AN ANALYSIS ON CASH MANAGEMENT AT STANDARD POLYMERS, PUDUCHERRY

SUMMER PROJECT REPORT

Submitted by R.ANAND BABU REGISTER NO: 27348302 Under the Guidan e !" Mr#$ R. HEMALATHA, M%A$ &a u'ty, De(artment !" mana)ement #tudie#
in partial fulfilment for the award of the degree of

MASTER O& %USINESS ADMINISTRATION

DEPARTMENT OF MANAGEMENT STUDIES

SRI MANAKULA VINAYAGAR ENGINEERING COLLEGE PONDICHERRY UNIVERSITY PUDUCHERRY

SEPTEM%ER* +,,-

SRI MANAKULA VINAYAGAR ENGINEERING COLLEGE

MADAGADIPET PUDUCHERRY
DEPARTMENT OF MANAGEMENT STUDIES
BONAFIDE CERTIFICATE
Thi# t! erti"y that the (r!.e t /!r0 entit'ed !AN ANALYSIS ON CASH # REGISTER NO: 27348302 $ in (artia' "u'"i'ment !" the

MANAGEMENT AT STANDARD POLYMERS PUDUCHERRY" i# a b!na"ide /!r0 d!ne by R.ANAND BABU

re1uirement "!r the a/ard !" Ma#ter !" %u#ine## Admini#trati!n by P!ndi herry Uni2er#ity durin) the a ademi year +,,- 3 +,,4$

GUIDE

HEAD OF DEPARTMENT

Submitted "!r 5i2a*5! e E6aminati!n he'd !n

E%TERNAL E%AMINER

AC7NO8LEDGEMENT
&ir#t and "!rem!#t, I am 2ery than0"u' t! the '!rd a'mi)hty "!r ha2in) be#t !/ned u(!n hi# )ra e, /ith!ut /hi h I /!u'd n!t ha2e )!t the #tren)th t! !m('ete my (r!.e t$ I ta0e thi# !((!rtunity t! e6(re## my dee( #en#e !" )ratitude t! SHRI.N.KESAVAN &!under (r!.e t$ I e6(re## my immen#e )ratitude t! !ur Prin i(a' Chairman, SHRI.M.DHANASEKARAN, Mana)in) Dire t!r and SHRI.S.V.SUGUMARAN 5i e*Chairman !" !ur !''e)e "!r their )!!d /i#he# "!r thi#

DR.V.S.K.VENKATACHALAPATHY "!r hi# #u((!rt and en !ura)ement "!r the !m('eti!n !" my (r!.e t$ I e6(re## my dee(e#t )ratitude t! M&. JAYAKUMAR, M$E$, M$%$A$, MISTE Pr!"e##!r and Head !" the De(artment !" Mana)ement Studie#, Sri Mana0u'a 5inaya)ar En)ineerin) C!''e)e, "!r hi# #u((!rt, en !ura)ement and enthu#ia#m thr!u)h !ut the (r!.e t$ The 2a'uab'e and un"'in hin) re1uita' #u((!rt in thi# Endea2!r M&'.R.HEMALATHA M$%$A$, my interna' )uide /h!#e a##i#tan e /a# immea#urab'e t! the !m('eti!n !" thi# (r!.e t$ I e6(re## my )ratitude and re#(e t t! a'' the #ta"" member# !" STANDARD POLYMERS, e#(e ia''y my (r!.e t )uide MR. NATARAJAN #u e##"u''y$ I ta0e immen#e ('ea#ure t! than0 a'' in#(irin) #(irit# behind the #u e## !" the (r!.e t$ De(uty &inan e

Mana)er, "!r hi# !n#tant )uidan e and #u((!rt that he'(ed me t! !m('ete my (r!.e t

ABSTRACT

The need "!r Ca#h t! run the day*t!*day bu#ine## a ti2itie# ann!t be !2erem(ha#i9ed$ One an hard'y "ind a bu#ine## "irm, /hi h d!e# n!t re1uire any am!unt !" Ca#h$ Indeed, "irm# di""er in their re1uirement# !" the Ca#h$

A "irm #h!u'd aim at ma6imi9in) the /ea'th !" it# #hareh!'der#$ In it# endea2!r t! d! #!, a "irm #h!u'd earn #u""i ient return "r!m it# !(erati!n$ Earnin) a #teady am!unt !" (r!"it re1uire# #u e##"u' #a'e# a ti2ity$ The "irm ha# t! in2e#t en!u)h "und# in urrent a##et "!r )eneratin) #a'e#$ Current a##et are needed be au#e #a'e# d! n!t a#h$ The !b.e ti2e# are t! ana'y9e the Ca#h mana)ement and t! determine e""i ien y in a#h, in2ent!rie#, debt!r# and redit!r#$ &urther, t! under#tand the 'i1uidity and (r!"itabi'ity (!#iti!n !" the "irm$ The#e !b.e ti2e# are a hie2ed by u#in) rati! ana'y#i# and then arri2in) at !n 'u#i!n#, /hi h are im(!rtant t! under#tand the e""i ien y : ine""i ien y !" Ca#h$ It /a# n!ti ed in the #tudy that the !m(any had uti'i9ed it# Ca#h e""i ient'y and an a'#! try t! )et m!re e""e ti2e 2a'ue# by /!r0in) !n it$ The a#h re1uired t! meet !ut the urrent 'iabi'itie# i# maintained at a n!rma' 'e2e' that #h!/# the !m(any "!''!/# an a2era)e (!'i y$ !n2ert int! a#h in#tantane!u#'y$ There i# a'/ay# an !(eratin) y 'e in2!'2ed in the !n2er#i!n !" #a'e# int!

LIST OF TABLES

T()*+ N,. ;$< ;$+ ;$>$< ;$>$+ ;$>$> ;$>$? ;$>$; ;$>$A ;$?$< ;$?$+ ;$?$> ;$?$? ;$?$; ;$?$A ;$?$;$?$4 ;$?$= ;$?$<, ;$?$<< ;$?$<+ ;$?$<> ;$?$<? ;$?$<; ;$?$<A ;$?$<;$?$<4

N(-+ ,. /0+ T()*+ Ca#h "r!m !(erati!n Ca#h "'!/ #tatement In2ent!rie# Sundry debt!r# Ca#h:ban0 L!an# @ Ad2an e# Current 'iabi'itie# Current A##et# Current A##et t! &i6ed A##et Current A##et t! T!ta' A##et Net /!r0in) a(ita' Rati! In2ent!rie# t! Current A##et Rati! Sundry Debt!r# t! Current A##et Rati! L!an# @ Ad2an e# t! Current A##et Rati! Ca#h t! Current A##et Rati! Ca#h t! 8!r0in) Ca(ita' Rati! Ca#h t! Sa'e# Rati! Ca#h Rati! Current Rati! Li1uidity Rati! Su(er Bui 0 Rati! 8!r0in) Ca(ita' Turn!2er Rati! In2ent!ry Turn!2er Rati! Debt!r# Turn!2er Rati! Debt C!''e ti!n Peri!d Ca#h Inter2a' Mea#ure Rati!

P(1+ N,. += >, >< >+ >> >? >; >A >4 >= ?, ?< ?+ ?> ?? ?; ?A ??4 ?= ;, ;< ;+ ;> ;? ;;

LIST OF CHARTS

T()*+ N,. N,. ;$?$< ;$?$+ ;$?$> ;$?$? ;$?$; ;$?$A ;$?$;$?$4 ;$?$= ;$?$<, ;$?$<< ;$?$<+ ;$?$<> ;$?$<? ;$?$<; ;$?$<A ;$?$<;$?$<4

N(-+ ,. /0+ C0(&/'

P(1+

Current A##et t! &i6ed A##et Current A##et t! T!ta' A##et Net /!r0in) a(ita' Rati! In2ent!rie# t! Current A##et Rati! Sundry Debt!r# t! Current A##et Rati! L!an# @ Ad2an e# t! Current A##et Rati! Ca#h t! Current A##et Rati! Ca#h t! 8!r0in) Ca(ita' Rati! Ca#h t! Sa'e# Rati! Ca#h Rati! Current Rati! Li1uidity Rati! Su(er Bui 0 Rati! 8!r0in) Ca(ita' Turn!2er Rati! In2ent!ry Turn!2er Rati! Debt!r# Turn!2er Rati! Debt C!''e ti!n Peri!d Ca#h Inter2a' Mea#ure Rati!

>4 >= ?, ?< ?+ ?> ?? ?; ?A ??4 ?= ;, ;< ;+ ;> ;? ;;

CONTENTS

CHAPTER LIST O& TA%LES LIST O& CHARTS

TITLES

PAGE NO

INTRODUCTION PRO&ILE O& THE COMPANY NEED &OR THE STUDY

< + =

II III I5 5

RE5IE8 O& LITERATURE O%CECTI5ES O& THE STUDY RESEARCH METHODOLOGY DATA ANALYSIS AND INTERPRETATION &INDINGS O& THE STUDY, SUGGESTION AND RECOMMENDATIONS

<, ++4 += ;A ;4 ;= A, A< A+

5I

5II 5III

CONCLUSION SCOPE &OR THE &UTHER STUDY LIMITATION O& THE STUDY %I%ILIOGRAPHY

CHAPTER I

CASH MANAGEMENT

2.2 INTRODUCTION:
Ca#h i# the im(!rtant urrent a##et "!r the !(erati!n# !" the bu#ine##$ Ca#h i# the ba#i in(ut needed t! 0ee( the bu#ine## runnin) !n a !ntinu!u# ba#i#D it i# a'#! the u'timate !ut(ut e6(e ted t! be rea'i9ed by #e''in) the #er2i e !r (r!du t manu"a tured by the "irm$ The "irm #h!u'd 0ee( #u""i ient a#h, neither m!re n!r 'e##$ Ca#h #h!rta)e /i'' di#ru(t the "irmE# manu"a turin) !(erati!n# /hi'e e6 e##i2e a#h /i'' #im('y remain id'e, /ith!ut !ntributin) anythin) t!/ard# the "irmE# (r!"itabi'ity$ Thu#, a ma.!r "un ti!n !" the "inan ia' mana)er i# t! maintain a #!und a#h (!#iti!n$ Ca#h i# the m!ney /hi h a "irm an di#bur#e immediate'y /ith!ut any re#tri ti!n$ The term a#h in 'ude# !in#, urren y and he1ue# he'd by the "irm, and ba'an e# in it# ban0 a !unt#$ S!metime# near* a#h item#, #u h a# mar0etab'e #e uritie# !r ban0 time# de(!#it#, are a'#! in 'uded in a#h$ The ba#i hara teri#ti !" near* a#h a##et# i# that they an readi'y be !n2erted int! a#h$ Genera''y, /hen a "irm ha# e6 e## a#h, it in2e#t# it in mar0etab'e #e uritie#$ Thi# 0ind !" in2e#tment !ntribute# #!me (r!"it t! the "irm$

2.2 STANDARD POLYMERS

HISTORY3 MILESTONE:

Standard (!'ymer i# it# !ri)ina' "!rm and #tru ture /a# "!unded and #tarted in the year <==, by it# "!under Mr$ &ran i#, "ather !" the (re#ent ina ti2e (artner Mr$ Marie #u#ai ra.$ The !m(any /a# then manu"a turin) !n'y m!n!*'ayer "i'm# and (rinted (!u he# "!r !rdinary hand*(a 0in) !" day*t!*day #e''in) !mm!ditie#$ The !m(any "a ed (r!b'em# in the initia' t/! year# in a hie2in) it# turn!2er tar)et#$ It then )radua''y (i 0ed u( /hen bu'0 !rder# "r!m tami'nadu dairy #e t!r# !u'd be e#tab'i#hed$ The !m(any (!##e##ed a m!n!* 'ayer e6trud#i!n ('ant and a "'e6!*)ra(hi (rinter$ S'ittin) and (!u hin) /ere d!ne by manua' (r! e##e#$ C!ntem(!rari'y an!ther !m(any under the name My'!n ('a#ti # /a# "un ti!nin)$ It /a# "!unded and run by the (re#ent (r!du ti!n mana)er Mr$ Natara.anE# "ather, /h! /a# a th!r!u)h 0n!/'ed)ed (er#!n in indu#tria' #e t!r$ %e"!re ha2in) #tarted hi# !/n 2enture, he /a# a de(ute !" P!ndi herry )!2ernment and /a# entru#ted t! in2e#ti)ate the (!##ibi'itie# !" enhan in) the indu#tria' in"ra#tru ture !" P!ndi herry$ He !u'd )ain '!t !" e6(erien e in thi# "ie'd durin) hi# #er2i e, /hi h m!ti2ated him t! #tart an indu#try !" hi# !/n$ The indu#try he h!#e /a# (a 0in) indu#try, /here (a 0in) materia'# 'i0e mu'ti*'ayer (!'ythene "i'm# and (!u he# made "r!m the#e "i'm# "!r (a 0in) !" "!!d (r!du t# /ere in )reat demand$ He /a# a'#! !n2in ed ab!ut the in rea#in) "uture (!tentia' "!r the demand !" thi# ty(e !" (a 0in) and hen e hi# de i#i!n t! #tart thi# indu#try$ The !m(any /a# then en)a)ed in the manu"a ture !" mu'ti*'ayer (!'ythene "i'm# and +*? !'!ur (rinted (!u he#$ In the year +,,? my'!n ('a#ti # /a# "a in) "inan ia' (r!b'em# t! run the !m(any "urther$ The aidin) %an0 /a# un/i''in) t! "!r/ard "und# "!r the maintenan e and "un ti!nin) !" the !m(any$ S! there ar!#e a !m(u'#i!n, /hen my'!n ('a#ti # ha2e t! #ee0 "inan in) (artner#$ It /a# a'#! de ided "!r the "u#i!n !" b!th the !m(anie#$ i$e$, My'!n ('a#ti # and #tandard (!'ymer#$ Thin)# /ere re*!r)ani9ed in de(utati!n and "un ti!na' re#(!n#ibi'itie# !" (er#!na'#$

PROFILE OF M3S STANDARD POLYMERS

M:#$ Standard (!'ymer# (ri2ate 'imited an be de 'ared a# a medium # a'e indu#try and a# it #tand# t!day /a# !r)ani9ed and re*e#tab'i#hed in the year +,,; /ith "i2e (artner#,

am!n) /h!m three are a ti2e and the re#t t/! are ina ti2e$ The three a ti2e (artner# ha2e ta0en har)e and hand'in) !" the de(artment#$ Mr$ T$ Chandra#e0aran * Admini#trati!n, Pur ha#e @ O2era'' in har)e$ Mr$ Natara.an Mr$ Senthi' 7umar * Pr!du ti!n and Human Re#!ur e#$ * Mar0etin) and Sa'e#$

Mr$ Marie Su#ai Ra. and Mr$ Se'2anaya)am and !ther mi# e''ane!u# dutie#$

T!dayE# (r!"i'e !" M:# Standard P!'ymer# (ri2ate 'imited (!##e# a (i ture !" a /e'' e#tab'i#hed and (r!)re##i2e'y "un ti!nin) !m(any$ The !m(any /ith a (r!du ti!n 2!'ume !" A, t!nne# a m!nth in the year +,,? ha# rea hed a a(a ity !" <A, metri t!ne# a# (er t!day$ The (r!du ti!n ta0e# ('a e in three #hi"t# and e2en then the 2!'ume !" (endin) !rder# ha# rai#ed t! it# brim$ The !m(any i# a(ab'e !" manu"a turin) (a 0in) !2er# !" hi)h #tandard# "!r indu#tria' (a 0in)$ The (re#ent "inan ia' turn!2er ran)e# u(t! t/! r!re# a m!nth$ The !m(anyE# merit# are /e'' e6(!#ed and it# re(utati!n re#(e t"u''y re !)ni9ed by it# u#t!mer# and %an0er#$ The ma.!r u#t!mer# areD

MR& Ltd$, 7era'a, Tiru2!thiyur and P!ndi herry$

Parry# !n"e ti!nery Limited$

Nutrine !n"e ti!nary !m(any FPG Limited$

8inner Dairy FPG Limited$

SNP Dairy mi'0, Madurai$

Ai#/ariya Mi'0 (r!du t#, 5irudha ha'am$

Sar2a Se2a dairy "ederati!n Limited$ FSe2a Mi'0G$

Sar2a #e2a dairy "ederati!n FSar2!daya Mi'0G$

G$7 Dairy, Than.a2ur FDi#tri tG 7uri hi$

%a'a.i Oi' Mi'0, 5anur FLi!n %rand D!ub'e )r!undnut !i'G$

S!uth India "'!ur mi''# Limited, Chennai$

S$M Deter)ent# FPG Limited, C!imbat!re$

7!2i'(atti 'a0#hmi r!''er "'!ur mi''# Limited, Gan)ai0!ndan$

Meena0#hni "!!d# India (ri2ate Limited, Chennai$

5e)a mar0etin) FPG Limited, Dindu)a'$

COMPANY4S LOCATION AND INFRASTRUCTURE

The !m(any /ith it# #ub#idiary unit# !" (r!du ti!n$ Admini#trati!n and !ther "a i'itie# are ('a ed t!)ether in a !m('e6, '! ated at Odiam(et, a 2i''a)e 'yin) !n the !ut#0irt# !" P!ndi herry and ab!ut <+ 7m# "!rm P!ndi herry entre$ The !m(any i# #ituated amid#t a)ri u'tura' 'and# and /e'' a e##ib'e by that r!ad$ %u# #er2i e "r!m and t! P!ndi herry i# a2ai'ab'e t/i e a day$

The !m('e6 i# /e'' ('anned and ('a ed in an area !" ab!ut +$; a re# !" 'and$ The admini#trati2e (remi#e# "a e the r!ad #ide and it# ar hite tura' de#i)n (re#ent# a /e'' e#tab'i#hed !m(any$ The "r!nta)e u(t! r!ad i# )ardened /ith "'!/er ('ant# and )reenery$ A'#! a (ar0in) area in#ide the (remi#e# i# (r!2ided$ The (r!du ti!n unit# are ('a ed behind and ad.!inin) the admini#trati!n bui'din)#$ H!u#in)# "!r (r!du ti!n unit# are /e'' de#i)ned t! !m('y /ith "a t!ry re1ui#ite#$ The h!u#in)# are #(a y "!r the in#ta''ati!n !" ma hine# and "ree m!2ement# !" the /!r0er#$ Ade1uate number# !" /ind!/# (r!2ide "ree ir u'ati!n !" air and "a i'itate "!r ade1uate 'i)ht and 2enti'ati!n$ A e## t! di""erent unit# i# a'#! n!t !m('i ated$ 5ehi 'e a((r!a he# "!r the (ur(!#e# !" '!adin) and un'!adin) area unhindered$ The ba 0yard i# em(ty and 'ar)e en!u)h t! a !mm!date "urther bui'din)#$ P'antati!n !" many tree# a'' ar!und )i2e# en!u)h #hade and "'!/ !" ('ea#ant bree9e, n!t !n'y "!r the em('!yee# but a'#! "!r th!#e 2i#itin) the !m('e6$ 8ater a2ai'abi'ity i# "r!m %!re*/e''#, in#ta''ed in the (remi#e# it#e'"$ P!/er #u(('y i# ta((ed "r!m the e'e tri a' main# runnin) a'!n) the r!ad$

OBJECTIVES 3 FUTURE PLANS OF STANDARD POLYMERS

It /a# under#tand durin) !ur !n2er#ati!n# /ith the Mana)in) Dire t!r that the "u'"i''# the re1uirement# !"

!m(any in the (re#ent ir um#tan e# re1uire# neither t! a'ter n!r t! ad2an e the e6i#tin) (r!du ti!n te hn!'!)y and #tru ture$ The te hn!'!)y ad!(ted t!dayE# (a 0in) indu#try$ The !m(any i# ab'e t! manu"a ture e2en the m!#t #!(hi#ti ated "!rm# !" (a 0in) !2er#$ The 2!'ume !" !ntinuin) !rder#, in #(ite !" !m(etit!r# tend# n!t t! de rea#e$ The !m(any ha# ad!(ted it#e'" t! #uit the #i9e, !r)ani9ati!n #tru ture and (r!du ti!n a(a ity$

The !ntinuin) m!nth'y turn!2er !" R#$ < r!re and ab!2e and the in rea#in) demand "!r it# (r!du t# (ut# M:# Standard P!'ymer# in a !m"!rtab'e (!#iti!n !" maintainin) the !m(any /ith!ut mu h ha9ard#$ The 1ua'ity !" (r!du t# i# in (ar /ith hi)h #tandard# and /e'' a e(ted by it# u#t!mer#$ There i# n! # ar ity in the a2ai'abi'ity !" ra/*materia'$ A !rdin)'y there i# n!

ne e##ity in #ee0 !" !ther te hn!'!)ie#$ Th!u)h #h!rta)e !" 'ab!ur "!r e ari#e# n!/ and then, the mana)ement i# ab'e t! ma#ter thi# (r!b'em thr!u)h 'ab!ur a)en ie#$ In a !rdan e t! Indian 'ab!ur 'a/# and in !n#iderati!n !" hu)e man(!/er, there i# a'#! n! ne e##ity t! )! in "!r "urther aut!mati#ati!n$ On'y in !n#iderati!n !" in rea#in) demand, the admini#trati!n ha# de ided t! (ut u( an!ther (r!du ti!n unit, /h!#e h!u#in) i# under !n#tru ti!n$ Pre i#e'y #(ea0in), the !m(any aim# at maintainin) it# re(utati!n !" #er2in) it# u#t!mer# t! their #ati#"a ti!n and "ree the !m(any at the ear'ie#t "r!m it# e6i#tin) "inan ia' en umbran e$

SHARE CAPITAL AND BANKERS

%!th the !m(anie#, My'!n P'a#ti # and (re2i!u# #tandard (!'ymer# /ere re*!r)ani9ed and "!rmed int! !ne !m(any, /hi h i# t!dayE# Standard P!'ymer#$ The "und# in2e#ted "!r the e#tab'i#hment /a# > r!re#, !m(!#in) !"D aG (artner #hare !" < r!re and bG ban0 "inan e !" "urther + r!re#

%e#ide#, the !m(any /hen e#tab'i#hed (!##e##ed R#$ + r!re# in ma hinerie#, bui'din)# and !ther# a# a(ita' a##et$ The #hare a(ita' !" R#$ +;, ,,,,,, !" ea h (artner#hi( i# !n#tituted !" +;,,,, e1uity #hare !" R#$ <,, ea h, /ith (!/er# t! in rea#e, 'a##i"y, di2ide, #ubdi2ide and !n#!'idate the #ame /ith the (!/er !" atta hin) #u h ri)ht# !" (re"erentia', de"erred !r !ther/i#e a# the a#e may be, determined "r!m time t! time$ The %an0 "!r bu#ine## a ti2itie# !" M:# Standard P!'ymer# i# Indian O2er#ea# %an0 at Reddiear(a'ayam, Pudu herry$

ORGANISATION STRUCTURE

G+5+&(* E6+78/9:+'

Admini#trati2e

Sa'e#

Pr!du ti!n

A !unt#

Audit!r Mana)er Sa'e#man

> E6truder !(erat!r#

> (rinter !(erat!r#

> S'itter !(erat!r#

Data Entrie# Human Re#!ur e C!''e ti!n Su(er2i#!r Se urity Su(er2i#!r

Cashier

He'(er#

2.3 NEED FOR THE STUDY

The im(!rtan e !" Ca#h mana)ement in any indu#tria' !n ern ann!t be !2er#tre##ed$ Under the (re#ent in"'ati!nary !nditi!n, mana)ement !" Ca#h i# (erha(# m!re im(!rtant than e2en mana)ement !" (r!"it and thi# re1uire# )reate#t attenti!n and e""!rt# !" the "inan e mana)er$ It need# 2i)i'ant attenti!n a# ea h !" it# !m(!nent# re1uire di""erent ty(e# !" treatment and it thr!/# Ca#h$ The anti*in"'ati!nary mea#ure ta0en u( by the G!2ernment, reatin) a ti)ht m!ney !nditi!n ha# ('a ed /!r0in) a(ita' in the m!#t ha''en)in) 9!ne !" mana)ement and it re1uire# a uni1ue #0i'' "!r it# mana)ement$ T!day, the (r!b'em !" mana)in) Ca#h ha# )!t the re !)niti!n !" #e(arate entity, #! it# #tudy and mana)ement i# !" ma.!r im(!rtan e t! b!th !n#tant attenti!n !n e6er i#e !" #0i'' and .ud)ment, a/arene## !" e !n!mi trend et , due t! ur)en y and !m('i a y the 2ita' im(!rtan e !"

interna' and e6terna' ana'y#t t! .ud)e the urrent (!#iti!n !" the bu#ine## !n ern#$ Hen e, the (re#ent #tudy entit'ed HA5 A5(*;'9' ,5 C('0 M(5(1+-+5/" ha# been ta0en u($

CHAPTER II REVIEW OF LITERATURE

M+(5951:
Ca#h i# the m!ney /hi h a "irm an di#bur#e immediate'y /ith!ut any re#tri ti!n$ The term a#h in 'ude# !in#, urren y and he1ue# he'd by the "irm, and ba'an e# in it# ban0 a !unt#$ S!metime# near* a#h item#, #u h a# mar0etab'e #e uritie# !r ban0 time# de(!#it#, are a'#! in 'uded in a#h$ The ba#i be !n2erted int! a#h$ hara teri#ti !" near* a#h a##et# i# that they an readi'y

FACETS OF CASH MANAGEMENT:

C('0 -(5(1+-+5/ i# !n erned /ith the mana)in) !"I FiG Ca#h "'!/# int! and !ut !" the "irm, FiiG Ca#h "'!/# /ithin the "irm, and FiiiG Ca#h ba'an e# he'd by the "irm at a (!int !" time by "inan in) de"i it !r in2e#tin) #ur('u# a#h$ It an be re(re#ented by a a#h mana)ement y 'e$ Sa'e# )enerate a#h /hi h ha# t! be di#bur#ed !ut$ The #ur('u# a#h ha# t! be in2e#ted /hi'e de"i it thi# y 'e at a minimum !#t$ At the #ame time, it a'#! #ee0# t! a hie2e 'i1uidity and !ntr!'$ Ca#h mana)ement a##ume# m!re im(!rtan e than !ther urrent a##et# be au#e a#h i# the m!#t #i)ni"i ant and the 'ea#t (r!du ti2e a##et that a "irmE# h!'d#$ It i# #i)ni"i ant be au#e it i# u#ed t! (ay the "irmE# !b'i)ati!n#$ H!/e2er, a#h i# un(r!du ti2e . Un'i0e "i6ed a##et# !r in2ent!rie#, it d!e# n!t (r!du e )!!d# "!r #a'e$ There"!re, the aim !"

a#h mana)ement i# t! maintain ade1uate !ntr!' !2er a#h (!#iti!n t! 0ee( the "irm #u""i ient'y 'i1uid and t! u#e e6 e## a#h in #!me (r!"itab'e /ay$ Ca#h mana)ement i# a'#! im(!rtant be au#e it i# di""i u't t! (redi t a#h "'!/# a urate'y, (arti u'ar'y the in"'!/#, and there i# n! (re"e t !in iden e bet/een the in"'!/# and !ut"'!/# !" a#h$ Durin) #!me (eri!d#, a#h !ut"'!/# /i'' e6 eed a#h in"'!/#, be au#e (ayment# "!r ta6e#, di2idend#, !r #ea#!na' in2ent!ry bui'd u($ At !ther time#, a#h in"'!/ /i'' be m!re than a#h (ayment# be au#e there may be 'ar)e a#h #a'e# and debt!r# may be rea'i9ed in 'ar)e #um# (r!m(t'y$ &urther, a#h mana)ement i# #i)ni"i ant be au#e a#h !n#titute# the #ma''e#t (!rti!n !" the t!ta' urrent a##et#, yet mana)ementE# !n#iderab'e time i# de2!ted in mana)in) it$ In re ent (a#t, a number !" inn!2ati!n# ha2e been d!ne in a#h mana)ement te hni1ue#$ An !b2i!u# aim !" the "irm the#e day# i# t! mana)e it# a#h a""air# in #u h a /ay a# t! 0ee( a#h ba'an e at a minimum 'e2e' and t! in2e#t the #ur('u# a#h in (r!"itab'e in2e#tment !((!rtunitie#$ In !rder t! re#!'2e the un ertainty ab!ut a#h "'!/ (redi ti!n and 'a 0 !"

#yn hr!ni9ati!n bet/een a#h re ei(t# and (ayment#, the "irm #h!u'd de2e'!( a((r!(riate #trate)ie# "!r a#h mana)ement$ The "irm #h!u'd e2!'2e #trate)ie# "!r a#h mana)ement$ The "irm #h!u'd e2!'2e #trate)ie# re)ardin) the "!''!/in) "!ur "a et# !" a#h mana)ement$ C('0 <*(55951: Ca#h in"'!/# and !ut"'!/# #h!u'd be ('anned t! (r!.e t a#h #ur('u# !r de"i it "!r ea h (eri!d !" the ('annin) (eri!d$ Ca#h bud)et #h!u'd be (re(ared "!r thi# (ur(!#e. M(5(1951 /0+ 7('0 .*,=': The "irm #h!u'd de ide ab!ut the (r!(er'y mana)ed$ The a#h in"'!/# #h!u'd be a e'erated /hi'e, a# "ar a# (!##ib'e, the a#h !ut"'!/# #h!u'd be de e'erated$ O</9-8- 7('0 *+:+*: the "irm #h!u'd de ide ab!ut the a((r!(riate 'e2e' !" a#h ba'an e#$ The !#t !" e6 e## a#h and dan)er !" a#h de"i ien y #h!u'd be mat hed t! determine the !(timum 'e2e' !" a#h ba'an e#. I5:+'/951 '8&<*8' 7('0: The #ur('u# a#h ba'an e# #h!u'd be (r!(er'y in2e#ted t! earn (r!"it#$ The "irm# #h!u'd de ide ab!ut the di2i#i!n !" #u h a#h ba'an e# bet/een a'ternati2e #h!rt*term in2e#tment !((!rtunitie# #u h a# ban0 de(!#it#, mar0etab'e #e uritie#, !r inter* !r(!rate 'endin).

MOTIVES FOR HOLDING CASH

The "irmE# need t! h!'d a#h may be attributed t! the "!''!/in) three m!ti2e#I The tran#a ti!n# m!ti2e The (re auti!nary m!ti2e The #(e u'ati2e m!ti2e

TRANSACTION MOTIVE The tran#a ti!n# m!ti2e re1uire# a "irm t! h!'d a#h t! !ndu t it# bu#ine## in the !rdinary !ur#e$ The "irm need# a#h (rimari'y t! ma0e (ayment# "!r (ur ha#e#, /a)e# and #a'arie#, !ther !(eratin) e6(en#e#, ta6e#, di2idend# et $ The need t! h!'d a#h /!u'd n!t ari#e i" there /ere (er"e t #yn hr!ni9ati!n bet/een a#h re ei(t# and a#h (ayment#, i$e$, en!u)h a#h i# re ei2ed /hen the (ayment ha# t! be made$ %ut a#h re ei(t# and (ayment# are n!t (er"e t'y #yn hr!ni9ed$ &!r th!#e (eri!d#, /hen a#h (ayment# e6 eed a#h re ei(t#, the "irm #h!u'd maintain #!me a#h ba'an e t! be ab'e t! ma0e re1uired (ayment#$ &!r tran#a ti!n# (ur(!#e, a "irm may in2e#t it# a#h in mar0etab'e #e uritie#$ U#ua''y, the "irm /i'' (ur ha#e #e uritie# /h!#e maturity !rre#(!nd# /ith #!me anti i(ated (ayment#, #u h a# di2idend# !r ta6e# in the "uture$ N!ti e that the tran#a ti!n# m!ti2e main'y re"er# t! h!'din) a#h t! meet anti i(ated (ayment# /h!#e timin) i# n!t (er"e t'y mat hed /ith a#h re ei(t#$ PRECAUTIONARY MOTIVE The (re auti!nary m!ti2e i# the need t! h!'d a#h t! meet !ntin)en ie# in the "uture$ It (r!2ide# a u#hi!n !r bu""er t! /ith#tand #!me une6(e ted emer)en y$ The (re auti!nary am!unt !" a#h de(end# u(!n the (redi tabi'ity !" a#h "'!/#$ I" a#h "'!/# an be (redi ted /ith a ura y, 'e## a#h /i'' be maintained "!r an emer)en y$ The am!unt !" (re auti!nary a#h i# a'#! in"'uen ed by the "irmE# abi'ity t! b!rr!/ at #h!rt n!ti e /hen the need ari#e#$ Str!n)er the abi'ity !" the "irm t! b!rr!/ at #h!rt n!ti e, 'e## the need "!r (re auti!nary ba'an e$ The (re auti!nary ba'an e may be 0e(t in a#h and mar0etab'e #e uritie#$ a#h #et a#ide "!r Mar0etab'e #e uritie# ('ay an im(!rtant r!'e here$ The am!unt !"

(re auti!nary rea#!n# i# n!t e6(e ted t! earn anythin)D the "irm #h!u'd attem(t t! earn #!me (r!"it !n it$ Su h "und# #h!u'd be in2e#ted in hi)h*'i1uid and '!/*ri#0 mar0etab'e #e uritie#$ Pre auti!nary ba'an e# #h!u'd, thu#, be he'd m!re in mar0etab'e #e uritie# and re'ati2e'y 'e## in a#h$

SPECULATIVE MOTIVE The #(e u'ati2e m!ti2e re'ate# t! the h!'din) !" a#h "!r in2e#tin) in (r!"it*ma0in) !((!rtunity t! ma0e (r!"it may ari#e /hen the #e urity (ri e# han)e$ The "irm /i'' h!'d a#h, /hen it i# e6(e ted that intere#t rate# /i'' ri#e and #e urity (ri e# /i'' "a''$ Se uritie# an be (ur ha#ed /hen the intere#t rate i# e6(e ted t! "a''D the "irm /i'' bene"it by the #ub#e1uent "a'' in intere#t rate# and in rea#e in #e urity (ri e#$ The "irm may a'#! #(e u'ate !n materia'# (ri e#$ I" it i# e6(e ted that materia'# (ri e# /i'' "a'', the "irm an (!#t(!ne materia'# (ur ha#in) and ma0e (ur ha#e# in "uture /hen (ri ?e a tua''y "a''#$ S!me "irm# may h!'d a#h "!r #(e u'ati2e (ur(!#e#$ %y and 'ar)e, bu#ine## "irm# d! n!t en)a)e in #(e u'ati!n#$ Thu#, the (rimary m!ti2e# t! h!'d a#h and mar0etab'e #e uritie# areI the tran#a ti!n# and the (re auti!nary m!ti2e#$

CASH PLANNING Ca#h "'!/# are in#e(arab'e (art# !" the bu#ine## !(erati!n# !" "irm#$ A "irm need# a#h t! in2e#t in in2ent!ry, re ei2ab'e and "i6ed a##et# and t! ma0e (ayment "!r !(eratin) e6(en#e# in !rder t! maintain )r!/th in #a'e# and earnin)#$ It i# (!##ib'e that "irm may be ma0in) ade1uate (r!"it#, but may #u""er "r!m the #h!rta)e !" a#h a# it# )r!/in) need# may be !n#umin) a#h 2ery "a#t$ The J(!!r a#hE (!#iti!n !" the "irm a#h i# !rre ted i" it# a#h need# are ('anned in ad2an e$ At time#, a "irm an ha2e e6 e## a#h may remain id'e$ A)ain, #u h e6 e## a#h !ut"'!/#$ Su h e6 e## a#h "'!/# an be anti i(ated and (r!(er'y in2e#ted i" a#h ('annin) i# re#!rted t!$ Ca#h ('annin) i# a te hni1ue t! ('an and !ntr!' the u#e !" a#h$ It he'(# t! anti i(ate the "uture a#h "'!/# and need# !" the "irm and redu e# the (!##ibi'ity !" id'e a#h ba'an e# F /hi h '!/er# "irmE# (r!"itabi'ity G and a#h de"i it# F/hi h an au#e the "irmE# "ai'ureG$

Ca#h ('annin) (r!te t# the "inan ia' !nditi!n !" the "irm by de2e'!(in) a (r!.e ted a#h #tatement "r!m a "!re a#t !" e6(e ted a#h in"'!/# and !ut"'!/# "!r a )i2en (eri!d$ The "!re a#t# may be ba#ed !n the (re#ent !(erati!n# !r the anti i(ated "uture !(erati!n#$ Ca#h ('an# are 2ery ru ia' in de2e'!(in) the !2era'' !(eratin) ('an# !" the "irm$ Ca#h ('annin) may be d!ne !n dai'y, /ee0'y !r m!nth'y ba#i#$ The (eri!d and "re1uen y !" a#h ('annin) )enera''y de(end# u(!n the #i9e !" the "irm and (hi'!#!(hy !" mana)ement$ Lar)e "irm# (re(are dai'y and /ee0'y "!re a#t#$ Medium*#i9e "irm# u#ua''y (re(are /ee0'y and m!nth'y "!re a#t#$ Sma'' "irm# may n!t (re(are "!rma' a#h "!re a#t# be au#e !" the n!n*a2ai'abi'ity !" in"!rmati!n and #ma''*# a'e !(erati!n#$ %ut, i" the #ma'' "irm# (re(are a#h (r!.e ti!n#, it i# d!ne !n m!nth'y ba#i#$ A# a "irm )r!/# and bu#ine## !(erati!n# be !me !m('e6, a#h ('annin) be !me# ine2itab'e "!r it# !ntinuin) #u e##$

OTHER FACTORS THAT AFFECT THE SI>E OF CASH BALANCE

<. A:(9*()9*9/; ,. '0,&/?/+&- 7&+@9/I T! a2!id h!'din) unne e##ary 'ar)e ba'an e# !" a#h, m!#t "irm# attem(t t! ma0e arran)ement# at b!rr!/ m!ney i# a#e !" une6(e ted need#$ 8ith #u h an a)reement, the "irm n!rma''y (ay# intere#t !n'y durin) the (eri!d that the m!ney i# a tua''y u#ed$ +$ M,5+; -(&A+/ &(/+'I I" m!ney /i'' brin) a '!/ return a "irm may h!!#e n!t t! in2e#t it$ Sin e the '!## !r (r!"it i# #ma'', it may n!t be /!rth the tr!ub'e t! ma0e the '!an$ On the !ther hand, i" intere#t rate# are 2ery hi)h, e2ery e6tra ru(ee /i'' be in2e#ted$ >$ V(&9(/9,5 95 7('0 .*,='I S!me "irm# e6(erien e /ide "'u tuati!n in a#h "'!/# a# a r!utine matter$ A "irm /ith #teady a#h "'!/# an maintain a "air'y uni"!rm a#h ba'an e$

?$ C,-<+5'(/951 )(*(57+I I" a "irm ha# b!rr!/ed m!ney "r!m a ban0, the '!an a)reement may re1uire the "irm t! maintain a minimum ba'an e !" a#h in it# a !unt#$ Thi# i# a''ed !m(en#atin) ba'an e$ In

e""e t thi# re1uire# the "irm t! u#e the #er2i e# !" ban0 a )uaranteed de(!#it !n /hi h it (ay# n! intere#t$ The intere#t "ree de(!#it i# the ban0E# !m(en#ati!n "!r it# ad2i e and a##i#tan e$

CASH MANAGEMENT B BASIS STRATEGIES

The mana)ement #h!u'd, a"ter 0n!/in) the a#h (!#iti!n by mean# !" the a#h bud)et, /!r0 !ut the ba#i #trate)ie# t! be em('!yed t! mana)e it# a#h$

CASH CYCLE:
The a#h y 'e re"er# t! the (r! e## by /hi h a#h i# u#ed t! (ur ha#e materia'# "r!m /hi h are (r!du ed )!!d#, /hi h are them #!'d t! u#t!mer#$ Ca#h y 'eKA2era)e a)e !" "irmE# in2ent!ry LDay# t! !''e t it# a !unt# re ei2ab'e# *Day# t! (ay it# a !unt# (ayab'e$ The a#h turn!2er mean# the number# !" time# "irmE# a#h i# u#ed durin) ea h year$ >A, Ca#h turn!2er K **************** Ca#h y 'e The hi)her the a#h turn!2er, the 'e## a#h the "irm re1uire#$ The "irm #h!u'd, there"!re, try t! ma6imi9e the a#h turn$

MANAGING COLLECTIONS:
aG P&,-</ B9**951: %y (re(arin) and #endin) the bi''# (r!m(t'y, /ith!ut a time '!) bet/een the di#(at h !" )!!d# and #endin) the bi''#, a "irm an en#ure ear'ier remittan e$

bG E6<+@9/9,8' 7,**+7/9,5 ,. 70+C8+'I

An im(!rtant a#(e t !" e""i ient a#h mana)ement i# t! (r! e## the he1ue# re ei2e# 2ery (r!m(t'y$ G C,57+5/&(/9,5 B(5A951I In#tead !" a #in)'e !''e ti!n enter '! ated at the !m(any head1uarter#, mu'ti('e !''e ti!n enter# are e#tab'i#hed$ The (ur(!#e i# t! #h!rten the (eri!d bet/een the time u#t!mer# mai' in their (ayment# and the time /hen the !m(any ha# u#e !" the "und# are then t! a !n entrati!n ban0 3 u#ua''y a di#bur#ement a !unt$ dG L,7A?B,6 S;'/+-I 8ith !n entrati!n ban0in), a !''e ti!n enter re ei2e# remittan e#, (r! e##e# them and de(!#it# them in a ban0$ The (ur(!#e i# t! '! 0*b!6 #y#tem i# t! e'iminate the time bet/een the re ei(t !" remittan e# by the !m(any and their de(!#it in the ban0$ The !m(any rent# a '! a' (!#t !""i e b!6 and auth!ri9e# it# ban0 in ea h !" the#e itie# t! (i 0 u( remittan e# in the b!6$ The ban0 (i 0# u( the mai' #e2era' time# a day and de(!#it# the he1ue in the !m(anyE# a !unt#$ The he1ue# are re !rded and 'eared "!r !''e ti!n$ The !m(any re ei2e# a de(!#it# the he1ue in the !m(anyE# a !unt#$ The he1ue# are re !rded and 'eared "!r !''ati!n$ The !m(any re ei2e# a de(!#it #'i( and a 'i"t !" (ayment#$ Thi# (r! edure "ree# the !m(any "r!m hand'in) a de(!#itin) the he1ue#$

CONTROL OF DISBURSMENT
(D S/&+/70951 A77,85/' P(;()*+ A "irm #h!u'd (ay it# a !unt# (ayab'e# a# 'ate a# (!##ib'e /ith!ut dama)in) it# redit #tandin)$ It #h!u'd, h!/e2er, ta0e ad2anta)e# !" the a#h di# !unt a2ai'ab'e !n (r!m(t (ayment$

)D C+5/&(*9E+@ D9')8&'+-+5/

One (r! edure "!r ri)ht'y !ntr!''in) di#bur#ement# i# t! enrea'i#e (ayab'e# in t! a #in)'e a !unt, (re#umab'y at the !m(anyE# head1uarter#$ Su h an arran)ement /!u'd enab'e a "irm t! de'ay (ayment# and an #er2e a#h "!r #e2era' rea#!n#$ &ir#t'y, it in rea#e# tran#it time$ Se !nd'y, i" a "irm ha# a entra'i9ed ban0 a !unt, a re'ati2e'y #ma''er t!ta' a#h ba'an e# /i'' be needed$ 7D B(5A D&(./ Un'i0e an !rdinary he1ue, the dra"t i# n!t (ayab'e !n demand$ 8hen it i# (re#ented t! the i##uerE# ban0 "!r !''e ti!n, the ban0 mu#t (re#ent it t! the i##uer "!r a e(tan e$ The "und# then are de(!#ited by the i##uin) "irm t! !2er (ayment# !" the dra"t$ %ut #u(('ier# (re"er he1ue#$ A'#!, ban0 im(!#e# a hi)her #er2i e har)e t! (r! e## them #in e they re1uire #(e ia' attenti!n, u#ua''y manua'$ @D P*(;951 /0+ .*,(/ The am!unt !" he1ue# i##ued by the "irm but n!t (aid "!r by the ban0 i# re"erred t! a# the H(ayment "'!atM$ The di""eren e# bet/een H(ayment "'!atM and H !''e ti!n "'!atM are the net "'!at$ S!, i" a "irm en.!y# a (!#iti2e Hnet "'!atM, it may i##ue he1ue# e2en i" it mean# ha2in) an e2er dr!/n a !unt in it# b!!0#$ Su h an a ti!n i# re"erred t! a# H('ayin) the "'!atM, /ithin 'imit# a "irm an ('ay thi# )ame rea#!nab'y #a"e'y$ Thu# mana)ement !" a#h be !me# e##entia' and it #h!u'd be #een t!, that neither e6 e##i2e n!r inade1uate a#h ba'an e# are maintained$

CASH FLOF ANALYSIS

The a#h "'!/ ana'y#i# i# d!ne /ith the he'( !" a#h "'!/ #tatement$ A a#h "'!/ #tatement i# a #tatement de(i tin) han)e# in a#h (!#iti!n "r!m !ne (eri!d t! an!ther$ It i# an im(!rtant ('annin) t!!'$ Ca#h "'!/ #tatement )i2e# a 'ear (i ture !" the #!ur e !" a#h, the u#e# !" a#h and the net han)e# in a#h$ The (rimary (ur(!#e !" a#h "'!/ #tatement i# t! #h!/ that a# t! /here "r!m the a#h t! be a 1uired and /here t! u#e them$

UTILITY OF CASH FLOF ANALYSIS

A Ca#h "'!/ ana'y#i# i# an im(!rtant "inan ia' t!!' "!r the mana)ement$ It# hie" ad2anta)e# are a# "!''!/#$ 2. H+*<' 95 +..979+5/ 7('0 -(5(1+-+5/ Ca#h "'!/ ana'y#i# he'(# in e2a'uatin) "inan ia' (!'i ie# and a#h (!#iti!n$ Ca#h i# the ba#i# "!r a'' !(erati!n and hen e a (r!.e ted a#h "'!/ #tatement /i'' enab'e the mana)ement t! ('an and !*!rdinate the "inan ia' !(erati!n# (r!(er'y$ The mana)ement an 0n!/ h!/ mu h a#h i# needed "r!m /hi h #!ur e it /i'' be deri2ed, h!/ mu h an be )enerated, h!/ mu h an be uti'i9ed$ 2. H+*<' 95 95/+&5(* .95(579(* -(5(1+-+5/ Ca#h "'!/ ana'y#i# in"!rmati!n ab!ut "und#, /hi h /i'' be a2ai'ab'e "r!m !(erati!n#$ Thi# /i'' he'(# the mana)ement in re(ayment !" '!n)*term debt, di2idend (!'i ie# et $, 3. D9'7*,'+' /0+ -,:+-+5/' ,. C('0 Ca#h "'!/ #tatement di# '!#e# the !m('ete (i ture !" a#h m!2ement$ The in rea#e in and de rea#e !" a#h and the rea#!n# there"!re an be 0n!/n$ It di# '!#e# the rea#!n# "!r '!/ a#h ba'an e in #(ite !" hea2y !(erati!n (r!"it# !n "!r hea2y a#h ba'an e in #(ite !" '!/ (r!"it#$

4. D9'7*,'+' '877+'' ,& .(9*8&+ ,. 7('0 <*(55951

The e6tent !" #u e## !r "ai'ure !" a#h ('annin) be 0n!/n by !m(arin) the (r!.e ted a#h "'!/ #tatement /ith the a tua' a#h "'!/ #tatement and ne e##ary remedia' mea#ure# an be ta0en$

DETERMINE THE OPTIMUM CASH BALANCE

One !" the (rimary re#(!n#ibi'itie# !" the "inan ia' mana)er i# t! maintain a #!und 'i1uidity (!#iti!n !" the "irm #! that the due# are #ett'ed in time$ The "irm need# a#h t! (ur ha#e ra/ materia'# and (ay /a)e# and !ther e6(en#e# a# /e'' a# "!r (ayin) di2idend, intere#t and ta6e#$ The te#t !" 'i1uidity i# the a2ai'abi'ity !" a#h t! meet the "irmE# !b'i)ati!n# /hen they be !me due$ A "irm maintain# the !(eratin) a#h ba'an e "!r tran#a ti!n (ur(!#e#$ It may a'#! arry additi!na' a#h a# a bu""er !r #a"ety #t! 0$ The am!unt !" a#h ba'an e /i'' de(end !n the ri#0*return trade*!""$ I" the "irm maintain# #ma'' a#h ba'an e, it# 'i1uidity (!#iti!n /ea0en#, but it# (r!"itabi'ity im(r!2e# a# the re'ea#ed "und# an be in2e#ted in (r!"itab'e !((!rtunitie# Fmar0etab'e #e uritie#G$ 8hen the "irm need# a#h, it an #e'' it# 0ee(# hi)h a#h ba'an e, it /i'' ha2e a #tr!n) 'i1uidity (!#iti!n but it# (r!"itabi'ity /i'' be '!/$ The (!tentia' (r!"it "!re)!ne !n h!'din) 'ar)e a#h ba'an e i# an !((!rtunity !#t t! the "irm$ The "irm #h!u'd maintain !(timum 3 .u#t t! en!u)h, neither t!! mu h n!r t!! 'itt'e 3 a#h ba'an e$ H!/ t! determine the !(timum a#h ba'an e i" a#h "'!/# are (redi tab'e and i" they are n!t (redi tab'e$

O</9-8- 7('0 )(*(57+ 85@+& 7+&/(95/; BAUMOL4S MODEL

The %aum!' m!de' !" a#h mana)ement (r!2ide# a "!rma' a((r!a h "!r determinin) a "irmE# !(timum a#h ba'an e under ertainty$ It !n#ider# a#h mana)ement #imi'ar t! an in2ent!ry mana)ement (r!b'em$ A# #u h, the "irm attem(t# t! minimi9e the #um !" the !#t !" h!'din) a#h Fin2ent!ry !" a#hG and the !#t !" !n2ertin) mar0etab'e #e uritie# t! a#h$

The baum!'E# m!de' ma0e# the "!''!/in) a##um(ti!n#I The "irm i# ab'e t! "!re a#t it# a#h need# /ith ertainty$

The "irmE# a#h (ayment# ! ur uni"!rm'y !2er a (eri!d !" time$ The !((!rtunity !#t !" h!'din) a#h i# 0n!/n and it d!e# n!t han)e !2er time$ The "irm /i'' in ur the "irm #e''# #e uritie# and #tart# /ith a !n2ert# #e uritie# t! a#h$

Ca#h ba'an e

C:+

A2era)e Time , T< T+ T>

%aum!'E# m!de' "!r a#h ba'an e

C!#t trade*!""I %aum!'E# m!de'

O</9-8- C('0 B(*(57+ 85@+& 857+&/(95/;: T0+ M9**+&?O&& M,@+*

The 'imitati!n !" the %aum!' m!de' i# that it d!e# n!t a''!/ the a#h "'!/# t! "'u tuate$ &irm# in (ra ti e d! n!t u#e their a#h ba'an e uni"!rm'y n!r are they ab'e t! (redi t d! n!t u#e their a#h in"'!/# and !ut"'!/#$ The Mi''er*Orr m!de' !2er !me# thi# #h!rt !min) and a''!/# "!r dai'y a#h "'!/ 2ariati!n$ It a##ume# that net a#h "'!/# are n!rma''y di#tributed /ith a 9er! 2a'ue !" mean and a #tandard de2iati!n$ The MO m!de' (r!2ide# "!r t/! !ntr!' 'imit#*the u((er !ntr!' 'imit and the '!/er !ntr!' 'imit a# /e'' a# a return (!int$ I" the "irmE# a#h "'!/# "'u tuate rand!m'y and hit the u((er 'imit, then it buy# #u""i ient mar0etab'e #e uritie# t! !me ba 0 t! a n!rma' 'e2e' !" a#h ba'an e Fthe return (!intG$ Simi'ar'y, /hen the "irmE# a#h "'!/# /ander and hit the '!/er 'imit, it #e''# #u""i ient mar0etab'e #e uritie# t! brin) the a#h ba'an e ba 0 t! the n!rma' 'e2e' Fthe return (!intG

2. The Late t Trend in !orth Ameri"an Ca h #anagement

Ste2e 8i'der, Seni!r 5i e Pre#ident and CPM!r)an Cha#e Trea#ury Ser2i e# 8e#tern Hemi#(here C!r(!rate and &inan ia' In#tituti!n# Sa'e# E6e uti2e

The

Drive

towards

Efficiency,

Transparency,

Standardization and Integration

Fragmentation is a key driver of corporate inefficiency. This has long been the case in the movement of paper checks and related remittance documents within the U.S. payments system, and the flow of goods, trade-related documents and funds within the broader global supply chain. As corporate treasurers pursue end-to-end automation for treasury and supply-chain activities, they understand that to achieve straight-through processing and the subse!uent optimi"ation of working capital globally they must integrate the payment and information components of a transaction. #ased on this drive for efficiency, three interrelated trends are shaping $orth America%s cash management landscape today. First, corporate treasurers and their banks are driving the convergence towards electronic payments to better integrate money and information flows. Second, there is a parallel convergence in international trade towards open account, electronic payment and the automation of information flows, as treasury pushes to integrate the physical and financial supply chains. &n both fronts, solutions are emerging to digiti"e paper wherever it persists. Third, as companies continue to e'pand globally and information and money flows follow treasury is focused on standardi"ing processes and strengthening internal controls. The ob(ective is to create transparency across a range of business activities to manage risk and ensure financial reporting integrity in compliance with Sarbanes&'ley.

2. CASH MANAGEMENT AND CAPITAL BUDGETING PRACTICES

5ir)inia de(artment !" tran#(!rtati!n Ri hm!nd, 5ir)inia$

Our re2ie/ ha# "!und that Tran#(!rtati!n ha# made #i)ni"i ant (r!)re## !r !m('eted m!#t !" the re !mmendati!n# made in !ur +,,+ #(e ia' re(!rt$ C!m('ete im('ementati!n !" the#e han)e# /i'' ta0e at 'ea#t "!ur t! "i2e year#$ O2er the 'a#t t/! year#, Tran#(!rtati!nE# mana)ement ha# #tarted n!t !n'y im('ementin) re !mmendati!n#, but m!re im(!rtant'y be)un im('ementin) a han)e in the !r(!rate and u'tura' #tru ture !" the !r)ani9ati!n$ The #u e## !" han)e /ith Tran#(!rtati!n /i'' de(end !n /hether a true #tru tura' han)e in !r)ani9ati!n ta0e# ('a e$ The mea#ure !" #u e## /i'' re1uire a #ub#tantia' '!n)*term !mmitment by mana)ement t! n!t !n'y ma0in) the han)e, but t! (re2ent ba 0#'idin) int! Tran#(!rtati!nE# !'d a((r!a he#$

In #!me /ay#, the a !m('i#hment# t! date are the ea#y (art !" han)e$ The harder (art 'ay# ahead in "undin) and im('ementin) ne/ #y#tem#, !ntinuin) t! ma0e the han)e# t! )et '!#er t! a(ita' bud)etin) (r! e##, and !2er !min) Tran#(!rtati!nE# !r(!rate and u'tura' #tru ture t! im(r!2e (r!.e t mana)ement$ The #u e## !" thi# e""!rt i# hi)h'y de(endent !n mana)ement )uidan e and dire ti!n, and urrent mana)ement ha# dem!n#trated their dedi ati!n t!/ard# thi# e""!rt$ I" any mana)ement han)e ! ur#, it i# e##entia' that they ha2e the #ame !mmitmentD !ther/i#e, (r!)re## may be ne)ati2e'y im(a ted$ Tran#(!rtati!n i# re#t!rin) "i# a' a !untabi'ity by im('ementin) #e2era' bud)etary and "inan ia' han)e#, in 'udin) ad!(tin) a debt mana)ement (!'i y and m!de'$ Additi!na''y, they are e#tab'i#hin) a meth!d!'!)y t! identi"y #tate/ide tran#(!rtati!n (ri!ritie# and de2e'!(in) (r!.e t mana)ement (!'i ie#$ Tran#(!rtati!n ha# !m('eted #e2era' bud)etary and "inan ia' han)e#, in 'udin) attem(t# t! ma0e the Si6*Year Im(r!2ement Pr!)ram a rea'i#ti mana)ement t!!' and redu e the (r!.e t# /ith a de"i it #tatu#$ H!/e2er, t! en#ure a urate mat hin) !n a#h in"'!/# and !ut"'!/#, Tran#(!rtati!n mu#t be)in e#timatin) the !#t !" (r!.e t# by "i# a' year$ Tran#(!rtati!n d!e# n!t urrent'y ha2e #u""i ient !ntr!'# and (r! e##e# in ('a e t! mana)e the rate at /hi h they #(end "und#$ &!r ma.!r (r!.e t#, Tran#(!rtati!n ha# be)un a##i)nin) a (r!.e t mana)ement team that "!''!/# a (r!.e t "r!m it# in e(ti!n t! it# !m('eti!n$ H!/e2er, it i# #ti'' t!! ear'y in the (r! e## t! determine i" the (!'i ie# (ut int! ('a e /i'' (r!2ide Tran#(!rtati!n /ith better (r!.e t mana)ement$ H!/e2er, the a ti!n# t! date are th!#e !n#idered be#t (ra ti e# in b!th the (ri2ate and (ub'i "!r 'ar)e !r)ani9ati!n#$ Maintenan e i# #ti'' an area !" !n ern at Tran#(!rtati!n$ The )r!/in) maintenan e

re1uirement# and the 'imited abi'ity t! bud)et !n a need#*ba#ed a((r!a h in rea#e# the ri#0 !" ina((r!(riate'y a(('ied "undin)$ On e the a##et mana)ement #y#tem i# "u''y im('emented a need#*ba#ed a((r!a h /i'' be (!##ib'e and Tran#(!rtati!n /i'' be ab'e identi"y and (ri!riti9e maintenan e (r!.e t#$

3. M'. K(/0+&95+ M. L(5@-(55 C,5/&,**+& F('0951/,5 U59:+&'9/; 95 S/. L,89' C(-<8'.

Thi# "ina' re(!rt (re#ent# the re#u't# !" !ur audit !" the a#h mana)ement (r! edure# u#ed by 8a#hin)t!n Uni2er#ity in St$ L!ui# FUni2er#ityG t! !ntr!' the "und# (aid by the Payment Mana)ement Sy#tem FPMSG durin) the three year# ended Cune >,, +,,,$ 8e "!und that the Uni2er#ity did n!t ha2e ade1uate (!'i ie# and (r! edure# in ('a e t! m!nit!r dai'y a#h ba'an e# and t! (re i#e'y a' u'ate intere#t earned !n (!#iti2e dai'y a#h ba'an e#$ In m!nit!rin) the dai'y a#h ba'an e#, the Uni2er#ity did n!t !n#ider F<G !ut#tandin) he 0# and F+G !2erhead !#t# a# in urred$ In additi!n, the Uni2er#ity did n!t u#e the a((r!(riate intere#t rate# /hen a' u'atin) the intere#t remitted t! the &edera' )!2ernment$ 8e determined that the am!unt !" e6 e## intere#t remitted by the Uni2er#ity /a# !m(arab'e t! the am!unt !" intere#t that #h!u'd ha2e been remitted i" a((r!(riate (r! edure# had been u#ed$ 8e be'ie2e that thi# ! urren e /a# a !in iden e due t! !"" #ettin) "a t!r# in the Uni2er#ityE# a' u'ati!n !" the am!unt t! be remitted$ 8e are re !mmendin) that the Uni2er#ity re2i#e it# /ritten (!'i ie# and (r! edure# t! e""e ti2e'y m!nit!r the dai'y a#h ba'an e and t! a urate'y !m(ute the &edera' remittan e$

8e made "!ur #(e i"i re !mmendati!n# "!r im(r!2in) the Uni2er#ityE# a#h mana)ement (r! edure#$ The Uni2er#ity !n urred /ith t/! and i# #ti'' e2a'uatin) the third$ H!/e2er, they did n!t a e(t !ur "!urth re !mmendati!n$ The Uni2er#ityE# re#(!n#e i# in 'uded in it# entirety a# A((endi6 A$

?$

C('0 M(5(1+-+5/ ); E59@ B+:+&*; J,5+'

It i# a Financial Overview for School Administrators i# a #u in t !2er2ie/ !" (ub'i

# h!!' "inan e, (re#entin) !n e(t# !" im(!rtan e t! b!th #ite*ba#ed and entra'*!""i e 'eader#$ A (ra)mati b'end !" the!reti a' !n e(t# and "a tua' in"!rmati!n (r!2ide# reader# /ith an e6 e''ent #yn!(#i# !" (ub'i # h!!' "inan e$
The economics and politics of education are discussed in the conte't of human capital and the role of public education in the United States as an investment in human capital. Author )nid *ones, who is an associate professor of school finance at Fayetteville State University, stresses the importance of investment in human capital and its necessity for an educated, productive workforce. The chapter on ade!uacy and e!uity provides an understanding of the two concepts so fre!uently debated in school finance. As more states struggle with funding issues, this sub(ect matter is timely and useful. +ash ,anagement seems intended for use nationwide with information on basic school business procedures, including budgeting and financing of school facilities. The use of lay terminology and relevant e'amples make the book valuable both in graduate school classes on educational leadership and in the hands of practicing administrators.

FCa#h Mana)ementI A &inan ia' O2er2ie/ "!r S h!!' Admini#trat!r# , by Enid %e2er'ey C!ne#, S are r!/ Pre##, Lanham, Md$, +,,<G

CHAPTER III

OBJECTIVES OF THE STUDY P&9-(&; O)G+7/9:+:

T! ana'y9e the a#h mana)ement !" Standard P!'ymer# $

S+7,5@(&; O)G+7/9:+:
T! "ind !ut the 'i1uidity (!#iti!n !" the !n ern thr!u)h rati! ana'y#i#$ T! #tudy the )r!/th !" #tandard (!'ymer# in term# !" a#h "'!/ #tatement$ T! ma0e #u))e#ti!n and re !mmendati!n t! im(r!2e the a#h (!#iti!n !" #tandard (!'ymer#.

CHAPTER*I5 RESEARCH METHODOLOGY

4.1 RESEARCH
Re#ear h i# a (r! e## in /hi h the re#ear her# /i#h t! "ind !ut the end re#u't "!r a )i2en (r!b'em and thu# the #!'uti!n he'(# in "uture !ur#e !" a ti!n$ The re#ear h ha# been de"ined a# HA are"u' in2e#ti)ati!n !r en1uiry e#(e ia''y thr!u)h #ear h "!r ne/ "a t# in bran h !" 0n!/'ed)eM

4.2 RESEARCH DESIGN

The re#ear h de#i)n u#ed in thi# (r!.e t i# Ana'yti a' in nature the (r! edure u#in), /hi h re#ear her ha# t! u#e "a t# !r in"!rmati!n a'ready a2ai'ab'e, and ana'y9e the#e t! ma0e a riti a' e2a'uati!n !" the (er"!rman e$

4.3 DATA COLLECTION

Primar$ %our"e <$ Data are !''e ted thr!u)h (er#!na' inter2ie/# and di# u##i!n /ith &inan e* E6e uti2e$ +$ Data are !''e ted thr!u)h (er#!na' inter2ie/# and di# u##i!n /ith Materia' P'annin)* De(uty Mana)er$ Secondary Source <$ &r!m the annua' re(!rt# maintained by the !m(any$ +$ Data are !''e ted "r!m the !m(anyE# /eb#ite$ >$ %!!0# and .!urna'# (ertainin) t! the t!(i $

4.4 TOOLS USED IN THE ANALYSIS Ca#h "'!/ #tatement Trend ana'y#i# Rati! ana'y#i#$

4.H P+&9,@ ,. '/8@;

The (re#ent #tudy ha# ta0en int! a !unt &i2e year# 2i9$, +,,+*+,,> t! +,,A*+,,-$

CHAPTER V

DATA ANALYSIS I INTERPRETATION

H.2 CALCULATIONS OF FUNDS FROM OPERATION AND CASH FROM OPERATION FOR THE YEAR ENDED JR' 95 T0,8'(5@D
P(&/978*(&' Net Pr!"it De(re iati!n durin) the year FFOJFLOD ADDI Sundry debt!r# Pre(aid E6(en#e# Sundry redit!r# Out#tandin) 'iabi'itie# %an0 O:D LESSI St! 0 %an0 O:D Out#tandin) 'iabi'itie# Sundry Debt!r# Sundry Credit!r# CFOJCLOD =4;?++= >?+=A> <;<A,+, <?=-A>? ;A-,-> +=;,?A? -A-<>< =;A+>=> >>?+?? =<,-?A <A==>;? 4=;,-=<-;;;-A <<,A=<> ->A+=+ ?>+,, ?-><<>, <,,=;>? +=;,?A? <-<,+<, <,A?>+,> =<4?< <,4,<>;> +=>=A+ <44<+?> +A+>?;= +,=4=?; ++,,-,< 2003?2004 A+<,4+ <+A,<A< 2004?200H <<4>+-; <??,<4? 200H?200K ?-4->4 <A+,+,200K?2007 ?,,?-, <4,,+><

H.2 CASH FLOF STATEMENT

I5.*,= O(enin) ba'an e Ca#h "r!m !(erati!n In rea#e in '!an "und# Sa'e# !" A##et In rea#e a(ita' T,/(* O8/.*,=' Ca#h !ut"'!/ "r!m !(erati!n Pur ha#e !" A##et De rea#e "und# De rea#e in in =--A?<< '!an +--,? #hare A?A-4 =4A4-=> =,,>?, +,,,,, <,?;?; <+,?44; A>;4+ A4><>A> +-4?<, =,<?>-= A-A--4< -,,?4+; <-><<?? in #hare =4A4-=> <+,?44; -=-+?? +4,,,,, A4><>A> =,<?>-= +,,>*+,,? <?;A? =4;?++= +,,?*+,,; A?A-4 >?+=A> +,,;*+,,A <,?;?; <;<A,+, +?<,-=4 +,,A*+,,A>;4+ 4=;,-=-

a(ita' C'!#in) ba'an e T,/(*

I5.+&+57+:
Thi# tab'e #h!/# that the a#h "'!/ #tatement# !" STANDARD POLYMERS are t! be e""i ient$ The a#h in"'!/ !" the !m(any i# t! be in rea#ed "!r year a"ter year$ The "und "r!m !(erati!n i# a'#! t! di""er "r!m e2ery year$ The !m(any #h!u'd in rea#e their #hare a(ita' "r!m +,,A*+,,- "!r R#$ +4, ,,,,,,$ It# mu#t be u#ed a# e""i ient "!r the ne6t year "!r de rea#e their '!an am!unt$

H.3 TREND ANALYSIS Y K a L bN

8here

a K OY n

b K ONY ON+

H.3.2 INVENTORIES
I5:+5/,&9+' YEAR E,+ 3 J,> E,> 3 J,? E,? 3 J,; E,;3 J,A E,A 3 J,TOTAL a % *+ *< , < + %2 ? < , < ? <, K <, ?+, ,=,<,4 ; b K A<, 4A,;,; <, K A, <4,A;,$; JR' 95 *(A0'D Y +-,-A,,-+ <+,-4,?>4 <4,?;,;<< >A,,<,,4?-,,4,,,, <,?+,,=,<,4 K %Y JR' 95 *(A0'D *;;,;+,<?? *<+,-4,?>4 , >A,,<,,4=?,<A,,,, A<,4A,;,;

+, 4?,<4+$A

I5.+&+57+:
Thi# tab'e indi ate# that the 2!'ume !" in2ent!ry ha# been in rea#ed e2ery year$ It# mu#t be in rea#ed "!r the 'a#t year <<, ,A,=<>$ In2ent!rie# 2a'ue in +,,4 /i'' be ab!ut

+<, ?,,<>?$<

H.3.2 SUNDRY DEBTORS

S85@&; YEAR % %2 D+)/,&' JR'D E,+ 3 J,> E,> 3 J,? E,? 3 J,; E,; 3 J,A E,A 3 J,TOTAL *+ *< , < + ? < , < ? <, Y +,,A=,;<> +4,,;,4,; +;,<<,4?+ <,+,,-?,+>A <,+=,4?,=4+ >,+?,?A,>-4 %Y JR'D *?<,>=,,+A *+4,,;,4,; , <,+,,-?,+>A +,;=,A=,=A? >,<,,==,>A=

a K

>, +?, ?A,>-4 ;

A?, 4=,+-;$A

K >, <,, ==,>A= <,

><, ,=,=>A$=

I5.+&+57+:
Thi# tab'e #h!/# that the Sundry Debt!r# ha# been m!re e2ery year$ It mu#t be in rea#ed m!re than A time# "r!m the be)innin) !" the (eri!d !" the #tudy$ Sundry Debt!r#

2a'ue in +,,4 /i'' be ab!ut <, ;4, <=,,4A$>$

H.3.3 CASH 3 BANK

C('0 3 B(5A YEAR E,+3 J,> E,> 3 J,? E,? 3 J,; E,; 3 J,A E,A 3 J,% *+ *< , < + %2 ? < , < ? JR'D Y <?,;A? A?,A-= A<,4;4 A>,;4+ +,-4,?<, %Y JR'D *+=,<+4 *A?,A-= , A>,;4+ ;,;A,4+,

TOTAL

<,

?,4>,,=>

;,+A,;=>

?, 4>,,=> ;

=A,A<4$A

;, +A,;=> <,

;+,A;=$>

I5.+&+57+:
The a#h 2a'ue !" the STANDARD POLYMERS ha# been in rea#ed and the e#timated it #h!u'd be de rea#ed "!r the (re2i!u# year$ Ca#h 2a'ue in +,,4 /i'' be ab!ut

+;?;=A$;$

H.3.4 LOANS I ADVANCES

L,(5' YEAR % %2 A@:(57+' JR'D E,+ 3 J,> E,> 3 J,? E,? 3 J,; E,; 3 J,A E,A 3 J,TOTAL *+ *< , < + ? < , < ? <, Y <,,,,,A; 4,+A,>->,A,,<>4 +-,-,,=>;,A+,4>?A,+,,>;? I %Y JR'D *+,,,,<>, *4,+A,>-, +-,-,,=><<,+;,A-? +4,-,,<,?

?A, +,,>;?

=, +?,,-,$4

; b K +4, -,,<,? <, K +, 4-,,<,$?

I5.+&+57+:
The tab'e indi ate# that the '!an# and ad2an e# !" STANDARD POLYMERS /i'' be redu ed "r!m the year +,,A*+,,-$ L!an# @ Ad2an e# 2a'ue in +,,4 /i'' be ab!ut

<-, 4;,<,+$

H.3.H CURRENT LIABILITIES

C8&&+5/ YEAR % %2 L9()9*9/9+' JR'D E,+ 3 J,> E,> 3 J,? E,? 3 J,; E,; 3 J,A E,A 3 J,TOTAL *+ *< , < + ? < , < ? <, Y ++,;4,;-A ;-,?;,??+ >4,;A,>>4 <,??,->,<,+ <,+;,44,+,> >,4=,+<,AA< %Y JR'D *?;,<-,<;+ *;-,?;,??+ , <,??,->,<,+ +,;<,-A,?,A +,=>,4A,=<?

>, 4=, +<,AA< ;

--, 4?,>>+$+

+, =>, 4A,=<?

+=, >4,A=<$?

<,

I5.+&+57+:
The tab'e #h!/# that the !m(anyE# urrent 'iabi'ity /i'' be in rea#ed "r!m the e2ery year$

Current Liabi'itie# 2a'ue in +,,4 /i'' be ab!ut <, AA, ,,,?,A$?$

H.3.K CURRENT ASSET

C8&&+5/ (''+/ % YEAR E,+ 3 J,> E,> 3 J,? E,? 3 J,; E,; 3 J,A E,A 3 J,TOTAL *+ *< , < + %2 ? < , < ? <, JR'D Y +<,+-,+-?<,?4,=+< ;=,-?,=>> <,4;,,=,4?+ +,,>,;,,+?, ;,<<,<<,+<> %Y JR'D *?+,;?,;;? *?<,?4,=+< , <,4;,,=,4?+ ?,,-,,,,?4, ;,,4,,A,=?-

;,<<,<<,+<> ;

<,,+,++,+?+$A

;,,4,,A,=?<,

;,,4,,A=?$-

I5.+&+57+:
Thi# tab'e #h!/# that the urrent a##et !" the !m(any /i'' be )r!/n at =time#$ 8hen !m(ared t! the be)innin) !" the (eri!d !" #tudy it# mu#t be in rea#ed$ Current A##et 2a'ue in +,,4 /i'' be ab!ut +, ;?,A?,>+A$-$

RATIO ANALYSIS:
Rati! Ana'y#i# i# a (!/er"u' t!!' !" "inan ia' ana'y#i#$ A Rati! i# de"ined a# Hthe indi ated 1u!tient !" t/! mathemati a' e6(re##i!n#M and a# Hthe re'ati!n#hi( bet/een t/! !r m!re thin)#M$ In "inan ia' ana'y#i#, a rati! i# u#ed a# a ben hmar0 "!r e2a'uatin) the "inan ia' (!#iti!n and (er"!rman e !" a "irm$

Rati! he'(# t! #ummari9e 'ar)e 1uantitie# !" "inan ia' data and t! ma0e 1ua'itati2e .ud)ment ab!ut the "irmE# "inan ia' (er"!rman e$

H.4 RATIO ANALYSIS H.4.2 C8&&+5/ A''+/' /, F96+@ A''+/' R(/9,

The "!rmu'a "!r the rati! i#

Current A##et# &i6ed A##et#

C8&&+5/ A''+/' /, F96+@ A''+/' R(/9,

I57&+('+3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,$ I5.+&+57+: The 'e2e' !" Current A##et# an be mea#ured by u#in) thi# Current A##et t! &i6ed A##et# Rati!$ The 'e2e' ha# been "'u tuatin) e2ery year$ RATIO ,$=?I< ,$-+I< <$;;I< <$+4I< <$A+I< D+7&+('+ *,$++ ,$4+ *,$+,$>?

1.# 1." 1.4 1.2 1 !.# !." !.4 !.2 ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!'

Curren( A Ra()o

e( (o F)*ed A

e(

H.4.2 C8&&+5/ A''+/' /, T,/(* A''+/' R(/9,

The "!rmu'a "!r the rati! i#

Current A##et# T!ta' A##et#

C8&&+5/ A''+/' /, T,/(* A''+/' R(/9,

I57&+('+3 YEAR +,,+ * ,> +,,> * ,? +,,? * ,; +,,; * ,A +,,A * ,RATIO ,$+AI< ,$?4I< ,$A+I< ,$;=I< ,$;=I< D+7&+('+ ,$++ ,$<? *,$,>

I5.+&+57+:
The Tab'e #h!/# the Current A##et# t! T!ta' A##et# rati! !" the !m(any, /hi h re)i#tered a "'u tuatin) trend thr!u)h!ut the #tudy (eri!d$ Thi# rati! 2aried "r!m ,$+A t! ,$?4 time# durin) the #tudy$ There i# n! han)e "!r 'a#t year$

!.' !." !.& !.4 !.3 !.2 !.1 ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' Curren( A e( (o To(a+ A e( Ra()o

H.4.3 N+/ F,&A951 C(<9/(* R(/9,

The "!rmu'a "!r the rati! i# Net 8!r0in) Ca(ita' Net A##et#

N+/ F,&A951 C(<9/(* R(/9,

I57&+('+3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$+-I< ,$<+I< ,$<;I< ,$+<I< ,$++I< D+7&+('+ * ,$<; ,$,> ,$,A ,$,<

I5.+&+57+:
Net 8!r0in) Ca(ita' i# u#ed a# a mea#ure !" a "irmE# 'i1uidity and the "irmE# (!tentia' re#er2!ir !" "und#$ It an a'#! be re'ate t! net a##et#$ The Net 8!r0in) Ca(ita' Rati! "r!m the tab'e #h!/# a "'u tuatin) trend and the a2era)e Net 8!r0in) Ca(ita' Rati! i# ,$+< time# !" Net 8!r0in) Ca(ita' t! Net A##et#$ Hen e it #h!/# that STANDARD POLYMERS ha# an a2era)e 'i1uidity (!#iti!n$

!.3 !.2& !.2 !.1& !.1 !.!& ! $!2%$!3 $!3%$!4 !4%$!& $!&%$!" $!"%$!' Ne( ,or-)n. Ca/)(a+ Ra()o

H.3.4 I5:+5/,&9+' /, C8&&+5/ A''+/' R(/9,

The "!rmu'a "!r the rati! i# In2ent!rie# Current A##et#

I5:+5/,&9+' /, C8&&+5/ A''+/' R(/9,

I57&+('+3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO <$>,I< ,$><I< ,$><I< ,$<=I< ,$+>I< D+7&+('+ *,$== *,$<+ ,$,?

I5.+&+57+:
&r!m the tab'e it i# 0n!/n that the In2ent!rie# t! Current A##et# Rati! a'#! re)i#ter a "'u tuatin) trend durin) the entire #tudy (eri!d$ The a2era)e rati! i# ,$>< time# and thu# it i# "!und that the in2e#tment in in2ent!rie# Fbein) !ne !" the im(!rtant Current A##et#G i# 0e(t at the !n#iderab'e 'e2e'$

1.4 1.2 1 !.# !." !.4 !.2 ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' In0en(or)e (o Curren( A e( Ra()o

H.4.H S85@&; D+)/,&' /, C8&&+5/ A''+/' R(/9,

The "!rmu'a "!r the rati! i# Sundry Debt!r# Current A##et#

S85@&; D+)/,&' /, C8&&+5/ A''+/' R(/9,

I57&+('+3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$=-I< ,$A4I< ,$?+I< ,$A;I< ,$A>I< D+7&+('+ *,$+= * ,$+A ,$+> *,$,+

I5.+&+57+:
&r!m the tab'e the Sundry Debt!r# t! Current A##et# Rati! #h!/# a "'u tuatin) trend thr!u)h!ut the #tudy (eri!d "r!m +,,+*,> t! +,,A*,-$ The a2era)e rati! i# ,$A; time#$ Hen e it im('ie# the redit (!'i y "!''!/ed by STANDARD POLYMERS i# m!derate$

1 !.# !." !.4 !.2 ! Sundry De1(or (o Curren( A e( Ra()o

$!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!'

H.4.K L,(5' (5@ A@:(57+' /, C8&&+5/ A''+/' R(/9,

The "!rmu'a "!r the rati! i# L!an# and Ad2an e# Current A##et#

L,(5' (5@ A@:(57+' /, C8&&+5/ A''+/' R(/9,

I57&+('+3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$,+I< ,$<=I< ,$,AI< ,$<;I< ,$,+I< D+7&+('+ ,$<*,$<> ,$,= * ,$<>

I5.+&+57+:

&r!m the tab'e it i# n!ted that the L!an# and Ad2an e# t! Current A##et# Rati! ha2e re)i#tered a "'u tuatin) trend$ It im('ie# that a 1uarter (!#iti!n# !" the Current A##et# are 0e(t in "!r L!an# and Ad2an e#D thereby it i# "!und that STANDARD POLYMERS 2a'ue !" L!an# and Ad2an e# i# !n#iderab'e$
!.2 !.1& !.1 !.!& ! Loan 2 Ad0ance (o Curren( A e( Ra()o

$!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!'

H.4.7 C('0 /, C8&&+5/ A''+/' R(/9,

The "!rmu'a "!r the rati! i# Ca#h Current A##et#

C('0 /, C8&&+5/ A''+/' R(/9,

I57&+('+3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$,,AI< ,$,<;I< ,$,<I< ,$,,>I< ,$,<>I< D+7&+('+ ,$,= *,$<? * ,$,,,$,<

I5.+&+57+:
The tab'e #h!/# the detai'# !" Ca#h t! Current A##et# Rati! and re)i#tered a "'u tuatin) trend thr!u)h!ut the #tudy (eri!d "r!m +,,+*,> t! +,,A*,-$ Hen e /e "ind that STANDARD POLYMERS had maintained a m!derate 'e2e' !" a#h in (r!(!rti!n t! Current A##et#$

!.!1" !.!14 !.!12 !.!1 !.!!# !.!!" !.!!4 !.!!2 ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!'

Ca 3 (o Curren( A

e( Ra()o

H.4.8 C('0 /, F,&A951 C(<9/(* R(/9,

The "!rmu'a "!r the rati! i# Ca#h 8!r0in) Ca(ita'

C('0 /, F,&A951 C(<9/(* R(/9,

I57&+('+3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$<<I< ,$,?I< ,$,>I< ,$,-I< ,$,AI< D+7&+('+ * ,$,* ,$,< ,$,? *,$,<

I5.+&+57+:
The Ca#h t! 8!r0in) Ca(ita' Rati! re)i#tered a "'u tuatin) trend durin) the #tudy (eri!d thi# i# n!ted "r!m the tab'e$ It /a# ,$<< time# in +,,?*,;, /hi h #har('y in rea#ed t! ,$,? time# in the ne6t year and 'ater "!r the "!''!/in) year# it i# "'u tuatin)$ Hen e it i# "!und that ?P !" the 8!r0in) Ca(ita' rati! i# mana)ed by u#in) the a#h @ ban0 ba'an e a2ai'ab'e in the !m(any$ The (!'i y re)ard "inan in) the 8!r0in) Ca(ita' in STANDARD POLYMERS an be #aid a# a))re##i2e (!'i y$

!.12 !.1 !.!# !.!" !.!4 !.!2 ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' Ca 3 (o ,or-)n. Ca/)(a+ Ra()o

H.4.L C('0 /, S(*+' R(/9,

The "!rmu'a "!r the rati! i# Ca#h Sa'e#

C('0 /, S(*+' R(/9,

I57&+('+ 3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$,,,-I< ,$,,+AI< ,$,,+4I< ,$,,A=I< ,$,,A?I< D+7&+('+ ,$,,<= ,$,,,+ ,$,,?< * ,$,,,;

I5.+&+57+:
Thi# i# !ne !" the im(!rtant rati!# !" !ntr!''in) a#h$ A #tudy !" a#h t! #a'e# rati! /i'' (r!2ide a dee( in#i)ht int! the a#h ba'an e# he'd in the !n ern#$ E2ident "r!m the tab'e #h!/# Ca#h t! Sa'e# re)i#tered a "'u tuatin) trend thr!u)h!ut the #tudy (eri!d$

!.!!' !.!!" !.!!& !.!!4 !.!!3 !.!!2 !.!!1 ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' Ca 3 (o Sa+e Ra()o

H.4.20 C('0 R(/9,

The "!rmu'a "!r the rati! i# Ca#h Current 'iabi'itie#

C('0 R(/9,
I57&+('+ 3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$,,A?I< ,$,<<+I< ,$,<A,I< ,$,,??I< ,$,++<I< D+7&+('+ ,$,,?4 ,$,,?4 *,$,<<A ,$,<--

I5.+&+57+:
&r!m the tab'e it i# n!ted that the a#h (!#iti!n !" the STANDARD POLYMERS i# #ati#"a t!ry$ It i# "!und that the a#h re1uired t! meet !ut the urrent 'iabi'itie# i# maintained at a n!rma' 'e2e'$

!.!2& !.!2 !.!1& !.!1 !.!!& ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' Ca 3 Ra()o

H.4.22 C8&&+5/ R(/9,

The "!rmu'a "!r the rati! i# Current A##et# Current 'iabi'itie#

C8&&+5/ R(/9,
I57&+('+ 3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$=?I < ,$-+I < <$;;I < <$+-I < <$A+I < D+7&+('+ *,$++ ,$4> *,$+4 ,$>;

I5.+&+57+:
Thi# rati! i# an indi at!r !" the "irmE# !mmitment t! meet it# #h!rt 3 term 'iabi'itie#$ &r!m the tab'e it i# 'ear that the Current Rati! !" STANDARD POLYMERS ha# been "'u tuatin) "r!m the #tartin) !" the #tudy (eri!d, 'ater "!r 'a#t year it ha# been in rea#in)D hen e the Current Rati! i# 1uite #ati#"a t!ry$ Thu# the Current Rati! #h!/# that the !m(any ha# #u""i ient "und# t! meet it# #h!rt* term !b'i)ati!n#$

1.# 1." 1.4 1.2 1 !.# !." !.4 !.2 !

Curren( Ra()o

$!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!'

H.4.22 L9C89@9/; R(/9,

The "!rmu'a "!r the rati! i# Li1uid A##et# Current 'iabi'itie#

L9C89@9/; R(/9,
I57&+('+ 3

I5.+&+57+:

YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,-

RATIO ,$=?I < ,$;,I < <$,-I < <$,>I < <$+?I <

D+7&+('+

*,$?? ,$;*,$,? ,$+<

Thi# rati! he'(# the mana)ement t! mea#ure #h!rt*term #!'2en y$ The idea' 'i1uid rati! i# <I< &r!m the tab'e it i# 'ear that STANDARD POLYMERS 'i1uid rati! i# m!re than the idea' rati! durin) the #tartin) !" the #tudy (eri!d and 'ater in +,,? * ,; it had redu ed #'i)ht'y, yet "!r the re#t !" the (eri!d urrent 'iabi'itie# /ere "u''y #e ured by 'i1uid a##et# be au#e the 'i1uid a##et# /ere m!re than the urrent 'iabi'itie# and hen e the !m(anyE# 'i1uidity i# #ati#"a t!ry$

1.4 1.2 1 !.# !." !.4 !.2 ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' L)4u)d)(y Ra()o

H.4.23 S8<+& M897A R(/9,

The "!rmu'a "!r the rati! i# Su(er Bui 0 A##et# Bui 0 'iabi'itie#

S8<+& M897A R(/9,

I57&+('+ 3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ,$A;I< ,$>+I< ,$;4I< ,$A+I< ,$A?I< D+7&+('+ *,$>> ,$+A ,$,? ,$,+

I5.+&+57+:
Su(er Bui 0 Rati! i# the hea'thy mea#ure !" the "irmE# 'i1uidity (!#iti!n$ &r!m the tab'e ?$+< it i# n!ted that the 'i1uidity !" STANDARD POLYMERS had a #tee( #'!(e in bet/een durin) the year +,,>*,?, yet it /a# ab'e t! ha2e a #'!/ in rea#e in the re#t !" the #tudy (eri!d and ab'e t! maintain it# (!#iti!n$ Hen e it #h!/# that STANDARD POLYMERS i# ab'e t! meet it# urrent !b'i)ati!n# F'iabi'itie#G$

!.' !." !.& !.4 !.3 !.2 !.1 ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' Su/er 5u)c- Ra()o

H.4.24 F,&A951 C(<9/(* T8&5,:+& R(/9,

The "!rmu'a "!r the rati! i# #a'e# 8!r0in) Ca(ita'

F,&A951 C(<9/(* T8&5,:+&

I57&+('+ 3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO <+$>AI < <-$-,I < <<$;;I < ><$;;I < ;$?;I < D+7&+('+ ;$>? *+;$<; +,$,, *+A$<;

I5.+&+57+:
Thi# rati! indi ate# /hether 8!r0in) Ca(ita' ha# been e""e ti2e'y uti'i9ed in ma0in) #a'e# !r n!t$ &r!m the tab'e it i# n!ted that 8!r0in) Ca(ita' had #!me "'u tuati!n in the midd'e !" the #tudy (eri!d, yet the !m(any /a# ab'e t! in rea#e it in the 'ater year#$ Hen e the turn!2er indi ate# that STANDARD POLYMERS had uti'i9ed it# 8!r0in) Ca(ita' e""i ient'y and the !m(any an a'#! try t! /!r0 !n thi# t! )et m!re e""e ti2e 2a'ue#$

3& 3! 2& 2! 1& 1! & ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' ,or-)n. Ca/)(a+ (urno0er Ra()o

H.4.2H I5:+5/,&9+' T8&5,:+& R(/9,

The "!rmu'a "!r the rati! i# C!#t !" G!!d# S!'d A2era)e St! 0

I5:+5/,&9+' T8&5,:+&
YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO <$>AI < <$,+I < <$,+I < <$,+I < <$;>I < I57&+('+ 3 D+7&+('+ *,$>? , , ,$;<

I5.+&+57+:
Thi# rati! indi ate# /hether in2e#tment in in2ent!ry i# e""i ient'y u#ed !r n!t and /hether the in2e#tment i# /ithin (r!(er 'imit#$ &r!m the tab'e it i# "!und that the In2ent!ry turn!2er Rati! !" STANDARD POLYMERS had #!me "'u tuati!n# in the #tartin) !" the #tudy (eri!d then it had a )r!/th in it$ Hen e the e""i ien y !" in2ent!ry !ntr!' in STANDARD POLYMERS #h!/# a #ati#"a t!ry (!#iti!n$

1." 1.4 1.2 1 !.# !." !.4 !.2 !

In0en(or)e (or Ra()o

$!2% $!3

$!3% $!4

$!4% $!&% $!& $!"

$!"% $!'

H.4.2K D+)/,&' T8&5,:+& R(/9,

The "!rmu'a "!r the rati! i# Sa'e# Sundry Debt!r#

D+)/,&' T8&5,:+&
I57&+('+ 3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO -$4?I < 4$;?I < 4$?=I < >$>,I < >$+AI < D+7&+('+ ,$-, *,$,; *;$<= *,$,?

I5.+&+57+:
Thi# i# !ne !" the te hni1ue# em('!yed by the !m(any /ith re)ard t! the !''e ti!n !" the re ei2ab'e# thr!u)h e""e ti2e mana)ement !" !''e ti!n (!'i y /ith the he'( !" "a t!rin) #er2i e#$ &r!m the tab'e it #h!/# that the Debt!r#E turn!2er Rati! had #ati#"a t!ry in rea#e in the #tartin) !" the #tudy (eri!d$ H!/e2er, in midd'e !" the #tudy (eri!d it had #'i)ht "'u tuati!n#, the !m(any /a# ab'e t! rai#e it in the ne6t year$

6 # ' " & 4 3 2 1 !

De1(or (urno0er Ra()o

$!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!'

H.4.27 D+)/ C,**+7/9,5 P+&9,@ R(/9,

The "!rmu'a "!r the rati! i# Day# in a M!nth Sundry Debt!r# turn!2er

D+)/ C,**+7/9,5 P+&9,@ R(/9,

I57&+('+ 3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO ?A$; ?+$4<$+= <<,$A <<<$= D+7&+('+ *>$4 >=$-= +=$>< <$>

I5.+&+57+:
Thi# rati! indi ate# the e6tent t! /hi h the debt# ha2e been !''eted in time$ It )i2e# the a2era)e debt !''e ti!n (eri!d$ STANDARD POLYMERS u#e thi# rati! t! "ind !ut /hether their b!rr!/er# are (ayin) !n time$ &r!m the tab'e it i# "!und that thr!u)h!ut the #tudy (eri!d the !''e ti!n (eri!d i# "'u tuatin) and i# /ithin the a2era)e$

12! 1!! #! "! 4! 2! ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' De1( Co++ec()on 7er)od Ra()o

H.4.28 C('0 I5/+&:(* M+('8&+ R(/9,

The "!rmu'a "!r the rati! i# Current A##et# 3 In2ent!rie# A2)$ Dai'y O(eratin) E6($

C('0 I5/+&:(* M+('8&+ R(/9,

I57&+('+ 3 YEAR +,,+ 3 ,> +,,> 3 ,? +,,? 3 ,; +,,; 3 ,A +,,A 3 ,RATIO <>;$<? <,?$+<>A$?? <??$-+ <?A$<> D+7&+('+ *>,$4= >+$<4$+4 <$?<

I5.+&+57+:
Thi# rati! e6amine# the "irmE# abi'ity t! meet it# re)u'ar a#h e6(en#e#$ The de"en#i2e inter2a' mea#ure# the time (eri!d "!r /hi h a "irm an !(erate !n the ba#i# !" (re#ent 'i1uid a##et# /ith!ut re#!rtin) t! the ne6t yearE# re2enue$ Thi# rati! !" STANDARD POLYMERS, "r!m the tab'e #h!/# that the !m(any an meet it# !(eratin) a#h re1uirement# /ithin a (eri!d !" <,; t! <?A day# /ith!ut re#!rtin) t! ne6t yearE# in !me$

1"! 14! 12! 1!! #! "! 4! 2! ! $!2%$!3 $!3%$!4 $!4%$!& $!&%$!" $!"%$!' De1( Co++ec()on 7er)od Ra()o

CHAPTER VI K.2 FINDINDS

The a#h mana)ement !" STANDARD POLYMER ha# been /!r0in) /e'' in the !r)ani9ati!n$ The &und# "r!m !(erati!n# !" a !m(any ha# been in rea#ed "r!m year by year$ The a#h "r!m !(erati!n# ha# been "ind that it u#ed a# e""i ient$ The a#h in"'!/ and !ut"'!/ !" a#h "'!/ #tatement ha2e a a#h ba'an e /i'' be in rea#ed ?$+ time# /hen !m(ared t! 'a#t year ba'an e$ Current Rati! #h!/# that the !m(any ha# #u""i ient "und# t! meet it# #h!rt*term !b'i)ati!n#$ The !m(anyE# Li1uidity Rati! #h!/# a #ati#"a t!ry trend$ Su(er Bui 0 Rati! #h!/# that STANDARD POLYMER i# ab'e t! meet it# urrent !b'i)ati!n# F'iabi'itie#G$$ The e""i ien y !" in2ent!ry !ntr!' in STANDARD POLYMER #h!/# a #ati#"a t!ry (!#iti!n$$ The Ca#h Rati! #h!/# that the a#h re1uired t! meet !ut the urrent 'iabi'itie# i# maintained at a n!rma' 'e2e' hen e, it #h!/# that STANDARD POLYMER "!''!/# an a2era)e (!'i y$

 Inter2a' Mea#ure Rati! #h!/# that the in !me$

!m(any

an meet it# !(eratin)

a#h

re1uirement# /ithin a (eri!d !" <,; t! <?A day# /ith!ut re#!rtin) t! ne6t yearE# The Current A##et# t! T!ta' A##et# Rati! im('ie# that STANDARD POLYMER i# maintainin) a !n#iderab'e 'e2e' !" Current A##et# in (r!(!rti!n t! T!ta' A##et#$ The a2era)e Ca#h t! Current A##et# i# maintained at ,$,,= time#$ Hen e, it i# "!und that the !m(any had maintained a m!derate 'e2e' !" a#h in (r!(!rti!n t! Current A##et#$ The a2era)e rati! !" In2ent!rie# t! Current A##et# i# ,$?A time# and thu# it i# "!und that the in2e#tment in in2ent!rie#$ The a2era)e rati! !" Sundry Debt!r# t! Current A##et# i# ,$A- time#$ Hen e it im('ie# that the redit (!'i y "!''!/ed by STANDARD POLYMERS i# m!derate$ The '!an# and Ad2an e# t! Current A##et# rati! !" the !m(any im('y that a 1uarter (!#iti!n# !" the Current A##et# are 0e(t in "!r '!an# and ad2an e#, /hi h i# !n#iderab'e$ The (!'i y re)ard "inan in) the 8!r0in) Ca(ita' in STANDARD POLYMER an be #aid a# A))re##i2e (!'i y a !rdin) t! the Ca#h t! 8!r0in) Ca(ita' Rati!$ The a2era)e a#h t! #a'e# rati! i# ,$,,? time# and /hi h indi ate# that !n'y ,$?P !" #a'e# ha# been maintained a# a#h /ith the bu#ine##$

K.2 SUGGESTIONS I RECOMMENDATIONS

STANDARD POLYMER #h!u'd try t! mat h their Ca#h /ith the #a'e#$ In a#e !" #ur('u# Ca#h, it #h!u'd be in2e#ted either in #e uritie# !r #h!u'd be u#ed t! re(ay b!rr!/in)#$ The !m(any #h!u'd try t! (re(are a (r!(er a)ein) # hedu'e !" debt!r#$ Thi# /i'' he'( them t! redu e the bad debt# and #(eed u( !''e ti!n e""!rt#$ The !m(any #h!u'd be (r!m(t in ma0in) (ayment# #! a# t! en.!y a#h di# !unt !((!rtunitie# The !m(any #h!u'd determine the !(timum a#h ba'an e t! be 0e(t$ The !m(any "!''!/ed an a))re##i2e (!'i y !" "inan in) /!r0in) a(ita' #h!u'd try t! "inan e ;,P !" their /!r0in) a(ita' u#in) '!n) term #!ur e and im(r!2e their #tatu#$ The urrent Rati! !" +I< i# !n#idered n!rma''y #ati#"a t!ry$ STANDARD POLYMER #h!u'd try t! im(r!2e the urrent rati!$ S! it #h!u'd in2e#t 'ar)e am!unt in urrent rati!, in !rder t! maintain 'i1uidity and #!'2en y (!#iti!n !" the !n ern$ The !m(any #h!u'd try t! "!''!/ a mat hin) (!'i y "!r "inan in) urrent A##et# Fi$e$G u#in) b!th '!n) term and #h!rt*term #!ur e# !" "inan e#$

CHAPTER VII

CONCLUSION
The Ca#h Mana)ement Ana'y#i# d!ne !n the "inan ia' (!#iti!n !" the !m(any ha# (r!2ided a 'ear 2ie/ !n the a ti2itie# !" the !m(any$ The u#e !" the rati! ana'y#i#, trend ana'y#i#, Ca#h &'!/ Statement and !ther a !untin) and "inan ia' mana)ement he'(ed in thi# #tudy t! "ind !ut the "inan ia' #!undne## !" the !m(any$ Thi# (r!.e t /a# 2ery u#e"u' "!r the .ud)ment !" the "inan ia' #tatu# !" the !m(any "r!m the mana)ement (!int !" 2ie/$ Thi# e2a'uati!n (r!2ed a )reat dea' t! the mana)ement t! ma0e a de i#i!n !n the re)u'ati!n !" the "und# t! in rea#e the #a'e# and brin) (r!"it t! the !m(any$ %e"!re I !n 'ude I /i#h t! !n2ey my than0"u'ne## in re)ard t! the trainin) )i2en t! me in STANDARD POLYMER$ It )a2e me e6treme #ati#"a ti!n and (ra ti a' 0n!/'ed)e !" the "inan ia' a ti2itie# arried !ut in the !m(any$ The 0indne##, attenti!n, and immen#e !*!(erati!n e6tended t! me buy a'' the !""i ia'# in the !m(any made my (r!.e t ea#y and !m"!rtab'e$ Rea''y it /a# a 2ery ('ea#ant e6(erien e in STANDARD POLYMER$

CHAPTER VIII 8.2 SCOPE OF THE STUDY

It he'(# t! ta0e #h!rt term "inan ia' de i#i!n$ It indi ate# the a#h re1uirement needed "!r ('ant !r e1ui(ment e6(an#i!n (r!)ramme#$ T! "ind #trate)ie# "!r e""i ient mana)ement !" a#h$ It he'(# t! arran)e needed "und# !n the m!#t "a2!urab'e term#$ It he'(# t! meet r!utine a#h re1uirement t! "inan e the tran#a ti!n$ It re2ea'# the 'i1uidity (!#iti!n !" the "irm by hi)h'i)htin) the 2ari!u# #!ur e# !" a#h and it# u#e#$

8.2 LIMITATIONS OF THE STUDY

The #tudy i# re#tri ted !n'y t! STANDARD POLYMERS$ %ein) a a#e #tudy, the "indin)# ann!t be )enera'i9ed$ The #tudy d!e# n!t ta0e int! a !unt the in"'ati!n$ The #tudy ta0e# int! a !unt !n'y the 1uantitati2e data and the 1ua'itati2e a#(e t# /ere n!t ta0en int! a !unt

BIBILIOGRAPHY

BOOKS:

S$N$ Mahe#h/ari, &inan ia' mana)ement, E'e2enth Editi!n +,,A, Su'tan Cha1nd @ S!n#, Edu ati!na' Pub'i#her#$ Ne/ De'hi$ I$M Pandey, &inan ia' mana)ement, Ninth Editi!n, 5i0a# (ub'i#hin) h!u#e (2t Ltd$ M$Y 7han* P$7 Cain, Mana)ement A !untin), Third editi!n, Tata M Gra/*Hi'' Pub'i#hin) !$ Ltd %$L$ Gu(ta, Mana)ement !" Li1uidity and Pr!"itabi'ity, Arihant Pub'i#hin) H!u#e, Cai(ur$

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