A STUDY ON FINANCIAL PERFORMANCE ANALYSIS OF MANGALA GAURI SAVING & CREDIT CO-OPERATIVE LTD. -BBS Report
A STUDY ON FINANCIAL PERFORMANCE ANALYSIS OF
MANGALA GAURI SAVING & CREDIT
CO-OPERATIVE LTD.
A PROJECT WORK
Submitted By:
Y Neupane
T.U.Redg.No:
Symbol No: 250864
Nepal Cammerce Campus
Group-Finance
Submitted To:
The Faculty of
Management
Tribhuvan University
Kathmandu
In partial fulfillment
of the requirement for the Degree of
BACHELOR OF BUSINESS
STUDIES (BBS)
Kathmandu
May, 2018
DECLARATION
I hereby declare that the project work entitled
“FINANCIAL PERFORAMANCE ANALYSIS OF MANGALA GAURI SAVING & CRIDIT LTD. ”
submitted to the Faculty of Management, Tribhuvan University, Kathmandu is a
original piece of work under the supervision of Mr.Arun kumar chaudhary,
Faculty Member, Nepal commerce campus, Minbhawan, Kathmandu, and is submitted
in partial fulfillment of the requirements for the degree of Bachelor of
Business Studies (BSS). This project work report has not been submitted to any
other university or institution for the award of any degree or diploma.
Signature:
Name of Student: Yadab Neupane
Date:
SUPERVISOR’S RECOMMENDATION
The project work report
entitled FINANCIAL PERFORMANCE OF MANGALA GAURI SAVING & CREDIT
CO-OPERATIVE LDT., submitted by YADAB NEUPANE of Nepal commerce campus,
Minbhawan, is prepared under my supervision as per the procedure and format
requirements laid by the faculty of Management. Tribhuvan University, as
partial fulfillment of the requirements for the degree of Bachelors of Business
Studies (BSS). I, therefore, recommend the project work report for evaluation.
Signature:
Name of supervisor: Arun Kumar Chaudhary
NEPAL COMMERCE CAMPUS
Date: May, 2018
4107045, 4107048
P.O.Box
No.2465
E-mail:info@ncc.edu.np
TRIBHUVAN UNIVERSITY
Faculty of Management
NEPAL COMMERCE CAMPUS
Minbhawan, Kathmandu, Nepal
ENDORSEMENT
We hereby endorse the project work report entitled”
FINANCIAL PERFOMANCE ANALYSIS OS MANGALA GAURI SAVING &CREDIT LTD.”, submitted by YADAB NEUPANE of Nepal
Commerce Campus, Minbhawan, in partial fulfillment of the requirement for the
degree of the Bachelor of Business Studiess (BBS) for external evaluation.
Signature: Signature:
Prof. Dr.
Jitendra Upadhyaya Prof. Dr.
Jeevan kumar Bhattarai
(Head of Research Department) ( Campus
Chief/Principal)
Date:
Date:
ACKNOWLEDGMENTS
I am very greatful and proud to present this project
report entitled “FINANCIAL PERFORMANCCE
ANALYSIS OF MANGALA GAURI SAVING & CREDIT CO-OPERATIVE LTD.” For the partial fulfillment of Degree of
Bachelor of Business Studies (BBS).I would like to express my gratitude towards
Tribhuvan University for providing me with this wonderful opportunity.
I would also like to thank my project guide Aurun
Kumar Chaudhary for his guidance, motivation and support throughout this
project. I also express my regards to all the teaching and non-teaching staff
of Nepal Commerce Campus, New Baneshwor, Kathmandu, who have supported me
throughout my BBS degree and made this report possible. I also thank all the
researchers worldwide who are doing research in the field of Economy &
Finance, whose work has really inspired me
I take this opportunity to thank my family, relative
and friends who have supported and motivated me to do better in my life.
TABLE OF CONTENTS
Page
No.
Title page
Declaration
Supervisor’s Recommendation
Endorsement
Table of Contents
List of Tables
List of figures
Abbreviation
CHAPTER
1: INTRODUCTION
1.1 Background
of the study 1
1.2 Introduction of Mangala Gauri S.& C.C Ltd 2
1.2.1Structure of Mangala Gauri
S.& C.C. Ltd 3
1.3 Objectives of
the Study 3
1.4 Rationale of
the study 3
1.5 Related Literature Review 4
1.5.1Review of
Literature 4
1.5.2 Report Structure 5
1.6 Methodology 5
1.6.1 Research Design 5
1.6.2 Population and
Sample 6
1.6.3 Types of Data 6
1.6.4 Data Collecting Procedures 6
1.6.5Tools and Techiniques Used 7
1.7 Limitations
8
CHAPTER-
2: RESULTS AND ANALYSIS
2.1
Data Presentation 9
2.1
Major Finding 15
CHAPTER
-3: SUMMARY AND CONCLUSION
3.1 Summary 16
3.2 Conclusion
17
References 19
Reports 19
List
of Tables
Table: Page No.
Table 1 Current Ratio Analysis 9
Table 2 Cash Reserve Ratio 11
Table 3 Return on Equity 12
Table 4 Return on Total Assets 13
Table 5 Profit Margin Ratio 14
List
of Figures
Figure: Page
No.
Fig
1Graph showing Current Ratio 10
Fig 2 Graph
showing Cash Ratio 11
Fig 3 Graph Showing Return on Equity 12
Fig 4: Graph showing
Return on Total Assets 13
Fig 5: Graph
showing Net profit Margin 14
Abbreviations
MGS&CC
Ltd-Mangala Gauri Saving and Credit Cooperative Limited
CRR- Cash Reserve
Ratio
ROA- Return on Total
Assets
ROE- Return on Equity
NPM-Net Profit Margin
NEFSCUN-Nepal
Federation of Saving and credit
Cooperative Unions
AGM-Annual General
Meeting
Chapter-1
Introduction
1.1 Background of the study
A
co-operative is an organization whose primary functions are concerntrated with
collection of idle money from general public and providing loan to small
business and individuals for expenditure. In other words, cooperative are the
important financial institution in the
local economic and needs. Normally co-operatives finance collects money from
customer to saving their a small part of money. A small parts os money collects
and they can be invest different sectors such as small business, agriculture's
product for which it changes certain percentage
of interest. The interest is higer than interest paid by the
cooperatives to collected fund. Generally the interest rate of collection of
fund of cooperative higer than bank because this is more risky than bank. The
cooperative organization income from their difference in pays interest and
receives interest.
Cooperative
is an autonomous association of person united voluntarily to meet their common economic, social and cultural needs
and aspirations through a jointly owned and democratically controlled
enterprise
Cooperatives
are based on the values of self-help, self-responsibility, democracy, equality ,equity
and socidarity. In the tradition of their founder, cooperative member belive in
ethical value of honesty, openness, social responsibility and caring for other.
Co-operatives are business owned and run by and for their members. whether the
mambers are the customers, employees or residents they have an equal say in
what the business does and a share
in profits. As business driven by values
not just profit, cooperatives shares
internationally agreed principle and act together to build a better world
through cooperation successful cooperatives arround the world are allowing people to work
together to create sustainable enterprises that generate jobs and prosperity and
provide answers to poverty and short term business practice
1.2
Introduction of Mangala Gauri S. & C. C. Ltd.
Mangala
Gauri Saving &credit Cooperative
Ltd. established in 18-04-2066 under the nepales cooperative Act-2048,is
financial institution permitted to carry out financial trancations .The office
located in New Baneshwor, Kathmandu. This institution is managed by perfectly
skilled personnel who have involved in different financial sector and suggested
provided to co-operative's staff for retirement staff
of Government, who have export for financial sector.The organization aim to
provide attrative interest rates to the collected principle and provided loan
to honest professionals and entrepreneurs to promote their business,making them
capable and independent in competitive
financial environment with the motto of.
In
this orgenization,7th Annual General
metting completed ,the total shareholder number is 401,total capital
Rs.1,55,63,200 and deposit collection Rs.17,64,74,041. Mangala Gauri Saving
&Credit Cooperative Ltd. beleves that a cooperative is only successful when
its customers are successful
Mission
''To be the leading co-operative organization in Nepal by
providing the finest quality financial products and service to our customer:
enhance our shareholder's value, contribute to the economic rise of the
country.''
Vision
''To support
individuals, families and business to attain financial independance and improve
their financial wellbeing''
1.2.1
Structure of MANGA GAURI S. &C. C. LTD.
Mangla Gauri saving & credit
Co-operative Ltd. At 2073/74
Post
|
Name of organization
|
Chairman
|
Suresh Kumar Regmi
|
Voice chairman
|
Rajendra P. Gautam
|
Secretary
|
Ram P. Sharma
|
Cashier
|
Kishwor kumar Achary
|
Managing Director & Member
|
Toyanath Phuyal
|
Member
|
Lok B. Kuwar, Pinga Devi Adhikari, Ram
B. Kuwar, Tara Sharma.
|
Accounting Committee Member
|
Chakra P. Sharma, Dhurb Chandra Godar,
Nikita Subedi.
|
1.3 Objectives of the Study
Ratio
analysis can provide an early warning of potential improvement or, deterioration in a company’s financial
sitution or, performance. Analysis engage in extensive number crunching of the
financial data in a company’s financial reports for any such hits. The main objectives behind this
research are as follows:
·
To find out the liquidity ratio of this cooperative
·
To analyze the strength and weaknesses
of financial position
1.4
Rationale of the Study
Every research has its
own importance because its aims to gain knowledge and add new literature to the
existing fields. This study is also helpful to the borrowers and learners to
gain the information regarding the trend of ratio. This study is important for
others parties such as University, researcher, students and so on. Following
are the significance of the study:
·
This study will provide important
information and data to stakeholder and
other related aspects.
·
Its help to know about the liquidity
condition of the organization
·
This research will be important for the forth
coming students who need some information; it will be a reference for them.
1.5 Related Literature Review
1.5.1 Review of
Literature
Financial performance
analysis is used to evaluate various
aspects of a company’s operating and such as its efficiency, profitability and
solvency. The trend of these ratios over time is studies to check whether they
are improving or deteriorating. Ratios are also compared across different
companies in the same sector to see how they stack up, and to get an idea of
comparative valuations. Ratio analysis is a cornerstone of fundamental
analysis. Liquidity analysis is the process of determining and interpreting
numerical relationship based on financial statements. A ratio is a statistical
yardstick that provides a measure of relationship between two variables or
figures. This relationship can be expressed as a percent or as quotient. Ratios
are simple to calculate and easy to understand. The person interested in the
analysis of financial statement can be grouped under three heads while there
are numerous financials ratios: most investors are familiar with a few key
ratio, particularly the ones that are relatively easy are relatively easy to
calculate. (Khan A.R., (2000).
Some of these ratios
include the current ratio, return on equity, the debt-equity ratio and the
price/earning (P/E) ratio. For a specific, most companies have values that fall
within a certain range. A company whose ratio falls outside the range may be
regarded as grossly undervalued or overvalued, depending on the ratio.
Liquidity analysis can provide an early warning of potential improvement or,
deterioration in a company’s financial situation or, performance. Analysis
engange in extensive number-crunching of the financial data of the company’s
quarterly financial report for any such hints. Successful companies generally
have solid ratios in all areas, and any hints of weakness in one area may spark
a singnificant sell-off in the stock. Certain
ratios are closely scrutinized because of their relevance to a certain
sector, as for instance inventory turnover for the retail sector and day sales
outstanding for technology companies. (Thapa K. & Koirala N.(2011).
Financial
Analysis involves the use of financial statement the first is the balance
sheet, which represents a snapshot of the firm’s financial position at a
movement in time and next as the income statement that depicts a summary of the
firm’s profitability over time” ( Van horne and Wachowicz, 1997:96)
1.5.2
Report Structure
The
structure of the study will try to analyze the study in a systematic way .The study
report has design in three chapters which
are described as follows;
·
First chapter will include background of
the study, profile of organization, objectives of study rational of study,
literature review, methodology, population and sampling and limitations of
study.
·
Second chapter will include result and
analysis.
·
And last chapter will include summary
and conclusion.
1.6 Methodology
Research
methodology is concern with a varios methods use in the process of preparing project report. It is the
systemetic way to carry out research how
the data are collected and which source the research uses for getting the data
is under the research methodology .Research methodology includes research
design ,source of data population and sample e.t.c.
1.6.1 Research Design
The research design
refers to the overall strategy that you choose to integrate the different
components of the study in a coherent and logical way, ensuring you will
effectively address the research problems: it constitutes the blue print for
the collection, measurement and analysis of data .A research design is the plan
of a research study
1.6.2
Population and sampling
The
population refers to the industries of the same nature and its services and
prduct in general. But we cannot applied this samplings and population in the
exasitly behaviour bacause we collected secondary data, this data is not able
to give perfectly conclusion
Today, the Interim
Constitution of Nepal has considered the co-operative sector as one of the
three pillars for national development. The major types of co-operative
societies operating in Nepal are Saving and Credit, Multipurpose, Dairy,
Agriculture, Fruits and Vegetables, Bee Keeping, Tea, Coffee, Consumers,
Science and Technology, and Energy. It is believed that some 6 million people
are already affiliated in approximately 34,512 cooperatives and more than
60,517 people are employed directly in Cooperative business.(2017, Department
of Cooperatives)-NEFSCUN
1.6.3 Types of data
There
are two types of data. First, primary sources of data, this data is first hand
data which are collected from the observation .This was not able use for our
report because we are student. Next,
secondary sources of data, which are obtained from different sources. We collect secondary sources of data
from published notice in public and unpublished and AGM, audit report of this
organization. The AGM and audit report taken from Mangala Gauri Saving
&credit Cooperative Ltd.
1.6.4 Data Collecting Procedures
Due
to confidentiality maintained by this organization secondary sources,
especially the annual report of the concerned co-operative are taken as main
source of data collection for purpose of study. The annual reports of concerned cooperatives were
obtained from their office and AGM reports.
1.6.5 Tools and Techniques Used
In
this study, various financial and statistical tools have been used to achieve
the objective of the study. To achieve the predetermined objective of the
research, certain tools will be used. The tools are categoried as:
1. Financial
Tools
2.
Graphical Tools
3.
Statistical Tools
In
this study, following statistical tools are used to analyze the financial
performance of the co-operative:
Liquidity Ratio:
Liquidity ratio measures the ability
of the firm to meet its current obligations. Liquidity provides honor strength health and
prosperity to an organization. It is extremely essential for an organization to
meet its obligations as they become due. A firm should ensure that it has not
lack of liquidity and also that it is not too much highly liquid.
Profitability Ratios:
Profit
is the difference between revenue and expenses. A profit is necessary for the
survival of the company and also meets the expectation of shareholders. It is
the measure of the performance of any business that it is doing well or not. It
is calculated to measure the operating efficiency of the firm. Profitability
ratio shows the combined effects of liquidity management and debt management on
operating result.
The tools used for analysis are following:
Current
Ratio =
Quick
Ratio =
Cash
to Current Assets Ratio =
Cash
to Current Liability Ratio =
Cash
and Bank Balance to Deposit Ratio =
Liquid
Assets to Total Assets =
Investment
to Deposit Ratio =
Return
to Equity =
Return
on Assets =
Profit
Margin Ratio =
Net
Working Capital Ratio =
1.7
Limitation of Study
In the research time, we are not able to use
primary data of this organization. We used secondary data like annual general
meeting report, other published and unpublished data. The following factors are
the basic limitations:
·
The
main constraints of the study are insufficient of information which is highly
required for the study.
·
This study is limited to the information
that was available from the secondary data.
·
This study is mainly carried out to
attain the partial fulfillment of BBS 4th year study.
·
Only few financial tools are used in
this study.
Chapter-2 Results and Analysis
2.1 Data Presentation:
Annual reports of the company present the financial statement of the
company. All this statement taken together give an accounting picture of the
firms operation and financial operation. Financial statements analysis is
useful to investors for the propose of making investment decisions. It provides
valuable information about the company regarding it performance and financial
position on the basis of which investors can meaningful investment decisions.
Financial ratios related to
the financial performance are presented to analyze the performance of Mangala
Gauri Saving & credit Co-operative Ltd. Some important financial ratios are
calculated in the point of view of financial performance. The ratios are
designed and calculated to highlight the relationship between financial
performances. The main sources of data are secondary data related to financial
performance of the organization. Different tables and diagrams are shows to
make the at analysis simple and understandable. Thus here are some of the
elements to be noted in the process of presentation and analysis of financial
position of the organization where we used various financial tools and there
are as follows:
Current ratio:
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 that company’s current total liabilities. The formula for
calculating a company’s current ratio is following as:
·
Current Ratio =
Higher current ratio indicates better liquidity
position.
Table
1: Current Ratio Analysis
Year
|
Current Assets
|
Current Liabilities
|
Ratio
|
2070/71
|
32535534
|
3128647
|
10.40
|
2071/72
|
31780985
|
2788369
|
11.40
|
2072/73
|
37341941
|
2647174
|
14.11
|
2073/74
|
48844035
|
3842567
|
12.71
|
2074/75
|
24376485
|
5352266
|
4.55
|
Fig
1: Diagram showing Current Ratio
Generally,
higher current ratio indicates better liquidity position and 2:1 times or more
is considered satisfactory. Here in the context of the Mangla Gauri Saving
& Credit cooperative Ltd., the current ratio of 2070/71 is 10.4, 2071/72 is
11.4, 2072/73 is 14.71, 2073/74 is 12.71 and 2074/75 is 4.55 times.
Cash
Reserve Ratio (CRR)
This ratio shows the
percentage of Liquid assets held on compared to the total deposit. High ratio shows
the strong liquidity position of the bank. But very high ratio is not favorable
for the cooperative, as it does not produce appropriate profit to bear the high
interest.
The total deposits
consists of Current deposits, savings deposits, fixed deposits, money at call
and short notice and other deposits.
This ratio is
calculated as:
·
CRR =
Table 2: Cash Reserve
Ratio (CRR)
Year
|
Cash and Bank Balance
|
Total Deposits
|
Ratio (%)
|
2070/71
|
32535534
|
120735295
|
26.94
|
2071/72
|
31780985
|
132808824
|
23.93
|
2072/73
|
37341941
|
176474041
|
21.16
|
2073/74
|
48844033
|
188372125
|
25.93
|
Fig.2: Graph showing Cash Reserve
Ratio
This ratio shows the
ability of banks funds to meet their deposits. Dividing cash and bank balance
calculate this ratio by total deposit. High ratio shows the good liquidity
position, the ratio of Mangla Gauri Saving & Credit Cooperative Ltd., from
2070/71 to 2073/74 is 26.94%, 23.93%, 21.16% and 25.93%.
Return
on Equity Ratio (ROE):
Return on equity is
used in finance as a measure of a company’s profitability. It reveals how much
profit a company generates with the money that equity shareholders have invested.
This ratio is useful for comparing the profitability of a company to that of
other firms in the same industry. It is calculated as following:
·
Return on Equity =
Table 3: Return on Equity
Year
|
Net profit
|
Net Equity
|
Ratio (%)
|
2070/71
|
1294621
|
15556700
|
8.32
|
2071/72
|
1102260
|
15556700
|
7.10
|
2072/73
|
990969
|
15563200
|
6.70
|
2073/74
|
1162860
|
15566000
|
7.50
|
Fig 3:
Graph showing Return on Equity
Figure: 2
showing the return on equity of the MGS&CC Ltd. Over the five year. The trend
is fluctuating. Return on equity are: from 2070/71 to 2073/74 is 8.32%, 7.1% , 6.7%
and 7.5%.
Return
on Total Assets (ROA):
Return on assets (ROA) is a financial
ratio that shows the percentage of profit a company earns in relation to its
overall resources. It is commonly defined as net income divided by total
assets. Net income is derived from the income statement of the company and is
the profit after taxes. It is calculated as following:
·
Return on Total assets =
Table
4: Return on Total Assets
Year
|
Net profit
|
Total Asset
|
Ratio (%)
|
2070/71
|
1294621
|
142079216
|
0.911
|
2071/72
|
1102260
|
166552808
|
0.66
|
2072/73
|
990969
|
199236382
|
0.50
|
2073/74
|
1162860
|
213112326
|
0.55
|
Fig 4: Graph showing Return on
Total Assets
Figure-4 Showing Return On Total
Asset, Return on total assets is obtained by dividing net income after tax by
total assets. This ratio measures the efficiency of cooperative in utilization
of overall assets. High ratio indicates the success of management in overall
operation, all low ratio means inefficient operation of organization. The ratio
from 2070/71 to 2073/74 is 0.911%, 0.66%, 0.50% and 0.66%.
Profit Margin Ratio:
Profit
margin is a profitability
ratios calculated as net income
divided by revenue, or net profits divided by sales. It is calculated as following:
·
Profit Margin Ratio =
Table
5: Profit margin Ratio
Year
|
Net profit
|
Sales/Revenue
|
Ratio (%)
|
2069/70
|
2292538
|
15153865
|
15.13
|
2070/71
|
1294621
|
18491552
|
7.00
|
2071/72
|
1102260
|
19150971
|
5.67
|
2072/73
|
990969
|
20737476
|
4.78
|
2073/74
|
1162860
|
26495991
|
4.39
|
Fig 5: Graph showing Net profit
Margin
Figure:5
showing net profit margin ratio the
profitability capacity of the cooperative. The ratio of the cooperative is
15.13%, 7%, 5.76%, 4.78% and 4.39%.The trend of net profit margin ratio is
decreasing trend.
2.1 Major Finding
This field work report has following major finding
about MGSCC Ltd.:
·
MGSCC
Ltd. Is one of the cooperative organization in Nepal. The function of the
cooperative is similar to banking role, in which provide loan and collecting deposit from
public.
·
The study
shows the current ratio of MGSCC Ltd. Over the study years, in 2070/71 the
current ratio is 10.4 times, in 2071/72 it is 11.4 times, in 2072/73 it is
14.11 times, in 2073/74 it is 12.71 times and 2073.74 it is 4.55 times. The
trend of current ratio is fluctuating trend. The current ratio helps to know
the ability to pay the short term borrowing.
·
The study
shows the cash reserve ratio of MGSCC Ltd. Over the study years, in 2070/71 the
cash reserve ratio is 26.94%, in 2071/72 it is 23.93%, in 2072/73 it is 21.16%
and in 2073/74 it is 25.93%. The cash reserve ratio measure the liquidity
position of organization. The trend of cash reserve ratio is fluctuating.
·
The
return on equity ratio shows the return position of the organization .The ratio
of MGSCC Ltd. Over the five years is; in 2070/71 the return on equity is 8.3%,
in 2071/72 it is 7%, in 2072/73 it is 6.7% and in 2073/74 it is 7.5%.
·
The study
of net profit margin ratio of MGSCC Ltd
over the study years, in 2069/70 the net
profit margin ratio is 15.13%, in 2070/71 it is 7%, in 2071/72 it is 5.67%, in
2072/73 it is 4.78% and 2073/74 it is 4.93%. The net profit margin ratio
measured the earning capacity of organization. The trend of organization is
fluctuating.
Chapter-3
Summary and Conclusion
The summary and
conclusion of the study are concluded in this chapter. The final and most
important task of the researchers is to enlist fact-finding of the study and
suggestions for further improvement. The analysis is performed with the help of
the financial tools and a statistical tool, which is associated with the
comparisons and interpretation under financial analysis, various ratios related
to financial performance analysis are used and under statistical analysis some
relevant statistical tools are used.
3.1
Summary
The study
seeks to examine the factors that influence the analysis of Mangla Gauri Saving
& Credit Co-operative Ltd. The study relating to determinants of banks
liquidity has become an important issue for financial and economic researcher
and scholars as some of the commercial banks are found to be more liquid than other and the
liquidity if found to become controlled by some common factor.
Liquidity
is defined as bank’s capacity to pay cash in exchange of deposit. Liquidity
position of banks or financial institution is the key factor of the sound
operating position. The financial institution have to maintain a sufficient
amount of liquidity because there will be a large portion of deposit payable on demand, in ability of a
bank to repay deposit on demand damages credit worthiness of a bank or
financial institution. Bank’s liquidity constitutes cash and bank balance,
money at call or short notice and investment in government securities. Cash and
bank balance are idle assets. Placement and investment on some interest
.Inadequate liquidity may to collapse of the bank while excess liquidity
detrimental to bank’s profitability.
Mangala
Gauri Saving &credit Cooperative Ltd. established in 18-04-2066 under the
Nepalese Cooperative Act-2048, is financial institution permitted to carry out
financial transactions .The office located in New Baneshwor, Kathmandu. This
institution is managed by perfectly skilled personnel who have involved in
different financial sector and suggested provided to co-operative's staff for retirement staff
of Government, who have export for financial sector. The organization aim to
provide attrative interest rates to the collected principle and provided loan
to honest professionals and entrepreneurs to promote their business, making
them capable and independent in
competitive financial environment with the motto of.
In
this orgenization,7th Annual General meeting
completed ,the total shareholder number is 401, total capital Rs.1,55,63,200
and deposit collection Rs.17,64,74,041. Mangala Gauri Saving &Credit
Cooperative Ltd. belives that a cooperative is only successful when its
customers are successful. The main objectives of MGSCC Ltd is to improve the
social-economic conditions of the majority of the poor, The landless and the
asset less through increasing their access to institutional cooperative
services for productive undertakings and self employment.
3.2 Conclusion
As per my stated objective, I would like to clearly conclude
my report.
·
To know
about the financial/liquidity position of MGSCC Ltd., I have clearly used
various indicators that clearly define the liquidity position of this
organization. Using various indicators like current ratio, cash reserve ratio,
return on equity and other I have shown result of each indicators. From above
analysis we could say that the financial position of MGSCC Ltd is satisfactory
by seeing the over the study years result. In all years generally MGSCC Ltd has
been keeping optimal liquidity position so that it could pay off short term
debt easily and also its have good cash reserve ratios would helps be
liquidity.
·
As per my
stated objective another was to know about the liquidity management policies.
The liquidity management policies could be certainly find out by seeing how
company handles the liquidity terms. So, I find that the liquidity management policy
of MGSCC Ltd is average. They have optimal level of liquidity capacity. They
have successfully generated more earning than more debts. There is less chance
of insolvency or being unable to pay debts in case of MGSCC Ltd. The liquidity
management policy is generally good and better.
·
ROA is an
indicator of how profitable a company is relative to its to total assets. ROA
gives an idea as how efficient management is at using its assets to generate
earning. Calculated by dividing a company’s annual earning by its total
assets.ROA is displayed as a percentage.
·
ROE is
the amount of net income returned as a percentage of shareholders equity.
Return on equity measures a cooperative’s profitability by revealing how much
profit a company generates with the money shareholders have invested.
·
These
indicators are profitability indicator of this cooperative. So in conclusion we
can say that the profitability of MGSCC Ltd is average. We could see are return
in both ROA & ROE.
·
Another
is MGSCC Ltd has been able to clear its liabilities in over study years as it have a more current assets
and positions of MGSCC Ltd is quite bit
satisfactory. Their liquidity position is optimal level. The management policy
for financial of the organization is quite good.
So as to conclude the study or to write some brief term about
the study, only the chief point has been focused. Following conclusion can be
derived from this study report of MGSCC Ltd:
·
Current
ratio is decreasing level over the study years
·
Cash reserve
ratio is fluctuating trend over the
study years
·
ROA, ROE
and NPM is fluctuating nature.
Implication
Every report is made with some objectives and aim which can
be use full to others doing related to that field. The one of the objectives of
this report is to provide the information about the hardware business to the
students who are thinking about to start this business.
REFERENCES
·
Adhikari, D.R. & Pandey D.L. (2074),
Business Research Methods, Asmita
publication, Kathmandu
·
Thapa, K., parajuli, M., Dodhari, S.&
Shrestha, R.(2073), Fundamentals of
Financials Markets & Institutions, Januka publication, kathmandu
·
Sharma, D.R., Thapa,K.,Pandeya, Chudamani,
Joshi,R., Lamsal, L.P. (2073), Fundamentals
of Investment, Khanal publication, Kathmandu
·
Bhattarai, J. K., Ghimire, S. (2073), Fundamental of Corporate Finance, K.P.
Pustak bhandar, Kathmandu.
Thesis
Sapkota,
S., (2066). “FINANCIAL ANALYSIS BETWEEN EVEREST BANK LIMITED AND PRIME
COMMERCIAL BANK LIMITED” an unpublished master degree thesis: Tribhuvan
University
Reports:
MGSCC
Ltd. (2070/71), Annual report, Kathmandu
MGSCC
Ltd. (2071/72), Annual report, Kathmandu
MGSCC
Ltd. (2072/73), Annual report, Kathmandu
MGSCC
Ltd. (2073/74), Annual report, Kathmandu
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