FACULTY OF MANAGEMENT STUDIES

WSDOM, BANASTHALI UNIVERSITY

2013-2015

SUMMER TRAINING REPORT ON ANALYSIS OF WORKING

CAPITAL MANAGEMENT IN LIVING MEDIA INDIA LIMITED

(INDIA TODAY GROUP)

PREPARED BY: SHIPRA BANSAL

MBA 2nd Semester

Project Mentor:

Project Guide:

Ms. Sonal Purohit

Mr. C. K. Tyagi

Faculty Member

Manager Finance

Banasthali University

LIVING MEDIA INDIA LIMITED

ACKNOWLEDGEMENTACKNOWLEDGEMENT My project would be incomplete if at this

juncture, I do not acknowledge those who steered my project work

in the right direction.

Working on this project has been highly

knowledgeable for me because it has provided me an ample

knowledge about the working of the finance department in Living

Media India Limited and the over view of the entire media

industry in India.

Any comprehensive study like this must owe

credit to multitude of people. First, I would like to thank Mr.

Nitin Mandge (Training & Placement Officer) and other members of

the placement cell for giving me this opportunity to conduct this

project work.

I am indebted to my project guide Mr. Chitra

Kumar Tyagi and all members of their department “Mr. Vinod Chand,

Mr. Mukesh ,Mr. Rakesh Kumar , Mr. Mahendra Singh ” who made the

passage comfortable, and thanks to Mrs. Kiran, Mr. Krishan Kumar

Gautam, Mr. Ravinder, Mr. Dharmender, Mr. Anil goyal for this

incredible and valuable advice and inspiration rendered to me for

the preparation of this project.

It is natural to extend my appreciation to all

those who have been associated during this project and those who

made the passage comfortable, project enjoyable, and their time

available.

I am also deeply indebted to Prof. Aditya Shastri,

Vice-Chancellor, Banasthali University and Prof. Harsh Purohit,

Dean, WISDOM, Banasthali University for providing me opportunity

to pursue the project in the field of Managements and contribute

to the corporate community.

A special thanks to my parents, for their immense

support and encouragement to make this project a successful one.

PREFACEPREFACE

There are no lifts or escalators in the

world of success. There are only stairs leading from one level

to the next. There is no shortcut to success. Neither can

success come solely through luck or good fortune. To pluck more

than luck is essential for success, since fortune favors the

brave and not the fickle minded. in the nutshell, there is only

one way to achieve success and that is hard work performed as

per a wall conceived and imaginative plan.

“If knowledge is power, then knowledge applied is

power realized”. Post Graduation in Master of Business

Administration (MBA) is a professional course, which provides

the students with the intelligence, and power they need to

conquer the business world of this era.

As a part of the curriculum, the students are

required to undergo a practical training in a reputed business

organization for a stipulated period from 6 to 8 weeks. This

training gives a first hand knowledge and experience to the

student and helps them to know about the real business world. it

serves as a direct exposure to an organization and its ways of

functioning.

I have been really fortunate regarding my

summer training because I got an opportunity to work with one of

the biggest organization of this country, which is allied with

India Today Group. During the shot span of two months, I have

learnt a large number of things about the business world-the

sweet & bitter truth.

TABLE OF CONTENTSTABLE OF CONTENTS

S.NO. PARTICLERS

1. Executive Summary

2. WORLD MEDIA PVT. LTD.

3. Profile of Thomson Press

4. Profile of Living Media India Limited

5. Objectives of the Study

6. Detailed Job Profile (Learning during the

Training)Working Capital ManagementCMA ( Credit Monitoring Analysis )Loan Documentation Management Information System (MIS) Quarterly Information System (QIS)

Monthly Select Operational Data

(MSOD) Statement of Stock and Debtors Cash Flow Statement (CFS)

Daily Bank PositionBank GuaranteeSubscription (Local and Outstation)Bank Reconciliation StatementCash Management System (CMS)

Foreign Outward Remittance

7. Limitations

8. Future plans

9. Recommendations

10. Bibliography

THOMSON PRESS (INDIA) LIMITED

Thomson Press has been in operation for over 47 years and is

part of the India Today Group

A major multimedia company having interests in publishing,

internet, television and radio.

Over time Thomson press has emerged as the largest commercial

printer in South Asia with prestigious business houses as its

clients from all over the world.

Customer Service is taken care of by its wide network of sales

offices in Delhi, Mumbai, Kolkatta, Bangalore and overseas in

New York, London, and Melbourne.

Thomson press is a member of two prestigious World Bodies GATF

and PIRA. Revenue for the year 2005-2006 was us $50 million on

an asset base of us $ 34 million.

Thomson press (I) limited, an ISO 9002 company was

incorporated in 1967 with technical & financial

collaboration of Thomson International Corporation of

Canada, as a public limited concern with 51% equity.

Today it is recognized as India’s most well equipped and

comprehensive printing plant, employing a work force of

over 800 people. It possesses a unique infrastructure among

printing establishment in the country providing under

one roof, turnkey services for a range of printed work.

tp

Thomson Press (I) ltd. is one of the largest commercial

printing house in South East Asia . Thomson press has

worked to exemplary high standard of printing technology

with the use of latest state – of -art technology and

an excellent pool of talent, trained and highly

skilled work force led by dynamic managers and management

staff. Thomson press management has thereafter kept pace

with Japan, U.K., France, USA, Canada, Italy, Israel

etc., by close globalization with other printing

companies & equipment manufactures on a regular basis.

The company’s registered office is at k9 block, Connaught

Circus, New Delhi and the main unit is at Faridabad.

It facilities range from design

arrangements, high speed filmsetting, electronic scanning and

pre press proofing to sophisticated multicolor offset printing

and the latest binding and finishing product for print

product.

The company is commercial printer and

supplier of magazines like India Today, Business Today,

Computers Today, and Readers Digest. It also produces large

number of multicolor posters, brochures, folders annual

report, and company manuals apart from day to day activities.

Thomson press is also engaged in printing Cheques, security

bonds, and airline tickets.

The company has received national and

international recognition for delivering printed material by

stringent measures of on-line quality control on purchasing,

vendor evaluation and process controlled production

facilities with an eye for quality where the service is

customer driven.

A constant keeping pace with

technological advancements in every field of the trade has

been the Thomson’s policy since its inception. The last few

years in particular have been years of high technology

acquisition for the press.

THOMSON PRESS-PRINTING DIVISIONTHOMSON PRESS-PRINTING DIVISION

It was initially involved in the distribution of publications of

a large number of overseas publishers, and printing of

children's books for export. In 1974, the focus shifted to

printing of the group's prestigious publication India Today. As

of date apart from a number of prestigious magazines printed for

various publishing houses, Thomson Press also prints high

quality commercial items and books for the domestic and export

markets.

Each of their five units

have developed its own unique strengths and areas of expertise,

providing their customers with a strong support structure across

an extensive range of printing services.

Absolute commitment to

quality, meticulous attention to detail and unparalleled level

of service has made Thomson Press a leading specialist in

design, prepress, printing and distribution services. As a

company, they are committed to employ dedicated staff, investing

in the very best technology available and maintaining a close

involvement with the industry.

Thomson Press printing division comprises of one prepress and

two printing units in Delhi, one printing unit in Chennai and

one printing & book bindery unit in Delhi exclusively for

exports. The product range covers virtually all commercial print

requirements on paper and board, from bank instruments, to

calendars, diaries, books, corporate brochures, posters,

folders, leaflets, and magazines.

“QUALITY THROUGH PEOPLE AND“QUALITY THROUGH PEOPLE AND

TECHNOLOGY”TECHNOLOGY”

COMPANY’S VISION

“To maintain and be the acknowledged leader in printing through

consistent improvement in quality.”

COMPANY’S

MISSION

Quality through people and technology.

To ensure maximum satisfaction to the clients.

To maintain the ethical practices, legal, social, personal

conscience framework.

To recognize the customer’s right to quality, services,

timely delivery and cost.

To encourage individual growth to fullest potential.

To achieve high degree of efficiency and attain

international standards.

To ensure maximum satisfaction to the clients.

OBJECTIVES OF THE COMPANYOBJECTIVES OF THE COMPANY

Aim of Profit Maximization with customer satisfaction

To satisfy the demands of growing organization, employees

and the clients.

To ensure maximum satisfaction to the clients.

To maintain integrity & fair play.

To function as a model unit, follow all the laws

applicable, report profits and pay all the levied taxes.

To maintain an open information system & understanding

within the company and outside.

Processing unitsProcessing units

Our networkOur network

In India and abroadIn India and abroad

Corporate officeCorporate office

18/35 milestone, Delhi- Mathura, road

Faridabad, Haryana.

Production Units/ Operation SitesProduction Units/ Operation Sites

Thomson Press, 18/35 milestone, Faridabad

Print Export, C-35, Noida

Repro House, Okhla, New Delhi

3A. Okhla Extension Unit, K-13 Connaught

Circus, New Delhi

Thomson Security Printing (TSP), W 18-19, Sector 11,

Noida

Printing Unit, Maraimalai Nagar, Chennai

Electronic Publishing Export Unit, Nsez, Noida

Export Phototypesetting, Chennai

EPS Division,F-5,Sector 3,Noida

Printing Unit, Navi Mumbai

Sales offices (india)Sales offices (india)

1. Okhla, New Delhi.

2. St. Marks Road, Bangalore.

3. Mahim, Mumbai.

4. Calcutta.

Sales offices (overseas)Sales offices (overseas)USA

4 Court Square, 3rd floor

Long Island City

New York, 11101 Australia & New Zealand

o 3/1 Rothesay Avenue

Elwood, Victoria 3184

Australia

o Seven Oaks, 374 Wilson Street

Darlington, NSW 2008

Australia

UK

106A Signal House

6 Lyon Road, Harrow,

HA12AG, UK

THEIR TEAMTHEIR TEAM

Aroon Purie –Managing Director

An alumnus of the London School of Economics and a fellow of

the Institute of Chartered Accountants (England & Wales),

Aroon Purie is responsible for the strategic direction of

the company.

As founding Editor & Editor-in-Chief, India Today, Chief

Executive, the India Today Group and Chairman, TV Today

Network ltd., he sets the journalistic style for the largest

and most respected magazine publishing group in India and for

the premier 24-hour news and current affairs hindi news

channel, Aaj Tak.

He is associated with several

prestigious councils, amongst

them, as member, council of

management, audit bureau of

circulations (Chairman, 2000-

2001). He is on the executive

committee of the editors'

guild of India, council of

management All India Management Association (special invitee).

He was also chairman, CII National Committee on Media (2001-

2002).

Recipient of the national award, the Padma Bhushan in march

2001, he has received numerous other honours. these include,

the B.D. Goenka award for excellence in journalism (1988),

'Journalist of the year 1990' by Indian Federation of Small

and Medium Newspapers, the G.K. Reddy Memorial Award for

outstanding contribution to journalism (1993-94), and the Hall

of Fame Award from the Advertising Club of Calcutta (2002).

Mr C J Jassawala -Executive Director

C J Jassawala joined Thomson Press, Print

Business as Chief Operating Officer in

December 2006.

He did his post graduation in Human Resource

Management from XLRI, Jamshedpur and was selected to join the

Tata Administrative Services. Thereafter, he worked for 23 years

with Voltas (A Tata Group Company) culminating in his last

assignment there as Vice President - Operations and Business

Head. He carries a wide experience in leadership, team building,

turnaround management and business excellence.

As Executive Director - Printing, C J Jassawala is responsible

for print operations across 5 units in the country and offices

abroad..

Anil Mehra-Chief Financial Officer

Anil Kumar Mehra is a fellow member of the Institute of Chartered

Accountants of England & Wales and also of the Institute of

Chartered Accountants of India. He has been working with the

company and the group for more than 30 years and has considerable

expertise in the printing and multimedia industry.

His expertise ranges from advising companies on Financial

Management and rendering service in other areas of management—

including business consultancy, corporate planning and tax

planning.

He also holds the dual responsibility of Finance Director of the

India Today Group as well as Financial Advisor appraising all new

planned investments.

NATIONAL AWARDSNATIONAL AWARDS

Award Name : National Award for Excellence in

Printing by all India Federation of Masterprinters.

Year : 2002

Topic : Group - 'Offset Big' Category

Folders

Award Name : National Award for Excellence in

Printing by

All India Federation of

Master Printers.

Position : 2nd

Year : 2002

Topic : Group - Offset Category -

Book -Technical/

Medical

Award Name : National Award for Excellence in

Printing by

All India Federation

of Master Printers.

Position : 1st

Year : 2nd

Topic : Group - Offset Category - Book -

(Others)

SPECIAL AWARDSSPECIAL AWARDS

Award name : Special Export Award

Capexil

Year : 2000-2001

Topic : Books

Award name: Special Export Award by

Capexil

Year : 1996-97,1997-98

Topic : Typesetting

Award name : Special Export award by

Capexil

Year : 1994-95

Topic : Books

THOMSON PRESS SCHOOLTHOMSON PRESS SCHOOL  

 

The 'Training School' was started in 1995 with

an aim to produce printing professionals to meet

requirements of quality manpower. It provides a

four year course in printing technology where

both theoretical inputs and practical training

is imparted by professionals from the industry

as per the syllabi prepared by the Thomson Press

 

School governing body.

 

 

Students are given a monthly stipend and are

absorbed in various units on completion of the

course.

CAREER AT THOMSON PRESSCAREER AT THOMSON PRESS

Thomson Press, is a 'People's Company'. the belief

that 'human resources are the main drivers of the

organization' helped them in building a pool of

workforce, which is talented, dynamic, innovative,

creative and ready to accept challenges. People at

Thomson Press believe in exploring, nurturing and

developing the blooming buds into corporate

giants.Fresh recruits in the company are taken under

the following corporate training schemes.

Category : Management Trainee

Qualifications : Ph.d., MBA, ICWAI, CA

Duration of

Training :1 year

After Completion of

Training :Sr. Officer

   

Category :Graduate Engineer Trainee /

Junior Management Trainee

Qualifications :B.E./ B.Tech./ B.E.(PTG), MSW/

M.Stats.

Duration of

Training :1 year

After Completion of Asst. Officer

Training :

   

Category : Supervisor Trainee

Qualifications :Dip. Engg. (Mech./ Electrical/

Electronics)

Duration of

Training :2 years

During the period of training, fresh recruits are given

exposure to different facets in their respective field

of specialization as well as printing operations. They

also prepare and develop them to shoulder managerial

responsibilities.

With attractive remuneration structures and monetary

and non-monetary appreciation for performance, they

provide a clear career path for an individual to grow

and develop.

PRODUCT CATEGORIESPRODUCT CATEGORIES

To meet the varied requirements of their esteemed customers, they offer

a range of products that meet international standards. Their product

range :

Books

Annual Reports

 Monochrome and Multicolor

Commercial and publicity

 Coffee Table and Art Books

Materials

 children books

Brouchers and Catalogues

 

pamphlets and posters

Thin paper products

  Bible and Religious Literature

  Dictionaries and Directories

  Bhagavad Gita

  Quran

   

Dated products

  Diaries

  Calendars

 

Magazines and Periodicals

   

SERVICES AT THOMSON PRESSSERVICES AT THOMSON PRESS

Undoubtedly Thomson Press is a leader in handling large volume

multi colour work.

The product range covers virtually all commercial print

requirements on paper and board, from bank instruments, to

calendars, diaries, books, corporate brochures, posters, folders,

leaflets, and magazines.

This range of services and products covers designing, editing,

typesetting, high quality scanning and image manipulation, sheet

fed offset printing, heatset and coldset web offset printing,

automated binding, finishing, distribution and mailing

services.Thomson Press provides a complete service for mailing

and fulfillment, managing every aspect of the delivery service as

required by their customers. A number of options are available

from complex multiple personalized inserts to the largest

campaign and launch mailings. They aim to offer the most

comprehensive print management service available for them,

building close working relationships with customers goes much

further. Whatever the project, listening to their customers'

requirements and coming up with bright ideas and practical

suggestions to achieve a better result more cost-effectively is

all part of the service they provide.

Printing Capacities   2.8 million impressions per day on web  0.8 million impressions per day on sheet fed

Product Categories  Magazines  books (hard case and soft case)  diaries and manuscript books  Calendars  annual reports  leaflets, brochures, posters and other point of sale items  Maps  Directories

Binding Capacities  hardcase 25000 books per day  softcase 130000 books per day  saddle stitch 0.4 million books per day

Services  Design  Prepress  printing – sheetfed and web  automated binding  post printing finishing  mailing and distribution

COMPANY ASSOCIATESCOMPANY ASSOCIATESThomson Press has over the years acquired association

with large number of customers in India & Overseas.

The company is servicing the overseas customers’ needs

for printing and electronic publishing including

scientific publication, which is it’s core strength.

Living Media India Limited has its own publications like

India Today, Business Today, Computer Today, Teens Today,

Cosmopolitan printed at Thomson Press, which are

leaders in the country in their respective areas.

Following is a glimpse of our associates:

corporate houses & advertising agencies

magazines & publications

overseas clients

CORPORATE HOUSES & ADVERTISING AGENCIESCORPORATE HOUSES & ADVERTISING AGENCIES

Print requirements for major Corporate Houses in India such as :

Projects of major advertising agencies Projects of major advertising agencies

such assuch as

Bates

Lintas

R,K Swamy- Bbdo

Gray

Others Are:-Others Are:-

Itc

Becton & Dickinson

Lic of India

Nestle

Otto Burlington

Rediffusion

Mudra

Sahara airlines

State Bank of India

UCO Bank

Panjab & Sind Bank

Escorts

Modi Care

Times of India

MAGAZINES & PUBLICATIONSMAGAZINES & PUBLICATIONS

Press executes the demanding deadline and quality requirements

of:

All India Today Group Publications

Readers Digest

Amway

30 more magazines for other publishers

PRINT MEDIAPRINT MEDIA

India Today: English

India Today: Telugu

India Today: Malayalam

India Today: Hindi

India Today: Tamil

India Today Plus

Golf Digest

Cosmopolitan

Business Today

Time

India Today Travel Plus

MUSIC BUSINESS

Music today: audio cassettes & compact discs.

ELECTRONIC MEDIA

The company started diversifying in to the business of

electronic media in 1995. TV Today Network Ltd. launched

a 24 hour hindi news current affairs channel viz. –“Aaj

Tak”.the channel went operational in december 2000 & is

a highly popular channel.

OVERSEAS CLIENTSOVERSEAS CLIENTS

Kingfisher

Oxford University Press

Gulf Oil

Blackwell Publishing

Harper Collins

Cambridge University Press

Elsevier Science

Pearson Group

OTHER WORLD WIDE CUSTOMERS INCLUDEOTHER WORLD WIDE CUSTOMERS INCLUDEAddison Wesley

Ai Nisr Publications

Book Builders, Hongkong

Dorling Kindersley, U.K.

Elsevier Group, U.K.

Gordon & Breach Singapore

Gulf News, Dubai

Harcourt Brace Publishers

Inner Traditions, U.S.A.

International Publisher & Distributors

John Wiley

Octopus Group

Osho International (World Wide)

Promotional Reprint Company, U.K.

Reed Consumer Books, U.K.

Springer Verlag, Germany

UN’s International Children’s Education

Studio Editions, U.K.

Unicef.

major customers  Adidas

  gray  kingfisher  harper collins  pearson group  Bates  Lintas

  Hyundai  Samsung  hero honda   Hyundai  india today  readers digest

Amway

COMPETITORSCOMPETITORS

North

Ajanta Offset, Mehta Offset, Gopson, Dhriti Printers,

Newtech, Ipp(Delhi)

East

Art Printing, Naba Mudran , Nk Grossain ,.Lc Roy And

Anderson Printing(Calcutta)

West

Tata Press ,Comvay, Vakil, Repro(Mumbai) South

Mytech , Prasad, Pragati Printers(Hyderabad),

Coronation (From South)

For Pre-Press(Repro) Bussiness Competitors Are

North

Ajanta Offset,Ipp(Delhi)

East

Antartica And Repro Scan(Calcutta)

West

Com Art , Jessra, Unique (Mumbai)

South

Mytech And Print System(Banglore)

QUALITY POLICY OF THOMSON PRESSQUALITY POLICY OF THOMSON PRESS

They pledge to achieve customer satisfaction by continual

improvement in their processes and excellence in quality. They

wish to achieve this by:

Deploying specific, measurable and time-bound objectives in

all processes in various functions. 

Motivating their workforce for excellent standards in their

work procedures through kaizen.Committing suppliers to continually work on improvement in

quality standards.Working as a well-knit team to ensure that our quality

objectives are met.   

Role of quality assurance in thomson pressRole of quality assurance in thomson press

  Defect Prevention

    By setting standard:

   

 

Standard has been set as per the ISO 9001-2000

international quality system and has been certified from

BSI India Pvt. Ltd. The standard is being revised from

time to time whenever there is some improvement or

modification in the system.

    Ensuring adherence of the standard:

    Periodical audit of the system standard is being

conducted to check the compliance of the standard.

    Corrective and preventive action:

   

 

Every customer complaint is being thoroughly

investigated for its origin and reason. Necessary

corrective & preventive action is being taken in

consultation with the concerned departments.

  Defect detection

    By gathering data constantly on occurrence of defect:

    Every job undergoes thorough inspection before dispatch

as per the inspection plan & defect checklist.

    By sending information about defects to relevant

departments:

   

 

Daily, weekly & monthly reports are being sent to the

relevant departments and the same are being reviewed

periodically with the concerned departments.

INDIA TODAY CONCLAVEINDIA TODAY CONCLAVE

Started as a part of India Today’s 25th anniversary, India Today

Conclave was designed as a meeting point for the best minds from

India and around the world to map the geopolitical and economic

future of the country. In its inaugural year, the theme was India

Tomorrow 2002: Opportunities and threats with Vice President of

the USA, AL Gore as the Chief Guest. In its second year, the

theme is India Tomorrow 2003: Global Giant or Pygmy? With the

honorable William Jefferson Clinton, 42nd president of the United

States, presiding as the keynote speaker.

India Today Group Magazines

India

Today

English

 

India

Today

Hindi

 Busines

s Today 

Reader's

Digest

Golf

Digest

India

Cosmopolit

an

India

Today

travel

Plus

Design

TodayToday

Chartere

d

Accounta

nt

Time Fortune

LIVING MEDIA INDIA LIMITEDLIVING MEDIA INDIA LIMITED

The company was incorporated on May 9,1962 and the publishingbusiness started with the brand name India Today in 1975. Thepresent total annual turnover of the company is approx. Rs. 300crores. India Today is a news magazine which ispublished weekly in English and four other regional languages.The company diversified its publishing business by addingmagazines on business, technology, women, leisure etc. The IndiaToday Group is one of the largest magazine publishing houses inIndia with the brand name of India Today. The present combinedcirculation of all the editions of India Today magazines is over5 million per month. Additionally, the company produces music

cassettes/compact discs under the brand name of “Music Today”. Ithas a large number of titles. It is a matter of great satisfaction thatall the products of the company have been established as marketleaders and its publications renowned for its qualityreproductions. The company’s strategy is to maintain itsleadership in its publications and also to pursue its operationsin areas which are relevant in the changed market price.

Organization and Management

The company is managed by a Board of Directors. All functions areheaded by professional managers supported by highly qualifiedstaff and technical personnel to implement corporate policies.Some of the key personnel are:

Mr.Aroon Purie- Editor In ChiefMr.Dinesh Bhatia - Group Executive And Finance DirectorMr.Ashish Bagga- Publisher & Executive Director

Employee Demographics

The company employs approx. 4000 people . It has a record ofhealthy industrial relations.

BUSINESSES OWN BRANDS

India Today

Business Today India Today Travel Plus Money Today

SUBSIDIARIES

Television Today Network (NSE ticker - TVTODAY.NS) owns

o Aaj Tak o Headlines Today o Dilli Aaj tak o Tez o Meow FM

Thompson Press , printing business, which prints magazines for several contemporaries and competition

Music Today , Music publishing business

JOINT VENTURES / FOREIGN BRANDS

LMI, also has several Joint ventures/Licensing agreements with prominent brands for their Indian editions, which include

Mail Today , a joint venture with Daily Mail Cosmopolitan Prevention Good Housekeeping Golf Digest Men's Health Reader's Digest Harvard Business Review

PUBLICATIONSPUBLICATIONS

India Today (English) , With a circulation of 465,638, it is

the highest read publication. It commands a readership of

41,94,000 as per the National Readership Survey 2003 (NRS

2003). In its 30 years of existence, it has associated

itself with every section of the society. It has set

standards in its every endeavor and captured the pulse of

the nation. India Today breaks from the mould of a news-

reporting magazine to an information and analysis driven

magazine that has direct relevance for the readers. The

magazine’s leadership is unquestioned so much so that India

Today is what Indian Journalism is judged by.

India Today is also available in four language editions:

Hindi (readership figures: 59,99,000) Tamil

(4,23,000); Telugu (7,95,000) Malayalam (9,52,000).

India Today International, an edition of the weekly

newsmagazine, is circulated in 104 countries worldwide and

has special editions for North America, the United Kingdom,

the Gulf and South East Asia.

Business Today

Each issue is a fine balance between the investigative and the

trendy, the informative and entertaining, and the analytical and

the perspicacious, always keeping in mind the twin concerns of

relevance and topically.

Business Today has acquired a well-deserved

reputation for trend spotting. When required its features provide

an overview of business and when required they pay attention to

the slightest detail. The result is a product that while not

being focused on one section of the economy (at the cost of the

exclusion of the others) looks at it in its entirety.

Today, Business Today is India’s no. 1

business magazine. Its readership, as per the NRS 2003 results

has scaled new heights and has soared to an unprecedented 9.5

lakh. Even the latest is IRS round 1; 2003-04 establishes

Business Today as the clear winner in the business magazine race.

Reader’s Digest

It is the world’s best-selling magazine, with 48 editions in 19

languages and a hundred million readers around the globe. It is

published by the India Today group in India and Nepal, since

October 2003, under a license granted by the Reader’s Digest

Association Inc., USA. The magazine has seen strong growth in

recent years, with the print order of the Indian edition of the

magazine currently at 530,000.

Cosmopolitan

It is the world’s number one magazine for young women, and holds

aspirations and dreams for young women the world over. In over

100 countries and printed in 26 languages Cosmo speaks in one

voice-a-voice that is worldly adventurous and confident.

Since its launching in India in

1996, under license from Hearst USA, Cosmopolitan is one of the

leading magazine’s for young women and acts as a guide, a mentor,

a style barometer and a trend setter giving its readers that zing

which will make them stand out from the crowd.

Good Housekeeping

Published in India under license from Hearst USA, Good

Housekeeping brings its readers a wealth of information and

advice on a breadth of subjects ranging from food, home and

family to fashion, relationships, health and beauty. Warm,

entertaining, and often surprising, it also takes a lighter look

at everyday life, acknowledging and sharing its reader’s

experiences.

Good Housekeeping keeps its readers

up to date. It balances practical solutions with achievable

inspiration. Stylish, classic yet always-contemporary Good

Housekeeping is a uniquely rewarding magazine.

India Today Travel Plus

It has emerged as the country’s top travel and lifestyle

magazine. Every month it brings to its readers luxury travel,

exotic destinations, haute cuisine, gadgetry, and more. It is

written for the world travelers, with first hand accounts from

well-known writers around the world. In the past, it has carried

a number of very well received supplements on Kerala, the North

East, Arunachal Pradesh, and also on gourmet cuisine. The finest

in travel and more is clearly the claim that the magazine

attempts to live up to.

Golf Digest India

It is the Indian incarnation of the best known and world’s no. 1

of Golf Publication – Golf Digest. It is a ready reckoner for

golfers at all skill levels with information on ‘how to play,

what to play and where to play’. It draws on the experience and

tips from an impressive array of golfing superstars like Tiger

Woods, David lead better, Tom Waston, Phil Mickelson. The Indian

edition augments the unmatchable content of its us parent with a

customized Indian section that focuses on golf in the country

covering the game from every conceivable angle.

Time

The world’s leading news magazine is marketed and distributed in

India by the group since 1991. It has a weekly circulation of

over 35,000 copies in the country. The group also manages the

advertising business from India for their global editions.

Today

Launched on April 29, 2002, it is the group’s first venture into

the newspaper market. Today is the espresso newspaper created

specially for the urbanite of the SMS generation looking for the

biggest buzz in the shortest time. Interestingly written,

visually appealing and almost all-color, this 16-page afternoon

tabloid is published Monday to Friday. Its unique city focus

means when it comes to making Delhi a better place, Today stops

at nothing whether it is spotlighting the glam or uncovering the

latest scam. Using an innovative door-to-door distribution

network Today is now India’s fastest growing afternoon newspaper

and Delhi’s no. 1 afternoon newspaper.

INTERNETINTERNET

India Today Group Online (ITGO) publishes the online editions of

the India Today Group’s publications, and is the enabler of the

group’s e-commerce portals – Art Today, Music Today and India

Today Book Club and also web casts Aaj Tak, India’s no.1 news

channel. ITGO has also been a pioneer in the format of delivering

content through mobile phones. They are currently offering

various news updates to customers who are interested in convent

from the group. The division has also gained expertise in

running contest campaigns for the entire group. They are also

very proud of the fact that they enabled Aaj Tak to enter the

Limca Book of Records by clocking an amazing 10 million SMS

responses. Then, an exclusive tie-up with Airtel has resulted in

the first-ever push-based subscription service called Airtel

Today. Now Airtel Subscribers can pay a monthly fee and get

daily updates on a range of different subject like news, business

news, sports news, astrology forecast, health tips, filmi gossip

and jokes.

Syndications Today,

It is the arm of the India Today Group that caters to content

demand from media, publishers, websites, ad agencies,

international databases, authors and researchers. The group has a

strong network of journalists and photo journalists spread across

the globe, so when it comes to sourcing reliable content and

photographs from India, Lexis, Dow Jones, internet securities,

financial times, Reuters and many more rely on them.

TELEVISIONTELEVISION

Aaj Tak, the 24-hour Hindi news & current affairs channel was

launched on 31st December 2000. Aaj Tak has emerged as a clear

pacesetter in the world of news within this short span, and today

stands as India’s best news channel. Aaj Tak created a totally

new idiom in news television in India, which was completely

different. Aaj Tak today boasts of having reached out to over 30

million homes across the country and presently has a 50% higher

channel share than its nearest competitor.

As on today, the TV news industry has evolved considerably in

nature as well as size, but Aaj Tak continues to maintain its

unparalleled leadership. This excellence in content &

communication of the channel has been recognized and rewarded by

industry and viewers alike. Testimony to this has been the

innumerable awards Aaj Tak has won in the past few years. Apart

from providing it’s many viewers with the latest & best in news

coverage, constant interactivity with them has always been

priority at Aaj Tak. The mission of the channel to capture news

at fast as possible from every corner of India in fields ranging

from politics to entertainment in the most imaginative, memorable

and accurate manner. Aaj Tak captures the drama of change

anywhere-anytime, and delivers it to the people first. The

newsgathering setup is complemented by state-of-the-art

technology that includes lightweight cameras, on-line editing,

newsroom automation & 3d-graphics. The channel has a live uplink

facility from all the bureaus and OB vans to cover live breaking

news. To add to this editorial force, Aaj Tak is complemented by

the expertise of India’s premier content company, the 25-year-old

India today group.

Headlines Today

The channel aims at introducing a new and path breaking format in

electronic news journalism. It was very aptly christened at

Headlines Today as it seeks to be a provider of concise and fresh

news to a mass of highly educated, predominantly urban and a time

conscious set of people. Recognizing the need of the modern

Indian to be abreast of the latest in happenings around him and

yet be able to do so without wasting hours in doing so, headlines

today emerged as the unparalleled answer to all their concerns.

Headlines Today has a short programming

wheel which is power packed with the latest and best news

coverage in politics, business, sports, health, science &

technology and entertainment offering not just the best of

national but also international coverage. The channel’s brand

proposition is clearly reflected and captured in its message

“sharp news for sharp people”.

RADIO

The India Today group added yet another feather to its cap when

it introduced “Asli Masti” to Delhi and Kolkata, The radio

station launched its round the clock services in Delhi on 29th

April, 2003 and in Kolkata on 3rd May, 2003, besides being in

operation in Mumbai since July, 2002 and has been entertaining

the populace of the cities ever since. A radio station with Asli

attitude,is turned to every need of its listeners. With a

combined reach of over 40 lakh listeners in the three cities,

popularity continues to soar.

MUSICMUSIC

Music Today has since its inception in 1990 taken the lead in

preserving and promoting India’s rich musical heritage and

emerged as the most prestigious label in the Indian Music

segment. Music Today’s vast repertoire includes Hindustani &

Carnatic music, light-classical & devotional music. The label has

boosted other genres from India’s abundant heritage, drawing from

Sufi, folk and regional lines and initiating the move into world-

class new age music that derives vastly from India’s mystical

tradition & amazing range of musical instruments.

Music Today has now ventured into film music and

pop music a well. Music Today’s success in presenting & making

Indian music more accessible to newer audiences is clearly seen

in its innovative thematic packages. This unconventional

approach, melded with state of the art digital recording and

international quality CD and audiotape productions, has over the

years made Music Today synonymous with the best Indian music in

India & the world.

EDUCATIONEDUCATION

Vasant Valley School opened in New Delhi in 1990 with 200

students and a staff of 19. Today, there are around 1200 students

and a staff of over 160. The school believes that education is a

preparation for life and is a lifelong process that challenges

students and teachers to exceed their own expectations.

Vasant Valley School is committed to developing proactive

citizens. The longer working day enables the school to implement

the multiple intelligence theory. The academic programme of the

school is geared not just towards the CBSE examination but

transcends it so that the individual interests of the students

are developed and they become torchbearers of tomorrow. The

school organizes many activities throughout the year where

qualities such as leadership and self-discipline are inculcated

in 1997. Vasant Valley opened a center for hidden with special

needs, with a multi-disciplinary team of professionals. These

children are trained in life skills and many have been

successfully integrated into regular school systems.

PRINTINGPRINTING

Thomson Press started in 1967, is the largest commercial printer,

integrated printing and allied services company in the Indian

sub-continent, with multi-colour web and sheet-fed presses.

Thomson Press employs state-of-the-art equipment and highly

skilled technicians. Some of them have graduated from Thomson

School of Printing, which offers a 4-year course in printing

technology. Thomson Press prides itself in creating customized

solutions for long term by allocating permanent resources to

clients. The company offers a range of services from scientific

photo-typesetting, page designing and digital imaging in pre-

press to sheet-fed and web offset printing, automated binding,

finishing and distribution management – all under one roof. The

unique one-stop shop structure and meticulous attention to detail

and quality has made in the press of choice. Specialized units at

Thomson Press handle digital data processing and conversion for

well-known international publishers of technical journals such as

the Elsevier Group, American Institute of Physics, John Wiley and

Mcgraw Hill who are their satisfied customers.

Thomson Press has specialized security

printing unit for printing bank documents, bank cheques and

airline tickets. Thomson press has its operations in NCR and

Chennai, South India. Western Bridgehead in New Mumbai will also

be fully functional from January 2005.

PUBLIC WELFAREPUBLIC WELFARE

Care today fund was the set up by the India Today Group to do

more than report about the tragedies that take place around us.

It was set up to do something about the tragedies and lighten the

burden of the worst affected victims. It was set up so that the

readers and viewers could be involved and could contribute with

the knowledge that the contribution was being used judiciously,

and would have an impact on the lives of the victims. In the five

years since Care Today’s formation, four special programmes have

been launched. The hope for Orissa fund has worked with orphans

and widows from the 1999 super cyclone, and also built shelters

for coastal communities to ensure that disasters do not cause

such damages in the future. The fight against the drought fund

worked towards sustainable solutions for drought-effected

communities in Western Rajasthan and Northern Gujarat.

OBJECTIVES OF THE STUDYOBJECTIVES OF THE STUDY

The basic purpose of the study is to get an insight of the

Finance Department of Living Media India Limited (part of India

Today Group of Companies). The main objectives are:

To understand the work culture, duties and tasks performed byeach and every individual of the Finance Department.

To understand the Working Capital management of theOrganization

To analyze Cash Management System and Quarterly InformationSystem.

To analyze the basics of Management Information System andBank Reconciliation System.

To analyze the procedure and Documentation involved forobtaining Loans and the terminology used in such documents.

To understand the linkages between the various departments ofthe organization.

To learn various things which come across while dealing inFinance.

Understanding of Stock and Debtors Statement and MonthlySelect Operational Data prepared by the company on monthlybasis.

Report is prepared with the objective that it is helpful forvarious parties like

The researchers can use the study for the further analysisand recommendations.

The company executives can utilize the training report forthe purpose of Financial Management.

The training students can use the report to undergo thevarious accounting concepts.

G M Finance (Mr. Dinesh Sehgal)

Manager FinanceMr. C.K Tyagi

Finance Team

HIERARCHY- FINANCE DEPARTMENTHIERARCHY- FINANCE DEPARTMENT

Mr. Mahender Mr. Rakesh Kumar

Mr.Mukesh

CFO (Mr. Dinesh Bhatia)

Mr. Vinod Chand

Activities handled by officers inActivities handled by officers in

finance department (living media indiafinance department (living media india

limited)limited)

Mr. C.K Tyagi : Quarterly Information Statement,

(MSOD) Monthly Select

Operational Data,

Statement of Stock and

Debtors.

: Loan Documentation,Cma

(Credit Monitoring Analyis)

Bank Reconciliation

Statement, (Supervises Overall Functioning Of The

Department)

Cash Flow Statement, Funds Flow Statement,

Daily Bank Position, Bank Reconciliation

Statement, Funds Monitoring

Rakesh Kumar : Posting of Outstation Cheques and

Bank Reconciliation Statement

Bank Reconciliation

Statement, Management Information System,

Mr.Vinod Chand : Guarantee, Bank Reconciliation

Statement,

Mr. Mahendra Dagar : Bank Reconciliation Statement, Interest

Calculation, Foreign Payments and Foreign

Cheques,

Mr. Mukesh: Management Information System, Interest

Calculation.

WORKING CAPITAL MANAGEMENTWORKING CAPITAL MANAGEMENT

Working Capital Management involves the affiliation between a firm’s

short-term assets and its short-term liabilities. The goal of working

capital management is to ensure that a firm is able to continue its

operations and that it has sufficient ability to satisfy both maturing

short-term debt and upcoming operational expenses. The management of

working capital involves managing inventories, accounts receivable and

payable, and cash.

Short term Assets (Current Assets) are resources, which

are in cash or will soon be transformed into cash in “the ordinary

course of business”.

Short-term liabilities (Current Liabilities) are

commitments, which will soon require cash settlement in the “ordinary

course of business”.

Current Assets Current Liabilities

Liquid Assets Bank Overdraft

(Cash and Bank deposits)

Inventory Creditors

Debtors & Receivables Other Short Term

Liabilities

Thus:

WORKING CAPITAL = CURRENT ASSETS – CURRENT LIABILITIES

WORKING CAPITAL CALCULATION

Working capital is the single best method of determining the

position of a company, or how well that company may be doing.The

more working capital a company has the better that company is

doing, financially. Many potential

investors and others in the public sphere will scrutinize a

balance sheet to find the working capital calculation of a

company.

Current assets and current liabilities include three accounts

which are of special importance. These accounts represent the

areas of the business

where managers have the most direct impact:

Accounts Receivable (current asset)

Inventory (current assets),and

Accounts payable (current liability)

An increase in working capital indicates that the business has

either

increased current assets (that is received cash, or other

current assets) or

has decreased current liabilities.

Sources of additional working capital include the

following:

Existing cash reserves

Profits (when you secure it as cash )

Payables (credit from suppliers)

New equity or loans from shareholders

Bank overdrafts

Long-term loans

Short –term loans

DECISION CRITERIA

Working capital is the amount of capital which is readily

available to an organization. That is, working capital is the

difference between resources in cash or readily convertible into

cash (Current Assets) and cash requirement (current

liabilities). So the decisions relating to working capital are

always current decisions , i.e.,short term decisions.

The short term decisions of the firm are similar to those of

long term in terms of risk and return, but they differ in many

other ways like time factor,discounting consideration, liquidity

etc. So these decisions are not taken on the same basis as long

term decisions. These decisions have different criteria like

cashflow and profitability.

The most important criterion for making short term decisions is

cash flows. And the best measure of cash flow is net operating

cycle or cash conversion cycle. It represents the time

difference between cash payment for raw materials and cash

collection for sales. Another aspect of cash conversion cycle is

gross operating cycle is gross operating cycle which is same as

net operating cycle except the fact that it does not take into

account the creditors deferral period. Cash conversion cycle

indicates the firm's ability to convert its resources into cash.

Because this number effectively corrosponds to the time that the

firm's cash is tied up in operations and unavailable for other

activities, management generally aims at a low net count.

If you ....... Then ......

Collect receivables

(debtors) faster

You release cash from the

cycle

Collect receivables

(debtors) slower

Your receivables soak up

cash

Get better credit (in terms

of duration or amount) from

suppliers

You increase your cash

resources

Shift inventory (stocks)

faster

You free up cash

Move inventory (stocks)

slower

You consume more cash

MANAGEMENT OF WORKING CAPITAL

Management will use a combination of policies and techniques for

the management of working capital. These policies aim at managing

the

Current assets (generally cash and cash equivalents, inventories

and debtors) and the short financing, such that cash flows and

returns are acceptable.

Cash management. Identify the cash balance which allows for the

business to meet day to day expenses, but reduces cash holding

costs.

Inventory management. Identify the level of inventory which

allows for uninterrupted production but reduces the investment in

raw materials – and minimizes reordering costs.

Debtors management. Identify the appropriate credit policy, i.e.

credit terms which will attract customers, such that any impact

on cash flows and the cash conversion cycle will be offset by

increased revenue and hence return on capital (or vice versa).

Short term financing. Identify the appropriate source of

financing, given the cash conversion cycle: the inventory is

ideally financed by credit granted by the supplier; however, it

may be necessary to utilize a bank loan ( or overdraft , or to

“convert debtors to cash” through “factoring”.

ANALYSES OF WORKING CAPITAL

(A) Schedule of changes in Working capital

(B) Funds Flow Statement

© Cash Flow Statemnt

( D) Ratio analyses

1. Current Ratio = Current Assets

Current Liabilties

* around of 1.45 *

2. Quick Ratio = Liquid Assets

Current Liabilities

* around of 0.6 *

Activity Ratio :-

1. Working Capital Ratio = Cost of goods sold

Working

Capital

* around of 1.1 *

2. Stock Turnover Ratio = Cost of goods sold

Average

Stock

Inventory holding Period = Days/Months

S

TR

* IHP around of 90 days *

3. Reciable Ratio = Credit sales

Average

Debtors

Average Collection Period = Days/Months

Recia

ble Ratio

* ACP around of 60 to 90 days *

4. Payble Ratio = Credit Purchase

Average

Creditors

Average Payment Period = Days/Months

Payble

Ratio

* APP around of 90 days *

Why Firms Hold Cash:The finance Profession recognizes the three primary reasons to explain

why firms hold cash:

Speculation Precaution Transaction

Speculation:

The reason for holding cash is to create the ability for a firm to take

advantage of special opportunities that if acted upon quickly will

favor the firm. An example of this would be purchasing extra inventory

at a discount that is greater than the carrying costs of holding the

inventory.

Precaution:

Holding cash as a precaution serves as an emergency fund for a firm. If

expected cash inflows are not received as expected cash held on a

precautionary basis could be used to satisfy short-term obligations

that the cash inflow may have bench marked for.

Transaction:

Firms are in existence to create products or provide services. The

providing of services and creating of products results in the need for

cash inflows and outflows. Firms hold cash in order to satisfy the cash

inflow and cash outflow needs that they have.

CMA DATA FORM (CREDIT MONITORING CMA DATA FORM (CREDIT MONITORING

ANALYSIS)ANALYSIS)CMA Data information is to be provided by a company to banks about its

past performance and the future plans and projections. The format of

CMA is more or less common for all the banks. But some banks can

incorporate additional details.

Usually it is prepared on yearly basis but it may

also be prepared twice in a year. It incorporates information for

previous two years and the succeeding two years so that an idea

about firm’s management of funds can be easily ascertained. Also

the company’s funds requirement can be easily ascertained on the

basis of which banks take the decisions to sanction the loans.

*Attached is the Performa of CMA data form in which most of the items

are usually obtained from the current and previous year’s balance

sheet.

CURRENT RATIO is the important ratio computed and considered by

the bank through CMA DATA through which it can analyze the firm’s

performance for previous years and also for the coming years

Current Ratio = Current Assets

Current Liabilities

Minimum ratio for this should be 1.33; ratio below this doesn’t

indicate healthy position of the firm.

Main document in CMA is STATEMENT of MAXIMUM PERMISSIBLE BANK

FINANCE. Through its help, overdraft limits are sanctioned by

bank to the company.

CMA DOCUMENTS

Profit & Loss A/CBalance SheetsStatement Of Current Assets And Current LiabilitiesMaximum Permissible Bank FinanceFunds Flow Statement

Funds flow statement (ffs)A statement of Sources and Application of funds that summarizes

the financial position including the sources from which funds

were obtained by enterprise and the specific uses to which such

funds are applied.

This statement discloses what the main sources of funds were and

how these funds were utilized during the year. Thus, by preparing

this statement, the management can find out the basic reasons for

changes in the assets, liabilities and capital of the firm

between the dates of two balance sheets.

Objectives of FFS :

1. Helpful in analysis of financial position : A Fund Flow

Statement is prepared to give satisfactory answers to the

following questions:

a) Where did profits go?

b) Why were dividends not larger?

c) How was it possible to distribute dividends in excess of

current earnings or in the presence of net loss for the

period?

d) Why are the net current assets down though the net income is

high?

e) How that is the net current assets are up even though there

is a net loss for the period?

f) How was the expansion in plant and equipment financed?

g) how was the increase in working capital financed?

2. 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.

3. It helps in the preparation of budget for the next period:

If 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 sources. This is helpful in preparing the budgets for

the future period.

4. It helps a firm in borrowing operations: Bankers and other

institutions, before extending any loan to a business firm,

want to satisfy themselves whether the firm will be able to

repay the loan installments on the due dates or not. A Fund

Flow Statement prepared for the future period indicates whether

the company will have sufficient funds to repay the loans or

not.

5. It supplements the information contained in the financial

statements:

Funds Flow Statement acts as an important supplement to Profit

& Loss Account and Balance Sheet because it explains the

changes in the financial position during a financial year.It

also explains the reasons of these changes.

6. It indicates what resources are available for the purchase

of fixed assets.

7. It may suggest ways the net working capital position can be

improved.

8. It can be used in planning for the repayment of long term

debts.

9. it helps in the planning of the temporary investment of idle

funds.

LOAN DOCUMENTATIONLOAN DOCUMENTATION

Major task of the Finance department of is to arrange enough amounts of

funds all the time so that none of the operations of the firm should

face any obstruction due to lack of funds.

Finance department has the major task of

arranging various Working Capital Loans and Term Loans for its

operational purposes.

DOCUMENTS REQUIRED FOR LOAN DISBURSEMENT

Accepted sanction letter duly accepted by authorized signatories

Certificate to be true copy of board resolution

Demand promissory note

Letter of continuity (if there is a renewal)

Facility cum hypothecation agreement

FCNR (B) agreement (if there is a foreign currency loan)

Form no.8 (for filling of charge for hypothecation of assets with

registrar of companies)

Pari Passu letters

Memorandum of Association and Articles of Association

Auditor’s certificate

Insurance with endorsements in favor of bank

Agreements relating to (if any) short term rupee loan, bank

gurantee, letter of credit, term loan.

BANKERS

1. Canara Bank

2. State Bank of Travencore

3. The Bank of Nova Scotia

4. ABN AMRO Bank

5. HSBC (Hongkong & Shanghai Banking Corporation Limited)

6. Standard Chartered Bank

7. UCO Bank

8. ICICI Bank

9. ING Vysya

10. HDFC Bank

11. IDBI Bank

12. PNB

13. Corporation Bank

14. Indian Overseas Bank (IOB)

15. Syndicate Bank

Various important terms involved in loan documentation

are: Fund based facilities : Involve funds. These are the

facilities availed by an organization through a bank, like

LMIL enjoys overdraft facilities from various banks. Cash

Credit generally through Short Term Rupee Loan and FCNR(B).

Fund based

facilities

SECURED UNSECURED

(Against which stock and debtors (no such

hypothecation is there)

are hypothecated)

Non Fund Based Facilities : It does not involve funds. It

includes letter of credit (used for imports), bank

guarantee.

Cash Credit: These are the limits up to which you can

withdraw from bank (as per agreed terms and conditions) and

withdrawl beyond this limit will bear a penal rate of

interest.

FCNR: ( Foreign Currency Non Repatriable) When NRI sends fund

to India and can’t take them back, then these funds are used

for lending purpose, banks lend them to various firms. The

Indian corporate/firms are allowed to raise the funds

through foreign currency loans within the existing policy

guidelines of the RBI.

Key Benefits:

1. At times, it may entail lesser interest cost vis-à-vis Rupee

borrowings.

2. The borrower is not required to go to the international market

for raising the funds, as foreign currency funds are made

available in India reducing the cost of raising such funds.

3. Corporate Sector can avail the advantage of FCNR and can avail

the loan in the form of foreign currency i.e. in the form of

Pounds, Dollars, and Euro etc. Rate of interest on these loans

are controlled by LIBOR.

Short term prime lending rate (STPLR): Rate of interest plus

some margin added to it is the so obtained rate, which is

charged by banks to customers. It is the normal market rate

of interest, which may varies from bank to bank depending

upon the availability of the funds with them and their

capacity of borrowing.

Gearing ratio: Total Debt

Net Worth

Total Debt= Bank loans + other outside debt

Net Worth=Share capital + general reserve + other

reserves.

Letter Of Credit : A Seller May Request That A Buyer Provide

Them With A Letter Of Credit Which Must Be Obtained From A

Bank And Which Substitutes The Bank Credit For Their

Client’s. In the event of buyer’s default, the seller’s risk

is mitigated and has recourse of recovery from bank. Bank

accepts full liability in both cases. The beneficiary under

the Bank Guarantee can recover the money from the bank at

the default by the other party. While in Letter of Credit,

Bank collects the money for the beneficiary.

Margin : It is that percentage of the security i.e. stock and

debtors (Hypothecated to bankers) which is not financed by

the bank i.e. bank keep the Margin on the securities

provided against Working Capital facilities.

PARI-PASSU Charge : This term is frequently used in those

cases where the company avails loans from more than one

bank. In these cases the security offered by the company

against those loans from various banks shall be

proportionately divided on PARRI-PASSU basis i.e. according

to the amount of loan availed and not on equal basis.

PARI-PASSU letter is a confirmation letter

which every bank sends to other concerned bank for

confirmation of credit limits given by them to a particular

firm.

Short Term Rupee Loan (STRL): It is a part of cash credit

limit and for a short period which can extend from 7

days to maximum 1 year. If a company wants to repay the

loan amount, before the expiry of its maturity date,

then the organization has to pay penalty (as per agreed

terms and conditions) for the remaining period.

Roll Over: is a term used to extend the loan period. Rate

of Interest (ROI) charged on STRL is decided by the

agreement between RBI and commercial bank. Margin is addedto this ROI and interest rate to be charged on STRL is

formed. This interest rate is called call money rate.

Business Day: A day on which financial markets in Mumbai

are open for dealings in foreign currency deposits between

banks.

Drawdown : is the initial advance of the facility availed.

Interest Determination Date: In respect of an interest

period, the first day of such interest period.

LIBOR: London Interbank Offered Rate, which is fixed by BBA.

(British Banker’s Association) In respect of each interest

period, the rate as determined by the bank on relevant

interest determination rate as being the offered rate quoted

in LIBOR.

MANAGEMENT INFORMATION SYSTEM (MIS)MANAGEMENT INFORMATION SYSTEM (MIS)

MIS is an interrelated computer-based, software, and

telecommunications system that collects, processes, stores &

distributes information to support decision making, control,

analysis, planning, and learning in an organization.

MIS is a product of a multi-disciplinary approach to the

business management. It is a product which needs to be kept

under the constant review and modification to meet the

corporate needs of information. It is an effective measure of

cost control.

Information processing is a major societal activity.

Significant time is spent on reading, searching for, and

analyzing information.

On an average, 80% of the time of an executive is spent in

the processing and communication of information.

Society is becoming information dependent.

Knowledge workers constitute a significant proportion of the

work force – their duties involve production and use of

information: documents, reports, analyses, plans, etc.

MIS in Living Media India Limited

Management Information System in Living Media India Limited

reflects statement of expenditure (cost center wise, activity

wise & location wise) bifurcated on the basis of

Vehicle Expenses (Petrol + Repairs)

Telephone Expenses

Conveyance Expenses

Entertainment Expenses

Traveling Expenses

Publishing Expenses

Advertisement & Publicity Expenses

These expenses are further segregated department wise:

Editorial

Advertisement Procurement

Production

Sales

Subscription

Marketing

Administration

Vehicle Expenses include petrol, repair and parking

expenses of the vehicles provided by the organization

to its employees.

Telephone Expenses include expenditure incurred on

office direct phone lines, board lines, internet,

broadband connections, residence phone lines provided

by the organization, modem, cellular & blackberry

connections provided by the organization.

Conveyance Expenses include all local conveyance

expenses pertaining to staff, clients and guests.

Entertainment Expenses include all hotel & restaurant

expenses incurred for entertaining business clients,

company’s guests and staff parties.

Travelling Expenses include air fare (including

accommodation, food, entertainment etc) on a business

trip for employees and other than employees i.e.

models, freelancer, artists and company’s guests.

Publishing Expenses include amount paid to writers and

artists, consultancy fee, articles, opinion poll,

retainer ship fee, editing and expenses incurred on

survey (latestly India Today Group conducted a survey

on finding the top 10 best management schools)

Advertisements and Publicity includes expenses on

hoardings, stickers, posters, banners, gift items, ads

given in TV, radio, cable networks, in house ads, glow

sign boards, artwork and design and promotion mailing

etc.

For the rationale of preparing MIS, details of each & every

expense is booked by accounts department, details of these

expenditure are then forwarded to the EDP (Entry Data Processing)

department for punching entries into the computer system and then

whole expenditure reports are forwarded to the Finance Department

in the form of statements.

Finance Department then prepares

the abstract statement of all the expenses so that top management

can have the bird’s eye view about the increase/decrease in

various expenditures.

*Attached is a performa of MIS, prepared by the finance

department, which gives a fair idea about the information.

IMPACT OF MIS

Increased efficiency in the management functions:

- marketing, - finance, - production, - personnel,etc.

Tracking and monitoring of the functional targets becomes

easy.

Functional managers are continually informed about the

progress, achievements, and shortfalls in activities

and targets.

Probable trends in various aspects of business helps

in forecasting and long term prospective planning.

A proper design of an mis results in a better

understanding of the organization itself.

MIS calls for a systematization of the business

operations and leads to the development of a high

degree of professionalism in an organization.

An open system MIS offers an ability of continuous

adjustment/correction in the system in line with its

operational environment.

It helps management accounting to ensure the

correctness and validity of data, e.g. Double entry

book keeping, trial balance, balance sheet, and other

books of accounts

It continuously interacts with the internal and

external environment of the business and provides a

corrective mechanism in the system so that the changed

needs of information are met with effectively.

Ultimately, MIS helps in achieving Organization Goals

QUARTERLY INFORMATION SYSTEM (Q.I.S)QUARTERLY INFORMATION SYSTEM (Q.I.S)

In the Finance Department of Living Media India Limited,

quarterly Information System is used. It includes the statements

which are prepared for the banks so that they can compare the

company’s performance for the forthcoming quarter with the

estimates given by the company. This statement is required by the

bank to assess the performance of the firm.

The whole picture about the quarterly and half yearly

performance of the firm is presented in three forms. All the

items included in these forms are taken from the budgeted

statements, profit and loss account and balance sheet.

Q.I.S FORM I: This form includes the estimated (budgeted)

amount of related figures and is submitted to the bank at

the beginning of every quarter.

Q.I.S FORM II: This form is to be submitted at the end of every

quarter, which involves the comparisons between the estimated

amounts with the actual targets achieved.

Q.I.S FORM III: It involves the comparison between the actual &

the estimated figures as well as bird’s eye view about the

level of rise/fall in the various items covered in Q.I.S FORM I

& II.

This form is prepared half yearly and

secondly the rise/fall in various items is also compared with the

previous year’s figures of QIS form III

In QIS – I, Current Ratio is computed by dividing current assets

by current liabilities.

Q.I.S FORM I Q.I.S FORM II Q.I.S FORM III

i.e.

Current ratio = current

assets / current liabilities

The current ratio is a financial ratio that measures whether or

not a firm has enough resources to pay its debts over the next 12

months. It compares a firm's current assets to its current

liabilities. The current ratio is an indication of a firm's

market liquidity and ability to meet short-term debt obligations.

Acceptable current ratios vary from industry to industry. In

Living Media India Limited, minimum current ratio is 1.33, means

current assets should at least be 1.33 times the current

liabilities, for the smooth functioning of the business.

If company's current

assets are in this range, then it is generally considered to have

good short-term financial strength. If current liabilities exceed

current assets (the current ratio is below 1), then the company

may have problems meeting its short-term obligations.

In QIS-III, all the figures in the half yearly operating and

funds flow statement are obtained from the profit and loss

account for the related period.

Terminology used in profit and loss account

Advertising – In-house: When advertisements are given for the

publicity of India Today Group magazines in their own magazines.

Example: in the magazine India Today, advertisement is given for

Business Today magazine.

Advertisement-Barter: Barter is something in exchange like when

advertisements regarding magazines (other than India Today Group)

are given in India Today Group magazines then in turn

advertisements for India Today group magazines are published in

other magazines.

All the figures in the monthly accounts are obtained from the

balance sheet of the related period.

Total funds available (sources) are generated by recording the

adjustments in assets and liabilities. i.e.

Non

currentliabilit

ies

Non

currentassets

Currentliabilit

ies

Currentassets

Total funds used (uses) are generated by recording the

adjustments in assets and liabilities. i.e.

PREPARATION OF MSODPREPARATION OF MSOD

(a). What is MSOD (Monthly Select Operational Data)

All the firms on monthly basis prepare monthly select

operational data. Main purpose of preparing MSOD is to show

company’s performance and progress to the banks. It is basically

Currentassets

Currentliabilit

ies

Noncurrentassets

Non Currentliabilit

ies

a monitoring tool for the bank for analyzing the performance of

the firms and the utilization of the bank borrowings.

(*Performa of MSOD & computation of drawing power is shown further)

( b). items involved in the performa of msod

estimated for the current accounting year indicated in the

annual plan:

(i) & (ii) these are yearly figures and will be obtained from the

budget of the current year.

(iii) No amount will be there in production – being a multi

product company, it is not possible to give these figures in case

of India Today. But in case of manufacturing industries, these

figures are relevant.

Gross sale & Advertising Income& other income

Net sale and advertising incomeand other income

Production

Sales/Income

this figure will be obtained this figure is

the cumulative

from consolidated profit & figure of

sales/income

loss statement. up to the

last month in that

accounting year.

Production*

During the monthDuring the current accounting year up to the end of previous month

During the monthDuring the current accounting year up to the end of previous month

* Being a multi product company, it is not possible to give these

figures.

Receivables

(a) Amount will be that figure of which bills have been

discounted or purchased during the month.

(b) This amount will consist of total of advertising & sales

debtors’ up to 120 days. It can be obtained from the statement of

drawing power.

Creditors

(a) Dues in respect of which bills have been

(b)

Otheroutstan

Total (a+b)

Sundry creditors for printing charges

Sundry creditors of paper

Raw material (paper)Short term borrowings from banks including bills purchased

The figures are drawn Unpaid stock from statement

from the monthly of drawing power.

accounts.

(i.e. balance sheet)

Borrowings

all the related amounts all the

related amounts

are obtained from are

obtained

trial balance.

from various

stock reports

Terms used in the statement of stockTerms used in the statement of stock

and debtorsand debtors

Fund Based Working Capital Facilities- up to these limits

overdraft can be obtained from banks as per the agreement.

Overdraft exceeding the

cash credit limit of any bank will bear a penal rate of interest.

(A) Paper at Faridabad : This amount will be obtained from

the Stock Statement of Paper as on……. at Faridabad.

Closing balance= Opening balance +

Purchase- Issue

(B) Paper at Madras : This amount is obtained from the

Statement showing Stock position of Paper lying at M.M Nagar

on…….

Closing balance= Opening balance + Receipt-

Issue

(C) Paper at Mumbai: This amount is obtained from the Statement

of showing Stock position of Paper at Navi Mumbai.

Closing balance= Opening balance +

Receipt-Issue

(D) Paper In Process: This amount is obtained from the

Statement of Paper in process relating to Living Media

India Limited on………………………

BOOK DEBTS

Banks don’t consider book debts exceeding 120 days. These

might be bad debts.

(D1) Advertisements Debtors: This amount is obtained from the

Statement of Outstanding (India Today) as on……

Opening + Billing – Receipts = Net

amount

Billing: amount which we receive when advertisements are

given in India Today Group magazines. Example - if Cadbury

gives its advertisement in India Today magazine, then it is

supposed to pay some amount to India Today group. So,

accordingly billing is made for that amount.

Receipts: Amount received against this billing. Debtors

exceeding 120 days are not taken into consideration. So,

bifurcation is made accordingly.

(D2) Advertisement Debtors: This amount is obtained from

the

Statement of Outstanding ( Reader Digest) as on …..

(E1) Sales Debtors: This amount is obtained from the

Statement of Monthly Outstanding as on………………….

(E2) Sales Debtors: This amount is the figure of Outstanding

Debtors

(Music Today)

Opening balance + Billing amount+ Debit note-

Receipts= Net amount

(E3) Sales Debtors: This amount is obtained from the

Statement of Monthly Outstanding as on…….

(for Reader Digest)

(E4) Sales Debtors: This amount is obtained from the

Statement of Outstanding Debtors (Import) as

on……………

CASH FLOW STATEMENT(CFS)CASH FLOW STATEMENT(CFS)A Cash Flow Statement is a statement showing inflows (receipts)

and outflows (payments) of cash during a particular period. In

other words, it is a summary of sources and applications of cash

during a particular span of time. CFS explains the causes of

changes in the cash balances of the firm by showing the sources

of cash receipts and the purposes for which payments are made.

CFS can be for the past or can be projected for a future period.

Objectives of Cash Flow Statement:

Useful for Short Term Financial Planning : CFS provides

information for planning the short term financial needs of

the firm. Since, it provides information regarding the

sources and utilization of cash during a period, it becomes

easier for the management to assess whether it will have

adequate cash to meet day-to-day expenses and pay the

creditors in time, whether it will have sufficient cash to

pay the long term loans and interest thereon and whether it

has enough cash to pay for the purchase of fixed assets or

not.

Useful in preparing the cash budget : CFS prepared for the

future period is helpful in preparing a cash budget. It

informs the management about the surplus or deficit periods

of cash, i.e., in which months the receipts of cash will be

in excess of payments and in which months the payments will

be in excess of receipts. It helps in planning the

investment of surplus cash in short term investments and to

plan short term credit in advance for deficit periods.

Study of the trend of cash receipts and payments : CFS

reveals the speed at which the cash is being generated from

debtors, stock and other current assets and the speed at

which the current liabilities are being paid. it enables the

management to assess the true position of the cash in

future.

It explains the deviations of cash from earnings : a firm

may earn huge profits yet it may have paucity of cash or

when it suffered a loss it may still have plenty of cash. A

cash flow statement explains the reasons for it.

Helpful in making dividend decision : dividend must be paid

within 42 days of its declaration. Hence, the management

takes the help of cash flow statement to ascertain the

position of cash generated from operating activities which

can be used for payment of dividend.

Accounts

Posting of advertisements and posting of

advertisement and

Subscription cheques

sales cheques

OSC (advertisements, subscription and sales cheques). When amount

is realized from the Cheques of subscription, limit is given to

the outstation banks that they can keep with them a particular

CURRENTACCOUNT

CC ACCOUNT

amount and the rest amount is transferred to Head Office branch –

Delhi (funds are monitored here) through TT (Telegraphic

Transfer).

So, Daily Bank Position is made

for

Daily Bank Position is prepared as per bank’s requirement so as

to assess company’s performance. Under this statement, balance as

per cash book and as per bank is noted down, so as to ascertain

the differences, if any.

If differences are there, then bank

reconciliation statement is prepared to reconcile the balances

of both the books. Differences are mainly due to cheques issued

but not yet presented for the payment and cheques deposited into

the bank and not yet collected.

Daily bank position is made on the basis of working capital

facilities.

Working Capital Facilities can be availed in the following ways:

BUDGETINGPURPOSE

PLANNING OUTFLOWS DIVERSION

Cash Credit

Short-term Rupee Loan

Cash credit limit- the fixed limit (given by banks under some

agreed terms and conditions) up to which a company can withdraw.

If withdrawal is beyond that limit, then it bears a penal rate of

interest.

Short term Rupee Loan (STRL) - it is a part of cash credit limit

and for a short period which can extend from 7 days to maximum 1

year. If a company wants to repay the loan amount, before the

expiry of its maturity date, then the organization has to pay

penalty (as per agreed terms and conditions) for the remaining

period.

Roll Over is a term used to extend the loan period.

Rate of interest (ROI) charged on STRL is decided by the

agreement between RBI and commercial bank. Margin is added to

this interest rate and ROI to be charged on STRL is formed. This

ROI is called call money rate.

STRL can only be availed by those companies that are

rated higher as per the bank norms. Fortunately, the India Today

group is one of those that can avail these facilities. ROI on

these loans are normally lower than ROI on CC limits because it

is for a short period. ROI varies from bank to bank.

BANK GUARANTEEBANK GUARANTEE

When a firm enters into a business with other firm and it has to

pay some amount to this firm under agreed terms of business

dealings, then latter firm wants some guarantor on behalf of the

former firm as, if this firm fails to pay the desired amount,

then the guarantor pays the same on behalf to the beneficiary.

A limit is there on the time period involved as

well as on the amount guaranteed. Bank charges commission on the

guaranteed amount.

The client firm gives some terms and

conditions to the main party for issuance of bank guarantee. If

the main party and the issuing bank agree on the terms and

conditions of the agreement, then finally guarantee is issued by

the bank.

As India Today group is a publisher and send

magazines to its customers/suppliers through post office with the

availed facility for dispatch of magazines as prepayment of

postage. Now in this case, post office wants some guarantor

(bank) to assure that in case, Living Media India Limited fails

to pay the required amount demanded by Post Master General, bank

shall pay the guaranteed sum to Post Master General on behalf of

Living Media India Limited.

Some of the statements used in the bank guarantee documents are:

Guarantee is subject to condition that the liability of bank

under this guarantee is limited to a maximum amount

of……………..during the decided period.

FinancialPerformance

It is not used in Living Media

It is used in Living Media

Cheques exceeding the total amount of the guarantee are not

accepted at any one time.

The bank would only be liable to pay uncashed cheques up to

the total amount of the guarantee.Renew/extend the period of bank guarantee as per the requirement.

Civil suit and writ petition: when legal involvement is

there.

guarantee type Guarantee types

Living Media sends packets to post office for dispatching it to subscribers. So, Living Media is performing

Direct finance is involved here

Commission charged by banks varies from bank to bank. Commission

involved in financial guarantee is more than commission involved

in performance guarantee.

SUBSCRIPTIONSUBSCRIPTIONIt is a payment given for regularly scheduled publications.

People who want to go for regular subscription for magazines,

issue cheques/demand drafts in the favour of “Living Media India

Limited” and hence accordingly their account is debited and

living media’s account is credited.

People prefer to give cheques to demand drafts so as to avoid

inconvenience one faces during the preparation of demand drafts

and also if one is not having immediate amount in one’s account,

cheque can be issued and amount is deposited at a later date.

Process

Subscriber sends cheques/DDs in the marketing department of Noida

office, and then these cheques are sent to the subscription

department. Here, all the cheques are segregated and then cheques

are sent to finance department, Living Media India Limited,

Faridabad, and finally these are deposited in the various banks

at various places for getting credit. Ultimately, bank

reconciliation statement is prepared at the finance department to

sort out the differences between the balances as per our books

and bank statements.

Process followed at living media (for local cheques)

First of all, cheques received from noida office are checked

and counted.

Then entries are posted in the system.

A receiving and a depositing register is prepared.

Monthly statements are recorded here.

Statement number, date, number of cheques, amount, and

pay in slip number are the details to be

filled. Pay in slip

number is allotted in a serial order so

as to implement

effective control.

Then cheques/DDs are deposited in the various banks. Pay in

slips are filled and counter foil is kept for future

reference.

Data punching is done at the finance department to keep

records.

Outstation cheques (OSCs)Outstation cheques along with a list stating the various brief

details like the drawee bank, cheque number and amount etc. Is

received at Living Media India Limited (LMI), Faridabad from

subscription department, noida.

Then the concerned person at LMI, Faridabad makes

the segregation of cheques (station wise) and ultimately a final

list is prepared to deposit the cheques into the bank.

Bank referred here is HDFC bank. LMI has an

agreement with HDFC bank under which this bank provides credit to

LMI on the 8th day of depositing cheques. HDFC bank arranges to

send these OSCs for collection to the respective banks and gets

time to time credit according to the policies of various banks.

20 to 30 days is the approximated period when HDFC bank gets

credit from other banks against which it has already given credit

to LMI.

INTER DEPARTMENT LINKAGE

n

SEND

CHEQUES

INFORM TO TO

INFORM

TO

SEND

SUBSCRIBER

MARKETING DEPARTMENT

CHEQUES TO

TO

DEPOSIT FOR

AT BANK

DATA

& TO

PUNCHING

SEND

& TO

STATUS

KEEP

TO T

RECORDS

SUBSCRIPTION

Accounting system

1. Segregation is done and magazine wise statements are made.

2. Summary of annexure is prepared and total of each magazine

is calculated

FINANCE

DEPARTMENT

SUBSCRIPTIONDEPARTMENT

DEPARTMENT

3. Depositing the cheques with statements and soft copies at

bank.

4. Then, voucher punching is done in the system for keeping

records.

5. To post entries in the books of living media, following

vouchers are made

6. When deposits are made in the banks, bank receipt/collection

vouchers are prepared.

7. When payment is made through cheques, to accounts payable,

sundry creditors and other parties, bank payment vouchers

are prepared.

8. Journal voucher is made regarding journal entries and

provision entries.

9. Bank reconciliation is made for the confirmation of

matching the balances as per our books and bank statement.

Collection voucher

Payment voucher

Journal voucher

Purchase Voucher

BANK RECONCILIATION STATEMENT (BRS)BANK RECONCILIATION STATEMENT (BRS)

Bank reconciliation statement is a statement which reconciles the

balance as per a firm’s books accounts and the balance as per

bank statement showing all the causes of differences between the

two.

Bank reconciliation verifies

all the transactions of cash disbursement records with the

accounting records of the bank. This activity consists of an

accountant comparing the bank's reported account balance with the

accounting department's bank account records and identifying

adjustments required to make the balances between the two systems

agree. Causes of differences:

Cheques issued but not yet presented for payment : Whenever,

payment has made through a cheque, the entry is made in our

books immediately. But the entry will be made by the bank

only when the cheque is presented for the payment. Till

that, the said entry will come under cheques issued but not

yet presented for payment.

Cheques deposited in to the bank but not yet cleared : As

soon as the cheques are sent to the bank for deposit,

entries are made in the books of the firm. But usually,

banks credit the account only when they have received the

payment from the concerned bank. In other words, when the

cheques have been cleared. Again there will be some gap

between depositing the cheques and the credit given by the

bank.

Unlinked debits : sometimes there are some charges or some

payments which are debited by the bank to our account

without any advices, but no entry is made in the books of

firm. So, these need to be adjusted in our books.

Unlinked credits : sometimes there are some receipts and

miscellaneous incomes which directly come from parties

through telegraphic transfer or net banking facility, then

these are credited by bank to our account and no entry is

made to show its effect in the books of the firm’s account.

So they need to be adjusted in our books.

Need and importance

The bank reconciliation will bring out any errors that may

have been committed either in the bank statement or in the

books of firm.

Any undue delay in the clearance of cheques will be shown up

by the reconciliation.

Reconciliation helps the management check the accuracy of

entries made in the books of firm and keeps track of cheques

etc.which may have been sent to the bank for collection.

One other benefit is that bank reconciliation catches errors

that the bank made in processing deposits and payments.

Procedure of preparing BRSProcedure of preparing BRS

Step 1 : for the purpose of preparing bank reconciliation

statement two major statements are required-

a.) Statement prepared by bank depending upon the transactions

debited/credited on daily basis.

b.) Statement prepared by the company’s accounts department

depending upon the transactions done on daily basis.

Step 2: then next step is to match the entries between both the

statements.

Performa of Bank Statement- provided by the

bank

Company’s Books

Date Voucher

no.

Particular

s

Cheque

no.

Debit Credit Balance

Date Particulars Cheque no. Withdrawals Deposits

balances

Now the cheque no. Present in both the statements are matched

with each other.

Step 3: - Now the entries, which are present in both the

statements and gets matched are considered verified.

But those, which do not get matched with

each other i.e., which are present in bank’s statement but are

not there in company’s statement or vice-versa are treated

accordingly.

Those debit entries that are present in bank

statement but are not in company’s statement i.e. The amount of

withdrawals will be treated as unlinked debits and the amount of

deposits will be treated as unlinked credits.

Those entries which are present in

company’s statement but are not present in bank statement i.e.

The amount of debit side in company’s statement will be treated

as “amount deposited but not yet collected” and the amount on the

credit side will be treated as “cheque issued but not presented

for payment”.

Step 4: -then finally bank reconciliation statement will be

prepared whose performa is as under:

Particulars

Amount(Rs.)

Balance as per our books Dr.

Add:

Cheques issued but not presented for payment

Unlinked credits

Less:

Cheques deposited but not yet collected

Unlinked debits

Balance as per our calculations Cr.

Balance as per bank statement

Cr.

The amounts obtained under different heads in step-3 will be put

under their respective heads in step-4 and accordingly total

amount of difference between the two statements will be

ascertained.

The total amount obtained

under the head total should be the same as balance shown by the

bank statement.

Reverse will be the case if

balance as per our books is in terms of credit.

CASH MANAGEMENT SYSTEM(CMS)CASH MANAGEMENT SYSTEM(CMS)

A cash management system is an it solution which allows us to

automate and control all activities related to processing

financial takings. Very simply, takings are counted automatically

and totals fed directly into the system for totaling,

reconciliation and reporting.

This type of system is used in the organization where

a large number of a particular type of activities

(cheques here) takes place on a daily basis.

It is a tool for collecting money.

Collection needs to be done as

collection

Advertisements:

Amount collected from various brands, which want to give their

ads in any of the India Today Group magazines.

Sales collection:

COLLECTION

ADVERTISEMENTS

SALES COLLECTION

SUBSCRIPTION

Local Cheques

It includes revenue collected from the sales at news stands (bus

stops, railway stations, book stores etc.)

Subscription:

It includes amount generated when people go for subscription. It

can be on yearly or so basis.

Cheques received for subscription are categorized into

Local clearing:

Cheques for the areas where there are offices of a

company and deposited in the same city, are treated as

local cheques.

No bank charges are applicable here.

Cheques collected are to be deposited in the bank by

filling the deposit slips and account is credited

almost next day.

Cheques

Upcountry Cheques

InsidenetworkCheques

RBI (main bank of our country) also provides the

facility of “high value clearing” in selected cities

to get credit on the same day.

Cheques purchase system

Some private banks charge per instrument, terms and

conditions are there and hence early credit is

obtained.

It is applicable to other than local clearing.

Inside network:

When different banks have their respective branches at

various places.

Charges are applicable here. ( by the mutual agreement

between the company and the bank)

Charges are less here because online functioning is

there and there is least possibility of loosing the

cheques.

Credit proceeds are applicable by the mutual agreement

between the company and the bank.

Upcountry cheques:

Cheques of the banks in remote areas, villages etc are

included here.

Charges are applicable here (charges here are more

than charges in inside network)

Credit proceeds are applicable by the mutual agreement

between the company and the bank.

100% realization is not there because many times

cheques are lost in the transit.

RTGS (real time gross settlement)

This system is used for making inter bank transfers.

Services offered by various banks

Several banks offer proposals to India Today Group for meeting

the requirements of:

Faster collection of subscription cheques received

from clients

Having better cash management solutions

Speedy collections, payments, better liquidity

management and channel space

Ability to support anywhere collections and anywhere

payments

These banks briefly describe their historical presence, extensive

branch network, wide product range and dedicated relationship and

cash management teams, their focus and investment in cash

management, robust infrastructure, knowledge and experience of

domestic market.

Benefits of CMS on Living Media India Limited:

By simplifying and automating cash processing operations, cash

management systems improve speed and reduce costs. Savings can be

enormous as coin and note counters can count at a fraction of the

time it takes a human. Also, counting errors are 5 times less

likely than with human counting – removing the need for double

counting and recounting. Automatic input of data to the cash

office pc also avoids the errors associated with paper based

systems and the manual input of data, as well as saving time. CMS

improves security and control over the cash management process.

It also help to reduce shrinkage from staff theft, mistakes at

the till or cash office and counterfeit currency.

Limitations of the studyLimitations of the study

Due to short duration of training period many aspects

of the finance department was left uncovered.

As the company is a closely held company so many of the

facts, actual figures & information cannot be provided.

FUTURE PLANSFUTURE PLANSThomson press enjoys the largest market share in

commercial printing at the moment, approximately 20%. Plans have

been implemented to increase this to 30% in the next financial

year.

In pre- press business, 5% market share is being

achieved this year, with a plan to increase the rates in early

1994 by 42.5% but the current trend indicates that further

revision will not be possible this financial year due to

competitive pressure.

Thomson press is also exploring the possibility of

further export of quality colour printing and also pre-press

assignments.

As already mentioned earlier, thomson press is one of

the modern printing press in india. Due to globalization and

new economic policy the company has to survive in this

industry to face the competition.

RECOMMENDATIONS

It should be ensured that the actual expenditure incurred

under various heads of expenditure is within approved

budgetary amount.

Focused attention should be paid by initiating a special

drive to expediate recoveries from sundry debtors.

As the main objective is to maximize revenue and minimize

cost and for this purpose the Living Media India Limited

must ensure timely collection as per contracted

arrangements.

Staff should be provided with the appropriate training so

that the maximum output can be achieved with minimum of

time.

BIBLIOGRAPHYBIBLIOGRAPHY

www.thomsonpress.com

www.india-today.com

Analysis of Financial Statements-D.K Goel

Fundamentals of Accounting-T.S. Grewal