12 Chapter 6
12 Chapter 6
12 Chapter 6
In the other words, the profit and loss account and balance sheet statements are
the common important accounting statements of a business organization. The
profit and loss account provides the financial information relating to only a
limited range of financial transactions entered into during an accounting period
and which have impact on the profits to be reported. The balance sheet contains
information relating to capital debt raised or assets purchased. Along with the
information about the assets and liabilities as well as the profit and loss, it is
equally important to know what funds became available during the accounting
year and how such funds were applied. This information may be obtained by
preparing a statement of source and application of funds. This statement
demonstrates the movement of funds into and out of the business during the
course during the accounting period.
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6.2 CONCEPT OF “FUND’’:
The term ‘fund’ has been defined and interpreted differently by different experts.
Broadly the term ‘fund’ refers to all the financial resources of the company. On
the other extreme, fund has been understood as ‘cash’ only. According to the
International Accounting Standard No. 7, the term generally refers to cash, to
working capital and to cash and cash equivalents (long term financial sources).
A) Fund means cash: Under this concept, the term “funds” is used only in
the sense of cash and bank balance. Here, only the changes in cash and
bank are considered. Hence, the statement is called “Cash Flow statement.
This statement aims at listing the various items which bring about
changes in the cash balance between two balance sheet dates. Cash
planning becomes useful for control purposes. Since cash is considered as
short term assets, they are subjected to short term fluctuations. A delay in
making payment to suppliers and a provision of one month’s credit for
making a payment of land purchases may show sufficient cash flow. They
may reflect a satisfactory position, but it is not a reality. Therefore, cash
equivalent concept of fund is useful only for short term financial planning
and not for long term. Thus cash and bank is one part of fund.
194
The operating cycle of working capital (working capital flow) is as follow:
Receivables
Working
Finished goods Capital Cash Balance
Flow
Raw Materials,
Labour Expense
C) Fund means total financial resources: The term “funds” is very often
used in the sense of useful financial resources also. Cash approach and
working capital approach both are incomplete and inadequate to the
extent that they omit a few major financial and investment transactions.
Such items do not affect net working capital. But, if they are included, they
would certainly provide qualitative information for the decision making,
For example issuing equity shares and debentures for purchase of
buildings or assets shall not have any effect on the working capital. But it
is a significant financial transaction that should be disclosed. Therefore,
this concept seems to be the best approach to disclose the changes in the
financial position as compared to other concepts. It is in conformity with
the statutory regulations and legal requirements.
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working capital may be in the form of inflow of working capital or outflow of
working capital. In other words, any increase or decrease in working capital
when the transactions take place is called as "Flow of Funds." If the components
of working capital results in increase of the fund, it is known as Inflow of Fund or
Sources of Fund. Similarly, if the components of working capital effects in
decreasing the financial position it is treated as Outflow of Fund. For example, if
the fund raised by way of issue of shares will be taken as a source of fund or
inflow of fund. This transaction results in increase of the financial position. Like
this, the fund used for the purchase of machinery will be taken as application or
use of fund or outflow of fund, because it stands to reduce the fund position.
Increase the funds while others decrease the funds. Some may not make any
change in the funds position. In case a transaction results in increase of funds, it
will be termed as a “sources of funds”. In case a transaction results in decrease of
funds it will be taken as an application or use of funds. In case a transaction does
not make any change in the funds position, it is said that it is a non-fund
transaction.
No Flow of Funds:
Some transactions may not make any movement or changes in the fund position.
Such transactions are involved within the business concern. Like the transaction
which involves both between current assets and current liabilities and between
non-current assets and non-current liabilities and hence do not result in the flow
of funds. For example, conversion of shares in to debenture. Such transaction
196
involves between non-current accounts only and this activity does not effect in
increase or decrease of the working capital position.
A fund flow statement matches the funds raised and funds applied during a
particular period. The sources and applications of fund may be of capital as well
as of revenue nature. A fund flow statements provide a meaningful link between
the balance sheets at the beginning and at the end of the period and profit and
loss account of the period. In view of recognized importance of capital inflows
and outflows which often involve large amount of money should be reported to
stake holders, the fund flow statement is devised.
In the words of Anthony, “The fund flow statement describes the sources from
which additional funds were derived and the uses to which these sources were
put.”
197
The I.C.W.A. in glossary of management accounting terms defines fund flow
statement as “a statement prospective or retrospective, setting out the sources
and applications of the funds of an enterprise. The purpose of this statement is to
indicate clearly the requirement of funds and how they are proposed to be raised
and the efficient utilization and application of the same.”
198
(4) It enables to know whether the funds have been properly used:- The
funds flow statement enables the management to know whether the funds
have been properly used in purchasing various assets or repaying loans etc.
(5) Helpful in proper management of working capital:- While managing
working capital in a business, it becomes essential to ensure that it should
neither be excessive nor inadequate. A fund flow statement indicates the
excessiveness or inadequacy in working capital.
(6) Helps in preparation of budget for the next period:- A fund flow
statement is prepared for next year, it will enable the management to plan
its financial resources properly. The firm will know how much funds it
requires, how much the firm can manage internally and how much it should
arrange from outside source. This is helpful in preparing the budgets for the
future period.
(7) It helps a firm in borrowing operations:- A fund flow statement prepared
for the future period indicates whether the company will have sufficient
funds to repay the interest & loans in time.
(8) Helpful in determining dividend policy: - Sometimes, there may be
sufficient profit but the distribution of dividend may not be possible due to
its adverse effect on the liquidity and working capital of the business. in such
cases a funds flow statement help in leading whether to distribute the
dividend or not because a funds flow statement will reveal from where and
how much funds can be managed for distributing the dividends.
(9) Useful to shareholders:- Shareholders also get information about the
financial policies of the enterprise with the help of fund flow statement.
Sources of funds:
Generally funds are derived from:
1. Operating of business i.e. operating income
2. Income from investment
199
3. Sale of assets
4. Sale of long term investments
5. Contribution of share holders
6. Increase in long term liabilities, e.g., issue of debentures
7. Gifts, damages awarded in legal action etc.
200
3. It enables the Bankers, creditors or financial institutions in
assessing the degree of risk involved in granting credit to the
business.
4. The management can rearrange the firm’s financing more
effectively on the basis of the statement.
5. Various uses of funds can be known and after comparing them
with the uses of previous years, improvement or downfall in
the firm can be assessed.
6. It provides a basis for preparation budgets for the future.
7. The statement compared with the budget concerned will show
to what extent the resources of the firm were used according
to plan and what extent the utilization was unplanned.
8. It tells whether sources of funds are increasing or decreasing
or constant.
9. It points out the financial strengths and weaknesses of the
business.
10. It helps in working capital management of the company.
11. It appraises the shareholders regarding the uses of funds in
the business.
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(7) It is not an original statement but simply a rearrangement of two
statements or financial data.
(8) It is not a substitute of income statement or a balance sheet. It is
only a supplement to them.
202
amount owing to creditors, bank loans due for repayment, proposed
dividend and proposed tax for payment and expenses accrued due.
203
Table No.6.1
FUND FLOW STATEMENTS OF DGVCL
DESCRIPTION 2013-14 2012-13 2011-12 2010-11
Sources of Funds:
Cash Profit from operations 195.87 146.05 179.10 154.72
Decrease in Investments 1.89 61.11 0.00 0.00
Increase in Share Capital 1.66 0.00 0.00 0.00
Increase in Share
0.00 10.94 0.00 0.00
warrants/outstanding
Increase in Sec. Loans 0.00 52.86 0.00 0.00
Increase In Unsecured Loans 165.13 51.15 824.97 0.00
Decrease in Working Capital 186.50 45.68 0.00 115.56
Others 211.92 164.75 233.11 149.80
Total 762.97 532.55 1237.17 420.08
Application of Funds:
Increase in Gross Block 625.42 532.55 285.61 204.48
Decrease in Share Capital 0.00 0.00 0.00 0.00
Decrease in Sec. Loans 126.61 0.00 97.76 124.41
Decrease in Un. Sec Loans 0.00 0.00 0.00 91.19
Decrease in Share
10.94 0.00 0.00 0.00
warrants/outstanding
Increase in Investments 0.00 0.00 85.78 0.00
Interim Dividend Paid 0.00 0.00 0.00 0.00
Equity Dividend Paid 0.00 0.00 0.00 0.00
Corporate dividend tax paid 0.00 0.00 0.00 0.00
Increase in Working Capital 0.00 0.00 768.02 0.00
Others 0.00 0.00 0.00 0.00
Total 762.97 532.55 1237.17 420.08
Analysis:
The above table no.6.1 presents the fund flow statement of DGVCL during the
study period of 2010-11 to 2013-14. It would provide the valuable information
about the changes in the long-term sources of funds and in the quantum of
working capital. First part of the statement shows the sources of funds. Profit
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from operations shows the mixed trend during the study period. It is ranged
between 146.05 in 2012-13 and 195.87 in 2013-14. The company has sold the
investments during last two years of the study period. Company has issued
additional share capital 1.66 crore in 2013-14. Again it shows that company has
taken a secured loan of 52.86 in the year 2012-13. Company has borrowed huge
amount in form unsecured loan in the year 2011-12, 2012-13 and 2013-14.
824.97% increase in unsecured loan in 2011-12 as compare to 2010-11. Amount
in working capital was also decreased in the year 2010-11, 2012-13 and 2013-
14.
Second part of the statement shows the application of funds. Company has
purchased the fixed assets of Rs.204.48 crore, Rs.285.61 crore, Rs.532.55 crore
and Rs.625.42 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows the progressive trends during the study period. 86.46%
increase in fixed assets in 2012-13 as compare to the year 2011-12. Company
has repaid the secured loans in the year 2010-11, 2011-12 and 2013-14.
Company’s working capital was increased of Rs.768.02 crore in the year 2011-
12. Company has invested Rs.85.78 crore in investments in the year 2011-12.
Table No.6.2
FUND FLOW STATEMENTS OF MGVCL
DESCRIPTION 2013-14 2012-13 2011-12 2010-11
Sources of Funds:
Cash Profit from operations 151.46 135.27 142.92 125.92
Decrease in Investments 0.00 0.00 0.00 0.00
Increase in Share Capital 7.07 0.00 0.00 0.00
Increase in Share 0.00 42.42 0.00 0.00
warrants/outstanding
Increase in Sec. Loans 0.00 1.61 0.00 0.00
Increase In Unsecured Loans 30.47 58.33 36.42 467.88
Decrease in Working Capital 199.54 19.51 0.00 0.00
Others 138.66 86.03 200.16 57.82
Total 527.20 343.17 379.50 651.62
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Application of Funds:
Increase in Gross Block 426.30 327.12 287.69 205.48
Decrease in Share Capital 0.00 0.00 0.00 0.00
Decrease in Sec. Loans 40.37 0.00 57.02 39.45
Decrease in Un. Sec Loans 0.00 0.00 0.00 0.00
Decrease in Share 42.42 0.00 0.00 0.00
warrants/outstanding
Increase in Investments 18.11 16.05 4.13 43.30
Interim Dividend Paid 0.00 0.00 0.00 0.00
Equity Dividend Paid 0.00 0.00 0.00 0.00
Corporate dividend tax paid 0.00 0.00 0.00 0.00
Increase in Working Capital 0.00 0.00 30.66 363.39
Others 0.00 0.00 0.00 0.00
Total 527.20 343.17 379.50 651.62
Analysis:
The above table no.6.2 shows the fund flow statement of MGVCL during the study
period of 2010-11 to 2013-14. It would provide the valuable information about
the changes in the long-term sources of funds and in the quantum of working
capital of the MGVCL. First part of the statement shows the sources of funds.
Profit from operations shows the mixed trend during the study period. It is
ranged between 125.92 in 2010-11 and 151.46 in 2013-14. The Company has
issued additional share capital 7.07 crore in 2013-14 and increased in Share
warrants/outstanding of 42.42 crore in the year 2012-13. Again it shows that
company has taken a secured loan of 1.61 crore in the year 2012-13. Company
has borrowed huge amount in form unsecured loan of Rs. 467.88 crore, Rs. 36.42
crore, Rs. 58.33 crore and Rs. 30.47 crore in the year 2010-11, 2011-12, 2012-13
and 2013-14 respectively. Amount in working capital was also decreased in the
last two years of study period by Rs. 19.51 crore and Rs. 199.54 respectively.
Moreover company has received funds in form of other sources by Rs. 57.82
crore, Rs. 200.16 crore, Rs. 86.03 crore and Rs. 138.66 crore in the year 2010-11,
2011-12, 2012-13 and 2013-14 respectively. It is increased by 246.18 % in the
year 2011-12 as compared to year 2010-11.
206
Second part of the statement shows the application of funds. Company has
purchased the fixed assets of Rs.20548 crore, Rs.287.69 crore, Rs. 327.12 crore
and Rs. 426.30 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows the continuously progressive trends during the study
period of 2010-11 to 2013-14. 30.32% increase in fixed assets in 2013-14 as
compare to the year 2012-13. Company has repaid the secured loans in the year
2010-11, 2011-12 and 2013-14. Company’s working capital was increased of Rs.
363.39 crore and Rs. 30.66 in the year 2010-11 and 2011-12 respectively.
Company has purchased investment of Rs. 43.30, Rs.4.13, Rs.16.05 and Rs.18.11
crore in the year 2010-11, 2011-12, 2012-13 and 2013-14 respectively.
Table No.6.3
FUND FLOW STATEMENTS OF PGVCL
DESCRIPTION 2013-14 2012-13 2011-12 2010-11
Sources of Funds:
Cash Profit from operations 385.40 321.22 259.17 216.84
Decrease in Investments 0.00 26.31 0.00 0.00
Increase in Share Capital 440.12 324.00 0.00 0.00
Increase in Share 0.00 0.00 2.38
0.00
warrants/outstanding
Increase in Sec. Loans 20.09 164.32 0.00 36.61
Increase In Unsecured Loans 0.00 319.52 10.78 41.75
Decrease in Working Capital 352.80 93.74 495.72 265.43
Others 169.65 231.64 372.52 394.25
Total 1368.06 1480.74 1140.57 954.88
Application of Funds:
Increase in Gross Block 1196.22 1381.90 1115.67 911.25
Decrease in Share Capital 0.00 0.00 0.00 0.00
Decrease in Sec. Loans 0.00 0.00 18.68 0.00
Decrease in Un. Sec Loans 164.88 0.00 0.00 0.00
Decrease in Share 3.54 98.84 0.00 6.84
warrants/outstanding
Increase in Investments 3.42 0.00 6.21 36.84
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Interim Dividend Paid 0.00 0.00 0.00 0.00
Equity Dividend Paid 0.00 0.00 0.00 0.00
Corporate dividend tax paid 0.00 0.00 0.00 0.00
Increase in Working Capital 0.00 0.00 0.00 0.00
Others 0.00 0.00 0.00 0.00
Total 1368.06 1480.74 1140.57 954.88
Analysis:
The above table no.6.3 indicates the fund flow statement of PGVCL during the
study period of 2010-11 to 2013-14. It would provide the valuable information
about the changes in the long-term sources of funds and in the quantum of
working capital of the PGVCL. First part of the statement shows the sources of
funds. Profit from operations shows the mixed trend during the study period. It
is ranged between 216.84 in 2010-11 and 385.40 in 2013-14. The Company has
issued additional share capital of Rs. 324.00 crore and Rs.440.12 crore in 2012-
13 and 2013-14 respectively and increased in Share warrants/outstanding of
Rs.2.38 crore in the year 2011-12. Again it shows that company has taken a
secured loan of Rs. 36.61 crore, Rs. 164.32 crore and Rs. 20.09 crore in the year
2010-11, 2011-12 and 2013-14 respectively. Company has borrowed huge
amount in form unsecured loan of Rs. 41.75 crore, Rs. 10.78 crore and Rs. 319.52
crore in the year 2010-11, 2011-12 and 2012-13 respectively. It is increased by
2864% in the year 2012-13 as compared to 2011-12. Amount in working capital
was also decreased by Rs. 265.43 crore, Rs. 495.72 crore, Rs. 93.74 crore and Rs.
352.80 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14 respectively.
Moreover company has received funds in form of other sources by Rs. 394.25
crore, Rs. 372.52 crore, Rs. 231.64 crore and Rs. 169.65 crore in the year 2010-
11, 2011-12, 2012-13 and 2013-14 respectively.
Second part of the statement shows the application of funds. Company has
purchased the fixed assets of Rs. 911.25 crore, Rs. 1115.67 crore, Rs. 1381.90
crore and Rs. 1196.22 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows the mixed trends during the study period of 2010-11 to
2013-14. Company has repaid the secured loans in the year 2011-12 by Rs. 18.68
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crore. Company has purchased investment of Rs. 36.84, Rs. 6.21 and Rs. 3.42
crore in the year 2010-11, 2011-12 and 2013-14 respectively.
Table No.6.4
FUND FLOW STATEMENTS OF UGVCL
DESCRIPTION 2013-14 2012-13 2011-12 2010-11
Sources of Funds:
Cash Profit from operations 187.39 155.91 144.43 132.16
Decrease in Investments 3.44 0.00 74.41 68.32
Increase in Share Capital 29.56 0.00 0.00 0.00
Increase in Share 0.00 168.50 0.00
0.00
warrants/outstanding
Increase in Sec. Loans 29.38 0.00 0.00 0.00
Increase In Unsecured Loans 0.00 282.21 0.00 0.00
Decrease in Working Capital 296.08 0.00 113.52 126.37
Others 261.12 120.27 59.43 43.62
Total 806.98 726.89 391.80 370.47
Application of Funds:
Increase in Gross Block 541.55 544.95 293.70 272.31
Decrease in Share Capital 0.00 0.00 0.00 0.00
Decrease in Sec. Loans 0.00 8.28 29.04 34.98
Decrease in Un. Sec Loans 96.93 0.00 69.05 63.18
Decrease in Share 168.50 0.00 0.00
0.00
warrants/outstanding
Increase in Investments 0.00 0.99 0.00 0.00
Interim Dividend Paid 0.00 0.00 0.00 0.00
Equity Dividend Paid 0.00 0.00 0.00 0.00
Corporate dividend tax paid 0.00 0.00 0.00 0.00
Increase in Working Capital 0.00 172.68 0.00 0.00
Others 0.00 0.00 0.00 0.00
Total 806.98 726.89 391.80 370.47
Analysis:
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The above table no.6.4 indicates the fund flow statement of UGVCL during the
study period of 2010-11 to 2013-14. It would provide the valuable information
about the changes in the long-term sources of funds and in the quantum of
working capital of the UGVCL. First part of the statement shows the sources of
funds. Profit from operations shows the progressive trend during the study
period. It is ranged between 132.16 crore in 2010-11 and 187.39 crore in 2013-
14. The Company has issued additional share capital of Rs. 29.56 crore in the
year 2013-14. It shows that the amount increased in Share
warrants/outstanding of Rs. 168.50 crore in the year 2012-13. Again it shows
that company has taken a secured loan of Rs. 29.38 crore in the year 2013-14.
Company has borrowed huge amount in form unsecured loan of Rs. 282.21 crore
in the year 2012-13. Amount in working capital was also decreased by Rs. 126.37
crore, Rs. 113.52 crore and Rs. 296.08 crore in the year 2010-11, 2011-12 and
2013-14 respectively. Moreover company has received funds in form of other
sources by Rs. 43.62 crore, Rs. 59.43 crore, Rs. 120.27 crore and Rs. 261.12 crore
in the year 2010-11, 2011-12, 2012-13 and 2013-14 respectively.
Second part of the statement shows the application of funds. Company has
purchased the fixed assets of Rs. 272.31 crore, Rs. 293.70 crore, Rs. 544.95 crore
and Rs. 541.55 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows the fluctuated progressive trends during the study period
of 2010-11 to 2013-14. Company has repaid the secured loans of Rs. 34.98 crore,
29.04 crore and Rs. 8.28 in the year 2010-11, 2011-12 and 2012-13. Company
has purchased investment of Rs. 0.99 crore in the year 2012-13.
6.11 INTRODUCTION:
The separation of management from ownership in modern business calls for the
use of some form of connection between the managers and the owners and other
interested parties. Financial reporting is the most efficient and extensively used
medium of communicating the operating results as well as latest financial
position of a concern for the management. Constancy and achievement of any
210
business largely depend on its capacity to generate enough cash. As part of
conveying an end result of companies operation managements use financial
statement as an important vehicles through which financial information is
furnished to the stakeholders. But the three basic financial statements present
only fragmentary information about a company’s cash flows (cash receipt and
cash payments).
211
The Cash Flow Statement (CFS) provides relevant financial information about the
cash receipts and cash disbursements of a firm during a fiscal year. This
information is especially important to shareholders and creditors. As part of
their investment return, shareholders often expect to receive dividends, and the
ability to pay cash dividends depends on the availability of cash flows. Creditors
are concerned about a firm’s ability to make interest and principal payments on
loans they have made to the firm. Other stakeholders such as employees and
suppliers are also concerned about a firm’s ability to meet its financial
obligations.
Unlike the many ways in which reported earnings can be presented, there is little
a company can do to manipulate its cash situation. Barring any outright fraud,
the cash flow statement tells the whole story. The company either has cash or it
does not. Analysts will look closely at the cash flow statement of any company in
order to understand its overall health. Statement of cash flows provides the
answer to the following simple but important question about an enterprise.
(Keiso and Weygand, 1998: 1275-76)
The use of cash flow information is gaining value in the analysis of financial
statements. Cash flow information is measured less open to manipulation than
information on earnings, because it is based on the actual receipt and payment of
212
cash only and not on the accrual and other accounting principles. However, the
literature on the cash flow statement indicates that there are grey areas in cash
flow reporting that are open to various interpretations. The perceived simplicity
of the cash flow statement may therefore create synthetic confidence in the
reliability of companies‟ cash flow reporting and the comparability of various
companies’ cash flow information. The acceptance of AS-3: The Cash Flow
Statement has added a new dimension to the preparation and presentation of
financial statements in Bangladesh. This paper is an effort to investigate into the
state of cash flow reporting by the listed Bangladeshi non-banking financial
companies in general. The focal point is not on the quality of the reporting of the
companies but rather on what the reporting levels are in general.
213
How was it possible to pay dividends when the business reported a net
loss on its income statement?
Does the firm have the ability to pay off the mortgage on its office
building?
214
services than they spend in doing so. As you know, revenues are recorded
when they are earned and expenses are recorded when incurred.
Revenues and expenses therefore seldom match perfectly with their
corresponding cash flows. For example, of $20,000 sales during the
current fiscal period, perhaps only $10,000 are collected in the same
period as the sales. The income statement also includes noncash expenses
such as amortization. Amortization expense reduces income without a
corresponding reduction in cash. You should think of operating cash flow
activities as those that affect net income as well as current assets and
current liabilities (the working capital accounts or operating accounts).
Changes in working capital accounts are very much affected by a
company’s rate of growth. Expanding businesses will usually report
significant increases in accounts receivable and inventories. If a business
uses suppliers to finance these increases, you will see an upward change
in accounts payable. Some changes in current liabilities, however, are not
usually classified as operating activities. For instance, changes in
dividends payable and interest charged to retained earnings are classified
as financing activities. In the previous example, a business may finance
increases in accounts receivable and inventory with borrowing or equity
financing. However, borrowing and equity financing are not considered to
be operating activities.
215
3. Financing activities: Financing activities affect a business’ capital
structure, its debt and equity. This includes a company’s transactions with
its owners and creditors but does not include cash payments to settle
credit purchases of merchandise, which are operating activities. Financing
activities include the use of cash to pay dividends to shareholders, the
borrowing or payment of debt, and the issue or repurchase of shares. Do
not confuse dividends declared and paid with dividends received from
investments. Dividends paid are a cash outflow that is a financing activity,
but dividends received are a cash inflow reported on the income
statement. Dividends received are therefore classified as an operating
activity.
216
6. This analysis includes cash 6. This analysis does not include
flow analysis because cash is a fund flow analysis because this
part of working capital. covers only cash transactions.
7. While preparing statement of
7. In cash flow analysis increase
changes in working capital if
in current assets or decrease
current assets increase or
In current debts means
current debts decrease,
reduction in cash.
working capital increases.
217
4. Indicate the amount, timing and probability of future cash flows.
The cash flow statement has been adopted as a standard financial statement
because it eliminates allocations, which might be derived from different
accounting methods, such as various timeframes for depreciating fixed assets.
TABLE NO.6.5
CASH FLOW STATEMENTS OF DGVCL
Analysis:
218
The above table no.6.5 shows the cash flow statement of DGVCL during the study
period 2010-11 to 2013-14. Cash flow after changes in working capital was Rs.
433.16 crore, Rs.253.10 crore, Rs.383.63 crore and Rs.611.91 crore in the year
2010-11, 2011-12, 2012-13 and 2013-14 respectively. It shows progressive
trend during the year 2011-12 to 2013-14. It was increased by 85.57 % in 2013-
14 as compare to 2012-13. Cash flow from operating activities was Rs. 376.24
crore, Rs.221.54 crore, Rs.380.59 crore and Rs.619.44 crore in the year 2010-11,
2011-12, 2012-13 and 2013-14 respectively. It shows fluctuated and progressive
trend during the study period. It was increased by 62.76 % in 2013-14 as
compare to 2012-13. Cash flow from investing activities was Rs. -205.52 crore,
Rs.-286.11 crore, Rs.-532.61 crore and Rs.-628.54 crore in the year 2010-11,
2011-12, 2012-13 and 2013-14 respectively. It shows progressive trend during
the study period. It was increased by 86.16 % in 2012-13 as compare to 2011-12.
Cash flow from financing activities was Rs. -146.40 crore, Rs.115.56 crore,
Rs.169.56 crore and Rs.47.95 crore in the year 2010-11, 2011-12, 2012-13 and
2013-14 respectively. It shows fluctuated trend during the study period. Closing
balance of cash and equivalent was Rs.83.50 crore, Rs.134.59 crore, Rs.152.03
crore and Rs.190.88 crore during the year 2010-11, 2011-12, 2012-13 and 2013-
14 respectively. It shows the progressive trend during the study period.
TABLE NO.6.6
CASH FLOW STATEMENTS OF MGVCL
219
Cash Flow from Investing Activities -433.43 -345.57 -289.35 -227.36
Cash from Financing Activities 55.14 117.63 84.41 4.43
Net Cash Inflow / Outflow -2.00 10.96 13.78 7.08
Opening Cash & Cash Equivalents 60.61 49.65 35.87 28.79
Cash & Cash Equivalent on
- - - -
Amalgamation / Take over / Merger
Cash & Cash Equivalent of
- - - -
Subsidiaries under liquidations
Translation adj. on reserves / op cash
- - - -
balances frgn subsidiaries
Effect of Foreign Exchange
- - - -
Fluctuations
Closing Cash & Cash Equivalent 58.62 60.61 49.65 35.87
Analysis:
The above table no.6.6 shows the cash flow statement of MGVCL during the study
period 2010-11 to 2013-14. Cash flow after changes in working capital was Rs.
229.98 crore, Rs.225.75 crore, Rs.238.99 crore and Rs.379.16 crore in the year
2010-11, 2011-12, 2012-13 and 2013-14 respectively. It shows fluctuated and
progressive trend during the study period. It was increased by 58.65 % in 2013-
14 as compare to 2012-13. Cash flow from operating activities was Rs. 230.01
crore, Rs.218.73 crore, Rs.238.91 crore and Rs.376.29 crore in the year 2010-11,
2011-12, 2012-13 and 2013-14 respectively. It shows fluctuated and progressive
trend during the study period. It was increased by 57.50 % in 2013-14 as
compare to 2012-13. Cash flow from investing activities was Rs. -227.36 crore,
Rs.-289.35 crore, Rs.-345.57 crore and Rs.-433.43 crore in the year 2010-11,
2011-12, 2012-13 and 2013-14 respectively. It shows progressive trend during
the study period. It was increased by 25.43 % in 2013-14 as compare to 2012-13.
Cash flow from financing activities was Rs. 4.43 crore, Rs.84.41 crore, Rs.117.63
crore and Rs.55.14 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows fluctuated trend during the study period. Closing balance
of cash and equivalent was Rs.35.87 crore, Rs.49.65 crore, Rs.60.61 crore and
Rs.58.62 crore during the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows the mixed trend during the study period.
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TABLE NO.6.7
CASH FLOW STATEMENTS OF PGVCL
Analysis:
The above table no.6.7 presents the cash flow statement of PGVCL during the
study period 2010-11 to 2013-14. Cash flow after changes in working capital was
Rs. 716.32 crore, Rs.723.04 crore, Rs.41.42 crore and Rs.1494.44 crore in the
year 2010-11, 2011-12, 2012-13 and 2013-14 respectively. It shows fluctuated
and progressive trend during the study period. There was sharp decline in the
year 2012-13 in cash flow after changes in working capital by 681.62 crore. It
221
was increased by 3508 % in 2013-14 as compare to 2012-13. Cash flow from
operating activities was Rs. 701.20 crore, Rs.699.02 crore, Rs.38.32 crore and
Rs.1419.42 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows fluctuated trend during the study period. It was increased
by 3604 % in 2013-14 as compare to 2012-13. Cash flow from investing
activities was Rs. -666.48 crore, Rs.-1127.65 crore, Rs.-1384.24 crore and Rs.-
1194.15 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14 respectively.
It shows progressive trend during the year 2010-11 to 2012-13. Cash flow from
financing activities was Rs. -25.53 crore, Rs.415.14 crore, Rs.1403.89 crore and
Rs.-265.70 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows fluctuated trend during the study period. Closing balance
of cash and equivalent was Rs.79.27 crore, Rs.66.37 crore, Rs.124.34 crore and
Rs.83.91 crore during the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows the fluctuated trend during the study period.
TABLE NO.6.8
CASH FLOW STATEMENTS OF UGVCL
222
Amalgamation / Take over / Merger
Cash & Cash Equivalent of
- - - -
Subsidiaries under liquidations
Translation adj. on reserves / op cash
- - - -
balances frgn subsidiaries
Effect of Foreign Exchange
- - - -
Fluctuations
Closing Cash & Cash Equivalent 74.16 128.04 131.87 72.64
Analysis:
The above table no.6.8 presents the cash flow statement of UGVCL during the
study period 2010-11 to 2013-14. Cash flow after changes in working capital was
Rs. 558.37 crore, Rs.504.21 crore, Rs.171.73 crore and Rs.537.95 crore in the
year 2010-11, 2011-12, 2012-13 and 2013-14 respectively. It shows fluctuated
trend during the study period. There was sharp decline in the year 2012-13 in
cash flow after changes in working capital by 332.48 crore as compare to year
2011-12. It was increased by 213.25 % in 2013-14 as compare to 2012-13. Cash
flow from operating activities was Rs. 530.81 crore, Rs.501.28 crore, Rs.171.16
crore and Rs.536.37 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows fluctuated trend during the study period. It was increased
by 213.37 % in 2013-14 as compare to 2012-13. Cash flow from investing
activities was Rs. -222.05 crore, Rs.-293.09 crore, Rs.-549.74 crore and Rs.-
545.57 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14 respectively. It
shows progressive trend during the year 2010-11 to 2012-13. Cash flow from
financing activities was Rs. -301.05 crore, Rs.-148.95 crore, Rs.374.74 crore and
Rs.-44.68 crore in the year 2010-11, 2011-12, 2012-13 and 2013-14
respectively. It shows sharp fluctuated trend during the study period. Closing
balance of cash and equivalent was Rs.72.64 crore, Rs.131.87 crore, Rs.128.04
crore and Rs.74.16 crore during the year 2010-11, 2011-12, 2012-13 and 2013-
14 respectively. It shows the fluctuated trend during the study period.
223
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