Balance Sheet 2017 2018 2019 2020 2021

Cost
Market Price

10 L

10 L

Butterfly Appliances
Balance Sheet 2022 2021
Asset
Non Current Asset
Cost Property, Plant Equipment
Capital Work in Progress
Intangible Asset
Intangible under Construction
Contract Asset or Right to Use the Asset
Less: Accumulated Depreciation
NCA after Depreciation
Non Operating Asset
Financial Asset
Investment in properties
 Ind AS 01.04.2017 - 31.03.2018
Rules for preparing Financial Statements

1,000,000 19955 Acres 2 Km from the cit

8,000,000 2017

Asset Value from Cost to Market Price :: Revaluation of Asset

Asset 80 L Increase

Liability
Loan OCI 70 L Other Comprehen
Capital 10 L
 - 31.03.2018
al Statements

from the city

ion of Asset

r Comprehensive Income
Deferred Tax Disclosed based on Ind AS

In India, Income Tax is to be paid in Advance. Curre

FY Apr 2021 - Mar 2022

Advance Tax will not ma

Deferred Tax = Actual Ta

Deferred Tax
Current Tax
Tax paid is not related to Efficiency or effectiveness o

Goodwill Future Income Generating Capacity

Stones Jayaram Bakery

Stones Radha Bakery

 Additional amount paid on buying a business m
Company should not account their own self g

Butterfly Appliances
Balance Sheet
Assets
Non current Asset
Cost Property, Plant & Equipment
Cost Capital Work in Progress
Cost Intangible Asset
Cost Intangible under Construction
Total Cost
Less: Depreciation
NCA after Depreciation

Non Current Investment

Financial Asset : Investments
Financial Asset : Other Fin Asset

Other Non Current Asset

 Ind AS

aid in Advance. Current Tax in FS represents Advance Tax

Profit :: Tax Advance Tax paid based on p

15 Jun, 15 Sep, 15 Dec & 15 M
15% 30% 30%
dvance Tax will not match with Actual Tax
eferred Tax = Actual Tax - Advance Tax

CA NCA CL NCL

iency or effectiveness of the operation and not considered for Ratio An

ng Capacity Valuation of Business

100 Crores Land Value

Oven, Machinery
Future Income

50 Crores Land Value

Oven, Machinery
on buying a business more than their real value of Asset
count their own self generated Goodwill

TATA Soap Hamam HUL

TATA Chemical Soda Ash

2022 2021

18,755.65 17,263.59
550.42 206.16 Under Construction; Depreciation will b
4,918.59 4,896.75
69.89 70.10
24,294.55 22,436.60
7,278.24 5,818.32
17,016.31 16,618.28 Written Down Value (WDV) :: As
In Balance Sheet, Asset will be sh

34.39 28.41
370.26 708.14 Total Revenue
Average SP
268.68 345.88 No of Units Sold

Steel, Paper, Chemical

Average SP per Ton
No of tons
id based on previous year (2020 - 21) FS
5 Dec & 15 Mar
25%

d for Ratio Analysis

Goodwill :: 50 Crores
ciation will be provided on completion

(WDV) :: Asset Value after Depreciation

set will be shown at WDV

1000 Crores
2000
50 Lakhs 100 12 240050 L / 2400 2083

8700 Crores
 Gross Block Value
Butterfly Appliances Depreciation = For
Balance Sheet
Assets
Non current Asset
Cost Property, Plant & Equipment
Cost Capital Work in Progress
Cost Intangible Asset
Cost Intangible under Construction
Total Cost
Less: Accumulated Depreciation
NCA after Depreciation

Non Current Investment

Financial Asset : Investments
Financial Asset : Other Fin Asset

Other Non Current Asset

Current Asset
Inventories
Trade Receivable
Cash & Bank Balances
Other Current Assets
 Liabilities
Equity
Other Equity

Non Current Borrowings

Borrowing + Lease Liabilities
Other Non Current Liabilities

Current Liabilities
Trade Payable
Current Borrowings
Borrowing + Lease Liabilities
Other Current Liabilities

Income Statement

Revenue from Operation

Less: Cost of Goods Sold or Direct Cost
Gross profit
Less: Employee Cost or Admin Cost
Less: Marketing Cost [Other Exp]
Operating Profit
Less: Non Operating Cost
Add: Non Operating Revenue
EBITDA
Less: Depreciation & Amortisation
EBIT
Less: Interest (Finance Cost)
EBT
Add / Less: Exceptional Item
Less: Tax
Profit After Tax
Add: Other Comprehensive Income

Retained Earnings = Other Equity

Opening Balance
Add: Current Year Profit
Less: Dividend Paid
Closing Balance
ross Block Value = Cost of the Asset
epreciation = For the Asset from the date of purchase till this Balance
Format of Balanc
2022 2021

18,755.65 17,263.59 Gross Block Value

550.42 206.16
4,918.59 4,896.75 Dividend :: As a
69.89 70.10
24,294.55 22,436.60
7,278.24 5,818.32
17,016.31 16,618.28 Written Down Value

34.39 28.41
370.26 708.14
Private Limited
268.68 345.88 Public Limited

20,969.14 17,788.11 Shares available i

9,276.74 7,436.05
1,123.76 3,736.24 Public Sector
2,751.51 2,220.54
Private Sector
51,810.79 48,881.65
 1,787.96 1,787.96
21,712.65 20,611.52

516.30 1,260.89

490.16 125.71
Private Sector & P

14,065.43 16,361.66 Private Sector

4,815.65 1,677.64
Public Limited Company
8,422.64 7,056.27

Reliance Industries
51,810.79 48,881.65

Asset Turnover Ratio will be mo

2022 2021 Asset Turnover Ratio will be less
100,530.40 86,963.81 Inventory will be available in Ple
63,347.65 50,614.29 Inventory will be available in mo
37,182.75 36,349.52 Inventory will be relatively less i
9,920.09 7,701.30
21,660.15 20,953.46
5,602.51 7,694.76 Deferred Tax = Actual Tax - Adv
 - - 300 700
194.22 158.05
5,796.73 7,852.81
1,546.49 1,555.17
4,250.24 6,297.64
1,113.44 1,462.78
3,136.80 4,834.86
660.48 - NPA Provision
863.64 1,219.05 Provision means
1,612.68 3,615.81
24.84
1,637.52

1,612.68
se till this Balance Sheet Date
Format of Balance Sheet : Schedule III of Companies Act, 2013
Ministry of Corporate Affairs
Declare NFRA
Chartered Accountant Institute

Dividend :: As a percentage on the Share Capital

AGM
1) Approval of Financial Statement
2) Approval the Dividend Payment
20% on Share Capital
10% on Share Capital
Shareholders can reduce the recommendation of Dividend by D

Lalitha Jewellery Private Limited Majority of Shareholders

Thanga Mayil Jewellery Limited General Public can buy th

Listed Company Unlisted Company

Shares available in Sharemarket Shares will not be available in S

Indian Oil Corporation or BPCL Majority of the shares are

Reliance Industries Limited Majority of the shares are

 Maximum Person
1Sole Proprietor Capital
50Partnership Firm Capital
Company More & More Capital
200Private Limited
Unlimited Public Limited

Private Sector & Public Limited

Private Sector Public Sector

Company Private Limited Company Public Limited Com

Jos Alukkas ONGC

Joy Alukkas IOC
BPCL
r Ratio will be more in Service Industry & TradingHPCL
r Ratio will be less in manufacturing Industry
be available in Plenty in Trading Industry
be available in more in Manufacturing Industry
be relatively less in Service industry

Actual Tax - Advance Tax

 1000

Non Performing Asset

Provision means expected future Loss
 Act, 2013

untant Institute

Dividend by Director

f Shareholders will be related person & General Public not allowed

ublic can buy the Shaers & Majority of shareholders will not be related

be available in Sharemarket

f the shares are held by Government or Government Company

f the shares are held by Non Government persons

 Skill
Skill

Public Sector Majority Shares held by Govt

c Limited Company Private Limited Company

General Public not allowed to hold Shares

TIDEL Park
Tamilnadu Industries Development Corporatio
ELCOT Electronic Corporation of Tamilnad
TIDEL Private Limited

Inv Turnover Ratio will be less

Inv Turnover Ratio should be more
Inv Turnover Ratio is meaningless

Company Secretary
ICSI - Institute of Company Secretaries of India
ot allowed
not be related persons

mpany
ld Shares

ent Corporation Limited TIDCO

n of Tamilnadu
Balance Sheet Year 1 Year 2 Year 3
Non Current Assets
Land & Building 20 20 20
Machinery 10 18 25
Equipments - 7 12
Vehicle 6 6 6
Total Cost 36 51 63
Less: Total Depreciation 3 8 14
NCA after Depn 33 43 49

Current Assets
Inventories - 4 8
Trade Receivables - 2 6
Bank balances 3 4 3
Cash in hand 1 2 1

37 55 67

Share Capital 5 5 5
Retained Earnings (12) (28) (34)

Non Current Borrowings 44 75 92

Current Liabilities
Trade Payables - 2 3
Outstanding Expenses - 1 1

37 55 67

Income Statement Comparing infor

Revenue 2 22 38
Less:
Cost of Goods Sold 1 12 14
Employee Benefit Cost 1 6 8
Marketing Cost 5 8 6
Other Indirect Cost 1 3 4
EBITDA (6) (7) 6
Less: Depreciation 3 5 6
EBIT (9) (12) -
Less: Interest 3 4 6
EBT (12) (16) (6)
Less: Tax - - -
EAT (12) (16) (6)

Vertical Analysis
Base should be c
Income Statement Year 1 Year 2 Year 3
Revenue 2 22 38
Less:
Cost of Goods Sold 1 12 14
Employee Benefit Cost 1 6 8
Marketing Cost 5 8 6
Other Indirect Cost 1 3 4
EBITDA (6) (7) 6
Less: Depreciation 3 5 6
EBIT (9) (12) -
Less: Interest 3 4 6
EBT (12) (16) (6)
Less: Tax - - -
EAT (12) (16) (6)
Amount in Rs. Lakhs
Year 4 Year 5 Horizontal & Vertical Analysis

20 20 Horizontal Comparing different years of Same

25 25
15 18 Vertical Comparing different information o
15 15
75 78 Horizontal & Vertical will be useful for
22 31 Income Statement
53 47

12 10
10 12
4 2
2 1

81 72

8 8
(42) (39)

109 96
 4 5
2 2

81 72
Horizontal Analysis - Comparing Various
omparing information of various year on common base
45 63 Year 2 Y2 Sale - Y1 Sale / Y1 Sale
Year 3 Y3 Sale - Y1 Sale / Y1 Sale
16 20 Year 4 Y4 Sale - Y1 Sale / Y 1 Sale
10 11
7 6 Year 2 Year 3
5 7 Sales 1000% 1800%
7 19
8 9 COGS 1100% 1300%
(1) 10 SP Increase
7 6
(8) 4
- (1)
(8) 3

ertical Analysis - Comparing within a Year different information

ase should be common mostly it is Sales
Year 4 Year 5 Year 4 Year 5 Year 4
45 63
16 20 36% 32%Y4 COGS / Y 4 Sales
10 11 22% 17%Y4 EBC / Y 4 Sales
7 6 16% 10%Y4 MC / Y4 Sales
5 7 All Cost are coming Down, which
7 19
8 9
(1) 10
7 6
(8) 4
- (1)
(8) 3
al Analysis

t years of Same Information

t information of Same year

be useful for
paring Various Year

1 Sale
1 Sale
1 Sale

Year 4 Year 5
2150% 3050%

1500% 1900%

ormation

Year 5
Y 4 Sales Y5 COGS / Y 5 Sales
4 Sales Y5 EBC / Y 5 Sales
Y5 MC / Y5 Sales
Down, which is good for the Company
Other Ratios
Interest Coverage Ratio
Earning Per Share
Debt to Total Asset
Return on Equity
Price Earning Ratio
Du Pont Analysis

Goodness of Ratios
Profitability & Turnover (Efficiency) Ratios should be hi
Debt Equity Ratio 2
Current Ratio 2
Quick Ratio 1
Lower than the above ideal ratio is good

Interest Coverage Ratio Is the company having ad

2020
EBIT 1000
Interest 30
33.33

Explains whether company is having adequate prof

Higher the Ratio is good
Earning per Share Higher the Earning
Profit After Tax 1,612.68
Number of Shares 178.79

Earning Per Share 9.02

Dividend per share 3.00
Retained Money 6.02

Retained money is reinvested in the business to incre

or Invest in Non Operating Assets to survive d

Price Earning Ratio

PE Ratio = Market Price Per Share
Earning Per Share

Market price of share in the Share Market

2020 2021 2022 2023

EPS 23.00 20.22 9.03 < 9
30???

PE Ratio 3
Return on Equity Equity == Owner's Money
Profit After Tax
Equity [Share Capital + Other Equity]

Gain what the shareholders are getting t

Debt to Total Asset Lower the Ratio is Good

Debt [Non Current Borrowings]
Total Asset [Asset Side Total]

Out of Total Asset how much is purchas

2020
Debt to Total Assets 0.40
Company is borrowing more and more and pr
This will reduce the Interest Cov
High Interest being paid

Du Pont Analysis
Combination of 3 Formula

Profitability Ratio
Net Income X
Revenue
 OA - Operating Assets
NOA - Non Operating Assets

Profitability Ratio
Net Income X
Revenue

Higher Good
Lower Bad

DuPont analysis is a financial analysis method that breaks

The DuPont analysis decomposes ROE into three parts:

1. Profit margin: The profit margin is the percentage of rev

2. Asset turnover: Asset turnover is the amount of revenue
3. Financial leverage: Financial leverage is the degree to w

By breaking down ROE into these three components, the D

ios should be higher than previous year or competitors

eal ratio is good

pany having adequate profit to cover the interest payment

2021 2022 2020 2021 2022
800 600 1,000 800 600
50 100 30 30 25
16.00 6.00 33.33 26.67 24.00

ng adequate profit to repay the Interest on the loan

 Finance Manager

her the Earning Per Share represents good

Lakhs
Lakhs

business to increase the Operating Capacity by buying more operating

sets to survive during difficult situation

Higher the Price Earning Share represents good

Dependent Variable
Independent Variable

he Share Market BSE, NSE

Expected EPS = 8.25

Market Price = Expected EXP X PE Ratio
8.25 X 3 = 24.75
Owner's Money
Dependent Variable
Equity] Independent Variable

ders are getting through the Investment in the Business

Ratio is Good
Dependent Variable
Independent Variable

much is purchased out of the money borrowed from others

2021 2022
0.60 0.70
and more and procuring the Assets
the Interest Coverage Ratio reduced
rest being paid

Asset Turnover Ratio Owner's Contribution for T

Revenue X OA + NOA
OA + NOA Equity [Share Capital + Retai
 Net Income Return on Equity
Equity

Asset Turnover Ratio Owner's Contribution for T

Revenue X OA + NOA
OA + NOA Equity [Share Capital + Retai

Utilisation of Asset is more More Borrowing - Bad

No or lesser Utilisation of Asset Low Borrowing - Good

OA + NOA = 100
Equity = 10 80
Ratio = 10 1.25

thod that breaks down the return on equity (ROE) into its component

to three parts:

percentage of revenue that remains after all expenses have been paid. I
mount of revenue a company generates relative to its assets. It measure
the degree to which a company uses debt financing. It measures how

omponents, the DuPont analysis allows investors and analysts to bette

ore operating assets
 Debt to Equity
Debt to Total Assets
Current Ratio
Quick Ratio

bution for Total Assets

pital + Retained Earnings]

bution for Total Assets

pital + Retained Earnings]

- Good

component parts. The analysis was developed by the DuPont Corpora

been paid. It measures how efficient a company is at turning its sales

s. It measures how efficiently a company is using its assets to generate
easures how much debt a company has relative to equity.

ysts to better understand the sources of a company's profitability and

uPont Corporation in the 1920s, hence its name.

rning its sales into profits.

ets to generate sales.

ofitability and how it uses its assets and debt to generate returns for its
returns for its shareholders. This analysis can be useful for comparing
for comparing the performance of different companies and for identify
nd for identifying areas of a company's operations that may need imp
may need improvement.
Butterfly Appliances Depreciation = For the Asse
Balance Sheet
Assets
Non current Asset
Property, Plant & Equipment
Capital Work in Progress
Intangible Asset
Intangible under Construction
Total Cost
Less: Accumulated Depreciation
NCA after Depreciation

Non Current Investment

Financial Asset : Investments
Financial Asset : Other Fin Asset

Other Non Current Asset

Current Asset
Inventories
Trade Receivable
Cash & Bank Balances
Other Current Assets
 Liabilities
Equity
Other Equity

Non Current Borrowings

Borrowing + Lease Liabilities
Other Non Current Liabilities

Current Liabilities
Trade Payable
Current Borrowings
Borrowing + Lease Liabilities
Other Current Liabilities

Income Statement

Revenue from Operation

Less: Cost of Goods Sold or Direct Cos
Gross profit
Less: Employee Cost or Admin Cost
Less: Marketing Cost [Other Exp]
Operating Profit
Less: Non Operating Cost
Add: Non Operating Revenue
EBITDA
Less: Depreciation & Amortisation
EBIT
Less: Interest (Finance Cost)
EBT
Add / Less: Exceptional Item
Less: Tax
Profit After Tax

Direct Method - Butterfly Appliances

Cash Flow from Operating Activity
Collection from Customer
Less:
Payment to Supplier
Adjustment for Inventory
Employee Cost
Marketing Cost
Tax paid
Other Current Asset
Current Borrowing
Depreciation on Sold Assets
Other Comprehensive income adj
Exceptional item
Cash flow from Investing Activity
Payment for buying Operating Assets
Receipt from Non Operating Asset Sal
Receipt from Non Operating Revenue
Other Non Current Asset Inflow

Cash Flow from Financing Activity

Receipt from Equity
Payment of Non Current Borrowing
Dividend paid
Payment of Interest

Cash Outflow
Opening Cash Balance
Closing Cash Balance
epreciation = For the Asset from the date of purchase till this Balanc

2022 2021

18,755.65 17,263.59
550.42 206.16
4,918.59 4,896.75
69.89 70.10
24,294.55 22,436.60
7,278.24 5,818.32
17,016.31 16,618.28
Cash Outflow i
Cash Inflow in
34.39 28.41
370.26 708.14
Cash Inflow in
268.68 345.88 Cash outflow in

20,969.14 17,788.11 Cash Inflow in

9,276.74 7,436.05 Cash Outflow i
1,123.76 3,736.24
2,751.51 2,220.54

51,810.79 48,881.65
 1,787.96 1,787.96
21,712.65 20,611.52

516.30 1,260.89

490.16 125.71

14,065.43 16,361.66
4,815.65 1,677.64

8,422.64 7,056.27

51,810.79 48,881.65

2022 2021
100,530.40 86,963.81
63,347.65 50,614.29
37,182.75 36,349.52
9,920.09 7,701.30
21,660.15 20,953.46
5,602.51 7,694.76
 - -
194.22 158.05
5,796.73 7,852.81
1,546.49 1,555.17
4,250.24 6,297.64
1,113.44 1,462.78
3,136.80 4,834.86
660.48 -
863.64 1,219.05
1,612.68 3,615.81

liances
Amount in Lakhs Amount in Lakhs
98,689.71 Revenue for the year - Cl

(65,643.88) Cost of Goods Sold - Clo

(3,181.03) Opening Inventory - Clo
(9,920.09)
(21,660.15)
(863.64)
(530.97)
4,504.38
(86.57)
24.84
(660.48)
672.12
(1,857.95)
331.90
194.22
77.20
(1,254.63)

-
(380.14)
(536.39)
(1,113.44)
(2,029.97)

(2,612.48)
3,736.24
1,123.76 (2,612.48)
e till this Balance Sheet Date

Cash Flow Statement

Direct Method Indirect Method

Helps to find Cash Inflow Suggested by NFRA

& Cash outflow in
exact manner

Operating Activity Cash inflow or Outflow from Oper

Cash Outflow in a Year towards operation represent payment to supp
Cash Inflow in a Year towards operation represent Collection from Cu

Investing Activity Cash Inflow or outflow from Oper

Cash Inflow in Investing Activity represent Sale of Investment or Ope
Cash outflow in Investing Activity represent purchase of investment

Financing Activity Cash Inflow or Outflow from Borro

Cash Inflow in financing activity represent new borrowing
Cash Outflow in Financing Activity represent repayment of borrowin

Cash Flow Statement intimate the Net Cash Inflow or outflow in

Operating Activity - Inflow

Investing Activity - Outflow
Financing Activity - Outflow

Asset is reducing Cash Inflow

Asset is increasing Cash outflow
Liability is reducing Cash Outflow
Liability is increasing Cash Inflow
Deduction from Profit is outflow
Addition to Profit is Inflow

BS, IS, CFS from a Transaction

Missing Numbers in BS, IS
Rectify a Fin Statement
Ratios - Company balance Sheet
Cash Flow (Outflow) / Inflow

operating investing
cash inflow receivables sale of investment
cash outflow payables buying investment
 for the year - Closing Receivable + Opening receivable

Goods Sold - Closing Payable + Opening Payable

Inventory - Closing Inventory
 w from Operation
yment to suppliers, employees
ction from Customer

w from Operating & Non Operating Asset

tment or Operating Assets
f investment or operating Assets

w from Borrowing or Owner's Equity

t of borrowing

or outflow in a year
 finance
stment borrowing
stment interest + repayment of
borrowing