Você está na página 1de 79

Summer Training Report

On

REVENUE BUDGET

At

INDIAN OIL CORPORATION LIMITED

(MATHURA REFINERY)

SUBMITED IN THE PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE AWARD OF THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION

BY

PRADEEP KUMAR

ROLL NO. 0725170041

(2007-09)

Summer Training Report On REVENUE BUDGET At INDIAN OIL CORPORATION LIMITED (MATHURA REFINERY ) SUBMITED IN

G.L.A.

INSTITUTE OF BUSINESS MANAGEMENT, MATHURA (U.P.) (Affiliated to U.P. Technical University, Luck now)

GREEN REFINERY

CLEAN REFINERY

1

MATHURA REFINERY

DECLARATION

  • I hear by declare that this project report submitted in M.B.A.of

G.L.A.I.B.M. Mathura is the result of my own work.

  • I also declare that to the best of my knowledge & belief the report is my self individual.

Place: Mathura

Pradeep Kumar G.L.A.I.B.M

MBA (3 nd Sem)

GREEN REFINERY

CLEAN REFINERY

2

MATHURA REFINERY

ACKNOWLEDGEMENT I would like to take this opportunity to express my gratitude towards all those who

ACKNOWLEDGEMENT

  • I would like to take this opportunity to express my gratitude towards all those who have, in various ways, helped me in the completion of this project.

  • I would like to take this opportunity to thank Mr.S.VIJAY MOHAN, CM (MS

& TRG)

IOCL (Mathura Refinery) for giving me the opportunity to work with them and providing

me with necessary resources for our project.

  • I take this opportunity to extend my sincere thanks to Mr. L.P.BHATTRAI Finance

Manager, IOCL, (Mathura Refinery) and my project guide in the company, Mr. ANSUL BANSAL guiding me to complete the project.

  • I would also like to thank the Finance Department, IOCL Mathura for making me

familiar with the intricacies of project development and ensuring that work in a systematic

way.

Also, I would like to extend my gratitude to my institute- G.L.A.I.B.M for giving me an opportunity to have a practical experience of job.

A warm thanks to all my Colleague Trainees for their cooperation and support throughout the development process of this project.

GREEN REFINERY

CLEAN REFINERY

3

MATHURA REFINERY

TABLE OF CONTENTS

Title page

Certificates

Preface(DECLARATION)

Acknowledgement

Table of content

Chapter 1 Introduction

Chapter 2 Introduction about Mathura refinery

Chapter 3 Budget

Chapter 4

Revenue Budget

Chapter 5 Research Methodology

Chapter 6

Analysis and Interpretation

Chapter 7 limitations

Chapter 8 Finding and conclusion

Chapter 9 Graph

Chapter 10 Annexure

Chapter 11 Glossary

Chapter 12 Reference

GREEN REFINERY

CLEAN REFINERY

4

MATHURA REFINERY

INTRODUCTION OF IOCL

INTRODUCTION OF IOCL 5

5

GREEN REFINERY

CLEAN REFINERY

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY INTRODUCTION ABOUT IOCL Welcome to the world of Indian Oil.

MATHURA REFINERY

INTRODUCTION ABOUT IOCL

Welcome to the world of Indian Oil. Under the administrative control of the Ministry of Petroleum & Natural Gas, Govt. of India.

Indian Oil, the largest commercial enterprise of India (by sales turnover), is the only Indian company to find a place in Fortune's "Global 500" of the world's largest companies (Rank 116 in the 2007Global 500). Among Petroleum Refining companies, it has a global ranking of 17 in terms of revenue. IOC ranks at 189 in the Forbes International listing of 500 largest non-US companies for the year 2007.

Indian Oil touches every Indian’s heart by keeping the vital oil supply line operating relentlessly in every nook and corner of India. With the backing of over 33% of the country’s refining capacity as of 1st April 2007 (over 48%, if the capacity of recently acquired subsidiaries is also added) and 6523 kms of crude/product pipelines across the length and breadth of the country, Indian Oil’s vast distribution network of over 21,000 sales point ensures that essential petroleum products reach the customer at the "right place and right time".

6

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

Indian Oil’s marketing share is about 53.2% among oil public sector undertakings India. Indian Oil’s activities are backed by its "Research and Development Center", the first such center established in India. This center has over the years grown into a major technological development center of international repute. Indian Oil also has four overseas offices in Kuwait, Kuala Lumpur, Dubai and Mauritius. As the premier National Oil Company, our endeavor is to serve the national economy and the people of India.

We also have a "vision beyond tomorrow" – of becoming an integrated and diversified "Global Energy Corporation". We are continuously innovating and strengthening areas of core competence. At the same time, we are exploiting opportunities offered in the new liberalized scenario by globalizing and diversifying into related areas.

FOUNDATION

Indian Oil Corporation Ltd. and Indian Oil Company Ltd. Were set up in the year 1958and 1959 respectively to build national competence in the Oil refinery and marketing business. On 1 st September these two companies merged to form Indian OIL Corporation Ltd. (Indian Oil) In 1981, Assam Oil Corporation was born. In 1981, Assam Oil Corporation, a private sector company was nationalized and merged with Indian Oil Corporation.

7

GREEN REFINERY

STRUCTURE

CLEAN REFINERY

MATHURA REFINE

Indian Oil carries its activities through its five divisions namely:

  • 1 Refinery Division

  • 2 Pipe Line Divisions

  • 3 Marketing Divisions

  • 4 Assam Oil Divisions

  • 5 Researches and Development Division

A Board of Directors manages the company. Besides the Chairman, the Board has the following full time directors.

  • 1. Director (Refinery)

  • 2. Director (Pipeline)

  • 3. Director (Marketing)

  • 4. Director (Finance)

  • 5. Director (HR)

  • 6. Director (P&BD)

  • 7. Director (R&D)

REFINERIES

Refineries

Year of commencement

Guwahati

1962

Barauni

1964

Gujarat

1965

Haldia

1975

Mathura

1982

Panipat

1999

GREEN REFINERY

CLEAN REFINERY

8

MATHURA REFINERY

Besides the above refineries, namely Digboi refinery is in AOD with installed capacity of .5 million tones. One more proposed refinery Paraded refinery is also under construction with

the capacity with the capacity of 6.0 million.

OIL PIPELINES

Indian Oil has the country’s largest network of on-land crude and product pipelines, with a combined length o f6, 453 km and 43.45 MMTPA capacities.

MAJOR FEATURES

INDIAN Oil Corporation (Indian Oil) is the largest commercial enterprise in India. Indian Oil continue to be the loan Indian presence in the Fortune “Global 500” listing of world’s largest Corporation for the sixth consecutive year. In the largest Fortune listing based on data for fiscal 2007,Indian Oil is ranked 189 by revenue, 46 steps ahead of the last year’s position. Among the petroleum refining companies Indian Oil continues to be the 16 th largest in the world. Indian Oil is the only Indian company chosen as one of the 15 most admired companies in the world in the petroleum Refining category as per the survey conducted by Hay Group Consultancy for Fortune Magazine. In the “2000 Industry Perception” survey of Asia Pacific Petroleum Trading Companies conducted by Applied Training System, Indian Oil has BEEN ranked 2 nd amongst the 14 National Oil Companies. In the list of 800 largest non-US companies published by Forbes Magazine, Indian Oil is ranked 100 th by Revenue. Its main activities are manufacturing various petroleum products through refining of crude oil, marketing of petroleum products, transporting petroleum product and crude through its pipeline, research and development in the field of petroleum products etc.

GREEN REFINERY

CLEAN REFINERY

9

MATHURA REFINERY

Indian Oil owns and operates 7 of the country’s 14 refineries with a refining share of over 35.55% its eighth refinery I fine million tones per annum capacity at Pradeep in east India is under construction. Indian Oil has a 6,453 km network of pipeline comparable with that of any standard oil company in other parts of the world for economical, reliable and eco-friendly transportation of crude oil and petroleum products. Indian Oil meets 55% of the petroleum product consumption of India. It is also the canalizing agency for import of crude oil and major petroleum products. Its extensive network of over 20,000 sales points covers the entire country, and is backed for supplies by 184 terminals and depots, 43 LPG bottling plants and 92 aviation fuel stations. Indian Oil is the only company in the country with ISO9001/9002 accreditation for over 50 unit which include refineries, pipelines, aviation fuel stations, tube bottling plants and the Indian Oil were accredited with ISO 14001 certification for Environment Management Systems. Indian Oil’s comprehensive, ISO 9001 certified R&D center has done pioneering job in lubricates. refinery process and pipeline transportation. The center has developed over 1880 lubricants formulation and obtained approval from national and international equipment builders. A wholly owned subsidiary Indian Oil Blending Ltd. Manufactures over 450 grades of the country’s leading SERVO brand lubricants and greases.

Vision

A major, diversified, transnational, integrated energy company, with national leadership and a strong environment conscience, playing a national role in oil security and

public distribution.

10

GREEN REFINERY

Mission

CLEAN REFINERY

MATHURA REFINERY

1. To achieve international standard of excellence in all aspects of energy and

diversified business with focus on customer delight through value of products and services, and cost reduction.

  • 2. To maximize creation of wealth, value and satisfaction for the stakeholders.

  • 3. To attain leadership in developing, adopting and assimilating state-of the art technology for competitive advantage. To provide technology and services through sustained research and development.To foster a culture o participation and innovation for employee growth and contribution.

  • 4. To cultivate high standards of business ethic and total quality management for a strong corporate identity and brand equity.

OBJECTIVES

  • 1. To serve the national interests in the oil and related sectors in accordance and consistent with Government policies.

  • 2. To ensure and maintain continuous and supplies of petroleum products by way of crude refining, transportation and marketing activities and to provide appropriate assistance to the consumer conserve and use petroleum products efficiently.

  • 3. To earn a reasonable rate of interest on investment.

  • 4. To work towards the achievement of self-sufficiency in the field o foil refinery by setting up adequate capacity and to build up expertise in laying of crude oil/petroleum product pipelines

11

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINE

GREEN REFINERY CLEAN REFINERY MATHURA REFINE 12

12

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

INTRODUCTION ABOUT MATHURA REFINERY

13

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

INTRODUCTION ABOUT MATHURA REFINERY

Mathura Refinery, commissioned in 1982, presently operates @ 8.0 MMTPA crude processing level and is meeting the product demand of North -West region of the country including the National Capital Delhi.

The Refinery processes low sulphur crude from Bombay High, Nigeria, and high sulphur crude from Middle East Countries. The process configuration of the Refinery employs the state-of-the-art technologies with minimal impact on the environment. Various steps have been taken by Mathura Refinery to monitor and control the emission of Sulphur Dioxide. Mathura Refinery is the only refinery in the country to have set up the concern of community and archeological sites. These Ambient Air Monitoring Stations were commissioned before commissioning of the Refinery in 1981 and being continuously operated thereafter.

Mathura Refinery has taken many initiatives to produce more and more clean fuels in stages in the interest of environment, public health and preservation of national monuments around. Its noteworthy efforts are stage-wise implementation of various projects like Catalytic Reforming Unit, Diesel Hydrodesphurisation Unit and Hydro cracker for quality up gradation of automobile fuels. The Refinery has full-fledged ETP comprising of physical, chemical and biological treatment facilities. The treated effluent from the Refinery fully meets the MINAS (Minimal National Standards), the prescribes effluent discharge standards. For the protection of the land environment, Mathura Refinery has initiated biodegradation of oily sludge through "Oilivorous-S", an oily sludge degrading bacterial consortium developed by IOC (R&D) in collaboration with Tata Energy Research Institute. A beautiful ecological park has been developed in an area of 4.45 acres. During the recent survey, the experts from the BNHS (Bombay Natural History Society) have identified 96 species of birds of which 30 migratory ones in the park giving a testimony of richness of life in the ecosystem.

14

Mathura Refinery has done extensive tree plantation in and around Refinery. The Refinery ahs also taken extra-ordinary initiatives to provide green cover to the archeological heritage sites especially the Taj Mahal by planting 1, 15,000 trees in the Taj region. GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

STRUCTURE

Broadly Mathura Refinery apart from its Headquarter governed by following departments namely:

  • 1. Personnel and Administration Department

  • 2. Training Department

  • 3. Management Services Department

  • 4. Vigilance Department

  • 5. Finance Department

  • 6. Internal Audit Department

  • 7. Medical Department

  • 8. Materials Department

  • 9. Production Department

    • 10. Fire and Safety Department

    • 11. Power and Utilities Department

    • 12. Maintenance Department

    • 13. Process Project Department

    • 14. Technical service Department

15

GREEN REFINERY

CLEAN REFINERY

Personnel Department

MATHURA REFINERY

The primary function of the department are planning & organizing manpower requirement, estimating vacancies, recruitment to seek and attract qualified applicants to fill vacancies at lower level, organizational planning to determine the organizational structure, selection, staffing, internal transfers and promotions, recreation, communication, employee discipline, performance evaluation, medical services, grievance handling etc. The primary objectives of personnel department are to design and develop an organizational structure with well defined relationships commensurate with the business plans and corporate strategies, promote and develop cooperative attitude among employees for fostering harmonious relations and cultivate the sense of belonging, evolve progressive and pragmatic personnel policies, promote and inculcate the culture of employees’ participation in management, inculcate productivity consciousness among the

employees etc.

Training Department

The department is primarily responsible for fulfilling the low-level training needs of refinery employees and to develop the capability and proficiency of employees and their advancement through appropriate training and continuous knowledge updating to face corporate challenges and new technologies.

Management Services Department

The department is primarily responsible for fulfilling the data base requirement, EDP requirements, programming developing & maintenance.

16

Vigilance Department

The department is primarily responsible for running of the organization free of frauds, mistakes etc. in each department.

GREEN REFINERY

CLEAN REFINERY

Internal Audit Department

MATHURA REFINERY

The department is primarily responsible for routine check-up of general day-to-day working of the organization in order to have the organization free of frauds, mistakes etc. in each department.

Medical Department

The department is working under the personnel & administration department and is responsible for the medical awareness and medical requirements of the employees.

Materials Department

The department is primarily responsible for making an integrated approach to the improvement in Total Materials Management with active involvement of all concerned at the grass root level The main function of the department are planning material cycle by avoiding over stocking, locking up of capital, developing new sources of supply, maintain good suppliers relations, to procure desired quality material at the appropriate time and at reasonable prices, to maintain an effective inventory control system, to encourage progressive indigenous development of imported spares/equipment, to ensure prompt dealings with impartiality, integrity and courtesy towards vendors and suppliers, to promote ancillary and auxiliary industries, transportation, receipts, inspection, warehousing, preservation, issue, accounting, to help in physical verification and reconciliation of stores, economic disposal of surplus and scrap, inventory control including codification, standardization, variety reduction, value analysis, ABC analysis, FSN analysis etc.

17

GREEN REFINERY

CLEAN REFINERY

Production Department

MATHURA REFINERY

The primary function of the department is to receive the crude oil and refining it through distillation process in order to converting it into the finished product. Products which are being refined in the Mathura Refinery are Liquefied Petroleum Gas, Naphtha (Fertilizer use), Aviation Turbine Fuel, Superior Kerosene, Bitumen, Furnace Oil, Heavy Petroleum Stock, Light Diesel Oil, High Speed Diesel, Motor Spirit, Residual Fuel

Oil, Heavy Petroleum Stock, MS-93. Among the given products of Mathura Refinery, Sulphur is the by-product, which Refinery produces because of environmental factors. The main processing units are

1)

CDU (Crude Distillation Unit)

2)

VDU (Vacuums Distillation Unit)

3)

FCCU (Fluid Catalyst Cracking Unit)

4)

GCU (Gas Concentration Unit)

5)

VBU (Visbreker Unit)

6)

BTU (Bitumen Unit

7)

SRU (Sulphur Recovery Unit)

8)

ARU (Ammine Regircration Unit

9)

PRU (Poly Propylene Recovery Unit)

10) CRU (Catalytic Reformer Unit) 11) MSPF (Matching Secondary Process Facilities Unit)

12) DHDS (Diesel Hydro De Sulphurization Unit) 13) HGU (Hydrogen Generation Unit) 14) SRU (Sulphur Recovery Unit) 15) GT (Gas Turbine)-Phase 2 etc.

18

Fire and Safety Department

The department is primarily responsible for fire & safety arrangement and awareness in the organization in order to have the organization and its employee working in safety

environment. Its main function is to prevent and overcome the hazardous situations.

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

Power and Utilities Department

The department is primarily responsible for providing and maintaining the power supply and public utility works in refinery as well as in township.

Maintenance Department

Maintenance department has its three divisions namely:

Mechanical maintenance – responsible for mechanical maintenance work in the refinery.

Instrumentation maintenance – responsible for instrumental maintenance work in the refinery. Civil maintenance – responsible for civil maintenance work in the refinery.

Process Project Department

The department is primarily responsible for project work implementing in the refineries mainly of process units. Its main function is to procurement of material, plant

construction and its commissioning.

Technical service Department

The department is primarily responsible for technical aspects of the refineries mainly production and working of units.

MAJOR FEATURES

Mathura Refinery is the second biggest refinery in India with a capacity of 7.5 MT.

Its main products are Liquefied Petroleum Gas, Naphtha (Fertilizer use), Aviation Turbine Fuel, Superior Kerosene, Bitumen, Furnace Oil, Heavy Petroleum Stock,

19

Light Diesel Oil, High Speed Diesel, Motor Spirit, Residual Fuel Oil, Heavy Petroleum Stock, MS-93 etc. It is the major supplier for various petroleum products in Northern India.

It is a ISO 14001 and ISO 9001 certified unit of Indian Oil.

Its capacity utilization is more than hundred percent.

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

Phased dismantling of the Administered Price Mechanism (APM) is one of the strengths for the corporation as it gives the scope to the organization to compete in the coming competitive scenario. Mathura Refinery prepares annual budgets for rural development every year. IOC Mathura is just 56 Kms. away from Taj Mahal so it has to incur a lot of expenditure so as to ensure that the pollution is minimum. A pace setter among the Indian Refineries has become a model for synthesizing refining technology with environment. Power is supplied for the whole processing through Thermal Power Station (TPS) in which 2 of the 3 turbines are used at a time having a Thermal power. Capacity of 12.5 MW per turbine and total capacity of 3 turbines is 37.5 MW (Mega Watt). The Raw Material for refinery is basically Crude Oil from Bombay offshore and imported crude oil from Australia in the east and Nigeria and Venezuela. Products are dispatched from this refinery through Rail, Road and Mathura, Delhi, Ambala and Jalandhar pipeline. Refinery use of the two pipeline, Mathura Tudala,Matura Jalandhar

OBJECTIVES & CONTRIBUTION

The unit has contributed lot on the part of environment.

It has the objective of “Green Refinery Clean refinery”.

It is also the ISO 14001 certified unit.

FINANCIAL OBJECTIVES

20

1) To ensure adequate return on capital employed and maintain a reasonable annual dividend on its equity capital.

2)

To ensure maximum economy in expenditure.

3) To generate sufficient internal resources for financing partly/wholly expenditure on new

capital projects.

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

4) To develop long term corporate plans to provide adequate growth of the activities of the corporation.

5)

To continue to make an effort in bringing reduction in the cost of production of

petroleum products by means of systematic cost control measures. 6) The endeavor to complete all plan projects with in stipulated time and with in stipulated cost estimates.

FINANCIAL GOALS

1) To inculcate cost consciousness in user departments. 2) Development of Standard Refining costs at each unit level. 3) Proper implementation of budgetary control and submission of MIS in time. 4) To keep the level of inventories below the level fixed by the Board and outstanding debts, loans and advances and claims at bare minimum. 5) Ensure payment on due date to various agencies. 6) Monitor capital expenditure to ensure completion within stipulated time and cost. 7) Optimize utilization of working capital. 8) Efficient management of funds.

FUNCTIONS OF THE FINANCE DEPARTMENT

1)

Management of the financial resources for meeting the corporation’s programs of operations and capital expenditure including investment of surplus fund if any.

21

2) Ensuring uniform financial and accounting policies and procedures, to the extent possible, in the division. 3) Establish and maintain a system if financial scrutiny and internal checks and render advice on financial matters, including examining of feasibility studies and detailed project reports. 4) Establish and maintain an appropriate system of Budgetary Control and MIS (Management Information System) for different levels of the Management.

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

5)

Carry

out

periodical

/ special

studies

with

a

view

to

control

costs ,

reduce

expenditure , economy in administrative expenditure , improve efficiency to

maximize profitability of the corporation. 6) Maintain the financial accounts, cost accounts and other relevant books and records in accordance with the various statutory and other requirements.

7)

Advise on corporate cash planning, credit policy and pricing of the Corporation.

8)

Ensuring that the Corporation acts in all financial and accounting matters as per approved policies of the corporation within the framework of Government policy for public enterprises.

GUIDING PRINCIPLES FOR FINANCIAL CHECKS AND

ACCOUNTING

The Principles for financial checks and accounting to be followed by the Finance Department and by other departments shall among other things include the following:

1) That there is provision of funds for expenditure in accordance with the approved budget of the corporation or by re-appropriation under delegated powers. 2) That any expenditure is committed/incurred or any liability involving expenditure is created only after the proposed expenditure has been sanctionedby general or special approval of an authority to which the power has been duly delegated in this behalf. If the sanction is for a limited period , expenditure beyond that period should be admitted only after obtaining fresh sanction.

22

3) That all necessary pre – requisites before an expenditure is incurred such as preparation of estimates, calling of tenders, acceptance of tenders etc. are observed as per procedures. 4) That the authorities to who power has been delegated to incur expenditure shall be responsible for control of expenditure against the corresponding sanction. That the payments made for work done, supplies made or services rendered shall be as per legal obligations and in accordance with the agreements entered into by the corporation 5) ends shall be made to proper persons against acknowledgements so that a second claim against the corporation for the same transaction is ruled out.

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY 6) That proper books of accounts and records shall be maintained in accordance with the statutory requirements in respect of income and expenditure of the company and such income and expenditure shall be classified properly. 7) That all moneys due are regularly recovered and checked against demand and that moneys received are duly bought into the company’s books of accounts.

8)

That proper accounts of company’s property , assets , stores, spares etc. shall be

maintained and any loss or shortage of money or stores or other property caused by theft, pilferage, defalcation or otherwise shall be promptly brought to the notice of the concerned authorities. 9) That the property and assets of the company whether movable or immovable shall be periodically verified and reconciled with the books of accounts of the company to ensure that the books represent the correct position. 10) That the expenditure conforms to the general principles of financial propriety and is justified on the ground of economical viability or administrative prudence. 11) That the expenditure conforms to the relevant provisions of the Company’s Act , Memorandum of Association and the Articles of Association of the company. 12) That the directives issued from time to time by the company regarding financial scrutiny , internal check , economy in the expenditure or any other allied matters shall be fully adhered to.

13) All regulations , orders

or instructions which are of financial nature or having

financial implications shall be issued only after due scrutiny by the G.M ( Finance) at the Head Office or the Head of Finance at the units concerned.

23

14) Every employee who is entrusted with the physical custody of the cash , assets , materials , or other valuables belonging to the Corporation shall be responsible to render a proper account of such cash, assets, materials or other valuables as and when required to do so.

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

SECTION OF FINANCE DEPARTMENT

MISCELLANEOUS SECTION

While the important functions of the department have been dealt with separately in the earlier chapters, there are several miscellaneous jobs required to be carried out by the department. The miscellaneous jobs can be broadly divided into following categories: -

Accounting of cash imprested &advance for company;

Passing of bills of miscellaneous nature;

Miscellaneous recoveries from outsiders;

Inter –sectional coordination.

CASH SECTION

Cash section shall be responsible for:

Receipts of cash, cheques and bank drafts

 

Payment by cash, cheques, bank drafts.

Handling

of

bank

deposits/

withdrawals,

custody

of

cash

and transfer of funds

 

Security arrangement for cash handling

 

Safe custody of valuables & documents

Petty cash Impart

24

Maintenance of subsidiary cash credit account & special cash credit accounts Maintenance of cashbook and bank cashbooks.

PAYROLL SECTION

Appointments for vacancies are made either by recruitment or by departmental promotion or by deputation from Govt./other Department. Against leave vacancies officiating appointments are permitted in certain cases. All appointments are made in accordance with the rules prescribed Manual.

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

The matter relating to recruitment, promotion , transfer, suspension , are dealt with by the personal deptt. In each case office order is issued by the personal deptt. After observing the

prescribe procedure and given the fixation copies of these office orders are sent to the finance deptt for the drawing the pay & allowance incumbents.

Rules for pay and allowances are prescribed by Head Office from time to time. The eligibility for special types of allowances such as special allowances, shift allowance etc. is determined by Personnel Department and the intimations are sent to Finance Department for employees eligible for such allowances.

With a view to ensure easy identification each employee shall be allotted a Permanent employee number by the Office where the employee first joins. This number remains unaltered as long as the employee continues in service in the

With a view to ensure easy identification each employee shall be allotted a Permanent employee number by the Office where the employee first joins. This number remains unaltered as long as the employee continues in service in the Corporation. This number shall not be allotted to any other employee even if he/she leaves the Corporation. This permanent number is allotted from the block numbers allotted to various units as under:

25

The annual increments are drawn quarterly on April 1st, July 1st, October 1st and January 1st each year. The eligibility of an employee for annual increment with reference to a particular quarter of the year is determined as per rules in the Personnel Manual.

For all employees, annual increment is drawn automatically as and when it is due unless there is an intimation from the Personnel Department to the contrary. Under the present rules, the date of increment once fixed remains unchanged except for leave without pay in certain cases when increment is shifted to next quarter by the Office Order from Personnel Department.

Rules for various types of advances are prescribed in the Personnel/ Administration Manual. Applications for various advances are received by the Personnel/Administration Department through the department concerned. They examine the eligibility of each applicant as per rules and sanctions are forwarded to Finance. Based on the sanctions, payment is made by Finance and the recovery is affected in installments as per rules.

Payments relating to leave travel concession advance, lump sum payment in lieu of LTC facility, leave encashment etc., are made on the basis of advice received from Personnel Department in each case. The eligibility relating to the LTC Block and the number of tickets as well as leave

enchased shall be examined by the Personnel Department. The amount payable shall be determined by the Finance as per rules.

The authority for dealing with cases relating to termination of services, voluntary retirement resignation, retirement etc rests with the Personnel Department.Payment for retrenchment compensation, gratuity, terminal leave. actual period of work remaining unpaid etc. shall be made by Finance as per rules on receipt of advice and No Dues Certificate from the Personnel Deptt. Claims for T.A., medical expenses including post retirement medical facilities, conveyance reimbursement, Meal/Conveyance for additional and extended duties, etc. are settled by Finance in accordance with the rules and procedure prescribed from time to time in each case.

26

Various statutory returns such as returns under Factories Act, ESI Act, Provident Fund Act etc. are submitted by the Personnel Department. Monetary figures wherever necessary are provided by Finance.

FUNCTIONS

Function of the Section dealing with Establishment can be broadly classified as follows:

Scrutiny and concurrence of proposals from Personnel Department

Payment of Salaries and Allowances

Advances to employees

GREEN REFINERY

CLEAN REFINERY

Deductions from Pay Bills

Other Welfare Schemes including Gratuity

Personal Claims and other payments

Statutory and Statistical requirements

ACOCUNTING OF ASSETS

MATHURA REFINERY

For all items of fixed assets such as buildings, plant & machinery, furniture & fixtures etc. asset register shall be maintained by the Finance Department for complying the various accounting provisions under the Companies Act and the Income Tax Act.

Adequate depreciation on the cost of fixed assets shall be charged to the Profit & Loss Account before ascertaining the profit. The acquisition cost of assets should include all expenses for bringing the asset into existence. Such cost, therefore, includes purchase cost, erection cost, supervision cost etc. incurred up to the stage the asset is ready for commissioning

27

The Companies Act prescribes the minimum quantum of depreciation which should be charged to the profits of limited company before such profits are distributed as dividend, Keeping in view the statutory requirements and the effective life of the assets, the Board of Directors have prescribed the rates of depreciation for various categories of assets on straight line method.

The rates of depreciation admissible under the Income Tax Act are based on written-down value method and are different from the rates adopted by the Company, for its annual accounts. As such for compliance of the income tax requirements, details of depreciation at income tax rate are being maintained separately by Marketing Division, Bombay

In case any item of asset is discarded, sold or written off, the difference between the sale price of such asset and the written-down value shall be adjusted in the books of accounts as loss or gain.

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

Inter-unit and Inter-divisional transfer of movable assets shall be done through the stores Department. After issue of the asset item the issue voucher as usual shall be sent to Finance, who on the

basis of the identification number available in the issue voucher shall write the same in their asset ledger for future reference. Physical verification of all assets shall be undertaken at least~ once in every three years. The verification team shall start on the basis of the identification

FUNCTIONS

Following are the main functions in respect of accounting of assets:

i) Capitalization of the cost of acquisition of assets.

ii) Accounting of depreciation

iii) Transfers, disposal and discarding of assets

28

iv) Maintenance of Asset Ledger

v) Arrangement for physical verification of assets.

OIL ACCOUNTING

The Oil Movement and Storage Section in the Refinery is responsible for handling of receipt, storage and dispatch transactions for crude oil and oil products. The receipt transactions comprise crude oil supplies and finished products manufactured and/or procured from outside for blending, if any. Dispatch of finished products is based on the advice from the Marketing Division.

GREEN REFINERY

FUNCTIONS

CLEAN REFINERY

MATHURA REFINERY

— Accounting of Crude Oil receipts

— Accounting of Customs Duty on Crude Oil

— Accounting of finished products receipts

— Accounting of dispatch of products

— Excise procedure and accounting

Material balance and production statistics

PURCHASE FUNCTION

The transactions relating to procurement of materials from the indenting stage to the payment stage have been divided in various parts whereby each part of the work is handled

29

by an independent agency till the transaction is completely closed. This division of work between various agencies operates

Detailed procedure as prescribed in the Materials Management Manual is to be followed for all purchases. A general outline of the functions involved in the The authority to place indent for materials is subject to provisions in the approved budgets. Indents for materials on capital account are raised against capital/additional facilities budgets and on revenue account against purchase budget. Indents for project materials required for execution of works are to be

The necessity for purchase of the required materials is to be determined solely by the indenting department and approved by indent approving authority as provided in Materials Management Manual. The indents are to be raised for the right quantity and at the right time. The indenting departments are answerable for any stock outs or over-stocking of the materials.

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

The Purchases are to be made in accordance with the Tendering Procedure prescribed in the Materials Management Manual.

The objective of the Tendering Procedure is to ensure that right quality of materials are purchased from competitive sources and on best available terms and rates, keeping in view the delivery considerations. lt is also necessary to ensure that no undue advantage accrues to any particular supplier while finalizing a purchase contract.

After the tenders are invited by the Materials Deptt. the selection of suppliers and the placement of purchase order is done as per recommendations of the Tender committee with the concurrence of Finance Deptt.

The placement of purchase orders is to be approved by the competent authority in accordance with the financial limits prescribed as per delegation of powers.

30

FUNCTIONS

The Section dealing with the accounting of purchases is responsible for:

i)

Scrutiny and concurrence of purchase proposals;

ii)

Deposits and advance payments to suppliers:

iii)

Passing of bills for supplies received;

iv)

Pricing of Goods Receipt Notes;

v)

Accounting of cash purchases made by the Materials Department;

vi)

Arrangement for insurance of transit risk;

vii)

Maintenance of books of accounts;

viii)

Sales Tax matters.

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

INSURANCE

It is necessary to ensure that timely steps are taken to insure the properties of the Corporation like plant and machinery, inventories, cash etc. against various risks in accordance with the policy decisions taken by the Management from time to time.

All policies for general insurance are to be obtained from the subsidiaries of the General Insurance Corporation of India.

31

Insurance policies, as far as possible, should be obtained on an annual basis to coincide with the financial year of the company. When a policy is taken during mid of a year, the policy shall be extended up to next financial year closing, at the time of its renewal so that thereafter the renewal of the policy coincides with renewal of other insurance policies.

Timely action for renewal should be taken and renewal instructions should reach the insurers at least one week before the expiry of the policy so that the cover can be granted by the insurers before the expiry of the current period.

According to the Insurance Amendment Act, 1968 and the rules framed there under, premium for insurance should be paid in advance. If the premium is not paid in advance, the risk is not held covered and it results in the nullification of the insurance cover. GREEN

The Insurance Act, however, provides that the premium on insurance policy can be paid within 60 days of the start of the insurance policy cover provided a Bank Guarantee in the Performa given in the Act and Rules for an amount equivalent to the amount of Insurance premium is submitted to the Insurance Company before start of the risk coverage. All the units have been provided with adequate Bank Guarantee limits for issue of the bank guarantees in this behalf.

The Act also provides that no cover can be granted for a back dated period. As such proposals for insurance/renewals should be sent to the insurers well in time.

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

General insurance contract is a contract of indemnity, the purpose of which is only to indemnity any actual loss suffered by the insured. After the insurer agrees to indemnity the actual loss suffered by the insured? the insurer becomes entitled to all the rights and privileges which the insured is enjoying against third party for indemnification of losses. Indemnification of losses can not be claimed from the insurers as well as from the third parties.

Insurance is a contract of good faith. The law casts upon the insured as also the insurer the duty to disclose mutually every material fact within knowledge. There should be no mis- statement or omission of facts.

32

STORES SECTION

FUNCTIONS

The Section dealing with accounting of stores in the Finance Department shall have following functions:

  • i) Passing and accounting of transportation bills;

ii) Accounting of receipts, issues, return and transfer of materials;

iii) Accounting of imported materials for capital works and operations maintenance:

iv) Stock verification;

  • v) Accounting for sale of surplus materials.

GREEN REFINERY

AUDIT SECTION

TYPES OF AUDIT

CLEAN REFINERY

MATHURA REFINERY

There are five different types of audit in the Organization viz:

  • a) Statutory Audit;

  • b) Government Audit;

  • c) Internal Audit;

33

  • d) Technical Audit;

  • e) Tax Audit.

STATUTORY AUDIT

to The Statutory Auditors/Branch Auditors (Chartered Accountants) are appointed by the Company Law Board in consultation with the Comptroller and Auditor General of India u/s 619(2) of the Companies Act, 1956 for conducting the audit in accordance with the provisions of the Companies Act. The DFM, In charge of the Main Accounts Section shall coordinate the Audit work and supply of relevant information,/records/ documents as required by the auditors. With a view to finalize the annual accounts well within the prescribed time, it is necessary that all such information, documents are provided

expeditiously by the concerned Sections/Departments the Auditors.

GREEN REFINERY

CLEAN REFINERY

GOVERNMENT AUDIT

MATHURA REFINERY

Normally the Government audit conducts audit of the following three types:—

i) Routine/Phase Audit;

ii) Periodical review;

iii) Balance Sheet audit under Section 619(4) of the Companies Act.

34

INTERNAL AUDIT

The Internal Audit is functioning under the Director (Finance) through the GM(Internal Audit) at the Chairman's Office. The functions, duties, responsibilities and powers of Internal Audit Department have been detailed separately in the Internal Audit Manual.

Internal Audit shall examine independently the final accounts and attached Schedules to the Balance Sheet and Profit & Loss Account concurrently with finalization of annual accounts. Any point of observation shade by the Internal Audit, which the Head of Finance Department considers acceptable for modification of the accounts, may be accepted and changes be made in Accounts. However, comments by Internal Audit should be offered well before the finalization of the accounts at the Unit level.

TECHNICAL AUDIT

The Technical Audit Cell has been organized in each of the Units as well as at Head Office. This cell functions directly under the Head of Technical Services Department at Unit level and under the GM/DGM at Head Office

GREEN REFINERY

TAX AUDIT

CLEAN REFINERY

MATHURA REFINERY

Under Section 44 AB of the Income Tax Act, 1961, it is obligatory for every person carrying on business, if his total sales, turn over or gross receipts, as the case may be, exceed Rs. 40 lakhs in a year to get certain information/data relevant to Income Tax assessment audited before the specified date by the Tax Auditors (Clattered Accountants) and obtain report of the audit in prescribed form.

35

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

36

BUDGETING

GREEN REFINERY

CLEAN REFINERY

WHAT IS BUDGETING

MATHURA REFINERY

Budgeting is the current outlay of cash in the anticipation (estimate) of future benefit. The Budget is generally described as a detailed plan for a measured period, setting goals and outlining resources to meet those goals. In short, it provides details of the government's receipts and payments.

37

BUDGETARY PROCESS

The budgetary process in business operation can broadly be divided into

Four functions of management.

Communication

Planning

Co-ordination

Control

COMMUNICATION

It is the function of top management to inform people at lower level of management about the performance expected of them. Top management uses budgeting as vehicle to communicate goals and expectation to employees

PLANNING

The effectiveness of budgets depends greatly on the quality of the planning, which has preceded their framing. Not be realistic or useful. All members of management have to participate in the preparation of budgets even at the stage of planning, as it will evoke interest at all levels of management.

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

38

CO-ORDINATION

To ensure effective implementation of the budgets, it is necessary to have proper co- ordination. This is achieved by ensuring that budget plans are communicated to all level of management.

CONTROL

Budget actually covers not only expenditure but all the phases of

operations. The function

of control is to ensure that the performance strictly follows the plan envisaged and to

point out the variations between performance and plan as per budget.

REQUISITES OF GOOD BUDGETING

Budgeting is not a function to be performed by finance deptt. Alone. The planning and budgeting have to be grass root operation in which all levels of management participates. Finance deptt. Receives the operating plans of the line managers and other departmental head and transplant those plans into comprehensive projection of financial condition & operating results.

Budgets are means for setting standard of performance accepted from all levels of management. Maximum efforts should be made in framing correct estimate of all the factors involved so that budgets are prepared on a realistic basis.

It is necessary to review the budget procedures continuously.

It is necessary to fix standard of performance, which should be realistic in respect of various levels of operations. Efforts should be made to adhere to these standards & to improve upon.

39

GREEN REFINERY

CLEAN REFINERY

ADVANTAGES OF BUDGETING

MATHURA REFINERY

Budgeting ensures effective plans for the most economical use of the resources. It helps in effective implementation of the plans of the organization. It is based on estimate and the implementation of any programmed will depend to a large extent on the correctness of these basic estimates.

Forced planning

Coordinated operation

Performance evaluation and control

Effective communication

Optimum utilization of recourses

Productivity improvement

Profit-mindedness

Efficiency

40

LONG TERM BUDGET

Long-range plan covers a duration of 5 years. Long range planning is aimed to achieve the broad objectives envisaged in the perspective plan by fixing specific targets and actions plans for various functions. It is updated every year so as to have detailed plans for 5 years at any point of time. It is reviewed periodically with reference to actual performance.

SHORT TERM BUDGET

In addition, cash budget is prepared on monthly basis In the short term, the corporation prepares revenue & capital budgets indicating the revised estimates for the current year and budget estimate for the next year. These budgets are more detailed and indicate the expected physical/financial performance of operations and projects for close monitoring and control for fund management.

GREEN REFINERY

TYPES OF BUDGET

CLEAN REFINERY

Revenue budget

Capital budget

Programme \Activity Budget

Responsibility budget

Cash budget

Sales budget

41

MATHURA REFINERY

Production budget

Material budget

Purchasing budget

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

42

ZERO BASE BUDGETING

In the preparation of the budgets, the principle of zero base budgeting (ebb) is followed according to which each manager is required to justify his requirement after evaluation of various alternatives and ranking them in order of importance by systematic analysis.

Activity was taken up in the past. The connotation of any activity is required to be justified along with other competing claims.

Zbb concept shall be extended only to those areas where it is possible to control the expenditure. In case of salary & wages, for instance, zbb concept need not be applied. However, in case of over time, which is controllable, zbb concept shall be applied.

APPROVAL OF BUDGETS

Revenue & capital budgets shall be approved by board of directors. In case of revenue budget prior approval of the govt is required only in case the budgeted performance shows a deficit.

GREEN REFINERY

CLEAN REFINERY

43

MATHURA REFINERY

REVENUE BUDGET

GREEN REFINERY

CLEAN REFINERY

44

MATHURA REFINERY

REVENUE BUDGET

Revenue Budget is the usual starting point for budgeting because production and inventory level depends on the forecasted level of revenue. Consists of Revenue Receipts and Revenue Expenditure of the government The Revenue Budget is basically a budget of income and expenditure.

OBJECTIVE OF REVENUE BUDGET

To fix a target in respect of physical parameters viz.Throughput, product pattern, fuel and loss and also that of operating expenses which then become the basis for monitoring and control.

To estimate based on the targeted physical parameters/ operating expenses, the likely profit/ internal resource generation, which will then form the basis for funds management.

Components of Revenue Budget

The components of Revenue Budget are:

Throughput, Product pattern, Fuel & Loss

Operating income

Raw Material Cost

Operating expenses

Based on the above, the summarized position of Revenue Budget is prepared indicating the estimated profit/ loss during the budget period.

GREEN REFINERY

CLEAN REFINERY

45

MATHURA REFINERY

Throughput, Product Pattern and fuel and Loss

For the preparation of Revenue Budget, basic requirement is the estimation of likely throughput / product pattern for Refineries and estimated throughput of Pipelines. This estimation is done by inter-active process between Refinery units and Head Office taking into consideration the shut down schedules, crude oil availability and other technical consideration. Each Refinery indicates at the beginning of the year, the shut down schedules, on stream days available etc. to Head Office. Head Office interacts with OCC to ensure the availability of various products and intimates units the crude processing profile and the demand for different products. Based on this data, the Units work out the possible product pattern, which is again sent to HO for review and confirmation.

Operating Income

Transfer of Products :

Based on the projected throughput/ product pattern, the stocks in hand at the beginning of the year, and the anticipated stock at the end of the year the dispatches to Marketing Division shall be worked out. The same is to be valued at the existing

ex-refinery prices for formula products and transfer price for free trade products.

Pool Accounts Adjustments:

The Pool Accounts adjustments relating to products viz. Product pattern variation, ex-refinery – retention price differential, etc. shall be worked out as per existing instructions of OCC / Govt.

GREEN REFINERY

CLEAN REFINERY

46

MATHURA REFINERY

Raw Material Cost

Based on the types of crude to be processed as already determined, the raw material cost shall be worked out taking into consideration the prevailing cost of crude and the various Pool Accounts adjustment with regard to Crude Oil Price Equalization

Account (COPE), Cost and Freight Adjustment Account (C&F), etc.

Operating expenses

Controllable Cost

The operating costs are estimated based on Zero Base Budgeting (ZBB) concepts in respect of controllable items of expenditure. The following illustrative items are covered under ZBB:

  • - Chemicals & Catalysts

  • - Repairs & Maintenance

  • - Overtime

  • - Traveling & conveyance

  • - Communication expenses

  • - Printing & Stationery

  • - Staff Car expenses

GREEN REFINERY

CLEAN REFINERY

47

MATHURA REFINERY

Chemicals & Catalysts

The quantitative data should be based on the Technical parameters and separate decision package should be prepared in respect of each chemical / catalyst. In case of centrally procured chemicals, the rates will be advised by HO and in case of other chemicals, the rate has to be taken as per the latest prevailing prices with appropriate escalations. In all cases, the landed cost of chemicals at refinery / Pipeline location should be the basis for valuing the same.

Repairs & Maintenance

The decision packages for different jobs have been standardized and they are indicated in the forms. In order to ensure uniformity, these decision packages should be operated.

Overtime

The estimate of overtime should be based on the assessment of the overtime requirements in terms of hours. Generally overtime estimate is coordinated by MS Department of each Unit. The overtime is converted in terms of value by taking into account the prevailing wage rates with appropriate escalation factor.

Traveling & Conveyance

While estimating the requirements, care should be taken to included the increase in the number of employee. The latest reimbursement rates are to be taken into account while estimating the expenditure. In case of official tours, the estimate shall be based on the ZBB concept. It shall be ensured that the latest prevailing trains / airfare is considered while working out the projected expenses.

GREEN REFINERY

CLEAN REFINERY

48

MATHURA REFINERY

Communication Expenses

The increase in tariff for telephones / postage etc. should be taken into consideration while estimating the requirements. The additional facilities installed viz. Increase in number of telephone connections, telex facilities, introduction of courier service, etc.

should also be taken into account while estimating the requirements.

Printing & Stationery

The requirement on account of computer stationery, special printing jobs that may be undertaken during the year etc. are to be taken into consideration while estimating

the requirements.

Staff car expenses

The expenditure under this head would include amount spent on Company owned cars/ jeeps and buses. While estimating the requirements, the latest prevailing rates for petrol / diesel is to be taken into account.

NON-CONTROLLABLE COST

  • - Power & Fuel

  • - Establishment

  • - General Administration Expenses

  • - Depreciation The following points shall be taken care of at the time of estimation:

GREEN REFINERY

CLEAN REFINERY

49

MATHURA REFINERY

Establishment

Increase in manpower shall be identified with reference to specific projects and the impact of the same shall be considered while estimating the expenditure. Escalations for normal increments/ DA are to be provided as per advice from HO from time to time. Care shall be taken to project realistically the expenditure on welfare items like canteen/ medical based on the experience of the Unit.

General Administration Expenses

The trend of expenses should be analyzed based on the last two to three years to establish the normal rate of increase. In case of insurance, the estimate should be based on the actual amount of insurance as per the cover already taken and the likely increase in replacement cost. For future projections, the impact of new additions should also be taken into account.

Depreciation

Care should be taken to ensure that in case of assets reaching 95% of the original cost, no further depreciation is provided as per the Accounting Policy. In case of assets, which have to be commissioned during the years for which budgets are prepared, adequate depreciation should be provided for them.

It shall be ensured that the additions are in conformity with the completion schedule as indicated in the plan documents / AF Budget.

50

GREEN REFINERY

Review at Head Office

CLEAN REFINERY

MATHURA REFINERY

The budgets received from Refinery Units / Pipelines Head Office shall be reviewed by Finance of Head office R&P Division in association with other functional departments in Head Office. Wherever changes are advised by the other functions, the same shall be carried out. The budgets thus finalized shall be submitted to the Budget Committee at Head Office for consideration and approval. After, the approval, the detailed analysis for consolidation at corporate level and submission to Board of Directors.

Approval of Budgets

Chairman’s office after consolidating the budgets received from various Divisions will put up the same to the Board of Directors for approval. After the approval of the Board is received, the same shall be intimated to the Divisions. The budgets as finally approved by the Board will be the basis for comparison with the actual for monitoring and review. Based on the final approval, Head Office of Refineries & Pipelines Division shall forward the detailed budgets to the Refinery Units / Pipelines Head Office for

monitoring and review.

Revenue Budget Guideline

Crude oil and product prices-

Indigenous and imported crude oil prices and product prices to be considered for the purpose of budget.

Throughput and crude mix-

Throughput and crude mix are to be advice of technical deptt.

51

GREEN REFINERY

Entry tax-

CLEAN REFINERY

MATHURA REFINERY

Entry tax to the extent of production of four major products( LPG, MS, SKO,and HSD) to be shown separately .

Natural Gas-

The details of natural gas consumption (Qty, Rate and Value) should be shown separately.

Operating Cost-

Units should provide details of extraordinary activities along with operating cost details and steps taken for cost control/ reductions. As per instructions from corporate office, operating cost is allowed to the extent of

actualOf 2006-07 or 2007-08whichever is Higher.

In a view of that the details of one time expenditure & new item expenditure on new projects to be shown separately along withFor all the years. A separate note on cost control measures along with steps taken & proposed to be taken to keep the cost at the levels of actual 2006-07 or 2007-08 , whichever is Higher, may be enclosed .

Chemical, Catalyst & Consumables -

Details of actual consumption, quantity, rate for the year 2006-07 along with the projections for RE 2006-07 & 2007-08may be sent reasons for variation in quantity may be given. Norms considered for chemical consumption to be enclosed. One time chemicals to be reported separately.

Repairs and Maintenance -

The

summary of the expenditure department – wise/cost center wise is required to be

furnished

to

enable

the

maintenance

department

of HQ

to

review

the

same

before

finalization

.The same

may

be

sent in

advance so that

it may

be reviewed by M&I

department.

52

GREEN REFINERY

Overtime-

CLEAN REFINERY

MATHURA REFINERY

A summary of department wise overtime hours & overtime amounts should be furnished along with reasons for variation.

Traveling& Convenience , Printing And Stationary And Communication Expenses -

Reconciliation of this expenses may be furnished . communication expenditure to be based on the latest tariff in view of reduction in rates.

.

Other Overheads-

Overheads may be considered keeping in mind cost control drive . expenses on technical

fees , community development separately.

and enlistment of SC/ST may be assessed and highlighted

Depreciation-

Depreciation shall be provided at existing rates on pro-rata bases taking into consideration likely addition during the year. The details of air pollution control equipment, water pollution control equipment and energy saving devices which carry 100% dep. Under rule 5 of the Income Tax Act 1962 may be shown separately.

Environment And Pollution Control -

Actual expenditure and amount provided in RE 2006-07 and BE 2007-08 for environmental up-gradation and environmental protection and pollution control may be given

53

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

Research methodology

54

GREEN REFINERY

Research methodology

CLEAN REFINERY

MATHURA REFINERY

1.SAMPLE SIZE: During the sample survey reports of my project we asked the question to hundred peoples who are employed in Mathura Refinery.

2.SAMPLE AREA: During the survey report we cover all the departments in Mathura Refinery.

METHOD OF DATA COLLECTION

1. PRIMARY DATA:- Primary data were collected by the method of distribution questionnaire to the Finance department of Mathura refinery and analyzing and evaluating feedback from. 2. SOURCES OF SECONDARY DATA:- secondary data were collected by following sources Text books Internet & Websites Annual General report

55

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

ANALYSIS

AND

INTERPRETATION

56

GREEN REFINERY

CLEAN REFINERY

ANALYSIS AND INTERPRETATION

CURRENT RATIO = CURRENT ASSET CURRENT LIABILITIES

=1.7 (IN 2008) =1.5 (IN 2007)

MATHURA REFINERY

INTERPRETATION:- Relatively high current ratio is an indication that the firm is liquid and has the ability to pay its current obligations in the time us and when they become due and low current ratio represents that the liquidity position of the firms is not good and firms shall not be able to pay its currents liabilities in the time without facing difficulties.

DEBT EQUIT RATIO = BOAROD FUND OWNER FUND

=0.6(IN 2008) =1.35(IN 2007 INTERPRETATION:-its indicate the margin of safety to long term creditors. A low debt equity ratio implies the use of more equity than debt which means a larger safety margin for creditors since owners equity is treated as a margin of safety by creditors and vice versa.

EQUITY RATIO = PROPRIETORS TOTAL ASSETS

=0.6 (IN 2008) =1.35 (IN 2007

INTERPRETATION: An equity ratio represents the relationship of owners funds to total assets, the higher ratio or the share in total capital of company, better is the long tern solvency position of company.

57

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

STOCK TURN OVER RATIO = NET SALE AVERGE INVENTORY

=26.81 (IN 2008) =18.96 (IN 2008) INTERPRETATION: If too high ratio may be the result of a very low inventory levels and too high low ratio may be result of excessive inventory level. show making incurred the high carrying cost.

FIXED ASSETS OVER RATIO = NET SALE AVERGE FIXED ASSETS

=18.86 (IN2008) =17.80 (IN2007 INTERPRETATION: It indicates the firm’s ability to generate sale per rupees of investment in fixed assets .higher the ratio is the more efficient the management and utilization of fixed assets.

NET PROFIT RATIO = NET PROFIT * 100 NET SALE

=13.72% (IN 2008) =6.90% (IN 2007)

INTERPRETATION:

Average net margin earned an the sale of Rs100

What portion of sale is left to pay dividend and to create the reserve and higher the ratio is the greater the capacity.

58

GREEN REFINERY

LIMITATIONS

CLEAN REFINERY

MATHURA REFINERY

There were a lot of problems at the time of project reports.

  • 1. Shortage of time

  • 2. Shortage of money

  • 3. Wrong answers

  • 4. Improper data

  • 5. During Training time most of the staff on leave.

59

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

FINDING

AND

CONCLUSION

60

GREEN REFINERY

FINDINGS

CLEAN REFINERY

MATHURA REFINERY

1.In the broad sense training is necessary to make the students of professional institution familiar with industrial environment This regard we gain knowledge about the topic of Revenue Budget ..

2.Revenue Budget basically it is the benefit of the company because this is based on the income and expenditure of the company.

CONCLUSION

Mathura Refinery was commissioned in 1982. First Lady P.M. Mrs. Indris Gandhi laid the foundation. It is the second largest refinery in India with the capacity of 7.5 MMTPA. The refinery mainly produces middle distillates and supplies them to Northern India through a product pipeline to Jalandhar, Punjab via Delhi.

From the data interpretation Result we can conclude that, the Revenue Budget of this year higher than the previous year it means total expenditure is less than income.Compaire of the to year Balance sheet data throught different Financial ratio such as Debt Ratio, Turn over ratio, Net profit ratio, Equity ratio, Fixed assets ratio,etc.

61

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

GRAPHS

62

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

PLANT&MACHINARY

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY PLANT&MACHINARY ELECTRICITY&WATER COMMUNICATION 63

ELECTRICITY&WATER

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY PLANT&MACHINARY ELECTRICITY&WATER COMMUNICATION 63

COMMUNICATION

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY PLANT&MACHINARY ELECTRICITY&WATER COMMUNICATION 63

63

GREEN REFINERY

BANK CHARGE

CLEAN REFINERY

MATHURA REFINERY

GREEN REFINERY BANK CHARGE CLEAN REFINERY MATHURA REFINERY OVERETIME TRAVELLING AND CONVEYANCE 64

OVERETIME

GREEN REFINERY BANK CHARGE CLEAN REFINERY MATHURA REFINERY OVERETIME TRAVELLING AND CONVEYANCE 64

TRAVELLING AND CONVEYANCE

64
64

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

EXURE

65

ANN

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

MATHURA REFINERY PROFIT & LOSS ACCOUNT

PARTICULARS 2008 2007
PARTICULARS
2008
2007

66

INCOME 1.TRANSFER OF PRODUCTS TO MRKT. DIVISION EX-REFINERY PRICE

 

261,262,522,60

263,369,804,298

9

TW/TL/PIPELINES INCLUDING EXCISE DUTIES ON TOP LESS; EXCISE DUTY ON TOP TO MRKT.DIVISION

48,492,932,526

42,958,302,306

SALES(NET)

218,304,220,30

214,876,871,772

3

2.INCREASE/DECREASE IN STOCK

153,290,954

3.THER INCOME

194,759,206

4.INTEREST FROM MARKETING DIVISION

3,218,783,096

0

5.INTEREST FROM A.O.D.

1,031,100,166

0

5.SERVICE CHARGE FROM

0

MKTG.DIVISION

0

69,583,828

6.SERVICES CHARGE FROM PIPELINES

4,920,000

7.TRANSFER OF ELECTRICITY TO

70,837,852

28,564,951

PIPELINE

5,930,060

31,423,487

TOTAL INCOME

215,327,990,711

EXPENDITURE

222,662,294,96

4

1.MANUFACTURING,ADMN.SELLING AND OTHER EXPENCES

199,901,168,070

0

LESS; CO.USE OF OWN OIL NET

199,901,168,070

191,381,790,77

2.TRANSFER OF FINISHED PRODUCTS

2

0

FROM MARKETING DIVISION

0

3.INTER UNIT TRANSFER IF PRODUCTS

191,381,790,77

-2,624,433,026

4.EXCISE DUTY

2

48,821,666,670

LESS;EXCISE DUTY ON TOP TO MKT.

48,492,932,526

DIVISION

0

NET

328,734,144

5.DEPRECIATION AMORTISATION

-1,580,973,093

1,866,335,467

6.INTEREST ON LOAN

43,168,810,598

A.OCC/OIDB LOAN

42,958,302,306

712,009,123

B.GOVT.LOAN

0

C.BANKS

210,508,292

0

D.FOREIGN BANK CREDIT

1,825,472,273

43,034,338

E.OTHERS

264,266

TOTAL

517,446,331

755,307,727

0

0

38,325,662

58,579,117

67

   

614,351,110,

 

MATHURA REFINERY PROFIT & LOSS ACCOUNT

PARTICULARS 2008 2007
PARTICULARS
2008
2007

68

69

69

7.SERVICE CHARGE PAID TO BO

 

17,360,787

17,003,566

8.COMMITMENT CHARGE

0

0

9.EXPENDITURE PAID TO OTHER DIVISION

0

0

10.HO EXPENSES ALLOCATION

248,098,000

2189,129,000

TOTAL EXPENDITURE

192,716,608,141

200,462,244,498

11.PROFIT FOR THE YEAR BEFORE TAX

29,945,686,823

14,865,745,763

12.INCOME RELATING TO PREVIOUS

8,243,968

-25,143,280

YEAR(NET) 13.PROFIT BEFORE TAX

29,953,930,791

14,840,602,483

14.BALANCE BROUGHT FORWARD FROM YEAR ACCOUNT

14,840,602,483

20,074,905,627

14,840,602,483

20,074,905,627

15.LESS:TRANSFERRED TO REGUSTERED OFFICE 16.BALANCE CARRIED TO BALANCE SHEET

29,953,930,791

14,840,602,483

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

MATHURA REFINERY BALANCE SHEET

70

PARTICULARS

 

2008

2007

 
         

71

SOURCES OF FUNDS

     

1.SHARE CAPITAL

0

0

2.RESERVES&SURPLUS

29,953,930,791

14,840,602,,483

3.TOTAL SHAREHOLDER FUND

29,953,930,791

14,840,602,483

4.LOANS

A-SECURED

24,004,484

45,586205

B-UNSECURED

0

0

5.TOTAL FUNDS EMPLOYED

29,977,935,275

14,886,188,688

6.HO/A/C/BRANCHA/C(CONTRAS)

5,818,228,402

18,197,566,293

TOTAL

35,796,163,677

33,083,754,981

APPLICATION OF FUNDS

1.FIXED ASSETS

  • a. GROSS BLOCK

37,219,011,822

36,969,069,348

b.LESS DEPRECIATION

14,657,310,790

12,899,777,315

c.NET BLOCK

22,561,701,032

24,069,292,033

d.DISMANTLED CAPITAL STORES

8,872,109

8,729,200

e.CAPITAL WORK IN PROGRESS

567,180,637

447,891,590

TOTAL-1

23,137,753,778

24,525,912,823

2.INTANGIBLE ASSETS a. GROSS CARRYING AMOUNT

209,201,139

209,201,139

b.LESS:ACCUMULATED AMORTISATION

71,295,941

44,816,314

  • c. LESS:ACCUMULATED IMPAIRMENT LOSS

0

0

d.NET CARRYING AMOUNT

137,905,198

164,384,825

GREEN REFINERY CLEAN REFINERY MATHURA REFINERY

MATHURA REFINERY BALANCE SHEET

PARTICULARS 2008 2007
PARTICULARS
2008
2007

72

73

73

3.INVESTMENTS

     

4.CURRENT ASSETS,

2,000

2,000

LOANS&ADVANCES A.CURRENT ASSETS a. INVENTORIES b.SUNDRY DEBTORS

16,281,256,739

11,328,059,102

c.CASH&BANK BALANCE

0

0

B.LOANS&ADVANCED

112,919

2,625,744

17,611,784,476

18,434,453,083

TOTAL-4

33,893,154,134

29,765,137,929

5.LESS: CURRENT LIABILITIES &PROVISION a)CURRENT LIABILITIES

19,998,051,505

2,005,1712,590

b)PROVISION

0

0

6.NET CURRENT ASSETS(4-5)

8.INTER DIV/UNIT BALANCES

13,895,102,629

9,713,425,339

7.MISCELLANEOUS EXPENDITURE DEFERRED REVENUE EXPENDITURE 1.VOLUNTARY RETIREMENT COMPENSATION AS PER LAST A/C

0

7,871,469

ADD: EXPENDITURE INCURRED DURING THE YEAR

3,945,924

2,421,874

LESS:AMORTISED DURING THE YEAR

3,945,924

10,293,343

a. MARKETING DIVISION

-1,451,240,078

-1,361,326,334

b.PIPLINES

76,640,150

41,356,328

c.A.O.D.

0

0

d.R&D CENTRE

0

0

TOTAL

35,796,163,677

33,083,754,981

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

74

GLOSSARY

75

GREEN REFINERY

CLEAN REFINERY

GLOSSARY

  • 1. AL – Authority Letter

  • 2. CFM –Chief Finance Manager

  • 3. CHO – Central Head Office

MATHURA

REFINERY

  • 4. DGTD – Director Of Trade and Distribution

  • 5. DOP – Delegation Of Power

  • 6. ED – Executive Director

  • 7. EMD – Earnest Money Deposit

  • 8. GRN – Goods Received Note

  • 9. GM – General Manager

    • 10. HOD – Head of the Department

    • 11. IOCL – Indian Oil Corporation Limited

    • 12. ISD – Initial security credit

    • 13. LSC – Letter Short Credit

    • 14. MR – Mathura Refinery

    • 15. MB – Measurement Book

    • 16. MIV – Material Issue Voucher

    • 17. MRV – Material Receipt Voucher

    • 18. POS – Preliminary Observation Slip

    • 19. PRE-MAC – Management Audit Committee

    • 20. QRIP – Quarterly Report on Important Point

    • 21. ROP – Re Order Point

    • 22. RA – Running Account

    • 23. SAF – Significant Audit Findings

    • 24. ZBB – Zero Base Budgeting

    • 25. MS- Motor Spirits

    • 26. FO-Furnace oil

    • 27. RFO-Residual Furnaces oil

    • 28. HSD-High speed diesel

    • 29. SKO-Superior Kerosene oil

    • 30. RN-Naphtha

76

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

REFERENCES

77

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

REFERENCES

INTRODUCTION ABOUT IOCL

WWW.IOCL.COM

FINANCIAL & OPERATIONAL PERFORMANCE

DARPAN (Magazine of IOCL)

ACCOUNT MANNUAL OF IOCL

WORK PROCEDURE MANNUAL OF IOCL

FINANCIAL MANAGEMENT

I M PANDEY & KHAN AND JAIN

78

GREEN REFINERY

CLEAN REFINERY

MATHURA REFINERY

79