INDEX

EXECUTIVE SUMMARY
There is a vast opportunity for investment in the online healthcare services in both urban and
rural India. Live World Health Tech Pvt. Ltd. has developed a unique cloud-based healthcare
system “WHR - World Health Record” to aid patients and medical fraternities to integrate on a
singular platform to primarily enable secure sharing of DMR (Digital Medical Records) and
subsequently solve complete healthcare issues in the process.

Digital Medical Record:

o A major problem today many services in India are available online on the phone from
secure banking to mobile records.

o Unfortunately, medical reports still follow an antiquated system.

o They are filed away in cabinets in healthcare centers, partially handwritten and partially
typed, difficult to access by the patient when needed most.

o These bulky paper records need to be stored carefully by patients and lugged around
when needed often requiring new tests if misplaced or additional costs to obtain new
records to replace lost or damaged ones.

o This makes it highly inefficient during emergencies, where time is of the essence.

India’s burgeoning population and increased life expectancy have also led to a high domestic
demand for quality healthcare products, services, and alternative treatments, which are difficult
to locate and compare as they do not exist on a singular platform. Visits to these facilities in
person become mandatory to make informed choices, costing both time and money. The rapidly
growing demand and the legal prohibition of promotion of services in the healthcare sector offers
a huge potential for online health services to reach a larger consumer base with substantially
lesser operational costs.

WHR is developed as a one-stop solution for healthcare needs upon analyzing the above
problems in the Indian healthcare sector.

In this report, I made an effort to know the financial position of World Health Record.
(Liveworld Health Tech. Pvt. Ltd.) My topic is “Cash Flow Management” which stands for the
process of revenue generation to the application of such resurrected revenue. In simpler term, it
is a process which focuses on pre and post application of management which deals in monetary
terms.
 INTRODUCTION

What It Is

An operating expense is a day-to-day expense incurred in the normal course of business. These
expenses appear on the income statement.

How It Works

Operating expenses are costs associated with running a business's core operations on a
daily basis. Common examples are cost of goods sold (COGS) and labor costs.

Operating expense typically excludes interest expense, nonrecurring items (such as accounting
adjustments, legal judgments, or one-time transactions), and other income statement items not
directly related to a company's core business operations.

Why It Matters

Operating expense is a key component in the calculation for operating income, and operating
income is a crucial component of many financial measures. The lower a company's operating
expenses are, the more profitable it generally is.

Several things can affect operating expenses such as pricing strategy, prices for raw materials, or
labor costs, but because these items directly relate to the day-to-day decisions managers make,
financial measures based on operating expenses are also measures of managerial flexibility and
competency, particularly during tough economic times.

It is also important to note that some industries have higher operating expenses than others. This
is why comparing operating expenses or income is generally most meaningful among companies
within the same industry, and the definition of "high" or "low" expenses should be made within
this context
The Basics of Operating Expenses

Although different businesses have different costs associated with them, the main operating
expenses of most businesses include:

Rent:
Under many lease agreements, you'll be expected to provide the first month's rent plus a
security deposit. Many leasers also require the last month's rent

Equipment:

Equipment costs vary from one business to another. At a minimum, most businesses need
office equipment, signage, and security systems. To determine your costs, list all the
equipment you must have to efficiently operate your business.

Fixtures:

This broad category includes partitions, paneling, signage, storage cabinets, lighting,
checkout counters, and all shelves, table stands, wall systems, showcases, and related
hardware for product display. The cost of fixtures depends on your business location, the
size and condition of your facility, the type of business you're in, what kind of image you
want it to project, and whether you're purchasing new or used fixtures.

Inventory:

Like equipment, inventory requirements vary from business to business. Some

businesses, such as retail stores, are inventory-intensive, whereas others, such as personal
shopping services, don't require any inventory at all except office supplies.

Leasehold improvements:

These non-removable installations, either original or the result of remodeling, include

carpeting and other floorings, insulation, electrical wiring and plumbing, bathrooms,
lighting, wall partitions, windows, ceiling tiles, sprinkler systems, security systems, some
elements of interior design, and sometimes heating and/or air-conditioning systems.
Because the cost of improvements can vary tremendously, get several estimates from
reputable contractors.
Licenses and tax deposits:

Most cities and counties require business operators to obtain various licenses or permits
to show compliance with local regulations. Licensing costs vary from business to
business, depending on the requirements of your particular location.

Marketing budgets:

Most companies determine their first year's advertising budget as a percentage of

projected gross sales, typically two to five percent.

Professional services:

Generally, this refers to your lawyer and accountant. Their fees will range according to
their expertise, and the location and size of their practices.

Insurance:

A word of caution when estimating these costs: If there's ever a time to be conservative,
it's now. Err on the high side when you project expenses, and on the low side when you
project revenue. And don't forget to add a "rainy day" or contingency fund to cover the
costs of unforeseen expenses-somewhere around five percent of your budget is a typical
amount to set aside. This financial cushion will help you-and your investors-avoid panic
in case you're faced with an expense you hadn't budgeted for.
The Objective of the Project

o To understand the concept of operating expenses and its application with respect to
Health Record.
o To analyze day to day expenses of World Health Record
o To evaluate the cash flow management techniques with respect to World Health
Record.
o To understand the current position of World Health Record and the nature of the cash
flow management with respect to provided data.
o To address the problems, if any, in ascertainment of various cash flow practices with
respect to World Health Record.
o To analyze the Cash flow strength and weakness in the organization.

Selection of the Topic for the Project Report:

o Study of this report is useful in understanding the various techniques of cash flow
management in financial sector
o Report overviews the efforts put in by the organization in improvement of the
management.
o Report helps us understand the various techniques in financial sectors which are
applicable in the sector of finance.

Limitation of the Study:

o Scope of study is limited by the analytical data provided by the organization.

o Study undertakes only available sectors in World Health Record which may or may
not be applicable in every organization.
o Time constraint is of 365 days only.
o All the financial information is not disclosed for the sake of study.
 Profile of the Company

Company Introduction and Details

Figure 1WHR Logo

WHR provide cloud-based centralized healthcare information and service. This is the online
platform where we provide patients with our tied up hospitals/Doctors and Diagnostic centers.
We are the intermediary between patient and doctors. This service results in having mutual
understanding and clarity between patient and doctor. This software is free to use for patients and
hospitals.

It will help doctors/hospitals to get a large number of patients and to become a globalized one
due to our online marketing. This is the Win-Win platform.

It's Free. You can check our App Links:

User App:

https://play.google.com/store/apps/details?id=com.etech.whruser&hl=en

Doctor App:

https://play.google.com/store/apps/details?id=doctor.whr.com.whrdoctor&hl=en

DiagnosisApp:https://play.google.com/store/apps/details?id=activity.whr.com.whrpathologyproj
ect&hl=en

Company Web Site:

https://www.whrhealth.com
Founder

 NAME: Mr. Shivkumar Borade. (Marketing Director)

Mr. Borade is armed with over 10+ years of experience. He is a brainchild, which was a result of
understanding the tremendous potential of business opportunities in the Indian healthcare sector
and the emergence of new health care needs.

He has worked with leading brands across industries such as ICICI Prudential and Sujivan Multi-
trade.

He has served as chairman of SMIC Healthcare Pvt. for over 3 years. Functionally he has a
considerable exposure across various functions viz. Finance, HR, Marketing and IT.

He has also served as a faculty member to in-house training programs of various organizations.

He awarded by Lokmat Media Pvt. Ltd. ICONS OF SOLAPUR 2017.

 NAME: Dr. Amar Kokane. (Medical Director)

Dr. Kokane provides the company with much needed medical expertise.

He has an expert command on the healthcare insights.

He has done his MBBS and more than 10 years’ experience in various areas of medicine.

Serving as Medical officer and Medical director as well.

General Company Description

LiveWorld Health Tech Pvt. Ltd. was incorporated on 10th May 2016 with a commitment to
offer reliable and quality healthcare services to patients and medical fraternity.

As a consumer centric company, customer satisfaction remains the core of the business.

MISSION:

To become the market leader providing electronic health records and other healthcare services
via innovative proprietary smart phone applications.

VISION:

To create a unique health ID of all individuals so that they may efficiently access, save and share
their health records.

The Target Market and Competition:

Besides, Indian medical service consumers have become more conscious towards their
healthcare upkeep and increasingly comfortable with the online medium. Keeping this in mind.

B2C Market:

An increasing demand for online services points to target marketing efforts to those patients
comfortable with online and smart phone platforms.

Patients already registered by health service providers

Patients who search for clinics, hospitals, diagnostic centers, chemists; search for second
opinion, alternatives, treatments, diagnosis and accept,

Those who express gratitude while paying for services, commit to recommended recall, and refer
their friends.

B2B Market:

WHR has found an excellent response from the Pune Medical Fraternity.

The Federation of Chemists of Pune has agreed to support WHR, as have a large number of
doctors and medical providers. Doctors have expressed a huge amount of interest as we going to
be providing them marketing support to build their brand.
The WHR Leadership and Management Team

Two directors with an aggregate of more than 20 years in the healthcare industry, medicine, law,
management and operations.

A technically strong software team with experience in building and maintaining complex
inventory and medical management systems.

An expanding board of veteran advisors made up of medical doctors who have healthcare
business experience.

A combination of in-house and commissioned experienced sales management team, which has
commenced work after the pilot project in Pune.

Service Description

WHR utilizes an innovative cloud-based smart phone application (Android & IOS) model which
integrates all departments of healthcare sector for various individual healthcare requirements. It
is foreseen to have a high repeat business in segments like clinics/hospitals, diagnostic canters,
chemists–as it is used in maintaining electronic medical records and the transmission of
information. The main emphasis is on DIGITAL INDIA in the healthcare sector. Many entities
have contributed in this concept by providing limited services only to smart phone users and the
urban India. Considering this scenario WHR will also take the initiative to provide services to
non-smart phone users, ensuring availability of both online & offline services.

Service implementation Plan:

B2B customers include doctors, chemists, pathologists, hospitals and also insurance companies.
Initially the healthcare service providers shall be registered and verified by our marketing
representatives into the system. Our B2C users i.e. patients will be initially registered by these
service providers by creating a UNIQUE PATIENT ID and advised to download mobile
application for further use. This would allow for all segments to be interlinked and integrated.
Digital Record Keeping

An electronic health record is a digital version of a patient’s paper chart. DRKs are real-time,
patient-centered records that make information available instantly and securely to authorized
users.

While DRK does contain the medical and treatment histories of patients, a DRK system is built
to go beyond standard clinical data collected in a provider’s office and can be inclusive of a
broader view of a patient’s care.

DRKs can:

Contain a patient’s medical history, diagnoses, medications, treatment plans, immunization

dates, allergies, radiology images, and laboratory and test results

Allow access to evidence-based tools that providers can use to make decisions about a patient’s
care

One of the key features of DRK is that health information can be created and managed by
authorized providers in a digital format capable of being shared with other providers across more
than one health care organization.

DRKs are built to share information with other health care providers and organizations – such as
laboratories, specialists, medical imaging facilities, pharmacies, emergency facilities, and school
and workplace clinics.

So they contain information from all clinicians involved in a patient’s care, the major difference
here with the existing DRK system is – the consent of the patient is mandatory to share the health
records.
WHR User Interface

A. USER/PATIENT INTERFACE:
Once a User/ Patient registers, He/she can access to the following segments all under one roof:

Users/Patients will be able to:

o View various options and decide on medical service providers based upon proximity.
They can decide whom to consult/ diagnose/buy medicine from nearby pharmacies, as a list of
doctors, clinics, hospitals, diagnostics centers and chemist will be provided.

o They can book online appointments, call or consult online as well. They will be able to
view consultation fee, treatment fee, hospital charges, diagnosis fee which are available at a
discounted price for service users.

o USERS can upload his full medical history for free and can have access to it at any
time.
 o A list of various nearby ambulance contacts & services will also be provided. During
emergency patients need to press emergency option where in simultaneously messages are sent
to their relatives, nearby doctors and the WHR support team.

o Users can view charge sheets and compare various hospitals with respect to the
amenities provided by respective hospitals.

o Also in near future Health Insurance info will be accessible via the app to users. They
will be able to check their policy coverage under various hospitals and can also purchase one if
they don’t have.

o Users can create unique ID of his/her family members and can also store their medical
records.

o Health Awareness and Information Access:

As an initiative towards health awareness will provide various types of information to

users:

o First Aid is in the form of text, audio & video which will help users learn about
primary care and how to administer first aid correctly in various situations
o Alternative treatments for various diseases which have effective results in the
respective branch of medicine and updates on new technology
o Life style – exercise, yoga, diet, etc. Web-based disease management programs
are an important part of the e-health revolution, and are designed to alter the
delivery of care through the use of technology to monitor patients daily to
determine their health status, remind them to take their medications, and handle
problems before they become more serious.’ Our IT team sends email newsletter,
trackers and reminders to continually engage our members.

User can avail SUPPORT for a hassle free service. Better user interface, filters, descriptions and
assisting users into decision-making will result in higher customer satisfaction and conversion
rates.

WHR will offer maximum value for money, be it in terms of products or services. The entire
process revolves around creating an efficient, seamless and convenient experience for users. This
saves the patients a great deal of time and money.
A CRM team shall be used to update and maintain the database and take product or service
feedback. The WHR support team will remain accessible to the user via the app. This will result
in a positive impact high customer satisfaction and thus help in maintaining an active customer
database.

B. DOCTOR/CLINIC/HOSPITAL INTERFACE:

The implementation of online services will help healthcare providers work more efficiently
especially those using back-dated paper-based systems. The benefits are that hospitals and
doctors are able to view a patient’s full medical history and give the correct diagnosis. Doctors
can also use this technology for maintaining patient records, act as an appointment diary, follow
up patients and treatments, patients’ routine check-ups, etc. Doctor shall register patients.
Doctors shall receive emergency Intimation message in their particular locality.

Doctors to give the patient their diagnosis in an electronic prescription, which can be viewed by
user, Chemist, pathologist and other doctors when patient is referred and they act accordingly.

Also the same doctor can simultaneously consult and write without any barrier, it has also
avoided paper work to a great extent and is an instrument in cost cutting.
C. CHEMIST/DIAGNOSTIC CENTRE INTERFACE:

The application offers operation and inventory management system to optimize inventory levels
of drugs and methods for optimizing the ordering process of care-related products and
pharmaceuticals.

Subsequently, a stock replenishment system is developed where the system keeps a daily record
of stock-levels and automatically orders if allowed then new stock, shipped and delivered when
required.
WHR Work Flow
SWOT Analysis

The following SWOT analysis provides detailed insights into the opportunities, risks and
strengths of this business:

STRENGTHS:

o A good way to start is to merge all the segments of healthcare sector and online
services i.e. a Centralized system which involves transactions and the exchange of information
among clinics, hospitals, chemist, pathologists, insurance agencies, state and federal regulators,
and doctors’ offices where patients—the end users —are directly involved.

o Creation of unique Patient ID, which can be accessed by doctors/ chemist/ pathologist/
hospitals with the approval of the patient to view his records.
 o A customized digital prescription pad (future implementation) will be provided to
doctor, in order to save paper and time to upload the image of case paper and prescription. Hence
making it easy and user friendly.

o Chemist and pathologist shall view the prescription online by entering the patient ID to
perform their respective roles i.e. chemist can provide medicine to patient and feed the details of
medicines taken by patient, which can be viewed by doctor when the patient approaches for
follow up. Pathologist can take the sample for test advised and can send the digitally signed
reports online which can be viewed by patient and Doctor. Here time of patient is saved as it is
not required to collect the reports in person and doctor can also consult the patient via telephone.

o Making accessible to records & information online not only benefits doctors and their
patients, it could also improve relationships between hospitals, clinics, suppliers and customers.
It could also open new doors whereby doctors could monitor patient’s medication, even if patient
denies the fact of incompletion of medicine course. The possibilities are endless.

o It saves time and transportation of user. Because there is no need to go anywhere

physically, he can acquire most of the information and enquire and also book appointment,
collect lab reports and buy medicine online. The applications can be used by all anywhere any
time as there is no time constraints.

o Helps users to compare price and treatment effectively and efficiently. They shall have
an advantage of effective/ discounted prices of treatment. Things can be automated in a well
implemented manner.

o Shall work on both online and offline mode.

WEAKNESS:

o As online has not been fully taken advantage of maximized to its full potential due to
people not being able to fully let go of tradition and embrace new technology. The key to the
success lies primarily in the full participation of consumers and healthcare providers.

o Concerns about misuse of data.

 o In developing areas where internet (as such very less) is not accessible will have no or
little exposure to the applications?

o There is no direct interaction (can be on demand) between the company and the patient.
Therefore, the scope of convincing the patient does not exist. Many times patient prefer to reach
personally to the doctor rather than going through internet.

OPPORTUNITY:

o The presence of very few players in online healthcare space has offered a great
platform to grow especially when the demand is huge for quality services. Hence, there is no bar
to growth trajectory in the healthcare e-tail space.

o The rapid adoption of digital technology and evolving shopping behavior are
transforming the e-commerce space into an essential element of Omni channel success. With the
growing average expectancy, where 26% of Indian specialist physicians cater to a large 78% of
the rural population, the vast geographical expanse certainly lacks an effective delivery
mechanism.

o All the segments of healthcare can be dealt globally as no specific boundary is required.
It enables the company to expand to global level.

o With the proper use and operations, traditional paper-based systems will be eliminated
in the mere future.

THREATS:

There are few companies, who provide healthcare service through online services, like

o Practo Technologies Private Limited: Practo develops medical practice management

software that offers patient appointment scheduling, record management and billing

services.

o Lybrate: Lybrate is an online and mobile-based platform that allows users to book for
doctor appointment in India.

o Helping Doc: Helping Doc is an online platform that lists medical professionals and
 enables patients to book for doctor appointments in India.

o Ziffi: Ziffi.com is an online search and appointment booking service for salons and

spas, health and wellness.

o Praxify: Praxify provides cloud-based physician practice management solutions.

o Kare4U: Kare4u Healthcare Solutions focuses on technology services in healthcare

industry.

o Smart Square Technologies: Provides a platform that collates data from multiple data

sources in a hospital and makes easy to manage.

o Meditag: Meditag is a software development firm that is into application

development, systems integration and professional services.

o Doc Engage: Doc Engage is a comprehensive Healthcare Platform that empowers care

providers to manage care life cycle end to end through a powerful set of tools.

o Jeevom: Jeevom.com is a healthcare platform for all preventive, curative and wellness
needs.

Financial Plans and Projections

Financing and Current business status and traction:

WHR (Live World Health Tech Pvt. Ltd.) has been self-funded since it began work on the
product 2 years ago. The company has spent more than US$ 150,000 till date in product
development and asset to embark on a 3-month pilot project in Jan 2018 to document traction
and test the software from various user interfaces.

The company will subsequently seek funding of approximately $15 million, with multiple
investors already interested. The funding will enable the completion of the product for the
desired geographical areas.
Many Pune-based hospitals, clinics, doctors and the chemist association of Pune are already
supporting & working with WHR. Funding is required to scale services to a further 10 Tier 1
cities and commence work.

The company is seeking to raise funding as we have completed our pilot project & know we can
scale up implementation of WHR services after years 2 of product development & operation.
Since the last 2 Years the company has been self-funded via personal financing and unsecured
loans.

Break-even Analysis:

The break-even analysis demonstrates that WHR will have a sales level running comfortably
above break-even starting in year two. Depending on the revenue model used - either
subscription or advertising royalties or both - average revenue could vary significantly, but the
table shows a fair estimate given our revenue projections.

The business will have limited fixed costs – major chunks being devoted to operations and
salaries, but the business is expected to turn cash positive by the end of the first year, even on
conservative estimates. Because WHR a cloud based software implemented as a smartphone

application, it is optimized for minimal hardware requirements; it can be easily distributed and
integrated into both android and apple phones with advantages of economies of scale. As volume
increases, average variable costs will significantly decrease.

Important Assumptions:

o The financial plan depends on important assumptions, most of which are shown in the
following table.

The key underlying assumptions are:

o WHR assumes a medium paced economy, without major recession.

o WHR assumes of course that there are no unforeseen changes in technology to make
products immediately obsolete.

Profit potential and durability:

WHR is expected to be net income positive beginning in its second full year of operations.
Profitability is expected to grow rapidly following year two, once the business is able to leverage
the investment from year two. WHR has the potential to be an enduring standalone business,
with the opportunity to expand its database via offline operations and its other collaborative and
awareness offerings in the healthcare sector for long-term growth.
 Theoretical aspect of the Research Topic

Introduction to Operating Expenses

The primary types of operating expenses include payments that are related to compensation,
sales and marketing, office supplies and non-facility fees. ... Some companies also include
the costs of goods sold (COGS) as an operating expense.

Operating Expenses
Operating expenses or OPEX are expenditures that are not directly tied to the production of
goods or services. Typically, selling, general, and administrative expenses are included under
operating expenses as a separate line item. SG&A expenses are expenditures that are not directly
tied to a product such as overhead costs. Examples of operating expenses include:

o Rent
o Utilities
o Office supplies
o Legal costs
o Sales and marketing
o Payroll
o Insurance costs

A company's management must keep operating expenses under control without adversely
affecting the company's earnings and ability to compete with its competitors.
Businesses incur several different costs that are independent of the level of sales they produce.
For example, a coffee shop must continue to pay rent, utilities, and employee salaries on its
facilities even if customers are not buying any of its beverages. Operating expenses are the
recurring costs that are not directly related to actual goods.

Cost of Goods Sold

Cost of goods sold is the direct costs tied to the production of a company's goods and
services. COGS excludes indirect expenses such as distribution costs and sales force costs.

COGS represents the business expenses that are directly incurred because a transaction has taken
place. When the coffee shop sells a coffee, this expense account captures the price of the cup, the
coffee sleeve, the water, the processed beans, etc.
Examples of COGS include:

o Labor directly tied to production

o Depreciation of the manufacturing plant
o Utilities of the facilities tied to production
o Direct materials needed for the production of goods and services
o Taxes on the production facilities

In the retail industry, cost of goods sold could be the inventory and merchandise purchased from
the supplier or manufacturer.

Definition:
Operating costs are expenses associated with the maintenance and administration of a business
on a day-to-day basis. The operating cost is a component of operating income and is usually
reflected on a company’s income statement. While operating costs generally do not
include capital outlays, they can include many components of operating a business including:

o Accounting and legal fees

o Bank charges
o Sales and marketing costs
o Travel expenses
o Entertainment costs
o Non-capitalized research and development expenses
o Office supply costs
o Rent
o Repair and maintenance costs
o Utility expenses
o Salary and wage expenses

The formula for operating cost

Operating Cost = Cost of Goods Sold + Operating Expenses

 Advantages of Operating Expenses

o Provides detailed information on revenues: The income statement provides detailed data on
revenues. Besides the normal costs such as the cost of goods sold (COGS), employee expenses,
operational expenses, it also accounts for additional costs like taxes applicable. Similarly, on the
revenue front, it accounts not only for revenues earned from sales but also factors in for revenues
gained from nonoperational components like interest accrued by different investments. Hence,
the income statement is an ideal source for complete revenue information.

o Database for Investor Analysis: It is an important document for investors who need detailed
information before investing into any company. It provides all the data from sales to profits,
operational efficiency to other non-operational aspects. All this cumulatively helps investors get
a clear picture of how the business is and expected to be. Thus, it is a single source to judge the
condition of a company.

o Other benefits: The income statement shows the profitability of the company over a period of
time. The company can determine the major revenues it has earned. Secondly, it is significant
because it is based on the matching principal and shows the expense incurred by a company to
earn the revenues. From an investment perspective, shareholders of a company are interested in
the net income because the dividends are paid out of the total income. Moreover, income
statement also helps the companies analyze their expenses and take into account the major
streams of operating revenues of the company.

Disadvantages of Operating Expenses:

o Misrepresentation of data: The income statement includes not only current revenues gained from
sales but also the money due from accounts receivable which the business has not paid yet, just
as it includes liabilities as expenses that have not actually been paid yet. Also, the large one-time
expenses or revenues can drive the income sharply up or down from what it actually should be.
This leads to misrepresentation of the success of the company

o Other factors: The income statement helps in gauging the earnings per share and other past
financial data, but it does not provide with data on the expected future growth. It does not give
any indication on how the revenue generation happens. A business may be underpaying
employees and overcharging customers to create its profits, practices that will eventually cause
business problems but show as positives on the financial document. Any investor looking into
the income statement has to have these additional factors also in mind before taking any financial
decision. One needs to remember that the income statement is considered as a fiction because it
is based on accrual accounting and it does not provide cash transactions. Free cash cannot be
calculated through income statement
Significance of the operating expenses

o The operating ratio is used to measure the operational efficiency of the management.
o It shows whether or not the cost component in the sales figure is within the normal range.
o A low operating ratio means a high net profit ratio (i.e., more operating profit) and vice
versa.

The ratio should be compared:

with the company’s past years ratio,

with the ratio of other companies in the same industry. An increase in the ratio should be
investigated and brought to attention of management as soon as possible. The operating ratio
varies from industry to industry.
 Reasearch methodology

 Salaries and wages.

 Utility expenses.
 Cost of goods sold.
 Administration expenses.
 Finance costs.
 Depreciation.
 Impairment losses.
Calculate on the Basis of two year statement while previous year being standard year and the
next year being becomparative one