COMPARATIVE INVESTMENT ANALYSIS OF MUTUAL FUNDS & ULIPS Dr.I.Satyanarayana 1, N.B.C.Sidhu* 2, P. Linga Swamy 3. Telangana, India.

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1 ISSN: IJMRR/June 2015/ Volume 5/Issue 6/Article No-1/ N.B.C. Sidhu et. al. / International Journal of Management Research & Review COMPARATIVE INVESTMENT ANALYSIS OF MUTUAL FUNDS & ULIPS Dr.I.Satyanarayana 1, N.B.C.Sidhu* 2, P. Linga Swamy 3 1 Principal, Sri Indu institute of Engineering & Technology, Sheriguda, Ibrahimpatnam, Telangana, India. 2 Assoc. Prof & HOD, Dept. of Master of Business Administration, Sri Indu Institute of Engineering & Technology, Sheriguda, Ibrahimpatnam, Telangana, India. 3 Student, Dept. of Master of Business Administration, Sri Indu Institute of Engineering & Technology, Sheriguda, Ibrahimpatnam, Telangana, India. ABSTRACT Complementing the balance sheet and income statement, the cash flow statement (CFS), a mandatory part of a company's financial reports since 1987, records the amounts of cash and cash equivalents entering and leaving a company. The CFS allows investors to understand how a company's operations are running, where its money is coming from, and how it is being spent. Here you will learn how the CFS is structured and how to use it as part of your analysis of a company. THE STRUCTURE OF THE CFS The cash flow statement is distinct from the income statement and balance sheet because it does not include the amount of future incoming and outgoing cash that has been recorded on credit. Therefore, cash is not the same as net income, which, on the income statement and balance sheet, includes cash sales and sales made on credit. (To learn more about the credit crisis, read Cash flow is determined by looking at three components by which cash enters and leaves a company: core operations, investing and financing). OPERATIONS Measuring the cash inflows and outflows caused by core business operations, the operations component of cash flow reflects how much cash is generated from a company's products or services. Generally, changes made in cash, accounts receivable, depreciation, inventory and accounts payable are reflected in cash from operations. Cash flow is calculated by making certain adjustments to net income by adding or subtracting differences in revenue, expenses and credit transactions (appearing on the balance sheet and income statement) resulting from transactions that occur from one period to the next. These adjustments are made because noncash items are calculated into net income (income statement) and total assets and liabilities (balance sheet). So, because not all transactions involve actual cash items, many items have to be re-evaluated when calculating cash flow from operations. Changes in accounts receivable on the balance sheet from one accounting period to the next must also be reflected in cash flow. If accounts receivable decreases, this implies that more cash has entered the *Corresponding Author 328

2 company from customers paying off their credit accounts - the amount by which AR has decreased is then added to net sales. If accounts receivable increase from one accounting period to the next, the amount of the increase must be deducted from net sales because, although the amounts represented in AR are revenue, they are not cash. An increase in inventory, on the other hand, signals that a company has spent more money to purchase more raw materials. If the inventory was paid with cash, the increase in the value of inventory is deducted from net sales. A decrease in inventory would be added to net sales. If inventory was purchased on credit, an increase in accounts payable would occur on the balance sheet, and the amount of the increase from one year to the other would be added to net sales INTRODUCTION In financial accounting, a cash flow statement, also known as statement of cash flows or funds flow statement, is a financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, and breaks the analysis down to operating, investing, and financing activities. Essentially, the cash flow statement is concerned with the flow of cash in and cash out of the business. The statement captures both the current operating results and the accompanying changes in the balance sheet As an analytical tool, the statement of cash flows is useful in determining the short-term viability of a company, particularly its ability to pay bills. International Accounting Standard 7 (IAS 7) is the International Accounting Standard that deals with cash flow statements. People and groups interested in cash flow statements include: Accounting personnel, who need to know whether the organization will be able to cover payroll and other immediate expenses Potential lenders or creditors, who want a clear picture of a company's ability to repay Potential investors, who need to judge whether the company is financially sound Potential employees or contractors, who need to know whether the company will be able to afford compensation Shareholders of the business. Purpose The cash flow statement was previously known as the flow of funds statement. The cash flow statement reflects a firm's liquidity. The balance sheet is a snapshot of a firm's financial resources and obligations at a single point in time, and the income statement summarizes a firm's financial transactions over an interval of time. These two financial statements reflect the accrual basis accounting used by firms to match revenues with the expenses associated with generating those revenues. The cash flow statement includes only inflows and outflows of cash and cash equivalents; it excludes transactions that do not directly affect cash receipts and payments. These noncash transactions include depreciation or write-offs on bad debts or credit losses to name a few. The cash flow statement is a cash basis report on three types of financial activities: operating Copyright 2012 Published by IJMRR. All rights reserved 329

3 activities, investing activities, and financing activities. Noncash activities are usually reported in footnotes. The cash flow statement is intended to provide information on a firm's liquidity and solvency and its ability to change cash flows in future circumstances provide additional information for evaluating changes in assets, liabilities and equity improve the comparability of different firms' operating performance by eliminating the effects of different accounting methods indicate the amount, timing and probability of future cash flows The cash flow statement has been adopted as a standard financial statement because it eliminates allocations, which might be derived from different accounting methods, such as various timeframes for depreciating fixed assets. NEED AND IMPORTENCE OF STUDY Many business owners disregard the importance of cash flow statements because they unwittingly believe that their current financial standing can be construed from other financial reports and projections. Unfortunately, however, a cash flow statement is necessary to adequately assess the incoming and outgoing flow of cash and other resources in a business. Not only will a business owner with a cash flow system be more aware of his or her financial standing, but it will also help investors to make educated decisions on future investments. A business with regular and reliable cash flow statements shows more economic solvency, and is more attractive to investors. A cash flow statement documents the incoming and outgoing cash in plain terms. Future sales and sales made for credit (unless they have been paid off) are not included in the cash flow statement, and most of the data will come from core operations. Payables and receivables should be expressly defined, as should depreciation of product value and inventory that has not yet been moved. This will allow a business owner to compare past periods with the current financial standing and determine whether your receivables have increased or decreased. This can also help to track your investments next to your receivables and payables. Are your investments increasing or decreasing in value? And has your inventory moved at a steady pace? New or expanding businesses can expect to see a decrease in cash flow, but this doesn t mean that the business is goingunder. There are typically five different sections in a cash flow statement, though large businesses might have more complex cash flow systems as required. SCOPE OF THE STUDY Since it will not be possible to conduct a micro level study of all Cement industries in Andhra Pradesh, the study is restricted to Kotak Mahindra Group. (Formerly Kotak Mahindra bank Ltd.) only. A study that involves an examination of long term as well as short term sources that a company taps in order to meet its requirements of finance. The scope of the study is confined to the sources that Kotak Mahindra Group tapped over the years under study i.e Copyright 2012 Published by IJMRR. All rights reserved 330

4 OBJECTIVES To know the flow of cash in the organization Kotak Mahindra Group. (Formerly Kotak Mahindra bank Ltd.). To access the efficiency with sources and uses of cash were made by the co ordinance the present year to To identify the changes in the elements of focus and uses of working capital in between above mentioned years. To improve the financial performance of the company. METHODOLOGY OF STUDY The following are the main sources of date used for this study which are collected and compiled from published and unpublished sources of the Company data. The published sources are as follows: Management information system published by Kotak Mahindra Group. (Formerly Kotak Mahindra bank Ltd.). Status Report on Kotak Mahindra Group. (Formerly Kotak Mahindra bank Ltd.).. Journals, books and other published reports. The present study is mainly based on primary and secondary sources of Data collection. The primary data was directly collected by observations, Interviews questionnaire etc. The secondary data was collected from the literate available in libraries and research studies and annual reports are related to the present study. It includes published and unpublished literature like books, reports and generally Articles of the Kotak Mahindra Group. (Formerly Kotak Mahindra bank Ltd.). LIMITATIONS OF THE STUDY The limitations of present study are as follows: The study cover a period of FIVE years from The study does not flow the fund. The study is based mainly on secondary information. The study does not touch all the units of Kotak Mahindra Group. (Formerly Kotak Mahindra bank Ltd.).. The present study cannot be used for inter firm comparison. Limited span of time is a major limitation for this project. The act and figures of the study is limited to the period of FIVE years i.e The data used in reports are taken from the annual reports, published at the end of the years. The result does not reflect the day-to-day transactions. It is also impossible to the study of day-to-day transactions in cash management. The analysis of the working capital is taken FIVE years. Copyright 2012 Published by IJMRR. All rights reserved 331

5 INDUSTRY PROFILE A bank is a financial institution that accepts deposits and channels those deposits into lending activities. Banks primarily provide financial services to customers while enriching investors. Government restrictions on financial activities by banks vary over time and location. Banks are important players in financial markets and offer services such as investment funds and loans. In some countries such as Germany, banks have historically owned major stakes in industrial corporations while in other countries such as the United States banks are prohibited from owning non-financial companies. In Japan, banks are usually the nexus of a cross-share holding entity known as the keiretsu. In France, bancassurance is prevalent, as most banks offer insurance services (and now real estate services) to their clients. Introduction India s banking sector is constantly growing. Since the turn of the century, there has been a noticeable upsurge in transactions through ATMs, and also internet and mobile banking. Following the passing of the Banking Laws (Amendment) Bill by the Indian Parliament in 2012, the landscape of the banking industry began to change. The bill allows the Reserve Bank of India (RBI) to make final guidelines on issuing new licenses, which could lead to a bigger number of banks in the country. Some banks have already received licences from the government, and the RBI's new norms will provide incentives to banks to spot bad loans and take requisite action to keep rogue borrowers in check. Over the next decade, the banking sector is projected to create up to two million new jobs, driven by the efforts of the RBI and the Government of India to integrate financial services into rural areas. Also, the traditional way of operations will slowly give way to modern technology. Market size Total banking assets in India touched US$ 1.8 trillion in FY13 and are anticipated to cross US$ 28.5 trillion in FY25.Bank deposits have grown at a compound annual growth rate (CAGR) of 21.2 per cent over FY Total deposits in FY13 were US$ 1,274.3 billion.total banking sector credit is anticipated to grow at a CAGR of 18.1 per cent (in terms of INR) to reach US$ 2.4 trillion by In FY14, private sector lenders witnessed discernable growth in credit cards and personal loan businesses. ICICI Bank witnessed per cent growth in personal loan disbursement in FY14, as per a report by Emkay Global Financial Services. Axis Bank's personal loan business also rose 49.8 per cent and its credit card business expanded by 31.1 per cent. Investments Bengaluru-based software services exporter Mphasis Ltd has bagged a five-year contract from Punjab National Bank (PNB) to set up the bank s contact centres in Mangalore and Noida (UP). Mphasis will provide support for all banking products and services, including Copyright 2012 Published by IJMRR. All rights reserved 332

6 deposits operations, lending services, banking processes, internet banking, and account and card-related services. The company will also offer services in multiple languages. Microfinance companies have committed to setting up at least 30 million bank accounts within a year through tie-ups with banks, as part of the Indian government s financial inclusion plan. The commitment was made at a meeting of representatives of 25 large microfinance companies and banks and government representatives, which included financial services secretary Mr GS Sandhu. Export-Import Bank of India (Exim Bank) will increase its focus on supporting project exports from India to South Asia, Africa and Latin America, as per Mr Yaduvendra Mathur, Chairman and MD, Exim Bank. The bank has moved up the value chain by supporting project exports so that India earns foreign exchange. In , Exim Bank lent support to 85 project export contracts worth Rs 24,255 crore (US$ 3.96 billion) secured by 47 companies in 23 countries. Government Initiatives The RBI has given banks greater flexibility to refinance current long-gestation project loans worth Rs 1,000 crore (US$ million) and more, and has allowed partial buyout of such loans by other financial institutions as standard practice. The earlier stipulation was that buyers should purchase at least 50 per cent of the loan from the existing banks. Now, they get as low as 25 per cent of the loan value and the loan will still be treated as standard. The RBI has also relaxed norms for mortgage guarantee companies (MGC) enabling these firms to use contingency reserves to cover for the losses suffered by the mortgage guarantee holders, without the approval of the apex bank. However, such a measure can only be initiated if there is no single option left to recoup the losses. SBI is planning to launch a contact-less or tap-and-go card facility to make payments in India. Contact-less payment is a technology that has been adopted in several countries, including Australia, Canada and the UK, where customers can simply tap or wave their card over a reader at a point-of-sale terminal, which reads the card and allows transactions. SBI and its five associate banks also plan to empower account holders at the bottom of the social pyramid with a customer call facility. The proposed facility will help customers get an update on available balance, last five transactions and cheque book request on their mobile phones. Road Ahead India is yet to tap into the potential of mobile banking and digital financial services. Fortyseven per cent of the populace have bank accounts, of which half lie dormant due to reliance on cash transactions, as per a report. Still, the industry holds a lot of promise. India's banking sector could become the fifth largest banking sector in the world by 2020 and the third largest by These days, Indian banks are turning their focus to servicing clients and enhancing their technology infrastructure, which can help improve customer experience as well as give banks a competitive edge. Copyright 2012 Published by IJMRR. All rights reserved 333

7 Exchange Rate Used: INR 1 = US$ as on October 28, 2014 The level of government regulation of the banking industry varies widely, with countries such as Iceland, having relatively light regulation of the banking sector, and countries such as China having a wide variety of regulations but no systematic process that can be followed typical of a communist system. The oldest bank still in existence is Monte dei Paschi di Siena, headquartered in Siena, Italy, which has been operating continuously since History Origin of the word The name bank derives from the Italian word banco "desk/bench", used during the Renaissance by Jewish Florentine bankers, who used to make their transactions above a desk covered by a green tablecloth. However, there are traces of banking activity even in ancient times, which indicates that the word 'bank' might not necessarily come from the word 'banco'. In fact, the word traces its origins back to the Ancient Roman Empire, where moneylenders would set up their stalls in the middle of enclosed courtyards called macella on a long bench called a bancu, from which the words banco and bank are derived. As a moneychanger, the merchant at the bancu did not so much invest money as merely convert the foreign currency into the only legal tender in Rome that of the Imperial Mint. The earliest evidence of money-changing activity is depicted on a silver drachm coin from ancient Hellenic colony Trapezus on the Black Sea, modern Trabzon, c BC, presented in the British Museum in London. The coin shows a banker's table (trapeza) laden with coins, a pun on the name of the city. In fact, even today in Modern Greek the word Trapeza (Τράπεζα) means both a table and a bank. Traditional banking activities Banks act as payment agents by conducting checking or current accounts for customers, paying cheques drawn by customers on the bank, and collecting cheques deposited to customers' current accounts. Banks also enable customer payments via other payment methods such as telegraphic transfer, EFTPOS, and ATM. Banks borrow money by accepting funds deposited on current accounts, by accepting term deposits, and by issuing debt securities such as banknotes and bonds. Banks lend money by making advances to customers on current accounts, by making installment loans, and by investing in marketable debt securities and other forms of money lending. Banks provide almost all payment services, and a bank account is considered indispensable by most businesses, individuals and governments. Non-banks that provide payment services such as remittance companies are not normally considered an adequate substitute for having a bank account. Banks borrow most funds from households and non-financial businesses, and lend most funds to households and non-financial businesses, but non-bank lenders provide a significant and in Copyright 2012 Published by IJMRR. All rights reserved 334

8 many cases adequate substitute for bank loans, and money market funds, cash management trusts and other non-bank financial institutions in many cases provide an adequate substitute to banks for lending savings to. Entry regulation Currently in most jurisdictions commercial banks are regulated by government entities and require a special bank licence to operate. Usually the definition of the business of banking for the purposes of regulation is extended to include acceptance of deposits, even if they are not repayable to the customer's order although money lending, by itself, is generally not included in the definition. Unlike most other regulated industries, the regulator is typically also a participant in the market, i.e. a government-owned (central) bank. Central banks also typically have a monopoly on the business of issuing banknotes. However, in some countries this is not the case. In the UK, for example, the Financial Services Authority licences banks, and some commercial banks (such as the Bank of Scotland) issue their own banknotes in addition to those issued by the Bank of England, the UK government's central bank. Accounting for bank accounts Bank statements are accounting records produced by banks under the various accounting standards of the world. Under GAAP and IFRS there are two kinds of accounts: debit and credit. Credit accounts are Revenue, Equity and Liabilities. Debit Accounts are Assets and Expenses. This means you credit a credit account to increase its balance, and you debit a debit account to decrease its balance. This also means you debit your savings account every time you deposit money into it (and the account is normally in deficit), while you credit your credit card account every time you spend money from it (and the account is normally in credit). However, if you read your bank statement, it will say the opposite that you credit your account when you deposit money, and you debit it when you withdraw funds. If you have cash in your account, you have a positive (or credit) balance; if you are overdrawn, you have a negative (or deficit) balance. The reason for this is that the bank, and not you, has produced the bank statement. Your savings might be your assets, but the bank's liability, so they are credit accounts (which should have a positive balance). Conversely, your loans are your liabilities but the bank's assets, so they are debit accounts (which should also have a positive balance). Where bank transactions, balances, credits and debits are discussed below, they are done so from the viewpoint of the account holder which is traditionally what most people are used to seeing. Economic functions issue of money, in the form of banknotes and current accounts subject to cheque or payment at the customer's order. These claims on banks can act as money because they are negotiable and/or repayable on demand, and hence valued at par. They are effectively Copyright 2012 Published by IJMRR. All rights reserved 335

9 transferable by mere delivery, in the case of banknotes, or by drawing a cheque that the payee may bank or cash. netting and settlement of payments banks act as both collection and paying agents for customers, participating in interbank clearing and settlement systems to collect, present, be presented with, and pay payment instruments. This enables banks to economise on reserves held for settlement of payments, since inward and outward payments offset each other. It also enables the offsetting of payment flows between geographical areas, reducing the cost of settlement between them. credit intermediation banks borrow and lend back-to-back on their own account as middle men. credit quality improvement banks lend money to ordinary commercial and personal borrowers (ordinary credit quality), but are high quality borrowers. The improvement comes from diversification of the bank's assets and capital which provides a buffer to absorb losses without defaulting on its obligations. However, banknotes and deposits are generally unsecured; if the bank gets into difficulty and pledges assets as security, to raise the funding it needs to continue to operate, this puts the note holders and depositors in an economically subordinated position. maturity transformation banks borrow more on demand debt and short term debt, but provide more long term loans. In other words, they borrow short and lend long. With a stronger credit quality than most other borrowers, banks can do this by aggregating issues (e.g. accepting deposits and issuing banknotes) and redemptions (e.g. withdrawals and redemptions of banknotes), maintaining reserves of cash, investing in marketable securities that can be readily converted to cash if needed, and raising replacement funding as needed from various sources (e.g. wholesale cash markets and securities markets). Law of banking Banking law is based on a contractual analysis of the relationship between the bank (defined above) and the customer defined as any entity for which the bank agrees to conduct an account. The law implies rights and obligations into this relationship as follows: The bank account balance is the financial position between the bank and the customer: when the account is in credit, the bank owes the balance to the customer; when the account is overdrawn, the customer owes the balance to the bank. The bank agrees to pay the customer's cheques up to the amount standing to the credit of the customer's account, plus any agreed overdraft limit. The bank may not pay from the customer's account without a mandate from the customer, e.g. a cheque drawn by the customer. The bank agrees to promptly collect the cheques deposited to the customer's account as the customer's agent, and to credit the proceeds to the customer's account. Copyright 2012 Published by IJMRR. All rights reserved 336

10 The bank has a right to combine the customer's accounts, since each account is just an aspect of the same credit relationship. The bank has a lien on cheques deposited to the customer's account, to the extent that the customer is indebted to the bank. The bank must not disclose details of transactions through the customer's account unless the customer consents, there is a public duty to disclose, the bank's interests require it, or the law demands it. The bank must not close a customer's account without reasonable notice, since cheques are outstanding in the ordinary course of business for several days. These implied contractual terms may be modified by express agreement between the customer and the bank. The statutes and regulations in force within a particular jurisdiction may also modify the above terms and/or create new rights, obligations or limitations relevant to the bank-customer relationship. Some types of financial institution, such as building societies and credit unions, may be partly or wholly exempt from bank licence requirements, and therefore regulated under separate rules. The requirements for the issue of a bank licence vary between jurisdictions but typically include: Minimum capital Minimum capital ratio 'Fit and Proper' requirements for the bank's controllers, owners, directors, and/or senior officers Approval of the bank's business plan as being sufficiently prudent and plausible. Types of banks Banks' activities can be divided into retail banking, dealing directly with individuals and small businesses; business banking, providing services to mid-market business; corporate banking, directed at large business entities; private banking, providing wealth management services to high net worth individuals and families; and investment banking, relating to activities on the financial markets. Most banks are profit-making, private enterprises. However, some are owned by government, or are non-profit organizations. Central banks are normally government-owned and charged with quasi-regulatory responsibilities, such as supervising commercial banks, or controlling the cash interest rate. They generally provide liquidity to the banking system and act as the lender of last resort in event of a crisis. Types of retail banks Commercial bank: the term used for a normal bank to distinguish it from an investment bank. After the Great Depression, the U.S. Congress required that banks only engage in banking activities, whereas investment banks were limited to capital market activities. Since Copyright 2012 Published by IJMRR. All rights reserved 337

11 the two no longer have to be under separate ownership, some use the term "commercial bank" to refer to a bank or a division of a bank that mostly deals with deposits and loans from corporations or large businesses. Community Banks: locally operated financial institutions that empower employees to make local decisions to serve their customers and the partners. Community development banks: regulated banks that provide financial services and credit to under-served markets or populations. Postal savings banks: savings banks associated with national postal systems. Private banks: banks that manage the assets of high net worth individuals. Offshore banks: banks located in jurisdictions with low taxation and regulation. Many offshore banks are essentially private banks. Savings bank: in Europe, savings banks take their roots in the 19th or sometimes even 18th century. Their original objective was to provide easily accessible savings products to all strata of the population. In some countries, savings banks were created on public initiative; in others, socially committed individuals created foundations to put in place the necessary infrastructure. Nowadays, European savings banks have kept their focus on retail banking: payments, savings products, credits and insurances for individuals or small and medium-sized enterprises. Apart from this retail focus, they also differ from commercial banks by their broadly decentralised distribution network, providing local and regional outreach and by their socially responsible approach to business and society. Building societies and Landesbanks: institutions that conduct retail banking. Ethical banks: banks that prioritize the transparency of all operations and make only what they consider to be socially-responsible investments. Islamic banks: Banks that transact according to Islamic principles. Types of investment banks Investment banks "underwrite" (guarantee the sale of) stock and bond issues, trade for their own accounts, make markets, and advise corporations on capital market activities such as mergers and acquisitions. Merchant banks were traditionally banks which engaged in trade finance. The modern definition, however, refers to banks which provide capital to firms in the form of shares rather than loans. Unlike venture capital firms, they tend not to invest in new companies. Both combined Universal banks, more commonly known as financial services companies, engage in several of these activities. These big banks are very diversified groups that, among other services, also distribute insurance hence the term bancassurance, a portmanteau word combining "banque or bank" and "assurance", signifying that both banking and insurance are provided by the same corporate entity. Copyright 2012 Published by IJMRR. All rights reserved 338

12 Other types of banks Islamic banks adhere to the concepts of Islamic law. This form of banking revolves around several well-established principles based on Islamic canons. All banking activities must avoid interest, a concept that is forbidden in Islam. Instead, the bank earns profit (markup) and fees on the financing facilities that it extends to customers. FINDINGS During the period more than 74% of the cash came from trading activities. In the application of cash around 68% utilized for investing in fixed assets. During the period to more than 55.68% of the cash came from trading activities. In the application of the cash around 81.17% of the cash are utilized for investing in fixed assets. During the period to more than 69.54% of the cash came trading activities. In the application of the cash 32.32% of the cash are utilized for investing in fixed assets. During the period to more than 47.74% of the cash came trading activities. In the application of the cash 71.64% of the cash are utilized for investing in fixed assets. During the period to more than 54.25% of the cash came trading activities. In the application of the cash 71.64% of the cash are utilize for the investing in fixed assets. During the period to more than % of the cash came trading activities. In the application of the cash % of the cash are utilize for the investing in fixed assets. CONCLUSION The Kotak Mahindra Net Profit is showing negative profit in the year These event is an expected one because since from the previous two years it is showing the decline stage in Net Profit. Profit Margin of Kotak Mahindra is decreasing and showing negative profit because there is increase in the price. The Kotak Mahindra Net Working Capital Ratio is satisfactory. The Kotak Mahindra return on Total Assets shows a negative sign in the year The Operating Ratio of Kotak Mahindra increase in the year , in the year and reached in the year so the company has to reduce its operating costs. The Operating cash of Kotak Mahindra satisfactory. Due to increase in cost of production, this ratio is decreasing. So the has to reduce its office administration expenses SUGGESTIONS For the improving the financial performance of the company the following suggestions are made. Copyright 2012 Published by IJMRR. All rights reserved 339

13 In order to reduce the outside borrowings in the company has to acquire. The capital from equity sources. Keeping in view the debt equity the proportion as normal. The liquidity of the company should be improved by maintaining the optimum current assets and liquid assets according to standard norms. The quantum of the sales generated should be improved impressively in order to attain higher return on investment. To improve the financial health of the company and maximizing the time between the source mobilization and utilization the management must introduce the new cost saving techniques. REFERENCES Panday IM. Financial Management. Chandra P. Financial Management. Khan MY, Jain PK. Financial Management. Mohan M, Goyal SN. Principles of Management. Maheswari SN. Financial Management Copyright 2012 Published by IJMRR. All rights reserved 340