Title Of The Report

On Job Training Visit Report (On Job Training Activity On)

“Topic”

On Job Training report of visit to any retail outlet near to your place of residence identify
the specific product from it study on its market segment, explain the criteria for
segmentation And suggest marketing approach for each segment

Submitted By:

Student Name:

Mr. Devdatta Milind Panse

PRN/Enrolment No.

22MBA07R1123

Program Name:

MBA

Academic Year:

2022-2024
Sr .No. Title Page No.

1) Introduction 4-5

2) Main Content 6-28

3) Conclusion, Suggestion And 29-30

Recommendation etc.

4) Bibliography 31
 1. INTRODUCTION

Department of manufacture, the professionalism & co-ordination maintain throughout the

organization. During my study I have learn some aspects that have to be improved. So I
have suggested certain changes that need to be made for overall enhancement of the
organization. This project related to the study of changes in current assets & current
liabilities & its effects on the working capital of “SOHAM INDUSTRIES SHIKRAPUR”
Pune.

This project involves the study of past data for the last 3 year. It shows the changes in the
percentage of net working capital as a result of changes in the percentage of current assets
& current liabilities. It also involves an overviews of various function performed by
commercial department.

The purpose of taking up this project in the study the effect of current assets, current
liabilities and working capital on profitability & risk during the period of my study, I learn
about the composition of various current assets and current liabilities in total working
capital. I also observe Debtors showed an increasing trend and formed the largest
components of working capital followed by loans & advances and bank overdraft.

Working on the project with “SOHAM INDUSTRIES SHIKRAPUR” Pune was quite the
challenging task for me. It served as a platform to manage the resource to meets its
working capital need. To provide bank cash & sales cash to survive & do business in the
field. Where competitors are ready to give credit for the longer period to attract clients or
customer.

It helped me to understand the major components of current assets and current liabilities
that affects the net working capital in industry. To sum up my learning experience at
‘SOHAM INDUSTRIES SHIKRAPUR Pune. I understood the basic aspect of various
major components of current assets and current liabilities that from a part of industry, its
changes and affect on the net working capital. I also learn about the various tasks
performed by the commercial department of manufacture
The professionalism & co-ordination maintain throughout department during my study I
have learn some aspects that have to be improved .so I have suggested certain changes that
need to be made for overall enhancement of the organization
2. Main Content

COMPANY PROFILE

SOHAM INDUSTRIES

( 2023 )

Company Name: SOHAM INDUSTRIES

Company Address: GATE NO 1601, CHAKAN CHOWK SHIKRAPUR PUNE

412208 CUSTOMER CARE :7875986313

Registered office: TALEGOAN DHAMDHARE, TAL-SHIRUR, MAHARASHTRA

412208

Email-ID: [email protected]

Logo:
Historical development of the company

Soham industries was established in 2013 with an aim to provide customers

The products they need with amazing ease and economy precision is our passion and jit-
just in time is our mantra we have been giving our customers excellent quality products
and reliable pre and post sales service over all

These year we welcomes new customers to explore the world of Soham industries and
experience our services

Soham industries, in the last 6 years, has emerged as a trusted brand solely because of it
dedication to provide the best with in the give in parameter.

We believe in delivering products that are conduct temporary with best an plush ambience
We aim for our products to be distribute across Pune city. Till date, Soham industries has
divers works areas spread across the affluent suburbs and downtown of the city.

Our founder, Mr. Swapnil Jagtap (director) has been working in the plastic industry since
1997.

With over a decade of experience, our company is a brand of repute in the pace of Pune .It
has been over Endeavour to provide our value customer Soham industries has ground for
strength to strength to become a trustworthy entity that strives to and understand the
global plastic phenomena and adopts the same in local contacts to provide the best
products with class & quality.

We continue the ethical tradition of transparency and quality is set by our ancestors.
 Vision

Our vision is to provide the finest best products to consumers.

MISSION

We , at Soham, aim to continue ethical traditional of transference and quality as set by our
ancestors and let Product be the testimonials of our commitment to excellence.
PRODUCTSPHOTOGRAPH
RESEARCH METHODOLOGY

DEFINATION OF RESEARCH.

Research in common parlance refers to a search for knowledge one can also define
research as scientific and systematic search for permanent information on a specific topic
in fact research is an art of scientific investigation

The advanced learner dictionary of current English lays down the meaning of research as a
careful investigation or inquiry especially through search for new facts in any branch of
knowledge

According to webster dictionary “a studies enquiry examination especially investigation

experimentation aimed at the discovery and interpretation of facts revision of accepted
theories or laws in the light of new facts or practical application of such new or revised
theories or laws.

Method of data collection

Data means facts, data are those things which are certainly known and form which
conclusion may be drawn there two type of data.

1) Primary data
2) Secondary data

1)Primary data:

The primary data are those which are collected a fresh and for the first time and thus
happen to be original data. Such data are published by authorities.

Sources of primary data collection

1)Observation method

2)Interview method
2)Secondary data:

The secondary data are those, have been used previously for any research and now used for
second time. For some research studies, secondary data used. I used collect data from
library as secondary source of data collection. And I also use company website to search a
data.

sources of secondary data

1) Government publications
2) International publications
3) Journals
4) Other services

My project is based on secondary data and I have used financial statements of Soham
Industries for 2016-2022
OBJECTIVE OF THE STUDY

THE STUDY THE OBJECTIVES OF THE STUDY ARE AS FOLLOWS

1. To study the role and concept working capital

2. To study of the factors which impact the working capital of the company with
special reference to SOHAM INDUSTRIES To calculate working capital for last
three year.

SCOPE OF THE STUDY

In the project an attempt has been made to analyse the working capital of company for last
3 year.

1. As the part of the study of working capital and its circulation, statement of
changes in working capital. The study is limited to three Years performance of the
company.
2. The data use in this study have been from published annual report only. As per
the requirement and the necessary some data are grouped and sub grouped.
3. For making a clear-cut opinion, Ratio technique of financial management .
THEORETICAL BACKGROUND

*Basic Accounting Terminology

*INTRODUCTION

Every human being consciously engages himself in meaningful activity. Although the
measure of success may vary in each case one has to be careful and cautious at every
stages in his life. Bookkeeping and accountancy is a science, which has attracted the
attention all such human activity. Accounting enable a person to assess the risk
appropriate steps.

Assets

Assets are the wealth that has been accumulated by the business and is owned outright
without lien or loan. It may be items that depreciate over time, or goods that are sold to
customers. This may include cash and investments, buildings and property, account
receivable, warehouse inventory, equipment and supplies.

Balance sheet

The balance sheet is an important aspect of business. It records the basic accounting
formula of assets = liabilities + stockholder equity / capital at a certain point in time,
either monthly, quarterly or yearly. From the balance sheet the financial health of the
business can be ascertained.

General ledger

The general ledger is the side of the bookkeeping ledger that contains the balance
sheet and the income statement accounts. Here all business transactions are recorded,
including sales, credit purchases, office expenses and income losses.
Gross margin

Gross margin or profit is the total number of sales that have been made, subtracted by
the associated costs, such as manufacturing costs, wholesales costs, material, and
supplies.

Loss

When a service or product sells for less than what it cost to supply or manufacture it, or
when expenses have exceeded revenues of a particular asset, it's called a loss.

On credit/On account

On credit or on account means that products or services have been sold with the use of
credit. Payment has not immediately been provided for these items, and there may be
terms on account that may result in interest charges.

Receipts

Receipts is the total amount of cash collected in business transactions over the course of
one day. It does not include other revenue collected.

Revenue

Income and revenue are interchangeable, compromising the total amount of all income
collected at one point in time. It may include cash sales, credit purchases, subscription
fees and interest income. It differs from receipts, as it can include monies that are not
collected at the delivery time.

Trade discount

A trade discount is a percentage discounted from the purchase price, and is based on the
volume of goods ordered at one point in time. Higher discounts may be applicable to
larger orders, with smaller discounts for lesser orders.
Trial balance

The trial balance is recorded in the general ledger, and includes both debits and credits
for one particular account. The sheet must balance, with debits equaling credits.

Bad debts

Which are irrecoverable and written off from debtors A/C as a loss are turned as bad debts.

Costing

Casting means the total of the book of account casting has to be done of the ledger
accounts and also of journal.

Capital

The dictionary meaning of the term capital is wealth capital is the total account invested in
business the capital of business is the claim of the owner to the business is the claim of the
owner to the business.

Debtors : Debtor is person who owes something hi is the person who has to pay to other
person.

Discount

It is an allowance or a concession allowed by the receiver of benefit to the giver of benefit .

It is normally allowed to the customer , debtors and retailers etc. the discount may be
classified in two ways.

1) Cash discounts

2)Tread discounts

i) Cash discount

A cash discount is an incentive that a seller offers to a buyer in return for paying a bill
owed before the scheduled due date. The seller will usually reduce the amount owed by the
buyer by a small percentage or a set dollar amount. If used properly, cash discounts
improve the days-sales-outstanding aspect of a business's cash conversion cycle.
ii) Tread discount : A trade discount is the amount by which a manufacturer reduces
the retail price of a product when it sells to a reseller, rather than to the end customer.
The reseller then charges the full retail price to its customers in order to earn a profit
on the difference between the amount by which the manufacturer sold the product to
it and the price at which it then sells the product to the final customer

Entry:

the term entry refers to the recording of a transaction in the books of account. It is the
primory record of a transaction in the book called journal or any other subsidiary journal

Folio: it means the page number of the book of orignal entry or of the ledger by writing
folio. i.e. page number , one can esily find out on what page the orignal entry is made and
on what page of the entry is made in the main book.

Goods : commodities in which the trader deals are called as good.

Liabilities : debts owed by a person are called liabilities. Liabilities represent the total
amount of creditors. Debts arise because , goods may be perchased out but payment may
not be made at the time of purchasing the goods.Therefore the totol amount payble to
creditors will be the liabilities.

Posting:transaction entered in the orignal book of entry are also to be recordedin the ledger
on the basis of the entry made in the orignal book is called is posting.

Purchases : the goods bought for resale or manufacture and resale purchases. Purchases
may be classified as

1) Cash purchase

2) Credit purchase

Revenue:it represent the accomplishment of the enterprise until the company has been
successful in selling its products, no revenue is realized. Revenue is the amount that’s add
to the capital.
Sales:the goods sold by a business of cash or on credit are called sales.The sales may be
classified as;

1) Cash sales
2) Credit sales

Stock:goods unsold lying with the business on any given date are called as stock.

Transaction:a transaction are an exchange of money or moneys worth between two

parties.it is dealing between the two parties. it is dealing between the two or more parties.
INTRODUCTION TO WORKING CAPITAL MANAGEMENT

Working Capital Management is a significant fact of financial management due to the fact
that it plays a pivotal role in keeping the wheels of a business enterprise running. Working
capital management is concerned with short term financial decisions that have been
relatively neglected in the literature of finance. The non-ideal production technology and
imperfect market and distribution systems are responsible for the generation of current
assets which block the funds of an enterprise. Working capital is needed to release such
blockage of funds.

Meaning of working capital

The concept of working capital is, perhaps, one of the most misunderstood issues in the
literature of finance. The reason is that it is subject to multiple connotations. Some define it
as excess of current assets over current liabilities. These net concepts are based on „gone
concern‟ approach. A „going concern‟ approach takes a total view of the business and
considers gross current assets as the gross working capital requirement of a business, and
management of working capital as management of current assets and current liabilities to
ensure dynamic stability between generation of current assets and their funding operations.

Gross working capital:-

It refers to the firms investment in current assets. The sum of total current assets is
called gross working capital. Current assets are the assets, which can be converted into
cash within a one accounting year or operating cycle, & include cash short-term securities,
debtors, receivable, & stock.

Net working capital:-

It is the difference between the current assets & current liabilities. Current
liabilities are those claim of outside which are expected to mature for payment within one
accounting year. Net working capital is positive & negatives both. If a current asset is more
than current liabilities, it will call positive net working capital & Current liabilities is more
than current assets, it will call negative working capital.
Accounts payable management Scope of working capital:

 Maintain the adequate level of working capital, always to meet the rising turnover,

 Sufficient liquidity to meet short-term obligation & when they arise also to avail
market opportunities like purchase of raw material at low prices or at attractive
discount.
 Proper interdepartmental co-ordination to minimize working capital investment. I.e.
co-ordination between the marketing department & production department.
 Selection of appropriate sources of working capital viz trades credit, bank finance,
or other short-term finance as well as long term finance.
 It becomes easy to avail finance for the working capital if the firm banker
relationship are good and built on strong good faith.

For the purposes of optimizing working capital, the most important factors are:

 Accounts receivables management

 Inventory management
 Liquidity and Cash management

Receivable Management

Trade credit arises when a firm sells its product or services on credit and does not receive
cash immediately. It is an essential marketing tool, acting as a bridge for the movement of
goods through production and distribution stages of customers. A firm grants trade credit:

 To protect its sales from the competitors and,

 To attract the potential customers to buy its product at favourable terms.
Trade credit creates account receivable. The customers from whom receivables or book
debt have to be collected in near future are called as trade debtors or simply as debtors and
represent the firms claim or asset. The credit sales have three characteristics:-

It involves an element of risk that should be carefully analysed

 Credit sales is based on economic value

 The buyer will make the cash payment for good or services received by him in a
future period.

Debtors constitute a substantial portion of current assets of several firms. Trade debtors
are the major part of current assets. The interval between the date of sale and the
payment has to be financed out from working capital of an organization. This
necessitates the firm to get funds from banks or other sources. Thus, trade debtors
represent investment. If substantial amounts are tied-up in trade debtors; it needs
careful analysis and proper management.
Inventory Management

“Inventory refers to the stockpile of the products a firm is offering for the sale and the
components that make up the product”.
In other words, inventory management is a process of maintaining the raw materials when
entered in the company till it is converted into finished goods.
The importance of keeping the right level of inventory lies in the fact that a maximum
proportion of working capital remains blocked in the inventory until it is completely sold
off and debtors realized.

Objectives:
 To minimize investments in inventory
 To meet a demand for the product by efficiently organizing the production and sales
operations
Thus the objective of the inventory management is to maintain an optimum level of
inventory at right place with minimum of cost to avoid a stock out option.
  Maintaining optimum level of inventory also has other benefits like:
 Meeting the market demand when it arises
 Meeting the unexpected demand when it arises
 Handling seasonal or cyclical fluctuations
 Customer satisfaction
 Minimizing cost of sales so that affordability of sales remains

Cost of holding inventory

 Those cost that a rise due to storing of inventory (Carrying Cost)

 The opportunity cost of fund

Benefits of holding inventory

There are various benefits of holding inventory-

 Benefits in Purchasing
 Benefits in Production
 Benefits in Work in Process
 Benefits in Sales

Inventory includes all types of stocks. For effective working capital management,
inventory needs to be managed effectively. The level of inventory should be such that the
total cost of ordering and holding inventory is the least. Simultaneously, stock out costs
should also be minimized. Business, therefore, should fix the minimum safety stock level,
re-order level and ordering quantity so that the inventory cost is reduced and its
management becomes efficient.
The basic responsibility of the finance manager is to make sure the firms cash flows are
managed efficiently. Efficient management of inventory should ultimately result in the
maximization of the owners wealth. In order to minimize cash requirements, inventory
should be turned over as quickly as possible, avoiding stock-outs that might result in
closing down the production line or lead to loss of sales.

Liquidity and Cash Management

Cash is the lifeline of an organization. A sustained growth of an organization depends on

the cash ability of the profit, not the profit per se as reflected in the income statement. The
rising profit curve of an organization may mislead managers into high rates of growth,
which are unsustainable due to the actual cash position of the company. This leads to
continuous erosion of liquidity and may even make a company sick.
There has not been much of cash management in Indian enterprises due to easy availability
of working capital finance from banks. However, recently, cash management as a
discipline is emerging in the country.

Three main activities contribute to the cash flow:

 Operating activities cover cash flows relating to all revenue generating activities of the
organization.
 Investing activities cover cash flows arising from investments.

 Financing activities cover cash flows arising out of all capital and debt issues of the
organization.
 Types of working capital
The type, kinds of a thing are depending upon the different utilization of working
capital. It prominently work in the direction of performing different functions in
different situation and in the context of divergent variable, so following are some
important types of working capital.

1. Permanent working capital:

This type of working capital is known as Fixed Working Capital. Permanent
working capital means the part of working capital which is permanently locked up
in the current assets to carry out the business smoothly. The minimum amount of
current assets which is required to conduct the business smoothly during the year is
called permanent working capital. For example, investments required to maintain
the minimum stock of raw materials or to cash balance. The amount of permanent
working capital depends upon the size and growth of company. Fixed working
capital can further be divided into two categories as under:

(I) Regular Working capital:

 Minimum amount of working capital required to keep the primary
circulation. Some amount of cash is necessary for the payment of wages,
salaries etc.
(II) Reserve Margin Working capital:
Additional working capital may also be required for contingencies that may
arise any time. The reserve working capital is the excess of capital over the
needs of the regular working capital is kept aside as reserve for
contingencies, such as strike, business depression etc.

2.Temporary Working Capital:

The term variable working capital refers that the level of working capital is temporary and
fluctuating. Variable working capital may change from one assets to another and changes
with the increase or decrease in the volume of business. The variable working capital may
also be subdivided into following two sub-groups.

1. Seasonal Variable Working capital:

Seasonal working capital is the additional amount which is required during the
active business seasons of the year. Raw materials like raw-cotton or jute or
sugarcane are purchased in particular season. The industry has to borrow funds for
short period.

2. Special variable working capital: Additional working capital may also be needed to
provide additional current assets to meet the unexpected events or special
operations such as extensive marketing campaigns or carrying of special job etc.

3. Gross Working Capital:

Gross working capital refers to total investment in current assets. The current assets
employed in business give the idea about the utilization of working capital and idia about
the economic position of the company. Thus, gross working capital the amount of funds
invested in different current assets. Gross working capital concepts is popular and
acceptable concept in the field of finance.

4. Net Working Capital:

Net working capital means current assets minus current liabilities. The difference between
current assets and current liabilities is called the net working capital. If the net working
capital is positive business is able to meet its current liabilities. Net working capital
concept provides the measurement for determining the creditworthiness of company.

5. Balance sheet working capital:

Balance sheet working capital is one, which is calculated from the items appearing in the
balance sheet. Gross working capital, which is the representation by the access on current
assets over current liabilities. Is example of balance sheet working capital.

6. Cash working capital:

It is one, which is calculated from the items appearing in profit and loss account. It shows
the real flow of money or value at a particular times and considered to be the most realistic
approach in working capital management. It is the basic of his operation cycle concept,
which has assumed a great important in the financial management in resent year. The
reason is that the cash working capital indicates he adequacy of the cash flow which is an
essential pre requisite of the business.

It emerges when current liabilities exceed current assets, such a situation if absolutely
Theoretical and occurs when a firm is nearing a crises of some magnitude.

Sources of working capital

1.Permanent or fixed working capital.

2. Temporary or variable working capital.

A constant flow of working capital is an intrinsic component of a successful business. This

is especially true considering the outflow that is a part and parcel of every cycle: salaries
and wages need to be paid; raw materials need to be purchased and equipment need to be
serviced; funds are needed for marketing, advertising, and other general overhead costs;
reserves are required till the customers make their payment. Working capital is truly the
lifeline for any company.

The question arises as to how a business acquires

Short term sources
funds for working capital. There are two types of
1. Commercial bank
financing: short term and long term.
2. Indigenous bank
3. Trade creditors The various sources for financing working capital
4. Installment credit are as follows.
5. Advance
6. Account receivable
credit
7. Accrued expenses
8. Differed income
9. Commercial paper

Long term sources

1. Shears
2. Debenture
3. Public deposits
4. Plugging back of profit
5. Loan from financial
institution
Working Capital Cycle

A positive working capital cycle balances incoming and outgoing payments to minimize
net working capital and maximize free cash flow. For example, a company that pays its
suppliers in 30 days but takes 60 days to collect its receivables has a working capital cycle
of 30 days. This 30-day cycle usually needs to be funded through a bank operating line,
and the interest on this financing is a carrying cost that reduces the company's profitability.
Growing businesses require cash, and being able to free up cash by shortening the working
capital cycle is the most inexpensive way to grow. Sophisticated buyers closely review a
target's working capital cycle because it provides them with an idea of the management's
effectiveness at managing their balance sheet and generating free cash flow.
The above and network diagram may offer a clear picture of complete of working capital
i.e. it is a cash phenomenon. In the diagram ,row material , stock refers to material only. In
work in process component involve are raw material, wages and overhead more
specifically manufacture overhead. Finished stock consist components of material, wages
and overhead inclusive of factory, office and administration and selling distribution.
Debtors include material, wages, and profit. Credit involve for the component of raw
material, etc. something a contingency margin is also given while estimating the working
capital management.

The operating cycle consists of following event, which continues throughout he life
of a firm remaining engaged commercial activities.

Avg. stock of raw material

Raw material holding period =

Avg. cost of consumption per day

Conclusion:-

Financial position of the “SOHAM INDUSTRIES” is a good.

Management of working capital is efficient, effective and healthy because of that the
receivable is strong as compare to current liabilities.

Taking into considering the component of gross working capital I conclude that
management is taking care of the working capital.

The net profit ratio is observed to be very good for the company.
SUGGESTIONS :-

Debtors are increasing day by day. If they are not recovered within proper span of time
there is possibility or danger of locking of working capital or there is danger of bad debts.
Both the situations are dangerous for the financial health of company. So proper efforts
should be taken to recover bad debts.

 For the purpose of inventory holding there is no specific methods adopted by the
company. Company should adopt any one of technique such as ABC Analysis or
just in time which is suitable to them so flexibility can be achieved in material
handling.
 System like standard costing can be implemented for the better result in future.

 Sales should be given on more important as it has a scope for improvement as the
market demand is good.

 Marketing of the product should be focused on business to consumer as till now

the focus of the company is on business to business.

 To reduce the cost incurred on direct labour, skilled labours can be hired.

 Proper tender should be passed to get raw material at a cheaper rate so that it can
help in controlling direct expenses.

 More power efficient machines and tools can be used to reduce power
consumption.
Bibliography

1. Anita Shula, working capital management . RBSA Publishers.

2. N.M.V Echalekar Financial Management , Nirali Publisher.

3. Financial management , The ICAI

4. C.R. Kothari, Research Methodology

5. Financial Service, M.Y. Khan