As we know that Mahindra & Mahindra Co. Ltd. is a production unit. When ever production term comes then first thing comes in our mind that is inventory. Because inventory is base for any production unit so, when we control and manage the inventory properly then the company is benefited. (By reducing holding and carrying cost of inventory.) Thus after studying inventory Management the important activity which is done on quarterly basis in the account department is Budgetary Control in which operating Budget expenses is to be control in Mahaindra & Mahindra Co. Ltd. Nagpur Branch.
A Budget is a plan which relates to a definite period of time and which is expressed in quantitative terms.
It is thus a predetermined statement which
incorporates the policy of the management during a given period and serves as a standard for comparing the actual results. Thus a budget is a tool in the actual results. Thus a budget is tool in the hands of the management which serves as a guide to all the employees in achieving their goals objectives and targets.
A budget can help us a planning and coordination with all the employees, and departments, but the most important factor is that it is used for control purposes at all levels of management.
M & M s Farm Equipment Sector is the largest manufacturer of tractors in India with sustained market leadership of over 19 years.
It designs, develops,
manufactures and markets tractors as well as implements which are used in
conjunction with tractors. The tractor industry in Indian is segmented by horsepower into the lower segment of 25 HP, segment of 35 HP and higher segment of 45 HP and above. The Company s Farm Equipment Sector has a presence in all these segments across all states.
M & M Co. Ltd. Farm equipment sector has four plant locations in Rudrapur, Jaipur, Nagpur & Kandivalli. The project work is done for Nagpur branch. This branch is certified for ISO 9001, QS-9000, ISO-14001, M & M tractor have earned goodwill and trust of more than 8,00,000 customers and the Mahindra tractor has come to be recognized as a powerful symbol of productivity and performance.
The project requires two months time for the completion. The steps involve in collection of data from various sources like SAP, Monthly performance review meetings (MPRM) Reports, Annual Reports, Computerized Inventory Management system (CIMS).
Thus from this study of inventory management it is observed that by using various techniques such as ABC, EOQ, Reorder level etc. management minimize investment in inventory and meet a demand for the product by efficiently organizing the production and sales operations. The firm should minimize investment in inventory which involves costs i.e. ordering cost and carrying cost, so that smaller the inventory, the lower is the cost to the firm.
The study of budgetary control system help business to function with planning which is related to production, sales, stocks, requirement of labors, etc. The advantage of planning is that we can anticipate the problems before hand. Planning 2
through budgetary control is necessary at all levels of management in which there is the process of thinking which enables to provide new idea to the management
OBJECTIVES BEHIND THIS STUDY
The basic responsibility of the financial manager is to make sure the firm s cash flows are managed efficiently.
The objective of inventory management consists of two counterbalancing parts: (i) to minimize investments in inventory, and (ii) to meet a demand for the product by efficiently organizing the production and sales operations.
These two conflicting objectives of inventory management can also be expressed in terms of cost and benefit associated with inventory.
The firm should minimize investment in inventory implies that maintaining inventory involves costs, such that the smaller the inventory, the lower is the cost to the firm.
It should aim at a...