cresent bahuman limited

University of the Sargodha

INTERNSHIP REPORTINTERNSHIP REPORT

ONON

“CBL”“CBL”((Crescent Bahuman LimitedCrescent Bahuman Limited))

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INTERNSHIP REPORTINTERNSHIP REPORT

ONON

(Crescent Bahuman Limited(Crescent Bahuman Limited))

Submitted To: Submitted To:

Prof. Ghulam Ali Bhatti

Approved By:

Mr. Zahid Ali

Submitted By: Submitted By:

Muhammad Shahzad Aslam(28ss)Muhammad Shahzad Aslam(28ss)

M-Com M-Com

University of the Sargodha University of the Sargodha

SargodhaSargodha

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Preface

Being aware of the importance of practical training, the Institute

of Administrative Sciences, University Of The Sargodha, requires

every Master student to go through training for practical purpose

as trainee.

The internship program is to broaden the vision of practical

experiences with theoretical knowledge as it increases one’s

capabilities to handle problems at various stages and the ability

of decision.

I tried my best to collect the valuable information and its relevant

facts.

This report is the result of my internship with Crescent Bahuman

Limited.

The Crescent Bahuman is deeply committed to organizational

objectives that are directly related to its institutional mission of

providing high quality healthcare to veterans. These objectives

are met in part through a variety of employee, intern, and

residency training programs in several departments in the

organization.

The primary goal of this Internship Training Program is to

prepare interns for competent entry into the increasingly complex

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roles of organization or. My expectation about the Crescent

Bahuman is that the employer will become part of the

organization and they are much sincere with that organization.

Interns are expected to learn and demonstrate entry-level

proficiency in: 1) psychological assessment, 2) Awarness of the

environment of the organization, 3) consultation/

supervision/teaching, 4) professional and ethical behavior, 5)

diversity issues, and 6) scholarly inquiry and critical, empirically-

based evaluation of internee and other managerial activity.

Interns completing the program should be fully prepared for

further permanent training or entry-level professional positions

involving organizational treatment, teaching, or research,

Our decision to apply at an internship site is an important one --

the internship experience often defines the path that a

professional psychologist’s career will take. Please take the time

to read the enclosed information carefully.

An internship is an opportunity that allows a qualified student to

gain professional, supervised experience related to his or her

field of interest. Internships are usually completed during the

summer and/or semester breaks; however, a local internship

could be completed during the semester if the student's schedule

allows a sufficient amount of time. All students are eligible to

intern, although academic credit depends on the requirements

set forth by the employing organization and the student's

academic departments. Compen

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ACKNOWLEGEMENT

First of all I am very thankful to Almighty ALLAH who gave me

courage and confidence to making this internship project on

CRESCENT BAHUMAN Ltd. I am also thankful to my respect

senior Mr. RAMZAN who is my best and sincere friend and

Senior Accountant in the Crescent Bahuman limited, and who

gave me chance and opportunity to make such a professional

project, in which I analyze the entire scenario regarding industry

and management perspective. He has been a steady source of

track throughout the course of this whole internship. His

innumerable ideas were precious and gave me with an insight to

the path, which was off the beaten track otherwise. I have yet to

see the limits of his sympathetic, stamina and altruistic concerns

for me. I am especially thankful to our parents, families and

friends for giving me the silent support in terms of courage and

strength that I needed to accomplish my goals. Words might not

be adequate to express my feelings towards them.

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DEDICATION

I would like to dedicate this report to my dear parents and

respected teachers who guided me through my studying carrier

and my still doing their best for me. To be here in this institution

at this level I am just because of my parents, especially their

training, guidance, love, affection and motivation. I pray that I can

serve my parents as best as I can.

“Parent’s Blessings are Our Most Valuable Assets”

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sation is not required, and varies by position and industry.

“To be the best supplier of the products and services to our

global communication customers at the lowest total

cost of ownership”

Vision statement To promote the products and services in international

markets. To be a customer focused organization with

product quality and Service excellence

.

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Executive summary

Crescent Bahuman, the largest vertically integrated denim

manufacturing facility in Southeast Asia

Crescent Bahuman prepares jeans and denims related items for

the manufacturers. We will expand production capacity of jeans

and denims & threads. We prepare the top five percent, in terms

of quality standards, of all jeans on the market. Our customers

seek this product as it provides them with a point of

differentiation to specialty roasters. In the past six years, demand

for our products has exceeded the amount we are able to supply

and we have been forced to refuse requests for larger shipments.

We predict growth of thirty percent in the first year with sales

exceeding $26,208,000. In this year three the plant will run at

maximum capacity and based on the current price of products we

expect profits of $ 2.5billions. We have positive indicators from

current importers that the additional amount of beans will be sold.

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Crescent Group Chronology

Company’s Objectives

Vision Statement

Mission Statment

Financial Department

Employees in dept.

Functions

a) Primary Functions

b) Secondary Functions

Oracle Financial Software

Business Volume

SWOT Analysis

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Conclusion

Limitations

Bibliography

Recommendation

Glossary

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Organizational Profile

Crescent Bahuman, the largest vertically integrated denim

manufacturing facility in Southeast Asia

Crescent Bahuman Ltd. originally setup as a joint venture

between The Crescent Textile Mills, Pakistan and Greenwood

Mills Inc., USA is now fully owned by the Crescent Group. The

plant is located in Pindi Bhattian, Pakistan roughly 5 hours from

Lahore and 8 hours Islamabad along a motorway connecting

both cities.

Designed as a vertical jeans wear facility, it commenced

commercial production in June 1995. The plant is situat4d on 550

acres with 165 committed to commercial activates and

manufacturing facilities of 1 million square feet. The facility is one

of the first single site operations to include processing of raw

cotton through finished jean wear. It also has a wastewater

treatment plant and a power generation plant within the

compound.

Crescent Bahuman Ltd. has established a corporate philosophy

for the betterment of the nearly 5000 employees and community

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while ensuring an environmentally friendly manufacturing

process.

The facility is equipped with the latest technology in equipment

from spinning through garment finishing with a capacity of 11.5

million meters of fabric, which when converted produces 8 million

jeans annually.

In September 1998, Apparel Marketing & Operations Ltd. Was

established to manage CBL. Along with its day to day

management of operations and development of new strategies

for marketing and sales, AMOL opened an office in Derry,

Northern Ireland for the Marketing and Sales functions while

creating an expatriate team in Pakistan to manage the

operations and continue training of local management.

The focus is to create seamless interface throughout the

manufacturing process addressing delivery, cost and quality

issues providing the right product the first time, at the right

time. The speed of developing and getting the right product

to the customer is at or above par with manufacturers all over

the world.

Lead-time from order to delivery to market has been a

continuing focus of Crescent Bahuman Ltd. With extensive

investment into systems right from order-taking and

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procurement through to production and delivery CBL has

managed to squeeze its lead time to the satisfaction of its

global customer base.

Crescent Group’s 60 Years Chronology

Introduction:

The Crescent Group (CG) has been in business since the

beginning of twentieth century. They are known for their strong

business ethics and their highly professional management, for

which they command respect from the local and international

business community. With its widespread presence, strong

background and management strength, Crescent Group is well

positioned to continue expanding rapidly by taking advantage of

the liberal and improving economic environment in Pakistan.

They have survived and recovered from turbulent political

situations and economic crisis spread from the partition of the

sub continent and Pakistan’s history.

The diversity of The Group is reflected through its independent

operating companies operating in diversified business sectors all

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over Pakistan. Among them are some of the companies that are

premiers and market leaders in textiles, jute, sugar, engineering,

investment, banking, insurance, leasing sectors etc.

The Crescent Group employs over 17,000 people and has

revenues exceeding Rs 20 billion from its few of its prominent

companies. This constitutes over 0.55% of the country’s GDP

and over 1% of the market capitalization of Pakistan. The

consistent growth of the Group has resulted in numerous joint

venture partnerships with international companies desiring to

invest within the economy.

Crescent Group has the slogan of “The people who care for

people" and the Crescent Family has a general reputation of

never transferring their money abroad. Crescent family

particularly has the reputation of being truly rooted and

entrenched in the Pakistani Soil and is considered to be a

conscientious tax payer.

An article in Weekly Friday Times in the first week of April 1993

described Crescent as "one of the oldest, largest and most

distinguished business concerns in Pakistan, an exemplary tax

payers and investors of every penny earned back into their

business of the home country". Presided over by eldest member

of the family, Mr. Mazhar Karim, the Group has over twenty

working members and can be truly called a joint venture of

uncles, cousins and nephews. This Chiniot sheikh family has

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lived up with quite a wonderful reputation, bearing an excellent

record with its creditors throughout its business. Men running

Crescent do not have to make contacts, for the privilege comes

to them naturally.

Mission statement Crescent Bahuman is a large-sized textile company focusing on jeans

manufacturing and an intriguing atmosphere, in a prime neighborhood

of Pakistan.

Evolution of the Group

Pre Partition Era:

The history of the group dates back to 1910 when Mr. Shams Din

of Chiniot and his four sons Mr. Amin, Mr. Bashir, Mr. Fazal

Karim and Mr. Muhammad Shafi came into business with a

tannery at Amritsar. By the time Pakistan was born, they had

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offices at Madras, Jalandhar, Calcutta, and Delhi, and were

running the largest leather business in India.

Post Partition Era – 1950s

The period of 1950s for Crescent Group was dominated by its

focus upon the textile sector. After migrating to Pakistan, the

Crescent family struggled to regain its strength and growth pace,

which it had left back in India. Crescent family was allotted an

industrial unit sprawling over 125 acres in Faisalabad, in lieu of

the property left over in India, which was to become the spring

board of their growth and diversification. After the creation of

Pakistan, three of the above mentioned four brothers returned to

the native land and in 1951, incorporated a trading company

Muhammad Amin Muhammad Bashir Limited for export of cotton

and imports. Mr. Bashir settled in Karachi, Mr. Amin managed

the operations from Lahore while Mr. Muhammad Shafi worked

at the ginning factory in Sargodha.

After migrating to Pakistan, the family took advantage of the

incentives offered by the government for setting up industries

and established Crescent Textile Mills Limited. The 1950s also

saw the establishment of the Crescent Sugar Mills which was

later expanded through the addition of a distillery plant. In the

beginning Crescent Sugar was operating as a unit of Crescent

Textile Mills Limited. However, after commencement of the

operations of distillery, unit it become a separate entity and got

listed on the stock exchange.

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The Decade of 1960 – Diversification of

Group’s Business

By mid 1960s Mr. Fazal Karim also returned to Pakistan and the

four brothers fondly known in the business community, as the

“The Gang of Four" soon became Pakistan's biggest textile

exporters. They were also joined in the business by their two

cousins. In 1964, Crescent Jute Products Limited was set up and

the Group took full advantage of unlimited resources of the

country’s jute production in the eastern region.

During the late 1960s the group expanded by setting up Crescent

Boards Limited and Shams Textile Mills Limited. Crescent Board

was the first of its kind designed by a German company to utilize

biogases from its sugar mills for the manufacturing of board.

Rapid expansion during the 1950s and the 1960s made Crescent

Group one of the top groups and among 22 families notarized

families of Pakistan, which dominated Pakistani economy in the

sixties. The Group continued to expand its strength in the textile

sector and incorporated Shams Textile Mills Limited, which was

primarily engaged in manufacturing and trading of high quality

yarn. The late 60’s (1967) saw the emergence of Shakarganj

Mills Limited as the Group continued to gain its hold in the sugar

sector of the country.

The end of the decade, Crescent Group had emerged as one of

the most prestigious and strongest business conglomerate of the

country

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1980s and 90s – Shift of Group’s Focus towards Financial and

Engineering Sectors

The sponsorship and management of the Group realized the

potential of Pakistan’s growing financial sector and decided to

make inroads into it in late 80s. The Group established Pakistan

Industrial Leasing Corporation Limited in 1987 and successfully

undertook leasing business in the country. This was followed by

the establishment of Crescent Investment Bank Limited, which

was among the premier investment banking institution in the

country. The Bank dominated the Pakistani investment banking

scenario for almost a decade until it acquired Pakistan’s

operation of a multinational financial institution, Mashreq Bank

psc, to form Crescent Commercial Bank Limited in 2003. The

merger gave Crescent group a completely new image in the

financial sector as it became the owner of a full scale commercial

bank in the country.

The Group further diversified its focus towards other sectors of

the economy and incorporated Crescent Steel and Allied

Products Limited in 1983. It is one of the downstream industries

of Pakistan Steel Mills, manufacturing large diameter spiral arc

welded steel pipelines. The company has become one of the

most well written success stories of the Crescent Group and

stands as the leading private sector steel engineering company

in Pakistan.

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Further inroads into the financial sector were made by the group

in early 90s when it established 3 new Modaraba companies.

First Crescent Modaraba, among them, become one of the

largest modaraba companies in Pakistan in years ahead. First

Crescent Modaraba in the years to follow turned out to be the

parent company of the existing Crescent Standard Investment

Bank Limited, which is now the largest investment bank in

Pakistan.

The Group also tapped into the country’s housing finance sector

and incorporated International Housing Finance Limited in 1990.

Besides establishing the new companies in the financial sector,

the Group also started a series of takeovers and acquisitions and

acquired Crescent Leasing Corporation Limited as part of its

expansion strategy in the sector.

Crescent Leasing Corporation Limited now stands among the

most reputed and well renowned leasing companies in the

leasing industry. The group entered the brokerage services in

1995 and took over Shoaib Capital (Pvt.) Limited to rename it as

Crescent Capital Management (Pvt.) Limited.

Current Decade – Finalization of the Group’s

Strategy towards

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Financial Sector

In early 2000’s, the Group paced up its acquisitions and bought 3

leasing companies in 2002 namely Paramount Leasing Limited,

First Leasing Corporation Limited and Pacific Leasing Company

Limited.

Leasing Company Limited.

During the same period a Modaraba company was also acquired

and latter renamed after equity injection as Crescent Standard

Modaraba. The Group carried on its acquisition spree by further

acquiring a brokerage firm Crescent Standard Brokerage in

2002.

The Group also undertook rapid maneuvers in the banking sector

to reduce the number of companies and formulate a stronger

financial institution rather then operating several different banking

companies at the same time. Al Towfeek Investment Bank was

acquired by the Group and it was merged with First Crescent

Modaraba to be re-named as First Standard Investment Bank

Limited in 2002, which was renamed to Crescent Standard

Investment Bank Limited.

In another Group merger Crescent Investment Bank Limited

acquired Pakistani operations of Mashreq Bank and both these

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financial institutions got merged to form Crescent Commercial

Bank Limited in 2002.

In yet another merger in 2003 Pakistan Industrial Leasing

Corporation Limited, Trust Investment Bank Limited, Fidelity

Investment Bank Limited and Doha Bank’s Pakistani operations

all merged to form Trust Commercial Bank Limited. In a bid to

further streamline the banking operations of the Group Trust

Commercial Bank Limited was merged into Crescent Commercial

Bank Limited in October 2004.

First part of the group’s financial sector penetration strategy was

to acquire and establish companies with diversified operational

bases and the second phase which was the consolidation phase

saw some of the most pioneering and complex mergers in the

history of Pakistan in respect of the number of companies

involved. Crescent Standard Investment Bank Limited, which

now stands as the largest investment bank in Pakistan, is also

the result of multiple mergers and acquisitions involving 7 of the

above mentioned companies that were bought in the nineties and

early 2000s.The latest acquisition undertaken by the Group is in

the energy sector. Altern Energy Limited was taken over by the

Group in early 2005.Crescent Group now runs its fastest growing

financial sub-conglomerate by the name of Crescent Standard

Group, which is lead by Mr. Altaf Saleem, Mr. Ahsan Saleem and

Mr. Anjum Saleem, who represent the third generation of the

Crescent family.

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Following table depicts the chronology of developments

(incorporations and acquisitions only) that were followed by the

Group in entering new business

venues over its history.

Company Date of Incorporation /

Acquisition by

Crescent Group

Crescent Textile Mills

Limited

1950

Muhammad Amin

Muhammad Bashir

Limited

1951

Premier Insurance 1952

Crescent Sugar Mills

Limited

1959

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Crescent Jute 1964

Shakarganj Mills

Limited

1967

Shams Textile Mills

Limited

1968

Crescent Board Mills

Limited

1977

Crescent Steel &

Allied Products

Limited

1983

Suraj Cotton Mills

Limited

1984

Pakistan Industrial

Leasing Corporation

Limited

1987

International Housing

Finance Limited

1990

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First Crescent

Modaraba

1990

Crescent Standard

Business

Management

1990

Crescent Investment

Bank Limited

1989

Crescent Software

Products Limited

1992

Crescent Bahuman

Limited

1993

Crescent Leasing

Corporation Limited

Taken Over in 1993

Crescent Capital

Management (Pvt.)

Limited

Taken Over in 1995

Crescent Commercial

Bank Limited

2002

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Crescent Standard

Brokerage

2002

Al-Towfeek

Investment Bank

Taken Over in 2002

Crescent Standard

Modaraba

Taken Over in 2003

Fidelity Investment

Bank Limited

Taken over in 2003

Safeway Mutual Fund Taken Over in 2003

Asian Stocks Fund Taken Over in 2004

Altern Energy

Limited

Taken Over in 2005

Employee’s Detail

Males 5553

Females 968

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Management 387

Residing on the plant 2197

Travelling daily 3796

TOTAL 6521

Customers

Levi’s (World Wide) Mustang

Stonage GAP

Blend Big Star

Ben Shermen Carrera

Nautica Jeans Co. Mc Gordon

Espirit Identity

Denim Arezona

Colorado Limited Express

Products and Services

Jeans

Shirt

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Upper of jeans

T- Shirts on demand

Levis

Express

keys to success of CBL:

1. Establishing and maintaining working relationships and

2. contractual agreements with manufacturer.

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3. Bringing the new facility to maximum production within

4. three years of operation.

5. Increasing our profit margin to seventeen and one-half

6. percent (17.5%) with the use of improved technology in the

new facility.

7. Effectively communicating to current and potential

8. customers, through targeted efforts, our position as a

differentiated provider of the highest quality Arabica beans in the

9. world I am going to make a report on Crescent Bahuman

limited to know role of Crescent Bahuman in textile sectors for

development of Industrial sectors. Crescent Bahuman today,

represents the most efficient and successful organization that

has grown with time, experienced in Pakistan. A major jeans

manufacturer in the context of Pakistan, has a wide scope and

size, it symbolizes a fully growing tree evergreen, strong, and

firmly rooted.

My first purpose in Crescent Bahuman limited its operation how it

works, and how it deals in imports and exports material it is an

integral part of modern economic system. The principle of trade

is first concentration of wealth and profit maximization, and then

concentration of resources its first purpose is to fulfill the

economic need of nation and its members.

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During last 20 years, Crescent Bahuman has concentrated on

growth through improving product and service quality by using

the technology and people utilizing its extensive techniques to

increase work developing at large scales and stable the image of

the company in the eyes of the international community and

managing its non performing loss via improved risk management

process.

Crescent Bahuman today, represents the largest company

in the whole Asia that has grown with time, experience in

Pakistan. That organization is now trading the jeans in whole of

the world and gaining the name in the international community,

on the behave of its manufacturers.

Crescent Bahuman has a interesting and great impressive

environment in jeans and denims production. The level of the job

satisfaction increase in working CBL and productivity is also

increased.

Goals and objectives: Our Goal is to serve the needs of the customer.

To accomplish this, we will represent buyers and sellers with

their transactions with the highest degree of professionalism.

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Specializing in large manufacturing jeans transactions, Crescent

Bahuman Management has over twenty five years experience

listing and selling jeans and other items in whole of the world.

Compiling detailed information, knowledge of the industry and

the ability to get along with people is the foundation of our

business.

The main objective of the Crescent Bahuman is to fulfill the need

of the jeans of high standard for its customers and dealers

Its goal is to maximize the profitability and cost minimization of

the product related the jeans manufacturing.

In Asia Crescent Bahuman is the largest factory in the

manufacturing of the jeans wears and denims and manufacturing

of thread. Its goal is to compete all around the world for improve

its standard.

The goal of the Industrial Technology Cooperative Education

Program is to allow the employee to participate in a broad

spectrum of manufacturing, with the assistance of an industrial

enterprise. To achieve this goal, programs devoted to practical

industrial situations and disciplines are exposed to the

technologist from both an industrial and an academic view. A

further academic requirement for the employee are to have a

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general education background in humanities, and in social and

behavioral sciences.

Financial objective:

Gross Sales

How much will you sell this year, next year, in 5 years?

Cost of Goods

What will you pay for the goods you sell & can it be reduced?

Net Income

How much will increasing Sales and reducing costs change your

net?

Return on Investment

How can your increase the productivity of your investment?

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Marketing objectives:

Sales Dollars –

Quantify projected sales in dollars.

Sales Units –

Quantify projected sales in units.

Market Share –

What % of the total market will you sell?

Distribution Channels –

What channels will you use? Retail, Wholesale, Contract?

Strategy and strategic planning

Manufacturing strategy and strategic planning are critical to an

industry's success. Although research in this area has increased

in the last decade, the focus of much of that work has been on

the content rather than the process of the manufacturing

strategy.

If you look at most manufacturing industries today you will see

that the planning process is found to be a bottom-up approach

from a corporate or business perspective, which differs from the

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top-down planning process that has proven to be so successful

in other industries.

A good manufacturing strategic plan combines some "rational"

elements (formality, comprehensiveness, control focus, longer

horizon) with others that lend adaptability (wider participation and

more intense interaction). If you can have this type of strategic

planning, your manufacturing business is sure to be a much

greater success. There will be less waste and higher profits.

Why it is important to have a manufacturing strategic plan for the

Crescent bahumabn:

1. Even the smallest amount of waste per item or time adds up

incredibly fast when you take into account the sheer numbers

and volume of what is being manufactured. For example,

whether it is the manufacturing of one thousand jeans a day or

denims, waste means money. The numbers do not have to be

this large for the principle to stay the same. Any wasted time or

material is wasted money. A strategic plan can help to eliminate

waste, streamline efficiency, and thus mean larger bottom lines.

2. While waste is a big issue, quality is even bigger. If you have a

strategic plan it is like setting up a check and balances system.

Nothing moves forward until it is complete, which means, the job

is done. You do not have waste, but you also do not have

dissatisfied customers because things are done poorly or

incorrect.

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3. A plan gives people a goal and something to work toward.

Working just to work is not common. However, working toward

something, and having an end game is motivation. While for

many their motivation is a weekly, biweekly, etc. paycheck,

showing that person how they fit in your overall plan, and how if

they don't fit, they don't get paid becomes motivation inspired by

a strategic plan.

There are tons of reasons why having a manufacturing strategic

plan is critical to your business. Bottom line, without one you

waste time, energy, and money; three things no one wants to

waste.

ORGANIZATIONAL STRUCTURE:CBL comprises of nine divisions, 14 Departments and 47

Sections. These departments are

Departments of CBL:

1) Human Resources

2) Finance

3) Information technology

4) Engineering (Mechanical, Electrical, and Power house)

5) Marketing

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6) Supply chain

7) Industrial Engineering

8) Product Development

9) Spinning

10) Weaving

11) Cutting

12) Sewing

13) GWP

14) Quality Assurance

Departments and Their Abbreviations:

GQ Garment Quality

HR Human Resource

BFL Bahuman Forestry Limited

IT Information Technology

PG Power Generation

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SY Security

IE Industrial Engineering

SW Sewing

SV Services

SCH School

WP Garment wet Processing

HO Head Office

IR Industrial Relation

CV Civil

CT Cutting

WV Weaving

QA Quality Assurance

Management hierarchy

CHIEF EXECUTIVE OFFICER (E1)

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PRESIDENT OF FINANCE

(E2)

VICE PORESIDENT OF FINANCE (E3)

ASSISTANT VICE PRESIDENT (E4)

MANAGER OF FINANCE (M1)

SENIOR DEPUTY MANAGER (M2)

JUNIOR DEPUTY MANAGER (M3)

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SENIOR ASSISTANT MANAGER (M4)

JUNIOR ASSISTANT MANAGER (M4)

S1

S2

S3

S4

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S5

OFFICE BOYS

Human Resource and Strategy

A. HR department plays a linkage role between the

processes, strategies, and people. The main function of this

department is to facilitate the stakeholders.

B. Recruitment and selection process fulfill the future

requirements of talented sourcing and their appointments or

entry in the organization. Once a new employee or associate

selected his naturalization process begins.

C. Training and development function is directed towards

individuals, who have potential to grow and commit for long term

association with CBL.

Three main areas: Human Resource

Industrial Relation

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Co- workers services

Objectives:

To ensure alignment of people, processes, strategies and

facilitate the organization in concern of to achieve the CBL goals.

Make people in term of to achieve the personal and professional

objectives fulfilled.

Services:

Establishment and implement of all HR related policies and

procedures

Determine the training needs of managers and ensure their

development through external internal trainings programs

Bring positive change in attitude and personality

Develop the sense of ownership at all levels

Ensure the employees and organization development

Implement the orientation training at all level

Ensure the fair and equitable pay structure

Ensure the international quality standard

Dyeing Deptt:

40


Sewing Deptt:

41


42


43


WEAVING DEPTT:

44


Quality Assurance Deptt:

Production and quality assurance are synonymous while assuming

the case of crescent Bahuman. The concept of quality circles was

much before introduced at CBL while other organizations in the

industry just thinking on it. Modern quality control and assurance

systems and techniques i.e. ISO 9001, ISO 14001, WRAP, Organic

Cotton Certification-OE & GOTS etc have been implemented at CBL.

The company places highest emphasis on manufacturing of its denim

products with consistent quality by incorporating efficient and flexible

process to ensure customer satisfaction. Total quality management is

achieved through effective control and continuous improvement of

every process. Quality assurance department of CBL cab be divided

into two areas as given below:

Fabric Quality

Garment Quality

Crescent Bahuman produces high quality denim products. CBL

produces both finished garments as well as fabric, therefore,

monitoring of product quality standards is given high priority so that

customers are not only satisfied, but also repeat business opportunity

is created. Fabric quality is looked after at different stages. Spinning,

weaving, ball warping, dyeing and finishing etc. While garment quality

45


is closely monitored by the DM level resources during the process of

garment Wet Processing and Sewing.

Quality Statement of CBL:

Crescent Bahuman Ltd places highest emphasis on manufacturing of

its denim products quality with consistent quality by incorporating efficient

and flexible processes to ensure customer satisfaction. Total Quality

management is achieved through effective control and continuous

improvement of every process. Our Quality management system include

Effective management Leadership Involve every person in implementing

continuous improvement with sense of ownership providing conducive

work environment Provision of resources and their optimum utilization .

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Values of CBL

Leadership :

Walk the talk

Empowerment

Problem resolution

Accountability:

Ownership of responsibility

Acceptance of mistake

Use of authority

Team Work:

Sharing and participation

Team Spirit

47


Facilitate Alignment

Growth:

Result orientation

Innovativeness

Willingness to learn

Main Designations at CBL:

Executive E1 to E5 (EVP, SVP, AVP)

Managerial M1 to M6 (SM, SDM, DM, SAM, AM)

Staff

grades

S1 to S2(officers, Junior officers, &

supervisors)

Work man S3 to S5 (operators, Senior operators, and

assist operators)

48


FINANCE DEPARTMENT

Finance is an art of managing money. And for this purpose, CBL

has formulated a finance department to look after the existing

funds and to generate new methods for generating funds. The

Finance department in CBL comprises of well educated,

professional and intelligent personnel who by using their skills

trying to benefit company.

Everyday finance department is busy in such activities that what

new methods to be explored so that cost is reduced and profits

and revenues be increased. As CBL deals in number of activities,

such as purchases both local and import, sales both at national

and international level; then funds are obtained from Banks and

much more. So, Finance department performs the activities of

recording, summarizing and than at the end making decisions in

order to provide cost beneficial solutions.

49


The scope of work covers payroll processing, Imports recording

and updating accounts payable, recording collections and

updating accounts receivable; then the major portion is of costing

and budgeting of every item that is produced in CBL; then the

maintenance, recording and valuation of fixed assets,

negotiations with banks to obtain funds and fair calculation of

interest to be paid annually or quarterly, and in performing all this

complying with all the laws, accounting principles and

regulations. Also, all inventories are in control of finance

department. All records regarding material in and out of company

premises are accounted by finance personnel.

FINANCE DEPARTMENT IN CRESCENT BAHUMAN LTD

Following are the main sections of finance department in CBL.

Payroll

Accounts Payable a) Local

b) Import

50


General Ledger

Costing

PAYROLL:

The payroll division handles payments to all full-time and part-

time employees on a bi-weekly basis. In addition all checks for

the self-insured medical plan, reports for worker’s compensation,

and all other payroll related items are handled by this division.

ACCOUNTS PAYABLE: Import payable and Local

payables when comprised are called account payables in CBL.

IMPORT:

51


This division deal with only to foreign parties such as Levis.

Ben Sherman Paxar international etc.

LOCAL: This division deal only in local parties such as

Sapphire textile, pay hotel expenses mess expenses etc.

GENERAL LEDGER: General Ledger is a mother book of Accounts; it is used to show the chain of suppliers as a whole account in CBL.

COSTING: The estimated cost and actual cost of the CBL products (yarn, fabric, and garment) and their variance analysis is called costing.

Hierarchy of Finance Department

52


53


54


55


56


Before describing my work I want to tell that in finance

department of CBL a software is used that is “ORACLE

FINANCIAL

ORACLE FINANCIAL

Oracle Financial is a complete application for financial reporting,

analysis, budgeting, and planning. Integrating a central source of

management data with powerful analytical tools, Financial allows

businesses to make, manage, and measure decisions across the

enterprise. The system provides businesses with everything they

need to control costs, analyze performance, evaluate

opportunities, and formulate future direction. Oracle Financial is

part of the Oracle E-Business Suite, an integrated set of

application, which is designed to transform your business to an

e-business.

DECISION MAKING:

57


Oracle Financial integrates with oracle general ledger. This

integration eliminates the need for duplicate data entry and

structural maintenance, and thereby provides a more cost-

effective financial management.

In “2002” Crescent Bahuman Limited started Oracle Financial

system for its Finance Department up to “2003”, it was on trail.

After that it was accepted and in “2004” audit of Crescent

Bahuman Limited was taken place on this system.

PRIMARY WORK:

I have divided my work in following parts:

Payroll

Reconciliation Statement

Preparation of cost sheet

Transaction in Oracle

58


PayrollIn a company payroll is the sum of all financial records of

Salaries, Wages, Bonuses and Deductions

Salary Slip

Earnings

Salary (Basic Salary):

The first item in the employee’s payroll statement (salary slip) in

his / her basic salary. The basic salary is based on his / her

grade and decided by the H.O.D.

The employee grades are divided into 3 categories

Category 01: S6, S5, S4, S3, S2, S1

Category 02: M6, M5 M4, M3, M2, M1

Category 03: E5, E4, E3, E2, E1

Overtime:The duration of maximum overtime is 12 hours other than the

routine working hours in a week. The overtime is done by

employees in condition when orders are in large quantity within

the less period of time and when in a department some

59


employees are on leave and their left work is divided into

employees in shape of overtime.

Special Allowance:Special allowance is the allowance which is added in the salary

for those who are having grades from S1 and above

Piece Rate: Piece rate is the incentive given to the

workers of Sewing and GWP department on the basis of each

piece being processed. The calculation of piece rate is done by

the Industrial Engineering department (IE)

Piece rate is apply only on S3, S4, S5 grades.

Perks:

Perks are the pre-defined amounts to compensate the day care

medical charges of the employee that are based on the grades of

the employees. This item of payroll statement does not show in

the salary slip of the employee.

S5 and S4 grade employees are not facilitated with perks

amount.

60


The Executives grades (E5-E1) personnel’s perks are

decided by Head Office.

House Rent Allowance: House rent is the 40% of the amount of employee’s Basic Salary + COLA.

Utilities:Utilities are the allowance which is paid to the employees to

compensate the electricity, gas and telephone expenses. Utilities

are the 10%of the amount of the employee’s Basic salary +

COLA.

COLA (Cost of living allowance):

COLA is the allowance that is directed by the Govt. to CBL to pay

to the employee with his / her salary. COLA is fixed amount for

every employee of any grade i.e. Rs. 100 Only.

Deductions:

Utility Expenses

61


Utility expenses are the electricity, Telephone and gas expenses

that are consumed by the employee and are showed as each

item separately in the employee’s salary slip.

Mess Charges

Mess charges are included in the deduction section of salary slip

of those employees that are availing the accommodation of the

CBL. CBL accommodation is divided into four hostels according

to the grades of the employees. These four hostels are Workers,

Senior Grades Hostel (SGH), Junior officer hostel (JOH), Senior

officer hostel (SOH). SGH, JOH, SOH mess is maintained by

these hostels itself and resident of that hostels are being charged

the mess expense as per their attendance. The residents of

workers hostels have to maintain their own mess system or they

can avail the facility of Canteen Cook House at charges

Income Tax:An employee who is being paid Rs. 200,000 or above comes

under deduction income tax which is applied on the employee’s

salary at different ratios according to the amount of the employee

School Fee of the children of employee:

62


CBL is providing the facility of state-of-the –art education to the

employee’s children. The fees are charged to the employee’s

according to their grades and are shown in deduction section of

the employee’s salary slip.

Excess Salary and Excess Perks:

If by mistake in the entries the employee salary or perks are

entered in excess of amount to the actual amount, then in the

next month salary slip of the employee, the excess salary or

excess perks are shown in the deduction section of salary slip.

Provident Fund Contribution:

Provident fund is the lump sum amount that is paid to the

employee at the time of his /her termination/retirement of the

employee. Anyhow an employee can avail the facility of the

provident at any time during his /her job but he / she can only

withdraw a specific amount generally half of the total amount of

provident fund at that time is accumulated. 8.33% of basic salary

63


+ COLA will be deducted from employee salary and the same

amount is contributed by the CBL.

Employee Old Age Benefit Institution (EOBI):

EOBI is 1% of the salary amount that is deducted from the salary

amount and added in EOBI for the purpose of employee’s

pension after his / her retirement. EOBI is run by the GOVT. and

that deduction is carried forward to the EOBI account.

Sports Fund:

Sports fund is fixed deduction in the salary slip for the employee

of S1 and above which is Rs.15

Club Fund:

Club fund is also a fixed deduction for the employee having

grades from S1 to above i.e. Rs 50

Welfare Fund:

Welfare fund is the deduction of Rs. 100 that is deducted only

from the salary of AM and above grades managers.

64


Milk Deduction:

CBL is also having a dairy farm where the residence of CBL can

access the fresh milk everyday and total amount of the whole

month milk expense will be deducted from the salary at the end

of the month.

Store Deductions:When an employee joins the CBL, he /she is provided some

equipment according to his / her job requirement from the main

store, when he / she left the organization he /she has to return

that specific equipment, in case of missing anything a deduction

is being taken in his/ her Final Settlement.

Wheat Recovery:CBL is also having a farm where the residence of CBL can

access the Wheat / Rice at every season and the total expense

is deducted from the salary at the end of the month.

Advances: An employee of CBL can avail the facility of taking advances

(Loans) in form of cash if he / she needs for some emergency

usages. The advances are based on employee’s Salary and

Provident Fund.

65


Provident Fund facility the employee can avail 40% of PF as a

loan and it is deducted from his /her salary in “12” equal

installments with one extra installment equal to the amount of

one installment.

FINAL SETTLEMENT ACCOUNT

Final Settlement is a legal document which is prepared for the

employee who has left the organization with some certain

reasons i.e. in case of:

Probation period

Dismissal

Resignation

Retirement

Death of Employee

On the basis of above five reasons of the separation of the

employee, the HR department prepares a clearance certificate

and an Office Letter of that specific employee. In Clearance

certificate the information consist of employee’s bio data Like

Employee Name, Code, Code Grade, Department, Joining and

66


termination date, Earned Leaves, No. of days worked in the

leaving month etc. The Clearance certificate rotates from

different departments for the purpose of clearance just in case for

if any amount or item is recoverable from that specific

department. The main concern departments of Clearance

Certificate are:

Store

School

Mess

Security Office

IT

HR

Finance

After the clearance from these departments, HR hand over that

clearance certificate to the Finance department along with an

copy of an Office letter and some other documents according to

the employee ‘s separation reason i.e. Resignation Application,

Retirement Application etc. The office letter is the letter of

termination which is, firstly send to the specific employee for the

purpose of Final Settlement.

67


Now on the basis of Clearance Form and Officer Letter, the

payroll section of the Finance Department prepares the Final

Settlement Document Slip which illustrate the Net amount

payable to or Receivable form of that specific terminated

employee. That process is executed through Calculating the

Total Payables and Total Deductions on the basis of Clearance

Certificate and some different account Reconciliation MS Excel

worksheet. The detail of the total payables and total deductions

are as follows:

Total Payables I.e. Payable before Deductions: Salary Days Leave Encashment Overtime Piece Rate/ Production Incentives Notice Pay Others

Total Deductions: (Deduction as per Clearance Certificate)

Advances Mess Bill Electricity Bill Telephone Bill Notice Pay

68


Others

When Full and Final Settlement Accounts Document slip of each

employee is being completed, then that manual transactions to

an IT based application software( Oracle Financial) for the

purpose of final settlement Invoices and Vouchers of each

employees.

Invoices and invoices based vouchers are further divided into

their sub-categories on the basis of Final Settlement account

slips which indicates whether the employee lies in the category of

payable to or Receivable form.

Types of Invoices and Vouchers for Payable To Category:

Standard Invoices Journal Voucher Payment Voucher

Types of Invoices and Vouchers for Receivable From category:

Debit Memo Standard Invoice Journal Voucher

69


The Execution of Journal and Payment Vouchers for Payment Purpose

With the help of different commands in the Oracle Financial, the

standard invoices are converted into Journal and Payment

vouchers and finally their printed form is attached with the Final

Settlement Slip and Clearance Certificate of each terminated

employee and carries forward to the authorities for its approval

so that the terminated employee’s payment can be made.

In case of Receivable From Employee’s, only the Journal

Vouchers is being prepared and receivables are adjusted in the

Provident Fund Final Settlement of the employee.

RECONCILIATION STATEMENTThe purpose of this exercise is to reconcile own company’s

statement with the records of other company. A valuable thing

about a checking account is that it provides a double record for

the depositor--one maintained by the company (depositor) and

the other by the bank.

The bank’s record, called a bank statement, is sent periodically

(usually monthly) to the company. Whenever a bank statement is

received, for control purposes an appropriate person within the

70


company should reconcile the bank statement with the

company’s own records.

This reconciliation accounts for differences between the two

records. These differences are usually one of two types: one is

comprised of “lag” by the bank or the company. Of course, once

identified, errors can be corrected

Furthermore, the company is assured of the amount of cash

available to it at the bank. For the best control, many companies

reconcile both balances and transactions.

This assures that the bank account is not being used for

unauthorized purposes—for example, an unauthorized deposit

and withdrawal for the same amount.

STANDARD WAY OF RECONCILIATION:

Bank statement closing balance for period

A

Plus unreconciled AR B

Less unpresented Cheques

C

Plus unreconciled CE lines

D

71


Plus/minus manual corrections

E

Equals Bank balance

F

Gen. Ledger account bal for period

G

Result

F=G

In the above formula, we would work out the manual corrections

ourselves, but we expect to get the other totals from the cash

management report.

COST SHEET

A competitive product must address factors such as cost,

performance, aesthetics, schedule or time-to-market, and quality.

The importance of these factors will vary from product to product

and market to market. And, overtime, customers or users of a

product will demand more and more, e.g., more performance at

less cost. Cost will become a more important factor in the

acquisition of a product in two situations

First, as the technology or aesthetics of a product matures or

stabilizes and the competitive playing field levels, competition are

increasingly based cost or price.

Second, a customer’s internal economics or financial resource

limitations may shift the acquisition decision toward affordability

72


as a more dominant factor. In either case, a successful product

Supplier must focus more attention on managing product cost.

When a company faces a profitability problem and undertakes a

cost reduction program, it will typically reduce research and

development expenditures and focus on post-development

activities such as production, sales, and general and

administrative expenditures.

DEFINITION OF TERMS:

The following definition of terms will provide a common

basis for discussion:

Recurring production cost = Production labor + Direct

materials +Process

costs + overhead + outside processing

Non-recurring costs = Development costs + Tooling

73


Product costs = Recurring production costs +

allocated non-recurring costs

Product price or acquisition = Product costs + selling,

general &

Costs administrative + warranty

costs + profit

Life cycle costs = Acquisition costs+ other related

capital costs + training costs +

operating costs + support costs + disposal costs.

PREPARATION OF COST SHEET

It shows that what type of material CBL purchased including

its total cost

PURPOSE: Its purpose is to record the expenses.

To find out the total cost of import.

To find out the per unit rate.

IMPORTANT THINGS: Three things are necessary

74


Estimated cost sheet No.

Control No.

Purchase order No.

DOCUMENTS:Following documents are necessary for the preparation of cost sheet. Supplier’s Invoice Agent’s Bill Freight Bill Form of taxAfter the completion of above requirements we can prepare cost sheet by using computer.

75


SECONDARY WORK

VOUCHERS FOUNDING

VERIFICATION OF VOUCHERS, COST SHEET AND

TRANSACTION

CORRECTION OF VOUCHERS, COST SHEET AND

TRANSACTION

PRINTING OF VOUCHERS,COST SHEET AND

RECONCILIATION STATEMENT

BOX FILLING OF VOUCHERS

76


77


CRESCENT BAHUMAN LIMITEDPROFIT AND LOSE ACCOUNT FOR YEAR ENDED

JUNE 30,20……………. JUN 30,

JUN 30,

JUN 30,

JUN 30, JUN 30,

2,005 2,006 2,007 2,008 2,009(Rupees in Thousands)

Sale 2176445 3146212 4115979 5085746 6055513

Cost of good sold 1749312 2413997 3078682 3743367 4408052

Gross profit 427133 732285 1037437 1342589 1647741

Admin & Selling exp 265849 241513 217177 192841 168505

Other income 40844 29668 18492 7316 -3860

Profit from operations 202128 520439 838750 1157061 1475372

Finance cost 137161 288453 439745 591037 742329

Other Charges 3983 9795 15607 21419 27231

141144 298248 455352 612456 769560

Profit before taxation 60998 222191 383384 544577 705770

Provision for taxation 18521 33238 47955 62672 77389

Profit after taxation 42463 188954 335445 481936 628427

78


CRESCENT BAHUMAN LIMITEDVertical Analysis of Profit & Loss Account

For the half year ended June 30, 2010

JUN 30,

JUN 30,

JUN 30,

JUN 30,

JUN 30,

2,005 2,006 2,007 2,008 2,009%

Sale 100 144 130.8233 123.561 119.0683

Cost of good sold 100 137.9969 127.5346 121.5899 117.7563

Gross profit 100 171.4419 141.6712 129.414 122.7286

Admin & Selling exp 100 90.84593 89.92352 88.79439 87.38028

Other income 100 72.63735 62.32978 39.56305 -52.7611

100

Profit from operations 100 257.4799 161.162 137.9506 127.5103

Finance cost 100 210.3025 152.4494 134.4045 125.5977

Other Charges 100 245.9202 159.3364 137.2397 127.1348

100 211.3076 152.6756 134.5017 125.6515

Profit before taxation 100 364.2595 172.547 142.0448 129.5997

Provision for taxation 100 179.4612 144.2776 130.6892 123.4826

Profit after taxation 100 444.985 177.5273 143.6706 130.3964

79


CRESCENT BAHUMAN LIMITEDHorizontal Analysis of Profit & Loss Account

For the half year ended June 30, 2010 JUN 30,

JUN 30,

JUN 30,

JUN 30,

JUN 30,

2,006 2,007 2,008 2,009 %

Sale 100 100 100 100 100

Cost of good sold 80.37474 76.72709 74.79829 73.60507 72.79403

80


Gross profit 19.62526 23.27513 25.20511 26.39906 27.21059

Admin & Selling exp 12.21483 7.67631 5.276436 3.791794 2.782671

Other income 1.876638 0.942975 0.449273 0.143853 -0.06374

Profit from operations 9.287071 16.54177 20.3779 22.75106 24.36411

Finance cost 6.302066 9.168263 10.68385 11.62144 12.25873

Other Charges 0.183005 0.311327 0.379181 0.421157 0.449689

6.485071 9.47959 11.06303 12.0426 12.70842

Profit before taxation 2.802644 7.062175 9.314528 10.70791 11.655

Provision for taxation 0.850975 1.056445 1.165093 1.232307 1.277992

Profit after taxation 1.951026 6.005762 8.149823 9.476211 10.37777

CRESCENT BAHUMAN LIMITED Balance Sheet

As At June 30,200…….. JUN 30,

JUN 30,

JUN 30,

JUN 30,

JUN 30,


Authorized Capital600,000 shares rs.10/-each 600,000 600,000 600,000 600,000 600,000

81


Issue, Paid up capital 600,000 600,000 600,000 600,000 600,000Profit & Loss a/c 42,463 188,954 335,445 481,936 628,427

127,184 165,466 812,289 1,053,418 1,395,971Long term loans 362,098 329,968 2,986,678 3,850,828 5,163,118finance lease 109,771 115,946 2,407,830 3,175,908 4,324,938Deffered Libilities Staff retirement 9,962 10,823 13,404 14,838 16,559

481,832 456,639 5,407,912 7,041,541 9,504,581Short term bank borrowings 787,135 950,182 2,249,010 2,790,651 3,521,588

Liabilities 52,847 89,838 226,010 296,061 382,643Creditor,other liabilities 233,644 244,989 1,206,361 1,534,382 2,020,740Provision for taxation 18,521 22,846 51,147 63,464 79,777

1,073,627 1,307,857 3,732,528 4,696,905 6,026,356Total Liabilities 1,682,644 1,929,962 6,547,158 8,251,102 10,683,359Fixed assets 578,182 597,278 6,182,251 8,056,639 10,858,674Long term deposits 2,550 5,554 32,327 43,254 58,143Stores, spares, loose tools 124,260 146,866 469,060 591,529 763,929Stock in trade 544,866 709,655 1,351,005 1,674,648 2,077,717Short term investments 61,440 76,544 1,469,488 1,943,872 2,647,896Trade debets 108,295 165,148 1,299,790 1,715,906 2,311,654Other receives 250,407 279,626 313,728 344,575 376,235

Bank Balance 12,522 24,390 23,507 31,125 36,6171,101,912 1,327,129 3,458,949 4,319,700 5,498,2191,682,644 1,929,962 6,547,158 8,251,102 10,683,359

CRESCENT BAHUMAN LIMITEDVertical Analysis of Balance Sheet

As at 30th June, 2010 JUN 30,

JUN 30,

JUN 30,

JUN 30,

JUN 30,


82


Authorized Capital 100 100 100 100 100

600,000 shares rs.10/-each 100 100 100 100 100

Issue, Paid up capital 100 444.985 177.5273 143.6706 130.3964Profit & Loss a/c 100 130.0997 490.9099 129.6851 132.5182

100 91.12671 905.1417 128.9335 134.0781Long term loans 100 105.6253 276.682 131.8992 136.1796

finance lease 100 108.6428 123.8474 110.7008 111.5983Deffered Libilities Staff retirement 100 94.77141 184.286 130.2081 134.9787

100 120.714 236.6925 124.0835 126.1924

Short term bank borrowings100 169.9964 251.5751 130.9948 129.2444

Liabilities 100 104.8557 492.4144 127.1909 131.6974

Creditor,other liabilities 100 123.3519 223.8773 124.0816 125.7043

Provision for taxation 100 121.8167 285.3927 125.8371 128.3048

100 114.6982 339.2377 126.0257 129.478Total Liabilities 100 103.3028 135.071 130.3189 134.7792

Fixed assets 100 217.8039 582.049 133.8015 134.4211

Long term deposits 100 118.1925 319.3796 126.1094 129.1448

Stores, spares, loose tools 100 130.2439 190.3749 123.9557 124.0689

Stock in trade 100 124.5833 1919.795 132.2823 136.2176

Short term investments 100 152.4983 787.0456 132.0141 134.7191

Trade debets 100 111.6686 112.1956 109.8323 109.1883

Other receives100 194.7772 96.37966 132.406 117.6468

Bank Balance 100 120.4387 260.634 124.8848 127.2824

100 114.6982 339.2377 126.0257 129.478

CRESCENT BAHUMAN LIMITEDHorizontal Analysis of Balance Sheet

As at 30th June, 2010

JUN 30,

JUN 30,

JUN 30,

JUN 30,

JUN 30,

2,005 2,006 2,007 2,008 2,009

83


Authorized Capital (Rupees in Thousands)

600,000 shares rs.10/-each35.6581665

5 31.08879.16428

27.27175

65.61621

1

Issue, Paid up capital35.6581665

5 31.08879.16428

27.27175

65.61621

1

Profit & Loss a/c2.52358787

79.79055

55.12352

15.84086

85.88229

87.55858042

58.57353

712.4067

4 12.76713.0667

8

Long term loans21.5195846

517.0971

245.6179

346.6704

7 48.3286

finance lease 6.52372100

16.00768

336.7767

238.4907

140.4829

4Deffered Libilities Staff retirement

0.592044425

0.560788 0.20473

0.179835

0.155001

28.63540951

23.66052

82.59938

85.34061

88.96622

Short term bank borrowings46.7796515

5 49.233234.3509

433.8215

5 32.9633

Liabilities 3.14071188 4.654913.45203

23.58814

33.58167

2

Creditor,other liabilities13.8855277

812.6939

818.4257

218.5960

818.9148

4

Provision for taxation1.10070817

11.18375

40.78120

90.76915

80.74674

163.8059506

367.7659

5 57.009956.9245

856.4088

1

Total Liabilities 100 100 100 100 100

Fixed assets 34.3615167

630.9476

694.4264

897.6431

9 101.641

Long term deposits0.15154720

80.28777

80.49375

60.52422

10.54423

4

Stores, spares, loose tools7.38480629

37.60978

7 7.164337.16908

77.15064

1

Stock in trade 32.3815376

336.7704

120.6349

820.2960

519.4481

6

84


Short term investments3.65139625

53.96608

822.4446

723.5589

424.7852

4

Trade debets 6.43600191

1 8.5570619.8527

420.7960

821.6378

9

Other receives14.8817575

214.4886

8 4.791824.17610

53.52169

4

Bank Balance0.74418593

61.26375

50.35904

10.37721

8 0.34275

65.48693604

68.76451 52.8313

52.35301

51.46526

100 100 100 100 100

FINANCIAL RATIOS

85


“LIQUIDITY”;

'' A firm’s ability to satisfy its short term obligations as they come due.''

Year involved;

Base year 2008 current yea 2009

ANALYTICAL TABLE;

Name of ratios

2008 2009 result Reason of change

%change

Current ratio

0.97:1 0.8:1 unfavorable decrease in loans and advances

Decrease in other receivables

Decrease in Cash and bank balances

Increase incurrent portion of non current liabilities

Increase in trade and other payables

37.09

29.39

4.65

20.51

37.09

86


Quick ratio

0.768:1 0.6:1 Unfavorable Decrease in loans and advancesDecrease in other receivables Decrease in Cash and bank balancesIncrease in trade and other payablesincrease in current

portion of non current liabilities

37.09

29.39

4.65

20.51

RESULT; The results show that most of the indicators are not favorable or showing positive results .The previous year performance was better than the current year.

REASON FOR CHANGE;

The majority reasons for unfavorable change are decrease in cash and bank balance Increase in current portion of non current liabilities. decrease in loans and advances decrease in other receivables

IMPACT OF CHANGE; The analysis shows that the firms ability to pay off its short term debts has declined in current year as compared to previous years as it is evident from the results of various ratios and it is not having a positive impact on the company.

87


“ACTIVITY”

“The effectiveness of management towards the utilization of resources to generate sales.”

There are two types of Activity:

Turnover Analysis Period Analysis.

YEARS INVOLVED: Base year: 2008 Current year: 2009

FORMULAS:

(a) Turnover Analysis

Total Assets Turnover=Sales/Total Assets

Fixed Assets Turnover=Sales/Fixed Assets

Current Assets Turnover=Sales/Current Assets

Inventory Turnover=Cost of Goods Sold/Inventory

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Receivables Turnover=Sales/Receivables

(b) “Period Analysis”

Collection Period=No. of days in a year/Receivable Turnover

Payment Period-=No. of days in a year/Payable Turnover

Name Of Ratios

2008 2009 Result Reasons For Change

Percentage

Change

Total Assets Turnover

0.685

times

0.623

times

Unfavorable Decrease in loan and advances

Decrease in other receivables

Decrease in cash and bank balances

-37.09%

-29.38%

-4.65%

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Fixed Assets Turnover

1.0 0.81 Favorable Increase in net salesIncrease in property, plant and equipmentIncrease inlong term investmentIncrease in long term deposits

25.27%47.48%

16.82%

0.0138%

Name Of Ratios

2008 2009 Result Reason For Change

Percentage Change

Receivables Turnover

371.3 658.7 Favorable.Increase in sales 25.27%

Average Collection Period

0.98days

0.55days

Favorable Increase in sales 25.27%

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Average Payments Period

530days

480days

Unfavorable Increase in purchases

46.38%

“RESULT”

The ability of cresent bahuman is unfavorable in current

year as compare to the base year because majority of the indicators

calculated are unfavorable in the current year.

“REASON FOR CHANGE”

The reasons of Changes are:

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Increase in fixed assets is much more than increase in sales

Increase in sales is more as compare to current assets

Increase in collection from receivables as compare to last year

“IMPACT OF CHANGE”

Inventory turnover has deteriorated considerably and

is worse than the previous year.

Total Assets are increasing and Sales are also increasing but increase in

total assets is more than sales.

It means that management is not utilizing its resources in a proper way. But

The collection system of the company shows that the management of the

company is efficient in the collection of receivables as compare to the last

year.

SOLVENCY;

''The ability of a firm to pay its long term obligations as they come due''.

YEARS INVOLVED; Base year; 2007 Current year; 2008

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%changeReason for change

result20092008

Name of ratio

29.71%

43.42

50.87

Increase in net sales Increase in gross profitIncrease in operating income

Favorable

3.58:12.76:1

Time interest earned ratio

2.645-

35.06-

31.76-

20.59

47.485

82.39

16.83

0.0138

19.29

0.4814

Decrease in long term financingDecrease in profit/other charges payableDecrease in provision for taxation

Decrease in sales tax

Increase in property,plant and equipment

Increase in investment property

Increase inlong term investmentIncrease in long term depositsIncrease in stocks, spare parts

Increase instock in tradeincrease in trade

Favorable

0.51:10.71:1

Debt ratio

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45.42613.87

4.65

debts increase in trade deposits and short term prepaymentsincrease in investmentsincrease in cash & bank balances

RESULT;

The indicators show that the company is in favorable position to pay off its long term obligations in current year than the previous year.

REASON FOR CHANGE;

The basic reasons for this change are;Increase in cash & bank balancesIncrease in investmentDecrease in long debts

IMPACT OF CHANGE;

The company is very efficient in paying its long term debts and its

ability has increased in the current year than in the previous year. it is

having a very positive impact on the repute of the company and in

attracting more investors towards the company .

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“PROFITABILITY”

“The ability of business to generate return for owner.” OR

“The overall effectiveness of management is called profitability

YEARS INVOLVED:

Base year 2007 Current year 2008

FORMULAS:

(a) General Profitability Analysis

Gross Profit ratio= Gross profit Sales

Operating Profit ratio=Operating Profit *100 sales Operating Ratio=Operating Cost *100 Sales

Net Profit Ratio=Net Profit *100 Sales

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(b) “RETURN ANALYSIS”

Return On Assets=Net Profit *100

Total Assets

Return On Equity=Net Profit *100 Total Equity

Return On Investment = Net Profit *100 Amount Invested Within business

Name Of Ratios

2008 2009 Result Reasons For Change

Percentage

Change

Gross Profit Ratio.

24.8%

28.4% Favorable Increase in sales 27.25%

Operating Profit Ratio.

19.5% 23.53%

Favorable Increase in rental income.Increase in profit on deposit.Increase in gain on disposal of investment property.Gain realized on sale of investment property.Increase in other income

152.2%47.82%

6444.2%

100%

6.75%

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Net Profit Ratio.

8.53% 11.36

%Favorable Increase in rental

income.Increase in profit on deposit.Increase in gain on disposal of investment property.Gain realized on sale of investment property.Increase in other income

152.2%47.82%

6444.2%

100%

6.75%

Operating Ratio

81.14% 77.65

%Unfavorable Increase in operating

expenses27.43%

“RESULT” The results show that the majority of calculated indicators are showing positive results. It means the current year’s performance of CBL is better than previous year.

“REASON FOR CHANGE”

The major reasons of favorable probability are;

Increase in sales. Increase in net profit. Increase in assets. Increase in operating income.

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“IMPACT OF CHANGE”

There is an increase in gross profit, operating profit,

net profit which means that indicators are covering all commercial expenses

like interest finance cost also providing the enough amount for reinvestment

of R/E.these indicators are also showing that there is an increase in asset

as sales and operating income of company but on the other hand net profit

is more as compared to capital employed operating cost of company has

increased this year but sales and operating income are covering it.

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SWOT ANALYSIS

STRENGTHS:

Biggest UnitBiggest unit in South Asia and exports 9 billion geans per year..

Independent Manufacturing Firm

The organization is completely independent manufacturing firm,

it takes cotton as input and gives output in the form of

garments, fabric, and yarn.

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Quality ConsciousQuality is the main factor for the success of any organization.

That’s why CBL is ISO 9001 certified company for his quality

products.

Own power generation plantCBL is having its own power generation plant. So can’t be

affected by energy crisis faced by the industry now days.

No illiterate laborIlliterate labor intake is zero, minimum education level for

worker class is middle but primary is also accepted.

WEAKNESSES:

High turnover rateTurnover rate is very high at worker level, which effects the

hiring and trainings cost.

Complex HierarchyManagement is divided into many levels (like SAM AM and

JAM) so low career development chances for management

level employees.

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Marketing Department cost There is a market department in CBL but is not that much

effective as it should be as marketing department of being the

biggest unit of South Asia.Other competitor are spending more

on it as compare to CBL

No Advertising

Local sales are very low, Because no advertisement on radio or

T.V. by using advertisement in local country it can increase its

sales.

OPPORTUNITIES

First movers

CBL enjoys opportunity of first movers in that industry. So is

much developed and well reputed in the industry internationally

Still Biggest contractor of LEVI STRAUSS

LEVI STRAUSS is the most renounced brand of jeans, and

CBL is the biggest manufacturer of LEVI STRAUSS in Pakistan

yet.

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Economical Barriers To new entrants

The industry is quiet expensive to enter for any new comer,

especially in the current scenario of economic and energy

crisis.

THREATS

Market share is divided with competitors

Now LEVI’s has given a part of the contracts to new firms like

US Apparel and Auzgard.

Foreign investors

Foreign investment in textile sector in Sri Lanka, Bangladesh

and India is a danger in future for Crescent Textile Mills .

Dumping duties

South Africa is thinking about to impose the anti-dumping duties

on Pakistan textile exports. If it is imposed, a reasonable export

share and big market may be lost.

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RECOMMENDATIONS

Analyzing all the chapters conclusions and the interviews and

surveys that I have conducted, it is finally concluded that CBL

management is working in a more focused and formalized

manner.

However, to achieve their objectives successfully on the

International standards, the following suggestions are offered:

The CBL should also take interest in the local marketing to

increase the profit.

It is recommended to CBL that they should go for news paper

advertisement also, both for recruitment purpose

It is recommended to the CBL management, that the

department mangers must also be given opportunity to go

abroad for updated training courses.

The CBL management must also arrange local training

sessions for special purposes to be refreshed after every 3-4

months, like stress management, time management, crises

management etc.

As the turnover rate is very high, the management should look

for the reasons and take effective steps to overcome the causes

and not only the symptoms.

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Case studies must be conducted and training literature must

be provided to the top Management (Managers and Deputy

Managers).

CONCLUSION

I got a lot of experience from Crescent Textile Mills. During my

internship we came to know that how the different activities take

place, what are the procedures

The Crescent Textile Mills is on the way of progress. It has

been earning profit for the last five years. The management is

professionally qualified and experienced.

The Crescent Textile Mills should motivate their employees by

providing different incentives. Their salary package is also not

attractive. The performance of the Human Resource

department is also not satisfactory.

Crescent Textile Mill’s product is of high quality. The demand

of Crescent Textile Mill’s products is increasing with the

passage of time. The company is expanding its capacity to

satisfy the demands of their customers. Management of the

company is trying to improve more and more to earn profit and

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improve the economy of the

Pakistan.

GLOSSARY

Accounting :

is an art of recording, classifying, summarizing and also include

the prepration of financial statements for effective decision

making.

Accounting cycle :

Sequence of accounting procedures to record, classify and

summarize accounting information in financial reports at regular

intervals.

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Accounting period:

Period of time required by an income statement.

Account payable :

Account payable are the short term obligation of the business.

Accured income:

Amount that is earned but yet not received.

Close ended shipment:

A shipment which involve the bank for payment.

COSTING The estimated cost and actual cost of the CBL products (yarn, fabric, and garment) and their variance analysis is called costing

Gross profit:

Amount remaining after the deduction of cost of goods sold is

…..

Open ended shipment:

A shipment which hire an agent for payment rather than bank.

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Turnover:

The behavior of employees to leave the job.

Trims and sundries

Term used in cbl for importing the buttons, zips etc.

BIBLIOGRAPHY

For the completion of this Report I collect information from

the following sources

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Search engines:

Name of website Date visited time visited

www.google.com 23-08-2010 10:20am

www.wikipedia.com 23-08-2010 5:30Pm

www.cbl.com.pk 23-08-2010 6:00Pm

28-08-2010 5:15Pm

Practical Internship at:

Crescent Bahuman Limited

Pindi Bhattian

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http://www.cbl.com.pk/

http://www.google.com/


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cresent bahuman limited

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