Kota

kota

The Forecast of Financial Management in Kota Fibres:

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Prepared for Ms. Pundir, the managing director of Kota Fibres

Table content:

Executive summary--------------------------

The background of Kota Fibres------------

Industrial analysis------------------------------

Internal and external issues exposed---------

Financial analysis-------------------------------

Recommendation --------------------------------

Executive summary

Ms. Pundir, the managing director and principal owner of an India firm called Kota Fibres, Ltd., found a very serious problem about her company in early January 2001. The trucks filled with productions were being unloaded because the excise tax had not been paid for the government tax inspector who would come in a timely manner. At the same time, the bookkeeper of Kota, Mr. Mehta, found another problem that the company had overdrawn its bank account again. These two issues were found both in the end of the financial year. Furthermore, they realized that more chain reflections had happened and would continue effecting Kota’s operating. Even though Kota’s profit status is going better and better, their financial statement always seems not that “good looking”. In a word, thin profit margins had prompted Pundir to adopt policies against overproduction and overstocking, which required her to carry inventories through the slack selling season. It is an adjustment about the restoring the firm’s liquidity between the bank and Kota itself. Ms. Pundir has received stack of memo, I would like to make a brief analysis and recommendation to her.

The background of Kota Fibres

Kota Fibres, Ltd. was founded in 1962 in Kota, India. It focuses on producing nylon Fibre; Kota Fibres provided synthetic Fibre yarns to local textile weavers mainly to make the traditional women’s dress (saris) in India. The way Kota deals with those weavers is franchising. Ms. Pundir was both the managing director and principal owner of...