FINANCIAL SAVINGS THROUGH FIXED ASSETS MANAGEMENT

FINANCIAL SAVINGS THROUGH FIXED ASSETS MANAGEMENT : 

FINANCIAL SAVINGS THROUGH FIXED ASSETS MANAGEMENT MR. ROHAN SUNIL SHIRDHANKAR   FINANCE SPECILIAZATION There is something about steel There is something about ISPAT ISPAT INDUSTRIES LIMITED

ABOUT THE PROJECT TOPIC : 

ABOUT THE PROJECT TOPIC The project topic “FINANCIAL SAVINGS THROUGH FIXED ASSETS MANAGEMENT” clearly mentions the deduction in the expenditure costs, which are in connection with those fixed assets, which are not used in the operational process. The project also concentrates on those assets, which are high on the maintenance cost. It mainly focuses on identification and then disposal of the assets which are idle or which are frequently under repairs eventually increasing the operating cost for production. The first part of the project gives an insight about the different Fixed Assets and the accounting of the fixed assets and the need and procedure for the disposal of fixed assets. The second part of the Project consists of research and analysis to find out whether there is any need to dispose off the fixed assets and investigation to find out which fixed assets can be disposed and which need a replacement.

OBJECTIVES AND SCOPE OF THE STUDY : 

OBJECTIVES AND SCOPE OF THE STUDY OBJECTIVES OF THE STUDY: To discard those Fixed Assets from the Fixed Asset Register, which are not in active use. To discarding those Fixed Assets from the Fixed Asset Register, which are stated at the lower of their net book value. To check whether the method and the rates of depreciation for the Fixed Assets is appropriate as per the Company Act 1956. To ensure Fixed Assets availability where and when needed. To track fixed assets for the purposes of financial accounting, preventive maintenance, and theft deterrence

CONTD : 

CONTD SCOPE OF THE STUDY The study of “Financial Savings through Fixed Assets Management” will help to know which fixed assets are not in active use or idle or which are stated at the lower of their net book value. Also it helps to know the accounting of the fixed asset in case of acquisition, retirement or replacement of the Fixed Assets. The project has also reviewed the procedure for disposal or replacement of Fixed Assets.

RESEARCH METHODOLOGY : 

RESEARCH METHODOLOGY This report is based on primary as well secondary data, however secondary data collection was given more importance. Data was also collected through personal visits to persons, by formal and informal talks. The data has been analyzed by using mathematical/Statistical tool. Data has been presented with the help of bar graph, pie charts, line graphs etc

DATA ANALYSIS : 

DATA ANALYSIS Data analysis consists of Ratio analysis and is divided into two parts. a} ANALYSIS OF THE COMPANY NET FIXED ASSETS TO NET WORTH RATIO FIXED ASSET TURNOVER RATIO. RETURN ON FIXED ASSET REPAIRS AND MAINTENANCE TO FIXED ASSET RATIO b} COMPETITOR ANALYSIS (COMPARISON WITH INDUSTRY AVERAGES) NET FIXED ASSETS TO NET WORTH RATIO FIXED ASSET TURNOVER RATIO. RETURN ON FIXED ASSET

CONCLUSION : 

CONCLUSION The company has invested huge amount in the Fixed Assets, which are having a potential of high productivity and efficiency. It is really difficult to manage such huge amount of Fixed Assets but the company management has successfully able to manage these assets. It can be also concluded that some of the assets are really obsolete and need a replacement with new and improved technology. Also the Fixed Asset Register of the company does not provide the precise information and has some errors, which are to be rectified to manage the fixed assets of the company in a better way. It was also observed that most of the plant of Ispat Industries Ltd are properly maintained and are working at its maximum efficiency. The employees in the plant are not having information regarding the assets. They don’t have the assets number or the acquisition cost or the year of acquisition,etc. There are some equipments which need to be disposed off or needs a replacement but otherwise the plant is well maintained.

SUGGESTIONS AND RECOMMENDATION : 

SUGGESTIONS AND RECOMMENDATION The company should give emphasis to Fixed Asset Management, which will focuses on Acquisition of new Fixed Assets, depreciation on the current Assets, Impairment or Disposal of Fixed Assets and replacement of the obsolete Fixed Assets.   The company should think about the depreciation fund method of calculating depreciation. Where the depreciation for every year is transferred to sinking fund account and then is invested in the market securities, which can earn a profit.   Every Fixed Asset should be given an assets number, which is to be written on that particular fixed asset as it is very difficult to physically locate a particular asset present in the asset register.   There should be a physical audit of all the fixed assets in order to know, which assets is to be disposed and which is to be replaced. The Asset disposal / transfer request form should be used in case of any transfer or disposal.

CONTD : 

CONTD The Company complex is spread in over 1200 acres and to travel from one department to other, the company employees uses petrol or diesel driven vehicles, instead of these new technology battery driven vehicles should be used. This will save the fuel cost as well as maintenance cost.   Every department should give a report of all the assets with the department to the personnel in the account department who looks after Fixed Asset Management after every six months. The reporting from each department should include information of the total assets available, the assets, which are disposed off, and the assets newly acquired.   The company has a surplus land available, which should be given to some organization on lease. This will produce an income for the company. Company should have an integrated GIS (geographic information system) to locate fixed assets.