International Journal of Trend in Scientific Research and Development (IJTSRD) Volume 5 Issue 5, July-August 2021 Available Online: www.ijtsrd.com e-ISSN: 2456 – 6470
A Study on Funds Flow Statement Esapathi Saiparimala1, Dr. B. C. Lakshmanna2 1
Student, 2M.A, L.L.M, M.B.A, PhD, 1,2 JNTUA School of Management Studies, Anantapur, Andhra Pradesh, India
ABSTRACT Fund flow statement is a statement showing sources and application of funds for a period of time. • Fund flow statement is one of the valuable tool in the hand of management to evaluate the uses of funds by the organisation and in determining as to how these uses are financed. • Fund flow statement is statement which discloses the analytical information about the different sources of fund and the application of the same in the specific accounting cycle. • In other words, it incorporates those transactions which change either the amount of current assets or current liabilities (in the form of increased or decreased working capital) or fixed assets, long-term loans and equity capital. • Fund flow statement is also called the 'Statement of Sources and Application of Fund 'Movement Funds Statement’. • Fund flow statement attempts at providing a link in the completion of final statements. • Fund flow statement is a statement in summary form that indicates the changes occurring in items of financial condition between two different balance sheet dates. KEYWORDS: working capital, funds from operations, Adjusted profit and loss, statement of sources and applications
How to cite this paper: Esapathi Saiparimala | Dr. B. C. Lakshmanna "A Study on Funds Flow Statement" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456IJTSRD45199 6470, Volume-5 | Issue-5, August 2021, pp.1789-1795, URL: www.ijtsrd.com/papers/ijtsrd45199.pdf Copyright © 2021 by author (s) and International Journal of Trend in Scientific Research and Development Journal. This is an Open Access article distributed under the terms of the Creative Commons Attribution License (CC BY 4.0) (http://creativecommons.org/licenses/by/4.0)
INTRODUCTION The funds flow statement is a report on the movement of funds. It explains how working capital raised and used during an accounting period. “A statement showing the sources and applications of the funds known as Funds Flow statement .” “A statement of sources and applications of funds is a technical device designed to analyse the changes in the financial condition of a business enterprise between two dates”. Need for the study The study helps to know the inflows and outflows of funds at Anantha PVC Pipes Pvt ltd. Scope of the study The study on funds flow statement at Anantha PVC pipes pvt ltd is for the period of 5 years i.e., from 2015-2020.
Objectives of the study To study the changes in working capital of Anantha pvc pipes pvt Ltd, Anantapuramu. To analyze the funds from operations in Anantha pvc pipes pvt Ltd, Anantapuramu. To know the sources and applications of funds in Anantha pvc pipes pvt Ltd. Research methodology SECONDARY DATA: The study is based on secondary data. It was collected from the company annual reports, websites and journals. Limitations The study is limited to Anantha PVC pipes pvt Ltd, Hampapuramu, Anantapuramu. This study is limited to the 5 years data i.e., from 2015-2016 to2019- 2020.
@ IJTSRD | Unique Paper ID – IJTSRD45199 | Volume – 5 | Issue – 5 | Jul-Aug 2021
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International Journal of Trend in Scientific Research and Development @ www.ijtsrd.com eISSN: 2456-6470
Statement showing changes in working capital for the year ended 31st march 2016(in crores)
STATEMENT OF SOURCES AND APPLICATIONS OF FUNDS FOR THE PERIOD 2015-16
ADJUSTED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 2016
Interpretation: The working capital of 2016 increased to the extent of Rs.2.153(in crores) than in 2015. In the year 2015-16 trading profit of Rs.3.074 (in Crores).
Interpretation: In the year 2015-2016 the flows of funds were contributed by increase in working capital fixed assets, and loans. The total circulation of funds is Rs.9.877 Crores.
@ IJTSRD | Unique Paper ID – IJTSRD45199 | Volume – 5 | Issue – 5 | Jul-Aug 2021
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International Journal of Trend in Scientific Research and Development @ www.ijtsrd.com eISSN: 2456-6470
Statement showing changes in working capital As on 31st march 2017(in crores)
STATEMENT OF SOURCES AND APPLICATIONS OF FUNDS FOR THE PERIOD 2016-2017
ADJUSTED PROFIT AN D LOSS ACCOUNT FOR THE YEAR ENDED 2017
Interpretation: The working capital of 2017 has decreased to Rs.25.699(in crores).In the year 2016-2017 trading profit is Rs.15.786(in crores).
Interpretation: In the year 2016-2017 the flow of funds were contributed by decrease in working capital, fixed assets, and loans. The total circulation of funds is Rs.25.699 crores.
@ IJTSRD | Unique Paper ID – IJTSRD45199 | Volume – 5 | Issue – 5 | Jul-Aug 2021
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International Journal of Trend in Scientific Research and Development @ www.ijtsrd.com eISSN: 2456-6470
Statement showing changes in working capital As on 31st march 2018 (in crores)
ADJUSTED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 2018 Interpretation: In the year of 2017-2018 the funds were increased in working capital, fixed assets. The total circulation of funds is Rs.171.490(in crores). Statement showing changes in working capital As on 31st march 2019 (in crores)
Interpretation: The working capital of 2018 has increased to Rs.44.001(in crores).In the year 2017-18 trading profit is Rs.35.700(in crores). STATEMENT OF SOURCES AND APPLICATIONS OF FUNDS FOR THE PERIOD (2017-2018)
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International Journal of Trend in Scientific Research and Development @ www.ijtsrd.com eISSN: 2456-6470
ADJUSTED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 2019
Interpretation: In the year 2018-19 the flows of funds were contributed by Increase in working capital, fixed assets, loans. the circulation of funds is Rs. 78.721 crores. Statement showing changes in working capital As on 31st march 2020 (in crores)
Interpretation: The working capital of 2018 has also increased to Rs.17.834(in Crores). than in 2017.In the year 20172018 trading profit of Rs.35.248(in crores). STATEMENT OF SOURCES AND APPLICATIONS OF FUNDS FOR THE PERIOD (2018-2019)
ADJUSTED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 2020
Interpretation: The working capital of 2020 has increased Rs.13.042(in crores) than in 2019. In the year 20192020 Trading profit is Rs.14.791 (in Crores).
@ IJTSRD | Unique Paper ID – IJTSRD45199 | Volume – 5 | Issue – 5 | Jul-Aug 2021
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International Journal of Trend in Scientific Research and Development @ www.ijtsrd.com eISSN: 2456-6470
STATEMENT OF SOURCES AND APPLICATIONS OF FUNDS FOR THE PERIOD (2019-2020)
Interpretation: In the 2015-2016, it decreases in the Working capital then it increase in the year 2017-2018 and again increase in the year 2018-2019. FUNDS FROM OPERATIONS
Interpretation: In the year 2019-20 the flows of funds were contributed by increase in working capital. The circulation of funds is Rs.79.604 (in crores). Statement showing changes in working capital:
Interpretation: This chart represent funds from operations in the year 2015-16 increasing the funds from operations then decreasing and again increasing in the year 2019-20. Findings In the year 2015-16 the flows of funds were contributed by increase in working capital, fixed assets, and loans. The circulation of funds in Rs. 9.877crores. In the year 2016-17 the flows of funds were contributed by decrease in working capital, fixed assets, loans. The circulation of funds is Rs. 25.699 crores. In the year 2017-18 the flows of funds were contributed by increase in working capital, fixed
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International Journal of Trend in Scientific Research and Development @ www.ijtsrd.com eISSN: 2456-6470
assets, loans. The circulation of funds is Rs. 171.490 crores.
operations is in loss. It generated in application of total funds.
In the year 2018-19 the flows of funds were contributed by increase in working capital, fixed assets, loans. The circulation of funds is Rs.78.721 crores.
SUGGESTIONS It can be suggested that better utilization of sources of funds for getting maximum benefits. It can be suggested that efficient of assets utilization for revenue generation.
In the year 2019-20 the flows of funds were contributed by increase in working capital, fixed assets, loans. The circulation of funds is Rs.79.604crores. Conclusion Funds were utilized for financing the working capital requirements. The study revealed the trend of applications and sources of funds in respect of secured and unsecured loans. Except of the first year the study period it is observed that the funds from
Steps should be initiated in order to cut down the expenses of the company which are found to the maximum in all the years of study Reference: [1] M.Y. Khan and P.K. Jain : Financial Management [2]
Prasanna Chandra : Financial Management
[3]
I.M. Pandey : Financial Management
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