Accounts Knowledge Hub - Page 4 of 47 - Finance, Taxation and All Statutory Information For Everyone

How to incorporate limited liability partnership

Corporate Law

Sunil Bhave

-

June 22, 2018

STEP WISE PROCEDURE.: for Incorporate Limited Liability Partnership

In 2008, Ministry of Corporate Affairs brought the concept of Limited Liability Partnership.
As per the LLP Act 2008 an “LLP is defined as that business entity where having two Designated Partners is minimum requirement and such partners had their liability limited to their contribution towards the LLP
It has following below mentioned features.

1. Separate Legal entity

2. Have perpetual succession

3. Formation cost is nominal.

4. Unlimited numbers of partner.

5. Less compliance as compare to the Company.

STEP INVOLVED:

1. Obtain DPIN of all the designated partner.
2. Apply for Digital Signature Certificate of partner/designated partner of LLP/Proposed LLP.
3. File LLP 1 for Reservation of name.

Firstly download LLP 1 and start filling the details like details of applicant whether applicant is a individual or nominee of a body corporate. Enter the Designated partner identification number (DPIN) and click on prefill button. Enter the details of two proposed designated partners (One of them should be a resident in India) and mention other details too. In PART C Select name of the proposed LLP (upto 6 choices can be indicated). State the significance of the key or coined word in the proposed name in brief. Affix the s digital signature of Designated partner and file the form and pay requisite fee to MCA.

Once the name is reserved by registrar. Come on to next step:

4. Then start proceed to file LLP Form No-2 which is for “INCORPORATION OF DOCUMENT AND STATEMENT”
In LLP form -2 start fill the details like Address of registered office of the LLP, Business activities to be carried out by the LLP. Total number of designated partner, total number of partners. Mention their respective details. Total Monetary contribution and Attached Proof of address of registered office of LLP and subscribers sheet including consent. After filing the details Statement in the eform is to be digitally signed by a person named in the incorporation document as a designated partner having permanent DPIN and also digitally signed by professional.

On Submission of the form , maximum within 14 days of filing of E-form 2, Registrar will issue certificate of incorporation in Form 16.

5. DRAFT LLP AGREEMENT AND FILE FORM 3 (LLP AGREEMENT FORM).
Once Form-3 got approval, all the formalities in respect of incorporation of Limited Liability partnership is been completed.

How to prepare Bank Loan project report

Finance

Sunil Bhave

-

June 20, 2018

0

Project Report for Bank Loan:

Basic Information required:

What is the nature of Business: Manufacturing, Trading, Service, Professional

What is the Constitution of Business: Proprietorship, Partnership Firm, Pvt. Ltd. Co. Public Ltd. Co, Trust etc.

Existence: Whether the business is already existing or new. Depending upon the above parameters, project reports vary. Depending upon the nature of business, the requirements differ, depending upon constitution of business the Tax related issues differ and depending upon existence of the business, the projections differ. In case of existing business the projections can be prepared on the basis of past data, in case of new business such information is not readily available and projections are to be made by collecting relevant data from the prospective entrepreneur and also from the financial statements of similar business operating in the area. In case of new units, the projections are to be supported with proper data and the presumptions on which the projections are made.
Requirement: Requirement of any business are of two types : Capital Cost and Working capital. Capital cost includes creation of additional “Fixed Assets” i.e. Building, Machinery, Furniture, Vehicle etc. Working Capital is funds required for efficiently running any business. Generally for capital cost Banks sanction Term Loan which is repayable in installments. Working capital requirement is provided by Banks by way of Cash Credit or Overdraft facility with sub limits for Bills Discounting. Cash Credit / Overdraft / Bill discounting facilities are sanctioned for a period of one year subject to renew every year depending upon past performance. Besides this, Banks also sanction Non Fund based Limits for Bank Guarantees and Letters of Credit under which limits are fixed and these are considered as Contingent Liabilities in Banks books.

Project Cost: Once the above basic information is collected next step is to arrive at the Project cost. Project Cost in case of existing business is the “Additional Cost” required for expansion of the business e.g. purchase of additional Machinery, Construction of shed / building etc. In case of new business it is the “Total cost” required to start the new business. Ex:

Description	Estimated Cost
Purchase of Plot
Construction of Building
Plant & Machinery
Equipments
Furniture & Fixtures
Electrical Installations
Preliminary Expenses in case of new business

Total of all such items represent the Project Cost.

Sources of Funds: For incurring above expenditure, funds are to be raised through various sources. First is “Capital”e own funds, Second is “Unsecured Loans” raised from Directors of the Company or from Friends & Relatives of the Proprietor / Partners and third is “Bank Loan” which is the amount for which loan is to be requested from Bank. Generally, Banks finance maximum 75% of the “actual cost” required, remaining amount is to be contributed by the applicant through first two methods out of which capital must be more than unsecured loan. The unsecured loans raised by the applicant should not be immediately repayable for which undertaking has to be submitted stating that, the unsecured loans raised shall not be repaid during the currency of Bank Loan. This can be treated as Quasi Equity i.e. part of borrower’s contribution. On finalizing the available sources of funds, the loan amount requirement from Bank can be finalized. In case of Working capital requirement it depends upon the Current Assets and Current Liabilities of the business / business cycle etc.

Requirement of other information / documents:

Xerox copies of all the required permissions / licenses / registrations e.g. Company / Partnership Firm / Trust registration i.e. identity of the business, Registration under Shops & Establishments Act, SSI Registration or any other registration as per applicable rules in the respective states. License from Foods & Drugs Deptt. In case of eatable items, license related to explosives, license from Pollution Control Board etc. Approved Map and construction permission in case of construction of building / shed. GST registration, PAN card
Quotations for the items to be purchased preferably from the actual dealer from whom the items are to be purchased. As far as possible, there should not be much variations in quotations submitted to Bank and dealers from whom the items are purchased.
Income tax returns of the persons / business for last 3 years.
Bank statements from existing bankers, with details of repayment schedule in case of existing loans if any.
Details of Collateral Security proposed to be offered with approximate value.
List of prospective customers and arrangements for selling.
List of prospective sellers from whom raw material / items will be purchased.
Information regarding availability of raw materials / items proposed to be dealt with Govt. restrictions if any particularly in case of imported material.
Market study report and strategy to be adopted for achieving the projected levels particularly in case of new business.
Assets / Liabilities statements of persons who are going to execute the documents.
List of assets available / already purchased with copies of invoices.
Availability of infrastructure i.e. Labour, Water, Electricity, transportation with details of requirement and sources.
Average period of getting Credit for raw material and minimum economic quantity of purchase, average period of realizing sale proceeds.
Detailed manufacturing process in case of Manufacturing industry and time taken for completion of one production cycle.
Minimum period of keeping stock of raw material and finished goods.

Detailed Project Report: This is in two parts one is brief write up and second is financial data (CMA Report) CMA stands for Credit Monitoring Arrangement wherein the past and projected financial performance of a business is compiled in a defined format with all the required financial metrics and ratios to help Bankers and Financial Analysts ascertain the financial health of a business.

In the first part following points are to be covered: (This is should be in brief covering all the important points: e.g.

Brief introduction of the business entity – constitution, activity of the business, name(s) of Proprietor, Partners, Directors, Trustees with their designations and their role in the business, Location / Address of the Regd. Office, working place and outlets where activities of the business will be carried out with name of contact persons and contact numbers.
Experience / Qualifications and capabilities of the owners and other related persons with their relations with the business.
Nature of Activity and its marketability.
Availability of Infrastructure like labour, water, electricity, transportation, raw material and present status.
Detailed information regarding various registrations, permissions, licenses with present status and expected time of completion in case of incomplete items.
Manufacturing process in brief in case of manufacturing units.
Time required for completion of the project and starting commercial production / income generation.
List of existing Debtors / Creditors in case of existing business and prospective clients / consumers in case of new business.
SWOT analysis of the business.
Marketing arrangements.
Details of Project cost and existing assets with sources of finance.
Present Banking arrangements with details of Accounts maintained.
Details of any other services which the unit can avail from the Bank e.g. Staff accounts for salary, personal loans for staff guaranteed by the unit etc.
Financial requirement from Bank with purpose.
Security proposed to be offered for the loan applied with full details and approximate value.
Repayment proposed by the applicant based on the CMA data with proposed moratorium period.
Any other relevant information may be included depending upon the business at appropriate place in this report.
Request for facility wise sanction of loan..
Attach list of documents submitted along with the proposal.

Second part consists of CMA data: In CMA data there are different parts:

In case of existing units, the data should be for current year (estimated) and past 3 years (Audited) and projections for next 5 to 7 years covering the proposed repayment period of Term loan.

Operating statement – Profitability statement. In CMA data the expenses are mainly grouped into following categories:
Raw Material consumed. (Opening stock + Purchases – Closing Stock)
Other Spares
Electricity / Power / Fuel
Factory / Direct wages
Repairs & Maintenance
Other overheads

Total of the above expenses plus opening stock of Stock in process and Finished goods Less closing stock of Stock in process and Finished goods is the “Total Cost of Sales”.

All other office expenses and indirect expenses related to business excluding Interest paid on Bank loan (which is shown separately- for Cash Credit and for Term Loan) are clubbed under the head “ Selling, General &Administrative Expenses”.

Non operating Income and Expenses are to be shown separately in the CMA data. Detailed format of “Operating Statement” generally required by Banks for CMA data is attached for reference.

Balance Sheet – Liabilities: Include following heads

Current Liabilities:

Short Term borrowings from “Banks” with sub limit for Bills Discounting.
Short Term borrowings from “others”.
Sundry Creditors (Trade)
Sundry Creditors (Capital Expenditure)
Advance payment from Customers, dealers.
Provision for taxation.
Dividend payable in case of Companies.
Other Statutory liabilities payable within one year.
Term Loan installments payable within one year are to be treated as Current Liabilities.
Other Current Liabilities and provisions to be specified.
Term Liabilities:
Part of Term Loan excluding amount payable within one year.
Other Term liabilities (Not payable within next one year.)
Unsecured Loans not repayable in next one year.

Total of Current Liabilities and Term Liabilities represent “Total Outside Liabilities”.

Net Worth: It includes:

Capital invested in the business.
Reserves & Surplus in case of Companies
Surplus / Deficit in Profit & Loss Account.

Sum of Current Liabilities, Term Liabilities and Net Worth is “Total Liabilities”

Balance Sheet : Assets: includes following heads.

Current Assets:

Cash & Bank Balances excluding Term Deposits in Banks
Investments in Govt. Securities
Investment in Bank Deposits
Receivables
Expenses receivable including Bills purchased and discounted by Banks.
Inventory which includes Stock of Raw Material, Spares, Stock in Process and Finished Goods.
Advance to suppliers for supply of Raw Materials and Spares.
Advance payment of Taxes
Other Current assets to be specified.

Sum of the above items represent “Total Current Assets”

Fixed Assets:

Gross Block of Fixed Assets Less Depreciation up to date i.e Net Block. (With detailed working of Depreciation)
Advance for Capital Expenditure
Other investments which are not “Current Assets”
Investments in Associates & Subsidiaries.
Long term loans & advances
Security Deposits.
Staff advances
Obsolete Stock
Other non-current assets to be specified.
Preliminary Expenses to the extent of Not written off and other intangible assets.

Sum of Current Assets and Fixed Assets is “Total Assets”

Total Liabilities = Total Assets (to be checked)

Ratio Analysis & Assessment of Bank Finance:

From the available and projected financial statements, important ratios are to be calculated which include :

LIQUIDITY RATIOS

Current Ratio

Quick Ratio or Acid test Ratio

Absolute Cash Ratio

Interval Measure

CAPITAL STRUCTRE RATIOS

Equity to Total Funds Ratios

Debt Equity Ratio

Capital Gearing Ratio

Fixed Asset to Long Term Fund Ratio

Proprietary Ratios

COVERAGE RATIOS

Debt Service Coverage Ratio

Interest Coverage Ratio

Preference Dividend Coverage Ratio

TURNOVER RATIOS

Capital Turnover Ratio

Fixed Asset Turnover Ratio

Working Capital Turnover Ratio

Finished Goods or Stock Turnover ratio

WIP Turnover Ratio

Debtors Turnover ratio

Creditors Turnover ratio

PROFITABILITY RATOS BASED ON SALES

Gross Profit ratio

Operating profit Ratio

Net profit Ratio

Contribution Sales Ratio

PROFITABILITY RATOS OWNERS VIEW POINT

Return on investment (ROI) or return on capital employed

Return on Equity

Earnings Per Share

Dividend Per Share

Return On Assets

Cash Flow statement.
Sensitivity analysis

Working Capital assessment:

Term loan component depends upon the “Project Cost”, but Assessment of Working Capital i.e. Cash Credit / Overdraft limit depends upon various parameters and calculated based on various methods of assessment of Working Capital, which is mainly related to Current Assets and Current Liabilities. It is outcome of two variables:

The Volume of Activity : Production and Sales
Required level of Current Assets (Inventory and Receivables) to enable the unit to carry on operations smoothly.

Sources of Working Capital include:

Own Funds
Bank Borrowings
Sundry Creditors
Advances from Customers
Deposits due in one year
Other Current Liabilities

Following are various methods of assessment of Working Capital:

Operating Cycle Method
Traditional Method
Projected Balance Sheet Method
Cash Budget Method
Projected Annual Turnover Method (Nayak Committee)

SEGMENT	LIMITS (Rs. Cr)	SUGGESTED METHOD
SSI	Upto 5	Traditional & Nayak Committee (PAT)
SSI	Above 5	Project Balance Sheet Method
SBF	All loans	Traditional & Nayak Committee (PAT)
Trade & Services	Upto 1	Traditional & Nayak Committee (PAT)
	Above 1 upto 5	Projected Balance Sheet & Nayak Committee (PAT)
	Above 5	Projected Balance Sheet
C & I Industrial	Below 0.25	Traditional & Nayak Committee (PAT)
	Above 0.25 & over upto 5	Projected Balance Sheet & Nayak Committee (PAT)
	Above 5	Projected Balance Sheet

Operating Cycle Method:

Time taken between cash outlay (investment) and cash realization through sale of finished goods and realization of receivables is known as “Operating Cycle”

For Example:

Time taken for different activities is as under:

Stock of Raw Material in days 60
Stock in Process in days 10
Stock of Finished Goods in days 20
Bills Receivable in days 30

Length of Operating Cycle 120 Days

(i.e. 3 Cycles in a year (365/120)

Measuring Period for Working Capital components:

Raw Material holding period = Stock of R.M. *365 / Annual consumption of Raw Material.
Stock in Process holding period = Stock in Process * 365 / Cost of Production.
Finished Goods holding period = Finished Goods level * 365 / Cost of Sales.
Receivables holding period = Receivables * 365 / Annual Gross Sales
Advances paid to suppliers period = Advances paid * 365 / Annual purchases.
Trade Creditors holding period = Trade Creditors level * 365 / Annual purchases.
Advances received against Sales period = Advances received * 365 / Annual Gross sales.

If Sales of the business are Rs. 2,00,000.00 and operating Expenses are Rs. 1,80,000.00, then the Working Capital required will be Rs. 60,000.00.

(1,80,000 / 3 – Number of cycles in a year)

As per this method Working Capital required is influenced by two factors:

Level of Operating Expenses
Length of Operating Cycle.

Reduction in either will bring down Working Capital Requirement which indicates improved efficiency in Working Capital Management.

Traditional Method:

For example: for unit XYZ: (Amount in lakhs)

Anticipated Monthly Sales Rs. 200.00

Cost of Raw Material per month Rs. 150.00

Cost of Production per month Rs. 190.00

Item	Stocking period	WC required	Margin (%)	Amt	Permissible Limit
1	2	3	4	5 *(3 4)**	6 (3 – 5)
Raw Material	30 Days	150	25%	37	113
Work in process	15 Days	95	25%	24	71
Finished Goods	15 Days	95	25%	24	71
Receivable	30 Days	190 (Cost of Production)	33% of Sale Price)	66	134 (Sale Price – Margin)
Expenses	30 Days	40	100%	40	–
Total		570		191	389 (a)
Less: Advance Payment		30
Credit on purchase		80
Working Capital Required		460

If Liquid surplus in Balance Sheet at the end of last year = 50, Net Deficit = 410 (b) (460 Minus 50).

Eligible Working Capital limit under traditional method minimum of a & b = 389 say 390

Projected Balance Sheet Method:

Proper Examination of Performance:

Profitability
Financial Position
Financial Management.

Scrutiny & Validation of Projections:

Income & Expenses
Changes in Financial Positions.

Acceptability of Liquidity, overall gearing efficiency of operations:

Assessment of Working Capital under Projected Balance Sheet Method:

(Amt in lakhs)

	Previous Year	Current Year	Next Year
A Total CA	75	95	115
B Other CL	50	60	75
C Working Capital Gap (A – B)	25	35	40
D Net Working Capital (Actual / Projected)	5	10	15
E Assessed Ban Finance (ABF) (C – D)	20	25	25
NWC / TCA (%)	6.67%	10.53%	13.04%
Bank Finance / TCA (%)	26.67%	26.31%	21.74%
S. Creditor / TCA (%)	20%	21.05%	21.74%
Other CL / TCA (%)	66.66%	63.17%	65.22%
Inventory to Net Sales (days)	27	32	37
Receivable to Gross Sales (days)	73	73	73
S. Creditor / Purchases (days)	39	50	61

If

Gross Sales	200	225	250
Sundry Creditors	15	20	25
Purchases	140	145	150
Receivables	40	45	50
Inventory	15	20	25

Cash Budget Method: This is applicable in case of Seasonal and specific industries: e.g. Sugar Industry, Ginning & Pressing, Construction activity, Information & Technology etc.

Cash Flow Statement: Example

Month	1	2	3	4	5	6	7	8	9	10	11	12
Sales	540	720	360	360	100	180	300	360	360	240	240	450
Receipts	351	531	657	414	334	147	180	288	351	348	258	261
Cash Sales	54	72	36	36	10	18	30	36	36	24	24	45
Collections	297	459	621	378	324	129	150	252	315	324	234	216
Payments	383	536	633	356	317	172	221	314	381	338	254	311
To Creditors	252	378	504	252	252	70	126	210	252	252	168	168
Wages	81	108	54	54	15	27	45	54	54	36	36	68
Others	50	50	75	50	50	75	50	50	75	50	50	75
Surplus/Deficit	-32	-5	24	58	17	-25	-41	-26	-30	10	4	-50
BF Cash	10	-22	-27	-3	55	72	47	6	-20	-50	-40	-36
Cum. Cash	-22	-27	-3	55	72	47	6	-20	-50	-40	-36	-86
Cash in Hand	10	10	10	10	10	10	10	10	10	10	10	10
Cum. Surplus / Deficit	-32	-37	-13	45	62	37	-4	-30	-60	-50	-46	-96

Limit is decided based on peak deficit projected as per Cash Flow Statement.

Projected Turnover Method (Nayak Committee):

This method is applicable where FBWC limit is upto Rs. 500.00 lakh (Rs. 5.00 Crore)

Under this method Working Capital is decided as 25% of Realistic Projected Annual Turnover Less Min. 5% of turnover to be brought in by the borrowers as their contribution.

Computation under annual Turnover method.

Annual Turnover as projected by Borrower
Turnover as accepted by Bank
Working Capital Requirement (25% of B)
Minimum margin required (5% of B)
Actual Margin available (CA – CL)
Item C – item D
Item C – item E
WC Finance – F or G, whichever is less

Example:

(Amt. in lakhs)

A	Annual Turnover as projected by Borrower	1500
B	Turnover as accepted by Bank	1200
C	Working Capital Requirement (25% of B)	300
D	Minimum Margin required (5% of B)	60
E	Actual Margin Available ( CA – CL)	20
F	Item C Minus Item D	240
G	Item C Minus Item E	280
H	Working Capital Finance F or G whichever is Less	240

Non Fund based limits e.g. Letters of Credit or Bank Guarantees : Limits are to be decided based upon genuine requirement of the unit.

Format of CMA Data: Banks use individual formats of CMA data, however the information required is same. One of the formats is given below: The format may be prepared in excel sheet for easy calculations.

Operating Statement:

	PARTICULARS	Aud	Aud	Aud	Est.	Proj
	Years	2015-16	2016-17	2017-18	2018-19	2019-20
	Operating months	12	12	12	12	12
	Operating Statement
1	I. Domestic Sales
	ii. Export Sales
1	Total Gross Sales	0.00	0.00	0.00	0.00	0.00
2	Less : Excise Duty
3	Net Sales (1-2)	0.00	0.00	0.00	0.00	0.00
4	Growth in sales		0%	0%	0%	0%
	Cost of Sales
5	a. Raw Material (Imported )
	b. Raw material (Indigenous)
	c. Stores & Spares (Imported)
	d. Stores & Spares (Indigenous)
6	Power & Fuel
7	Direct Labour
8	Repairs and maintenance
9	Other Sight Expenses
10	Depreciation
11	Others expenses	0.00	0.00	0.00	0.00	0.00
a
b
c
	Sub Total	0.00	0.00	0.00	0.00	0.00
12	Add: Opening Stock in Process
	Sub Total	0.00	0.00	0.00	0.00	0.00
13	Deduct : Closing Stock in Process
	Cost of Production	0.00	0.00	0.00	0.00	0.00
14	Add: Opening Stock of Finished Goods
	Sub Total	0.00	0.00	0.00	0.00	0.00
15	Deduct : Closing Stock Of Finished Goods
	Sub Total ( Total Cost of Sales)	0.00	0.00	0.00	0.00	0.00
16	Gross profit	0.00	0.00	0.00	0.00	0.00
	Gross Profit / Sales	0.00%	0.00%	0.00%	0.00%	0.00%
17	Selling Expenses
18	Administrative Expenses
	Sub Total	0.00	0.00	0.00	0.00	0.00
19	Operating Profit before interest	0.00	0.00	0.00	0.00	0.00
	a. Interest on CC.
	b. Interest on TL
	c. Other interests
20	Total Interest	0.00	0.00	0.00	0.00	0.00
21	Operating Profit after Interest	0.00	0.00	0.00	0.00	0.00
22	Add: Other non operating Income
a	Interest/Dividend/Royalties etc..
b	commission
c	Other income
d
	Sub Total	0.00	0.00	0.00	0.00	0.00
23	Deduct other non operating expenses
a	Interest/Dividend/Royalties etc..
b	Other Expenses
c	Intangibles written off
d	Directors remuneration
e	Exchange loss
	Sub Total	0.00	0.00	0.00	0.00	0.00
24	Net of other non operating Income/Expenses	0.00	0.00	0.00	0.00	0.00
25	Profit before Tax /Loss (PBT)	0.00	0.00	0.00	0.00	0.00
26	Provision for Taxes
27	Net Profit/Loss (PAT)	0.00	0.00	0.00	0.00	0.00
28	Cash Accruals	0.00	0.00	0.00	0.00	0.00
29	Dividend paid + IT on Dividend
30	Retained Profit	0.00	0.00	0.00	0.00	0.00
31	Retained Cash Profits	0.00	0.00	0.00	0.00	0.00
32	RM Content in sales	0%	0%	0%	0%	0%
33	PBDIT	0.00	0.00	0.00	0.00	0.00
34	PBDIT/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
35	Operating Profits/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
36	PBT/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
37	PAT/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
38	Cash Accruals/ Sales	0.00%	0.00%	0.00%	0.00%	0.00%

	Interest on CC.
	Interest on TL
	Other interests

	Transfer to Reserves (if any)

	Depreciation adjustments

	ANALYSIS OF BALANCE SHEET – LIABILITIES
		Aud	Aud	Aud	Est.	Proj
		2015-16	2016-17	2017-18	2018-19	2019-20
	LIABILITIES
	Current Liabilities
1	Short Term loans from Applicant Bank including BP &BD
	Short Term loans From Other banks including BP &BD
	Sub Total (A)	0.00	0.00	0.00	0.00	0.00

2	Short Term Borrowings from Others
3	Sundry Creditors (Trade)
4	Advance Payment from Customers
5	Net Provision for Taxation (if positive)
6	Dividend Payable
7	Other Statutory Liab. (Due within one Year)
8	Overdue Term Liabilities
9	Installments of term Loan/ DPGs/ Deposits/ debentures due within next year
10	Other Current Liabilities & Provisions (due within one year)	0.00	0.00	0.00	0.00	0.00
a	Sundry creditors for expenses
b	Provisions
c	Due against Land/Plot
d	Share Application Money				0.00
11	Sub Total (B)	0.00	0.00	0.00	0.00	0.00
12	TOTAL CURRENT LIABILITIES	0.00	0.00	0.00	0.00	0.00
	TERM LIABILITIES
13	Debentures (not maturing within one Year)
14	Preference Shares (redeemable after 1 year)
14	Term Loan from Bank(Less next Year Instalments)
14	Term Loan from Other Banks/Inst. (Excl. Instal. due next Yr.)
15	Deferred Payments Credits (Excl. Instal. due next Yr.)
16	Term deposits (Excl. Instal. due next Yr.)
17	Other term Liabilities	0.00	0.00	0.00	0.00	0.00
a	Unsecured loan
b
18	TOTAL TERM LIABILITIES	0.00	0.00	0.00	0.00	0.00
19	TOTAL OF OUTSIDE LIABILITIES	0.00	0.00	0.00	0.00	0.00
	NET WORTH
20	Share Capital
21	General Reserve
22	Revaluation Reserve		0.00	0.00	0.00	0.00
23	Adjustments for previous Year costs	0.00
24	Other reserves (excluding Provisions)
25	Others	0.00	0.00	0.00	0.00	0.00
a	Share Premium/Application Account
b
c
26	Surplus (+) or deficit (-) in Profit & Loss a/c		0.00	0.00	0.00	0.00
27	NET WORTH	0.00	0.00	0.00	0.00	0.00
28	TOTAL LIABILITIES (18+24)	0.00	0.00	0.00	0.00	0.00

	ANALYSIS OF BALANCE SHEET Continued – ASSETS
		Aud	Aud	Aud	Est.	Proj
		2015-16	2016-17	2017-18	2018-19	2019-20
	ASSETS
	Current Assets
1	Cash & Bank Balances
2	Govt. & other Trustee securities
3	Fixed Deposits with Banks
4	Domestic Receivables including BP/BD
5	Export Receivables including BP/BD)
6	Deferred receivables(due within one year)
7	Imported Raw Material
8	Indigenous Raw material
9	Stock in Process	0.00	0.00	0.00	0.00	0.00
10	Finished Goods	0.00	0.00	0.00	0.00	0.00
11	imported Consumables
12	Indigenous consumables
a.	Packing Material
13	Advances to Suppliers
14	Net Advance Payment of Taxes (if positive)
15	Other Current Assets (specify major items)	0.00	0.00	0.00	0.00	0.00
a	Loans & Advances
b	Deposits with clients & others
c
d
16	TOTAL CURRENT ASSETS	0.00	0.00	0.00	0.00	0.00

	FIXED ASSETS
17	Gross Block (Land & Building Machinery
18	Add Capital expenditure in work-in-process
19	Depreciation to Date		0.00	0.00	0.00	0.00
20	Net Block	0.00	0.00	0.00	0.00	0.00
21	OTHER NON CURRENT ASSETS
a	Investments in Sub. cos./ affiliates
b	Investment in Others
c	Advance to suppliers of Capital goods & Contractors
d	Deferred Receivables(Maturing after a year)
e	Other Non-current investments
f	Non Consumable Stores & Spares
g	Long outstanding dues &Other non Current Assets /dues from Directors
h	Deposits
i
	TOTAL OTHER NON CURRENT ASSETS	0.00	0.00	0.00	0.00	0.00
22	Intangible Assets
a	Preliminary Expenses
b	Deffered Revenue expenditures
c	Other Intangibles (patents, goodwill, etc.)
d
e
23	Total Intangible Assets	0.00	0.00	0.00	0.00	0.00
24	TOTAL ASSETS	0.00	0.00	0.00	0.00	0.00

49	TANGIBLE NET WORTH (TNW)	0.00	0.00	0.00	0.00	0.00
50	NET WORKING CAPITAL (NWC)	0.00	0.00	0.00	0.00	0.00

	Movement of TNW
	Opening TNW		0.00	0.00	0.00	0.00
	Plough back of profit		0.00	0.00	0.00	0.00
	Increase in capital/reserves		0.00	0.00	0.00	0.00
	Intangibles written off		0.00	0.00	0.00	0.00
	Closing TNW	0.00	0.00	0.00	0.00	0.00
	Current Ratio	0.00	0.00	0.00	0.00	0.00
	Debt/Equity	0.00	0.00	0.00	0.00	0.00
	TOL/Equity	0.00	0.00	0.00	0.00	0.00
	Current Assets/Tangible Assets	0.00%	0.00%	0.00%	0.00%	0.00%
	ROCE (PBDIT incl. Other income/TTA)	0.00	0.00	0.00	0.00	0.00
	Inventory + Receivables as days of Net Sales	0	0	0	0	0

	ADDITIONAL INFORMATION
	a. Arrears of Depreciation
	b. Contingent Liabilities
	c. Arrears of Cumulative Dividends
	d. Gratuity Liability not Provided for
	e. Disputed Custom/Excise/ Tax Liabilities
	f. Other Liabilities not provided for

			Check Points
	Check Points	2015-16	2016-17	2017-18	2018-19	2019-20
1	Difference in Assets & Liabilities	0.00	0.00	0.00	0.00	0.00
2	Increase in cap.& reserves beyond retained profit		0.00	0.00	0.00	0.00
3	Difference in intangibles written off in balance Sheet and shown in P&L account		0.00	0.00	0.00	0.00
4	Reduction in TL is less than TL instalments plus overdues		0.00	0.00	0.00	0.00

	COMPARATIVE STATEMENT OF CURRENT ASSETS & CURRENT LIABILITIES
	WORKING CAPITAL / BANK BORROWING ASSESSMENTS
		Aud	Aud	Aud	Est.	Proj
		2015-16	2016-17	2017-18	2018-19	2019-20
A.	WORKING CAPITAL ASSESSMENT

	Stock of Imported RM -Days Consumption	0	0	0	0	0
	Stock of Indiginous RM – Days Consumption	0	0	0	0	0
	Imported Consumables – (Days Consumption)	0	0	0	0	0
	Indiginous Consumables – (Days Consumption)	0	0	0	0	0
	Stock in process- (Days of Cost of Production)	0	0	0	0	0
	Finished Goods – (Days Cost of Sales)	0	0	0	0	0

	Total Inventory	0.00	0.00	0.00	0.00	0.00
	Total Inventory/Sales (days)	0	0	0	0	0

	Domestic receivables (Days Gross dom. Sales)	0	0	0	0	0
	Export Receivables – (Days Exports)	0	0	0	0	0

	Total Receivables	0.00	0.00	0.00	0.00	0.00
	Total Receivables/Gross Sales (days)	0	0	0	0	0
	Creditors – (days Consumption)	0	0	0	0	0

	Total Current Assets	0.00	0.00	0.00	0.00	0.00
	Financed by
	Sundry Cr. % of Current Assets	0.00%	0.00%	0.00%	0.00%	0.00%
	Other Curr. Liab.% of Current Assets	0.00%	0.00%	0.00%	0.00%	0.00%
	Bank Finance % of Current Assets	0.00%	0.00%	0.00%	0.00%	0.00%
	NWC % to Current Assets	0.00%	0.00%	0.00%	0.00%	0.00%
		0.00%	0.00%	0.00%	0.00%	0.00%

	By PBS Method	2015-16	2016-17	2017-18	2018-19	2019-20
	Total Current assets	0.00	0.00	0.00	0.00	0.00
	Other Current Liabilities	0.00	0.00	0.00	0.00	0.00
	Working Capital gap	0.00	0.00	0.00	0.00	0.00
	Net Working capital	0.00	0.00	0.00	0.00	0.00
	Bank Finance	0.00	0.00	0.00	0.00	0.00

	Fund Flow Analysis	Aud	Aud	Aud	Est.	Proj
	Particulars	2015-16	2016-17	2017-18	2018-19	2019-20
1	LONG TERM SOURCES
	Profit after Tax	0.00	0.00	0.00	0.00	0.00
	Depreciation	0.00	0.00	0.00	0.00	0.00
	Intangibles written off	0.00	0.00	0.00	0.00	0.00
	Increase in capital and reserves	0.00	0.00	0.00	0.00	0.00
	Increase in Term Liability	0.00	0.00	0.00	0.00	0.00
	i. Decrease in Fixed Assets	0.00	0.00	0.00	0.00	0.00
	ii. Decrease in Other non current assets	0.00	0.00	0.00	0.00	0.00
	Total Long Term Sources	0.00	0.00	0.00	0.00	0.00
2	LONG TERM USES
	Net Loss	0.00	0.00	0.00	0.00	0.00
	Increase in Intangibles	0.00	0.00	0.00	0.00	0.00
	Decrease in Capital .and Reserves/ Share Buybacks	0.00	0.00	0.00	0.00	0.00
	Decrease in Term Liabilities	0.00	0.00	0.00	0.00	0.00
	i. Increase in Fixed Assets	0.00	0.00	0.00	0.00	0.00
	Increase in non-Current Assets	0.00	0.00	0.00	0.00	0.00
	iii. Increase in Intangibles
	Dividend paid	0.00	0.00	0.00	0.00	0.00
	Total Long Term Uses	0.00	0.00	0.00	0.00	0.00
	Surplus/ Deficit	0.00	0.00	0.00	0.00	0.00
	Short Term Sources
	Increase in Bank Borrowings	0.00	0.00	0.00	0.00	0.00
	Increase in other Current Liabilities	0.00	0.00	0.00	0.00	0.00
	Decrease in Inventory	0.00	0.00	0.00	0.00	0.00
	Decrease in Receivables	0.00	0.00	0.00	0.00	0.00
	Decrease in Cash/Deposits/Govt Sec.	0.00	0.00	0.00	0.00	0.00
	Decrease in Other Current Assets	0.00	0.00	0.00	0.00	0.00
	Total Short Term Sources	0.00	0.00	0.00	0.00	0.00
	Short Term Uses
	Increase in Inventory	0.00	0.00	0.00	0.00	0.00
	Increase in Receivables	0.00	0.00	0.00	0.00	0.00
	Increase in Cash/Deposits/Govt Sec.	0.00	0.00	0.00	0.00	0.00
	Increase in Other Current Assets	0.00	0.00	0.00	0.00	0.00
	Decrease in Other Current Liab.	0.00	0.00	0.00	0.00	0.00
	Decrease in Bank Borrowings	0.00	0.00	0.00	0.00	0.00
	Total Short Term Uses	0.00	0.00	0.00	0.00	0.00
	Summary of fund Flow Analysis
	Long Term Sources	0.00	0.00	0.00	0.00	0.00
	Long Term Uses	0.00	0.00	0.00	0.00	0.00
	Surplus /Deficit (i-ii)	0.00	0.00	0.00	0.00	0.00
	Short term sources	0.00	0.00	0.00	0.00	0.00
	Short term uses	0.00	0.00	0.00	0.00	0.00
	Surplus /Deficit (iii-iv)	0.00	0.00	0.00	0.00	0.00

CALCULATION OF BREAK EVEN LEVELS
		Variable	Aud	Aud	Aud	Est.	Proj
	Particulars	%	2015-16	2016-17	2017-18	2018-19	2019-20
	BREAK EVEN POINT
	Sales		0.00	0.00	0.00	0.00	0.00
	Variable Cost
	I. Raw Material	100.00%	0.00	0.00	0.00	0.00	0.00
	ii. Consumables	100.00%	0.00	0.00	0.00	0.00	0.00
	iii. Direct Labour	60.00%	0.00	0.00	0.00	0.00	0.00
	iv. Power & Fuel	60.00%	0.00	0.00	0.00	0.00	0.00
	v. Selling Expenses	20.00%	0.00	0.00	0.00	0.00	0.00
	vi. Other Variable Costs
	Total Variable Costs		0.00	0.00	0.00	0.00	0.00
	Percent of Sales		0%	0%	0%	0%	0%

	Fixed Costs		0.00	0.00	0.00	0.00	0.00

	Break Even Level of Sales		0.00	0.00	0.00	0.00	0.00
	Percentage to Sales		0%	0%	0%	0%	0%

	Cash Break Even of Sales		0.00	0.00	0.00	0.00	0.00
			0%	0%	0%	0%	0%

	Sensitivity to BEP
	When sales go down
	Sales (when down by)	5%	0.00	0.00	0.00	0.00	0.00
	Variable costs also go down by	0%	0.00	0.00	0.00	0.00	0.00
	Contribution		0.00	0.00	0.00	0.00	0.00
	Fixed Costs		0.00	0.00	0.00	0.00	0.00
	BEP		0.00	0.00	0.00	0.00	0.00
	% to Sales		0%	0%	0%	0%	0%
	Cash Break Even of Sales		0.00	0.00	0.00	0.00	0.00
	% Sales		0%	0%	0%	0%	0%

	When RM cost goes up by	5%
	% can be passed on to customer
	Sales will go up to		0.00	0.00	0.00	0.00	0.00
	Variable costs up by	5%	0.00	0.00	0.00	0.00	0.00
	Contribution		0.00	0.00	0.00	0.00	0.00
	Fixed costs		0.00	0.00	0.00	0.00	0.00
	BEP if RM cost goes up by	5%	0.00	0.00	0.00	0.00	0.00
	% to Sales		0%	0%	0%	0%	0%
	Cash Break Even of Sales		0.00	0.00	0.00	0.00	0.00
	% Sales		0%	0%	0%	0%	0%
	When Other Variable costs up by	5%
	% can be passed on to customer	0%
	Sales will go up to		0.00	0.00	0.00	0.00	0.00
	Other Variable Cost up by	5%	0.00	0.00	0.00	0.00	0.00
	Contribution		0.00	0.00	0.00	0.00	0.00
	Fixed Costs		0.00	0.00	0.00	0.00	0.00
	BEP If Variable Expn. Go up by	5%	0.00	0.00	0.00	0.00	0.00
	% Sales		0%	0%	0%	0%	0%
	Cash Break Even of Sales		0.00	0.00	0.00	0.00	0.00
	% Sales		0%	0%	0%	0%	0%

Sensitivity to DSCR
When Sales go down
Sales (when down by)	0.05	0.00	0.00	0.00	0.00	0.00
Variable costs also go down by	0.00	0.00	0.00	0.00	0.00	0.00
Fixed cost		0.00	0.00	0.00	0.00	0.00
Total cost		0.00	0.00	0.00	0.00	0.00
Operating Profits		0.00	0.00	0.00	0.00	0.00
Depreciation & non cash charges		0.00	0.00	0.00	0.00	0.00
Cash Accruals		0.00	0.00	0.00	0.00	0.00
Interest on TL		0.00	0.00	0.00	0.00	0.00
Repayments			0.00	0.00	0.00	0.00
Gross DSCR		0.00	0.00	0.00	0.00	0.00
Average Gross DSCR		0.00

When RM cost goes up by	5%
% can be passed on to customer	0%
Sales		0.00	0.00	0.00	0.00	0.00
Variable costs sales go up to		0.00	0.00	0.00	0.00	0.00
Fixed cost		0.00	0.00	0.00	0.00	0.00
Total cost		0.00	0.00	0.00	0.00	0.00
Operating Profits		0.00	0.00	0.00	0.00	0.00
Depreciation & non cash charges		0.00	0.00	0.00	0.00	0.00
Cash Accruals		0.00	0.00	0.00	0.00	0.00
Interest on TL		0.00	0.00	0.00	0.00	0.00
Repayments		0.00	0.00	0.00	0.00	0.00
Gross DSCR		0.00	0.00	0.00	0.00	0.00
Average Gross DSCR		0.00


When Variable costs go up by	5%
% can be passed on to customer	0%
Sales		0.00	0.00	0.00	0.00	0.00
Variable costs sales go up to		0.00	0.00	0.00	0.00	0.00
Fixed cost		0.00	0.00	0.00	0.00	0.00
Total cost		0.00	0.00	0.00	0.00	0.00
Operating Profits		0.00	0.00	0.00	0.00	0.00
Depreciation & non cash charges		0.00	0.00	0.00	0.00	0.00
Cash Accruals		0.00	0.00	0.00	0.00	0.00
Interest on TL		0.00	0.00	0.00	0.00	0.00
Repayments		0.00	0.00	0.00	0.00	0.00
Gross DSCR		0.00	0.00	0.00	0.00	0.00
Average Gross DSCR		0.00



Particulars	Aud	Aud	Aud	Est.	Proj
Year	2015-16	2016-17	2017-18	2018-19	2019-20
A. Balance Sheet Data
Share Capital
Share Appln. Money
Res.& Surplus Excl. Revaluation Reserve
Surplus / Deficit in P & L Account
Intangible assets
Tangible Networth (TNW)
Installment due within one year
Term Liabilities (Excl. Install)
Unsecured Loans
Capital Employed
Net Block
Non Current Assets
Current Assets (A)
Current Liabilities (B)
Net Working Capital (A – B)

B. Operational Data
Gross Sales
Less : Excise / Sales Tax
Net Sales
Refund of Sales Tax
Other Income
Mfg. Expenses
Admn. & Selling Expenses
Depreciation
Interest
Profit Before Tax (PBT)
Profit After Tax (PAT)

C. Profit Ratios
NP / NS (%)
NP / Cap. Employed (%)
Inv. Turnover (Days)
Debtors Turnover (Days)
PAT / TNW (%)
Current Ratio
DER (TTL / TNW)
DER (TOL / TNW)
DSCR.	0.00

		Aud.	Aud.	Aud.	Est.	Proj.
	Particulars	2015-16	2016-17	2017-18	2018-19	2019-20
…	RATIOS
1	Growth in Sales	0%	0%	0%	0%	0%
2	Gross profit Ratio	0.00%	0.00%	0.00%	0.00%	0.00%
3	PBDIT	0.00	0.00	0.00	0.00	0.00
4	PBDIT/sales	0.00%	0.00%	0.00%	0.00%	0.00%
5	Operating Profits/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
6	PBT/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
7	PAT/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
8	Cash Accruals/ Sales	0.00%	0.00%	0.00%	0.00%	0.00%
9	Sales/Equity	0.00	0.00	0.00	0.00	0.00
10	Sales / TTA	0.00	0.00	0.00	0.00	0.00
11	Interest Coverage (Interest/PBDIT)	0.00%	0.00%	0.00%	0.00%	0.00%
12	PBDIT / Interest (Times)	0.00	0.00	0.00	0.00	0.00
13	Deferred Debt/ Equity	0.00	0.00	0.00	0.00	0.00
14	TOL/Equity	0.00	0.00	0.00	0.00	0.00
15	Current Ratio (CA / CL)	0.00	0.00	0.00	0.00	0.00
16	Current Ratio excluding TL Installments	0.00	0.00	0.00	0.00	0.00
17	CA / TTA (%)	0.00%	0.00%	0.00%	0.00%	0.00%
18	Inventory +Receivables as days of Net Sales	0	0	0	0	0
19	Bank Borrowings/Current Assets	0.00%	0.00%	0.00%	0.00%	0.00%
20	RM content in sales	0%	0%	0%	0%	0%
21	ROCE (PBDIT incl. Other income/TTA)	0.00%	0.00%	0.00%	0.00%	0.00%

	Debt Service Coverage Ratio Calculations
	Cash accruals	0.00	0.00	0.00	0.00	0.00
	Any cash inflow (eg. sales tax deferal, subsidy )
	Interest on TL / Deferred Loans	0.00	0.00	0.00	0.00	0.00
	Repayment Obligations of TL		0.00	0.00	0.00	0.00
	Repayment of other deferred Loans
	Total Repayment	0.00	0.00	0.00	0.00	0.00

	Net Debt Service Coverage Ratio (DSCR)	0.00	0.00	0.00	0.00	0.00
	Gross Debt Service Coverage Ratio (DSCR)	0.00	0.00	0.00	0.00	0.00
	Average Net DSCR	0.00
	Average Gross DSCR	0.00

	Security Coverage Ratio
	Net Block	0.00	0.00	0.00	0.00	0.00
	Term Loan outstanding (including installments)	0.00	0.00	0.00	0.00	0.00
	Security Cover available (NB-TL/NB)	0%	0%	0%	0%	0%

	Security cover including Collateral Security
	Security Cover available ((NB+ Collateral-TL)/NB)	0%		0%	0%	0%	0%

Key Indicators	Aud	Aud	Aud	Est.	Proj
	2015-16	2016-17	2017-18	2018-19	2019-20
Net Sales	0.00	0.00	0.00	0.00	0.00
Operating Profit	0.00	0.00	0.00	0.00	0.00
(Net) Other income	0.00	0.00	0.00	0.00	0.00
PBDIT/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
PBT/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
PAT	0.00	0.00	0.00	0.00	0.00
PAT/Net Sales	0.00%	0.00%	0.00%	0.00%	0.00%
Cash Accruals	0.00	0.00	0.00	0.00	0.00
Cash Accruals/Sales	0.00%	0.00%	0.00%	0.00%	0.00%
Paid up Capital (PUC)	0.00	0.00	0.00	0.00	0.00
TNW	0.00	0.00	0.00	0.00	0.00
Adjusted TNW (TNW-Investment in associates)	0.00	0.00	0.00	0.00	0.00
TOL/TNW	0.00	0.00	0.00	0.00	0.00
TOL/Adjusted TNW	0.00	0.00	0.00	0.00	0.00
C/R	0.00	0.00	0.00	0.00	0.00
C/R excluding T/L installments due in 1 year	0.00	0.00	0.00	0.00	0.00
Net Sales / TTA (Times)	0.00	0.00	0.00	0.00	0.00
PBT/TTA (%)	0.00%	0.00%	0.00%	0.00%	0.00%
Operating costs/sales(%)	0.00%	0.00%	0.00%	0.00%	0.00%
Bank Finance / Current Assets (%)	0.00%	0.00%	0.00%	0.00%	0.00%
Inv + Rec. /N.S. (DAYS)	0	0	0	0	0
NWC / CA (%)	0.00%	0.00%	0.00%	0.00%	0.00%

NOTE:

All information in this post are for educational purpose only, some table format are not arranged

E-Way bill – Updated

Gst

Sunil Bhave

-

June 17, 2018

0

Meaning:

E-way bill is an electronic way bill for movement of goods which can be generated on the GSTN common portal. When an E-way bill is generated, a unique E-way bill number (EBN) is allocated and is available to supplier , recipient , transporter. E-way bill also be allowed to be generated or cancelled through SMS.

Condition:

Every registered person,

Movement of goods,

Consignment value> Rs.50,000.

When should an E-way bill be generated ?

In relation to a supply; or for reasons other than supply(say a return); or due to inward supply from an unregistered person, due to Job work

When to issue E-way Bill?

Before commencement of movement of goods, Furnish information relating to the said goods in Part A of FORM GST INS-01, electronically, on the common portal.

Who should Generate an eWay Bill?

Registered Person – E-way bill must be generated when there is a movement of goods of more than Rs 50,000 in value to or from a Registered Person. A Registered person or the transporter may choose to generate and carry e-way bill even if the value of goods is less than Rs 50,000.

Unregistered Persons – Unregistered persons are also required to generate e-Way Bill. However, where a supply is made by an unregistered person to a registered person, the receiver will have to ensure all the compliances are met as if they were the supplier.

Transporter – Transporters carrying goods by road, air, rail, etc. also need to generate e-Way Bill if the supplier has not generated an e-Way Bill.

Acceptance or rejection by Recipient

Actual Acceptance

The details of e-way bill generated shall be made available to the recipient, if registered, on the common portal, who shall communicate his acceptance or rejection of the consignment covered by the e-way bill.

Deemed Acceptance

Where the recipient does not communicate his acceptance or rejection within seventy two hours of the details being made available to him on the common portal, it shall be deemed that he has accepted the said details.

List of Forms:

FORM	DISCRIPTION
FORM GST EWB-01	E-WAY BILL FORM
FORM GST EWB-02	Consolidated e-way bill form to be generated by transporter.
FORM GST EWB-03	Inspection report to be filled up by proper officer.
FORM GST EWB-04	Form to upload details by transporter, if vehicle detained for more than 30 minutes.

FORM GST EWB-01

• Part A Details of consignment

• Part B Transporter / Conveyance Details

FORM GST EWB-03

• Part A Summary Report

• Part B Final Report

Table of Distance with Period

Sr. NO.	DISTANCE	VALIDITY PERIOD
1.	Less than 100 km	One day
2.	100 km or more but less than 300km	Three day
3.	300 km or more but less than 500km	Five days
4.	500 km or more but less than 1000km	Ten days
5.	1000 km or more	Fifteen days

Marginal Costing Formula

Costing

Sunil Bhave

-

June 17, 2018

0

Marginal Costing equation, profit volume ratio, Break even point, Margin of safety,cost break even point,finding the selling price, finding the profit,.

Marginal Costing

1	Marginal Costing Equation	Sales – VC = FC + Profit

2	Contribution	Sales – VC
		Profit + FC
3	Profit Volume Ratio	Contribution / Sales
	(In Marginal Costing,
	Profit = Contribution)	Change in Profit / Change in Sales
	(Profit = EBIT)	Change in Contribution / Change in Sales
		100% – VC Ratio (PV % + VC % = 100% of Sales)
4	Break Even Point	Total Revenue = Total Cost
	Break Even Point(In Rupees)	FC / PV Ratio
	Break Even Point(In Rupees)	Break Even Point * Selling Price
	Break Even Point(Quantity)	FC / Contribution p.u
	Note:	At BEP, Total Contribution = Total Fixed Cost
5	Margin Of Safety	Total Sales – Break even Sales
	Margin Of Safety(In Rupees)	Profit / PV Ratio
	Margin Of Safety(Quantity)	Profit / Contribution p.u
6	Indifference Point / Cost Break Even Point	Total Sales = Total Profits
	(In Rupees)	Difference in FC / Difference in VCR
	(In Rupees)	Difference in FC / Difference in PVR
	(In Quantity)	Difference in FC / Difference in VC p.u
	(In Quantity)	Difference in FC / Difference in Contribution p.u
7	Shut Down Point
	(In Rupees)	Avoidable FC / PV Ratio
	(In Quantity)	Avoidable FC / Contribution p.u
8	Avoidable FC	Total FC – Min Unavoidable FC

OTHERS

1	Contribution	Profit + FC
2	Sales(In Rupees)	Contribution / PV Ratio
3	Profit	Contribution – FC
4	Contribution	Sales * PVR
5	Finding the Selling Price	Total VC / VCR
6	Finding the Profit	MOS * PVR
	Note:	Always MOS + PVR = 100%

NOTES

1	VC p.u Remains Same (it Changes if units increased or decreased but not Sale Price)
2	FC p.u. Varies but remains fixed in total(FC are the Period Cost hence charged off to P & L A/c in Marginal Costing)
3	Point of Indifference
	a)Below the POI : Choose the product having lesser FC
	b)Above the POI : Choose the product having Higher FC
4	BEP% + MOS% = 100% of Sales

Format of Net Worth Certificate

Corporate Law

Sunil Bhave

-

June 17, 2018

0

NET WORTH CERTIFICATE

We hereby certify below the position of Assets & Liabilities of the person mentioned hereunder as on 31.03.18

The same has been verified from the records & other details produced before us:

Name :

PAN :

Date of Birth :

Permanent Address : Office Address:

(A) Total Value of Immoveable Property:

(This includes beneficial share owned in Land, Building, Flat, Factory, Shop, House etc.)

Nature of Property	Location with Complete Address	Value at Cost ( ` In Lacs)
Flat at
Shop
Shop
Jewellery
TOTAL

(B) Total Value of Other Assets:

(This includes Cash, Bank balance, Gold, Other Jewellery, Investment in Shares/Mutual Funds/FD’s/LIC etc, Vehicles, Capital in Business etc.)

Nature of Asset	Particulars of Asset/ Complete Description	Oty.	Value at Cost ( ` In Lacs)
PPF	PPF Investment
Shares	Shares
FDR & Bank	FDR & Bank
Capital investment
TOTAL

(C) Total Liabilities:

Borrowed From	Amount & Securities offered	Purpose	O/s as on date ( ` In Lacs)
IDBI		Housing
Deposit		Rent
		Repayment of H. Loan
TOTAL

(D) Net Worth: (A + B – C) = /- Lacs

(In words ___________________________________)

He/She is the Guarantor for various Borrowings by his/her friends / relatives / firm(s) / company(s) as detailed below:

Guaranteed to	For the Borrowings by	Purpose	Amount Guaranteed ( ` In Lacs)
		Term Loan
		Vehicles
		Cash Credit
TOTAL

For xxx ASSOCIATES

Chartered Accountants

Partner

Membership Number:

Date:

Pearls of financial wisdom

Sunil Bhave

-

May 22, 2018

0

1) Bonds are for storing wealth and equities are for creation of wealth.

2) In my opinion, the biggest asset one can have is zero debt.

3) The greatest discipline in personal finance is living below your means.

4) As Ben Carlson says, emotions cannot be back tested. That’s why past bear market always looks like opportunities and future ones scary.

5) Early financial independence and early retirement are completely different. To me, the former is a blessing and the latter is a curse.

6) Don’t think how it would have been if you’ve started 10 years ago. Start today and visualize how you would feel 10 years from now.

7) The neighborhood we live determines our life style & spending. Need to be careful in choosing one which matches our goals and personality.

8) Paying minimum balance regularly on credit card is the maximum sign that you’re getting into debt trap.

9) Many are long term investors till next bear market.

10) Don’t take aggressive bets. Take measured risk. Remember one blunder can push you back by a decade or more in terms of wealth.

11) Big money can be made through high savings, wise investing and lots of patience.

12) One sign of progress in individual investor’s portfolio is no churn or very less churn.

13) Trying to get rich fast is a foolproof way to lose what we have.

14) Losing opportunities is far better than losing money. Don’t invest in fads.

15) “Making as much money as quickly as possible” is not an investment strategy. Unfortunately for most of us that is the strategy.

16) Aggressive strategy cannot be a substitute for high savings. Save high and take moderate risk than saving less and taking high risk.

17) The day we realise not losing is as important as winning; we would stop blindly chasing returns.

18) Good periods are more than bad periods. By not timing, though we go through bad periods, do not miss even a single good period.

19) We’ll stop looking for quick money the moment we consider stocks as businesses and realise that our wealth grows in line with business growth.
20) There are periods of high returns, low returns, no returns and negative returns. We need to go through all these to get long term returns.

21) Listening to market forecasts is not only useless but can be very harmful too; if you start acting on them.

22) The hard truth is only around 3% of our population are in a position to aspire for financial independence. Don’t waste this rare privilege.

Investment Options to Retirement Money

Sunil Bhave

-

May 22, 2018

0

Majority of retired men in PSU has only handful of savings. They may not be conversant with investment options and risks associated with investing. Thus, it is of absolute importance to invest retirement money carefully. Every paisa of retirement money invested properly gives huge confidence to the family. Investment must be low on risk and must generate fixed income.
While retiring, it is advised to recall those funds/loans that was given to the family/friends and consider selling some assets, that one thinks, must be liquidated to add-up to the retirement corpus. Remember, every Rupee added to retirement corpus is very precious. Stepwise plans are elucidated below:

Step #1: Estimate Savings –Retirement Corpus
Let’s look at the total saving of a typical retired person:

Sl.	Retirement Savings	Rs./Lakh
1	Provident fund	35
2	Gratuity	12
3	Leave Encashment	5
4	Fixed Deposit	5
5	Share	3
6	Endowment plan	3
7	Cash	2
Total		65

Adding up all these savings, it amounts to Rs 65 Lakhs.

Sl.	Monthly Expenses	Rs.
1	Grocery	3200
2	Vegetables	2800
3	Milk	1000
4	Cooking Gas	500
5	Payment to Maid	2500
6	Medical Insurance Premium/Medicines	3000
7	Electricity Bill	2000
8	Water Bill	500
9	Internet Bill	1000
10	Phone Bill	1000
11	Car Wash	500
12	Society Maint. Bill	2000
13	Car Maintenance	1500
14	Car Fuel	1000
15	Car Insurance	1000
16	Property Tax	500
17	Social /Movie Expenses	2500
18	Misc. Expenses	7500
19	Income Tax	2000
Total		36000

In my example, adding all expenses, it amounts to Rs 36,000/month. [Note: These expenses have been considered just as an example. I will request my readers to tune the values and expense heads as per their needs]
Step #3: Quantify what return is necessary
In our example, retirement savings is Rs 65 Lakhs and monthly expense is Rs 36,000. In order to generate Rs 36,000 per month from savings of Rs 65 lakhs, return @ 6.65% per annum is required.
Step #4: Quantify what return is necessary

I will suggest the person to divided the retirement money into seven parts as follows:
1. Savings accounts :SBI Multi Option Deposit Scheme (MODS)Savings A/c
2. Pradhan Mantri Vaya Vandana Yojana (PMVVY)
3. Fixed Deposit (Union Bank of India/IDFC Bank /Federal Bank)
4. Post Office – Monthly Income Scheme (PO-MIS)
5. Post Office & SBI – Senior Citizen Savings Scheme (PO-SCSS, SBI-SCSS)
6. MIP offered by Mutual Funds – monthly dividend plan (MF-MIP)
7. Balanced Mutual Fund – for capital appreciation

Note : (a) Depending on fund requirement and risk appetite, one can select out of the above investment options to invest retirement money.
(b) For senior citizens, no income tax is applicable if annual income is less than Rs.3.0 lakhs. But TDS will still be deducted. In this case, while filing the income tax returns at the end of the month, income tax refund should be claimed. It is also important to keep all TDS certificate handy while

Conclusion
It is important to lock our savings. Locking savings means investing it and not keeping it free in savings account. If this is not done, the money gets spent needlessly. What I suggest here is that, one must prepare an excel sheet for self, similar to what is shown in the above graphic.
Idea of this excel sheet should be to play with the numbers. Distribute your retirement funds in such a way that your monthly income requirement is met.
The proportion of fund distribution shown in above graphics is just for an example. Depending upon ones “retirement corpus” and “expense requirements“, one must do the fund distribution to generate enough income.
For sure the returns will be less, but at least the corpus will be safe.
There is nothing more important in old age than good health and peace of mind.
Note : This article is not meant for wealthy individuals who retire very rich. For such individuals, fixed income is not a priority. They can afford to talk about investment diversification, capital appreciation, equity investment etc.

Tally ERP9 last year closing balances current year opening balances

TallyErp9

Sunil Bhave

-

April 2, 2018

0

Make change in tally.ERP9 last year closing balances current year opening balances

Option-1

First Open your company in tally Gateway of Tally Screen then change the Period (ex. 1.04.2018 to 31.03.2019). This option is useful when using same company for the next year.

Option-2

Split Your company in tally First Open your company Gateway of tally Screen Press Alt+F3—Split Company Data—Select your company-Split from (Ex.1.04.2018) Then Open new company in tally. (Note: Before splitting Select period 1.4.17 to 31.3.19)

Option-3

Export Import Option in tally First Open Your company Gateway of Tally Press Display––list of Accounts–– Press ALT+E

Export the file.

Create Newly Company Current Financial year Gateway of Tally Press Import of Data—Master

Import of Master Then Over.

See about tally ledgers (groupwise)

Tally ledger under group list

Sunil Bhave

-

April 2, 2018

0

Tally ledgers creation under group of accounts is main part of Tally ERP 9 implementation. In every implementation of Group wise Tally ledger list prepared first which affects Trading a/c, Profit and loss a/c and Balance sheet. Here is the list of ledger head and respected group of ledgers.

TRADING A/C

Ledger Name	Tally Head	Ledger Name	Tally Head

PUR.RETURNS	PURCHASE	SALE RETURN	SALES
PURCHASE	PURCHASE	SALES	SALES
CARRIEGE	DIRECT EXPENSES
FACTORY LIGHTING	DIRECT EXPENSES
FRIEGHT & CARTAGE	DIRECT EXPENSES
IMPORT DUTY	DIRECT EXPENSES
RENT (DR)	DIRECT EXPENSES
ROYALITY	DIRECT EXPENSES
WAGES	DIRECT EXPENSES

PROFIT & LOSS A/C

Ledger Name	Tally Head	Ledger Name	Tally Head

ADVERTISEMENT	INDIRECT EXPENSES	BAD DEBITOR RECOVERED	INDIRECT INCOME
BANK CHARGES	INDIRECT EXPENSES	COMMISSION RECEIVED	INDIRECT INCOME
BILL DRAWN	INDIRECT EXPENSES	DISCOUNT RECEIVED	INDIRECT INCOME
CARRIAGE	INDIRECT EXPENSES	INTREST ON DRAWING	INDIRECT INCOME
COMMISSION ALLOWED	INDIRECT EXPENSES	INTREST ON INVESTMENT	INDIRECT INCOME
DISCOUNT ALLOWED	INDIRECT EXPENSES
DONATION & CHARITY	INDIRECT EXPENSES
FREE SAMPLE	INDIRECT EXPENSES
INSURANCE PREMIUM	INDIRECT EXPENSES
INTEREST ON LOAN	INDIRECT EXPENSES
LEAGAL CHARGE	INDIRECT EXPENSES
LOSS BY FIRE	INDIRECT EXPENSES
OFFICE LIGHTING	INDIRECT EXPENSES
PETTY CASHIER	INDIRECT EXPENSES
POSTAGE & COURIER	INDIRECT EXPENSES
PRINTING & STATIONERY	INDIRECT EXPENSES
RENT (CR)	INDIRECT EXPENSES
REPAIR CHARGE	INDIRECT EXPENSES
SALARY	INDIRECT EXPENSES
SALE TAX	INDIRECT EXPENSES
SEPRECIATION	INDIRECT EXPENSES
TAXI FIRE	INDIRECT EXPENSES
TELEPHONE CHARGE	INDIRECT EXPENSES
TRADE ACCOUNT	INDIRECT EXPENSES
TRAVELLING EXPENSES	INDIRECT EXPENSES
SUSPANSE	SUSPANSE
MISSCELLANEOUS EXP.	MISSCELLANEOUS EXP.
DEPRICIATION	INDIRECT EXPENSES

BALANCE SHEET

Ledger Name	Tally Head	Ledger Name	Tally Head

CAPITAL	CAPITAL	FURNITURE	FIXED ASSET
DRAWING	CAPITAL	GOODS	FIXED ASSET
INCOME TAX	CAPITAL	LAND & BUILDING	FIXED ASSET
LIFE INSURANCE	CAPITAL	LONG TERM INVESTMENT	FIXED ASSET
RESERVES & SURPLUS	RESERVES & SURPLUS	MACHINARY & PLANT	FIXED ASSET
ADVANCE	CURRENT LIBILITIES	BANK	CASH AT BANK
BANK OVERDRAFT	CURRENT LIBILITIES	CASH	CASH IN HAND
BILL PAYABLE	CURRENT LIBILITIES	STOCK	STOCK IN HAND
OUTSTANDING EXPENSES	CURRENT LIBILITIES	DEBITOR NAME	SUNDRY DEBITOR
SALARY PAYABLE	CURRENT LIBILITIES	BAD DEBITOR	SUNDRY DEBITOR
CREDITOR NAME	SUNDRY CREDITOR	BILL RECEIVABLE	CURRENT ASSETS
LOAN	LOAN LIABILITIES	GOOD WILL	CURRENT ASSETS
BRANCH IN DIVISION	BRANCH IN DIVISION	NATIONAL PLANT	CURRENT ASSETS
ACCRUED EXPENSES	CURRENT LIBILITIES	PREPAID EXPENSES	CURRENT ASSETS
		SHORTTERM INVESTMENT	CURRENT ASSETS
		PREPAID RENT	MISC. EXP.- Asset
		LOSS ON THEFT	STOCK IN HAND
		ACCRUED INCOME	CURRENT ASSETS

Checklist for FCRA Registration

other

Sunil Bhave

-

February 27, 2018

0

SI. No	Document
1	Registration Certificate of Association.
2	Memorandum of Association/Trust Deed.
3	Activity Report for the Last 3 Years.
4	Audited Statement of accounts for the last three years.
5	12A Registration Certificate

Following Information is also required.

Sr. No.	Requirement	Details
1.	Contact details of the association such as Address, e-mail ID, Website, Landline no. etc.
2.	Contact details of the Chief functionary such as mobile no. and mail id
3.	Registration details of the Organization such as date and place of registration, PAN etc.
4.	List of Main objects and definite programmes for which the contribution is to be accepted / utilised.
5.	Details of Key functionaries of the Association such as name, nationality, contact details, relationship with other key functionaries.
6.	If the association is having any parent or sister or subsidiary organisation which is registered under the FCRA then the registration number along with Ministry of Home Affairs file number should be mentioned.
7.	If the association has submitted any application earlier than its reference number should be mentioned.
8.	If the association has received any foreign contribution with or without the prior approval of the Central Government, then the detail should be given.
9.	Details of Designated Bank Account through which the foreign contribution shall be received.
10.	Details of Utilization Bank Account through which the foreign contribution would be utilized, if any.
	The scanned image of signature of Chief Functionary and image of Seal of the Association which are saved in JPG/JPEG format are also required to be uploaded:
11.	Pan Card,Adhar Card, Mobile Number, Email Ids and occupation of Trustees
12.	Whether any key functionary is convicted for any offence?
13.	Any History of FCRA Registration?
14.	Do you have NGO – Darpan ID? If Yes, Please provide Unique ID of the same.