Mehdi Oil Industries

EXECUTIVE SUMMARY

BACK GROUND OF THE STUDY:

M.Com requires to undergo an internship of two months in a private or a
public sector organizati on. The purpose of this internship is to acquaint
the students with the practi cal knowledge of administrati on.

PURPOSE OF THE STUDY:

Mehdi Oil Mills is a well-known organizati on of the oil industry in order
to set knowledge of this organizati on for the student of Master of
Commerce specially it is important to know all the fi nancial acti viti es.

METHODOLOGY OF THE STUDY:

During internship the most important task was to collect more quality
informati on about the organizati on. For this purpose a number of
techniques were adopted to collect the require material and conduct the
report. Methodology is based on both primary and secondary data. The
primary data consist of discussions, interviews and personal observati on.
The source of secondary data was manuals, relevant books, monthly
economic reports and annual reports.

SCOPE OF STUDY:
This internship report has been completed in Mehdi Oil Mills. Being a
student of fi nance, my focus was mainly on the fi nance department and
accounts department . The focus of the report was to learn how they
fi nance their acti viti es, recording transacti ons, what are their books of
journals and many other fi nance acti viti es. So this report covers all
aspects of MOM.

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Mehdi Oil Industries

INTRODUCTION TO THE ORGANIZATION

(GROUP)

Apollo Texti le Mills was setup in 1973 and being a public limited
company, it ’s listed on Pakistan stock exchange. The Company is engaged
in the manufacturing and trading of high quality Yarn to internati onal
markets. The Company has two operati ng units located both at Lar near
Multan with 3,000 individuals employees. Head Offi ce of the company is
located in the heart of the fi nancial district of Karachi, which is the hub
of the business center of Pakistan. Acti viti es mostly dealing with the
procurement of Raw Cott on transpire at the Multan offi ce.
Mehdi oil Mills Ltd. Is one of the ventures of Apollo Texti le Mills Ltd.

Mehdi Oil Mills conti nued to aim for newer heights and as a result
registered a phenomenal growth both in terms of producti on and sales.
The objecti ve is to ensure consistent quality to its customers and their
complete sati sfacti on.

Apollo is equipped with 90,600 spindles, the mills annual capacity is

50,000 tons of yarn. Numbers of shift s worked per day are three and the
mills are running 365 days in a year.

MULTAN OFFICE

Multan offi ce mostly deals with the procurement of raw material. The raw
material is purchased with Strict Quality control guidelines in place. Prior
to purchase of raw cott on, samples are tested at our In-House labs to
ensure cott on inputs are in alignment with our defi niti on of quality. The
inspecti on and testi ng procedures at labs ensure that raw materials are
not processed unti l inputs have passed through rigorous inspecti on
procedures or otherwise verifi ed as confi rming to customer ’s
requirements.

 To ensure and maintain high quality, raw cott on from the premium
growing areas of Punjab which is procured through a well-trained and
experienced team of selectors.

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Mehdi Oil Industries

 To ensure year round availability of raw material, highest quality of

cott on which is stocked up in the peak cott on season for the maximum
quality sati sfacti on of our customers.

MISSION

Mehdi Oil Mills is committ ed to achieve excellence in the quality of its

product and sati sfacti on of customers through reliability.

 To strive to keep up with the modern technology in the industry.

 To respond to customers ever changing needs in the most eff ecti ve
way.
 To maintain superior quality and make it as our strength.
 To be devoted and stringent to commitments and quality in order to
gain customer confi dence.

FUTURE VISION

Mehdi Oil Mills is committ ed to achieve excellence in the quality of its

product and sati sfacti on of customers through reliability.

 To strive to keep up with the modern technology in the industry.

 To respond to customers ever changing needs in the most eff ecti ve
way.
 To maintain superior quality and make it as our strength.
 To be devoted and stringent to commitments and quality in order to
gain customer confi dence.

STRATEGY
MON have made pioneering eff orts in development of new products,
which has enabled us to emerge as a market leader. This together with an
innovati ve and professional management style has helped us to build a
strong and fi nancially sound base.

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Mehdi Oil Industries

STRENGTHS

MOM is determined to convert its vision into reality by using innovati on

to create a market niche for their products and by investi ng in faciliti es,
people, systems and new technology, diversifi cati on into value additi on
and improvements in producti vity and service to customers.

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Mehdi Oil Industries

CORPORATE INFORMATION
BOARD OF DIRECTORS
Chief Executi ve:
Mr. Ikram Zahur
Directors:

Mr. Abdul Rehman Zahur

Mr. Muhammad Tahir Khan

Miss. Nosheen Rasheed

Miss. Samina Ebrahim

Miss. Huma Lodhi

Miss. Hina Naz

BANKERS
 Saudi pak
 Soneri
 Standard Chartered
 Bank of Punjab
 PICIC
 Nati onal Bank
 Habib Bank AG Zurich
 Bank Al Falah
 Mybank

CONTACTS
LOCATION AND CONTACT INFO
Multan Offi ce:
Chak 21/MR Adda Lar, Bahawalpur Road, Multan.

Phone: (92)-21-554-9057-8 Fax: +92 (21) 5335-9021 & 2

UAN +92 (21) 111-578-526
Email: [email protected]

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Mehdi Oil Industries

INTRODUCTION TO DEPARTMENTS & MY

ASSIGNMENTS AS INTERNEE:

In MOM, there are various departments, I have visited almost all the departments.
Following are the names of the various departments:

1. Human resources department.

2. Purchase department.
3. Sales department
4. Finance department.
5. Foreign trade department
6. Industrial engineering department.
7. Stores departments.

A few findings on my duties in various departments, mainly in finance department are as

under:

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Mehdi Oil Industries

HUMAN RESORUCES DEPARTMENT IN MEHDI OIL

MILLS

Objecti ves of HR Department:

 To help the organizati on to reach its goals.

 To increase employee’s job sati sfacti on and moti vati on.
 To employ the skills and abiliti es of the workforce effi ciently.
 To develop and maintain a quality of working.
 To communicate and implement HR policies.

FUNCTIONS OF HRD
HR department in MEHDI OIL MILLS is involved in diff erent types of
human resource development and human resource development
acti viti es. Here are the acti viti es of HR department in MEHDI OIL MILLS;
 Recruitment
 Training and Development
 Compensati on
 Performance Appraisals
 Employee welfare
 Rewards and Punishments
 Reti ring and Terminati on Benefi ts

1- RECRUITMENT:

HR Department in MEHDI OIL MILLS regarding recruitment is almost

online up to the middle level management and has the following
procedure;
 Approved strength in each department
 Invitati on of vacant or new positi on applicati ons
 Scruti nizing of applicati ons.
 Test including intelligence and apti tude tests
 Interviews in panel form

2- TRAINING AND DEVELOPMENT:

The training and development process in MEHDI OIL MILLS is very strong
and has following setup

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Mehdi Oil Industries

A- Indoor Training
 Apprenti ces
 Trainee supervisors
 Trainee Operators
 Trainee Engineers
 Management Trainees
 Trainee Offi cers
 Trainee business analyst
B- Out Door Training
 Training in insti tuti ons
 Meeti ngs and reviews

3- COMPENSATION
MEHDI OIL MILLS has setup for workers as
 Market rate
 Overti me
 Incenti ves
 Vehicles
 Accommodati on

4- REWARDS AND PUNISHMENT:
MEHDI OIL MILLS gives in terms of rewards
 Appreciati on
 Cash Prizes
 Promoti ons

In MEHDI OIL MILLS for the control purpose there are also punishments
 Disciplinary Acti ons
 Show cause noti ces
 Suspension
 Terminati ons
 Charge sheets
 Fines

5- PERFORMANCE APPRAISALS:
Promoti ons in MEHDI OIL MILLS have very fair methodology. Personality
and job related traits are evaluated at regular basis. Best performance
results in good rewards in MEHDI OIL MILLS.

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 Mehdi Oil Industries

6- EMPLOYEE WELFARE:
There are many employee benefi ts policies being followed in MEHDI OIL
MILLS. Some of them are as follows;
 Health insurance
 Social Security
 Transportati on
 Canteen and Mess

7- RETIRING AND TERMINATION:

Gratuity and provident fund is being maintained for the reti ring personals
in MEHDI OIL MILLS.
HR department in MEHDI OIL MILLS is almost computerized and includes

 HRMS ( Human Resource Management System)

 GMS (Gate Management System)
 JMS ( Job Management System) (Yet to be Introduced)
 JOB Bank (Yet to be Introduced)

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Mehdi Oil Industries

PURCHASING DEPARTMENT:-

Purchasing department performs the following functi ons

 Market analysis
 Data analysis
 Procurement
 Visual presentati ons
 Feed back
 Product planning
 Pricing
 Distributi on

Market analysis includes anti cipati on of future trends in the market

regarding economic, life style, fashion and competi tors. Currently MEHDI
OIL MILLS anti cipates the future competi tors like China and India in result
of WTO policies and now successful competi ng the china in quality and
price.

Analyzing all the available data for improvement and anti cipati on,
Merchandiser also search about the accessories purchase and to
negoti ate. Product planning concerns about sampling and regarding
research and development.

The merchandiser starts his work with new inquires, new inquires are the
customers fi rst knock at MEHDI OIL MILLS. The merchandisers increase
the sale of products through personal selling, seminars and physically
stall presentati on in worldwide cloth fairs and exhibiti ons. But currently

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Mehdi Oil Industries

due to high quality of MEHDI OIL MILLS and customers trust on MEHDI OIL
MILLS quality MEHDI OIL MILLS only relying on personal selling or old
customer relati ons.

When new inquires comes in the merchandising department starts

working on it on the bases of customer demand required in the inquiry.
Merchandising department prepares samples.

Confi rmati on of PO and follow up

Aft er the conformati on of PO the merchandiser sends it to PPC and
producti on department for performing their functi ons. The last functi on
of merchandiser is follow up of the PO from sample to shipment and
communicates with the customer.

STORES DEPARTMENT
It is the acquisiti on of goods and services at the best possible cost of
ownership in the right quanti ty at the right ti me in the right place for the
direct benefi ts of the organizati on.

Functi ons of procurement department.

o Take acquisiti on

o Price negoti ati on

o Order place

o Shipment of goods

o Time line

o Follow up tools

o IGP&GRN

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 Mehdi Oil Industries

o Accessories

o Payments of purchased goods

Types of Stores
1) Main store
2) Fabric store (Stock pledge)
3) Shipment store

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FINANCE DEPARTMENT
Finance department of the MOM is responsible to arrange funds for
working capital as well as for purchase of assets and raw materials etc.
Finance department is responsible to maintain books of accounts
conducti ng internal and external Audits, interacti on with Income Tax,
Sales Tax Authoriti es and Financial Insti tuti ons. Dealing with company
suppliers, agents and other government insti tuti ons are also the
responsibiliti es of this department.

Finance department is headed by the directors at Multan offi ce. Senior

manager F & C facilitates Deputy manager who is responsible to manage,
guide and control the chief accountant, Deputy chief accountant and
senior cost accountant, sale supervisor and costi ng assistant are also lead
by the senior manager F & C.

FINANCE DEPARTMENT STAFF:

 Senior Deputy Chief Accountant:

Senior deputy chief accountant is responsible to fi nd the cost of the

producti on and to check the producti on effi ciency report of the company.

 Assistant Accountant:

This person is responsible for all cash transacti ons. Customer ledger,
cashbook and sales journals are maintained by him, preparati on of cash
payment vouchers and cash receipt vouchers are also the responsibiliti es
of assistant accountant.

 Senior Accountant:

This person is responsible for bank transacti on for journal vouchers, bank
payment vouchers, bank receipt vouchers, maintaining of bankbook,
supplier payment ledger and journal. Moreover he is liable to prepare
bank reconciliati on statement, supplier trial balance at the end of the
month and submit it to the chief accountant.

 Chief Accountant:

The chief accountant is responsible for account secti on. He maintains the
general ledger and sales register. He is also responsible for submitti ng
fi nal account / report to the management on monthly basis. He is the
person who conducts the audit. He looks aft er the sales tax aff airs.

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 Mehdi Oil Industries

 Store Accountant:

Store accountant handles all store requisiti ons, goods receipt notes
inward gate pass and outward gate pass. He maintains the

 Store ledger

 Fixed asset ledger

 Electric items ledger

 Raw materials ledger

MAIN RESPONSIBILITIES OF FINANCIAL MANAGEMENT

It deals with the cash infl ows and outf lows major cash infl ows are
following.
o Sales Collecti on
o Interest of Deposits
o Sales of Wastes
o Capital Gains
Major sources of cash outf low are:-
 Purchase of raw materials.
 Purchase of packing materials.
 Purchase of fuels.
 Wages and Salaries Payments.
 Duti es and Taxes.

BOOK KEEPING

MEHDI OIL MILLS has separate accounts division for book keeping. The
main functi on of book keeping is to record the business transacti on in a
set of books of accounts.
 Daily Payments and receipts entries are recorded in
original book of entries.
 Subsidiary ledgers are used to maintain debit and
credit account.
 Main ledger is prepared for daily journal entries and
monthly trial balance is drawn through it. At the end of the year annual
accounts have been prepared.
Pay Roll
In this secti on att endance record is maintained EPS (Employees
Payroll System) prepare the pay according to company rules.

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Mehdi Oil Industries

AUXILIARY FUNCTION OF FINANCE DEPARTMENT

 Preparati on of fi nancial statement

 Internal control
 Conduct of audit
 Comparison
 Order wise profi t and loss account and their analysis
 Checking of wager and salary
 Procurement bills
 Purchase bills
 GRN

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Mehdi Oil Industries

FINANCIAL ANALYSIS
The fi nancial positi on of the company is of two types which are as
Follows:
Short Term Financial Positi on
Long Term Financial Positi on

There are four major tools to check or evaluate the fi nancial positi on of
the company which are as follows:
1. Rati o Analysis
2. Comparati ve Statements
3. Common Size Statements (Verti cal Analysis)
4. Trend Percentages (Horizontal Analysis)

The informati on contained in fi nancial statements of a company is of

major signifi cance for shareholders, creditors, managers and all that
regularly need to have relati ve measure of the company ’s operati ng
effi ciencies and conditi ons. The analysis of fi nancial statements is based
on the knowledge and use of rati os. In this report I am mainly concerned
with the rati o analysis only.

RATIO ANALYSIS
The purpose of using rati os in the fi nancial statement analysis is to
reduce the amount of data to workable form and to make the data more
meaningful. Rati on analysis is involving methods of calculati ng and
interpreti ng fi nancial rati os in order to assess the fi rm’s performance and
status. The inputs of analysis are the fi rm’s income and balance sheets.
Financial rati os can be divided in to four basic categories:
Liquidity Rati os
Acti vity Rati os
Debt Rati os
Profi tability Rati os

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Mehdi Oil Industries

RATIO ANALYSIS

Table 1 Liquidity ratios

2014 2015 2016
N et Wo r ki n g Capi tal 43,900,680 58,270,964 142,942,204
Cu r rent Rati o 0.84 0.94 0.72
Qu ic k Rati o 0.32 0.40 0.24
Wo r ki n g Cap ital Tur n over 5.27 3.33 2.72

Liquidity Rati o
The rati os including in this category are designed to assist in determining
the fi rm ability to pay its current liabiliti es.
Interpretati on
Current assets indicates that it has highest value in year 2014, while in
year 2016 it declined considerable.
Quick rati o also indicates the same situati on, in year 2016, the company
is seemed in diffi cult positi on.
Working capital turnover rati o has highest value in year 2014 while the
least value in year 2016.
Overall it can be seen that the company has good indicators in year 2014,
while year 2016 doesn’t show good picture.

Table 2 Activity ratios

2014 2015 2016
Average Co ll ec ti on Per i o d 9.28 28.23 19.24
I nvento r y Tu r n over 8.16 5.26 3.53
Ac co u nt s Payab l e Tur n over 135.43 122.91 145.30
Average Paym ent Per i o d 14.31 14.15 13.01
Cas h Co nvers i o n Cyc l e 52.71 92.63 133.43
Fi xed A s s et s Tur n over 7.76 6.50 9.27
To tal As s et s Tur n over 3.59 3.23 4.01

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Mehdi Oil Industries

Average collecti on period has the highest value in year 2015, while in
2016 it decreased to almost 19 days that shows an effi cient fi nancial
eff ort.
Inventory turnover shows that acti vity was very good for the company in
year 2014 while it has decreased in year 2016.
The payment to account payable shows the effi cient payment in year
2015, while in year 2016 it again increased from previous years, which
shows that company is not effi cient in payment to vendors.
Cash conversion cycle shows that in year 2016, it takes almost 133 days to
convert resources in cash, while in year 2014, it was more effi cient in
converti ng resources into cash and collecti ons.
Fixed assets turnover has the highest value in year 2016 that indicates an
overall effi ciency. The same is depicted in Total Assets turnover.

Table 3 Long term Liquidity ratios

2014 2015 2016
Debt Rati o 0.72 0.73 0.89
Debt to Equ it y Rati o 2.93 4.29 9.24
Capi tali zati o n Rati o 0.32 0.42 0.34
Fi xed Ch arge Covera ge Rati o 2.01 1.34 0.85
Ti me I nterest Ear n ed Rati o 1.32 1.43 0.87

Long Term Liquidity Positi on

Long term debt rati os are also known as the fi nancial leverage rati os or
solvency rati os are designed to assist the decision maker in judging
whether the fi rm has too litt le or too much debt. In other words this rati o
is the measuring the indebtedness of any company.
Interpretati on
The company is more concentrati ng on debt instead of equity. On the
average 80% of the assets are fi nanced through the debts, that is not a
good sign for the potenti al investor.

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Mehdi Oil Industries

The debt to equity rati o of MEHDI OIL MILLS is too much high which
shows that the shareholder equity is less than the liabiliti es of the
outsiders. The outsider (creditor) has right on the company assets more
than the owner (shareholders) of the company.
The capitalizati on rati o of the company is less, which shows that the
company is mostly concentrati ng on the short term loans instead of long
term liabiliti es.

Table 4 Profitability ratios

2014 2015 2016
G ro ss Pro fi t Rati o 0.10 0.09 0.07
Op erati n g Pro fi t Rati o 0.07 0.07 0.03
N et Pro fi t Rati o 0.04 0.03 0.04
Ret u r n o n A s s et s 0.06 0.04 0.03
Ret u r n o n Eq u it y 0.15 0.09 0.31
Ear ni n gs Per Sh are 5.29 5.94 4.21

Profi tability Rati os

There rati os show that how much of business is making profi ts or
earnings for its owners. A number of rati os have been calculated to show
the profi tability of the company.
Interpretati on
The gross profi t rati o of the company shows the mixed trend in the fi ve
years of my analysis.
The net profi t rati o also shows the mixed results on the average profi t
rati o is approximately 4%.

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 Mehdi Oil Industries

ANALYSIS & INTERPRETATION

SWOT ANALYSIS
STRENGTHS:

 Mehdi Oil Mills Limited have a strong brand name TARAZE, it is very
popular in customers and have a good eff ect on the company ’s image .

 Mehdi Oil Mills Limited has local employees, some of them are
skilled and others are unskilled. These are cheaper than the non-local
employees because they have no residence allowances, due to this reason
it has strong cost advantages.

 Mehdi Oil Mills Limited has very highly automated machinery. It is

purely computerized . There for it is possible to increase their producti on.
Their producti on capacity is 84400 spindles.

 Strong internal communicati on is the essence of good performance

of the organizati on. Mehdi Oil Mills Limited has proud to have a strong
internal communicati on system inside the organizati on. Internal
telephone system and the database system in accounts department make
it possible to remove the communicati on gap.

 Mehdi Oil Mills Limited is situated in such a locality where there is

no such other big place of employment, so due to this reason the mill has
strong bargaining positi on. General labor is very much cheap as compare
to the big citi es.

 Mehdi Oil Mills Limited has a strong internal control system; it has
its own internal auditi ng department inside the mill premises that has
total check on all transacti ons of the mill as well as check on the assets

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 Mehdi Oil Industries

and operati ons, and working of the Mill. The internal auditor is directly
responsible to the chief executi ve.

WEAKNESSES:

 As there is no much suppliers that provide raw materials, so the

supply of raw material is less than demand of the company, due to this
reason supplies have a strong bargaining power and prices of raw
material are high.

 Mehdi Oil Mills Limited has no Research and Development

Department, as this is a necessary department of every organizati on to
survive in the market.

 Another important defi ciency of MOM is the unawareness of old

employees about computer applicati ons. They don't have strong hold on
the computer.

OPPORTUNITIES:

 Present age is the age of globalizati on, where distances are

reducing, when there will be an open market all over the world, MOM has
also opportunity to increase its export to other countries especially in
case when it has highly automated machinery with ability to boost its
producti on.

 Mehdi Oil Mills Limited has recently made a huge expansion .That
expansion has increased the producti on capacity to large extant .Now the
mill is in positi on to full fi ll not only the domesti c requirement of the
country, but also in the positi on to export its product to other countries .

 With the current situati on where the government of Pakistan is

giving special att enti on to the export of the texti le products, MOM has

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 Mehdi Oil Industries

the golden opportunity to export its high quality yarn to Middle East and
to European countries.

THREATS:

 The close competi tors of MOM are also making expansion in their
producti on capacity. This will not only result in increase of the highly
automated machinery but also may capture the large porti on of the
market share.

 Pakistani Rupee is depreciati ng against its other trading partners,

so it aff ects the profi tability of the fi rm adversely.

 One of the major threats faced by the company is high infl ati on in
the country. Price of raw materials is increasing day by day and this
causes an increase in the cost of producti on .On the other hand, the
prices of yarn is not increasing at that speed.

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Mehdi Oil Industries

FINDINGS:

ABSENCE OF INCENTIVES:

There were no incenti ves given by the govt. Other estates like European
countries enjoy incenti ve on the import traffi c but texti le industry in our
country is not enjoying those types of incenti ves. So Government has to
give them some faciliti es like concession in electric charges and taxes.

ABSENCE OF SKILLED LABOR

the cost of producti on of the mill is very high; this is because of the
absence of skilled labor. They don’t provide training faciliti es to their
employees.

PROBLEM OF RAW MATERIAL

There are only few suppliers of raw materials and other accessories to
Mehdi Oil Mills Limited. So the bargaining power of the suppliers
increases which results in the price of the product will also increase.

MARKET CONSIDERATIONS
In old ti mes no considerati on was given to larger markets, where the raw
materials for the manufacturing industry are easily available at a
reasonable price. It is also the case with Mehdi Oil Mills whose local
market is Multan and Shuja-abad, but it is situated for away from its local
markets, so the cost of producti on is increased.

HIGER TRANSPORTATION COST

MON was established at a distance from its domesti c markets. Therefore
to acquire raw materials for producti on, they bear high transportati on
cost.

ABSENCE OF LOCAL EMPLOYEES

The absence of skilled labor in the local area resulted in hiring labor from
the other areas of Pakistan. These labors are charged higher wages and
accommodati on faciliti es resulti ng relati vely higher producti on cost.
These labors and offi ce staff are more sensiti ve and asked for more
careful dealing.

UN AVAILABILITY OF SOCIAL FACILITIES:

Mehdi Oil Mills provide no hospital faciliti es to their workers. Also they
have no school for the children of the staff. Because of the absence of
school and hospital faciliti es labor is leaving MOM for other citi es.

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Mehdi Oil Industries

SUGGESTIONS & RECOMMENDATIONS

TO HIRE LOCAL LABOR :

As labor is unskilled there for MOM hires skilled labor from other parts of
the country which is very costly, so MOM should provide training to the
local labor, so it will decrease their cost and also improve their image in
the locality.

TECHNICAL TRAINING:
Technical training should be given to the employees to use the modern
machines accurately. This will reduce the repair and maintenance cost.

PROVIDE HOSPITAL AND SCHOOL FACILITIES:

Mehdi Oil Mills Limited should provide school and Hospital faciliti es for
poor employees of the mills, with this they will become committ ed and
their producti vity will be increased.

COMITMENT OF SUPPLIERS
As the numbers of suppliers of cott on is less in the market, and Mehdi Oil
Mills have a strong fi nancial background so it can integrate backward, by
purchasing or getti ng control of suppliers to avoid stock out, however this
situati on of stock out has never arisen.

COMPUTER SYSTEM
Management must try to computerize their system, this will save ti me and
cost of the company, so its profi tability will be increased.

COMPUTER TRAINING:
Proper training should be given to employees to use computer properly.

TO CONTROL WASTE OF PRODUCTION:

MOM must control its waste percentage which is increasing conti nuously
from the last few years, if not controlled it will erase the profi t of the
mill.

CONTROL COSTING:
The mill must control its cost of sale and selling and admin expenses, it is
very important and a challenge for the management from the last few
years.

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Mehdi Oil Industries

CONCLUSION:

Mehdi Oil Mills is a big name in oil mills and texti le concern. The Apollo
Company i.e. the parent company has fully equipped cutti ng, sti tching
and packing units. Its quality assurance system is one of the best in
Pakistan. Recently it wins “Best supplier awards 2007-08” from JC Penny
the World Wide stores chain. The company ’s infrastructure is good.
Offi ces are fully furnished. The company is centrally air-conditi oned. The
company is not working in “Papers less” environment. Computerized bar
coding and back tracking system must be used.

Company has good warehousing capacity for fabrics and garments.

Customer portf olio of the company is very broad. World leaders in
Apparel are working with MEHDI OIL MILLS.

Company has no separate marketi ng department. CEO and Marketi ng

Manager of the company perform marketi ng functi ons individually.
Company is engaged in merchandising and its merchandising department
is very effi cient for taking orders and fulfi lling them accordingly.
Company ’s decision making is centralized. All major decisions are made
by higher management and implemented by lower management.

Now Company is giving preference to its personals separate personnel

department is established and a ladies wing is also incorporated.

Financially the company is performing well. Its sales are increasing and
its profi ts are rapidly growing.

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Mehdi Oil Industries

Table of Contents

EXECUTIVE SUMMARY...................................................................................................1
BACK GROUND OF THE STUDY:.........................................................................................1
PURPOSE OF THE STUDY:..................................................................................................1
METHODOLOGY OF THE STUDY:.......................................................................................1
SCOPE OF STUDY:..............................................................................................................1
INTRODUCTION TO THE ORGANIZATION (GROUP) ................................................2
Multan Office....................................................................................................................2
MISSION............................................................................................................................3
FUTURE VISION.................................................................................................................3
STRATEGY..........................................................................................................................3
STRENGTHS.......................................................................................................................4
Corporate Information.........................................................................................................5
BOARD OF DIRECTORS......................................................................................................5
INTRODUCTION TO DEPARTMENTS & My assignments as internee:..................................6
Human resoruces Department in MEHDI OIL MILLS...........................................................7
Functions of HRD..............................................................................................................7
1- Recruitment:.................................................................................................................7
2- Training and Development:..........................................................................................7
3- Compensation...........................................................................................................8
4- Rewards and Punishment:........................................................................................8
5- Performance Appraisals:...........................................................................................8
6- Employee welfare:....................................................................................................9
7- Retiring and Termination:.........................................................................................9
Purchasing Department:-...................................................................................................10
Stores Department.............................................................................................................11
Finance Department..........................................................................................................13
Main responsibilities of Financial Management............................................................14
Book Keeping..................................................................................................................14
Auxiliary Function of Finance DEPARTMENT..................................................................15
Financial Analysis...............................................................................................................16
Ratio Analysis..................................................................................................................16
Ratio Analysis..................................................................................................................17
Analysis & Interpretation..................................................................................................20
SWOT ANALYSIS.........................................................................................................20
SUGGESTIONS & RECOMMENDATIONS..........................................................................24
CONCLUSION:.....................................................................................................................25

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Mehdi Oil Industries

List of Tables

Table 1 Liquidity ratios...........................................................................................17

Table 2 Activity ratios...........................................................................................17
Table 3 Long term Liquidity ratios........................................................................18
Table 4 Profitability ratios......................................................................................19

Internship Report 27