Heli Juhi Presentation

8/3/2019 Heli Juhi Presentation

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RECENT TRENDS IN PRESENTATION OF

FINANCIAL STATEMENT

Presented by:-

Heli Modi

Juhi AgrawalKrishna Iyer

Sagar Parmar


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Financial Statements

Financial statements provide information aboutthe financial activities and position of a firm.

Important financial statements are:-

Balance sheet

Profit & Loss statement

Funds flow statement

Cash flow statement


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Purpose And Status

Assist prepares of financial statements in

applying accounting standards,

Assist the accounting standards Board in the

development of future accounting standards,

Assist auditors in forming an opinion


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To show the results of the stewardship or the

accountability of management for the resources

entrusted into it.


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Main matter is printed in Black ink, but

coloured ink are also used by many companies.

Typography is applied most carefully, many

titles of balance sheet and profit n loss a/c are

given in bold types.

Many companies use Logos on top of everypage.


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E.g.

96th ANNUAL REPORT 2002-2003 TATA

STEEL

OR

HINDUSTAN LEVER LIMITED

REPORT AND ACCOUNTS,2002


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Index or contents

Most of companies at start give index of index

of details inside the reports.

E.g.,

Tata Iron and Steel company Ltd.,

I.T.C. Ltd.,

Bata India Ltd.,Hindustan Lever Ltd., on first page give

only an index.


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Whereas,

Reliance Industries Ltd.,

Indian Aluminum Co. Ltd. &

Tata Press Ltd. give no index.

Raymond Ltd.,

Ashok Leyland ltd. & others

In half a page give an index & in the other half

give names of directors, auditors & address of itsregistered office.


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Name of Directors or Management

Team

Companies mostly on the first and second inside

page give-

names of directors, solicitors, names of

bankers, details of head office, registered office,

transfer agents and others.

Many companies give names and coloured

photographs of management team or directors.


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Financial Highlights or Facts at a

glance

In order to draw the attention of shareholders and public,

highlights of years working or financial review are

given.

Some companies present financial review or progressunder following headings:

1) Facts at a Glance

2) The Year in Review

3) Facts in Nutshell

4) Digests of Results. E.g. Raymond Ltd.


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Notice of Annual General Meeting

Companys annual report is to be presented inthis meeting.

Every company adopt different methods.

E.g :-

Century Textile and Industries Ltd.,

Bata India Ltd., etc,

printed their notice along with their annual

report itself.


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Britannia India Ltd.,

ITC Ltd.,

Spic Ltd.,

Tata Iron and Steel Company Ltd.,

Steel Authority of India, have printed

notice separately.


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Chairmans Statement

Statements or speech is included by most

companies in their annual reports.

They also print it as a part of the report.

Various activities of a company are describedin details in these speech.


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Directors Report

According to Section 217 of companys act

director should include details

Some of them are:-i. Financial Results,

ii.Appropriation of profit to Reserves,

iii.Recommendation of Dividend,

iv.Production and Sales

v. Troubles encountered ,etc


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Acc. to Sec. (22A)

Boards report shall include DirectorsResponsibility Statement indicating:-

I. Proper explanation relating to materialdepartures.

II. Selecting such accounting policies andapply them so that to give true and fair view

of the state of affairs


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III. Proper and sufficient care for the

maintenance of adequate accounting records

in accordance with the provisions of this act

for the safeguard of the assets of thecompany.

IV. Prepare the annual accounts on a goingconcern basis.


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Auditors Report

Acc. sec 227(2) of Companies Act, the auditor

of a company has to make a report on balance

sheet and p&l a/c.,for shareholders.

It should be stated that has obtained all the

information and explanations.


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Under powers obtained from companies act,

the central govt.promulgated manufacturing

and other companies(auditors report) order in1988.

The order should state that certain mattersshould be mentioned in it manufacturing and

other specified companies.


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Balance sheet

According to law:-

A company has to present previous years

figures in it.

Many companies print current years figure in

bold letters or vertical light coloured screen stripe

and some in different coloured ink.

ISPAT INDUSTRIES LIMITED


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BALANCE SHEET

AS AT 31ST MARCH, 2001 Rs crore

2001 2000

SOURCES OF FUNDS

1. Shareholders' Funds

Share Capital 978.07 901.55

Advances against Share Capital 244.3 96.46

Reserves & Surplus 746.77 874.08

1969.14 1872.09 2. Loan Funds

Secured Loans 4989.26 3582.6

Unsecured Loans 630.09 1088.29

5619.35 4670.89

TOTAL 7588.49 6542.98

APPLICATION OF FUNDS

1. Fixed Assets

Gross Block 3470.36 1640.28

Less: Depreciation 704.01 498.14

Net Block 2766.35 1142.14

Capital Work -in-Progress 2093.31 2740.66

Pre-operative exp. etc. 1715.74 2231.85

6575.4 6114.65

2. Investments 130.87 135.79

3. Current Assets, Loans & Advances

Inventories 257.37 259.48

Sundry Debtors 389.69 250.4

Cash & Bank Balances 53.9 77.7

Loans, Advances & Deposits 1018.31 907.611719.27 1495.19

Less: Current Liabilities & Provisions

Liabilities 1150.7 1185.39

Provisions 18.86 18.61

1169.56 1204

Net Current Assets 549.71 291.19

4. Miscellaneous Expenditure 134.37 1.35

(To the extent not written off or adjusted)

5. Profit and Loss Account Debit balance 198.14 _ TOTAL 7588.49 6542.98


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Profit and loss account

A for of balance sheet is given in schedule VI

of companies act 1956,but not of a profit and

loss a\c.

It has been made compulsory to present certain

details which the companies can present intheir own way.



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PROFIT AND LOSS ACCOUNT

FOR THE YEAR ENDED 31ST MARCH

2001 2000

INCOME

Sales & Job Work (Net) 2238.89 1425.48

Other Income 25.18 11.65TOTAL (A) 2264.07 1437.13

EXPENDITURE 3.95 33.7

Decrease in stocks 3.95 33.7

Raw Materials Consumed 823.04 778.15

Purchases of Finished Goods 7.77 9.32

Payments to & Provisions for Employees 43.99 21.79

Excise Duty 269.94 118.83

Mfg., Dist., Sell. & Admin. Expenses 890.84 306.72Interest & Finance Charges 345.96 100.13

Depreciation 206.33 79.89

Less: Transfer from Revaluation Reserve 15.32 15.32

TOTAL (B) 2576.5 1433.21

Profit/(Loss) before Taxation (A+B) 312.43 3.92

Less: Provision for Taxation 0.03 0.32

Add: Provision for Taxation written back 0.07

Profit/(Loss) after taxation 312.46 3.67

Less: Balance brought forward from Previous Year 100.52 106.59

Transfer from Debenture Redemption Reserve 8.09

Transfer from Taxation Reserve 0.73

Transfer from General Reserve 13.07 _

Profit/(Loss) available for appropriation -198.14 118.35

APPROPRIATIONS:

Transfer to Debenture Redemption Reserve _ 17.83

Balance carried to Balance Sheet -198.14 100.52

TOTAL -198.14 118.35

(Rs. crores)


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Fund flow statement

A statement is prepared showing the sources aswell as the application of funds.

Most companies attach such statements with

annual reports

This statement is prepared to show fund changes

between two reports.


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NOTE :-

According to revised standar-3 every

Indian every company has to present its cash

flow statement in place of fund flow statement

.


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Cash flow statement

This is a statement showing cash received &

cash spent during an year.

Generally most companies present cash flow

statement with financial statements.

Indian C.A institute by modifying Accounting

standard 3 has made it compulsory to present

this statement with B/S & P & L a/c


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NOTE:-

Only changes in cash that has taken

place during the year are considered.


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Following are the companies which have

presented Cash Flow Statement in their annual

a/c Hindustan lever ltd

Reliance industries ltd

Raymond ltd Tata engineering & Locomotive Co. ltd

Tata Chemicals ltd

Philips India ltd

I.F.C.I LTD


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Sources and Uses of Funds and Cash

Flows

Sources of funds or cash flows:-

funds from operations

sale of fixed assets

issue of share capital

borrowings

Uses of funds:-

losses

purchase of fixed assets

repayment of borrowings

payment of dividends


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Accounting Ratios

Companies gives information on important

accounting ratios in annual reports.

Useful to prospective investors, shareholders,

creditors, govt. & others.

Companies profitabilty, liquidity, efficiency

can be known.


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These includes :-

1.Return on equity capital

2.Earning per share3.Dividend coverage

4.% of dividend

5.Book value of equity share6.Profitability

7.Capital turnover

8.Stock turnover9.Turnover of working capital

10.Current ratio


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Inflation Accounting

It is desirable that changes should be made

according to the changes in price level.

Fixed assets are shown at their original cost

lesss depreciation

Current assets like stock are shown at market

or cost whichever is less

All transactions which have taken place during

the year are shown at their price at that time.


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While preparing a.c changes in the prices are to

be considered to show a stable condition.

Depreciation is calculated on original cost of anasset.

To show changes in price level, a separate

statement is prepared. According to modern trends many companies

attach inflation accounts with financial statement.

E.g:- Bhel ltd


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Human resource accounting

Employees of the company being valuable assetsits is needed that their value should be presented

in accounts.

Following companies presented human resourceaccounting with their annual reports

A.C.C ltd

H.M.T ltd

The mineral & metal trading corporations

Project & equipment corp of India etc


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Heli Juhi Presentation