Receivables Management

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A STUDY ON RECEIVABLE MANAGEMENT WITH SPECIAL REFERECEN TO CALTEX LUBRICANTS INDIA LIMITED CHENNAI

BY J. ELANGOVAN REG NO : 35103077

A PROJECT REPORT SUBMITTED TO THE SCHOOL OF MANAGEMENT In the FACULTY OF ENGINEERING & TECHNOLOGY

In Partial fulfillment of the requirements For the award of the degree Of MASTER OF BUSINESS ADMINISTRATION

SRM SCHOOL OF MANAGEMENT SRM INSTITUTE OF SCIENCE & TECHNOLOGY DEEMED UNIVERSITY KATTANKULATHUR – 603 302 APRIL – 2005

i BONAFIDE CERTIFICATE

Certified that this Project report titled “RECEIVABLE MANAGEMENT” is the bonafide work of Mr. J. ELANGOVAN, who carried out the research under my supervision. Certified further, that to the best of my knowledge the work reported herein does not form part of any other project report of dissertation on the basis of which a degree or award was conferred on an earlier occasion on this or any other candidate.

Internal Guide T.P. NAGESH, M.Com.,BL., FICWA,

Head of the Department Dr.JAYASHREE SURESH

ii ABSTRACT Receivable represent amounts owed to the firm as a result of sale of goods or services in the ordinary course of business. These are claims of the firm against its customers and form part of its current assets. Receivables are also known as accounts receivables, trade receivables customers receivables or book debts. The receivables are carried for the customers. The period of credit and extent of receivables depends upon the credit policy followed by the firm. The purpose of maintaing or investing in receivables is to meet competition, and to increase the sales and profits. The study is based on the research design which includes descriptive type of research. This study is based on Secondary data. The data is collected from various files, management. These data have been collected from various files, management information reports and balance sheet of the company and other related books. In this study secondary data used are Balance sheet for the year 1999 - 2004 was used to project the financial analysis for Caltex Lubricants India Ltd., Sales Figures and other relevant data were collected from the companies book is and records of various departments. In order to analyses the problem of receivable management, a tool of financial management, Ratio Analysis and chi-square were used to arrive the conclusion. The various Financial tools were used in order to process and to assive at a conclusion. iii The tools used is Ratio analysis for the purpose of assiving conclusion.

Ratio Analysis Ratios are relationships expressed in mathematical terms betweeen figures which are connected with each other in some manner. Obiously, no purpose will be served by comparing two sets of figures which are not at all connected with each other. Moreover, absolute figures are also unfit for comparison. This study is also having certain limitations too. The study is based only on secondary data collected from balance sheet and P/L account of company. The whole study is basd on observations in the past. Based upon the findings, the sudy recommendated company to go far factering services for all credit line customers as it will improve the cash flow of company and reduces risk. The company should offter discounts to customers in order to speed up the credit collection process. The study also recommends company to remind the customer periodically before due date by sending reminder letters / personal visit by marketing executives, the study also recommends marketing dept of company to increase cash sales by offering quantity discounts. The study will help the company’s growth by providing better funds position.

iv ACKNOWLEDGEMENT

I thank Mr.R. VENKATARAMANI, Principal S.R.M. Engineering College for providing facility to undertake this project. I record my thanks and gratitude to our Head of the Department Dr.JAYASHREE SURESH for her valuable suggestions. At the outset I would like to acknowledge with due regards and respects to my guide...
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