Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
ON
(MMS)
Submitted by:
Jasmeeta Setpal
Batch 2012-2014
I, Jasmeeta Bhagwan Setpal solemnly declare that the project work entitled
“Financial Compliances MIS Setup created for the Executive Desk for M.D at
Donear Industries Ltd”, is my original work, it is neither copied from any earlier
submitted work elsewhere or not merely copied, this is specifically prepared as a
part of MMS/PGDM curriculum, to be conducted in Year 2013.
This is to certify that the project titled “Customer Satisfaction Survey” been successfully and
satisfactorily completed and submitted by “Miss Jasmeeta Setpal” bearing a roll number,
M1244 as a student of Chanakya Institute of Management Studies & Research as
Prescribed by AICTE in fulfillment of the requirement for MMS during the year 2012 – 14.
Co-Internal Guide
A summer project is a golden opportunity for learning and self-development. I consider myself
very honored to have so many wonderful people lead me through in completion of this project.
I wish to express my indebted gratitude and special thanks to "Mr. Ashok Agarwal, V.P Finance
at Donear Industries Ltd." who in spite of being extraordinarily busy with his duties, took time
out to hear, guide and allowed me to carry out my industrial project work at their esteemed
organization.
I express my deepest thanks to Prof. Dipika Jain for her guidance and support.
I also wholeheartedly thank Prof. Roizman Monteiro forgiving his precious time and effort
during my whole project. He supported me by showing different methods of information
collection about the company. He helped me all the time when I needed him and he gave me
the right direction towards completing my project.
I would also like to thank Prof. Mughda Kulkarni for helping me decide the objectives for my
study.
I express my deepest thanks to them for taking part in useful decision & giving necessary
advices and guidance and arranged all facilities to make life easier. I choose this moment to
acknowledge their contribution gratefully.
A) To create an MIS Reporting Framework for ensuring financial compliance for all the
accounting and commercial reports.
The project basically talks about the need faced by Donear Industries Ltd with respect to reporting to
Top Management.
To overcome this problem there was a need to setup an Accounting MIS Framework which in
turn will help them to ensure financial compliance for all the accounting and commercial
reports.
We first conducted a survey with the help of a questionnaire within the department to
understand the attitudes of people and their comfort level in reporting to top management for
ensuring financial compliance for all the accounting and commercial report management.
This compliance gave rise to creation of new reports and some modification in existing reports.
Now to setup a financial framework, a checklist was prepared which gives details about all the
accounting reports, their frequency, the date of submission etc.
A proper MIS was made for commercial reports and new reports were created as per demand.
B) To analyze the efficiency and profitability of the firm of last five years with the help of
Ratio analysis as my major tool.
To analyze the efficiency and profitability, different ratios were classified as:
Profitability Ratios
Liquidity & Solvency Ratios
Management Efficiency Ratios
Investment valuation Ratios
One of the top three well-known brands in India in its product category... Donear primarily
caters to the middle and the premium segments with high quality apparel fabrics that are
woven with Natural Fibers, Synthetic Fibers and its Various Blends.
As a brand, Donear has succeeded by maintaining pace with the changing demands of the local
and global fashion trends, and primarily due to the company's innovative approach in
continuously developing newer products, using state-of-the-art-technology along with highly-
skilled workforce, strong logistics, by being perpetually quality conscious, and thereby creating
World-Class Fabrics.
These highly ingenious fabrics are available in a wide range of Colour, Texture and Comfort
along with Contemporary Designs. Donear fabrics are simply anaffordableluxury that suits every
desire!
Fabrics created by Donear have steadily captured the domestic textile markets as a result of its
well-planned and expanding sales network consisting of; 44 Agents, 290 Wholesalers and
12,000 Retailers, that are spread in all the 29 States&7 Union Territories of India. Similarly,
fabrics created by Donear have a wider reach in the overseas markets too, with exports to over
28 Countries across the globe.
Donear currently produces 11 million meters of fabric annually in its production unit located at
Silvasa - UT of Dadra & Nagar Haveli.
Woven intricately with Mr. Agarwal's vision, foresight and determination, the brand - DONEAR
was created in the significant year of 1977, and within a short span of time it became a
household name along with other Indian brands.
Known for its Pioneering Fabrics, Continuous Product Development and very Strong Marketing
Network, Donear persisted on building its reputation by catering to the ever growing needs of
the textile markets in India and abroad, and thus defined new standards in the field of fabric
manufacturing along with... excellent customer service.
Mr. VishwanathAgarwal
The Chief Promoter and Chairman of DIL started his career in textiles way back in 1959. He
has over four decades of experience and expertise in the textile industry.
Mr. RajendraAgarwal
The Promoter and Managing Director of DIL is a gold medalist in Textile Technology, and have
over two decades of techno-commercial experience in the textile industry.
The Promoter and Executive Director of DIL is a Commerce Graduate and is well experienced
in the textile industry since two decades. He has excellent marketing skills to his credit.
Apart from the above mentioned, Donear's success has a notable contribution from the
following eminent board of directors, namely;
Mr. SantkumarAgarwal
(Independent and Non-Executive Director)
Determined to fulfill its vision, Donear is on a mission to establish itself as one of the
prominent fabric manufacturers and to be known as a;
Timely Supplier of pioneering fabrics with the most contemporary designs & trends.
Understanding & Satisfying the need of the end-user with feedbacks and continuous
interaction.
And in accordance with the above... Donear now advances towards its mission with an
upcoming expansion plan that will have a technologically advanced production unit located at
Surat. It will specifically create High Value Yarn Dyed Cotton Shirting’s& Bottom Wear Fabrics
catering to the garment fabric supply (RMG) segment along with additional production of
Suiting & Shirting Fabrics.
Work Environment
Donear strongly believes that the textile industry is full of opportunities; especially for those
candidates who are dexterous and competent with a constant will to learn. And considering the
need for the best business practices, Donear provides a very conducive and friendly
environment to work with.
By recruiting unsurpassed talent, Donear remunerates at par with the best in the industry
standards allowing a substantial career growth. The core values of the organization lies in its
honesty and integrity, and due to all these above factors... The turnout ratio of employees is
minimal!
The upcoming production unit at Surat is spread over an area of 7.7 Hectares (19 Acres), and is
about 300 km from Mumbai City. The first phase has already been operational since December
2007.
With only a few hours of drive from Mumbai, the strategic location of the new unit is a great
advantage in terms of Strong Logistics, Better Connectivity and Quicker Accessibility via Rail
and Road links; ensuring on-time procurement of raw materials, and deliveries to Donear's
clients.
Another reason to increase production is, due to the rapid globalization; the spending power of
the growing middle-class segment in India has increased tremendously along with awareness in
fashion due to better exposure to the west.
Presently, Upper wear&Bottom wear fabrics account for 20% and 80% of the total production
created by Donear, and considering the expansion project, this would increase up to 45% and
55% respectively.
Nearly 10% of the total production is currently exported and this percentage will increase up to
25% with the underlying opportunities created by the post WTO scenario, and also due to the
expansion plans for creating 100% High Value Cotton Fabrics.
The Technology, Machinery, Know-How & Training at the upcoming Surat factory has been
conceived as one of the best in the global textile arena, specifically from Europe, considering
the future trends, fashion and committed service to all the customers.
The shirting collection will cover complete range of styles such as; Classic, Formal, Fashion &
Casual in plain, dobby and jacquard with each range having various categories like:
Yarn Dyed
Chambrays
Seersucker
Embossed
Crushed
Voiles, etc
With the above mentioned machinery and equipments, fabrics created by Donear will offer
various normal as well as Functional Finishes such as:
Crispy Finish
Anti-crease Finish
Stain Repellent Finish
Anti-bacterial Finish
Soft & Smooth Finish
Fire Retardant Finish
Mosquito Repellent Finish
Cool Touch Finish
Perfume Release Finish
Water Repellent Finish
Easy Care Finish
Enzyme Treatment Finish
Donear by entering into High Value Yarn Dyed Cotton Shirting & Bottom Wear Fabrics will be
manufacturing 6.5 million meters of fabric annually. This will increase the current production
capacity from 11 million meters, to a total of 17.5 million meters of fabric every year.
"The future is very bright for Donear! It intends to diversify and expand its activities in the
textile industry, and develop into one of the prominent fabric manufacturers in India and
abroad."
Spread over an expanse of 3.6 Hectares (9 Acres), the Silvasa plant has the most modern
machinery that produces 11 million meters of fabric annually.
Complying with stringent quality tests at all levels; be it testing of raw materials to the finished
products, is done cautiously at an in-house Quality Control Laboratory.
Polyester/Viscose
Polyester/Cotton
Polyester/Wool
100% Wool
100% Linen
Cotton/Linen
Donear follows the conventional procedure in producing all its world-class quality fabrics. Right
from procuring the raw material in the form of yarn to the finished fabric, it abides with
stringent quality tests at all levels to ensure that... The end-user of Donear fabrics gets value for
money!
The management team headed with an able and dynamic leadership of Mr.
RajendraAgarwal(M.D), ensures the smooth functioning of the organization that has
professionals in all departments like; Finance, Administration, Production, Sales & Marketing
and Exports.
The Executive Director Mr. Ajay Agarwal by way of his exceptional skills in sales &marketing,
makes certain that the world-class fabrics created by Donear, reaches the destined customer
within the stipulated period. His expertise is also shared in product designing and development.
At DIL, Quality & Innovation along with industrious effort is a daily ritual. Creating Quality
Fabrics for the 1500 expert textile workers who are familiar and well-experienced in
technology-skills, is customary like the daily chores that are performed with conscientious,
precise and result-oriented attitude.
Determined to create new bench marks, Donear imparts regular training programmes to all
the Donearites in technology-advancement to ensure that... The desired knowledge is updated
constantly!
“Quality & Innovation along with industrious effort is a daily ritual for
all Donearites!”
An impact of Donear'sregular interaction with the retailers, along with routine market surveys
in terms of; Designs, Colours, Textures etc., guarantees a quicker and a firsthand feedback,
which results in… providing fabrics to customers as per the trend!
The Suiting, Trouser and Shirting Fabrics produced by Donear are provided to prestigious
Garment Makers and Wholesalers to over 28 Countries that are located in regions like;
The fabrics that are exported by Donear have Several End Uses like;
Suits
Trousers
Shirts
Jacketing
Skirts
Work wear
Corporate Wear
Uniforms
Ladies Tops
100% Wool
Polyester/Viscose
Polyester/Wool
Polyester/Cotton (CVC)
Polyester / Viscose /Cotton
Polyester / Viscose /Lycra
Polyester /Wool/Lycra
100% Cotton
Linen Cotton
100% Linen
Cotton Modal
Wholesalers
Distributors
Garment Manufacturers
Known/Large Retailers
Buying Houses
Departmental Stores
Donear is in a position to export these varieties of fabrics either with its brand – DONEAR, or
can also supply with the desired specifications provided by the customer, in terms of packaging,
selvedge etc.
To keep itself updated, Donearregularly attends various Trade Shows that are held world-wide.
It also regularly participates in the 'TEXWORLD TRADE FAIR' that is held twice in a year in
Paris,France.
Considering the ever growing demands for Donear's fabrics abroad, the exports percentage is
slated to increase by up to 25%, due to its expansion plans, taking the total production from
the present 11 million to 17.5 million meters of fabric every year. And with an increase in the
production of cotton fabrics, Donear will be able to expand its activities and clientele in the US
& Europe.
Donear has developed an in-house Design Studio for bringing out new designs. An 'R & D' on a
regular basis is done to enable Donear to present its range of collections. Apart from this, the
fabrics are also made according to the specifications provided by the buyers.
Donear has an efficient team of Sales Professionals to meet out timely delivery. With a branch
office in place at Bangalore, it intends to open similar branch offices in different garment
manufacturing cities of India, where the staff will work closely with Donear's customers to give
them…The best services at all times!
Associates
Donear Industries Ltd. Page 16
In the words of the Chairman Mr. VishwanathAgarwal - "I would never lose them"... This is
truly practiced by Donear Industries Limited with all its associates namely:
Suppliers
From yarn, spare parts, packaging materials, to office automation products, etc,
ensure timely delivery of Good Quality Raw Materials and Products required for
Donear's unhindered functioning. Besides making on-time payments to all the
suppliers, Donear also provides them with feedback about the possible trends, and
suggestions for new developments, which enable them to develop their products
accordingly.
Agents
Spread all over India, these 44 Agents are the first ones to know and understand the
fabrics created by Donear. The efforts of all our agents ensure the product reaches on
time to all the wholesalers.
Wholesalers
Donear's 290 Wholesalers are the ones who not only stock the various fabrics but also
guarantee prompt supply to all the retailers located in their respective regions.
Retailers
A direct link between Donear and the end-user are the 12,000 retailers spread
through the length and the breadth of India. Their untiring efforts make sure that
every inch of fabric created by Donear is truly valued by the customer!
With such a close-knit bond between Donear and all its associates, regular
conferences are organized at well-known places in India like; Goa, Mount Abu,
Mussorie, Manali, Agra, Jaipur and so forth. Also, similar conferences are organized at
international destinations like Malaysia, Kathmandu & Dubai.
Investors
Are the financial backbone of Donear – who ensure Fair return to all the shareholders,
where Dividends are distributed regularly and bonus issues are made. Donear
expresses its thanks for your firm belief by way of investing in our company regularly
to help it grow and prosper.
End-Users
There is a special bond between the end-users and Donear! It voices its heart-felt
gratitude to all its consumers for patronizingDonear'sSuiting’s, Trousers & Shirting
Fabrics.
Donear owes its success to all their associates who have played a significant role in the
Media Watch
Donear Industries Ltd. Page 18
Events
Donearhasorganized the following important entertainment events like:
Tradeshows
Donear regularly takes part in TEXWORLD TRADE FAIR, which is held Paris, twice every year.
Apart from this, Donear have also participated in following exhibitions organized by the export
promotion council in following countries, namely:
Bangladesh
Colombia
Brazil
Sri Lanka
Tunisia
Morocco
USA
Industry Insight
Donear Industries Ltd. Page 19
Inside India
India has a very rich history in textiles. By the first century AD, India was already producing
woven cottons of noteworthy quality. Besides natural fibers such as Cotton, Jute and Silk,
Synthetic Raw Material products such as Polyester Staple Fiber, Polyester Filament Yarn,
and AcrylicFiber& Viscose Fiber are produced in India.
India's cotton textile industry has a high export potential as cost competitiveness is driving
the penetration of Indian yarns and fabrics in international commodity markets. This will
provide an expanded opportunity alongside enhanced competition for the Indian textile
units, as more markets would be open for access.
Presently, textiles account for 14% India's industrial production and around 27% of its export
earnings. India is the second largest employer in the textile sector in both rural and urban
areas as well, contributing to nearly 30% of the total exports, and employing 35 million
people approximately.
India is also in a position to provide a larger variety of casual wear and leisure garments at
significantly lower costs due to the availability of a large pool of experienced and low-cost
skilled textile workers.
Exports
The textile policy of 2000, in India, aims at achieving the target of textile and apparel exports
of US $ 50 billion by 2010 of which the share of garments will be US $ 25 billion. The main
markets for Indian textiles and apparels are USA, UAE, UK, Germany, France, Italy, Russia,
Canada, Bangladesh and Japan.
Other
Manmade fibers account for around 40% share in a cotton-dominated Indian textile industry.
India accounts for 15% of world's total cotton crop production and records as a largest
producer of silk.
The entire current output of the Indian textile industry (for domestic and export
consumption) is about US $ 35 billion.
Product Range
Fabrics like Suiting, Trouser &Shirting’s created by Donear come in a wide variety and range
Donear Industries Ltd. Page 21
meant for Menswear &Women’swear, such as:
These above mentioned blends of fabrics can be also made available With & Without Stretch
properties as per end use. These products can as well be made available with the desired
Patterns, Colours and Designs.
Brands
DONEAR is one of the most prestigious textile houses in India,
Our Retail EBOs:
DONEAR NXG
D'CotQualitywear
DONEAR SUITING’S&SHIRTING’S
DONEAR QSF
DONEAR INTERNATIONAL
Corporate Gifting
A gift is an excellent way to show how much you value a relationship! It's an unspoken
acknowledgement of Shared Bonds, Warmth and Life's Experiences, which at times words
cannot express... Just say it with a gift!
Donear Industries Limited has pioneered Corporate Gifting with its unique and very popular...
'Gifts 4 U' – The Perfect Gifts for All Occasions.
Gifts 4 U is a unique collection of finest quality Suiting’s, Trousers & Shirting Fabrics in Elegant
Gift Packs with packaging material in PP, PVC, Leatherette Pouches, Travel Bags, Briefcases,
Laptop Bags, Trolleys, Thermo ware, etc.
Gifts 4 U includes a Classic collection of Gifts & Promotional items that are Innovative, Useful,
and in keeping with the Current Trends. These are designed and packaged exclusively with an
aim to strengthen business relations, especially in the Corporate World.
To create an MIS Reporting Framework for ensuring financial compliance for all the
accounting and commercial reports.
To analyze the efficiency and profitability of the firm of last five years with the help of
Ratio analysis as my major tool.
The project is defined only to the extent of information made available by the
organization.
The findings and conclusions are based on the knowledge and experience of the
respondents which may be subject to bias.
In the past decade, developing countries (DCs)have been encouraged to reformtheir public
expenditure managementsystems and have increasingly embarked on major projects to
computerize their government operations. Most popular among these have been projects to
computerize government accounting and payment operations,by introducing government
financial management information systems (FMISs).
In most developing countries (DCs), budget execution and accounting processes were/are either
manual or supported by very old and inadequately maintained software applications. The
consequentlack of reliable and timely revenue and expenditure data for budget planning,
monitoring, expenditure control,andreporting has negatively impacted budget management of
many companies. Further, it was found to be difficult to provide an accurate, complete, and
transparent account of their financial position to other interested parties, including donors and the
general public. This lack of information has hindered transparency and the enforcement
ofaccountability in developing countries.
The establishment of an FMIS has consequently become an important benchmark for the
country, often regarded as a precondition for achieving effective managementof the budgetary
resources. Although it is not a panacea, the benefits of anFMIS could be argued to be profound.
First, the improved recording and processing of financial transactions also allows prompt and
efficient access to reliable financial data. This supports enhanced transparency and accountability
of the companies to the general public, and other external agencies.
Second, an FMIS strengthens financial controls, facilitating a full and updated picture of
commitments and expenditure on a continuous basis. Once a commitment is made, the
systemshould be able to trace all the stages ofthe transaction processing frombudget releases,
commitment, purchase, payment request, reconciliation of bank statements, and accounting of
expenditure. Thisallows a comprehensive picture of budget execution.
It is a Management Tool
It should provide a wide range of non-financial and financial information.
It is a system
Research Objective:-
To understand attitudes of people in accounts department with respect to MIS Reporting.
Research Plan:-
It was decided to conduct a survey within the organization and precisely in Accounts
Department as we are planning to make MIS Reporting Setup for only accounting and
commercial reports.
The main objective of this survey was to find out the attitudes of people towards
reporting system and comfort level in reporting to top management.
The survey was restricted only to employees working in accounts, stores and
commercial departments.
The survey was analyzed and feedback was sent to management.
Sample Size:-
20 Respondents (out of 35 employees working in the accounts department i.e almost
60%) were selectively chosen for the survey.
The criteria for these respondents were,
o People who maintained a team (8 people)
o Senior employees having more than 10 years experience in the accounts
department (4 people)
o People who provide reports to the Finance Vice President (8 people)
Parameters of Interest:-
It will help to know the interest level of the people with MIS
Helps to control their activities
Provide proper organized MIS Framework as per their requirement
Budgeting Constraint:-
Cost consideration from a practical point of view has a major impact upon decisions
relating to not only the size of sample but also the type of sample.
Statistical Technique:-
Statistics is the study of the collection, organization, analysis, interpretation and presentation of
data. It deals with all aspects of data, including the planning of data collection in terms of the
design of surveys and experiments.
Primary Research: -
A designed questionnaire for my primary research allowed us to find out information
such as facts, attitudes and opinions about the people.
With the help of questionnaire it became easier to know about the attitudes of the
people in Donear industries Ltd and understand whether there is a need for MIS
reporting and what is their comfort level in reporting to Top Management.
Questionnaire Design
The questionnaire used was a printed, well-structured formalized schedule to obtain
and record specified and relevant information with fair accuracy and completeness.
The questioning process was face-to-face interviews and the questionnaire was
designed in such a way that it could be understood and answered easily by the
respondents
My questionnaire includes more of closed ended questions such as
o Yes/No Questions (Dichotomous)
o Multiple Choice Questions
o Ranking Questions
It also include 1 open ended question for their suggestions and opinions, if any.
Secondary Research:-
Published data was used from
Annual reports
Standard Operating Procedures of Accounts Department
Tally
Existing MIS reports
Yes
100%
Interpretation:-
As per the survey conducted 100% of the people agreed that there is a need for MIS
Reporting.
With this we can say people there understand that proper MIS reporting will optimize
their work and this will benefit the company in long run.
15%
50%
Comfortable
35% Neutral
Very Comfortable
Interpretation:-
Interpretation:-
Interpretation:-
Majority of the people agreed that that the main benefit of the MIS framework will be
Timeliness since timely reports do not exist currently and most of the times this leads to
delayed status updates.
If the reports are maintained in a timely manner then there will be proper control over
the reports and discrepancies(if any) can be rectified immediately.
This will further result in completeness and greater accuracy of the reports leading to
improved efficiency and increased productivity in the organization.
It is disturbing to note that no one mentioned relevance as a benefit. Again this could be
because of lack of understanding of this term. However the entire list of reports must be
frequently (quarterly) checked for their relevance to ensure the time is not wasted on
preparing useless reports.
10%
No
Yes
90%
Interpretation:-
90% of the people agreed standard formats will be improving the productivity and keep
data in organized manner.
Standard formats ensure consistency in reporting formats. Suppose any employee
leaves the organization and a new employee joins in his/her place it will be easier for
him/her to report in the standard format.
10% of the people who disagreed need to be made aware of why such a framework is
important and how they could benefit from it. Ideally there should be 0% in this
category because every employee must believe in the work they do.
Interpretation:-
It will be very difficult to maintain reports on a daily basis as their daily routine work will
be affected. Also there is currently no need for many daily reports.
Most of the reports required by the organization are either weekly or monthly. However
proper follow up is required to ensure timely execution of the reports.
Very few reports are quarterly in nature. But more reports can be added of the key
indicator report type once the key employees understand its importance and identified
the area where it is needed.
40%
50%
Average
Excellent
Good
10%
Interpretation:-
Nobody marked “Worst” or “Bad” in their feedback which was a very good sign.
However better control of the data sharing process is necessary to target a “Good” or an
“Excellent”.
The MIS framework ensures that people share their data on time and this will take care
of this problem once it is implemented properly.
Interpretation:-
As major portion of the population has agreed that implementation of MIS reporting will
benefit the organization and at the same time will make the work computerized which
in turn will reduce paperwork.
For those that disagree, once the benefits of the MIS reports are seen the employees
will realize its importance.
Frequent MIS awareness must be carried out to stress the need of these reports and the
benefits to the organization and the employees.
Figure 16 : D'cot
This checklist acts as a DASHBOARD which tells you whether the file is updated on time or not and also
provides escalation time and status to track record and take immediate actions.
Escalation Time
Escalation Status
Escalation Closure Time
Escalation Closure Comments
This is the main screen for the MIS which gives details such as
This sheet includes details index about the MIS with the name of the report and its scheduled
frequency.
Formula:-
Objective of the Report: -The main objective of the report is to track pendency from the GRN
series in different units and reduced delays’.
Old Formats:-
These are old formats of reports which are too lengthy and difficult to maintain.
So to lower down their difficulty level and to systematically maintain these reports, we
have modified these reports by deleting and adding some columns which will give the
complete picture and control the delays and track pendency.
This is the main screen for the MIS for GRN based reports which gives details such as
This sheet includes details index about the MIS with the name of the report and its scheduled
frequency.
Formula:-
If bill date is nil, displayed nil and if cheque prepared date is nil, then check whether due
date is equal to today’s date,
o If it is equal display “PAYMENT DUE TODAY” and if it is not equal display the
difference
o If the difference is positive (i.e. 30 days) that means 30 days in hand to make the
payment
o If the difference is negative (i.e. -38 days) then that means you are delayed by
these many days.
2 10.00
8.69
1 0.5 0.5 0.5 0.5 0.68 4.8 5.00
0.2 0.01
0 0 0.00
-1 2008 2009 2010 2011 2012 -5.00
-2 -10.00
-3 -15.00
-4 -3.5 -20.00
-5 -4.33 -25.00
Year
Dividend Per Share Earnings Per Share Dividend Payout Ratio Cash Profit
Interpretation:-
As from the above chart you can see that the dividend per share is decreased in the year
2012 to 0.20 from 0.50 in all the year, from investor’s point of view it depicts that the
company is not doing well financially.
This will reflect a drop in market value of firm and investor may sell off share due to
fear.
Earnings per share is showing a decreasing trend
In the year 2009 & 2010 it displayed negative EPS which show this year proved to be a
bad year and in this year the company made huge losses which affected the earnings on
share drastically.
Interpretation:-
Operating Profit margin is showing a fluctuating trend as its shows the proportion of
revenue after paying for all the variable cost such as raw material, wages etc.
In the year 2009 the operating margin is the least as in that year the company made
huge losses and 2011 is highest that is 14.22 % which shows its earnings per rupee.
It is always favorable to have a higher operating margin as it helps us to now the firm
capacity to fulfill the fixed expenses such as interest on debt and taxes. Thus the
company has a favorable operating margin.
As you can see it is downwards dip may affect the company in future to pay its fixed
expenses. Therefore it is necessary to maintain a considerable amount of operating
margin to maintain its business.
10
4.2 3.94
5
1.12
0.01
0
2008 2009 2010 2011 2012
-5
-5.52
-6.54 -7.39
-10
-15 -11.92
Year
Interpretation:-
From this graph we can see that year 2009 and 2010 proved to be a very crucial year for
Donear Industries as the company had made Gross Loss and Net loss.
The reason behind this loss was high capital investment as the company started a new
manufacturing unit in Surat
As the capital investment in the initial year was too high, losses also increased which
affected the Gross and Net Profit of the company in the next subsequent years.
3 2.23
1.55
2
1
0
2008 2009 2010 2011 2012
Year
Interpretation:-
Debt Equity Ratio is showing an increasing trend and in the year 2012 the debt equity
ratio was the highest i.e 4:1 which is not favorable because it means that the company
relies more on external lenders thus resulting in higher risk especially at higher interest
rates.
Thus we can say the liability of the company is increasing which will affect the working
capital.
An increasing trend of debt-to-equity ratio is also alarming because it means that the
percentage of assets of a business which are financed by the debts is increasing.
2.5
2 1.64 1.73
1.55 1.55
1.5 1.06
1 0.77 0.79 0.78
0.5
0
2008 2009 2010 2011 2012
Year
Interpretation:-
Current ratio is showing a decreasing trend till 2011 which means the company is unable
to pay off their obligation which shows the company is not in good financial health.
One of the major reasons for this decline is new capital venture which started in the
year 2009 which affected the net profit as well.
But in 2012 the current asset ratio is 3.73 which is higher which means the financial
health of the company is becoming better and it is capable of paying its short term
obligation
Quick Ratio is showing a decreasing trend which means the company’s financial health is
not good as the company's ability to meet its short-term obligations with its most liquid
assets is low.
(that means the company debtors turnover ratio is declining which impacted on its
quick ratio)
0
2008 2009 2010 2011 2012
Year
Interpretation:-
Fixed Asset turnover ratio is low in the year 2009 as the company made huge capital
investment in fixed assets due it expansion plans in Surat, which increased the fixed
asset and was not able to generate more net sales from that year as it was not fully
operational.
To achieve optimal utilization for optimal production targets, the plant would require
more time as such development is gradual in nature which is reflected in subsequent
years. This would in turn result in higher sales and hopefully be factor in decreasing a
debt equity ratio.
Total Asset turnover is showing an upward trend which implies the firm’s efficiency in
generating sales or revenue with that of its fixed assets.
Interpretation:-
Inventory Turnover Ratiois showing a downward trend which means the rate of sales is
lesser than rate of production. Therefore the company must target new customers as it
cannot rely solely on its existing customers as demand is very low.
Debtors Turnover Ratio is showing anincreasingtrendwhich implies that its extension of
credit and collection of accounts receivable is efficient.
Interpretation:-
Return on capital employed in the year 2009 and 2010 is negative as company set up a
new manufacturing plant in Surat which increased the borrowings and reduce
shareholders earning.
As the production started in the subsequent years in the new plant the ROCE started
improving.
IT department of the company should now work towards integrating the system on a
higher level and making the company Paper-Less Office. This should be done
by integrating the system in a way that the manual intervention is minimized
in the day-to-day process.
A strong follow-up is necessary so as to continue with the process of reporting as per
weekly and monthly frequencies.
Any changes in the set formats should only be done only with the permission of
concerned persons and if any changes are required in the process a set procedure
should be followed.
Immediate action should be taken on those who are not following the process of
reporting as per schedule and proper dashboard should be maintained on weekly basis
to send to the top management which should give details about whether the reports are
updated or not.
B) For analyzing the efficiency and profitability of the firm for the last five
years with the help of Ratio analysis.
The company should maintain its Debt – Equity Ratio. As of now it is quite high which may
affect the company’s efforts to attract additional capital in future.
From the investor’s point of view the company should give a considerable DPS to its
shareholders to improve the market value of the firm.
As the company is expanding, the company should also start targeting new prospects to
increase its sales and improve its profitability.
To measure the efficiency and financial health of the company Debt – Equity Ratio gives a better
understanding than that of current and quick ratio as it includes only the short term loans and
advance and not long term debts.
The Debt – Equity Ratio is showing and upward trend which is not good and may affect the
company’s financial leverage in the long run.
Company Profile
http://www.donear.com/donear2006/corporate_over.asp
Annual Reports
http://www.donear.com/donear2006/annual_report.asp
Name:-
Designation:-
Date:-
1. Do you think there is a need for accounting MIS reporting in the
organization?
2. What will be your comfort level in reporting to top management with the
help of standard MIS format?
Very Uncomfortable
Uncomfortable
Neutral
Comfortable
Very comfortable
Timeliness
Accuracy
Consistency
Completeness
Relevance
7. How will you rate for availability of data in making the report?
9. Will the following purpose be fulfilled with the help of MIS reporting?
Yes No