INTRODUCTION

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Cash management is a marketing term for certain services offered primarily

to larger business customers. It may be used to describe all bank accounts (such as checking accounts) provided to businesses of a certain size, but it is more often used to describe specific services such as cash concentration, zero balance accounting, and automated clearing house facilities. Sometimes, private bank customers are given cash management services.

Traditionally having a paper-based clearing system involving not only high processing cost but security risk, cash management in India has certainly undergone a paradigm change. From a product-centric approach, the focus for almost all banks today has shifted emphatically to the customer. And success is all about bringing the maximum possible delivery channels to the prospect's doorstep. In the rapidly transforming world of business, banking faces its biggest challenge yet - constant change. With every bank seeming to offer service possible, efficiency coupled with innovative value added solutions have emerged as the key business differentiators that affect a bank's bottom line. Confronted with shrinking deposits/margins, rising customer expectations and intensifying competition, banks must at all times strive to be a step ahead of industry standards. At the same time, they cannot lose sight of credit risk, a natural byproduct of the increasingly complex relationships in today's dynamic markets. For some time now, technology has been the key driving force behind every successful bank. In such an environment, the ability to recognise and capture market share depends entirely on the bank's competence to evolve technically and offer the customer a seamless process flow. The objective of a cash management system is to improve revenue, maximise profits, minimise costs and establish efficient management systems to assist and accelerate growth. Today a corporate treasurers dilemma is multifaceted. With more movement towards the regional/central liquidity management in the complex structure of rules and regulations, further complication is caused by taxation issues.
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I describe what a corporate treasurer needs as VOC - Visibility of funds, Optimized returns on funds, and Control over receivables and payables. Treasury can face a number of issues related to the slow movement of funds, locked working capital, loss of float income, high cost of funds, time consuming reconciliation and manual processes. In India the cash management business primarily involves collections and payments services.

Cash Management in India

Products offered by banks under collections (paper and electronic): o Local cheque collections. o High value (0 Day clearing). o Magnetic ink character recognition (MICR) (three day clearing of cheques). o Outstation cheque collections. o Cheques drawn on branch locations. o Cheques drawn on correspondent bank locations. o Cheques drawn on coordinator locations. o House cheque collections. o Outside network cheque collections. o Cash collections. o ECS-Debit. o Post dated cheque collections. o Invoice collections. o Capital market collections.

Products offered by banks under payments (paper and electronic): o Demand drafts/bankers cheques. o Customer cheques. o Locally payable. o Payable at par.
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o RTGS/NEFT/ECS. o Cash disbursement. o Payments within bank. o Capital market payments. The Reserve Bank of India (RBI) has placed an emphasis on upgrading technological infrastructure. Electronic banking, cheque imaging, enterprise resource planning (ERP), real time gross settlements (RTGS) are just few of the new initiatives. The evolution of payment systems such as RTGS has posed some tough challenges for cash management providers. It is important that banks now look towards a shift to fees from float although all those cash management providers who have factored in float money in their product pricing might take a hit. But of course there are opportunities also attached like collection and disbursal of payments on-line across the banks. There are a number of regulatory and policy changes that have facilitated an efficient cash management system (CMS). Fox example, the Enactment of Information Technology Act gives legal recognition to electronic records and digital signatures. The establishment of the Clearing Corporation of India in order to establish a safe institutional structure for the clearing and settlement of trades in foreign exchange (FX), money and debt markets has indeed helped the development of financial infrastructure in terms of clearing and settlement. Other innovations that have supported in streamlining the process are: Introduction of the Centralized Funds Management Service to facilitate better management of fund flows. Structured Financial Messaging Solution, a communication protocol for intra-bank and interbank messages.

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Evolution of Services One of the emerging cash management services in India is payment outsourcing. Though cheques and drafts are a popular mode of payment in India, it is obviously a time consuming procedure because of the manual processing required. This is an area where payment outsourcing can help. It allows corporates to reduce their overheads and focus on their core competencies and, as a result, benefit from speed and accuracy. The enhanced security it offers also allows for tighter fraud control. For the Indian payment system to become completely seamless there are many variables that need to be tackled, such as regulatory and legal issues, customer behaviour and infrastructure. As more corporates and banks have added technology to their processes, the issues surrounding connectivity security have become much important. Today, treasurers need to ensure that they are equipped to make the best decisions. For this, it is imperative that the information they require to monitor risk and exposure is accurate, reliable and fast. A strong cash management solution can give corporates a business advantage and it is very important in executing the financial strategy of a company. The requirement of an efficient cash management solution in India is to execute payments, collect receivables and managing liquidity. Traditional or e-business objectives, in India there are different cash management solutions. Cash Management Services generally offered

The following is a list of services generally offered by banks and utilized by larger businesses and corporations:

Account Reconcilement Services: Balancing a checkbook can be a difficult process for a very large business, since it issues so many checks it can take a lot of human monitoring to understand which checks have not cleared and therefore what the company's true balance is. To address this, banks have
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developed a system which allows companies to upload a list of all the checks that they issue on a daily basis, so that at the end of the month the bank statement will show not only which checks have cleared, but also which have not.

Advanced Web Services: Most banks have an Internet-based system which is more advanced than the one available to consumers. This enables managers to create and authorize special internal logon credentials, allowing employees to send wires and access other cash management features normally not found on the consumer web site.

Armored Car Services: Large retailers who collect a great deal of cash may have the bank pick this cash up via an armored car company, instead of asking its employees to deposit the cash.

Automated Clearing House: services are usually offered by the cash management division of a bank. The Automated Clearing House is an electronic system used to transfer funds between banks. Companies use this to pay others, especially employees (this is how direct deposit works). Certain companies also use it to collect funds from customers (this is generally how automatic payment plans work). This system is criticized by some consumer advocacy groups, because under this system banks assume that the company initiating the debit is correct until proven otherwise.

Balance Reporting Services: Corporate clients who actively manage their cash balances usually subscribe to secure web-based reporting of their account and transaction information at their lead bank. These sophisticated compilations of banking activity may include balances in foreign currencies, as well as those at other banks. Finally, they offer transaction-specific details on all forms of payment activity, including deposits, checks, wire transfers in and out, ACH (automated clearinghouse debits and credits), investments, etc.
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Cash Concentration Services: Large or national chain retailers often are in areas where their primary bank does not have branches. Therefore, they open bank accounts at various local banks in the area. To prevent funds in these accounts from being idle and not earning sufficient interest, many of these companies have an agreement set with their primary bank, whereby their primary bank uses the Automated Clearing House to electronically "pull" the money from these banks into a single interest-bearing bank account.

Lockbox services: Often companies (such as utilities) which receive a large number of payments via checks in the mail have the bank set up a post office box for them, open their mail, and deposit any checks found. This is referred to as a "lockbox" service.

Positive Pay: Positive pay is a service whereby the company electronically shares its check register of all written checks with the bank. The bank therefore will only pay checks listed in that register, with exactly the same specifications as listed in the register (amount, payee, serial number, etc.). This system dramatically reduces check fraud.

Sweep Accounts: are typically offered by the cash management division of a bank. Under this system, excess funds from a company's bank accounts are automatically moved into a money market mutual fund overnight, and then moved back the next morning. This allows them to earn interest overnight. This is the primary use of money market mutual funds.

Zero Balance Accounting: can be thought of as somewhat of a hack. Companies with large numbers of stores or locations can very often be confused if all those stores are depositing into a single bank account. Traditionally, it would be impossible to know which deposits were from which stores without seeking to view images of those deposits. To help correct this problem, banks developed a system where each store is given their own bank
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account, but all the money deposited into the individual store accounts are automatically moved or swept into the company's main bank account. This allows the company to look at individual statements for each store. U.S. banks are almost all converting their systems so that companies can tell which store made a particular deposit. Therefore, zero balance accounting is being used less frequently.

Wire Transfer: A wire transfer is an electronic transfer of funds. Wire transfers can be done by a simple bank account transfer, or by a transfer of cash at a cash office. Bank wire transfers are often the most expedient method for transferring funds between bank accounts. A bank wire transfer is a message to the receiving bank requesting them to effect payment in accordance with the instructions given. The message also includes settlement instructions. The actual wire transfer itself is virtually instantaneous, requiring no longer for transmission than a telephone call.

Controlled Disbursement: This is another product offered by banks under Cash Management Services. The bank provides a daily report, typically early in the day, that provides the amount of disbursements that will be charged to the customer's account. This early knowledge of daily funds requirement allows the customer to invest any surplus in intraday investment opportunities, typically money market investments. This is different from delayed disbursements, where payments are issued through a remote branch of a bank and customer is able to delay the payment due to increased float time.

In the past, other services have been offered the usefulness of which has diminished with the rise of the Internet. For example, companies could have daily faxes of their most recent transactions or be sent CD-ROMs of images of their cashed checks. Cash management aims at evolving strategies for dealing with various facets of cash management. These facets include the following:
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 Optimum Utilisation of Operating Cash Implementation of a sound cash management programme is based on rapid generation, efficient utilisation and effective conversation of its cash resources. Cash flow is a circle. The quantum and speed of the flow can be regulated through prudent financial planning facilitating the running of business with the minimum cash balance. This can be achieved by making a proper analysis of operative cash flow cycle alongwith efficient management of working capital. Cash Forecasting Cash forecasting is backbone of cash planning. It forewarns a business regarding expected cash problems, which it may encounter, thus assisting it to regulate further cash flow movements. Lack of cash planning results in spasmodic cash flows. Cash Management Techniques: Every business is interested in accelerating its cash collections and decelerating cash payments so as to exploit its scarce cash resources to the maximum. There are techniques in the cash management which a business to achieve this objective. Liquidity Analysis: The importance of liquidity in a business cannot be over emphasized. If one does the autopsies of the businesses that failed, he would find that the major reason for the failure was their unability to remain liquid. Liquidity has an intimate relationship with efficient utilisation of cash. It helps in the attainment of optimum level of liquidity. Economical Borrowings Another product of non-synchronization of cash inflows and cash outflows is emergence of deficits at various points of time. A business has to raise funds to the extent and for the period of deficits. Raising of funds at minimum cost is one of the important facets of cash management.

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Purpose of Cash Management Cash management is the stewardship or proper use of an entitys cash resources. It serves as the means to keep an organization functioning by making the best use of cash or liquid resources of the organization. The function of cash management at the U.S. Treasury is threefold:

1. To eliminate idle cash balances. Every dollar held as cash rather than used to augment revenues or decrease expenditures represents a lost opportunity. Funds that are not needed to cover expected transactions can be used to buy back outstanding debt (and cease a flow of funds out of the Treasury for interest payments) or can be invested to generate a flow of funds into the Treasurys account. Minimizing idle cash balances requires accurate information about expected receipts and likely disbursements.

2. To deposit collections timely. Having funds in-hand is better than having accounts receivable. The cash is easier to convert immediately into value or goods. A receivable, an item to be converted in the future, often is subject to a transaction delay or a depreciation of value. Once funds are due to the Government, they should be converted to cash-in-hand immediately and deposited in the Treasury's account as soon as possible.

3. To properly time disbursements. Some payments must be made on a specified or legal date, such as Social Security payments. For such payments, there is no cash management decision. For other payments, such as vendor payments, discretion in timing is possible. Government vendors face the same cash management needs as the Government. They want to accelerate collections. One way vendors can do this is to offer discount terms for timely payment for goods sold

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COMPANY PROFILE

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The Company, headquartered at Kolkata, is a part of the Williamson Magor Group. The EPC project activity of the company is managed through separate Business Divisions Groups that assume responsibility for each activity from concept to commissioning. MBE has been awarded ISO 9001:2008 certification. MBE manufactures a wide range of products required for its various projects through its subsidiary company McNally Sayaji Engineering Ltd. (MSEL), to whom it provides the requisite technology and design to manufacture the products. MSEL product range includes crushing, Mobile Crushing and Screening Plants, screening & milling equipment, pressure vessels, material handling equipment, steel plant equipment, process equipment like flotation cells, thickeners, slurry pumps etc. MBE has technical collaborations with some of the worlds leading firms for each of their activities. Some of their associates include SOLIOS - France, PoltegorPoland, TPE - Russia, DMT - Germany, Siemens Vai - France, KCI Cranes Finland, CODCO - China, GRD Minproc - Australia, Gea Messo - Swiss, MCC (China), Uralmash Engg. - Russia, Mekhanobr Chormet (Ukraine) etc. MBE through its subsidiary MBE Mineral Technology (P) Ltd, have acquired in 2009 the Coal & Mineral Technology division of KHD Humboldt Wedag, a global leader in coal and mineral processing. MBE also has a third subsidiary EWB, Hungary. McNally Sayaji Engineering Limited (MSEL), has been formed by the merger of the 60 year old Sayaji Iron & Engineering Co. Ltd., Baroda with the Products Division of McNally Bharat Engineering Company Limited having factories at Kumardhubi, Asansol and Bangalore. MSEL is one of the countrys leading manufacturers of Crushing, Screening, Milling, Material Handling & other heavy equipment, serving the core sector industries.

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The Product range includes Mobile Crushing & Screening Plants, Crushers, Screens, Grinding mills, Feeders, Scrubbers. Stockyard equipment such as Stacker Reclaimers, Wagon Tipplers, Paddle Feeders. Open cast mining machinery such as Bucket Wheel Excavators, Shiftable Conveyors, Spreaders, Port Cranes. Mineral Processing plants such as Hydrocyclones, Floatation Cells, Thickeners, Slurry Pumps, Pressure Vessels, Heat Exchangers, Rotary kilns, Driers, Coal washeries etc. MSEL has recently also ventured into manufacturing critical fabricated equipment for nuclear power industry like Reactor Building Main Airlock doors. MSEL has four manufacturing units located at Kumardhubi in Jharkand, Asansol in West Bengal, Bangalore & Baroda. All manufacturing units have ISO 9000 certification. With Marketing & Branch offices located at Kolkata, Baroda, Kumardhubi, Bangalore, Chennai, Secunderabad, Cochin, Nagpur, Vizag and Vijaywada, MSEL is geared to provide total customer support in any part of the country. MSEL has absorbed technology over the years through various strategic alliances and has established a strong R&D and Design & Development team to provide optimum and cost effective solutions to customer needs. MSEL is a subsidiary of McNally Bharat Engineering Co. Ltd., a leading engineering company in India with diversified interests in EPC business in Power & Coal, Mining & Metals, Steel, Port & Shipyard and other industries. McNally Sayaji Engineering Limited (MSEL), Kumardhubi ,Jharkhand This is where the story of McNally Bharat Engineering began in 1961 when McNally Pittsburg set up a state-of-the-art plant in those times in the middle of the coal belt. The facilities have been upgraded and today there are very few facilities in the country to match what is available at the Kumardhubi works of MSEL. The Kumardhubi plant has a covered area of 18,750 sq mtrs & an open area of 35,250 sq mtrs.
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Heavy Fabrication and machining shop has EOT crane facility of 70 MT. The fabrication shop can roll plates upto 120mm thickness and other facilities include MIG welding, optical tracing profile cutting etc.

The machining facility includes Vertical Boring m/c (Max. work Dia 8 Meters), SKODA CNC Boring m/c (Max. work length 8 meters), Gear Hobber (Max work dia 8 meters), CNC Oxy Fuel Plasma Profile Gas Cutting (upto 200mm plate thickness), lathes with 5mts bed length. Other facilities include dynamic balancing, shot blasting, oil fired stress relieving furnace etc. The Kumardhubi Unit is an integrated unit having Engineering & Design, Purchase, Marketing, Machining & Fabrication shop, Assembly & QA under one roof, to provide customers a total solution from design to installation of equipment. The Kumardhubi unit has ISO 9001:2008 certification and has obtained NABL accreditation for Mechanical testing. ASME has also approved the Unit for U stamping of Pressure vessels as per ASME Section VIII, Division 1.

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BOARD OF DIRECTORS McNALLY SAYAJI ENGINEERING LTD.

CHAIRMAN MANAGING DIRECTOR MR. DEEPAK KHAITAN MR. SHAMBHU PRASAD

MR.SUBIR RANJAN DASGUPTA MR. CHANDRAKANT PANSARI MR. PADAM KHAITAN DIRECTORS MR.SANJAY S. PATEL MR. HEATH BRIAN ZARIN

COMPANY SECRETARY KUMARDHUBI PLANT

MR. AMIT PATHAK P.O. KUMARDHUBI, DIST. DHANBAD, JHARKHAND 828 203

REGISTERED OFFICE

4 MANGO LANE, 7TH FLOOR KOLKATA 700 001

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Quality Assurance Surveillance

Quality Assurance Department for McNally Sayaji is effectively run by qualified and experienced engineers from different disciplines of engineering.

All the factories are certified under - ISO 9001:2008 (Quality Management System).

A section of QA personnel located at the factories are trained in nondestructive testing in the field like Ultrasonic Testing, Radiography Testing, Magnetic Particle Testing and Liquid Dye Penetration Testing. These people are qualified under ASNT Level II/ Level-I in the abovementioned areas.

The factories are equipped with non-destructive testing facilities for Radiography Testing; help is taken from the approved and reputed third party testing agencies that are also certified by NABL body.

The factories are equipped with good Testing Laboratory facilities for Chemical Analysis as well as Mechanical Testing besides its in-house standard room for instrument calibration required for the measuring instruments.

The QA personnel control the inspection and testing of the raw material in process and final - for the products or equipment manufactured at the works.

Depending upon the situation MSEL sometimes hires the services of globally known third party inspection agencies like Lloyds, Bureau Veritas, Indian Register Of Shipping etc.

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SAFETY POLICY McNally Sayaji Engineering Limited, resolve that safety is an integral part of our Industry. We have adequate safety measures built in our plants, in Production & Maintenance functions. Our endeavor will always be to keep the plant in the safest of conditions. We are committed to provide a safe, clean and healthy work environment to our employees, ensuring compliance with all statutory laws and regulations. We Shall:

Constitute a Safety Committee Comprising Management Staff and workmen for creating a total awareness about safety at all levels.

Operate with the conviction that all accidents are preventable and aim for "Zero" accident.

Impart training regarding safe work practices from time to time to one and all and keep them informed about safety advancement.

Ensure that the Contractors, Transporters, other agencies and visitors to the factory abide by Safety Rules.

Provide personal protective equipment whenever and wherever required. Encourage and create interest amongst all by organizing Safety Competitions, Slogans and Cartoon Contests.

Discharge our personal responsibility and cooperate and actively participate in maintaining and improving safety standards.

Follow safety rules, regulations, safe operating procedures / work methods that are designed to protect people and equipment from risk of injury or damage to property.

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MCNALLY SAYAJI ENGINEERING LIMITED BALANCE SHEET AS AT 31st MARCH, 2012

As at PARTIULARS EQUITY AND LIABILITIES Share Capital Reserves and Surplus Money received against Share warrants Non-current liabilities Long term borrowings Deferred Tax Liabilities (net) Other Long term liabilities Long term Provisions Current liabilities Short term borrowings Trade Payables Other Current liabilities Short term Provisions TOTAL ASSETS Fixed assets Tangible assets Intangible assets Capital work-in-progress Non-current investments Long-term loans and advances Other non-current assets Current assets Current investments Inventories Trade receivables Cash and Bank Balances Short-term loans and advances Other current assets TOTAL 18 19 20 21 22 23 10,011 10,877 402 3,665 2,186 2 9,678 15,074 347 2,011 4 15 16 17 13 14 13,020 1,041 5,950 0 322 326 13,401 1,312 3,570 0 367 357 9 10 11 12 8,859 7,420 4,344 201 6,585 6,439 4,738 430 Note No. 2 3 4 5 6 7 8 31st March,12
Rs. In Lakhs

As at 31st March, 11 Rs. In Lakhs 899 17,671 237 8,038 931 155

899 17,902 6,998 930 3 244

47,800

46,123

47,800

46,123

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MCNALLY SAYAJI ENGINEERING LIMITED STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31st MARCH, 2012
As at 31st March,12
Rs. In Lakhs

PARTICULARS Revenue from operations Other income Total Revenue (A) Expenses Cost of materials consumed Changes in inventories of finished goods and WIP Employee benefits expense Finance costs Depreciation and amortization expense Other expenses Total expenses (B) Profit/(Loss) before tax (A-B) Exceptional items Profit before extraordinary items and tax Tax expenses: Current tax Deferred tax Total tax Profit for the year Earnings per equity share (Face Value of Rs 10/Each)

As at 31st March,11
Rs. In Lakhs

26044 532 26,576 14,891 -1,887 4,159 1,794 1,100 8,819 28,876 -2,300 2,612 312 95 -1 94 218 2.18

29626 364 29,990 14,089 -1,413 3,597 1,423 1,038 9,292 28,026 1,964 1,964 500 145 645 1,319 13.19

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MCNALLY SAYAJI ENGINEERING LIMITED CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH 2012
As at As at 31st March, 11 Rs. In Lakhs
1,964

PARTICULARS
Profit/(Loss) before taxation from operations Adjustments for: Depreciation Amortisation Interest Expense Interest Income Loss/( Profit) on Sale of Tangible Assets (Net) Profit on Sale of Investment (Net) Bad Debts written off Advance written off Inventories written off Allowance for bad and doubtful trade receivebales Allowance for doubtful advances Allowance for Slow moving Stores Liabilities / provision no longer required written back Provision for employee benefits (Net) Unrealised gain on exchange (Net) Operating Profit Before Working Capital Changes

31st March,12
Rs. In Lakhs
-2,300

745 355 1,794 -2 8 0 12 1 100 12 10 -442 115 -21 2,687 387

705 333 1,423 -24 -59 -45 1 38 105 11 -134 59 -13 2,400 4,364

Adjustments for: Trade and Other Receivables Inventories Trade Payables Cash Generated from Operations 300 -343 1,025 982 1,369 -1,857 -3,536 179 -5,214 -850

Direct Taxes Paid (Net) Cash flow before exceptional items Exceptional items - relating to sale of land at Vadodara Net Cash from Operating Activities

-139 1,230

-932 -1,782

2,612 3,842

-1,782

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B. Cash Flow from Investing Activities: Purchase of Tangible / Intangible Assets Sale of Tangible Assets Interest Received Sale of Current Investments Net Cash used in Investing Activities -3,260 257 5 2 -2,996 -2,996 -4,043 71 27 116 -3,829 -3,829

C. Cash Flow from Financing Activities: Interest Paid Refund of share warrants application money Proceeds/(Repayment) of Long Term Borrowings Proceeds/(Repayment) of Other Borrowings Dividend paid (including tax thereon) Net Cash from Financing Activities -1,826 -1,033 2,274 -206 -791 -791 -1,365 -7 3,870 1,371 -208 3,661 3,661

Net Increase/(Decrease) in Cash and Cash Equivalents

55

-1,950

Cash and Cash Equivalents (Opening Balance) Cash and Cash Equivalents (Closing Balance)

347 402

2,297 347

Notes to the Cash Flow Statement for the year ended 31st March 2012

1. Cash and Cash Equivalents comprise of: Cash on hand Cheques, drafts on hand Balances with Banks * 15 15 372 402 23 324 347

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Issues in Cash management Cash management refers to the administration of all components of working capital. 1. Debtors Management 2. Creditors(Payables) 3. Inventories Management(Stock)

CURRENT ASSETS: MSEL, KUMARDHUBI

DESCRIPTION ACTUAL (11-12)

Current investments Inventories Trade receivables Cash and Bank Balances Short-term loans and advances Other current assets TOTAL

10011 10,877 402 3,665 2,186 27141

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CURRENT LIABILITIES: MSEL, KUMARDHUBI

DESCRIPTION ACTUAL (11-12)

Short term borrowings Trade Payables Other Current liabilities Short term Provisions
TOTAL

8,859 7,420 4,344 201

20824

FIXED ASSETS: MSEL, KUMARDHUBI

DESCRIPTION GROSS BLOCK LESS:DEPRECIATION NET BLOCK ACTUAL(11-12) 16748 3727 13020

Current assets to fixed asset ratio A firm needs current and fixed assets to support a particular level of output. However, to support the same level of output the firm can have different levels of current assets. As the firms output and sales increases, the need for current asset increases. Generally the current assets do not increase in direct proportion to output; current assets may increase at a decreasing rate with input. This relationship is based upon the notion that it takes a greater proportional investment in current assets when only a few units of output are produced than it does later on when the firm can use its current assets more efficiently.
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The level of the current assets can be measured by relating current assets to fixed assets. There are three policies:1) conservative current assets policy: CA/FA is higher. It implies greater liquidity and lower risk. 2) aggressive current assets policy: CA/FA is lower. It implies higher risk and poor liquidity. 3) moderate current assets policy: CA/FA ratio falls in the middle of conservative and aggressive polic ies.

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In case of MSEL, KUMARDHUBI, the ratio of current asset to fixed asset is

CURRENT ASSETS FIXED ASSETS

CURRENT ASSETS FIXED ASSETS

RATIO

27141 13020 2.0845

POLICIES FOR FINANCING CURRENT ASSETS The following policies for financing current assets in MSEL:-

LONG TERM FINANCING: The sources of long term financing include ordinary shares capital, preference share capital debentures, long term borrowings from financial institutions and reserves and surplus. MSEL manages its long term financing from capital reserve, share premium A/C, foreign project reserve, bonds redemption reserve and general reserve. SHORT TERM FINANCING: The short term financing is obtained for a period less than one year. It is arranged in advance from banks and other suppliers of short term finance include working capital funds from banks, public deposits, commercial paper, factoring of receivables etc.

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MSEL manages secured loans as:1) Loans and advances from banks 2) Other loans and advances: (i) Debentures/bonds (ii) Loans from State Govt. (iii) Loans from financial institutions(secured by pledge of PSU bonds and bills accepted guaranteed by banks) 3) Interest accrued and due on loans (a) From State Govt. (b) From financial institutions bonds and other (c) Packing credit

MSEL manages unsecured loans as:1) Public deposits 2) Short term loans and advances: (1) From banks (a) Commercial papers (2) From others (a) From companies (b) From financial institutions 3) Other loans and advances (a) From banks (b) From others (i) From govt. of India (ii) From state govt. (iii) From financial institutions (iv) From foreign financial institution (v) Post shipment credit exim bank (vi) Credit for assets taken on lease

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4) Interest accrued and due on (a) Govt. credit (b) State Govt. loans (c) Credits for assets taken on lease (d) Financial institutions and others (e) Public deposits SPONTANEOUS FINANCING:Spontaneous financing refers to the automatic sources of short term funds arising in the normal course of a business. Trade Credit and outstanding expenses are examples of spontaneous financing. A firm is expected to utilize these sources of finances to the fullest extent. The real choice of financing current assets, once the spontaneous sources of financing have been fully utilized, is between the long term and short term sources of finances. What should be the mix of short and long term sources in financing current assets? Depending on the mix of short and long term financing, the approach followed by a company may be referred to as: 1. Matching approach 2. Conservative approach 3. Aggressive approach

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Matching approach The firm can adopt a financial plan which matches the expected life of assets with the expected life of the source of funds raised to finance assets. Thus, a ten year loan may be raised to finance a plant with an expected life of ten year; stock of goods to be sold in thirty days may be financed with a thirty day commercial paper or a bank loan. The justification for the exact matching is that, since the purpose of financing is to pay for assets, the source of financing and the asset should be relinquished simultaneously. Using long term financing for short term assets is expensive as funds will not be utilized for the full period. Similarly, financing long term assets with short term financing is costly as well as inconvenient as arrangement for the new short term financing will have to be made on a continuing basis. When the firm follows matching approach (also known as hedging approach) long term financing will be used to finance fixed assets and permanent current assets and short term financing to finance temporary or variable current assets. How ever, it should be realized that exact matching is not possible because of the uncertainty about the expected lives of assets. The firm fixed assets and permanent current assets are financed with long term funds and as the level of these assets in increases, the long term financing level also increases. The temporary or variable current assets are financed with short term funds and as their level increases, the level of short term financing also increases. Under matching plan, no short term financing will be used if the firm has a fixed current assets need only.

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Conservative approach

A firm in practice may adopt a conservative approach in financing its current and fixed assets. The financing policy of the firm is said to be conservative when it depends more on long term funds for financing needs. Under a conservative plan, the firm finances its permanent assets and also a part of temporary current assets with long term financing. In the period when the firm has no need for temporary current assets, the idle long term funds can be invested in the tradable securities to conserve liquidity. The conservative plan relies heavily on long term financing and, therefore, the firm has less risk of facing the problem of shortage of funds. The conservative financing policy is shown below.

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Aggressive Approach

A firm may be aggressive in financing its assets. An aggressive policy is said to be followed by the firm when it uses more short term financing than warranted by the matching plan. Under an aggressive policy, the firm finances a part of its permanent current assets with short term financing. Some extremely aggressive firms may even finance a part of their fixed assets with short term financing. The relatively more use of short term financing makes the firm more risky. The aggressive financing is illustrated in fig below.

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Short term v/s long term financing: A Risk Return Trade off A firm should decide whether or not it should use short term financing. If short term financing has to be used, the firm must determine its position in total financing. This decision of the firm will be guided by the risk return trade off. Short term financing may be preferred over long term financing. reasons: 1. The cost advantage 2. Flexibility. But short term financing is more risky than long term financing Cost: short term financing should generally be less costly than long term financing. It has been found in developed countries like USA, the rate of interest is related the maturity of debt. The relationship between the maturity of debt and its cost is called the
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For two

term structure of interest rates. The curve, relating to maturity of debt and interest rates, is called the yield curve. The yield curve may assume any shape, but it is generally upward sloping. Fig below shows the yield curve. The fig indicates that more the maturity greater the interest rate.

The justification for the higher cost of long term financing can be found in the liquidity preference theory. This theory says that since lenders are risk averse, and risk generally increases with the length of lending time (because it is more difficult to forecast the more distant future), most lenders would prefer to make short term loans. The only way to induce these lenders to lend for longer periods is to offer them higher rates of interest. The cost of financing has an impact on the firms return. Both short and long term financing have a leveraging effect on shareholders return. But the short term financing ought to cost less than the long term financing; therefore, it gives relatively higher return to shareholders. It is noticeable that in India short term loans cost more than the long term loans. Banks are the major suppliers of the working capital finance in India. Their rates of interest on working capital finance are quite high. The main source of long term loans are financial institutions which till recently were not charging interest at differential rates. The prime rate of interest rate charged by financial institutions is lower than the rate charged by banks.

Flexibility: it is relatively easy to refund short term funds when the need for funds diminishes. Long term funds such as debenture loan or preference capital cannot be refunded before time. Thus, if a firm anticipates that its requirement for funds will diminish in near future, it would choose short term funds. Risk: although short term financing may involve less cost, it is more risky than long term financing. If the firm uses short term financing to finance its current assets, it runs the risk of renewing borrowing again and again. This is particularly
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so in the case of permanent assets. As discussed earlier, permanent current assets refer to the minimum level of current assets which a firm should always maintain. If the firm finances it permanent current assets with short term debt, it will have to raise new short term funds as debt matures. This continued financing exposes the firm to certain risks. It may be difficult for the firm to borrow during stringent credit periods. At times, the firm may be unable to raise any funds and consequently, it operating activities may be disrupted. In order to avoid failure, the firm may have to borrow at most inconvenient terms. These problems are much less when the firm finances with long term funds. There is less risk of failure when the long term financing is used. Risk returned trade-off: Thus, there is conflict between long term and short term financing. Short term financing is less expensive than long term financing, but, at the same time, short term financing involves greater risk than long term financing. The choice between long term and short term financing involves a trade-off between risk and return.

1. HANDLING RECEIVABLES(DEBTORS) 2. MANAGING PAYABLES(CREDITORS) 3. INVENTORY MANAGEMENT 4. KEY WORKING CAPITAL RATIOS

HANDLING RECEIVABLES (DEBTORS) Cash flow can be significantly enhanced if the amounts owing to a business are collected faster. Every business needs to know who owes them money.... how much is owed.... how long it is owning.... for what it is owed. Late payments erode profits and can lead to bad debts.

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Slow payment has a crippling effect on business; in particular on small businesses who can least afford it. If you don't manage debtors, they will begin to manage your business as you will gradually lose control due to reduced cash flow and, of course, you could experience an increased incidence of bad debt. It is very difficult for the organization to sell always on cash basis in todays competitive market. In almost every business, we have to sell on credit basis. The basic objective of management of sundry debtors is to optimize the return on investment on this asset. It is obvious that if there are large amounts tied up in sundry debtors, working capital requirement would be high and consequently interest charges will be high. In such cases, the bad debts and cost of collection of debts would be high. On the other hand if the credit policy is very tight, investment in sundry debtors is low but the sale may be restricted, since the

competitors may offer more liberal credit term. We have limited resources and therefore every resource has its own opportunity cost. Therefore the management of sundry debtors is an important issue and requires proper policies and efficient execution of such policies. Debtors and cost of debtors have direct relation; cost will increase due to increase in debtors and vice-versa. It depends on the credit sale of concern and credit period (collection period) allowed to customer. It is interest of customer to pay as late as possible and company, who made sales, would like to collect their debtor as early as possible. There is a conflict between the two aspects. Debtor management is the process of finding the balance at which company agrees to receive its payment without hampering or having any adverse effect on its sales and customer agree to pay at their economical buying concept.

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Sundry debtor level depends on two measure issues: Volume of Credit sales Credit period allowed to customers.

Following factors may be considered before allowing credit period to the customer:1. Nature of product 2. Credit worthiness of the customer, which varies from customer to customer 3. Quantum of advance received from customers 4. Credit policy of company, say number of days allowed to customer for payment to the customers 5. Cost of debtors 6. Manufacturing cycle time of the product etc.

Credit policy: The term credit policy is used to refer to the combination of three decision variables: Credit standard are criteria to decide the types of customers to whom goods could be sold on credit. If a firm has more slow paying customers, its investment in accounts receivable will increase. The firm will also be exposed to higher risk of default. Credit terms specify duration of credit and terms of payment by customers. Investment in accounts receivables will be high if customers are allowed extended time period for making payments. Collection efforts determine the actual collection period. The lower the collection period, the lower the investment in accounts receivable and vice-versa.

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Credit Policy Variables These are: 1. Credit standers and analysis 2. Credit terms 3. Collection policy and procedures The financial manager or the credit manager may administer the credit policy of a firm. Credit policy has important implications for the firms production, marketing and finance functions. The impact of changes in the major decision variables of credit policy are:

Credit standards These are the criteria which a firm follows in selecting customers for the purpose of credit extensions. The firm may have tight credit standards; that is, it may sell mostly on cash basis and may extend credit only to the most reliable and financially strong customers. Such standards will result in no bad debt losses and less cost of credit administration. But the firm may not be able to expand sales. The profit sacrificed on lost sales may be more than the costs saved by the firm. On the contrary, if credit standards are loose, the firm may have larger sales. But the firm will have to carry large receivables. The cost of administrating credit and bad debt losses will also increase. Thus, the choice of optimum credit standards involves a trade-off between incremental return and incremental costs. Credit analysis: Credit standards influence the quality of the firms customers. There are two aspects of the quality of customers; (I) The time taken by customers to repay credit obligation and (II) The default rate. The average collection period determines the speed of payment by customers. It measures the number of days for which credit sales remain
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outstanding. The longer the average collection period, the higher the firms investment in accounts receivables. Default rate can be measured in terms of bad debt losses ratio.-the proportion of uncontrolled receivable. Bad debt losses ratio indicates default risk. Default risk is the likelihood that a customer will fail to repay the credit obligation. On the basis of past practice and experience; the finance manager should be able to form a reasonable judgment regarding the chance of default. To estimate the probability of default, the financial or credit manager should consider: Character refers to the customers willingness to pay. The financial or credit manager should judge whether the customers will make honest efforts to honor their credit obligations. The moral factor is of considerable importance in credit evaluation in practice. Capacity refers to the customers ability to pay. Ability to pay can be judged by assessing the customers capital and assets which he may offer as security. Capacity is evaluated by the financial position of the firm as indicated by analysis of ratios and trends in firms cash and working capital position. The financial or credit manager should determine the real worth of assets offered as security. Condition refers to the prevailing economic and other conditions which may affect the customers ability to pay. Adverse economic conditions can affect the ability or willingness of a customer to pay. The firm may categorize its customers at least in the following three categories: 1. Good accounts; financially strong customers 2. Bad accounts; financially very weak, high risk customers. 3. Marginal accounts; customers with moderate financial health and risk.

Credit terms: the stipulations under which the firm sells on credit to customers are called credit terms. These stipulations include (A) credit period (B) cash discount. Credit period: the length of time for which credit is extended to customers is called the credit period. It is generally stated in term of a net date. A firms credit
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period may be governed by the industry norms. But depending on its objectives the firm can lengthen the credit period. On the other hand, the firm may tighten its credit period if customers are defaulting too frequently and bad debts losses are building up. Cash discount: it is a reduction in payment offered to customers to induce them to repay credit obligations within a specified period of time, which will be less than the normal credit period. It is usually expressed as a percentage of sales. Cash discount terms indicate the rate of discount and the period for which it is available. If the customer does not avail the offer, he must make payment within the normal credit period. A firm uses cash discount as a tool to increase sales and accelerate collections from customers. Thus, the level of receivables and associated costs may be reduced. The cost involved is the discounts taken by customers.

Collection policy and procedures A collection policy is needed because all customers do not pay the firms bill in time. Some customers are slow payers while some are non-payers. The collection efforts should, therefore, aim at accelerating collections from slowpayers and reducing bad-debt losses. A collection policy should ensure prompt and regular collection. Prompt collection is needed for fast turnover of working capital, keeping collection costs and bad debts within limits and maintaining collection efficiency. The collection policy should lay down clear cut collection procedures. The collection procedures for past dues or delinquent accounts should also be established in unambiguous terms. The slow paying customers should be handled very tactfully. Some of them may not be permanent customers. The firm should decide about offering cash discount for prompt payments. Cash discount is a cost to the firm for ensuring faster recovery of cash. Some customers fail to pay within the specified discount period, yet they may make
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payment after deducting the amount of cash discount. Such cases must be promptly identified and necessary action should be initiated against them to recover the full amount.

MEASUREMENTS OF DEBTORS: The following measures will help manage your debtors: 1. Have the right mental attitude to the control of credit and make sure that it gets the priority it deserves. 2. Establish clear credit practices as a matter of company policy. 3. Make sure that these practices are clearly understood by staff, suppliers and customers. 4. Be professional when accepting new accounts, and especially larger ones. 5. Check out each customer thoroughly before you offer credit. Use credit agencies, bank references, industry sources etc. 6. Establish credit limits for each customer... and stick to them. 7. Continuously review these limits when you suspect tough times are coming or if operating in a volatile sector. 8. Keep very close to your larger customers. 9. Invoice promptly and clearly. 10. Consider charging penalties on overdue accounts. 11. Consider accepting credit /debit cards as a payment option. 12. Monitor your debtor balances and ageing schedules, and don't let any debts get too large or too old. Recognize that the longer someone owes you, the greater the chance you will never get paid. If the average age of your debtors is getting longer, or is already very long, you may need to look for the following possible defects:

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1. Weak Credit Judgment 2. Poor Collection Procedures 3. Lax Enforcement Of Credit Terms 4. Slow Issue Of Invoices Or Statements 5. Errors In Invoices Or Statements 6. Customer Dissatisfaction. Debtors due over 90 days (unless within agreed credit terms) should generally demand immediate attention. Look for the warning signs of a future bad debt. The act of collecting money is one which most people dislike for many reasons and therefore put on the long finger because they convince themselves there is something more urgent or important that demand their attention now. There is nothing more important than getting paid for your product or service. A customer who does not pay is not a customer. Here are a few ideas that may help you in collecting money from debtors: 1. Develop appropriate procedures for handling late payments. 2. Track and pursue late payers. 3. Get external help if your own efforts fail. 4. Don't feel guilty asking for money.... its yours and you are entitled to it. 5. Make that call now. And keep asking until you get some satisfaction. 6. In difficult circumstances, take what you can now and agree terms for the remainder. It lessens the problem. 7. When asking for your money, be hard on the issue - but soft on the person. Don't give the debtor any excuses for not paying. 8. Make it your objective is to get the money - not to score points or get even.

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MANAGING PAYABLES (CREDITORS) Creditors are the businesses or people who provide goods and services in credit terms. That is, they allow us time to pay rather than paying in cash. There are good reasons why we allow people to pay on credit even though literally it doesn't make sense! If we allow people time to pay their bills, they are more likely to buy from your business than from another business that doesn't give credit. The length of credit period allowed is also a factor that can help a potential customer decides whether to buy from your business or not: the longer the better, of course. In spite of what we have just said, creditors will need to optimize their credit control policies in exactly the same way that we did when we were assessing our debtors' turnover ratio - after all, if you are my debtor I am your creditor! We give credit but we need to control how much we give, how often and for how long. The formula for this ratio is: Average Creditors Creditors' Turnover = (Cost of Sales/365)

Creditors are a vital part of effective cash management and should be managed carefully to enhance the cash position. Purchasing initiates cash outflows and an over-zealous purchasing function can create liquidity problems. Consider the following: 1. Who authorizes purchasing in your company - is it tightly managed or spread among a number of (junior) people? 2. Are purchase quantities geared to demand forecasts?

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3. Do you use order quantities which take account of stock-holding and purchasing costs? 4. Do you know the cost to the company of carrying stock? 5. Do you have alternative sources of supply? If not, get quotes from major suppliers and shop around for the best discounts, credit terms, and reduce dependence on a single supplier. 6. How many of your suppliers have a returns policy? 7. Are you in a position to pass on cost increases quickly through price increases to your customers? 8. If a supplier of goods or services lets you down can you charge back the cost of the delay? 9. Can you arrange (with confidence!) to have delivery of supplies staggered or on a just-in-time basis? There is an old adage in business that if you can buy well then you can sell well. Management of your creditors and suppliers is just as important as the management of your debtors. It is important to look after your creditors - slow payment by you may create ill-feeling and can signal that your company is inefficient (or in trouble!). Remember, a good supplier is someone who will work with you to enhance the future viability and profitability of your company. INVENTORY MANAGEMENT

Inventories constitute the most significant part of current assets of a majority of companies in India. On an average, inventories are approximately 60 percent of current assets in public limited companies in India. Because of the large size of inventories maintained by firms, a considerable amount of funds is required to be committed to them. It is, therefore, absolutely imperative to manage inventories efficiently and effectively in order to avoid unnecessary investment. A firm
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neglecting the management of inventories will be jeopardizing its long run profitability and may fail ultimately. It is possible for a company to reduce its level of inventories to a considerable degree, e.g., 10 to 20 per cent, without any adverse effect on production and sales, by using simple inventory planning and control techniques. The reduction in excessive inventories carries a favorable impact on companys profitability.

Nature of Inventories Inventories are stock of the product a company is manufacturing for sale and components that make up the product. The various forms in which inventories exist in a manufacturing company are: Raw Materials: These are those basic inputs that are converted into finished product through the manufacturing process. Raw materials inventories are those units which have been purchased and stored for future productions. Work in Process: These inventories are semi-manufactured products. They represent products that need more work before they become finished for sale. Finished Goods: These inventories are those completely manufactured products which are ready for sale. Stocks of raw materials and work-in-process facilitate production, while stock of finished goods is required for smooth marketing operations. Thus, inventories serve as a link between the production and consumption of goods.

The levels of three kinds of inventories for a firm depend on the nature of its business. A manufacturing firm will have substantially high levels of all three kinds of inventories. Within manufacturing firms, there will be differences. Large heavy engineering companies produce long production cycle products; therefore they carry large inventories. Firms also maintain a fourth kind of inventory,
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supplies or stores and spares. Supplies include office and plant cleaning materials like soap, brooms, oil, fuel, light bulbs etc. these materials do not directly enter production, but are necessary for production process. Usually, these supplies are small part of the total inventory and do not involve significant investment. Therefore, a sophisticated system of inventory control may not be maintained for them.

Need To Hold Inventories The question of managing inventories arises only when the company holds inventories. Maintaining inventories involves tying up of the companys funds and incurrence of storage and handling costs. If it is expensive to maintain inventories, why do companies hold inventories? There are three general motives for holding inventories:TRANSCATIONS MOTIVE: It emphasizes the need to maintain inventories to facilitate smooth production and sales operations. PRECAUTIONARY MOTIVE: It necessitates holding of inventories to guard against the risk of unpredictable changes in demand and supply forcs and other factors. SPECULATIVE MOTIVE: It influences the decision to increase or reduce inventory levels to take the advantage of price level fluctuations.

A company should maintain adequate stock of materials for a continuous supply to the factory for an uninterrupted production. It is not possible for a company to procure raw materials whenever it is needed. A time lag exists between demand for materials and its supply. Also, there exists uncertainty in procuring raw materials in time on many occasions. The procurement of materials may be delayed because of such factors as strike, transport disruption or short supply.
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Therefore, the firm should maintain sufficient stock of raw materials at a given time to stream line production. Other factors which may necessitate purchasing and holding of raw materials inventories are quantity discounts and anticipated price increase. The firm may purchase large quantities of raw materials than needed for the desired production and sales levels to obtain quantity discounts of bulk purchasing. At times, the firm would like to accumulate raw materials in anticipation of price rise. Work in process inventory builds up because of the production cycle. Production cycle is the time pan between introduction of raw materials into production and emergence of finished product at the completion of production cycle. Till production cycle completes, stock of WIP has to be maintained. Stock of finished goods has to be held because production and sales are not instantaneous. A firm cannot produce immediately when customers demand goods. Therefore, to supply finished goods on a regular basis, their stock has to be maintained.

Objective of Inventory Management

In the context of inventory management, the firm is faced with the problem of meeting two conflicting needs: 1. To maintain a large size of inventories of raw materials and WIP for efficient and smooth production and of finished goods for uninterrupted sales operations. 2. To maintain a minimum investment in inventories to maximize profitability. Both excessive and inadequate inventories are not desirable. These are two danger points which the firm should avoid. The objective of inventory management should be determine and maintain optimum level of inventory

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investment. Te optimum level of inventory will lie between the two danger points of excessive and inadequate inventories. The firm should always avoid a situation of over investment or under investment in inventories. The major dangers of over investment are: Unnecessary tie up of the firms funds loss of profit Excessive carrying costs Risk of liquidity

The excessive level of inventories consumes funds of the firm, which cannot be used for any other purpose, and thus, it involves an opportunity cost. The carrying costs such as the costs of storage, handling, insurance, recording and inspection, also increases in proportion to the volume of inventory. These costs will impair the firms profitability further. Excessive inventories carried for long period increases chances of loss of liquidity. It may not be possible to sell inventories in time and at full value. Raw materials are generally difficult to sell as the holding period increases. Another danger of carrying excessive inventory is the physical deterioration of inventories while in storage. Maintaining an inadequate level of inventories is also dangerous. The consequences of under investment in inventories are Production hold-ups Failure to meet delivery commitments Inadequate raw materials and WIP inventories will result in frequent production interruptions. The aim of inventory management is to avoid excessive and inadequate levels of inventories and to maintain sufficient inventory for the smooth production and sales operations. An effective inventory management should: Ensure a continuous supply of raw materials to facilitate uninterrupted production Maintain sufficient stock of raw materials in periods of short supply and anticipate price changes.
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Maintain sufficient finished goods inventory for smooth sales operation and efficient customer service. Minimize the carrying cost and time Control investment in inventories and keep it at an optimum level.

Following steps have been taken to control inventory:

An inventory monitoring cell is constituted at the corporate office. The purchases were controlled by the materials management group reporting to the Director of Finance. The company provided for weekly meetings between material planning, production control and purchase departments for better matched material availability.

Monthly review of total inventory at the level of chief executives of plants and corporate management is introduced. Inventory control is dovetailed with the budgeting system.

Ratio

Formulae

Interpretation On average, you turn over the value of your entire stock every x days. You may need to

Stock Turnover (in days)

Average Stock * 365/ break this down into product groups for effective Cost of Goods Sold stock management. Obsolete stock, slow moving lines will extend overall stock turnover days. Faster production, fewer product lines, just in time ordering will reduce average days.

Receivables (Debtors*365)/Sales It take you on average x days to collect monies Ratio due to you. If your official credit terms are 45

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(in days)

day

and

it

takes

you

65

days...

why?

One or more large or slow debts can drag out the average days. Effective debtor management will minimize the days. On average, you pay your suppliers every x days. If you negotiate better credit terms this will Payables Ratio (in days) Creditors * 365/ Cost of Sales (or Purchases) increase. If you pay earlier, say, to get a discount this will decline. If you simply defer paying your suppliers (without agreement) this will also increase - but your reputation, the quality of service and any flexibility provided by your suppliers may suffer. Current Assets are assets that you can readily turn in to cash or will do so within 12 months in the course of business. Current Liabilities are amount you are due to pay within the coming 12 Current Ratio Total CA/ Total CL months. For example, 1.5 times means that you should be able to lay your hands on $1.50 for every $1.00 you owe. Less than 1 time e.g. 0.75 means that you could have liquidity problems and be under pressure to generate sufficient cash to meet oncoming demands. (Total CA - Inventory)/ Total CL Similar to the Current Ratio but takes account of the fact that it may take time to convert inventory into cash.

Quick Ratio

Working Capital Ratio

(Inventory + Receivables Payables)/ Sales A high percentage means that working capital needs are high relative to your sales.

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CURRENT RATIO: CURRENT RATIO CURRENT ASSET CURRENT LIABILITY CURRENT ASSET CURRENT LIABILITY RATIO

27141 20824
1.3033

QUICK RATIO: QUICK RATIO C.A.-INVENTORY C.L. C.A.-INVENTORY CURRENT LIABILITY RATIO 17130 20824 0.8226

STOCK TURNOVER RATIO:

STOCK TURNOVER RATIO AVG. STOCK COST OF GOODS SOLD RATIO

AVERAGE STOCK * 365 COST OF GOODS SOLD

9884 14558
247.8 (Days)

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