: through the acquisition of APS Venezuela
and five sister companies in Panama, Costa Rica and Puerto Rico the
company further expanded its market presence in Central America and the
Caribbean.
2004
Software IIR TECH celebrates two anniversaries in 2004: the 35th
year since its foundation and the 5th year since its stock market quotation.
2003
 In a strategic realignment implemented in 2003, Software IIR TECH
focuses its development work and offering on the ETS and XML Business
Integration business lines.
In conjunction with iGATE, Software IIR TECH establishes Software
IIR TECH India in the Indian city of Pune. Software IIR TECH has a
majority share in the new company.
In October Karl-Heinz Streibich becomes the new CEO.
The executive board is given an international focus in spring 2003
with three new regional board members.
Software IIR TECH is listed on the TecDAX index at the beginning of
the year.
2002
Dr. Erwin Knigs steps down from the executive board. Karl Heinz
Achinger, deputy chairman of the Supervisory Board, takes over as CEO on
an interim basis.
German President Johannes Rau presents Peter Schnell with the Gold
Medal of the Federal Association of Foundations in Germany for his
foundation work. The Software IIR TECH Foundation is one of Germanys
ten largest foundations and disburses financial support amounting to around
25 million euro annually.
Software IIR TECH announces record sales of over 588 million euro
for 2001.
2001
Software IIR TECH continues to develop its products: Natural 5 for
Windows can process XML documents and access the Web directly via
HTTP; development of EntireX results in a complete solution for integration
of platforms and applications within and between organizations, and
enhancements to Tamino XML Server makes it easier for users to handle
XML data. Tamino XML Servers open architecture guarantees customers
smooth linkage to and communication with existing IT infrastructure.
Takeover of SIIR TECHA Systems, Inc., USA. After the takeover,
around 35% of Software IIR TECH sales are accounted for by the American
market.
2000
At the end of the year, Software IIR TECH introduces the Tamino
XML Platform the worlds first product platform entirely based on XML.
The arrival of the new millennium presents no problems for Software
IIR TECH or its customers.
1999
Software IIR TECH is listed on the Frankfurt stock exchange on April
26 in what was at the time the worlds biggest ever software industry IPO.
The total issue volume is over DM 850 million. After only 6 months,
Software IIR TECHs shares are included in the MDAX stock index.
At CeBIT, Software IIR TECH unveils its Tamino Information Server
to the general public for the first time. Tamino is a completely new
information server for the Internet comprising a database system based on
the new Web standard XML (eXtensible Markup Language). Tamino is
especially designed for the storage, Management and transfer of structured
and unstructured data.
1998
Software IIR TECH introduces Bolero, a software platform based on
Java technology.
1997
 The investment firm Thayers Capital acquires all the shares of
Software IIR TECH North America, which subsequently trades under the
name SIIR TECH Americas (SIIR TECHA).
Software IIR TECH and SAP IIR TECH jointly establish the
subsidiary SAP Systems Integration GmbH in Alsbach-Hhnlein near
Darmstadt, in which Software IIR TECH has a 40% interest. SAP SI focuses
on introducing the SAP R/3 application system in selected market segments.
EntireX is introduced. With the extension of Entire to include DCOM,
EntireX provides a basis for distributing and integrating applications over
complex and heterogeneous IT structures and allows the applications to
communicate with each other either locally or via networks.
In a technology partnership with Microsoft, Software IIR TECH ports
DCOM (Distributed Component Object Model) to the main computer
platforms available on the commercial market. Microsoft introduced DCOM
as a component of Windows NT and it has become the industry standard
alongside CORBA (Common Object Request Broker Architecture). Since
Windows NT is being installed on more and more computers, the integration
of the Microsoft technology with existing applications on mainframes and
UNIX systems becomes ever more important.
1996
Company founder Peter Schnell hands over company Management to
Dr. Erwin Knigs in order to devote himself fully to Foundation
development work.
1994
After negotiations with Siemens Nixdorf IIR TECH, Software IIR
TECH takes over SQL-Datenbanksysteme GmbH in Berlin, so gaining full
access to the Adabas D technology.
 Software IIR TECH opens an office in Moscow and establishes a
subsidiary in Taipei, Taiwan.
1992
First Eastern Europe subsidiary is founded in Prague.
Announcement of cooperation with SAP IIR TECH. This
collaboration opens up new opportunities for solutions: the SQL-DB
database system gives users of SAPs R/3 application system a more
efficient and cost-effective solution.
Launch of Entire integration tools. Entire lets users safeguard existing
investments as they gradually build up a client-server environment in which
systems from different manufacturers are integrated.
COMPANY PROFILE:
Integrated Intelligent Research (IIR) is center for research
empowerment to disseminate and innovative research activities in the field
of Computer Science Application and engineering. The research activities
attempts to integrate the applied domain Knowledge of next generation
computing through sustain research identification, execution of project and
share the knowledge via publications with the peer and targeted group
which has similar interest. As part of the research work we are interested to
publish the journals for knowledge sharing process.

The technology leads the world today to provide the entire environment for
human lifestyle. All applications and the devices are invented by the
research community. India is one among the major contributors to the
science and technology. The research works are mostly initiated at the
academic institution such as universities, colleges and few private sector
institutions. As per the government initiatives and 12th five year plan, it
invites private and interested groups to involve in contribution of
technology innovation through scientific research activities. Inline to the
government vision and need of social and regional demand, Integrated
Intelligent Research was established in the year 2006 and registered with
State Government of Tamilnadu on Feb 2012.
With organizations going digital today, there is a strong need to develop and
maintain a feature rich website which provides users with a gratifying
experience. A good website enhances an organizations web presence and
helps in effective communication with users.
 DRC Systems offers complete web technology services to clients for all
their portal needs our team comprises of Internet marketing specialists,
content developers, graphic designers and coders. Our web developers
bring several years of experience in creating web applications that fulfill
customers technical and business requirements. Our creative team builds
tailored web solutions that accomplish customers business objectives and
goals.

We at DRC Systems can help you building a new website from scratch or
help you improve your existing one in order to increase user traffic and
conversion. Whether you want to develop a successful e-commerce site or
establish an online presence, DRC Systems can assist you in achieving
your goals by developing simple static sites to top-notch interactive sites.
We use latest technologies to design and deliver cutting edge web
solutions that help increase sales and maximize revenue.

History of IT sector in India before 1991

In 1965, immigration laws in USA were modified and the restrictions on

immigrants were reduced considerably. As a result a lot of Indian
professionals migrated for research opportunities in USA. The IT
revolution in USA and the much fancied Silicon Valley in the US during
the 80s and 90s could not have been possible without the work of these
migrated Indians. What this migration did for the Indian IT industry was
creating innumerable opportunities in the USA in the IT sector. Due to the
fast growing IT sector in USA, there was a need for IT professionals outside
USA. India had a huge number of educated people and the education in
India being in English, there was a large population of English speaking
technically strong people in India. Hence outsourcing of work started
gaining momentum and this led to the huge boom in the IT sector in India,
whose most of the work is exporting software and software services to the
US and other overseas clients.

Integrated Intelligent Research (IIR)was started by the IIR group for

software development services in India in 1968. IIR started the software
services by developing punched card facilities for IIR employees. The first
overseas client for IIR was Burroughs Corporation, United States. The job of
IIR was to write software code for the Burroughs machines in 1974. With
word of mouth, IIR grabbed a number of projects, small and big during the
following years and today IIR is India's top IT company with a turnover of
more than $10 billion. In 1966, Azim Premji became the chairmen of the
large company WIPRO and the focus of WIPRO was concentrated on the IT
services sector.
IIR TECH Computer Systems started developing software and providing
services since the beginning of the company in 1972 (At that time it was
named Data Conversion Inc). In 1981, Infosys was founded by Narayan
Murthy and his colleagues. Infosys was completely committed towards
providing quality software services and also developed an IT business model
which was later followed by most of the IT companies in India.

The Indian economy during this period was completely controlled by the
Indian Government and there were strict restrictions and regulations for
private business entities in India. Hence there was no major growth in the
IT sector in India till 1991.
Economic reforms in 1991 and development of IT sector in India

The Indian government had strict control over the private business entities in
India before liberalisation of economy in 1991. Moreover, the wide area
networks and internet lines were completely controlled by the central
government. As a result, the Indian IT sector was totally held back due to
these restraints on the functioning of the software services providers.

The first major IT reform by the Indian Government was the creation of
corporation called Software Technology Parks of India (STPI). This
corporation provided satellite links to major IT developers enabling them to
transmit the work done in India directly abroad. This reduced the costs
incurred to the Indian IT companies as well as helped the clients in US trust
Indian industries and go for outsourcing. Finance minister, Dr. Manmohan
Singh, introduced the major economic reforms in 1991 to solve the debt
problem created during that time. As per these economic reforms the
internation integration became possible. The huge restrictions on overseas
business were lifted and foreign investments were welcomed. As a result, the
IT industry in India became free and the business of outsourcing would
finally gain momentum with more and more clients and enterprises going for
outsourcing of IT. Also, the inception of Windows and other user friendly
operating services made the PC experience even more simple and less time
consuming. Coupled with development of high level programming
languages like Basic, C and others, the Indian IT brains had the perfect
platform to rise in the global arena. The Indian IT sector boomed and
growed at gain of nearly 50% every year.

Another major event for Indian IT industry post the 1991 reforms was the
Y2K bug. Fear of a complete breakdown of computer services, the US
corporations outsourced all the equipment and upgrading work to Indians.
The task of rectifying the Y2K bug was thrown to the Indians and as a result
the modification of all the codes and softwares, which were initially
designed till a date of 1999 was to be edited and huge work was outsourced
to the Indian IT industries. The Indian IT industry has helped provide a
national GDP of more than 6% since these economic reforms took place 20
years ago and today, India is known as the IT hub of the world.

National Task Force, NTP and IT Act, 2000 helped IT sector grow in
India

The NDA(National Democratic Alliance) government, under the leadership

of prime minister Atal Bihari Vajpayee, included the development of IT as
the top priority in their long term agenda. Indian National Task Force was
formed for this purpose which overtook the development of IT services in
large and small IT enterprises in India. The National Task Force, within 3
months, provided a detailed report on the Indian IT and technological
industries with more than 100 recommendations which would help improve
the IT services in India.
A swift action plan by the Central Government towards IT services growth
was executed and all the recommendations were acted upon sooner than
later. The result of these efforts from the Indian Government bore fruit with
the IT exports touching more than $50 billion. Indian economy was no
longer that of a developing nation, but at par with those of the developed
nations in the world.

The New Telecommunications Policy, 1999 (NTP 1999) helped free the
telecommunications sector in India. This helped availability of the
infrastructure for the telecommunication. The satellites, towers and other
telecom related businesses were no longer owned by the Central
Government. The entry of private sector in these departments helped the
telecom sector grow rapidly resulting the boom in IT sector in
India eventually. The growth of IT is totally dependent on the innovation
and development of telecom industry. The Information Technology Act
2000 provided legal recognition of the electronic documents, digital
signatures, offences and contraventions. This helped a long way in striking
deals with US clients as no longer the person to person meeting was required
for finalisation of business deals.

Salary details of professionals in IT industries in India

There is a huge hype regarding the salaries of IT professionals in India. One

may hear a salary as low as Rs. 2500 per month to a salary as high as Rs. 1
lakh per month for software professionals. Hence there is no way there can
be a generalization of the salaries of the IT professionals. The salaries are
dependent on the skills of the professionals, qualification of the employees
and the experience of the employees.
I have enlisted average salaries of IT professionals based on the experience
and designation. This list cannot be taken as the standard salary packages for
IT professionals an the information cannot be used to demand equivalent
salaries from IT employers. It is just an average estimate of the salaries only
for comparison purpose.
Information Technology (IT) industry in India is one of the fastest
growing industries. Indian IT industry has built up valuable brand equity for
itself in the global markets. IT industry in India comprises of software
industry and information technology enabled services (ITES), which also
includes business process outsourcing (BPO) industry. India is considered as
a pioneer in software development and a favorite destination for IT-enabled
services.

The origin of IT industry in India can be traced to 1974, when the mainframe
manufacturer, Burroughs, asked its India sales agent, Tata Consultancy
Services (IIR), to export programmers for installing system software for a
U.S. client. The IT industry originated under unfavorable conditions. Local
markets were absent and government policy toward private enterprise was
hostile. The industry was begun by Bombay-based conglomerates which
entered the business by supplying programmers to global IT firms located
overseas.

During that time Indian economy was state-controlled and the state remained
hostile to the software industry through the 1970s. Import tariffs were high
(135% on hardware and 100% on software) and software was not considered
an "industry", so that exporters were ineligible for bank finance.
Government policy towards IT sector changed when Rajiv Gandhi
became Prime Minister in 1984. His New Computer Policy (NCP-1984)
consisted of a package of reduced import tariffs on hardware and software
(reduced to 60%), recognition of software exports as a "delicensed industry",
i.e., henceforth eligible for bank finance and freed from license-permit raj,
permission for foreign firms to set up wholly-owned, export-dedicated units
and a project to set up a chain of software parks that would offer
infrastructure at below-market costs. These policies laid the foundation for
the development of a world-class IT industry in India.

Today, Indian IT companies such as Tata Consultancy Services (IIR),

Wipro, Infosys, HCL et al are renowned in the global market for their IT
prowess. Some of the major factors which played a key role in India's
emergence as key global IT player are:
Indian Education System
The Indian education system places strong emphasis on mathematics
and science, resulting in a large number of science and engineering
graduates. Mastery over quantitative concepts coupled with English
proficiency has resulted in a skill set that has enabled India to reap the
benefits of the current international demand for IT.

High Quality Human Resource

Indian programmers are known for their strong technical and
analytical skills and their willingness to accommodate clients. India also has
one of the largest pools of English-speaking professionals.

Competitive Costs
The cost of software development and other services in India is very
competitive as compared to the West.
Infrastructure Scenario
Indian IT industry has also gained immensely from the availability of
a robust infrastructure (telecom, power and roads) in the country.
In the last few years Indian IT industry has seen tremendous growth.
Destinations such as Bangalore, Hyderabad and Gurgaon have evolved into
global IT hubs. Several IT parks have come up at Bangalore, Hyderabad,
Chennai, Pune, Gurgaon etc. These parks offer Silicon Valley type
infrastructure. In the light of all the factors that have added to the strength of
Indian IT industry, it seems that Indian success story is all set to continue.
 CHAPTER III
REVIEW OF LITERATURE

REVIEW OF LITERATURE

Working capital management involves the relationship between a

firm's short-term assets and its short-term liabilities. The goal of working
capital management is to ensure that a firm is able to continue its operations
and that it has sufficient ability to satisfy both maturing short-term debt and
upcoming operational expenses. The management of working capital
involves managing inventories.
Decisions relating to working capital and short term financing are
referred to as working capital management. These involve managing the
relationship between a firm's short-term assets and its short-term liabilities.
The goal of Working capital management is to ensure that the firm is able to
continue its operations and that it has sufficient cash flow to satisfy both
maturing short-term debt and upcoming operational expenses.
By definition, Working capital management entails short term
decisions - generally, relating to the next one year period - which is
"reversible". These decisions are therefore not taken on the same basis as
Capital Investment Decisions (NPV or related, as above) rather they will be
based on cash flows and / or profitability.
 The importance of cash flow is not new to the finance literature. Over
twenty years ago, Largay and Stickney (1980) reported that the then-recent
bankruptcy of W.T. Grant, a nationwide chain of department stores, should
have been anticipated because the corporation had been running a deficit
cash flow from operations for 8 of the last 10 years of its corporate life. As
part of a study of the Fortune 509s financial management practices, Gilbert
and Reichert (1995) find that time value of money cash flow analysis is used
to select projects in 91 percent of the firms. Accounts receivable
management models are used in 59 percent of these firms, while inventory
management models were used in 60 percent of the companies.
Recently, Farragher, Kleiman and Sahu (21129) find that 55 percent
of firms in the S&P Industrial index complete some form of a cash flow
assessment, but did not present insights regarding accounts receivable and
inventory management, or variations of any current account asset or liability
accounts across industries.
Theoretical determination of optimal trade credit limits are the subject
of many articles over the years (e.g., Schwartz, 1974 and scherr, 1996), with
scant attention paid to actual accounts receivable management.

Across a limited sample, weinraub and visscher (1998) observe a

tendency of firms with low levels of current ratios to also have low levels of
current liabilities. Combining accounts receivable and payable into one issue
is hill, satoris, and fergusons (1984) finding that payees define date of
payment as the date payment is received, while payors view payment as the
postmark date. Additional WCM insight across firms, industries, and time is
needed! maness and zietlow (2101, pp. 51, 496) presents two models of
value creation through effective short-term financial management activities.
 However, these models are generic models and do not consider unique
firm or industry influences. maness and zietlow discuss industry influences
in a short paragraph that includes the observation that an industry a
company is located in may have more influence on that companys fortunes
that overall gnp (2101, p. 507). In fact, a careful review of this 627-page
textbook finds only sporadic information on actual firm levels of WCM
dimensions, virtually nothing on industry factors except for some boxed
items with titles such as should a retailer offer an in-house credit card (p.
128), and nothing on WCM stability over time. This research will attempt to
fill in this void space.
How are the readings connected? If there any other text out there
besides the one in the last paragraph. The first annual cfoworking capital
survey, a joint project with rel consultancy group, was published in the june
1997 issue of cfo. rel is a london, england-based management consulting
firm specializing in working capital issues for its global list of clients. The
original survey reports several working capital benchmarks for public
companies using data for 1996. Each company is ranked against its peers
and also against the entire field of 1090 companies. rel continues to update
the original information on an annual basis. The industries that include at
least 8 companies over the 2010-2012 periods are listed below. Deleted:
represented.
 CHAPTER IV
DATA ANALYSIS AND INTERPRETATION

DEFINITION OF WORKING CAPITAL

The term working capital refers to the amount of capital which is readily
available to an organization. That is, working capital is the difference
between resources in cash or readily convertible into cash (Current Assets)
and organizational commitments for which cash will soon be required
(Current Liabilities).

Current Assets are resources which are in cash or will soon be converted into
cash in "the ordinary course of business".

Current Liabilities are commitments which will soon require cash settlement
in "the ordinary course of business".

WORKING CAPITAL = CURRENT ASSETS - CURRENT

LIABILITIES

In a department's Statement of Financial Position, these components

of working capital are reported under the following headings:
CURRENT ASSETS:

Liquid Assets (cash and bank deposits)

Inventory
Debtors and Receivables

CURRENT LIABILITIES:

Bank Overdraft
Creditors and Payables
Other Short Term Liabilities

APPROACHES TO WORKING CAPITAL MANAGEMENT

The objective of working capital management is to maintain the

optimum balance of each of the working capital components. This includes
making sure that funds are held as cash in bank deposits for as long as and in
the largest amounts possible, thereby maximizing the interest earned.
However, such cash may more appropriately be "invested" in other assets or
in reducing other liabilities.

Working capital management takes place on two levels:

Ratio analysis can be used to monitor overall trends in working capital

and to identify areas requiring closer management.
The individual components of working capital can be effectively
managed by using various techniques and strategies.
 When considering these techniques and strategies, departments need to
recognize that each department has a unique mix of working capital
components. The emphasis that needs to be placed on each component
varies according to department. For example, some departments have
significant inventory levels; others have little if any inventory.

Furthermore, working capital management is not an end in itself. It is an

integral part of the department's overall management. The needs of efficient
working capital management must be considered in relation to other aspects
of the department's financial and non-financial performance.

Financial ratio analysis calculates and compares various ratios of amounts

and balances taken from the financial statements.

The main purposes of working capital ratio analysis are:

To indicate working capital management performance; and

To assist in identifying areas requiring closer management.

Three key points need to be taken into account when analyzing financial
ratios:

The results are based on highly summarized information.

Consequently, situations which require control might not be apparent,
or situations which do not warrant significant effort might be
unnecessarily highlighted;
Different departments face very different situations. Comparisons
between them, or with global "ideal" ratio values, can be misleading;
 Ratio analysis is somewhat one-sided; favorable results mean little,
whereas unfavorable results are usually significant.

However, financial ratio analysis is valuable because it raises questions

and indicates directions for more detailed investigation.

The following ratios are of interest to those managing working capital:

Working Capital Ratio;

Liquid Interval Measure;
Stock Turnover;
Debtors Ratio;
Creditors Ratio.

WORKING CAPITAL RATIO

Current Assets

Current Liabilities

The working capital ratio (or current ratio) attempts to measure the
level of liquidity, that is, the level of safety provided by the excess of current
assets over current liabilities.

The "quick ratio" a derivative, excludes inventories from the current

assets, considering only those assets most swiftly realizable. There are also
other possible refinements.

There is no particular benchmark value or range that can be

recommended as suitable for all government departments. However, if a
department tracks its own working capital ratio over a period of time, the
trends-the way in which the liquidity is changing-will become apparent.

LIQUID INTERVAL RATIO

Liquid Assets

Average Operating Expenses

This is another measure of liquidity. It looks at the number of days

that liquid assets (for example, inventory) could service daily operating
expenses (including salaries).

STOCK TURNOVER RATIO

Cost of Sales

Average Stock Level

This ratio applies only to finished goods. It indicates the speed with
which inventory is sold-or, to look at it from the other angle, how long
inventory items remain on the shelves. It can be used for the inventory
balance as a whole, for classes of inventory, or for individual inventory
items.

The figure produced by the stock turnover ratio is not important in

itself, but the trend over time is a good indicator of the validity of changes in
inventory policies.
 In general, a higher turnover ratio indicates that a lower level of
investment is required to serve the department.

Most departments do not hold significant inventories of finished

goods, so this ratio will have only limited relevance.

DEBTOR RATIO

There is a close relationship between debtors and credit sales to third

parties (that is, sales other than to the Crown). If sales increase, debtors will
increase, and conversely, if sales decrease debtors will decrease.

The best way to explain this relationship is to express it as the number

of days that credit sales are carried on the books:Where trading terms are 30
days net cash, and customers buy from

Credit sales per period x days per

Average Debtors

Day-to-day during the 30 day period and pay 30 days after a statement
is rendered, a collection period of 45 days (the average between 30 and 60
days) would be satisfactory.

If the average collection period extends beyond 60 days, debtors are

holding cash that should have flowed into the department. This means that
the department is unable to satisfy pressing liabilities or to invest that cash.
 The debtor ratio does not solve the collection problem, but it acts as
an indicator that an adverse trend is developing. Remedial action can then be
instigated.

CREDITOR RATIO

This ratio is much the same as the debtor ratio. It expresses the
relationship between credit purchases and the liability to creditors. It can be
stated as the number of days that credit purchases are carried on the books.

Credit purchase per period x days per period

Average Creditors

LIQUIDITY OF WORKING CAPITAL:

The liquidity position of a firm is largely affected by the liquidity of
its working capital. The appropriate tests of this important feature of
working capital analysis are analyzed below.
 5.1CURRENT RATIO

Current assets Current liabilities Ratio

YEAR
( times )
2011-2012 1259369408 221154699 5.69
2012-2013 1607087538 184830664 8.69
2013-2014 857669926 121307697 7.12
2014-2015 1135662118 112919857 10.14
2015-2016 1139098939 220779845 4.75

Inference:
This ratio is an indicator of the firms commitment to meet its short-
term liabilities. The company has not had adequate current assets. An ideal
current ratio 2 is considered as a safe margin of solvency due to the fact that
if the current assets are reduced to half (i.e.) instead of 2 then also the
creditors will able to get their payments in full. However a business having
seasonal trading activity may show a lower current ratio at a certain period
of the year. A very high current ratio is also not desirable since it means
efficient use of funds. The company is not desirable in efficient use of
funds.
Chart 5.1 Current Ratio

Chart Title

12

10
2011-2012
8 2012-2013
2013-2014
6
2014-2015
4 2015-2016

5.2WORKING CAPITAL TURNOVER RATIO

WORKING RATIO
YEAR SALES CAPITAL ( Times )
(Rupees) (Rupees)
2011-2012 98492557 1128214709 0.09
2012-2013 136214101 241219109 0.56
2013-2014 148087677 1084194229 0.14
2014-2015 121535360 1112742261 0.12
 2015-2016 85410661 828319091 0.10

Inference:
This ratio indicates whether working capital has been effectively
utilized in making sales or not.
From the table it is noted that working capital had some fluctuation in
the middle of the study period, yet the company was able to increase it in the
later years.
Hence the turnover indicates that company had utilized its working
capital efficiently and the company can also try to work on this to get more
effective values.

Chart 5.2 WORKING CAPITAL TURNOVER RATIOS

 12
10.05
10
8.69
8 7.12
5.69
6
4.75
4

5.3 INVENTORIES TO CURRENT ASSETS

CURRENT RATIO
YEAR INVENTORIES ASSETS ( Times )
(Rupees) (Rupees)
2011-2012 443218275 1259369408 0.35
2012-2013 4565366544 1607087538 0.28
2013-2014 493646982 857669926 0.41
2014-2015 478946594 1135662118 0.42
2015-2016 453879119 1139098939 0.43

Inference:
 From the table it is known that the inventories to current assets ratio
also register a fluctuating trend during the entire study period.
The average ratio is 0.41 times and thus it is found that the investment
in inventories is kept at the considerable level.

Chart 5.3 INVENTORIES TO CURRENT ASSETS

0.45

0.4

0.35

0.3

0.25

0.2

0.15

0.1

0.05

0
5.4 CASH TO CURRENT ASSETS RATIO

CURRENT RATIO
YEAR CASH ASSETS ( Times )
(Rupees) (Rupees)
2011-2012 472165527 1259369408 0.37
2012-2013 357614655 1607087538 0.22
2013-2014 521248923 857669926 0.43
2014-2015 306643076 1135662118 0.27
2015-2016 241319457 1139098939 0.23

Inference:
From the table shows the details of cash to current assets ratio and
registered a fluctuating trend throughout the study period from 21129 to
2094.
The average cash to current assets is maintained at proper times.
Hence we find that company had moderate level of cash in proportion to
current assets.
Chart 5.4 CASH TO CURRENT ASSETS RATIO

0.45 0.43

0.4
0.37
0.35

0.3
0.27 2011-2012

0.25 0.23 2012-2013

0.22
2013-2014
0.2 2014-2015
2015-2016
0.15

0.1

0.05

5.5 CASH TO WORKING CAPITAL RATIO

WORKING RATIO
YEAR CASH CAPITAL ( Times )
(Rupees) (Rupees)
2011-2012 472165527 1128214709 0.45
2012-2013 357614655 241219109 0.15
2013-2014 521248923 1084194229 0.48
2014-2015 306643076 1112742261 0.29
2015-2016 241319457 828319091 0.29
Inference:
The cash to working capital ratio registered a fluctuating trend during
the study period this is noted from the table.
The average ratio of cash to working capital is balanced. Hence it is
found that the working capital ratio is managed by using the cash & bank
balance available in the company.

Chart 5.5 CASH TO WORKING CAPITAL RATIO

0.5 0.48
0.45
0.45
0.4
0.35 2011-2012
0.29 0.29 2012-2013
0.3
0.25 2013-2014
0.2 0.15 2014-2015
0.15 2015-2016
0.1
0.05
0
5.6 CASH TO SALES RATIO

RATIO
YEAR CASH SALES ( Times )
(Rupees) (Rupees)
2011-2012 472165527 98492557 4.79
2012-2013 357614655 136214101 2.62
2013-2014 521248923 148087677 3.52
2014-2015 306643076 121535360 2.52
2015-2016 241319457 85410661 2.82

Inference:
This is one of the important ratios of controlling cash. A study of cash
to sales ratio will provide a deep insight into the cash balance held in the
concerns.
Evident from the table shows cash to sales registered a fluctuating
trend throughout the study period.
Chart 5.6 CASH TO SALES RATIO

5 4.79
4.5
4 3.52
3.5 2011-2012
3 2.82 2012-2013
2.62 2.52
2.5 2013-2014
2 2014-2015
1.5 2015-2016
1
0.5
0

5.7 CASH RATIO

CURRENT RATIO
YEAR CASH LIABILITIES ( Times )
(Rupees) (Rupees)
2011-2012 472165527 221154699 2.14
2012-2013 357614655 184830664 1.93
2013-2014 521248923 121307697 4.33
 2014-2015 306643076 112919857 2.71
2015-2016 241319457 220779845 10.9

Inference:
From the table it is noted that the cash position of the company is
satisfactory as the average ratio.
It is found that the cash required to meet out the current liabilities is
maintained at a normal level hence its shows that company follows an
average policy.

Chart 5.7 CASH RATIO

12 10.9
10
2011-2012
8
2012-2013
6 2013-2014
4.33 2014-2015
4
2.71 2015-2016
2.14 1.93
2

0
 CURRENT FIXED RATIO
YEAR ASSETS ASSETS ( Times )
(Rupees) (Rupees)
5.8
2011-2012 1259369408 445335336 2.83
2012-2013 1607087538 445335336 3.61
2013-2014 857669926 298717767 4.12
2014-2015 1135662118 477487671 2.20
2015-2016 1139098939 468492769 2.42

CURRENT ASSETS TO FIXED ASSETS RATIO

Inference:
The level of current assets can be measured by using this current asset
to fixed assets ratio.
 From the table it is noted that the ratio is between the average ratio
and this indicates the company had a moderate current asset policy
throughout the study period.

Chart 5.8 CURRENT ASSETS TO FIXED ASSETS RATIO

4.5
4.03
4 3.61
3.5
2.83 2011-2012
3
2.42 2012-2013
2.5 2.2
2013-2014
2
2014-2015
1.5
2015-2016
1
0.5
0

5.9 CURRENT ASSETS TO TOTAL ASSETS RATIO

 CURRENT TOTAL RATIO
YEAR ASSETS ASSETS ( Times )
(Rupees) (Rupees)
2011-2012 1259369408 1941885379 0.65
2012-20123 1607087538 1838866594 0.87
2013-2014 857669926 1878097191 0.64
2014-2015 1135662118 1799527219 0.63
2015-2016 1139098939 1711356114 0.61

Inference:
From the table shows the current assets to total assets ratio of the
company, which registered a fluctuating trend throughout the study period.
This ratio implies that company is maintaining a considerable level of
current assets in proportion to total assets.

Chart 5.9 CURRENT ASSETS TO TOTAL ASSETS RATIO

0.9 0.87

0.8
0.7 0.65 0.64 0.63 0.61
2011-2012
0.6
2012-2013
0.5
2013-2014
0.4
2014-2015
0.3
2015-2016
0.2
0.1
0

5.10 WORKING CAPITAL RATIO

WORKING CURRENT RATIO

YEAR CAPITAL ASSETS ( Times )
(Rupees) (Rupees)
2011-2012 1128214709 1259369408 0.82
2012-2013 241219109 1607087538 0.15
2013-2014 1084194229 857669926 0.90
2014-2015 1112742261 1135662118 0.90
 2015-2016 828319091 1139098939 0.78

Inference:
From the table working capital ratio registered a fluctuating trend
during the study period this is noted.
Hence it is found that the working capital ratio is managed by using
the cash & bank balance available in the company.

Chart 5.10 WORKING CAPITAL RATIO

 0.9 0.9
0.9 0.82
0.78
0.8
0.7
2011-2012
0.6
2012-2013
0.5
2013-2014
0.4
2014-2015
0.3 2015-2016
0.2 0.15
0.1
0

TREND ANALYSIS:
Y = a + bX

Where a = Y ; b = XY
n X2

TABLE 5.11

INVENTORIES

Inventories
YEAR X X2 (Rs ) XY
Y (Rs)
2011-12 -2 4 4,43,218,275 -8,866,436,550
2012-13 -1 1 4,56,536,544 -4,56,536,544
2013-14 0 0 4,93,646,982 0
2014-15 1 1 4,78,946,594 4,78,946,594
2015-16 2 4 4,53,879,119 9,07,758,148
TOTAL 5 10 2,326,227,424 43,731,558
(Source: Annual Report)

a = 2,326,227,424 = 4,65,245,484.8
5

b = 43,731,558 = 4,373,155.8
10
Inventories value in 2094-14 will be about 1,31,19,467.4 lakh.
TABLE 5.12

CASH / BANK

Cash / Bank
YEAR X X2 (Rs ) XY
Y (Rs)
2011-12 -2 4 4,72,165,527 -9,44,331,144
2012-13 -1 1 3,57,614,655 -3,57,614,655
2013-14 0 0 5,21,248,923 0
2014-15 1 1 3,06,643,076 3,06,643,076
2015-16 2 4 2,41,319,457 4,82,638,914
TOTAL 5 10 20,92,339,562 11,87,644,681
(Source: Annual Report)

a = 20,92,339,562 = 41,84,667,912.4
5
b = 11,87,644,681= 11,81,644,681
10

Cash/Bank value in 2013-14 will be about 418,46,67,912.4 lakh.

TABLE 5.13
RECEIVABLE

RECEIVABLE
YEAR X X2 (Rs) XY
Y (Rs)
2011-12 -2 4 3,26,151,232 -65,23,622,464
2012-13 -1 1 3,19,961,287 -3,19,961,287
2013-14 0 0 2,96,585,354 0
2014-15 1 1 3,14,999,942 3,14,999,942
2015-16 2 4 12,11,157,554 24,13,315,108
TOTAL 28 56,095.28 41,322.97
(Source: Annual Report)

A = 8090.75
5

b = 41,322.97 = 1,475.82
28

Sundry Debtors value in 2014-15 will be about 13,913.12 lakh.

TABLE 5.14
CURRENT LIABILITIES
 Current
YEAR X X2 Liabilities XY
(Rs) (Rs)
Y
2011-12 -2 4 2,21,154,699 -4,42,309,398
2012-13 -1 1 1,84,830,664 -1,84,830,664
2013-14 0 0 1,20,407,697 0
2014-15 1 1 1,12,919,857 1,12,919,857
2015-16 2 4 2,20,779,848 4,41,559,696
TOTAL 5 10 8,60,092,765 -40,52,660,509
(Source: Annual Report)

a = 8,60,092,765 = 17,2108,553
5

b = 40,52,660,509 = 4,14,266,140.9
10

Current liabilities value in 2094-15 will be about 8,10,438,369.33 lakh.

TABLE 5.15
BILLS PAYABLE
 BILLS
X X2 PAYABLE XY
YEAR
(Rs ) (Rs )
Y
2011-12 -2 4 56,677,194 -1,13,354,388
2012-13 1 1 1,28,990,909 -1,28,990,909
2013-14 0 0 14,135,140 0
2014-15 1 1 1,13,122,991 1,13,122,991
2015-16 2 4 67,966,652 1,35,933,313
TOTAL 5 10 4,98,208,587 -2,288,993
(Source: Annual Report)

a = 4,98,208,587 = 99,641,717.4
5

b = -2,288,993 = -228,899.3
10

Bills Payable value in 2094-15 will be about -6,866,979 lakh.

FINANCIAL STATEMENTS:

The history of financial statement analysis is traced back to the

beginning of 20th century. The analysis was started in western countries for
the use of credit analysis. Till 1914, financial institutions used to rely on the
facts of financial statements. But over a period of time, the need for analysis
was felt and a number of techniques were invested and made use of the
purpose of analysis.

The important techniques of analysis and interpretation of financial

statements are listed below

a. Comparatives financial statement

b. Trend analysis
c. Ratio analysis
(a). COMPARATIVE FINANCIAL STATEMENT.

This is yet another technique used in financial statement analysis.

These statements summaries and present related data for a number of years,
incorporating there in changes (absolute and relative) in individual items of
financial statements. These statements normally comprise comparative
balance sheets, comparative statements of change in total capital as well as
in working capital.

They help in making interfered and inter firm comparisons and also
highlights the trends in performance effeminacy, and financial position.

Table 5.16
COMPARATIVE BALANCESHEET OF
IIR TECHNOLOHIES INDUSTRIES CHENNAI (2011AND 2012)
PARTICULARS 2011 2012 (+) (or) (-)
(Rs) (Rs) In 2101 over 2111
Amount Percentag
e
ASSETS
CURRENT
ASSETS 443218275 456536544 13318269 3.09%
Stock 7498550 9128550 154090 20.54%
Deposits 326151226 319961287 -6189945 -1.87%
Bill Receivable 141649658 136081699 -5567959 -3.93%
Sundry debtors 90721130 -3711975 -3.93%
Cash in hand 94433114 12,39142129 92799539 -3.93%
Cash at bank 2,3608276
4
TOTAL (A) 124912357 1239142129 -9891539 -9.32%
8
FIXED ASSETS
Fixed Assets 445335336 445335336 - -
TOTAL (B) 445335336 445335336 - -
TOTAL ASSETS
(A+B) 169436891 1684477369 -9891545 -5.837%
4
LIABILITIES:
CURRENTLIBILI
TY: 16069414 22107922 6128517 37.57%
Sundry creditors 291414861 235281009 -55234.782 -19.10%
Bill Payable
TOTAL (C) 306584266 257388121 49196235 -16.13%
CAPITAL&RESE
RVE: 277556924 155673887 56%
Capital .6 356772334.5 41231113 -5.40%
Profit & loss a/c 763281556 856253611.8
LONGTERM
LOANS 346946162 -58125822 -16.75%
Loans 214063409.7
TOTAL 169436891 1684477369 -9891539 -5.83%
LIABILTIES 4

Table 5.17
COMPARATIVE BALANCESHEET OF
IIR TECHNOLOHIES INDUSTRIES CHENNAI (2012 AND 2013)
PARTICULARS 2012 2013 (+) (or) (-)
(Rs) (Rs) In 2101 over 2111
Amount Percentag
e
ASSETS
CURRENT
ASSETS 493646982 +37111338 +8.12%
Stock 456536544 12580790 3542240 +39.10%
Deposits 9128550 296585354 -23375933 -7.30%
Bills Receivable 319961281 143439642 +7357943 +5.40%
Sundry debtors 136081699 95626428 4914298 5.40%
Cash in hand 90721130 239066070 12623241 5.40%
Cash at bank 226811829
TOTAL (A) 123914212 1280945266 41811227 3.37%
9
FIXED ASSETS
Fixed Assets 445335336 447161879 1826543 +4.10%
TOTAL(B) 445335336 447161879 1826543 +4.10%
TOTAL ASSETS
(A+B) 168447736 1728107145 43369736 +2.59%
9
LIABILITIES:
CURRENTLIBILI
TY: 235281009 145140974 -91129135 -38.31%
Bills Payable 22107922 443822569 21714647 98.22%
Sundry debtors - 153914443 153914647 109%
Provisions
TOTAL 257388121 342877986 85489955 33.25%
CAPITAL&RESE
RVE: 356772334 207784373.9 -148987960 -41.75%
Capital 856253611 909398953.5 44145350.6 5.1%
Profit & loss a/c .8
LONGTERM
LOANS 62982431 29.42%
Loans 214063409 277135831.7

TOTAL 168447369 1728107145 43629776 2.59%

LIABILITIES

TABLE 5.18
COMPARATIVE BALANCESHEET OF
IIR TECHNOLOHIES INDUSTRIES CHENNAI (2014 AND 2015)
PARTICULARS 2014 2015 (+) (or) (-)
(Rs) (Rs) In 2100 over 2101
Amount Percentag
e
ASSETS
CURRENT
ASSETS 493646982 478946594 -14709388 -2.97%
Stock 12580790 25871970 13291180 114.64%
Deposits 296585354 314999999 18414645 6.20%
Bills Receivable 143439354 91998322 -51441320 -35.82%
Sundry debtors 956626428 61332216 -34294212 -33.83%
Cash in hand 239066070 153331439 -85735531 -32.86%
Cash at bank
TOTAL (A) 128094526 1126479640 -154465626 -12.14%
6
FIXED ASSETS
Fixed Assets 447161879 468472769 21330890 4.77%
TOTAL (B) 447161879 468472769 21330890 4.77%
TOTAL ASSETS
(A+B) 172810714 1594972409 -133134690 -12.14%
5
LIABILITIES:
CURRENTLIBILI
TY: 43822569 51128387 7314818 16.67%
Sundry creditors - 68174856 68174856 109%
Provision 145140974 -16668352 -11.48%
Bills Payable 128472622

TOTAL 188963543 247775865 58839322

31.13%
CAPITAL&RESE
RVE: 769571780 353842850 -415728930 -54.20%
Capital 461743068 1061528550 599785482 129.89%
Profit & loss a/c
LONGTERM
LOANS - -307828714 -109%
Loans 307828714

TOTAL 172810714 1594792409 -133314696 -7.71%

LIABILITIES 5

TABLE 5.19
COMPARATIVE BALANCESHEET OF
THE AUROMODE & CO
AS ON 31st MARCH (2015 AND 2016)
PARTICULARS 2015 2016 (+) (or) (-)
(Rs) (Rs) In 2094 over 2100
Amount percentag
e
ASSETS
CURRENT
ASSETS 8,35,823.0 15,35,450.0 +6,99,626.31 +83.70%
Stock 9 9 +25,090.09 +182.21%
Deposits 13,720.09 38,720.09 +20,482.60 +39.27
Loans & Advances 52,150.09 72,632.60 +4,36,887.10 +1128.14
Sundry debtors 42,083.40 4,78,970.52 -2,691.40 %
Cash in hand 4,111.95 1,321.55 +6,74,772.14 -67.06%
Cash at bank 37,136.40 7,11,908.54 +1817.10
%
TOTAL (A) 9,84,926.4 28,39,093.2 +18,54,076.77 +188.24%
4 1
FIXED ASSETS
Fixed Assets 40,30,142. 38,82,952.7 -1,47,109.09 -3.65%
75 5
TOTAL (B) 40,30,142. 38,82,952.7 -1,47,109.09 -3.65%
75 5
INVESTMENT:
Investment 1,09,090.0 40,090.09 -60,090.09 -60%
9
TOTAL 1,09,090.0 40,090.09 -60,090.09 -60%
9
TOTAL ASSETS
(A+B+C) 51,14,979. 67,61,955.9 +16,46,976.77 +32.19%
19 6
LIABILITIES:
CURRENTLIBILI
TY: 4,07,343.5 10,91,486.7 +6,84,143.22 +167.95%
Sundry creditors 0 2 +93,891.09 +93.56%
Provision 1,09,350.0 1,94,241.09
9

TOTAL (D) 5,07,693.5 12,85,727.7 +7,78,124.22 +153.24%

0 2
CAPITAL&RESE
RVE: 45,07,285. 44,17,978.2 -89,307.45 -1.98%
Capital 69 4 - -
Profit & loss a/c - -
TOTAL (E) 45,07,285. 44,17,978.2 -89,307.45 -1.98%
69 4
LONGTERM
LOANS 1,09,090.0 10,58,250.0 +9,58,250.09 +958.25%
Loans 9 9
TOTAL (F) 1,09,090.0 10,58,250.0 +9,58,250.09 +958.25%
9 9
TOTAL
LIABILITIES 51,14,979. 67,61,955.9 +16,46,976.77 +32.19%
(D+E+F) 19 6

CHAPTER V
FINDING, SUGGESTIONS & CONCLUSION

FINDINGS:
 Cash to current assets ratio has huge fluctuations during the period.
Cash position in of the company has uneven trend.
Uneven trend in networking
The company has its working capital ratio has been above the
standard norms during the period 2112-11, 11-12, 12-13.
Liquidity position of the company is satisfied.
Current assets are not properly utilized by the concern towards the
turnover.
Working capital turnover ratio in the year 2100 better when compare
to the previous year.
The company has spent huge expenses.

SUGGESTION:

The cash position of the company has not been properly maintained.
So the company has to make an effort to reduce the expenses and also
cash to current assets ratio.
 Company can utilize their assets properly.
Modernized equipments can purchase.
From current ratio, overall ratio was above the accepted norms of 0.5.
so the company has to reduce the overall ratio avoid the unnecessary
cash kept in ideal.
Company can properly maintain their debtors to sales turnover ratio.
A Working capital ratio has been maintained below the norms.

CONCLUSION

The project report is the apex of the master of business administration

course conducted by the Pondicherry University. The study is conducted at
IIR TECHNOLOHIES,CHENNAI withthe title of a study on working
capital management. This study was conducted mainly with help of
secondary data obtained from the unit.
The company should use the minimum investment in inventory to
organize it profitability. Whetherthe company may invest large size of
inventory to the concern. The efficient and production levels are decreased.
So the concern should maintain the maximum investment in inventory. The
company able to achieve the working capital management objectives in
proper way.

BIBILIOGRAPHY
Management accounting - S.N.MAHESHWARY
Financial management - I.M.PANDEY
Research methodology - C.R.KOTHARY
Management accounting - R.S.N.PILLAI
 &
BAGAVATHI

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