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Account payable is related to processing of invoice and payment to party . The subject matter of Financial Management has been changing at rapid pace. About a decade ago, the scope of Financial Management was circumscribed to the raising of funds, whenever needed, the financial decision making, and problem solving. But now it has become an integral part of any business enterprise and growth of any business enterprise depends largely on their financial strategy and how finance is being managed. The summer training program is designed to give the future managers the feel of the corporate happenings and work culture. Theses real life situation are entirely different from the stimulated exercise enacted in an artificial environment inside the classroom and it is precisely because of this reason that this summer training has been designed, so that managers of tomorrow does not fill ill in the case when the times comes to shoulder responsibilities. The summer training is a bridge between the institution and organization to make us understand how theoretical knowledge will be applied in the practical field. It was exactly in this context that I was privileged to join Jindal steel & power Ltd. (Finance Division) as a summer trainee. The experience that I have gathered over the past two months has certainly provided me with an orientation, which I believe, will help me shoulder any assignment successfully in
ACKNOWLEDGEMENT
First of all I would like to express my whole hearted thanks and deep gratitude to my parents who have always been my source of inspiration for any challenging work, project, or assignment. Any work is not perfect and complete without the help and guidance from other people. This project work of mine Account pyabale would not have reached its fulfillment, hadnt it been the guidance given to me by various people directly or indirectly related to this project. At first, I deeply express my gratitude to my (HOD) Mr. Anant Srivastava and my faculty Guide for giving necessary instruction and guidance on how to pursue this summer project. I really found your guidance extremely helpful at every step of the research and in analyzing the various facts and figures. I would also extend my sincere thanks to Mr. Husan sir(head of training in charge in hr) for providing me an opportunity to do a project work in their esteemed organization. I whole heartedly acknowledge the intellectual stimulation of my esteem Project Guide, Mr. Abhijet Mandal sir ( Hod of Finance Department) for his continuous help and guidance throughout the project duration in spite of his busy schedule. I thank to my mentor Ms. versa Rajawat mam (Finance dept.) .
Guide certificate
To whom it concern I am Sapna Singh and I have done my summer training for Account payable from Jspl patratu (Jharkhand) and my Gide was there Varsha Rajawat mam. I am doing MBA from Shri Ram Murti Smarak Collage Of Engg. &Tech. Bareli.
Varsha Rajawat
TABLE OF CONTENT
Page no
About the organization
Introduction History
Strong pillars Key person Product Achievements 7 to 10 10 to 13 14 15 to 17 18 to 22 23 24 25 to 27 30 to 38 30 31 32 33 to 34 35 36 to 38
Jspl patratu
Overview Facilities Growth potential of steel Steel making process of steel making wire , road and plates steel making reforms other fasilites
Topic
Account payable
Introduction Overview process Store department PPC department Financial /account Department sales tax
40 40 42 to 53 54 to 58 59 to 62 63to 71 72 to 74 75 76 to 78 79 to 80 81 83
TABLE OF CHART
Chart no. Page no.
Account payable process store Transportation bill Service bill Material Bill Finance /account department Exices department Payable Types of bill Types of form types of permit 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.1 2.2 2.3 42 54 60 61 62 63 64 64 66 67 72 74
ACCOUNTS PAYABLE
INTRODUCTION OF A/CS PAYABLE:Accounts payable is a strategic, value-added accounting function that performs the primary non-payroll disbursement functions in an organization. As such, the AP operation plays a critical role in the financial cycle of the organization. AP enables an organization to accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of the entire payables process. In addition to the traditional AP activities whereby liabilities to third-party entities (suppliers, vendors, taxing authorities, etc.) are recognized and paid based on the credit policies agreed to between the company and its suppliers, today's AP departments have taken on much wider roles including fraud prevention, cost reduction, workflow system solutions, cashflow management, internal controls and vendor (supply chain) financing. It is the obligation that business owes to its creditors for buying goods or services. It is The Unpaid Invoices, Bills, or Statements for Goods or Services Rendered by outside Contractors, Vendors or Suppliers. Accounts Payable Are Sometimes Referred To As "Payables."
OVERVIEW:In recent years, accounts payable (A/P) operations have automated and streamlined their processes. New technology, such as electronic invoice presentment and payment (EIPP) and electronic funds transfer (EFT), has enabled automation of many A/P transactions. Businesses also have recognized that A/P professionals can play a strategic role in advancing a companys financial goals if they shift focus from transaction-oriented Processes to value-adding activities. Leading companies use a variety of EFT tools to make payments Electronically and rely on computer-assisted audit techniques (CAAT) and techniques (CAAT) and other technology-based antifraud procedures to monitor and stop illegal A/P Transactions. Many companies also seek to streamline or eliminate steps in A/P transactions, such as invoice processing. Despite this push toward automation, companies still strive to maintain a strong relationship-based focus. They seek progressive approaches to supplier communications, payment timing, and fraud prevention. They also leverage other organizational initiatives, such as regulatory compliance and Internal control efforts, to achieve better A/P efficiency.
A company's outstanding debts, or liabilities, to vendors for purchases of goods and services made on credit.
It's important to track accounts payable in a timely manner to ensure that you know how much you owe each supplier and when payment is due. Many a good supplier relationship has been damaged due to a sloppy accounts payable system. Also, if your suppliers offer discounts for payment within 10 days of invoice, a good automated accounts payable system will alert you when to pay to maximize the discounts earned.
User
Purchase Department
Security
Purchase Requisition (P R)
Purchase order (P O)
Gate Entry (G E)
PPC Department
Store
Goods Receipt Note
Invoice
(GRN)
User
GRN Verification PPC Finance
Chrt: 1.1
1) Put Transaction Code:-Me51n 2) Put Patratu Material There Are Two Types of Material a) Raw Material b) Services 3) Material Code:-Material Code Should Be In Ten Digits. Ex:-100018786 4) Material Description:-Quality, Tentative Price, Plant 5) Requistioner:-It Means That the Person Who is the Head of Department
6) Account Assignment Category:-Under this we check that for purchasing material money is available or not.
10. Purchasing Group 11. Requisitioned 12. Purchasing Organization 13. Tracking No 14. Account Assignment Category 15. WBS Element No. / Cost Center / Internal Order
STEPS:1) Put Transaction code:-ME21N 2) Define: - patratu material or service depending on purchase requisition raised. 3) Enter vendor code. 4) Organizational data like company code, purchasing group, purchase organization. 5) At the suitable place, give the particular PR no. with line item no. 6) After this system will import the data from PR. Ex: - material code, material description, quantity, unit of measurement etc. 7) Then give delivery/ Invoice
a) Payment terms depending upon the negotiation. b) Inco terms. 8) Enter invoice means taxes, either VAT, EXCISE DUTY or CST. 9) Put delivery date 10) Put unit price and necessary terms and conditions. 11) After feeding all the data, then purchase order is saved and unique PO no. is generated.
2) DELIVERY Material shall be door delivered to JSPL site as per DELIVERY DATE or earlier 3) FREIGHT In the scope of seller or buyer scope. 4) PAYMENT TERMS 100% payment within such n such days ( depend on the negation ) from the date of receipt and acceptance of materials at our site . 5) PACKING The material shall be roadworthy packed as per the Indian standards considering multiple handling and long storage period at site . The seller shall take suitable precaution and measures to protect the goods against dampness , moisture ,rain , rust, shock and deformation etc. All expenses in this connection shall be borne and paid by the seller alone.
Should it be proved that the material are damaged and/or lost, attributable to improper packing or inadequate protective measure , the seller shall be liable for free replacement of same. 6) WARRANTY The seller warrants that the materials to be supplied by the seller shall be brand new , unused and free from any material defects and shall be off good workmanship in accordance with the technical specification and/or applicable standards . 12 months from the date of commissioning or 18 months from the date of supply whichever Is earlier. 7) INSPESTION Inspection of materials shall be carried out at site . All necessary certificates, Internal Inspection report s, test reports shall be submitted along with dispatch document .In the event of supplied material not matching with our TS requirements the same shall be rejected & returned at your risk & cost . INDEMNITY 8) The seller shall indemnify and hold buyer harmless from any loss , cost, claim expenses or liability arising from adverse claim by any third party with respect to goods delivered to buyer. 9) TERMINATION In the event of the seller failure to comply with any of the terms & conditions of this contract and/or perform or observe the obligation imposed on it buyer shall be entitled to forthwith termination this order . Upon such termination ,the injured party shall be entitled to claim all damages/cost and expenses etc. Which it may suffer/incur as a result thereof.
10) FORCE MAJEURE Force majeure means any accordance event or circumstances such as act of god, sabotages , civil commotion, riots, insurrections, revolution, blockades, earthquake, fire , floods, lightening , storms , typhoon etc. In such case the time for completion
of the work shall be extended for a reasonable period to be determined by mutual agreement between seller & buyer. 11) RISK PURCHASE In the event of seller defaulting in supplying the material to be supplied under this contract to the purchase within a stipulated time agreed between the parties , the purchase shall have the rights to procure required material from an alternate source at seller cost & risk including incidental expenses/taxes etc.
12) ARBITRATION AND APPLICABLE LAW Any dispute arising shall be referred to any finally resolved by arbitration under the rules of arbitration of Indian council of arbitration (the Ica rules) as amended in force , from time to time . This contract shall be governed by Indian law as applicable . Any disputes and differences arising will be subject to the jurisdiction of that particular place court (buyer place) and has only exclusive jurisdiction in the matter .
12) ROAD PERMIT The requirement of road permit shall be intimated by the seller in advance for dispatch of material. Further the utilization statement shall also be submitted by seller before issue of fresh forms to seller. 14) OTHER 1) You will have to provide us Excise controlled Invoice to enable us to claim CENVAT. (if excise duty is involved ) 2) Please ensure that all dispatch document containing commercial Invoice ,Excise Invoice ,Challan , Packing List and Material test Certificate /Physical Inspection Report etc . Are sent alone with the consignment .
3) In Excise Invoice ,in any case , consignee name address must be mentioned subheading must be proper and according to commodity & in 8 digits . in case of your failure to comply with above ,we may reject the supplies to at your cost & risk . 4) The material must be dispatched through your authorized transporter on freight PAID basis or to pay basis (depend on the negotiation). 5) All necessary test certificate should be dispatched along with consignment. 6) Please mention our item code strictly in your Invoice while dispatching the materials.
After sending the material by the vendor, when materials are reached to the company then security department does some gate entry. Under gate entry system the security guards check the following document:a) Supplier or vendor name. b) Challan no. and PO no. c) Details of material like rate, weight, quantity, description of material. d) Truck no. and driving license no. e) RC (Owner Book):-name of vehicle, chasis no., engine no., driver name, type of vehic
STORE
Store
Receipt department
Issue department
Cart:1.2 After that G. E loaded truck with material came in store than it will be weighted that is called cata according to nature of material for example litter, tone , meter and unit etc. and here standard weight is 100 tone and 30 tone.
RECEIPT DEPARTMENT
After loading it will came in receipt department here checked all necessary document and first of all they checked own name of the company for confirmation that consignment is our or not if its ok than checked other papers just like. 1) Bill 2)Invoice 3)Chalan 4)Purchase Order 5)Excise 6)Road permit
7)Bilty NOTE:-no.7 is necessary only that time when vehicle have transporters and the have give bilty no. Receipt department has checked P.O. order and compare with chalan if every thing is ok than they accept the bill of party. Than after they call the user (who make the PR) for checked the material it is ok or not if it is ok than they make GRN(goods Receipt Note) ,if there is any kind of mistake for example shortage than they mention in the report(GRN)or if it not up to the requirement than they reject the material .
ISSUE DEPARTMENT
Material issue slip
If user did not take the material directly that time when party deliver the goods than they have collect the material through the issue department. With the help of material issue voucher gated signed by the HOD . Then issue department checked the Budget of the user department if there is enough balance then issue department issue the material as per requirement of the user .
ISSUE DEPARTMENT USE SOME MOUEMENT TYPE FOR TRANSATION:1) FOR TRANSFER Mblb
2) FOR POSTING mbla 3) TO CHECK BUDGET Zps_budget 4) FOR SAME PLANT (WBS toWBS) Movement type 415Q (special material) 301 (general)
me2m-: With help of material code to see the purchase order. 412Q-: Transfer from General to WBS. 411Q-: Transfer from WBS to Ge
PPC DEPARTMENT RECEIVED THE BILL FOR TWO WAYS:1)Through party 2)Through store department
BILLS CYCLE
TRANSPORTATION BILL
6. Purchase for
payment payment
4.
5.
No If Observation
Yes
Chart 1.3
payment payment
No If Observation
Yes
Chart 1.4
Material Bill
6.Purchase for payment
No
Yes
If Observation
Chart 1.5
Excise
Payables
Cheque Creation
Signing Of Cheque
Payment to Party
Chart 1.6
FINANCE DEPARTMENT
Bill will be come in finance department after that PPC Dept. it will be received by finance dept for for the verification of the bill carefully before payment to the party that is called bill receivable .After B/R it will be transfer in excise dept. for charged the required taxes which is very important of the every company .
Finance department
Excise
Payable Payable
Chart 1.7
EXCISE DEPARTMENT
Excise department has been charged all types of taxes which required according to material.
Excise Department
Input credit
Capital Goods
1oo%taxable
Machinery, cable
Char 1.8
Types Of Material
1)Fully tax free material 2)Partly tax rebate same year and partly next year 3)Fully taxable material.
Partly Tax Rebate Given Same Year & Partly Next Year
Under this categories that type material include which not include directly in production and other types of material also .Which are receive the tax rebate 50% same year and 50% next year.
General ENTRY BED A/C ED A/C SHESS A/C TO GENRAL CLEARING A/C Dr. Dr. Dr.
PAYABLE
Payable dpt. Is also divided into two part service and supply in this dpt.all bills will be verified that is called Miro (invoice verification). After that miro bill booking and generate a new number this is invoice no.
Payable
Service
Supply
Miro
chatr 1.9
Services Bill
Supply bill
Purchase order
Purchase order
Work order no
Chart 2.1
Invoice date
Reference
Bill no.
107/107
Activity Description
Details
Business aria
7000
Document type
R M Invoice
Assignment
P.O no
Payment
Print mathed
C(check)
TAX
In calculate tax will click in the calculate tax column whatever tax will be charged it will be automatically add to the basic amount column will be sown in the total amount.
Withholding Tax
In withholding tax column will be deducted the TDS as per the required .
Simulate
Than will be post the document. When it will be generate the document no . This document no. is deferent for the making cheque
General Entry For Miro General clearing a/c To, Payable a/c dr
SALES TAX
Sales tax dept. is related to the tax which is given or received to the related party if company purchased the material than give the tax or if sale than received the tax. In Case Of Purchase: If company purchase the material or received any kind of service to another company than have to pay tax only that time when company has been registrar. In Case Of Sales : If company sales then company have to received the tax according to the amount and nature of the material also . in case company did not charged tax or less charge according to the terms & condition than it will have to pay the tax to own side to the government .So that company have to very carefully for charged and calculate tax.
This dept is issue the form and permit also which is required for the business because without form business cant work properly .And these form issued by the government .
C Form
F Form
E Form
Chart 2.2
C FORM C form issue with two condensation purchase and sales . In case of sales if company charged only 2% cst than we received c form to the party agenst the 2% cst because it is prove for tax payment of 2% only. In case of purchase if we are charged the cst to the party only 2% than if party wanted c form than company issued the c form. It has three copy one is taken to the party and another one take the related dpt of material and last one is taken to the sales tax dept. as a prove.
FORM F This form is used only inter branch transation for purchase or sales .
TYPE OF TAX
VAT Vat is related to that type of material which is transit under state. Some popular % of vat are 4%, 5%,12%, &12.5% etc. SALE TAX Sale tax is related to that type of material which are transfer out of state and this time it is running on 10%
PERMIT
Permit is written document as a permission of the government for sales or purchased of the required material & product one place to another place without any restriction of the government.
PERMIT
PINK
BLUE
GREEN
With in state
Outside state
Export &purchase
Chart 2.3
PINK PERMIT
Pink permit is issued by the company who sale the product to another company or another branch for transfer of consignment without any problem. It is a written permit of the government for interstate business. Its paper colure is Pink that why permit it is called pink permit colure is also helpful for knowing easily .
BLUE PERMIT
Blue permit is related to the other state transaction permit. It means if anybody have blue permit with consignment than they have permission to transfer the material to one state to another state easily without any problem because they have permission of the government for business.
GREEN PERMIT
Green permit is permission for business to other country .it means with green permit government has provide permission for import & export.
BUDGETING
BUDGETING in simple word it is predication of the future for financial exp.It means budgeting is list of exp. For defiant time and subject both. In another word we can say that it is list of exp for future . With the help of budget we can predict the future.
BLANCESHEET
BALANCE SHEET AS AT 31st MARCH 2010 Jharkhand Schedule 31-Mar-10 SOURCES OF FUNDS SHAREHOLDERS' FUND Share Capital Reserves and Surplus Employees' Stock Options Outstanding Less :- Deferred employee compensation expenditure (see note 8 of Schedule 20) Business Area clearing Branch Accounts 10,731,811,073.95 10,731,811,073.95
LOAN FUNDS Secured Unsecured DEFERRED TAX LIABILITY (NET) TOTAL APPLICATION OF FUNDS FIXED ASSETS Gross Block Less:Depreciation Add: Capital work in progress (including preoperative expenses pending allocation/capitalization and Capital goods lying in stores)
3 4 20 10,731,811,073.95
3,405,841,555.25 8,248,995,852.03 6
INVESTMENTS
CURRENT ASSETS, LOANS AND ADVANCES Inventories Sundry Debtors Cash and Bank balances Loans and Advances
7 8 9 10
11 12
NET CURRENT ASSETS Debit balance of profit & Loss Account MISCELLANEOUS EXPENDITURE (to the extent not written off or adjusted) TOTAL Diff 2 13
JINDAL STEEL & POWER LIMITED PROFIT AND LOSS ACCOUNT FOR THE MONTH ENDED 31ST MARCH, 2010 Jharkhand Schedule 31-Mar-10 INCOME Sales and Operational Income Less: Inter Branch Transfer Less: Excise Duty Net Sales and Operational Income Other Income 14 2,758,785.00 770,086.00 1,988,699.00 229,532.00
15
2,218,231.00 EXPENDITURE Material, Manufacturing and others Less: Inter Division Transfer 16 24,156,477.76 24,156,477.76 48,039,489.63 47,795,449.99 (393,286.27)
Personnel 17 Administrating and Selling 18 Interest 19 Employees compensation expenses ( under ESPS scheme) Miscellaneous Expenditure written off Provision for Diminution in value of Investments Depreciation 5
3,504,004.47 123,102,135.58
PROFIT \ (LOSS)
(120,883,904.58)
PROFIT BEFORE TAXATION LESS: Provision for taxation (a) Income tax - For Current Year - For Previous Year (b) Deferred tax (c) Wealth Tax (d) Fringe Benefit Tax PROFIT AFTER TAXATION ADD/(LESS) Surplus / (Loss) brought forward Debenture Redemption Reserve written back PROFIT AVAILABLE FOR APPROPRIATION Interim Dividend on Preference Shares Interim Dividend on Equity Shares Corporate tax on Interim Dividend Proposed Dividend on Equity Shares Proposed Dividend on Preference Shares Corporate tax on Proposed Dividend General Reserve Capital Redemption Reserve Debenture Redemption Reserve Balance carried to Balance Sheet
(120,883,904.58)
(120,883,904.58) (986,560,323.09)
(1,107,444,227.67)
(1,107,444,227.67) Basic Earning per share (in Rs.) (See note 15 of Schedule 20) Diluted Earning per share (in Rs.) (See note 15 of Schedule 20) Significant Accounting Policies & Notes to Accounts 20 The accompanying schedules 1 to 20 form an integral part of these accounts
Notes: 1) The TDS on the provision shown in outstanding liabilities has been provided 2) we have added the capital inventory stores and spares in Capital
BIBLIOGRAPHIC
During at the time of training I have taken help from both types data primary or secondary. Under primary data who gave me their support and help both .
NAME
Husan sir Abhijet mandal
POSITION
DEPARTMENT
HR
Finance
Kisor chandra gouda L N mandal Om prakash prasad Purusotam Neha srivastav Anup sir Warsa rajawat
Store Store
Store(receipt) Store(issue) PPC deot. Purchase Finance Finance(survice bill) Finance (supply bill)
Preeti agarwal
Ravi sir
Secondary data Secondary data is more helpful for making report .So many maters which is collected with the help of net and books also.Here generally I have take the help from some books of A/c Which author name is Dr. S.P. Gupta and R . S. Agrawal
Questionnaire
1)In Jspl , Patratu branche Inventory management
is ? a) Satisfied
b) Unsatisfied
c)Fully satisfied d)Fully unsatisfied Ans: b) Unsatisfied 2)Work with sap campare to previous software which is used after sap is? a) Satisfied b)Unsatisfied c)Fully satisfied d)Fully unsatisfied Ans: c)Fully satisfied 3) Working environment in patratu branch compare to other branches is? a) Satisfied b)Unsatisfied c)Fully satisfied Ans: a) Satisfied d)Fully unsatisfied
4)Providing facilities are ? a) Satisfied b)Unsatisfied c)Fully satisfied d)Fully unsatisfied Ans: a) Satisfied 5)PPC Department has been doing the work as a bridge so it is? a) Satisfied b)Unsatisfied
c)Fully satisfied d)Fully unsatisfied Ans: a) Satisfied 6)A/c Payable procedure is required to every organization? a)Yes Ans: Yes b) No