21

Managerial Accounting (MAC) – IPROJECT

Ramco Industries LimitedANNUAL REPORT STUDIED: FY

2013-14 & FY 2012-13

Submitted To: Submitted By:Prof. Parag Rijwani

Pulkit Jain (141336) Section-C

MBA-FT (I)

Basics of Business

21

1. What is the company’s business? Explain in about 300 words.

Ramco Industries Limited, a part of Ramco group was formed on 1967 by P.A.C Ramaswamy Raja. It is one of the best performing, highly efficient producers of the Fibre cement sheets in India and is the market leader. Company has introduced the innovative calcium silicate board, a versatile building interior product in India. Company’s first sheet plant was opened in Arakkonam and from the product has been updated continuously. They also hold the distinction of being the first company in India to introduce pipes of 5m length whose diameter is above 600 mm.

They have the production units in southern and western parts of India. The turnover of the company is around 300 Crores with total number of employees around 1500. The entire work cycle from the raw material to the sheet formation is done under pollution free environment across all the factories. The company has also set up its most advanced plant in Sri Lanka. It has succeeded in building a nationwide dealer network and has a strong customer base among architect and builders.

Other units of Ramco Industries are Ramco cements which are also known as Madras cements. It is the most popular brand in the southern part of India. The company is the fifth largest cement producer in the country. Other unit of Ramco group is Ramco Systems the working of this company is to focus on providing innovative solutions that can be delivered quickly and cost effective in complex environments. It is formed in 1992 and at present it is working in 15 cities of India, US, Canada; Middle East, Europe and Africa. Their other units deals in the business of textiles, energy , cotton spinning and biotechnology.

2. What are its main products and services? Name some of the company’s brands, if any.

The product lines of Ramco Industries are as follows:

a. Ramco fiber cement roofing sheetsb. Ramco roofing accessoriesc. Ramco Hilux Calcium Silicate Boardd. Ramco Fiber Cement pressure pipe.e. Ramco Concrete

3. Who are likely to be company’s major suppliers?

The major suppliers of industry are:

National thermal power corporation for supplying ash Gas authority of India Limited for supply gas approx. 80000cubic metre per day Oil and Natural gas corporation for supplying approx. 25000 cubic metre per day

21

4. Who are likely to be the company’s major customers? Does the company export its products? To which countries?

Company’s major customers are:

a. Vallaepadam Terminalb. BPCLc. Chennai metro raild. BHELe. Simplexf. Skylineg. ECCI Tamil Nadu assembly project

Company exports their product also in the countries like Sri Lanka, Nepal, and Italy and in some Gulf countries also.

5. How many employees does it have? Why is this information important?

The company currently employs 2000 employees. The number is important because it affects an operating performance ratio that measures the revenue of the company per employee. It has help knowing the productivity level of the employee.

Annual Report

6. Read the ‘Contents’ page. Mark the items that relate to financial statements as ‘FS’ (Financial Statement) and the rest as ‘NFS’ (Non-Financial Statement). What information does the company provide in items that you have marked as ‘NFS’? Is this information useful? How? Who is the intended audience? Will they be able to understand the information? Give highlights of ANY THREE major ‘NFS’ items.

Financial Statement Non- financial Statement

Financial Highlights Notice to Members Directors Report Corporate Governance Report Financial statement Auditor’s report on financial statement Consolidated Financial Statements Proxy Form

Non Financial Statements cover all the non-financial and relevant information from an investor’s perspective. It includes the details of all the board of directors, auditors and relevant parties,

21

responsibilities assumed by them, change in policies that might affect the financial outcome and other such information.Yes, this information is of equal importance as the financial statements as they provide the reasons behind the changes, implications and differences in the financial reports. This information is of utmost use for regulatory authorities along with the rest of the stakeholders. Yes, the information has been supplied in simple language even while referring to the laws that the policy change applies to.

The following are key NFS items mentioned in the report:

Notice to members – it contains the agenda of the annual general meeting. The modification which are proposed by the management, the issues which are raised by the stakeholders and which are needed to be resolved.

Corporate Governance Report – It tells about the steps taken by the company for safeguarding the interest of the stakeholders and the code of conduct laid down for that purpose.

Auditors Report – It contains the responsibilities of the auditors and management. It tells about the opinion of the auditor about the company’s financial position and what recommendation he has for the company.

7. When was the annual general meeting to be held? What are the items to be discussed?

The annual general meeting held on July 28, 2014 at 11:00 am in Rajapalayam, Tamil Nadu. The key facts which were discussed were:

Ordinary Business – To receive and consider the profit and loss statement and the balance sheet. Declaration of dividend for the year 2013-2014. Appointment of director in place of the retired one. They also discussed regarding appointing of the Auditor and one resolution is passed that in 2014-2015, 2015-2016 each auditor will get Rs. 350000 as remuneration excluding out of pocket expense and from 2017 the remuneration will be fixed.

Special Business – the items which were discussed under this category are as follows :

a) Change in the article 16A of Article of Association under which now board of director can appoint anyone among themselves as a managing director.

b) Appointment of Shri P.R. Venketrama Raja as a Vice Chairman and Managing Director. His tenure will be 3 years. As remuneration he will get 5% of the net profit of the company.

c) Appointment of Shri R.S. Agarwal as an independent director for the term of 5 year i.e. from 2014-2019. The resolution was passed also as it got support from all the members.

21

d) Appointment of Shri M.B.N Rao who at present is addition director on the post of the Director of the company for 3 years but the member proposed him to appoint as an independent director for 5 consecutive years, the resolution was passed also.

e) Appointment of another director Shri K.T. Ramachandran who is also retiring this year due to the rotation policy. It has been proposed that he should also be appointed as an independent director for the consecutive term of 5 years.

f) Another recommendation which was resolved also regarding bank loan which should not exceed by Rs. 125 crore or above the aggregates of the paid up capital and capital reserves.

g) This recommendation is regarding company CSR practices, under this it has been proposed that the budget should not be more than Rs. 6 Crore or 5% of the total net profit of last 3 financial years, whichever is greater for the next financial year.

Financial Reports

8. Identify the company’s reporting entities.

Company’s reporting entities are the board of directors of the company. These are those who look after the day to day affairs of the company. The list is as follows.

Sr. No. Name of Director Directorship

1 Shri P.R. Ramashubramaneya Rajha Chairman 2 Shri Venkatrama Raja Vice Chairman & M.D 3 Shri S.S. Ramachandra Raja Director 4 Shri N.K. Shrikantan Raja Director 5 Shri V Santharaman Director 6 Shri K.T. Ramchandran Independent Director 7 Shri R.S. Agarwal Independent Director 8 Smt. Chitra Venkatraman Independent Director

9. How is the information in the notes to the financial statements useful? Give five examples of how the notes explain the items in the financial statement.

21

The notes to financial statement basically contain information on practices followed by the company and in accordance with which principle. These policies have a major impact on the company’s financials. Five examples of notes that explain treatment of certain transactions in the financial statements are as follows:

1. Basis of preparation and presentation of financial statements: The Company follows historical cost method which explains the treatment of assets which are valued at cost of purchase.

2. Use of estimates: The notes state that calculations regarding certain items are based on estimates and assumptions that are made by the management. For example, life of fixed assets, beneficial period of intangible assets etc.

3. Tangible fixed assets: The details under this head include the amortisation policy of tangible fixed assets owned by the company

4. Inventories: It states that inventory is being computed on a moving weighted average basis

5. Revenue Recognition policy: The policy of the company is to recognise revenue when significant amount of risks and rewards have been transferred to the buyer and when the company establishes its right to receive revenue.

10. Identify any three matters covered by the accounting policies and write their Current year balances.

Three matters covered by accounting policies and their ending balances are:

i. Investment - Rs.20,329 Lakhii. Inventory - Rs. 22,094 lakh

iii. Fixed assets - Rs. 37,573 Lakh

11. Who is responsible for the information in the financial statements?

Financial reports are made by the management of the company. it is made under the leadership of Chairman Shri P.R. Ramashubramaneya Rajha and M.D Shri Venkatrama Raja.

12. Think of information that you think would be useful but not disclosed in the financial statements. Why do you think the information is not disclosed?

Fraudulent financial reporting is defined as intentional or reckless reporting, whether by act or by omission, that results in materially misleading financial statements. Fraudulent financial reporting can usually be traced to the existence of conditions in either the internal environment of the firm (e.g., inadequate internal control), or in the external environment (e.g., poor industry or overall business conditions). Excessive pressure on management, such as unrealistic profit or other performance goals, can also lead to fraudulent financial reporting.

13. Think of information not reported in the financial statements but would be available internally.

21

Think of information which are not reported in the financial statement but would be available internally would be Credit sale, employee’s salary.

Auditors

14. Who are the company’s auditors?

Mr. M.S Jagannathan & N. Krishnaswami, Firm RegNo. - 001208SM/s CNGSN & Associates, Firm No. – 004915S

15. To whom is the auditor report addressed and why?

The report has been addressed to all those people who are linked to company in any monetary way. Those people are company board of directors , shareholders, customers, creditors, government authorities like Income Tax and other regulatory authorizes. Financial institutions like bank who had given loan to them or invested in the company.

16. List the main items on which the auditors report. Give details of three items that significantly affect the financial statements.

Auditors report on three statements which are Profit &loss statement, balance sheet and Cash flow statement. They see that the cash flow and profit & loss statement has been prepared properly. Management has shown or cover every business transaction which they had done in the financial year or not in the balance sheet. They verify all the data in these statements and they give their certificate that accounts are clear, and if they found any illegal activity and they are not satisfied with the response of the management than they also points out that thing in the auditor’s report.

17. How much was the auditor’s remuneration? Give the detailed breakup of the same.

The detailed remuneration of the auditor has been given below

Statutory Auditors (Fig. In crores)As Auditors 0.5For Taxation Matters 0.02Other Certification Work 0.03

For Reimbursement of Expenses

0.04

Cost Auditors As Auditors 0.02Total 0.26

21

18. Highlight the concerns raised by the auditors in their report. Give details of such items.

No such concerns have been raised by the auditors in their reports. They are completely satisfied with the working and all the monetary transaction which came towards them for verification. They didn’t find any illegal transaction in the books of account.

Statement of Profit&Loss

19. What are the company’s major items of revenues? How these items have changed in

percentage terms as compared to the previous financial year?

Major items of revenues in 2013-2014 period

Items of revenue Amount in (lakh) % change from previous year

Sales Revenue Rs. 72878.86 (14.65) Net Revenue Rs. 66004.42 (14.33) Industrial Promotion Assistance

Rs. 600.68 (31.42)

Income from Wind Power Generation

Rs.257.41 (8.25)

20. State the revenue recognition policy of the company for sales revenue.

Revenue Recognition policy Revenue of the sale of goods is recognized when all the significant risks are

transferred to the buyer as terms of the contract. Other income is recognized on the accrual basis as and when the right to receive

arises. Dividend income is accounted in the period in which the right to receive the same

is established. Interest income on deposits is recognized at the agreed rate on time proportion

basis.

21

21. Identify the sources of company’s gains and other non-operating income. What is the proportion of these items in relation to the total income and Net Profit after Tax?

Other non operating income for (2013-2014)

Sr. No. Source of Income Amount (Lakh)

% of total Income

% of Net profit after tax

1 Interest Income Rs. 70.63 0 .10 11.772 Dividend Income Rs. 587.63 0 .84 97.99 3 Dividend Income from

SubsidiariesRs. 15.96 0.023 2.66

4 Other Miscellaneous Income

Rs. 342.20 0.49 57.06

5 Carbon Credit Rs. 10.97 0.016 1.836 Royalty Rs. 1314.32 1.89 219.17

22. Locate any references to accounting principles related to revenues in the financial statements and related information. Write the details of the same.

The notes forming part of the financial statements mention the revenue recognition policy of the company regarding:

a. Products - Revenue on the sale of goods is recognized when all significant risk and reward are transferred toward the purchaser from seller.

b. Other Income – Revenue on other income is recognize on accrual basis as and when the right to receive arises.

c. Dividened- it is accounted in the year when it realizes.

23. When does the company recognize revenue from services? Why?

Company recognize income from services as in the case of Income from Wind Mill – Under the wheeling and banking management:

Units generated from windmills are adjusted against the consumption of power at our factories. Whereas under the purchase power agreement, units which are generated from windmills are sold to State electricity Board at agreed rates and the income is included in Value of power generated from wind farm.

24. When does the company recognize dividend income? Why?

21

Revenue recognition for dividend income is recognized when the company’s right to receive dividend is established.

25. What are the major items of expenses? How these items have changed in percentage terms as compared to the previous financial year? Major items of expenses are as follows:

Sr. No. Source Of Expenses Amount (lakh) % change in compare to previous year

1 Cost of material consumed Rs.41096.34 (19.04)2 Cost of resale material Rs.161.99 (75)3 Change in inventories Rs. 2247.33 153.254 Employees benefit scheme Rs.4713.92 10.955 Depreciation and amortization Rs.4324.95 30.36

26. Identify the company’s losses and other non-operating expenses. What is the proportion of these items in relation to the total expenses and Net Profit after Tax?

Other non operating expenses for (2013-2014) are:

27. What was the total amount spent on employees? What is the percentage change in this amount as compared to the previous year?Total amount spent on employees as per employees benefit scheme in 2013-2014 period is Rs. 4713.92. It has a increase of 10.95%.

28. How much did the company spend on advertising, sales promotion and general marketing? What is the proportion of these items in relation to the total expenses, Net Profit after Tax and sales revenues?

Sr. No. Particulars Amount % of total expense

% net profit after tax

SR. No. Other expenses Amount % in total exp. % in net profit after tax

1 Manufacturing Rs. 7283.4 10.30 (1214)2 administrative Rs. 2219.92 3.14 (370.19)3 Selling Exp. Rs. 4538.71 6.42 (756088)

21

1 Advertising Rs. 130.69 0.18 21.792 Selling Rs. 343.95 0.48 57.35

29. What is the absolute amount and proportion of finance costs to the total revenues? What is the change in this absolute amount and proportion as compared to the previous year?

Particular amount Proportionate to total revenue

Change in amount

Change in proportionate

Finance cost Rs. 3365082 0.04 16.38% 0.00

30. Identify the top three weighing expense-heads in relation to the sales revenues. What are the accounting policies pertaining to these three heads of expenses?

Sr. No. Particular Amount (lakh) Relation to Sale Revenue

1 Cost of Production Rs. 41096.34 56.38%2 Employee Benefit

ExpenseRs. 4713.92 6.46%

3 Other Expense Rs. 14772.46 20.27%

31. What is the percentage of depreciation/amortization expense in relation to the gross

block value of the fixed assets and total expenses? What is the depreciation method and accounting estimates involved in charging depreciation in fixed assets?

Value of depreciation and amortization in respect to gross book value of fixed assets and total expense

Particulars AmountGross block value of fixed assets Rs. 37572.75Amount of depreciation/amortization Rs. 4324.95Depreciation/amortization in relation to fixed assets

11.51%

Total expenses Rs. 70682.79Depreciation/amortization in relation to total expense

6.11

21

Company take out depreciation by straight line method in plants at Arakkonam, karur, Maksi, corporate office and textile division units. Whereas in all other units they follow the process of written down value method for depreciation.

Balance Sheet

32. List three assets having highest proportion in the total assets of the company. Write their percentage weight in the total assets.

Three assets having highest proportion in the total assets are:

S. no.

ParticularsAmount (Crore)

% of Total Assets

1. Tangible fixed assets Rs. 36867.55 35.19%2. Inventories Rs. 22094.70 21.09%3. Non- current Investment Rs. 20319.16 19.39%Total Rs. 79281.41 75.69%

33. How does the company measure its fixed assets? What is the amount of fixed assets purchased during the year? What is its proportion in the total assets? Is this proportion significant? Why?

Policy of company regarding measuring of fixed assets is follow:

Tangible fixed assets are stated at cost of acquisition less accumulated depreciation/ amortization and impairment.

Land is stated at historical cost only. No depreciation is charged. The cost comprises purchase cost, and direct attributable cost that are incurred to

bring the assets to its working condition for the further use. Depreciation is charged on straight line method in some plants while by the

written down method in the remaining. Gain or losses arises after the sale of the assets measures as the difference

between the disposal value and carrying amount of such assets are recognized in profit and loss account.

Fixed assets purchased in year 2013-14Particulars Amount Proportion in total assets

Purchase of fixed assets during the year (2013-14)

Rs.16579.27 lakh

0.17

21

No proportion on purchase of fixed assets to total assets is not very significant as it is less than 1 also.

34. What is the amount of fixed assets sold/discarded during the year? What is its proportion in the total assets? Is this proportion significant? Why?

Sale of Fixed Assets in year 2013-14Particulars Amount Proportion in total fixed assets

Sale of fixed assets Rs. 18.54 Lakh 0.019

35. What is amount of capital work in progress finished and transferred to the fixed assets during the year?

Particular Amount Capital Work In Progress Rs. 147.96 LakhAdditional Capital Work In Progress Rs. 569.88 LakhCapital Work in Progress Transferred to fixed assets Rs. 368.32 Lakh Total (a+b-c) Rs. 349.32 Lakh

36. What is the proportion of Intangible assets in the total assets of the company? How does the company measure Intangible assets? Give two examples of the company’s intangible assets.

INTENGIBLE ASSETS

Particulars Amount (lakh)Proportion in total assets

Example of intangible assets

Intangible Assets

Rs. 130.07 0.1361. Computer Software

Intangible assets are recognized by the company when such condition prevail in which the future economic benefit that prevail to the company and the assets of the company are measure reliably. Amortization of intangible assets is done by Straight Line Method. Amortization is done in such a manner that the revised value is allocated over the remaining useful value of the asset.

37. What is the proportion of long term investments in the total assets? What is the change in this proportion as compared to the previous year?

Long term Investments for (2013-2014) - there are no long term investments, company usually due investment for the current financial year only.

21

38. List three most significant investment venues. What is the book value and market value of these investments?

Sr. No. Particular Book Value

1 The Ramco Cements Ltd Rs. 18443.132 Sudharsanam Investment Ltd Rs. 1844.593 Ramco Ind, Employees Co- operative Rs. 20319.16

Total Book Value of these three investment venues is Rs. 40606.88

39. What is the proportion of Investments in Subsidiary Companies in the total investments? Is there any change in the amount of Investments in Subsidiary Companies in the current year as compared to the previous year?

Particular Amount Proportion in total investment

Change in the proportion

Investment in Subsidiaries

Rs.1844.59 0.090 No Change

40. What is the proportion of current assets in the total assets? What is the change in this proportion as compared to the previous year?

Particular Amount ( in lakh) Proportionate to total assets

Change in Proportion

Current Assets Rs. 35050.70 0.367 (13.43)%

41. What is the proportion of cash in the total assets? What is the change in this proportion as compared to the previous year? Is there any cash in transit? How much?

Particular Amount ( in Lakh) Proportionate to total assets

Change in Proportion

Cash and Bank Balance

Rs. 1272.53 0.013 18.11%

No information is given regarding the cash in transit in the annual report.

21

42. What is the proportion of the accounts receivables in relation to the credit sales of the company? What percentage of the company’s receivables is classified as doubtful? What is the change in this proportion as compared to the previous year?

Particular Amount Doubtful Trade Receivable

Trade Receivable Rs. 6523.81 Lakh 2.53%

43. What percentage of the company’s receivables is due for more than six months? What is the change in this proportion as compared to the previous year?

Particular

Amount (Lakh) Change in proportion

Trade receivable doubt for more than 6 months

Rs. 164.93 39%

44. What is the proportion of Inventories in the total assets? What is the change in this proportion as compared to the previous year?

Particular Amount (Lakh) Proportion to total assets

Change in proportion

Inventories Rs. 22094.70 0.23 (1.71%)

45. How does company measure its Inventories? Is there any change in the inventory measurement as compared to the previous year? If yes, give details.

Measurement of Inventories:

Raw Material, spares, stores and packing material are being measured at the cost. It includes the cost or price of bringing the goods to the centre also, or they measure at the net realizable value, whichever is less.

Work in Progress is valued at Weighted Average Cost. Finished Goods are valued at the cost or at the releasable value whichever is less

among them. Cost include everything from conversion of raw material into a finished good and then bring it to the store plus it also consists of all the Taxes.

21

There is no information given in the annual report regarding the change of measurement method, so we assume that they are following same formula from many years.

46. What is the absolute amount and proportion in relation to sales revenues of raw materials consumed during the year? What is the change in such amount and proportion as compared to the previous year?

Particular Amount (lakh) Proportion to the sales revenue

Change in the proportion

Change in the amount

Raw material consumed

Rs. 41096.34 0.61 No change Decrease by Rs.9670.94

47. What is the amount of short term investments? What is the percentage change in short term investments as compared to the previous year? How does the company measure short term investment? List three venues of short term investments for the company?

Particular Amount (lakh) Percentage change in respect to last year

Short term Investments Rs. 20319.16 Increase by 0.015

Company measure its short term investment basically at the cost. Provision of diminution is made to recognize other than decline. All the investment of the company are on short term basis they don’t invest for long term.

48. What is the proportion of current liabilities in the total liabilities? What is the change in this proportion as compared to the previous year?

Current Liability for 2013-2014 periods

Particulars Amount (lakh) Proportionate to total liabilities

Change in respect to last year.

Current Liabilities Rs.28631.61 0.3 0.045

49. List three most significant current liabilities? What is the percentage change in these three current liabilities as compared to the previous year?

Particular Amount (lakh) Change in respect to previous year

Short term Borrowing Rs. 17361.31 Increase by 3.74%

21

Current maturities for long term debt

Rs. 4639.32 Decrease by 36.66%

Other Liability Rs. 4639.32 Increase by 71.66%

50. What is the proportion of trade (accounts) payables in the total liabilities? What is the change in this proportion as compared to the previous year?

Particular Amount (lakh) Proportionate to Total Liabilities

Change in proportionate

Accounts Payable Rs. 1966.58 0.02 No change51. What are the company’s contingent liabilities?

Contingent Liability of a company:

Claims against the company of Rs. 2000.44 Lakh Claim against the guarantee to bankers of Rs. 10179.22 Claims towards Tamil Nadu General & distribution, corporation Limited for the

violation of terms and condition in supply of electricity of Rs. 27.41 lakh

52. What is the proportion of long term liabilities in the total liabilities? What is the change in this proportion as compared to the previous year? List the three most significant source of long term liability?

Particular Amount (Lakh) Proportionate to total liability

Change in the proportionate

Long term Liabilities

Rs. 19821.04 0.207 No change

Three significant Long term Liabilities for the year (2013-2014) are:

a. Long Term Borrowing – Rs. 17420.31b. Security deposit from Customer – Rs. 2105.31c. Long Term Provisions – Rs. 295.42

53. What is the proportion of share capital in the total liability? Is there any change in the amount of share capital as compared to the previous year? What is the source of this change?

Share Capital for the year 2013-2014

21

Particular Amount Proportionate of share capital towards total liability

Share Capital Rs. 866.63 Lakh 0.009

There is no change in the share capital from last year.

54. What is the face value of the equity share? Has the company issued any shares for services or non-cash assets? If yes, give details

Face Value of the equity share of a company is Rs. 1, Company hasn’t issued any shares for services or non-cash assets.

55. What is the proportion of Reserves in the total liabilities? What is the change in this proportion as compared to the previous year?

Particulars Amount (lakh) Proportion to total liability

Change in proportion

Reserves Rs.45138.96 0.47 0.002

56. How much is the basic and Diluted EPS and dividend per share?

Diluted Earnings per share is 0.69

Dividend per share is Rs. 1

57. Read the Corporate Grievance Report theorially and give details about three significant items mentioned therein.

Corporate Grievance Report

Three significant items mentioned in the corporate grievance report are as follows:

Company Philosophy on corporate governance - Corporate governance in the integral part of any organization. It helps in inspiring the shareholder’s , creditors, members of the company and all those people who are linked to the company in any way . It give them believe that they are working in good environment and they will not go for loss. Management set new goals for them and tries to achieve with similar set of politics but along with it they maintain the business ethics. Company is always looking for the up gradation of technology so to improve its

21

productivity. Company put much emphasis on human resources for this they always tries to motivate the members of the company.

Board of Directors – Board of directors are the most important person in an organization. As they are the representative of the shareholder in the company. Their duty is to look that company is going in the right direction. For all this duties it is required that directors should be well qualified otherwise they can take towards wrong end.

Shareholders- For the appointment or reappointment of the directors, shareholders were being provided with the information at the annual general meeting, about their expertice. The information is also given with a notice at the time of calling for the annual general meeting.

58. Read carefully the business responsively Report and therein mention any three significant factors mentioned

Business Responsively Report

Couldn’t find the brand responsively report in the Annual Report.

59. Read carefully the corporate social responsibility report and give detail of the three significant items mentioned in it.

Corporate Social Responsibility

At present, when corporate world is rising at a great speed. They are utilizing the resources with full force , so it become their responsibility also either one say forcefully or ethically company should give something back to the society, environment. AS per the guidelines of the corporate affairs ministry guidelines it has become compulsory for every business to do something for their society, which is known as Corporate Social Responsibility. Ramco Industries also knows their duties toward the society and environment. The result of this is that every year they give donation to charitable trust. In the current financial year of 2013-2014 they have spent Rs. 134.91 Lakh.

60. Read carefully the Management Discussion Analysis and give report of three most significant items mentioned in it.

Management Discussion Analysis Report 2013-2014

Building Product Division (in tones)

21

Particulars2013-14

2012-13

Change over previous year (2012-13)

Fibre Cement Sheet

397064 565189 (168125)

Calcium Silicate Board

14451 13297 1154

Cotton Yarn Division

Production of the yarn was less during the period in compare to last year but the sales are increased in the current financial year. The rate of cotton was continually fluctuating but due to the constant production our demand has increased both in country as well as outside the country also. The power cut is continue in the state but thank to the decision of management of installing wind mills, industry got the electricity. The cotton prices are at high. The cost of major inputs is also increasing but the price of yarn is low and sluggish. There is no parity between the price of cotton and yarn the company is trying its best in this tough situation of price high with the measure like cost cutting, giving trainees to the employees at all the levels. The directors of the company are hopeful that their hard work will give good fruits after sometime.

Overseas operation of the Subsidiaries

The production of the product and sales are increased by 14% and 265 respectively in comparison to last year . Due to the sluggish market condition net sales value of the Ramco Industries dropped but due to the growth in its subsidiaries the consolidated balance sheet of the company has shown some rise in the volume of the sales compared to the last year.

21