Working Capital

A study on
“WORKING CAPITAL MANAGEMENT”

With reference to GREEN PARK HOTEL , VIZAG
A project report
Submitted to Integral Institute of Advanced
Management for PGDM internship
program
Submitted by
A JAGADEESH
Under the guidance of
MS. BHAVANI SRI RAMYA
Assistant Professor
Acknowledgement
A research project is never a unilateral effort though the student takes the entire credit. In
preparation of a report through research there is always a team of people who contribute in
one or more ways.
I would like to take this opportunity to express my sincere gratitude to Dr. Ravindra Sunkari,
Dean, IIAM, Vizag for giving me the opportunity to do a summer internship project.
I would like to express my sincere gratitude to Mr. M. Surya Teja, Executive Director, IIAM,
Vizag for giving me the opportunity to do a summer internship project.
I would like to express my sincere of gratitude to our MS.BHAVANI SRI RAMYA, for giving
me the opportunity to do a internship project and guiding me to prepare this project report
and for his mentoring efforts.
I would also like to give my special thanks to those respondents who have given their
valuable time to answer my questions patiently and informatively on a sound base and in
person.
I would like to thank MR. M.V.V.N PRASAD TRAINING MANAGER of Visakhapatnam Hotel
Green Park who gave me an opportunity to do my Project work in an esteemed organization
like Visakhapatnam Hotel Green Park.
I take the pleasure to express my sincere gratitude to thank MR. Praveen, for his valuable
suggestions and encouragement.
An endeavour over a long period can be successful with the advice and support of many well
wishers. I take this opportunity to express my gratitude and appreciation to all of them.
A.JAGADEESH (34044)
DECLARATION
I hereby declare that this project work entitled a study on “WORKING CAPITAL
MANAGEMENT with reference to “HOTEL GREEN PARK” Visakhapatnam, submitted to ‘Post
Graduate Diploma In Management’ programme, Integral Institute of Advanced
Management is originally done by me.
The findings embodied in this project work have not been submitted to anybody in any
other university for the award of any degree.
A.JAGADEESH
34044
CERTIFICATE
This is to certify that the project work entitled “A study on WORKING CAPITAL
MANAGEMENT with reference to “HOTEL GREEN PARK”, submitted to Integral Institute of
Advanced Management , in partial fulfilment of the award of POST GRADUATE DIPLOMA IN
MANAGEMENT is a bonafide work carried out by A.JAGADEESH (34044) under my guidance
and supervision.
Internal Examiner External Examiner
MS. BHAVANI SRI RAMYA Name & Signature
(ASSITANT PROFESSOR)
IIAM B SCHOOL
MR. M. SURYA TEJA
EXECUTIVE DIRECTOR
CONTENTS
CHAPTER 1:
INTRODUCTION
OBJECTIVES OF THE STUDY
SCOPE OF THE STUDY
METHODOLOGY
LIMITATIONS OF THE STUDY
CHAPTER 2:
INDUSTRY PROFILE
COMPANY PROFILE
CHAPTER 3:
CONCEPTUAL PROFILE
CHAPTER 4:
ANALYSIS and INTERPRETATION

CHAPTER 5:
SUMMARY, FINDINGS AND SUGGESTION

CHAPTER 6:
BIBLIOGRAPHY
CHAPTER-1
INTRODUCTION
1.1 INTRODUCTION OF THE STUDY
Cash is the lifeline of a company. If this lifeline deteriorates, the company's ability to fund
operations, reinvest and meet capital requirements and payments will also deteriorate.
The word working means day to day operations of the business, whereas the word capital
means monetary value of all assets of the business. Understanding a company’s cash flow is
essential for making investment decisions. A good way to judge a company's cash flow
prospects, is to look at its working capital.
Finance is the life blood of any business. Finance is a broad term that describes two related
activities: the study of how money is managed and the actual process of acquiring needed
funds.
Working capital gives investors an idea of the company's underlying operational efficiency.
Money that is tied up in inventory or money that customers still owe to the company can’t
be used to pay off any of its obligations. So, if a company is not operating in the most
efficient manner (slow collection) it will show up in the working capital. This can be seen by
comparing the working capital from one period of time to another. Slow debt collection may
be a signal of an underlying problem in the company's operations.
Even companies with cash surpluses need to manage working capital to ensure that those
surpluses are invested in ways that will generate suitable returns for investors.
Working Capital is also called as “ Revolving capital ”, “ Circulating capital ”, OR “ Short-term

capital ”
Working Capital = Current Assets - Current Liabilities

An important characteristic of current assets is conventionally considered to be their
convertibility into cash within a single accounting year unlike fixed assets which
provide the ‘production capital’ for the manufacturing of finished goods for sales.
Current liabilities arise in context of and hence are derived current assets.
Consequently , a lot of emphasis is traditionally placed on current assets (which are
valued on a conservative principle of accounts ) vis-à-vis current liabilities . As a rule of
thumb , the value of 2:1 for the ratio of current assets to current liabilities (popularly
known as current ratio) is considered to be satisfactory by the short term creditors .
the underlying logic being that a company can face unlikely situation of meeting all of
its current liabilities .
1.2 NEED FOR THE STUDY
 To have a knowledge about how the day to day requirements of an organization

are met .
 How capital for day to day operations are procured .
 Working capital management is essential to meet the day to day requirements
of any business firm it assists in knowing the liquidity position of the firm.
 To have a practical knowledge of how working capital management affects the
functioning of the firm .
 Working capital management is one of the key areas of financial decision making.
It is significant because the management must see that an optimum investment in
current assets should protect the company from the problems of stock-out.
 The goal of working capital management is to manage the firm’s current assets
and current liabilities in such a way that a satisfactory level of working capital is
maintained.
1.3 SCOPE OF STUDY
The scope of the study is confined to one of the key areas of finance i.e. Working Capital
Management. A study on Working capital management involves an examination of long
term as well as short term sources that a company taps in order to meet its requirements of
finance. The scope of the study is confined to the sources that THE GREEN PARK HOTEL
tapped over the years under study i.e. 2017-22
1.4 OBJECTIVES OF THE STUDY
 To study the profile and growth of hotel industry in India.
 To study organisational profile of Green Park Hotel, Visakhapatnam
 To understand the theoretical concept of working capital.
 To analyze the trends of working capital changes in Green Park Hotel, Visakhapatnam
 To determine the efficiency of the firm in utilizing its inventory and receivables.
 To offer suggestions for the improvement of working capital management in the
organization.
1.5 METHODOLOGY
The data which I have collected for making this project is combination of both primary and
secondary data.
1.5.1 PRIMARY DATA

This data had been collected through Discussions and Personal Interactions with various
managers and employees of the finance department of THE GREEN PARK HOTEL.
1.5.2 SECONDARY DATA
Apart from the primary data certain secondary data is required for this project. Secondary
data is the one which is collected by someone other than the user i.e. the data is already
available and analysed by someone.
Following are the sources of secondary data for this project :-
• ANNUAL REPORTS (YEAR ENDED :- 2017-2022)

• INCOME STATEMENT (YEAR ENDED :- 2017-2022)
1.6 LIMITATIONS OF THE STUDY
In any study or analysis there shall be some limitations associated with it. Hence, for the
proper understanding of the project it is inevitable to specify the limitations of the study.
 The study is based on financial data of past 5 years only.
 Some of the information has been kept confidential as such information is
not passed on as a part of the policy of the company.
 There was less chance to interact with the employees to gather more information
due to their tight work schedule.
 We were given only 45 days time period for the internship , which is very less to
have a good exposure .
CHAPTER-2
INDUSTRY PROFILE
PROFILE OF HOTEL INDUSTRY
The hospitality industry is a broad category of fields within the service industry that includes
lodging, restaurants, event planning, theme parks, transportation, cruise line, and additional
fields within the tourism industry. The hospitality industry is a several billion dollar industry
that mostly depends on the availability of leisure time and disposable income. A hospitality
unit such as a restaurant, hotel, or even an amusement park consists of multiple groups
such as facility maintenance, direct operations (servers, housekeepers, porters, kitchen
workers, bartenders, etc.), management, marketing, and human resources.
Hotel industry has been playing an important role in the economic development of
various countries. Almost all the developed countries and a majority of developing
countries emerged as service economies. USA was the first economy to become a service
economy. The basics intermediate demand for the development of the service sector are
growth in intermediate demand from various manufacturing organizations which are in the
process of unbundling and direct demand from customers. Service sector has been given
important place in the Indian planning since the sixth five-year plan. The service sector
contribution to the GDP of India rose from 28.6% to 45.19%in 1998-99. However the
statistics do not reveal the true picture as the hidden service sector and services in the
unorganized sector are not added to the total. There is a tremendous potential for the
growth of service in the country. The major services in the country are Transport and
Communication. Trade, Hotels and Restaurant, community, social and personal services and
Finance and real estate services.
HOTEL – THE CONCEPT
Initially the term motel was meant for local motorists and foreign tourists traveling by
road. Basically Motels serve the needs and requirements of these travelers and meeting the
demand for transit accommodation. We can also call motel overnight stay. Some of the
important services offered by motels are parking, garage facilities, accommodation, and
restaurant facilities. Motels are found equipped with filling stations, accessories, service of
elevator to the automobile entrance restaurant etc., Motel are found located outside the
city. Preferably by the side of high ways and important road junctions. The accommodation
available in the Motel is more in the category of a ‘chalet facility’. This has a dining hall with
fixed menu. In USA the hotel accommodation is ranked at par with hotel accommodation .
HOTEL MANAGEMENT:
Hotel management is a globally accepted career field and academic field of study.
Degree programs such as hospitality management studies, a business degree, and/or
certification programs formally prepare hotel managers for industry practice. Most hotel
establishments consist of a General Manager who serves as the head executive (often
referred to as the "Hotel Manager"), department heads who oversee various departments
within a hotel, middle managers, administrative staff, and line-level supervisors. The
organizational chart and quantity of job positions varies by hotel size, function, and is often
determined by hotel ownership.
GROWTH OF HOTEL INDUSTRY
The real boom in the hotels came in the 20th century. The new hotel area was first
dominated by the Oberoi group, Taj, ITC – Welcome Group, ITDC and other large luxurious
groups of hotels. Asian hotels are the other groups which have made a mark for them.
Many groups are entering the hotel business. Apart from these, Chains which are mainly
privately owned (with exception of ITDC which is a government of India undertaking), the
State tourism corporation to have come into the hotel business in order to cater to the
growing tourists and the business traffic. Through the large chains have made their debut,
the hotel keeping in India still has a strong individualistic style since three fourths of the
hotels all over the country are in the hands of small operators. Changing market
perceptions have forced even the major groups to diversify into smaller budget hotels a
competition has thus increased in the industry.
With the growth of tourism in India, the hotels in the holiday and availability of modern
technological gadgets and the future holds promise for a further mushrooming of modern
hotels.
The Popular Groups of Hotels in India are listed below:
1) Oberoi Group
2) Taj Group
3) ITC’s Welcome Group
4) ITDC’s Ashok Group
5) Mahindra Group
6) Apeejay Group
7) Amrita Group
8) Leela Kempenski Holiday Inns
9) Centaur Hotels
10) Asian Hotels
WELCOME GROUP’S HOTEL IN VISAKHAPATNAM
Welcome Group’s Grand Bay, a 100-rooms property is open for business in Visakhapatnam.
The hotel offers deluxe and executive clubrooms with tariffs ranging from Rs 1800 to 4200
and deluxe suites. It is being marketed as a tourist-cum-business address.
“HOTEL DASPALLA” IN VISAKHAPATNAM

The Tourism department has awarded Hotel Daspalla as the best hotel for the services it
has provided to the tourists. It has gained second position in Andhra Pradesh. Hotel
Daspalla has recently been added to Quality Inn chain of hotels in India.
“HOTEL THE PARK” IN VISAKHAPATNAM
Overlooking the Bay of Bengal, this luxury five star hotel in Vizag sprawls over 6 acres of a
spectacular private beachfront. Sandy beaches complete with a lighthouse underline the
romance of the sea with breathtaking sunrises and lovely tropical gardens adoring “THE
PARK VIZAG”
“HOTEL DOLPHIN” IN VISAKHAPATNAM

Dolphin Hotel is the premium global chain luxury four star beach hotel in Vizag, from
The Dolphin Group for business, leisure & internationally acclaimed for the best restaurant.
“HOTEL NOVOTEL” IN VISAKHAPATNAM

Novotel is a mid-scale hotel brand within the Accor Hotels group, typically
Slotting between the mercury and Pullman brands.
Novotel has over 470 hotel And resorts in 61 countries.
“GREENPARK” IN VISAKHAPATNAM
Green Park, Visakhapatnam has been awarded for its excellence in customer services.
Following a number of stringent parameters and checks done on customer services Hotel
Green park- Visakhapatnam came up with flying colors. HSBC leading multinational bank
has recognized the hotel for its excellence in customer’s services. This is yet another feather
in the cap of Hotel Green Park, a hotel which has been nominated “The Best Business Class
Hotel in India” and it’s General Manager of the year (India) “during the past year by the
Hotel’s &Food services
HOTEL GREEN PARK
ORGANIZATION PROFILE
GREEN PARK INTRODUCTION
Green Park is one of the best “Value for Money”, VFM hotel in this part of the country and
the responsibility of further maintaining and improving world-class standard-lives with it. In
the Green Park family, they always believe in being the best as far as quest services and
concerned. They follow the motto of the 4 G’s.
The 4 G’s are
 Guest is our god.

 Green park is our temple
 Good work is our prayer
 Guest delight is our reward.
Global Destiny
The Green Park family (staff) has a missionary zeal to achieve their objectives.
MISSION OBJECTIVES:
1. Customer Intimacy:
 Fast service
 Hassle free service
 Deliver more value than the customer expectation
 Superior quality
 Care and concern
2. Operational Excellence:
 Proper systems, proper people, Proper training

 Defect free product & service
 Eye for detail, Fast and flexible, Communication
 Feedback, controls and correction mechanisms, cost control.
3. Product Leadership:
 Superior product
 Superior value
 Up-to-date
 Innovation and creativity
4. To foster intellectual capital:
 Focus on people
 Build knowledge
 Build creativity
 Build talent at all levels
 To Nurture “Thinking”, “Analysis”, and “Innovation”.
ORGANIZATIONAL GOALS
a) To foster a nurturing work environment

b) To develop leadership at all levels through effective delegation
c) To develop people at all levels through empowerment
d) To sharpen skills at all levels through focused training
e) To encourage creativity and value addition at all levels.
Organization Philosophy-Ordinary people doing extra-ordinary things.
VISION STATEMENT
Fast:
To display a sense of urgency and bias for action and to react quickly to market changes,
customer needs a team members input as a company and individual team member.
Focused:
To display a spirit of continuous improvement, dedicate energy, attention and resources to
make our processes and practices as efficient and effective as possible.
Flexible:
Cooperation and teamwork among the team members and between departments and
properties will keep the company aligned and increased productivity. The company
continuously encourages the idea exchange and participative decision making.
People:
At Hotel Green Park the people are valued as the most treasured asset
GREEN PARK hotel

VISAKHAPATNAM PROFILE
Hotel Green Park – Visakhapatnam is located in the heart of the city, at close proximity to
the railway station and business center and takes about 20 minutes to reach the Airport.
The Address of the Hotel is
Hotel Green
Park, #126-1-17,
Waltair Main
road,
Visakhapatnam-2,
Andhra Pradesh,
India.
Telephone : 0891-2564444
Fax : 0891-2563763
Website : hotelgreenpark.com
Total Rooms: 110
No. of Floors: 06
Hotel Ratings: 4 star
Hotel Type : Business and Leisure Hotel
FACILITIES AT THE GREEN PARK HOTEL VIZAG :-
 110 Rooms
 All day dining
 Specialty Indian Restaurant
 Specialty Pan Asian
 Executive Bar
 Business center
 Meeting Lounge
 Fitness center
 Swimming pool
 Conferencing & Events
Basement:
Department of HRD, G&A, Stores purchase, Housekeeping, Laundry, Locker, time-office,

Cafeteria, Kitchen, Stewarding and Security offices.
Lobby Level:
GM’s office, front office, Banquet sales, Marketing department, F&B outlets-Princes,
southern spice, memories of china, main kitchen and 5 banquet halls.
Rooms:
 Executive rooms - 30
 Deluxe rooms - 41
 Business club - 25
 Executive suit - 05
 Quality Suit - 08
Banquet Halls
Area Conference /theatre Reception Banquet

Function Space (In sq ft) style (sit
down)
Chancery 2,550 300 240 100

Consulate 750 60 40 35
Meadows 6,500 650 1200 650
Gardenia 1500 - 75 50
Star Lights 5500 - 400 150
BC Launge
RESTAURANTS
Name of the outlet Where Capacity Remarks
covers
Lobby
Tulips 88 Coffee Shop
Level
Lobby Breakfast, Lunch, Dinner and
Once Upon A Time 94
level Midnight Biryani- Buffet
Business Club Lounge 4th

Floor
Lobby
Mustang Bar 33 Bar
Level
Mekong 1st 80 Pan Asian Restaurant
Floor
They have Four Food and Beverage outlets located as follows:
 Once Upon a Time - Buffet & Midnight Biryani.

 Mustang Bar - Bar.
 Mekong - Pan Asian Restaurant
 Tulips - Lunch. & Dinner
The various Conference & Banquet facilities available in Hotel Green Park
 Chancery - The largest with a capacity of 300 people

 Consulate - With the capacity for 50 Persons
 Gardena - Open air with a capacity for 50-60 persons
 Meadows - Open air lawns with capacity for 1500 people
BOARD OF DIRECTORS
Chairman Mr. G. Harischandra Reddy
Vice Chairman Mr. G.V. Prasad
Executive Director Mrs. A. Parvathy Reddy
Director Mr. K.V. Ravindra Reddy
Director Mr. G. Harischandra Prasad
Director (Chairaman - Dr.Reddy’s Labs Ltd) Mr. K. Satish Reddy
Director Mrs. G. Anuradha Reddy
Director Mrs. G. Shyamala

Managers at the corporate office
Chief Executive Officer (CEO) Mr. B. Gautam
President Mr. K. Mohan Krishna
Vice President – Finance Mr. M.N Narayana Murthy
Senior General Manager – Operations Mr. S.Venkateswara Rao
General Manager - Business Development Mr. K. M. RAO
General Manager – Business Process Management Mr. K. A. Srinivas
General Manager – Projects Mr. P. Rangaswamy
General Manager - Project, Renovation & HK Mr. Manesh

Managers at GreenPark- Visakhapatnam
Designation Name of the Manager
General Manager Mr. Barani
Executive Chef Chef Subbarayalu
Asst Manager Front office Mr. Kousik
F&B Manager Mr. Santosh Tewary
Manager House Keeping Mr. Kumar
Manager HR Mr. Sathayanarayana Reddy
Asst. Manager Training Mr. Prasad Makala
Finance Manager Mr. Ch. V. Rajsekhar
Director Sales Mr. I. V. Vasu
Dy Manager -- Purchase Mrs. B. Aruna Devi
Asst Security Officer Mr. Kishore Kumar
IT Executive Mr. Gopi
Chief Engineer Mr. Ramanaraju
Doctor Dr. V.V. Rao

DEPARTMENTAL FUNCTIONS IN
HOTEL GREEN PARK
As mentioned earlier various departments for the basis hotel green park. The functions
of each of the departments are described as below.
FRONT OFFICE DEPARTMENT
Hospitality is the basic component in the hoteling industry, and the Front Office
department is all about hospitality and image building. Front Office is the first department
with which the guests come in contact; therefore it is up to this department to keep up the
image of the hotel.
The personnel in the Front Office department receive the guests and guide them to their
rooms or required places, offering them helpful guidance whenever requested. Since the
Front Office personnel are the personnel with whom most frequent contact is established
by the visitors, they need to possess a pleasing demeanour under all situations. The various
sections of this department are telephone, reservations, reception, bell desk, cashier,
hospitality desk, business center.
HOUSE KEEPING DEPARTMENT

The House Keeping department looks after the overall sanitation of the hotel. It contains
an executive, supervisors, houseman and other staff. The primary job of the department is
to see that all areas of the hotel are kept clean. If falls upon the House Keeping department
to change the bed sheets, linen etc… in the individual rooms and take care of the laundry
requirements of the guests.
The House Keeping department plays a prime role in bolstering the image of the hotel for
it’s an essential service and bears direct contact with the guests.
The house keeping departments works in three shifts. They are-

SHIFT A - 7.00 To 13.00
Hrs SHIFT B - 13.00 to 22.00
Hrs SHIFT C - 22.00 to 7.00
Hrs
The following are the files and registers at DESK of House keeping…
 Guest calls
 Departure
 Key
 Staff placement
 Briefing
 Guest comment
 Logbook
 Attendance
 Handover
 Staff movement
 Lost & Found
 Job order
SECURITY DEPARTMENT
In the ancient treaties, the Arthasastra, Kautilya give great element of importance to the
maintenance of security at home and outside. Indeed, security is a very important aspect of
running a hotel, for when people walk in unsuspectingly to be your guest, it’s imperative
that due importance should be given to their life and belongings.
Over here, the Security department consists of an executive, four supervisors working on
contract and their crew. Among the functions of the security department are included.
 Checking of non-executive staff.

 Checking of all in and out movements.
 Surveillance of the entire hotel.
 Curtaining non-disciplinary actions.
 Surveillance of hotel staff.
 Emergency duties like fire fighting etc…
FINANCE DEPARTMENT
The accounts department is headed by the Finance manager and is assisted by 2 Dy.
Manager. This department runs with 25 staff members. Being a major for any
organizations, very minutest detail must be taken care of and hence, the accounts staff is
responsible for it. Account department has to cooperate and coordinate so that the
company is operational a break-even with less occupancy ration.
FOOD & BEVERAGE (SERVICE) DEPARTMENT
It acts as a medium through which the services produced are offered to customers. Its
restaurant service offers its services to the customers in the three eloquent restaurants
namely.
 Southern Spice
 Princess
 Escape (the bar)
While the room service is meant for the guests residing in the rooms of the hotel. The
Banquet service looks after the gathering and functions conducted in the hotel premises.
This department is headed by an executive followed by the captains leading their teams
to offer their best services to their guests.
FOOD & BEVERAGE (PRODUCTION) DEPARTMENT
A hotel gains its reputation through the quality of services it offers to its customers
among the variety of services catering is the prime service. It is so because this is the aspect
in which one hotel distinguishes its self among others.
F & B (P) is the department, which holds the key responsibility for this service. This
department cooks food to cater the tastes of its customers. It is divided into Indian,
Continental and Chinese. In each section com-I is the head. The type of food ordered for is
prepared in its exclusive section.
HR ACTIVITIES
The following are the human resources activities followed by Green Park, Visakhapatnam.
HR Functions:
 Recruitment and Selection
 Induction
 Time office function like attendance, leaves, absenteeism, personal grooming
 Maintaining personal files, Performance Appraisal
 Training and Development
 Compensation management
 Taking care of statutory compliance like ESI, PF etc…
 Welfare facilities like picnic, award functions and sports

 Career development programs.
Leaves:-
1. Earned Leaves:-
15 leaves are sanctioned for every year of service completed not more than 3
occasions in a year. It can be carried forward and accumulated not beyond 60 days and also
weekly offs between the leaves are eligible. These leaves are attached with any leaves.
2. Casual leaves:-
There are 12 leaves per a calendar year not more that 3 days at a stretch. The weekly offs
between the leaves are not permitted and these leaves can be attached with any leave and
cannot be carried forward.
3. Compensatory Off:-
Any employee who does the extra 4 hours of work over and above his regular duty is
eligible to claim any number of C’ offs at a stretch within 6 months from the date of
accumulation. It can allow the weekly offs between the leaves and they can attach with any
leaves. The calculation of C’ off is if the work is above 4 hrs and below 6 hrs it should be
treated as half-day and above 6 hrs it is a full days.
Training & Development
A separate cell called Green Park center for – Learning and Development (GPCLD) in HRD
is dedicated to co-ordinate the training and development activities. Training programs are
organized from time to time as per the requirement. The attendance during the training
programs is also monitored and recorded for future reference during the appraisal. Points
are allocated to the participative employees in training programs are taken into
consideration.
Library:
All the employees are invited to make use of books available in the library for circulation
& issued from the library on a periodic basis.
Time Office Functions:
It checks the personal grooming, proper shaving, neat haircut, proper pressed uniform,
short nails, well polished brass buttons, shoe polishing, wearing black socks of the
employees in the hotel.
Absenteeism:
Absenteeism without intimation will be treated severely. An advisory memo will be sent
to absentee beyond 3 days. It intimation has to be given by the employee to the concerned
in charge personally. Incase of sickness the employee has to get a medical certificate of
sickness and fitness from the ESI doctor only.
Awards:
1) Performer of the month

2) Service excellence award
3) Grooming excellence award
4) Customer delight quality suggestion award
5) Cost control suggestion award
6) Executive of the month
7) 100% Attendance for the quarter
Cafeteria:-
Park café is an in house café. It caters to all the hunger needs of all the employees,
executives and managers who can have their meals and snacks in the cafeteria during the
prescribed timings. The means are charged at subsidized rate however as under.
Any suggestion to improve the effectiveness / performance of cafeteria, are welcome and
may be put in the suggestion Box specially located in the cafeteria for the members.
MARKETING ACTIVITIES
It is headed by Marketing Manager. He is assisted by Marketing Executive, sales

executive and sales Coordinator.
Sales in Hotel : Rooms, Conference halls, Restaurants and Banquets.
Functions of Sales Department
1) Airport Sales:
Hotel Green Park manages an airport counter, up keep of tariff sheets, visiting cards
and photographs, depicting various activities and amenities that are normally
provided.
 Departure Lounge
Guest will be waiting in the departure lounge, waiting to board the plane.
Hence, they can give visiting cards, tariff sheets and convey good account of
the hotel as reference.
 Arrival Lounge
Hotel Green Park can speak to the quest and if they find they do not have a
confirmed reservation with any hotel, Green Park can invite them to stay at
their rooms and arrange transport for the guest.
2) Oral Selling Public Relations:

Hotel Green Park interacts with Firms, Companies, Corporates, Insurance companies,
Shipping companies, Licensing agents and meets the top head and explains the
services Green Park is rending to the valued customers across the country and to
make them put their case in Green Park, Visakhapatna
3) Sponsorships: For conducting food festivals, Green Park may approach some
companies and get some sponsorship
4) Press Release:
 Put a poster in place where lots of people come from different parts of the country.
 Introductory Letters are sent to company officials to whom Green park arranges at
the airport/railway station for bringing parties.
 “THANK YOU” letters are sent to quests that have stayed with Green Park and are
satisfies and left happy with cherished memories.
 “Discount Letters” are sent to companies who can assure of a certain granted rooms
in a year so that high occupancy ratio can be achieved.
 In House Marketing Staff meet quests during break fast/ lunch/ dinner in the rooms
or in the lobby, by group or individuals and quests are look after well by group
coordinators. They shall go a long way in marketing the quests feel homely after
their tiresome day to staff.
ACHIEVEMENTS OF HOTEL GREEN PARK
1. Mr. Varghese George, Vice President – awarded as the “Best General Manager of
the year 1998” by H&FS.
2. Mr. Madhu Nair, General Manager – Awarded as the “Best General Manager of the
year 1999” by H&FS.
3. Mr. Mohan Krishna, FOM awarded as the” Best Front Office Manager of the year”
in the Year 1999 by H&FS India.
National Awards
1. GreenPark, Visakhapatnam won “Best Economy Business Class Hotel” for the year
2002.
2. GreenPark, Visakhapatnam won “Star Achiever Award “for Excellence in Hospitality
Industry for the year 2007.
3. Diana Hotels Ltd awarded “Emerging India 2007”. (Under Travel and Tourism
Category)
State Awards
1. Green Park Hotel, Hyderabad – “The Best 4 star Hotel in the State” by the
Department
Of Tourism – Andhra Pradesh for the years 2003, 2004, 2005, and 2007.
2. Green Park, Hyderabad-Recognized for “Excellence in Conservation of Energy “by
the Institute of Engineers (India), A.P State.
3. GreenPark Hotel, Visakhapatnam –“The Best 3 star Hotel in the Region “by the
Department Of Tourism, Andhra Pradesh 2003, 2004, 2006, and 2007.
1. GreenPark, Hyderabad was nominated as “Star Achievers Award “2007 to FHRAI.
2. GreenPark, Hyderabad nominated for CNBC Awaaz Travel Awards 2008 in the
Category – ‘Best Leisure Hotel’.
GREENPARK STAR ATTRIBUTES
You would learn what is expected of you while you are working at GreenPark.
Probably, this has set you wondering if you possess the requisite qualities to succeed
in the hospitality industry.
1. SELF CONTROL:
In hospitality industry customer is always right. Hence you'll be expected to be
polite, calm, pleasant and friendly. Arguments, discussions, excuses and explanations
are to be avoided at any cost as they only add fuel to the fire instead of helping you
to resolve the problem.
2. FRIENDLY AND OUTGOING PERSONALITY:

If you are naturally friendly and outgoing you are more likely to be successful
working in a hotel. Being able to deal with all kinds of guests and visitors combined
with a keenness to serve them with a genuine smile is an asset.
3. RIGHT ATTITUDE TO WORK:

While working in the hotel, you should be prepared to do any kind of job if the
circumstances demand it. Dignity of labour is one of the first lessons you’ll have to
learn. It is possible; you'll discover along how much more satisfying it is to work with
one's own hands.
4. GOOD HEALTH AND PHYSICAL FITNESS:

You need good mental and physical stamina to survive the long and odd working
hours. Moreover, you may have to spend most of your working day on your feet,
especially on busy days. You are required to be in good health all the time.
5. GROOMING AND PLEASING PERSONALITY:

You are more likely to be confident if you are well groomed, neat, polite and have
an easy way with people. An impressive and pleasing appearance is always a plus
point in public relations.
6. READY SMILE AND CHEERFULNESS: “A smile” It’s a universal welcome which has
no language, it tells others that there is a caring, sharing person in you and as
hospitality personnel you are never fully dressed without a smile.
7. ABILITY TO FACE CHALLENGES:

There is never a dull moment in a hotel. Everyday is full of challenges stimulating you
and demanding your presence both mentally and physically.
8. TEAM SPIRIT:
In hospitality industry you are always working as part of a team, which needs your
help, co-operation and willingness to listen to others. You must be flexible and
accommodating and enjoy working as part of a team.
9. SELF DISCIPLINE:
Just about every item in a hotel can be useful; there can be lot of temptation to carry
out small things for personal use. You must be able to resist such temptation, and be
honest and sincere at your job.
10. ABILITY FOR HARD WORK:
Working in hotels is always demanding and only those works hard and sincere can
hope to rise in their career. An employee, who works willingly is always noticed by
the management and is likely to go places.
CHAPTER - 3
THEORITICAL FRAMEWORK
THEORETICAL FRAMEWORK
Working Capital Management means the deployment of current assets and current
liabilities efficiently so as to maximize short-term liquidity. It is concerned with the problems
that arise in attempting to manage the Current Assets, Current Liabilities and the
interrelationship that exists between them. Working capital management entails short term
decisions generally, relating to the next one year period which is "reversible".
IMPORTANCE OF WORKING CAPITAL MANAGEMENT
 Working Capital is the Life Blood of the Business
 Fixed Assets (Long Term Assets) can be purchased on Lease/Hire Purchase but
Current Assets cannot be.
 The liquidity V/s Profitability objectives of Working Capital Management
 To decide Optimum Level of Investment in various Assets
 To decide Optimal Mix of Short Term and Long Term Capital
 To decide an appropriate means of Short Term Financing
 For maintaining a balance of income to debt.
Need for Working capital
 For the purchase of raw materials, spares and so on.
 To pay wages and salaries.
 To incur day-to-day expenses and overhead costs.
 To meet selling costs as packing, advertising and so on.
 To provide credit facilities to the customers.

 To maintain the inventories of raw material, work in progress, stores and finished
stock.
FACTORS DETERMINING WORKING CAPITAL:-
The working capital needs of a business are influenced by numerous factors. They are:
 Nature of business.
 Working capital cycle
 Size of business.
 Credit policy.
 Production policy.
 Business cycle.
 Manufacturing process.
 Rate of growth of business.
 Seasonal variations.
 Dividend policy.
 Rate of Stock turnover.
 Price level changes
A few of them are discussed in brief as given below:
 Nature of Enterprise : The nature and the working capital requirements of an

enterprise are interlinked. While a manufacturing industry has a long cycle of
operation of the working capital, the same would be short in an enterprise involved
in providing services. The amount required also varies as per the nature, like an
enterprise involved in production would require more working capital than a service
sector enterprise.
 Manufacturing/Production Policy : Each enterprise in the manufacturing sector has
its own production policy, some follow the policy of uniform production even if the
demand varies from time to time, and others may follow the principle of 'demand-
based production' in which production is based on the demand during that particular
phase of time. Accordingly, the working capital requirements vary for both of them.
 Working Capital Cycle : In manufacturing concern, working capital cycle starts with
the purchase of raw materials and ends with realization of cash from the sale of
finished goods. The cycle involves the purchase of raw materials and ends with the
realization of cash from the sale of finished products. The cycle involves purchase of
raw materials and stores, its conversion into stock of finished goods through work in
progress with progressive increment of labor and service cost, conversion of finished
stock into sales and receivables and ultimately realization of cash. This cycle
continues again from cash to purchase of raw materials and so on.
 Operations : The requirement of working capital fluctuates for seasonal business.
The working capital needs of such businesses may increase considerably during the
busy season and decrease during the slack season. Ice creams and cold drinks have a
great demand during summers, while in winters the sales are negligible.
 Market Condition : If there is high competition in the chosen product category, then
one shall need to offer credit, immediate delivery of goods etc, for which the
working capital requirement will be high. If there is no competition or less
competition in the market, then the working capital requirements will be low.
 Business Cycle : Business Cycle refers to alternate expansion and contraction in
general business activities in a period of time. When the business is prosperous there
is a need for larger amount of working capital due to increase in sales, rise in prices,
optimistic expansion of business etc. During the time of depression, that is, when
there is a down swing of the cycle, business contracts, sales decline, difficulties are
faced in collections from debtors and firms may have a large amount of working
capital lying ideal.
 Availability of Raw Material : If raw material is readily available then one need not
maintain a large stock of the same, thereby reducing the working capital investment
in raw material stock. On the other hand, if raw material is not readily available then
a large quantity of inventory/stock needs to be maintained, thereby calling for
substantial investment in the same.
 Growth and Expansion : Growth and expansion of business results in the
enhancement of working capital requirement. As business grows and expands, it
needs a larger amount of working capital.
 Earning capacity : Some firms have more earning capacity than others due to the
quality of their products, monopoly conditions. Such firms with high earning capacity
may generate cash profits from operations and contribute to their capital. Such firms
can maintain less working capital.
 Dividend Policy: The dividend policy of a concern also influences the requirements
of the working capital. A firm that maintains steady high rate of cash dividend
irrespective of its generation of profits needs more capital than the firm retains
larger part of its profits and does not pay high rate of cash dividend.
CONCEPT OF WORKING CAPITAL
Positive working capital generally indicates that a company is able to pay off its short-term
liabilities almost immediately. Negative working capital generally indicates that a
company is unable to do so.
The decrease in working capital suggests the following things:
 a company is becoming overleveraged, or
 it is struggling to maintain or grow sales, or
 it is paying bills too quickly, or
 it is collecting receivables too slowly.
Increase in working capital, on the other hand, suggests the opposite.

There are several ways to evaluate a company's working capital further, including
calculating the inventory-turnover ratio, the receivables ratio, days payable, the current
ratio, and the quick ratio.
One of the most significant uses of working capital is inventory. The longer inventory sits on
the shelf or in the warehouse, the longer the company's working capital is tied up.
There are two concepts of working capital. They are :
1. Gross working capital
2. Net working capital
GROSS WORKING CAPITAL
The term gross working capital, also referred to as working capital means the total current
assets. This is known as the Quantitative aspect of Working Capital, and hence, focuses on:
 Optimum investment in Current Assets and
 Financing of Current assets.
Importance of Gross Working Capital :
 It enables to provide correct amount of working capital at the right time.
 It takes into consideration the fact that every increase in the funds of the enterprise
would increase its working capital.
 It is useful in determining the rate of return on investments.
NET WORKING CAPITAL
The term net working capital can be defined in two ways:
1. The most common definition of net working capital is the difference between the
current assets and the current liabilities.
2. The Net working capital is that portion of current assets which is financed with long
term funds. Since the current liabilities represent the sources of short term funds, as
long as current assets exceed current liabilities, the excess must be nuanced with
long term funds.
The net working capital, as a measure of liquidity is quite useful for internal
control. The net working capital helps in comparing the liquidity of the same firm over time.
This is known as Qualitative aspect of Working Capital and the focus is on:
 Liquidity Position of the Firm and
 Working Capital amount that can be financed by permanent sources of funds.
Working Capital = Current Assets - Current Liabilities
Importance of Net Working Capital :
 It indicates the firm’s ability to meet its operating expenses and short-term liabilities.
 It indicates the margin of protection available to the short-term creditors.
 It is an indicator of the financial soundness of an enterprise.
 It suggests the need for financing a part of the working capital requirement out of
permanent sources of funds.
DIFFERENT ASPECTS OF WORKING CAPITAL MANAGEMENT
1) Management of Inventory
2) Management of Cash
3) Management of Receivables/Debtors
4) Management of Payables/Creditors
INVENTORY MANAGEMENT
Maintaining Inventory at the Optimum Level is called Inventory Management. It involves

capital costs, storage and handling costs, risk of price decline, risk of obsolescence and risk
of deterioration in quality. Inventory management includes proper planning of purchasing,
handling, storing and accounting .
OBJECTIVES OF INVENTORY MANAGEMENT
 The materials and spares should be available in sufficient quantity so that work is not
disrupted for want of inventory.
 Investments in inventories should not remain idle and minimum working capital
should be locked in it.
 To design proper organization for inventory management.
 To ensure perpetual inventory control so that materials shown in stock ledgers

should actually be in the stores.
 To ensure right quality goods at reasonable prices.
 To facilitate furnishing of data for short term and long term planning and control of
inventory.
 Minimizing the wastage
 Better service to customer
 Control over production levels that is, optimum inventory production

Inventory management is an important aspect of working capital management because
inventories themselves do not earn any revenue. Holding either too little or too much
inventory incurs costs.
Problems of carrying excess inventory are:
 Opportunity cost of foregone interest;
 Warehousing costs;
 Damage and pilferage;
 Obsolescence;
Problems of carrying less inventory are:
 Stock out costs:
 Lost sales;
 Delayed service.
 Ordering costs:
 Freight;
 Order administration;
 Loss of quantity discounts.
CASH MANAGEMENT
Cash management means efficient collection & disbursement of cash and any temporary
investment of cash. Maintaining optimum level of cash in an organization is called cash
management. Cash management deals with cash inflows and outflows and cash balances
held by the firm at a point of time. Good cash management can have a major impact on
overall working capital management.
The key elements of cash management are:
1. Cash forecasting
2. Balance management
3. Administration
4. Internal control.
Methods of decelerating cash outflows:
a) Paying on last date .

b) Payments through drafts .
c) Centralization of payments .
d) Inter-bank transfer.
Methods of accelerating cash inflows:
a) Prompt payment by customers.

b) Quick conversion of payment into cash .
c) Decentralized collections .
CREDITORS MANAGEMENT
Creditors are the businesses or people who provide goods and services in credit terms. That
is, they allow us time to pay rather than paying in cash. The length of credit period allowed
is also a factor that can help a potential customer deciding whether to buy from a company
or not: the longer the better.
DEBTORS MANAGEMENT
The objective of debtor management is to minimize the time-lapse between completion of

sales and receipt of payment. Debtor management includes both pre-sale and debt
collection strategies. The costs of having debtors are:
 Opportunity costs (cash is not available for other purposes);

 Bad debts.
Pre-sale strategies include:
 Offering cash discounts for early payment and/or imposing penalties for late
payment;
 Agreeing payment terms in advance;
 Requiring cash before delivery;
 Setting credit limits;
 Setting criteria for obtaining credit;
 Billing as early as possible;
 Requiring deposits and/or progress payments.
Post-sale strategies include:

 Placing the responsibility for collecting the debt upon the center that made the sale;
 Identifying long overdue balances and doubtful debts by regular analytical reviews;
 Having an established procedure for late collections, such as a reminder; a letter;
 Cancellation of further credit;
 Telephone calls;
 Use of a collection agency,
 Legal action.
WORKING CAPITAL FINANCING
Banks are the main institutional sources of working capital finance in India. Bank credit is
the most important source of working capital requirement of firms in India. A bank
considers a firm’s sales and production plans and the desirable levels of current assets in
determining its working capital requirements. The amount approved by the bank for the
firm’s working capital is called credit limit.
Working capital management takes place on two levels:
1. Ratio analysis can be used to monitor overall trends in working capital and
2. To identify areas requiring closer management.
The individual components of working capital can be effectively managed by using various
techniques and strategies. When considering these techniques and strategies, departments
need to recognize that each department has a unique mix of working capital components.
This indicates that the need of each component varies according to department.
Furthermore, working capital management is not an end in itself. It is an integral part of the
department's overall management. The needs of efficient working capital management
must be considered in relation to other aspects of the department's financial and non-
financial performance.
CHAPTER – 5
DATA ANALYSIS AND INTERPRETATIONS

STATEMENT OF CHANGES IN WORKING CAPITAL OF THE GREEN PARK HOTEL
for YEAR ENDED 2017-18
(Rs. In thousand )
PARTICULARS 2017 2018 INCREASE DECREASE

IN IN
WORKING WORKING
CAPITAL CAPITAL
CURRENT ASSETS
Inventories 6360 5170 1190
Trade Receivables 9680 6170 3510
Cash and cash equivalents 3610 (47) 3657
Short term loans and advances 9165 6845 2320
Total Current Assets (A) 28815 18140 10677
CURRENT LIABILITIES
Trade payables 7230 6890 340
Other Current Liabilities 10897 9770 1129
Short Term Provisions 1485 2785 1300
Total Current Liabilities (B) 19612 19445 1300 1469
Net Working Capital (A-B) 9203 (1305) (1300) 9208
Decrease in Working Capital 10508 10508
Total 9203 9203 9208 9208

INTERPRETATION :-
 There is a decrease in the current assets compared to last year.

 There has been a minimal decrease in the overall current liabilities compared to
2017.
 The net working capital decreased and became negative , and it resulted in
a decrease in working capital for 2017-18.
STATEMENT OF CHANGES IN WORKING CAPITAL OF THE GREEN PARK HOTEL for YEAR
ENDED 2018-19
(Rs. In thousand )

IN IN
WORKING WORKING
CAPITAL CAPITAL
CURRENT ASSETS
Cash and cash equivalents (47) 4615 4662
Total Current Assets (A) 18140 26155 8017 0
CURRENT LIABILITIES
Trade payables 6890 - 6890

Net Working Capital (A-B) (1305) 5145 (2173) (8623)
Increase in Working Capital 6450 6450
Total 5145 5145 2173 2173
INTERPRETATION :-
 There is an increase in the current assets compared to last year.

 Creditors became nil in 2018, but there has been an increase in the overall
current liabilities compared to 2017.
 The net working capital increased , and it resulted in a positive working capital
for 2018-19.
ENDED 2019-20
(Rs. In thousand )

IN IN
WORKING WORKING
CAPITAL CAPITAL
CURRENT ASSETS
Cash and cash equivalents 4615 3731 884
CURRENT LIABILITIES
Trade payables - 7530 7530
Net Working Capital (A-B) 5145 4971 (4935) (4761)
Decrease in Working Capital 174 174
Total 5145 5145 (4761) (4761)

INTERPRETATION :-

 Creditors increased in 2019, but there has been a decrease in the overall
 The net working capital decreased , and it resulted in a decrease in working
capital for 2019-20.
ENDED 2020-21
(Rs. In thousand )

IN IN
WORKING WORKING
CAPITAL CAPITAL
CURRENT ASSETS
CURRENT LIABILITIES

Total 6487 6487 (2014) (2014)
INTERPRETATION :-

 Creditors decreased drastically , but there has been an increase in the overall
 The net working capital increased , and it resulted in a positive working capital
for 2020-21.
ENDED 2021-22
(Rs. In thousand )

IN IN
WORKING WORKING
CAPITAL CAPITAL
CURRENT ASSETS

CURRENT LIABILITIES
Total 6487 6487 (2014) (2014)
INTERPRETATION :-

 Creditors decreased drastically , but there has been an increase in the
overall current liabilities compared to 2021.
 The net working capital increased , and it resulted in a positive working capital for
2021-22.
STATUS OF INVENTORY
The scope of inventory management concerns the balance between replenishment lead
time, carrying costs of inventory, asset management, inventory forecasting, inventory
valuation, inventory visibility, future inventory price forecasting, physical inventory,
available physical space, quality management, replenishment, returns and defective goods,
and demand forecasting. Balancing these competing requirements leads to optimal
inventory levels, which is an ongoing process as the business needs shift and react to the
wider environment.
S.NO YEAR Amount(in thousands )
1 2017-18 6360
2 2018-19 5170
3 2019-20 5335
4 2020-21 5190
5 2021-22 5335
.
INVENTORY
8000
6360
6000 5170 5335 5190 5335
4000
Amount in thousand
2000
0
2017-182018-192019-202020-212021-22
INTERPRETATION:
The above data indicates the status of the inventories of The Green Park Hotel . .In the
year 2014-15 there was hike in inventories to 9680 but it gradually reduced in 2015 and
maintained at almost same level till 2019
STATUS OF TRADE RECEIVABLES
Trade receivables are amounts billed by a business to its customers when it delivers
goods or services to them in the ordinary course of business. These billings are typically
documented on formal invoices, which are summarized in an accounts receivable aging
report. This report is commonly used by the collections staff to collect overdue
payments from customers. In the general ledger, trade receivables are recorded in a
separate accounts receivable account, and are classified as current assets on
the balance sheet if you expect to receive payment from customers within one year.
Status of Trade Receivables
S.NO YEAR AMOUNT
1 2017-18 9680
2 2018-19 6170
3 2019-20 6280
4 2020-21 9080
5 2021-22 6290
TRADE RECEIVABLES
12000
10000 9680
9080
8000
6170 6280 6290

6000
4000
2000
0
2017-18 2018-19 2019-20 2020-21 2021-22
INTERPRETATION:
The above data indicates the status of the Trade receivables of The Green Park Hotel. In the
year 2017-18 it was 9680 . But in 2018-19 it gradually decreased and in 2020 it increased to
9080 and again declined in 2021 to 6290.
STATUS OF CASH AND EQUIVALENTS
The amount of cash and cash equivalents will be reported on the balance sheet as the first
item in the listing of current assets. The change in the amount of cash and cash equivalents
during an accounting period is explained by the statement of cash flows.
s.no Year Amount (in thousands )
1 2014-15 3610
2 2015-16 (47)
3 2016-17 4615
4 2017-18 3731
5 2018-19 4620
CASH EQUIVALENTS
5000 4615 4620
4000 3610 3731
3000
2000
1000
0
2017-18 -472018- 2019-20 2020-21 2021-22
19
-1000
INTERPRETATION: The above details indicates the status of cash and cash equivalents of
The Green Park Hotel. In 2014-15 it was 3610 in 2015-16 it became negative and then again
increased and in 2019 it is 4620.
STATUS OF SHORT TERM LOANS AND ADVANCES
A loan scheduled to be repaid in less than a year . When your business doesn't qualify for a
line of credit from a bank, you might still have success in obtaining money from then in the
form of a one-time, short-term loan (less than a year) to finance your temporary working
capital needs.
Year Amount (in thousands )
1 2017-18 9165
2 2018-19 6845
3 2019-20 9925
4 2020-21 6400
5 2021-22 5405
Chart Title
12
10
INTERPRETATION: The above details indicates the status of loans and advances of The
Green Park Hotel. In 2017 it was 9165 then gradually fall of it from 2018 to 2019 and it was
increased to 9925 in 2020 but finally it decreased to 5405 in 2022.
STATUS OF CURRENT LIABILITIES
STATUS ON TRADE PAYABLES
A trade payable is an amount billed to a company by its suppliers for goods delivered to
or services consumed by the company in the ordinary course of business. These billed
amounts, if paid on credit, are entered in the accounts payable module of a company's
accounting software, after which they appear in the accounts payable aging report until
they are paid. Any amounts owed to suppliers that are immediately paid in cash are not
considered to be trade payables, since they are no longer a liability.
Status of Trade Payables
1 2017-18 7230
2 2018-19 6890
3 2019-20 NIL
4 2020-21 7530
5 2021-22 450
Amount (in thousands)
8000
7000
6000
5000
4000
3000
2000
1000
0 2017-18 2018-19 2019-20 2020-21 2021-22
amount (in thousand)
INTERPRETATION:
The above data indicates the status of trade payables of The Green Park Hotel. In 2017 it
was 7230 and it decreased to 6390 in 2018 and nil in 2019 but it was decreased to 450 in
2022.
STATUS OF OTHER CURRENT LIABILITIES
Current liabilities are a company's debts or obligations that are due within one year,
appearing on the company's balance sheet and include short term debt, accounts payable
accrued liabilities and other debt.
1 2017-18 10897
2 2018-19 9770
3 2019-20 19960
4 2020-21 10790
5 2021-22 13693
Amount (in thousands )

25000
20000
15000
10000
5000
0
2017-18 2018-19 2019-20 2020-21 2021-22
1 2 3 4 5
INTERPRETATION:
The above data indicates the status of current liabilities in The Green Park Hotel. In 2014 it
was 10897 and it is a decrease in 2015-16. It was increased to 19960 in 2016 and in the
period of 2018-20 it gradually decreased
STATUS OF SHORT TERM PROVISION
A provision can be a liability of uncertain timing or amount. A liability, in turn, is a present

obligation of the entity arising from past events, the settlement of which is expected to
result in an outflow from the entity of resources embodying economic benefits.
1 2017-18 1485
2 2018-19 2785
3 2019-20 1050
4 2020-21 1310
5 2021-22 1020
Amount (in thousands )

3000
2500
2000
1500
1000
500
0
2017-18 2018-19 2019-20 2020-21 2021-22
1 2 3 4 5
INTERPRETATION: The above data indicates the status of short term provision of The
Green Park Hotel. In 2017 it was 1485 and it was increased to 2785 in 2018. But it was
decreased to 1050 in 2019 and increased to 1310 in 2020 and decreased to 1020 in 2021.
CURRENT RATIO (Rs. In thousand)
The current ratio is a liquidity ratio that measures a company's ability to pay short-term and
long-term obligations. To gauge this ability, the current ratio considers the current total
assets of a company (both liquid and illiquid) relative to those company’s current total
liabilities.
CURRENT RATIO = CURRENT ASSETS
Table showing year wise Current Ratio (Rs. In thousands )
Year Current Assets (Rs.) Current Liabilities Current Ratio
2017-18 28815 19612 1.469
2018-19 18140 19445 0.932
2019-20 26155 21010 1.244
2020-21 24601 19630 1.253
2021-22 21650 15163 1.427

CURRENT RATIO
35000
30000
25000
20000
15000
10000
5000
0
2017-18 2018-19 2019-20 2020-21 2021-22
Current Assets (Rs.) Current Liabilities Current Ratio
Interpretation:
The above detail indicates the status of net working capital. The current ratio in all the years
is below 2:1. Which means that the company is not capable of paying their short-term
obligations .
NET WORKING CAPITAL (Rs. In thousand )
Net working capital is the aggregate amount of all current assets and current liabilities. It is
used to measure the short-term liquidity of a business, and can also be used to obtain a
general impression of the ability of company management to utilize assets in an efficient
manner.
NET WORKING CAPITAL = CURRENT ASSETS – CURRENT LIABILITIES

Year Current Assets Current Liabilities Net working
capital
2017-18 28815 19612 9203
2018-19 18140 19445 (1305)
2019-20 26155 21010 5145
2020-21 24601 19630 4971
2021-22 21650 15163 6487
NET WORKING CAPITAL

35000
30000
25000
20000
15000
10000
5000
0
2017-18 2018-19 2019-20 2020-21 2021-22
-5000
Current Assets Current Liabilities Net working capital
INTERPRETATION : The above details indicate the status of net working capital. The net
working capital was highest in 2017-18 , and decreased to a negative (1305) in the year
2018-19 after which it gradually increased from the year 2019-20 to 2021-22.
WORKING CAPITAL TURNOVER RATIO
Working capital turnover ratio indicates the velocity of the utilization of net working capital.
This ratio indicates the number of times working capital is turned over in the course of a
year. This ratio measures the efficiency with which the working capital is being used by a
firm. A higher ratio indicates effective utilization of working capital and low ratio indicates
otherwise. But a very high working capital turnover ratio is not good for any firm. Hence
care must be taken while interpretation.
𝑁𝑒𝑡 𝑆𝑎𝑙𝑒𝑠
𝑊𝑜𝑟𝑘𝑖𝑛𝑔 𝐶𝑎𝑝𝑖𝑡𝑎𝑙 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑅𝑎𝑡𝑖𝑜 =
𝑁𝑒𝑡 𝑊𝑜𝑟𝑘𝑖𝑛𝑔 𝐶𝑎𝑝𝑖𝑡𝑎𝑙
Table showing year wise working capital turnover ratio ( Rs. in thousand )
Year Net sales Net working capital Ratio in times
2017-18 17145 9203 1.86
2018-19 50175 (1305) (38.44)
2019-20 15655 5145 3.04
2020-21 57180 4971 11.50
2021-22 15600 6487 2.40

WORKING CAPITAL TURNOVER RATIO
70000
60000
50000
40000
30000
20000
10000
0
2017-18 2018-19 2019-20 2020-21 2021-22
-10000
Net sales Net working capital Ratio in times
INTERPRETATION:
The above details indicate the status of working capital turnover ratio.
The ratio of working capital turnover of 2014-15 was 1.86 and decreased to a negative of
(38.44) in 2015-16 after which it increased and was maximum in 2017-18 which is a 11.5 and
decreased again in 2018-19 to a 2.4.
Total Assets to Working Capital Ratio (Rs In thousand )
Total assets refers to the total amount of assets owned by a person or entity. Assets are
items of economic value, which are expended over time to yield a benefit for the
owner. If the owner is a business, these assets are usually recorded in the accounting
records and appear in the balance sheet of the business.
Year Total assets Net working capital Ratio
2017-18 19615 9203 2.131
2018-19 19457 (1305) (14.09)
2019-20 21009 5145 4.08
2020-21 19630 4971 3.94
2021-22 14263 6487 2.198
TOTAL ASSETS TO WORKING CAPITAL RATIO

25000
20000
15000
10000
5000
0
2017-18 2018-19 2019-20 2020-21 2021-22
-5000
Total assets Net working capital Ratio

CHAPTER-6
 Summary
 Findings
 Suggestions
 Conclusion
SUMMARY
The major purpose of the study is to analyze the working capital management of HOTEL
GREEN PARK by considering the annual report of five years (2014-19) .
Working capital is one of the most difficult financial concepts to understand for the small-
business owner. In fact, the term means a lot of different things to a lot of different people.
By definition, working capital is the amount by which current assets exceed current
liabilities. It involves the relationship between a firm‘s short term assets and its short term
liabilities.
Funds needed for short term needs for the purpose like payment of wages and other day to
day expenses are known as working capital. The goal of working capital management is to
ensure that the firm is able to continue its operation and that it has sufficient cash flow to
satisfy both maturing short term debt and upcoming operational expenses. Working capital
is primarily concerned with inventories management, receivable management, cash
management and payable management. The study involved few personal interactions with
the financial employees of the company and through observation methods. Company
annual reports were being evaluated and working capital management was being analyzed
from it. The study has shown that the liquidity position of the company isn’t that good.
Hotel Green Park , whose working capital management has been studied in this project has
been providing the hospitality service for over 25 years , with its branches in Hyderabad ,
Chennai and Vizag and provides amazing services to all its customers .
In this study, the statement of changes in working capital for a period of 5 years was
calculated and it was found that the company had a negative working capital for majority of
the years , the turnover ratios , current ratio , net working capital ratio were also calculated
where it was found that the current ratio is less 2 which depicts a poor liquidity position of
the firm , the debtors has also decreased .
FINDINGS
 There is an increase in net working capital during 2017-18, 2018-19, 2020-21. All the
years in between have a negative or decreasing working capital.
 The year 2017-18 showed the highest working capital in all the 5 year analysis of the
working capital which is Rs. 9203 thousand .
 Though there is a huge increase in cash and cash equivalents from Rs. (47)thousand
to Rs. 4615 thousand in 2018-19, there is almost the same amount of increase in
liabilities from Rs. 19445 thousand to Rs.21010 thousand , almost nullifying the cash
increase.
 During 2019-20,there was a huge increase of Rs. 19960 thousand in other current
liabilities which was nullified by the current assets of that year , thereby giving the
company a positive net working capital .
 And finally, The Green park hotel , in 2018-19 also managed to have a positive net
working capital to meet its day to day operations .
 Current ratio of the firm is less than 2:1 throughout the period under study. It
indicates that the firm is suffering with liquidity problems.
 Turnover ratios of the firm are more fluctuating. Means there is no consistency in
utilisation of resources.
 Debtors turnover ratio has decreased throughout the period under study. It indicates
poor quality of debtors.
SUGGESTIONS
The financial condition of the company is very average . To improve the condition some
major steps have to be taken:
 Utilization of assets must be appropriate and optimum.

 The company must maintain more liquid or current assets as they can be easily
converted into cash.
 Cost cut down mechanisms can be employed to reduce wastage of cash and other
assets like small inventories.
 Current liabilities should be decreased to increase the net working capital.
 Prompt and timely action should be taken by the management to improve the
imbalance in the liquidity position of the firm.
 Efficient utilization of the working capital is necessary for the betterment of
company as a whole, as well as for different departments individually.
 Firm should adopt strict receivables policy. It should look at credit worthiness of the
customers before extending credit.
CONCLUSION
It can be concluded that, the company’s performance is good till now, and is also showing
some signs of betterment. The comparative increase in financial position of The Green park
depicts the scope of improvement and growth.
The company’s liquidity position and financial status is average over the past few years. The
liquidity position is very poor , the company sure has to take up actions to improve its
current ratio . There is a lot of scope of the betterment of the company if it starts to
manage its working capital efficiently .
 Major Weaknesses of The Green Park Hotel are:

 Old plant and machinery with frequent breakdowns.
 Lack of high value orders.
 High overheads due to increased wages.
Considering all these factors, It might take some time for The Green park Hotel to get the
desired profits or rate of return. But with time it can improve with good efficiency by all its
employees and managers .
This study helped in understanding how working capital is calculated and the importance of
managing working capital of an organization .
BIBLIOGRAPHY
BOOKS :
 M.Y.Khan and P.K.Jain, Financial Management, Tata McGraw Hill publications, New
Delhi.
 N.K.Jain ,Working Capital Management , Aph Publications .
 Annual Reports
WEBSITES:
 WWW . REVENUEMANAGEMENT.COM
 WWW.PRINCIPLESOFACCOUNTING.COM
 WWW.Hotelgreenpark.com

Working Capital

Uploaded by

Copyright:

Available Formats

Working Capital

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Working Capital

Uploaded by

Copyright:

Available Formats

A study on

“WORKING CAPITAL MANAGEMENT”

Internal Examiner External Examiner

MS. BHAVANI SRI RAMYA Name & Signature

MR. M. SURYA TEJA

ANALYSIS and INTERPRETATION

SUMMARY, FINDINGS AND SUGGESTION

Working Capital is also called as “ Revolving capital ”, “ Circulating capital ”, OR “ Short-term

Working Capital = Current Assets - Current Liabilities

1.2 NEED FOR THE STUDY

 To have a knowledge about how the day to day requirements of an organization

1.4 OBJECTIVES OF THE STUDY

 To study the profile and growth of hotel industry in India.

 To study organisational profile of Green Park Hotel, Visakhapatnam

 To understand the theoretical concept of working capital.

1.5.1 PRIMARY DATA

Following are the sources of secondary data for this project :-

• ANNUAL REPORTS (YEAR ENDED :- 2017-2022)

1.6 LIMITATIONS OF THE STUDY

such as facility maintenance, direct operations (servers, housekeepers, porters, kitchen

workers, bartenders, etc.), management, marketing, and human resources.

HOTEL – THE CONCEPT

Degree programs such as hospitality management studies, a business degree, and/or

determined by hotel ownership.

GROWTH OF HOTEL INDUSTRY

The Popular Groups of Hotels in India are listed below:

WELCOME GROUP’S HOTEL IN VISAKHAPATNAM

“HOTEL DASPALLA” IN VISAKHAPATNAM

“HOTEL DOLPHIN” IN VISAKHAPATNAM

“HOTEL NOVOTEL” IN VISAKHAPATNAM

Slotting between the mercury and Pullman brands.

Novotel has over 470 hotel And resorts in 61 countries.

GREEN PARK INTRODUCTION

The 4 G’s are

 Guest is our god.

 Proper systems, proper people, Proper training

4. To foster intellectual capital:

a) To foster a nurturing work environment

GREEN PARK hotel

The Address of the Hotel is

Total Rooms: 110

Hotel Ratings: 4 star

Hotel Type : Business and Leisure Hotel

FACILITIES AT THE GREEN PARK HOTEL VIZAG :-

Department of HRD, G&A, Stores purchase, Housekeeping, Laundry, Locker, time-office,

Area Conference /theatre Reception Banquet

Chancery 2,550 300 240 100

Business Club Lounge 4th

 Once Upon a Time - Buffet & Midnight Biryani.

 Chancery - The largest with a capacity of 300 people

Chairman Mr. G. Harischandra Reddy

Vice Chairman Mr. G.V. Prasad

Executive Director Mrs. A. Parvathy Reddy

Director Mr. K.V. Ravindra Reddy

Director Mr. G. Harischandra Prasad

Director (Chairaman - Dr.Reddy’s Labs Ltd) Mr. K. Satish Reddy

Director Mrs. G. Anuradha Reddy

Director Mrs. G. Shyamala

Chief Executive Officer (CEO) Mr. B. Gautam