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INTRODUCTION
CAPITAL BUDGETING:
An efficient allocation of capital is the most important finance function in
modern times. It involves decisions to commit firm’s funds to long-term
assets. Such decisions are tend to determine the value of company/firm by
influencing its growth, profitability & risk.
Investment decisions are generally known as capital budgeting or
capital expenditure decisions. It is clever decisions to invest current in long
term assets expecting long-term benefits firm’s investment decisions would
generally include expansion, acquisition, modernization and replacement of
long-term assets.
Such decisions can be investment decisions, financing decisions or operating
decisions. Investment decisions deal with investment of organization’s resources in
Long tern (fixed) Assets and / or Short term (Current) Assets. Decisions pertaining to
investment in Short term Assets fall under “Working Capital Management”.
Decisions pertaining to investment in Long term Assets are classified as “Capital
Budgeting” decisions.
Capital budgeting decisions are related to allocation of investible funds to
different long-term assets. They have long-term implications and affect the future
growth and profitability of the firm.
In evaluating such investment proposals, it is important to carefully
consider the expected benefits of investment against the expenses associated
with it.
Organizations are frequently faced with Capital Budgeting decisions.
Any decision that requires the use of resources is a capital budgeting
decisions. Capital budgeting is more or less a continuous process in any
growing concern.
METHODOLOGY:
Secondary sources: The secondary data have been collected through the various
books, magazines, broachers & websites.
CHAPTER 2
INDUSTRY PROFILE:
INTRODUCTION OF CEMENT:
The basic need of human being is food clothing and shelter love and
affection /possession is on never ending process for a human being.
As the time passes on human beings their wants and wishes also
changed from ancient times to modern times and among them the living
pattern and construction works also have been changed from temporary
construction of house to permanent construction and the basic material used
in construction is “Cement”.
Cement the word derived from a Latin word ‘CEMENTTUM’ means
stone chipping such as we used in roman.
Cement the word as per oxford, it is commonly used is any substance
applied for soft stocking things. But cement means is most vital and
important material for modern constructions. It is a material which sets and
hardness when mixed with water. Cement is basically used in construction as
a building agent. In ancient times clay bricks and stones have been used for
construction works.
The Romans were using a binding or a cementing material that would
harden and water. The first systematic effort was made by “SMEATON” who
undertook the execution of a new light house in 1756. He observed that
Production obtained by during lime stone was the best cementing material
for work under water.
The construction in lost centuries was with Lime that was the main
equipment used for construction work. The ancient constructions like
Tajmahal, Qutubminar, Mysore Palace, Red fort, Charminar etc., the evidence
of lime construction.
INDUSTRY SCENARIO:
TOTAL PRODUCTION:
The cement industry comprises of 125 large cement plants with an installed
capacity of 148.28 million tons and more than 300 mini cement plants with an
estimated capacity of 11.10 million tons per annum. The Cement Corporation of
India, which is a Central Public Sector Undertaking, has 10 units. There are 10 large
cement plants owned by various state Governments. The total installed capacity in the
country as a whole is 159.38 million tons.
Actual cement production in 2017-18 was 502 million tons as against a
production of 283.50 million tons in 2016-17. Major players in cement
production are Ambuja cement, Aditya cement, J K Cement and L & T
cement.
FUTURE FOCUS:
The report, “Indian Cement Industry Outlook 2020”, portrays the current
scenario and the forecasts for production, consumption, capacity utilization,
and installed capacity for 2020. A detailed regional analysis has been
provided in the study which shows that the Southern region has the
maximum demand, which is expected to increase in near future. Besides this,
share of major players in the production and installed capacity has been
provided in the report. The report also covers various factors driving the
industry.
GOVERNMENT POLICIES:
Cement was one of the government controlled industries earlier.
Partial decontrol was introduced in 1982 and with 1991 policy
reforms, all controls were withdrawn. Today, Government allows
100% FDI in cement industry. However, due to environment concerns,
the cement industry has to comply to stringent environment rules.
1. UltraTech Cement
UltraTech Cement is India’s largest and amongst the World’s top cements
manufacturers. The company has the presence in five countries. The total
operation includes 11 integrated plants, one white cement plant, one
clinkerisation plant, 15 grinding units, two rail and three coastal terminals,
and 101 ready mix concrete (RMC) plants. Additionally, the company is the
largest clinker exporter in India.
Establishment: 1987
Headquarter: Mumbai
2. Shree Cements
Shree Cements is a trusted brand in India, mainly in the northern and eastern
part of the country. Currently, the company has the manufacturing
operations over North and Eastern India across six states. Additionally, the
company is popular as one of the most efficient and environment-friendly
companies in the global cement industry.
Establishment: 1970
Headquarter: Bangur Nagar, Ajmer, Rajasthan
3. Ambuja Cements
Ambuja Cements is one of the most popular brands in western India. The
company was formerly known as Gujarat Ambuja Cement Limited. Basically,
it is a major cement producing company in India. Now, the company is a part
of the global conglomerate Lafarge Holcim. Currently, Ambuja Cement has a
cement capacity of 29.65 million tons with five integrated cement
manufacturing plants and eight cement grinding units across the country.
Establishment: 1983
Headquarter: Mumbai
4. ACC
ACC Limited is India’s one of the largest manufacturers of cement and ready-
mixed concrete. The company has 17 modern cement factories and more than
50 ready mixed concrete plants. ACC has a unique track record of innovative
research, product development, and specialized consultancy services.
Basically, ACC is the first cement company in the country to start Bulk
Cement, especially for large consumers.
Establishment: 1936
Headquarter: Mumbai, Maharashtra
5. Binani Cement
Binani Cement is the flagship company of the Braj Binani Group. Basically,
the company produces ‘Ordinary Portland Cement’ (OPC) and ‘Pozzolana
Portland Cement’ (PPC) under the Binani brand. Additionally, the
company enjoys premium status amongst major Indian cement brands with a
significant market share in northern and western India.
Establishment: 1996
Headquarter: Mumbai
6. Ramco Cements – Supergrade
Ramco Cements was founded as Madras Cement. Company’s’ flagship
product Ramco Grade is the most trusted cement brand in South India. The
company has 5 cement plants, 4 Grinding Plants, 1 Packing Plants, 1 Ready
Mix Concrete Plant and 1Dry Mortar Plant spread across the country.
In addition to that, the company is the fifth largest cement producer in the
country. Company’s product range includes Portland cement, Ready Mix
Concrete, and Dry Mortar products.
Establishment: 1957
Headquarters: Chennai
7. OCL India
Sjt. Jaidayalji Dalmia, an industrialist of the farsighted vision set up a cement
plant at the request of the government of Odisha to manufacture super grade
cement for use in the construction of the Hirakud dam. The company is
popular for producing one of the most prestigious brands “Konark”.
Establishment: 1950
Headquarter: Rajgangpur (Odisha)
8. Birla Corp
Birla Corporation Limited is an Indian-based flagship company of the M P
Birla group of companies. The Cement Division of Birla Corporation Limited
has seven plants. All the cement plants are ISO 9001:2000 Certificate, covering
the entire range of production and marketing. Some of the most popular
cement brands are Samrat, Khajuraho, Chetak, and Birla Premium cement.
Establishment: 1919
Headquarter: Kolkata, West Bengal
9. J. K. Cement
J. K. Cement company is extensively in the manufacturing and distribution of
cement as well as cement based products. The company was founded by Lala
Kamlapat Singhania. The Company is the second largest manufacturer of
white cement and wall putty in India. Actually, the company has the annual
production capacity of 600,000 tons and 700,000 tons respectively in India.
Establishment: 1975
Headquarter: Kanpur
10. India Cement
India Cements Limited was founded by two men, Shri S N N Sankaralinga
Iyer and Sri T S Narayanaswami. This is one of the most popular cement
companies in southern India. From a two plant company having a capacity of
just 1.3 million tons in 1989, the company has robustly grown in the last two
decades. Presently, the company has a total capacity of 15.5 million tons per
annum. It has 7 integrated cement plants in Tamil Nadu, Telangana and
Andhra Pradesh, one in Rajasthan and two grinding units, one each in Tamil
Nadu and Maharashtra.
Establishment: 1946
Headquarters: Chennai, Tamilnadu
Apart from this listed cement companies, there are several cement
manufacturing companies in our country. Most of them operate as medium
or large scale basis. And they are very popular in a particular region. We
hope this list of top 10 cement companies will help you in getting ideas about
the cement industry in India.
Nirma eyes Rs 4,000 crore IPO for cement arm- The parent Nirma group is
planning an IPO of its cement arm Nuvoco Vistas Ltd (formerly called Lafarge
India) which houses the Lafarge assets. They are looking at raising Rs 4000
crores via the proposed listing and preliminary discussions have been held
with i-bankers like Kotak, Axis, and ICICI Securities amongst others," said one
of the three sources cited above.
CHAPTER 3
COMPANY PROFILE
COMPANY PROFILE:
Nuvoco Vistas Corp. Ltd. was formerly known as Lafarge India Pvt. Ltd.
and changed its name to Nuvoco Vistas Corp. Ltd. in April 2017. The
company was founded in 1999 and is headquartered in Mumbai, India.
Nuvoco Vistas Corp. Ltd. has been a part of the Indian construction
landscape since 1999; through its cement business. It currently has six cement
and close to sixty five ready mix concrete plants in India. It has an established
presence across all major cities and towns in India. The operations across two
business divisions are,
Cements
Ready Mix Concrete (RMX) & Aggregates
Value added Products
BOARD OF DIRECTORS :
DESIGNATION NAME
CHAIRMAN Hiren Patel
MD Jayakumar Krishnaswamy
VISION:
Building a Safer, Smarter and Sustainable World.
MISSION:
We are a reliable construction materials organisation. A organisation that
contributes to the Nation building by providing innovative and Best-in-Class
products and services from home building to infrastructure.
CORE VALUES:
2001-2006:
Acquisition of Raymond Ltd’s Cement division in 2001
Launch of Concreto Cement in 2002
PPC1 mill commissioned at Jojobera Cement Plant
PPC2 mill transferred to Jojobera from Arasmeta Cement Plant
2007-2011:
Plant up-gradation and VRM installation at Jojobera Cement Plant
Mejia Cement Plant is commissioned
Sonadih Cement Plant Line 2 added
Acquisition of L&T’s ready-mix concrete business
Commenced supplies of ready-mix concrete for the iconic World One
building in Mumbai, 2010
Delivered ready-mix concrete to the famous Akshardham Temple in
Kolkata, 2011
2013-2014:
Cement business expansion in North India
Infracem launched for the institutional segment
Our standard Slag Cement relaunched as PSC with strength like steel,
lightest
colour and attractive finish
Duraguard Microfiber Cement launched – 1st ever Fiber Cement for
enhanced strength,
smoother surface finish and minimum surface cracks
Bagged the contract to supply Agile-self consolidating concrete to the
iconic Nazrul Tirtha in Kolkata, 2013
Associated as a ready-mix concrete supplier to the Jaipur Metro Railway
project in 2014
2015:
Sonadih Railway Line Commissioning – enabling operational efficiency
and improved market
connectivity
Won the Noida Metro Railway project as a preferred concrete supplier
2016:
East Grinding Unit, Clinker de-bottlenecking, enhancing production
capabilities
Following divestment from Lafarge Holcim, we became a part of Nirma
Limited
2017:
Nuvoco Vistas Corp. Ltd., the new name of the company, was
registered. We continue to sell products under the brand names
Concreto/ Duraguard/ PSC/ Infracem Cement, ZeroM Water-Proofing
Compound, Artiste, Agile, Steelibre, Polibre, Instante, Robuste, Xlite,
Lente, Regletherme, Fluide, Easyfille and Instamix for a period of time.
Nuvoco bagged the contract to supply concrete to the prestigious
Mumbai Metro Railway project.
OBJECTIVES:
Do it RIGHT the First Time.
FOCUS on SAFETY, QUALITY, COST, DELIVERY.
Develop a culture based on TRUST, TRANSPARENCY, RESPECT,
TEAM WORK, and EXECUTION FOCUSED.
EMPOWER people to take decisions at the lowest possible level.
Build a culture of CONTINUOUS IMPROVEMENT and CUSTOMER
SERVICE minded.
Be a GOOD CITIZEN.
Meet our COMMITMENTS, deliver what we promise and have fun
while meeting our goals.
Develop NUVOCO to be recognised as the BEST BUILDING
MATERIALS COMPANY IN INDIA.
SWOT ANALSIS OF NUVOCO VISTAS:
A study undertaken by an organisation to identify its internal strength and
weakness as well as its external opportunities and threats. It is a framework
used to evaluate a company’s competitive position and to develop strategic
planning. SWOT analysis internal and external factors as well as current and
future potential. It is an acronym which stands for:
STRENGTH WEAKNESS
OPPORTUNITIES THREATS
Novoco recently bagged the 5th CSR Impact Awards 2017-18 in the
Women Empowerment category. Nuvoco’s Project Samridhi won the
award for bringing about economic empowerment of women in the
community by engaging them in sustainable source of livelihood.
The Chief Financial Officer of Nuvoco Vistas Corp. Ltd., Mr. Maneesh
Agrawal, was conferred with the 'CFO100 2019 Roll of Honour'
by CFO India. Nuvoco is one of the country's leading building
materials and Mr. Agrawal earned the accolade for spearheading the
company's initiatives in cost control and management.
Mumbai, India, January 24, 2018- Nuvoco Vistas Corp. Ltd. (formerly
Lafarge India Limited), one of the leading manufacturers and retailers
of construction materials in the country, has been awarded for being
amongst the top 50 companies in India’s first People Capital Index
(PCI) list.
FUTURE PLANS:
REVENUE:
PROFITABILITY:
PROCESS:
CULTURE:
FINANCIAL PROFILE:
1. Production:
The NUVOCO VISTAS products are characterised by reliability, strength,
and innovation. With a focus on research, technology, and technical
innovations, the company has been able to move with time, manufacturing
only the very competent products in building and construction. Below are
some of its products:
Grey cement
Ready Mix Concreto
Portland Pozzolana Cement (PPC)
Portland Slag Cement (PSC)
PRODUCT MIX:
Definition: The Product Mix also called as Product Assortment, refers to the
complete range of products that is offered for sale by the company. In other
words, the number of product lines that a company has for its customers is
called as product mix.
Clinker
Fly ash
Gypsum
Clinker
Slag
Gypsum
Slag is the glass-like by-product left over after a desired metal has been
separated (i.e., smelted) from its raw ore. Slag is usually a mixture of
metal oxides and silicon dioxide.
PRODUCTION PROCESS:
STEP 1:
In the very first step clinker and gypsum are grinded in ROLLER PRESS
( Mill 1), these raw materials are grinded to the required fineness where both
the raw materials turn into a powder substance. In this process the two
rollers as shown in the diagram pressurizes the materials which converts the
raw materials into powder substance.
Next step:
In this step the powder which is formed while grinding the clinker and
gypsum in the above process is transferred into the BALL MILL ( MILL 2)
where fly ash is mixed with the powder. Both the materials are blended
nicely which results in the formation of PPC ( PORTLAND POZZOLANA
CEMENT).
A ball mill is a type of grinder used to grind and blend as shown in the
below diagram.
After the completion of this process, the final product which comes out is
known as PPC. This mixture is stored in a SILO which is further processed
for packaging.
STEP-2:
IN THIS STEP PSC IS PREPARED (PORTLAND SLAG CEMENT). In this step
Clinker and Gypsum are grinder in roller press which is also know as VRM ( Vertical
Rolling Mill). Here in this step clinker and gypsum are grinded till the required
fineness in order to prepare PSC which is contained in a SILO after the process has
been completed.
The output of VRM is further transferred in a SILO. A SILO is used for storing
bulk materials. Its function is to hold and discharge cement. Its maximum
capacity is up to 200 to 800 tons.
Next step:
In this step SLAG is grinded in the roller press or VRM. After the grinding
process the outup is transferred into a different silo. In above step both the
function of grinding clinker, gypsum and slag is being processed in the
ROLLER PRESS or VRM one after the other.
Next step:
BLENDING PROCESS: In this process the output of 2nd step which is stored
in different silo’s are transferred in a blending mill. Here both the powder
substance (i.e., output of grinded clinker and gypsum which is stored in the
1st silo and grinded slag from the 2nd silo) are mixed together in the blending
machine. The outcome of this mixture results in the final product of PSC.
STEP-3:
PACKAGING PROCESS:
After grinding the cement to the required fineness, it will be stored in the
packing house silo.
Silo-1: Silo-2
PPC PSC
As and when the lorries or wagons are placed for loading, the cement from
the silos will be withdrawn to the electronic rotary packer where in there will
be nozzles to insert the spout of the paper bag or HDPE bag, and the cement
will be filled and as soon as the weight becomes 50kg, the bags will be closed
and the packed cement bag will be dropped in a belt conveyor which will be
going upto the loading point of the lorry or wagon and loadmen will be
pulling the bags and put in the lorry or wagon in a stacking manner in such a
way they can count. As shown in the picture below.
CHAPTER 4
CONCEPTUAL FRAME-WORK
CAPITAL BUDGEING:
The importance of capital Budgeting can be well understood from the fact
that an unsound investment decision may prove to be fatal to the very
existence of the concern. The need, significance or importance of capital
budgeting arises mainly due to the following.
1. Large Investments :
Capital budgeting decisions, generally involves large investment of funds.
But the funds available with the firm are always limited and the demand for
funds exceeds the resources. Hence it is very important for a firm to plan and
control its capital expenditure
3. Irreversible Nature :
The capital expenditure decisions are of irreversible nature. Once the
decisions for acquiring a permanent asset is taken, it became very difficult to
dispose of these assets without incurring heavy losses.
2. Uncertainties of future.
6. National Importance :
An investment decision through taken by individual concerns is of national
importance because it determines employment, economic activities and
economic growth.
9. Cost control :
In capital budgeting there is a regular comparison of budgeted and actual
expenditures. Therefore cost control is facilitated through capital budgeting.
With pay back and/or other techniques, about 2/3rd of companies used IRR and
about 2/5th NPV. IRR s found to be second most popular method.
6 3
PROJECT PROJECT
REVIEW EVALUATION
5 4
PROJECT PROJECT
EXECUTION SELECTION
1. Project generation :
The capital budgeting process begins with generation or identification of
investment proposals. This involves a continuous search for investment
opportunities which are compatible with firm‟s objectives.
2. Project screening :
Each proposal is then subject to a preliminary screening process in order to
assess whether it is technically feasible, resources required are available, and
expected returns are adequate to compensate for the risks involved.
3. Project evaluation :
After screening of project ideas or investment proposals the next step is to
evaluate the profitability of each proposal. This involves two steps;
Estimation of cost and benefit in terms of cash flows
4. Project selection :
After evaluation the next step is the selection and the approval of the best
proposal. In actual practice all capital budgeting decision are made at
multiple levels and are finally approved by top management.
6. Performance review :
After the implementation of the project, its progress must be reviewed at
periodical intervals. The follow-up or review is made by comparing actual
performance with the budget estimates.
Most of the large firms prepare two different budgets each year.
1. OPERATING BUDGET :
Operating budget shows planned operations for the forthcoming period and
includes sales, production, production cost, and selling and distribution
overhead budgets. Capital budgets deals exclusively with major investment
proposals.
A firm may have several investment proposals for its consideration. It may
adopt one of them, some of them or all of them depending upon whether
they are independent, contingent or dependent or mutually exclusive.
Kinds of
capital
investme
nt
proposal
1. INDEPENDENT PROPOSALS :
These are proposals which do not compete with one another in a way that
acceptance of one precludes the possibility of acceptance of another. In case
of such proposals the firm may straight away “accept or reject” a proposals
Indepen Depende Mutually Replace Expansio Diversifi Capital
on the basis
dent
of
nt
minimum
exclusive
return
ment
on investment
n
required.
cation
All these proposals
rationing
which
proposalgive a higherproposal
proposal return than a certain
proposal desired
proposal rate of
proposal return are accepted
proposal
and the rest are rejected.
4. REPLACEMENT PROPOSALS :
These aim at improving operating efficiency and reducing costs. These are
called cost reduction decisions.
5. EXPANSION PROPOSALS :
This refers to adding capacity to existing product line.
6. DIVERSIFICATION PROPOSALS :
Diversification means operating in several markets rather than a single
market. It may also involve adding new products to the existing products.
Diversification decisions require evaluation of proposals to diversify in to
new product lines, new markets etc., for reducing the risk of failure.
RETURN
EXPECTED
FROM
INVESTMENT
Payback Method
Internal
Average
Net Present
Rate Point
of
Profitability
Cut-off Worth
Return
Index
A business firm has a number of proposals regarding various projects in
which it can invest funds. But the funds available with the firm are always
limited and it is not possible to invest funds in all the proposals at a time. The
most widely accepted techniques used in estimating the cost returns of
investment projects can be grouped under two categories:
Annual cash inflow is the annual earning (profit depreciation and after taxes)
before
3. A firm which has shortage of funds find this method very useful.
4. This method costs less as it requires only very little effort for its
Computation.
DISADVANTAGES :
1. This method does not take in to consideration the cash inflows beyond the
payback period.
ACCEPTANCE RULE :
The following are the Payback [P.B.Rules]
Where;
Average Annual Earnings is the total of anticipated annual earnings after
depreciation and tax (accounting profit) divided by the number of years.
TOTAL CFAT
AVERAGE ANNUAL EARNING=
NO. OF YEARS
Whereas:
CFAT means cash inflow after tax.
TOTAL INVESTMENT
AVERAGE INVESTMENT= 2
3. The earnings over the entire life of the project is considered for
DISADVANTAGES
1. Like the payback period method this method also ignores the time value of
money. The averaging technique gives equal weight to profits occurring at
different periods.
3. It makes use of the accounting profits, not cash flows, in evaluating the
project.
2. Compute the present value of total investment outlay (i.e., cash outflow) at
the determined discounting rate.
3. Compute the present value of total cash inflows (profit before depreciation
and after tax) at the above determined discount rate.
4. Subtract the present value of cash outflow (cost of investment) from the
present value of cash inflows to arrive at the net present value.
5. If the net present value is negative i.e., the present value cash outflow is
more than the present value of cash inflow the project proposals will be
rejected .If net present value is zero or positive the proposal can be accepted.
6. If the projects are ranked the project with the maximum positive net
present value should be chosen.
The Internal Rate of Return for an investment proposal is that discount rate
which equates the present value of cash inflows with the present value of
cash outflows of the investment. The Internal Rate of Return is compared
with a required rate of return. If the Internal Rate of Return of the investment
proposal is more than the required rate of return the project is rejected. If
more than one project is proposed, the one which gives the highest internal
rate must be accepted.
It can be calculated by the following formula:
PVLDF - CoF
IRR= LDF%X DF%-
PVLDF - PVHDF
Whereas:
LDF= Lower Denominator Factor
DF%= Difference between the lowest and the highest denominator factor
PVLDF= Present value of the lower denominator factor
CoF= Initial investment
PVHDF= Present value of the highest denominator factor.
DISADVANTAGES :
1. Difficult to calculate.
2. This method presumes that the earnings are reinvested at the rate earned
by the investment which is not always true.
This is also called Benefit-Cost ratio. This is slight modification of the Net
Present Value Method. The present value of cash inflows and cash outflows
are calculated as under the NPV method. The Profitability Index is the ratio
of the present value of future cash inflow to the present value of the cash
outflow, i.e., initial cost of the project.
If the Profitability index is equal to or more than one proposal the proposal
will be accepted. If there are more than one investment proposals, the one
with the highest profitability index will be preferred.
This method is also known as Benefit-Cost ratio because the numerator
measures benefits and the denominator measures costs. ”It is the ratio of the
present value of cash inflow at the required rate of return to the initial cash
outflow of the investment.
Project Planning:
The planning of a project is a technically pre- determined set of inter related
activities involving the effective use of given material, human, technological
and financial resources over a given period of time. Which in association with
other development projects result in the achievement of certain
predetermined objectives such as the production of specified goods &
services?
Project planning is spread over a period of time and is not a one shot activity.
The important stages in the life of a project are:
1. Its Identification
5. Its implementation
The time taken for the entire process is the gestation period of the project. The
process of identification of a project begins when we are seriously trying to
overcome certain problems. They may be non- utilization to overcome
available funds. Plant capacity, expansion etc .
5. Building
6. Production capacity.
7. Work Schedule
1. Cost of land
2. Cost of Building
7. Preliminary expenses
8. Pre-operative expenses
Production cost.
Depreciation.
Rate of Taxation
To make an estimate of capital expenditure and to see that the total cash
outlay is within the financial resources of the enterprise
To ensure timely cash inflows for the projects so that no availability of cash
may not be problem in the implementation of the problem.
Evaluation of performance.
GENERAL GUIDELINES:-
2) New schemes
4) Township
6) EDP schemes
CONTINUING SCHEMES :
These schemes include all such schemes which are under implementation of
which funds prevision has been made in the current year /prevision is
required in the budget year.
NEW SCHEMES :
This scheme includes all such schemes, which are proposed to be initiated in
the budget year and for which under provisions is required in the budget
year. Normally, such schemes are included in the five-year plan of the
company approved by the planning commission.
4. Quality/testing facilities.
5. Welfare
6. Minor works.
TOWNSHIP :
Township budget is divided into two parts.
Funds required under each schemes should be backed up with full data on
number on quarter/scope of work to be completed against the funds
requirements phasing of budgeted funds for current year, budget year and
following year etc, should be given similar information on number of
quarter/scope of work already completed, expenditure incurred till last year,
satisfaction level it is to be added in the above back up information for each
scheme.
Continuing schemes.
The schemes should fall in any of the above cartages giving details on
physical and financial progress etc.
EDP SCHEMES :
All funds requirements for computer are information system should be
grouped under EDP schemes and projects accordingly.
BUYING OR PROCURING:
Buying or procurement involves purchasing an asset permanently in the
form of cash or credit.