A STUDY ON

FINANCIAL STATEMENT ANALYSIS

With reference to VAMSADHARA PAPER MILL LTD., SRIKAKULAM

A Project report submitted to Andhra University

In partial fulfillment for the Award of degree of

MASTER OF COMMERCE
Submitted By

VADDI NARESHKUMAR, M.Com Final

(Regd No: 113200206050)

Under the esteemed guidance of

Prof. P. VISWANADHAM Ph.D.,

Department Of Commerce and Management Studies

Andhra University
Visakhapatnam
(2013 15)

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 DECLARATION

I hear by declare that this project report entitled A STUDY ON

FINANCIAL STATEMENT ANALYSIS, With Reference To
VAMSADHARA PAPER MILL LTD SRIKAKULAM has been prepared by
me under the esteemed guidance of Prof. P. VISWANADHAM. Andhra
University Visakhapatnam in partial fulfillment of the award of Master of
commerce.

VADDI NARESHKUMAR
(M.COM Final)

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 CERTIFICATE

This is to certify that the project entitled a study on FINANCIAL

STATEMENT ANALYSIS is the bonafide record for work done by
Mr. VADDI NARESHKUMAR during the period 2013-15 in partial
fulfillment of the requirement for the award of the degree of MASTER OF
COMMERCE in DCMS, ANDHRA UNEVERSITY, VISAKHAPATNAM,
under my guidance and supervision.

Prof. P. VISWANADHAM Ph.D.,

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 ACKNOWLEDGEMENT

I wish to take great Pleasure in recording my profound gratitude and

sincere thanks to Prof. P. VISWANADHAM Ph.D., for his inspiring
guidance and keen interest and critical evaluation of the work for the successful
completion of the project work .

I would like to thank Prof. M. MADHUSUDHANA RAO Ph.D.

Head of the Department, Department of Commerce and Management Studies ,
Andhra University, Visakhapatanam, For his continuous support.

I wish to express our gratitude to VAMSADHARA PAPER MILL

Limited, management for giving us an opportunity to be a part of their esteem
organization and enhance my knowledge by granting permission to do our
summer training project under their guidance.

Firstly, I will take this opportunity to express my deep sense of gratitude

and sincere thanks to Mr. R.KOUSHIK, Executive Director of the
Organization who gave me a wonderful opportunity to conduct this research
project in their esteemed organization. I am grateful to Mr. D.V.S.N.RAVI
KUMAR, FINANCE MANAGER in VAMSADHARA, my guide for their valuable
guidance and cooperation during the course of the project. They provided me
with their assistance and support whenever needed that has been instrumental in
completion of this project. The learning during the project was immense &
valuable.

VADDI NARESHKUMAR

(M.COM Final)

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 CONTENTS

PG.NO

Chapter-I: 01-05

INTRODUCTION
NEED OF THE STUDY
OBJECTIVES OF THE STUDY
METHODOLOGY OF THE STUDY
LIMITATIONS OF THE STUDY

Chapter-II: 06-13

INDUSTRY PROFILE

Chapter-III: 07-28

COMPANY PROFILE

Chapter-IV: 29-41

CONCEPTUAL FRAME WORK ON

COMPARATIVE STATEMENT ANALYSIS &

COMMON SIZE STATEMENT ANALYSIS

Chapter-V: 42-95

Data analysis and interpretation

Chapter-VI: 96-98

FINDINGS

SUGGESTIONS

CONCLUSION

BIBLIOGRAPHY: 99

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 CHAPTER -1

INTRODUCTION
NEED OF THE STUDY
OBJECTIVES OF THE STUDY
METHODOLOGY
LIMITATIONS

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 INTRODUCTION
Financial statement analysis is the process of identifying the financial strengths and
weaknesses of the firm by properly establishing relationships between the items of the
balance sheet and the profit and loss account. Financial analysis can be undertaken by
management of the firm or by parties outside the firm, viz. owners, creditors, investors and
others.

A simple method of tracing periodic changes in the financial performance of a company is to

prepare comparative statements. Comparative financial statement will contain items at
least of two periods; changes- increases and decreases in income statement and balance
sheet over period can be shown in two ways:

1) Aggregate changes and 2) proportional changes.

Drawing special columns for aggregate amount or percentage, or both, of increase and
decreases, can indicate aggregate changes. Recording percentage calculated in relation to a
common base in special column, on the other hand shows relative, or proportional change.

An investigation of the comparative financial statements helps to highlight the significant

facts and points out the items which need further analysis. The published balance sheets
and presented in two-year comparative form. Some of the companies also report to
shareholders condensed comparative statements converting an extended period of ears.
3From analytical point of view, such statements are quite useful to investors.