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Contents
1. Financial Statements: Accounting concepts, conventions and standards
What constitutes financial statements
• Basic concepts
• Indian Accounting Standards
• International Accounting Standards
• Sources of financial information.
2. Revenue Statements
• Trading & Manufacturing account
• Profit and loss account
• Profit and loss appropriation account
• Capital & Revenue expenses
• Deferred Revenue Expenditure
• Capital and Revenue receipts
• Cash accrual/generation
• Format for trading, manufacturing &. profit and loss account
• Aspects in analysis of Income Statement
Annexures:
• Traditional format of trading account
• Format of manufacturing account
• Format of profit & loss account
• Format in company cases
• Format of profit & loss appropriation account
• Format prescribed by RBI for trading activity for non-corporate
entities availing bank loans of Rs.10 lac or more
• Format prescribed by RBI for manufacturing activity for
noncorporate borrowers availing loans of Rs.10 lac or more
• Format for analysis of revenue statement
3. Balance sheet
• Owned funds
• Long term or deferred liabilities
• Short term liabilities
• Contingent liabilities
• Fixed Assets
• Current assets
• Valuation of inventories
• Misc. Assets
• Intangible assets
• Format of balance sheet
• Periodicity of balance sheet
Annexures:
• RBI's classification of current assets and current liabilities
• Abridged format of balance sheet for company cases
• Format of balance sheet for non-corporate trading units as prescribed by RBI.
• Format of balance sheet for non-corporate manufacturing units
• Format for simplifying financial statements for analysis
• Audit of accounts : RBI guidelines
• Balance sheet abstract & company's business profile
• Standard Auditing Practices of ICAI
• Statement on Standard Audit Practices
4. Funds flow statement
• Funds flow : Two concepts
• Changes in working capital concept
• Changes in financial position concept
• Long term sources
• Long term uses
• Short term sources
• Short term uses
• Short term surplus/deficit
• Benefits of funds flow statement
• Format of funds flow statements
• Case lets & case study on funds flow statement
Annexures:
• Format of funds flow statement
• Summary of recommendations of International Accounting Standards
Committee.
5. Cash flow statement
• Cash flow and funds flow statements
• Internal sources of cash
• External sources of cash
• Uses of cash
• Adjustments for computation of cash flow from operations
Annexure:
• Format for cash flow statement
• Cash flow statement for companies
6. Other Financial Information
• Data base for working capital assessment
• Select operational data
• Quarterly information system
Annexures:
• Assessment of working capital
• Operating statement
• Analysis of balance sheet
• Comparative Statement of CAs/CLs
• Computation of MPBF
• Funds flow statement
• Quantitative information format
• Select operational data
• QIS Form-I
• QISForm-II
• QIS Form-III
• Revised QIS Form II
7. Tools for analysis - Ratio Analysis
• What is analysis ?
• Why ratio analysis ?
• Presentation and use of ratios
• Objectivity in Ratio Analysis
• Information for analysis
• How to express ratios ?
• Precautions
• Types of ratios
• Liquidity ratios
• Over-trading/Under-trading
• Leverage or Solvency ratios
• Profitability ratios
• Du Pont Chart
• Activity ratios
• Manipulability of ratios
• Limitation of ratios
• Summary chart of various ratios
8. Tools for analysis - Break Even Analysis
• Fixed revenue cost
• Variable revenue cost
• Expressing the break-even
• Types of break-even
• Benefits of break-even
• Assumptions
• Limitations
• Cost, Volume & Profit and P/V Ratio
• Case Study on Break-even Analysis
• Marginal Costing
9. Case studies on financial statements analysis
• Case Studies No. 1 to 10
10. Balance Sheet of Banking Companies
11. Financial Glossary
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Author Details
N.S. Toor, M.COM., LL.B., M.A., CAIIB., Editor-in-Chief - Banking Events Update (A monthly News-magazine on banking), Director - Institute of Banking Career & Studies, formerly, Chief Manager (Corporate Credit), Punjab National Bank, HO, New Delhi.
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