a study on financial analysis of tri van drum airport
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ContactK.Vijayakumar - 9944711825TRANSCRIPT
A STUDY ON FINANCIAL ANALYSISOF
TRIVANDRUM INTERNATIONAL AIRPORTABSTRACT
The project titled “A study on financial analysis of Trivandrum International
Airport” has been undertaken at the Trivandrum International Airport over a
period of 4 months.
The primary objective of the study is to analyze and evaluate the various
financial statements of Trivandrum Airport.
Mainly secondary data obtained from financial statements, books of
accounts and journals have been used for the study.
Tools like ratio analysis, comparative income statement and DU PONT
control chart have been used for the study.
The data in the study is summarized by using tables and various charts.
1
ACKNOWLEDGEMENT
At the onset, I thank the almighty of blessing me and guiding me to
complete the project within the stipulated time.
I am extremely obliged to the Finance Department of TRIVANDRUM
INTERNATIONAL AIRPORT for sparing their valuable time and providing with
best facilities and the right atmosphere for the completion of the project.
I also take the opportunity to express my sincere thanks and gratitude to
the Principal Dr. P.S.S.SRINIVASAN, the Director Prof. K. PRABAKAR and the
faculty guide Dr.K.Balanaga Gurunathan of K.S.Rangasamy College of
Technology, Tiruchengode for their excellent encouragement and support
throughout the course of this project.
I take the opportunity to thank profusely Mr. Saji Sam Accounts Manager
Trivandrum International Airport, for his excellent guidance and needful
discussions without which this project would not have been successful.
Last but not least, a bouquet of love and gratitude to my parents for
showering me with the moral support and love when ever I needed. My sincere
thanks to my friends on whom I can turn on for anything and who had been a
pillar of strength and support throughout the completion of this work. I wish to
thank all others who had encouraged me directly or indirectly for the successful
completion of this project.
2
TABLE OF CONTENTS
Particulars Page No.
CHAPTER – 1
1.1 Introduction 1
1.2 Statement of the problem 3
1.3 Objectives of the study 4
1.4 Scope of the study 5
1.5 Limitations of the study 6
1.6 Chapterization of the study 7
CHAPTER – 2
2.1 Concepts of the study 8
2.2 Review of related literature 14
2.3 Industry profile 15
2.4 Company profile 21
CHARTER – 3
3.1 Research Methedology 24
3.2 Data collection details 24
3.3 Tools of the study 25
CHAPTER – 4
4.1 Analysis of the data 26
CHAPTER – 5
5.1 Findings of the study 59
5.2 Suggestions 60
5.3 Conclusion 61
APPENDICES
BIBLIOGRAPHY
3
LIST OF TABLES
4
S.No TITLEPAGE
No
4.1 TABLE SHOWING FIXED ASSET
TURNOVER RATIO26
4.2 TABLE SHOWING CURRENT RATIO 28
4.3 TABLE SHOWING REVENUE STAFF
COST RATIO30
4.4 TABLE SHOWING OPERATING COST
RATIO32
4.5 TABLE SHOWING REVENUE SECURITY
EXPENSES RATIO34
4.6 TABLE SHOWING DEPRECIATION COST
RATIO36
4.7 TABLE SHOWING ADMINISTRATIVE
COST RATIO38
4.8 TABLE SHOWING NET PROFIT RATIO 40
4.9 TABLE SHOWING WORKING CAPITAL
TURNOVER RATIO42
4.10 TABLE SHOWING DEBTORS TURNOVER
RATIO44
4.11 TABLE SHOWING COMPARATIVE
INCOME AND EXPENDITURE
STATEMENT FOR THE YEAR 2002-03
AND 2003-04
46
4.12 TABLE SHOWING COMPARATIVE
INCOME AND EXPENDITURE
STATEMENT FOR THE YEAR 2003-04
AND 2004-05
48
4.13 TABLE SHOWING COMPARATIVE
INCOME AND EXPENDITURE
STATEMENT FOR THE YEAR 2004-05
AND 2005-06
50
4.14 TABLE SHOWING COMPARATIVE
INCOME AND EXPENDITURE
STATEMENT FOR THE YEAR 2006-07
52
4.15 DU PONT CONTROL TABLE FOR THE
YEAR 2002-0353
4.16 DU PONT CONTROL TABLE FOR THE
YEAR 2003-0455
4.17 DU PONT CONTROL TABLE FOR THE 57
5
DU PONT CONTROL TABLE FOR THE YEAR 2006-07
LIST OF CHARTS
S.No TITLEPAGE
No
4.1.1 CHART SHOWING FIXED ASSET TURNOVER
RATIO27
4.2.2 CHART SHOWING CURRENT RATIO 29
4.3.3 CHART SHOWING REVENUE STAFF COST
RATIO31
4.4.4 CHART SHOWING OPERATING COST RATIO 33
6
4.5.5 CHART SHOWING REVENUE SECURITY
EXPENSES RATIO35
4.6.6 CHART SHOWING DEPRECIATION COST
RATIO37
4.7.7 CHART SHOWING ADMINISTRATIVE COST
RATIO39
4.8.8 CHART SHOWING NET PROFIT RATIO 41
4.9.9 CHART SHOWING WORKING CAPITAL
TURNOVER RATIO43
4.10.10 CHART SHOWING DEBTORS TURNOVER
RATIO45
4.15.11 DU PONT CONTROL CHART FOR THE YEAR
2002-0354
4.16.12 DU PONT CONTROL CHART FOR THE YEAR
2003-04
56
4.17.13 DU PONT CONTROL CHART FOR THE YEAR
2004-0558
4.18.14 DU PONT CONTROL CHART FOR THE YEAR
2005-0660
4.19.15 DU PONT CONTROL CHART FOR THE YEAR
2006-0762
7
INTRODUCTION
Financial statement is an organized collection of data according to logical
and consistent accounting procedures. Its purpose is to convey an understanding
of some financial aspects of a business firm. It may show a position at a moment
of time as in the case of a balance sheet, or may reveal a series of activities over
a given period of time, as in the case of an income statement.
Thus the term ‘financial statements’ generally refer to two basic
statements:
1. The income statement, and
2. Balance sheet
Of course, a business may also prepare
3. A statement of retained earnings
8
4. A statement of changes in financial position
Financial analysis is the process of identifying the financial strengths and
weaknesses of the firm by properly establishing relationships between the items
of the balance sheet and the profit and loss account. Financial analysis can be
undertaken by management of the firm, or by parties outside the firm, viz.
owners, creditors, investors and others. The nature of analysis will differ
depending on the purpose of the analyst.
1. Trade creditors are interested in the firm’s ability to meet their
claims over a short period of time. Their analysis will, therefore, confine
to the evaluation of the firm’s liquidity position.
2. Suppliers of long-time debt, on the other hand, are concerned
with the firm’s long-term solvency and survival. They analyze the firm’s
profitability over time, its ability to generate cash to be able to pay
interest and repay principal and the relationship between various
sources of funds.
FinancialStatements
IncomeStatement
Statement of changes in
financial position
Balance sheet
9
Statement of retained earnings
3. Investors, who have invested their money in the firm’s shares, are
most concerned about the firm’s earnings. They restore more
confidence in those firms that show steady growth in earnings.
4. Management of the firm would be interested in every aspect of the
financial analysis. It is their overall responsibility to see that the
resources of the firm are used most effectively and efficiently, and that
the firm’s financial condition is sound.
STATEMENT OF THE PROBLEM
In the present scenario of ‘modern techniques’ in compilation of various
financial statements, new systems and trends are being adopted by several
companies to present their financial status and results before the share-holders
year after year.
As a finance student it always helps to practically study and analyze the
financial statements of a company to have a thorough understanding as to how
such accounting statements are derived out of the various books of accounts
maintained by the company. It is also important to study the necessity of various
management information reports prepared by the company in addition to the
usual reports like trial balance, balance sheet etc. and the role played by such
statements in future economic planning of the company.
In this context it is felt appropriate to know as to how an upcoming aviation
industry like Airports Authority of India is preparing their financial statements with
10
a particular reference to Trivandrum Airport and analyze the same with several
accounting tools like percentage analysis, ratio analysis.
The financial statement analysis includes ratio analysis, comparative
statements, common size statements, cash flow, fund flow etc.
OBJECTIVES OF THE STUDY
The objective of the report is to study the various financial statements of
the AAI and to have a clear idea about the various financial strengths and
weaknesses of the organization.
1. To study and analyze the various sources of its Cash Inflows of
Trivandrum Airport
2. To study and analyze the Cash Inflows of Trivandrum Airport
3. To make a comparative analysis of income and expenditure of
Trivandrum Airport for the financial year starting from 2002-03 to 2006-
07
4. To study and evaluate the various financial statements of Trivandrum
Airport and finding the different ratio analysis
11
5. To Analyze the ratio analysis and interpretation of the same to find out
the company’s long term solvency
6. To make suggestion for further improvements based on the above
analysis
SCOPE OF THE STUDY
The recent spurt in the aviation industry, through out the world has
brought un-imaginable economic growth and India is one of the leading
developing countries to share such growth. As such the Civil Aviation Industry is
presently a happening industry in the country in view of its all-round financial
growth and Airports Authority of India, which is one of the premiere organizations
in Civil Aviation, is felt to be apt for this project work and as sample case study
Trivandrum International Airport has been selected.
It is necessary for a student of Master in Finance to understand the
financial position of an organization like Trivandrum Airport, to know its various
sources of income, to know how the money is spent, how its trial balances and
other relevant financial statements are compiled, how the surplus/deficit is
worked out before the statements are forwarded to its Corporate office in New
Delhi and such study helps to compare theory with practical one
12
LIMITATIONS
Trivandrum International Airport is one of the many airport units of Airports
Authority of India. As such most of the Financial Statements are not compiled at
local level. For example the Balance Sheet of AAI is compiled only at their
Corporate Head quarters by consolidating the data in respect of all the airports in
India. Only the Trial Balance is prepared at Trivandrum. The analysis was made
only on the basis of statements available at local level.
The time constraint was yet another limitation to study all the financial
aspects of the Trivandrum airport and also since airport functions from both
Domestic and International terminals, high level of security measures are
adopted for the entry to some areas of the airport.
13
CONCEPTS OF THE STUDY
Financial statement analysis
The term ‘Financial Statement Analysis” has the following detailed
explanation:-
Financial statement analysis is the process of examining relationships
among financial statement elements and making comparisons with relevant
information. It is a valuable tool used by investors and creditors, financial
analysts, and others in their decision-making processes related to stocks, bonds,
and other financial instruments. The goal in analyzing financial statements is to
assess past performance and current financial position and to make predictions
about the future performance of a company. Investors who buy stock are
primarily interested in a company's profitability and their prospects for earning a
14
return on their investment by receiving dividends and/or increasing the market
value of their stock holdings. Creditors and investors who buy debt securities,
such as bonds, are more interested in liquidity and solvency: the company's
short-and long-run ability to pay its debts. Financial analysts, who frequently
specialize in following certain industries, routinely assess the profitability,
liquidity, and solvency of companies in order to make recommendations about
the purchase or sale of securities, such as stocks and bonds.
Analysts can obtain useful information by comparing a company's most
recent financial statements with its results in previous years and with the results
of other companies in the same industry. Three primary types of financial
statement analysis are there. They are commonly known as horizontal analysis,
vertical analysis, and ratio analysis.
They are method used by interested parties such as investors, creditors,
and management to evaluate the past, current, and projected conditions and
performance of the firm. Ratio analysis is the most common form of financial
analysis. It provides relative measures of the firm's conditions and performance.
Horizontal Analysis and Vertical Analysis are also popular forms.
Horizontal analysis is used to evaluate the trend in the accounts over the years,
while vertical analysis, also called a Common Size Financial Statement discloses
the internal structure of the firm. It indicates the existing relationship between
sales and each income statement account. It shows the mix of assets that
produce income and the mix of the sources of capital, whether by current or long-
term debt or by equity funding
After completing the financial statement analysis, the firm's financial
analyst will consult with management to discuss plans and prospects, any
problem areas identified in the analysis, and possible solutions.
15
In this project work, the relevance of Financial Statement Analysis in
respect of Trivandrum Airport are proposed to be analyzed with the available
data and information about the income and expenditure of Trivandrum Airport so
that the various Ratio Analysis can be arrived at.
The following is the flow chart of various Ratio Analysis being worked-out
at Trivandrum Airport, to find out the company’s performances during every
financial year.
16
CLASSIFICATION OF RATIOS USED BY TRIVANDRUM AIRPORT
FLOW CHART OF RATIOS
LIQUIDITY RATIOS
ACTIVITY RATIOS
PROFITABILITY RATIOS
I. Out of the Liquidity Ratios Category, Trivandrum Airport uses the following specific ratios
LIQUIDITY RATIOS
CURRENT RATIO
II. Out of the Activity Ratios Category, Trivandrum Airport uses the following specific ratios
ACTIVITY RATIOS
FIXED ASSET TURNOVER RATIO
WORKING CAPITAL TURNOVER RATIO
SUNDRY DEBTORS TURNOVER RATIO
III. Out of the Profitability Ratios Category, Trivandrum Airport uses the following specific ratios
PROFITABILITY RATIOS
17
NET PROFIT/LOSS RATIO
STAFF COST RATIO
OPERATING COST RATIO
ADMINSITRATIVE EXPENSES RATIO
SECURITY EXPENSES RATIO
DEPRECIATION COST RATIO
RATIO ANALYSIS
The importance of ratio analysis has widely recognized on account of its
usefulness in different ways. Ratios convey the inter relationship between
different accounting items. Hence they are more helpful than absolute figures
shown in the financial statements. The absolute figures, shown in the financial
statements are neither significant nor able to be compared. In fact they are
dump. But ratios have power to speak.
The following are the importance of Ratio Analysis :-
It helps to measure the General Efficiency of the Organisation
It guides the top management in forecasting and planning
18
It indicates the Financial Solvency of the Company
It facilitates the Finance/Marketing managers in decision making
It helps to take corrective action
It aids in making the intra-firm comparisons
It plays the role of good communicator
Ratios are very useful in cost control
COMPARATIVE STATEMENTS
Comparative statements are statements of financial position at different
periods of time. The element of financial position is shown in a comparative form
so as to give an idea of financial position at two or more periods. Comparative
statement is an important device of horizontal financial analysis. It can be
prepared for both types of financial statements – Profit and Loss Account and
Revenue and Expenditure Account.
DU PONT CONTROL CHART
Return on investment (ROI) represents the earning power of the company.
ROI depends on two ratios:
1. Net profit ratio
2. Capital turnover ratio
A change in any of these ratios will change the firm’s earning power.
These two ratios are affected by many factors. A change in any of these factors
19
will change these ratios also. The various factors affecting the ROI can be put
through a chart given below.
20
Return on Investment
(ROI)
Capital Employed
Net Profit
Sales
Capital Turnover
Net Profit Ratio
Sales
Fixed Asset
Working Capital
Expenses Sale
Current Assets
Current liabilities
Administration, Selling and Distribution expenses
Cost of Goods Sold
REVIEW OF RELATED LITERATURE
GEENA.I of All Saints College Trivandrum has done her project in
Trivandrum International Airport on the topic “ Financial Performance of
Trivandrum Airport”
In that she has stated that Trivandrum Airport has been running in a loss
for the years starting from 2001-02 to 2005-06. The profit can be further
increased by focusing more on increasing the revenue and also reducing the
expenditure at the same time.
21
INDUSTRY PROFILE
AIRPORTS AUTHORITY OF INDIA
The beginning:
The International Airports Authority of India (IAAI) an Autonomous body
under ministry of civil aviation was formed in 1972 with the aim to develop and
manage the four International Airports situated in Bombay (now Mumbai) New
Delhi, Calcutta (now Kolkata) and Madras (now Chennai) IAAI lived up to its
expectation and remarkable improvement was visible at these Airports.
In 1986 The Ministry of Civil Aviation created another Autonomous body
called National Airports Authority of India (NAA) for the development and
management of Domestic Airports including Civil Enclaves (small passenger
terminals) at defense Airports. This body was also responsible for air traffic,
services and the related communications, navigation and surveillance facilities in
the country. In 1991, Trivandrum airport was also designated as International
Airport under IAAI.
In 1995, with a view to ensure better co-ordination and optimum use of
recourses, both IAAI and NAA were merged. The unified body called the Airports
Authority of India (AAI).
PROFILE:
Airports Authority of India its ever growing spectrum of operations
provides Air Navigator Services over 2.8 million square nautical miles of
airspace, reaching far beyond the continental airspace.
AAI manages 126 Airports, which include 11 international airports 89
domestic airports and civil enclaves at defense airfields. AAI also provides Air
traffic management services over entire Indian air space and adjoining oceanic
22
areas with ground installations at all airports and 25 other locations to ensure
safety of aircraft operations. It also facilitates passenger services at 28 defense
aerodromes. Last year the authority successfully ensured safe and orderly
movement of 4.9lac aircraft, 42 million passengers and 8.4 lac tonnes of cargo at
Indian Airports.
All major air- routes over Indian landmass are Radar covered (24 Radar
installations at 11 locations) along with VOR/DVOR coverage (72 installations)
co-located with Distance Measuring Equipment(71 installations) 39 runways
provided with ILS installations with Night Landing Facilities at 36 Airports and
Automatic message switching system at 15 Airports.
AAI’s successful implementation of Automatic Dependence Surveillance
system, using indigenous technology, at Kolkata and Chennai air traffic control
centres, gave India the distinction of being the first country to use this advanced
technology in the South East Asian region enabling effective Air Traffic Control
over oceanic areas using satellite mode of communication. Use of remote
controlled VHF coverage, along with satellite communication links, has given
added strength to AAI’s Air Traffic Management system. Linking of 80 locations
by V-Sat installations during 2005 shall vastly enhance Air Traffic Management
and in turn safety of aircraft operations besides enabling administrative and
operational control over AAI’s extensive Airport network. More than 2 lac over
flying flights, using Indian Airspace were immaculately handled by ADI in the
same year.
Extending beyond it’s inundating to function on business principles; AAI
proudly asserts its social obligation of a corporate citizen, entrusted to import
infrastructural facilities and services to bolster civil aviation in the country.
Development of Airports in the NE and the inaccessible region has always been
a priority over commercial considerations. The Authority has invested profoundly
23
in all Airports across the country to realize the latent potential of these regions
and to integrate them with respect to the country.
MODEL AIRPORT
AAI has identified 12 important domestic Airports which are developed as
model airport based on the traffic potential, important of the city tourist potential
and coverage of the entire region in the country.
The runway at the airport is designed to cater for A-320 operations with
standard approach and landing aids, modern communication and navigational
facilities. The terminal building offer excellent facilitation keeping in the view the
ecology and the local environment. The model Airports are Jaipur, Lucknow,
Nagpur, Vadodara, Calicut, Coimbaore, Patna, Bhubaneshwar, Guwahati,
Hyderabad and Imphal. Apart from this, AAI is developing some of the cardinal
Airports which operate tourist traffic. These include Goa, Bangalore, Varanasi
and Agra.
CUSTOMER SATISFACTION AND SAFETY
Customer satisfaction and safety are the core priorities of AAI. In its
endeavor to provide world class passenger amenities and services, the authority
is developing more international Airports in the country and improving facilities in
Domestic Airports.
MODERNISATION
Developing world class Air Navigational infrastructure to effectively
manage Air Traffic is an identified trust area. As part of this drive the authority is
in the process of implementing a VSAT based satellite communication Network
to connect 80 airports in the country to support all operational communication in
the present as well as CNS/ATM environment.
24
Satellite Navigational has also been one of the initiatives for enhancing the
accuracy and reliability of GPS signal which could be gainfully used by other
transport sectors like road transport, railway, forestry, resources exploration,
environmental management etc.
A phased induction of ATC automation systems and also induction of new
facilities to improve standards of safety at Airports and in the Air are in progress.
IT IMPLEMENTATION
Information technology holds the key to operational and managerial
efficiency, transparency and employee productivity. AAI website with domain
name WWW.airportindia.org.in or www.aai.aero is a popular Website giving a
host of information.
OFFICIAL LANGUAGE
Progressive use of Hindi for effective implementation of official language
Act and Rules is constantly encouraged. AAI has bagged a number of prizes for
successful implementation of Rashtra Bhasha.
25
26
COMPANY PROFILE
TRIVANDRUM INTERNATIONAL AIRPORT
Apart from being the Capital city of the State of Kerala,
Thiruvananthapuram (named after the Deity of Thiru Anantha Padmnabhan in
the city) has much historical, geographical and cultural significance, which makes
the city very special in the state as compared to other cities in the state. Though
not so bigger as compared to the city of Cochin in terms of area and population,
the fact of being the Capital city of the erstwhile State of Travancore proved to be
very vital in making the city as Capital State of Kerala on its formation on the 1st
November, 1956.
Originally the people of Kerala, who are said to be having the best
emigrational qualities in the country, were mostly travelling across the seas to the
countries like Sri Lanka, Malaysia, Indonesia and other South-East Asia nations
either through Cochin Port or through Vizhinjam Port, when the air-travel was not
so popular and affordable (one has to go all the way to Madras to catch a flight).
But the rulers of Travancore state with their foresight about the people’s
requirements, seriously thought about the need for building an airport at
Trivandrum, the first in the state. Thus happened the Trivandrum Airport in the
1930s.
Trivandrum airport has a long history of almost 7 decades. The modern
flight services to Trivandrum Airport have commenced on the 29th October,
1935, with the introduction of new passenger air service between Trivandrum
and Bombay. An extract from the pages of the book on the History of Kerala
depicts the photograph of the original Aerodrome of Trivandrum along with the
news item about the first commercial flight to Trivandrum Airport (Annexure-I).
The land required for the construction of runway for landing and take-off of the
aircrafts, was donated by the then Maharajah of Travancore Shri Godha Varma
27
at free of cost.
The Management of the airport has changed many hands over the years
from Civil Aviation Department to National Airports Authority of India to
International Airports Authority of India and finally to the present organisation
“Airports Authority of India – International Airports Division”.
It is one of the five International Airports in India. The Trivandrum Airport
was started after independence. It was built in 1985. The Trivandrum Airport is
situated at a place called ‘Thope’ in the capital city of Kerala -Trivandrum Late
Mr.Rajiv Gandhi, Prime Minster of India, inaugurated the Trivandrum Terminal
building on 5th September 1985.This Airport has been declared as Trivandrum
International Airport with affect from January 1st, 1991 by Sri Harmohan Dhawan,
the then Union minister of Civil Aviation at a function presided over by the Sri
E.K.Nayanar the then Chief Minister of Kerala. The Airport is operated by the
Airport Authority of India.
The Trivandrum Airport is presently handling nearly one million
passengers in international and domestic sectors per annum. The average
annual growth of passenger over nine years period has been about 6 per cent.
The following are the airlines operating from this airport:-
Air India
Indian Airlines
Gulf Air
Srilankan Airlines
Oman Air
28
Qatar Airways
Kuwait Airways
Jet Airways
Silk Air
In addition to the above airlines, some chartered aircraft operated by
private foreign airlines M/S. Monarch Air and M/S. Pulkovo Air are also plying at
Trivandrum during the tourist season on weekly basis.The following are the
various destinations from Trivandrum Airport.
INTERNATIONAL DESTINATIONS
Dubai, Doha, Bahrain, Sharjah, Abu Dubai, Riyadh, Colombo, Singapore,
Male, Kuwait, Muscat and some other indirect destination for European and
North American cities like London, Paris, Frankfurt, New York, New Jersey, Los
Angels etc. through connecting flights
DOMESTIC DESTINATIONS
Mumbai, Chennai, Trichy, Bangalore ,Cochin, Delhi.
29
FACTS AND FIGURES OF TRIVANDRUM INTERNATIONAL
AIRPORT
SL
NO.PARTICULARS SPECIFICATION
1 LAND AREA 583 ACRES
2 RUNWAY LENGTH 3398 MTRS
3 TERMINAL BUILDING TWO(FULLY AIRCONDITIONED)
4 PLINTH AREA-DOMESTIC 5358 SQ.M.
5 PLINTH AREA-INTERNATIONAL 11271SQ.M.
6 TAXIWAY 05
7 PARKING BAYS 08
8 CHECKING COUNTERS-DOMESTIC 07
9 CHECKINGCOUNTERS-INTERNATIONAL 17
10 IMMIGRATION COUNTERS 20
11 CUSTOMS COUNTERS 15
12 SECURITY COUNTERS 07
13 BIGGEST AIRCRAFT THAT CAN LAND BOEING-747(JUMBO JET)
14 SURVEILLANCE AIDS AVAILABLE ARSR+MSSR (120.9MHZ.
ASR+MSSR 119.6MHZ)
15 NAVIGATIONAL AIDS AVAILABLE DVOR(115.1MHZ)
DME(1185MHZ)
NDB(229KHZ)
30
RESEARCH METHODOLOGY
Data Collection
Since the project is aimed at compiling the analysis of various financial
statements of Trivandrum Airport the same have to be derived mainly from the
Secondary data available in the Trial Balances/Balance Sheets/Annual Reports
of the company. However, Primary Data has also been employed in collecting
the Operations and Functions of Airport, which are not readily available on
record.
Primary Data:
The modus operandi includes discussions with:-
Managers and Finance Executives
Non-executives in the departments
Who have guided me in understanding the financial activities of the
airport, the sources of cash inflows/outflows etc.
Secondary Data:
Secondary data collected from Trivandrum Airport’s Trial
Balances/Balance Sheets/Annual Reports for the period from 2002-03 to 2006-
07, budget and by referring to Traffic magazines of AAI, various
booklets/presentations etc. Some of the information has also been gathered from
the Airports Authority of India’s official websites .
31
TOOLS OR TECHNIQUES:
All data collected were summarily tabulated and presented so as to
facilitate proper understanding and comparison. Percentages have been used to
show the relative significance of each variable. Bar Diagrams and Line Diagrams
have been used to pectoris.
Ratio analysis
Comparative income and expenditure statement.
PERIOD OF THE STUDY:
The accounting year of the company commences from 1st April and closes
by 31st March of the next year. The duration of the study is for five years from
2002-03 to 2006-07
32
ANALYSIS AND INTERPRETATION.
RATIO ANALYSIS
TABLE NO – 4.1
TABLE SHOWING FIXED ASSET TURNOVER RATIO.
FINANCIAL YEAR
TOTAL REVENUE
FIXED ASSETS RATIO
2002-03 2,361.36 5,277.11 0.452003-04 2,671.43 5,116.69 0.522004-05 2,357.95 7,059.45 0.332005-06 3,584.98 7,200.17 0.502006-07 4406.75 7170.81 0.61
INTERPRETATION
Highest ratio -- 3.01 during the year 2004-05.
Lowest ratio -- 0.61 during the year 2006-07.
The fixed asset turn-over ratio generally indicates the
performances of f ixed assets in generating the levels of revenue.
The more generation of revenue, the better performances of f ixed
assets. From 2002-03 onwards there is an increasing trend of the
performances ti l l 2003-04 and it peaked in 2006-07.
33
CHART NO – 4.1.1
0.45
0.52
0.33
0.5
0.61
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING FIXED ASSET TURNOVER RATIO
RATIO
34
TABLE NO – 4.2
TABLE SHOWING CURRENT RATIO.
FINANCIAL YEAR
CURRENT ASSET
CURRENT LIABILITIES
RATIO
2002-03 1,731.34 1,147.26 1.51
2003-04 1,843.16 1,097.24 1.68
2004-05 2,176.26 722.18 3.01
2005-06 2,157.32 831.57 2.59
2006-07 5410.38 868.01 6.23
INTERPRETATION
Highest ratio -- 6.23 during the year 2006-07.
Lowest ratio -- 1.51 during the year 2002-03.
The above table reveals that the current ratio of Trivandrum
airport is on an increasing trend from 1.51 in the year 2002-03 to
3.01 in the year 2004-05.
35
36
CHART NO – 4.2.2
1.511.68
3.01
2.59
6.23
0
1
2
3
4
5
6
7
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING CURRENT RATIO
RATIO
37
TABLE NO – 4.3
TABLE SHOWING REVENUE STAFF COST RATIO
FINANCIAL YEAR
STAFF COSTTOTAL
REVENUERATIO
2002-03 1,383.60 2,361.36 0.59
2003-04 1,351.40 2,671.43 0.51
2004-05 1,508.96 2,357.95 0.64
2005-06 1,678.96 3,584.98 0.47
2006-07 1711.50 4406.75 0.39
INTERPRETATION
Highest ratio -- 0.64 during the year 2004-05.
Lowest ratio -- 0.39 during the year 2006-07.
The revenue staff cost ratio generally indicates the level of
staff cost in generating the levels of revenue. The less the staff cost
in generating more revenue is good for the company. The
Trivandrum airport has shown a tremendous performance by
38
reducing the ratio to 0.39. The ideal ratio for any company should be
around 0.4.
CHART NO – 4.3.3
0.59
0.51
0.64
0.47
0.39
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING REVENUE STAFF COST RATIO
RATIO
39
TABLE NO – 4.4
TABLE SHOWING OPERATING COST RATIO
FINANCIAL YEAR
OPERATING COST
TOTAL REVENUE
RATIO
2002-03 482.92 2,361.36 0.20
2003-04 567.93 2,671.43 0.21
2004-05 832.29 2,357.95 0.35
2005-06 681.00 3,584.98 0.19
2006-07 896 4406.75 0.20
INTERPRETATION
Highest ratio -- 0.35 during the year 2004-05.
Lowest ratio -- 0.19 during the year 2005-06.
40
The operating cost ratio generally indicates the level of
operating cost in generating the levels of revenue. The less the
operating cost in generating more revenue is good for the company.
In 2004-05 the trivandrum airports operating cost has jumped to 0.35
which is considered to be very high compared to the revenue. It has
bettered its performance by reducing it to 0.19 in the year 2005-06.
Which is an all t ime low ratio and indicates the best performance so
far.
CHART NO – 4.4.4
41
0.2 0.21
0.35
0.19 0.2
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING OPERATING COST RATIO
RATIO
TABLE NO – 4.5
TABLE SHOWING REVENUE SECURITY EXPENSES RATIO
42
FINANCIAL YEARSECURITY EXPENSES
TOTAL REVENUE
RATIO
2002-03 184.39 2,361.36 0.08
2003-04 273.89 2,671.43 0.10
2004-05 284.64 2,357.95 0.12
2005-06 316.80 3,584.98 0.09
2006-07 330.00 4406.75 0.07
INTERPRETATION
Highest ratio -- 0.12 during the year 2004-05.
Lowest ratio -- 0.07 during the year 2006-07.
This ratio shows an increase from the year 2002-03 to 2004-
05. The ratio earned in the year 2004-05 is the highest mainly
because the revenue earned during that year is comparatively very
less. The lower the ratio the better the performance.
CHART NO – 4.5.5
43
0.08
0.1
0.12
0.09
0.07
0
0.02
0.04
0.06
0.08
0.1
0.12
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING REVENUE SECURITY EXPENSE RATIO
RATIO
TABLE NO – 4.6
44
TABLE SHOWING DEPRECIATION COST RATIO
FINANCIAL YEAR DEPRECIATION TOTAL REVENUE RATIO
2002-03 628.34 2,361.36 0.27
2003-04 595.88 2,671.43 0.22
2004-05 806.71 2,357.95 0.34
2005-06 694.18 3,584.98 0.19
2006-07 720.00 4406.75 0.16
INTERPRETATION
Highest ratio -- 0.34 during the year 2004-05.
Lowest ratio -- 0.16 during the year 2006-07.
This ratio shows an decline from the year 2002-03 to 2003-04.
The ratio earned in the year 2004-05 is the highest mainly because
the revenue earned during that year is comparatively very less. The
lower the ratio the better the performance.
45
CHART NO – 4.6.6
0.27
0.22
0.34
0.19
0.16
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING DEPRECIATION COST RATIO
RATIO
46
TABLE NO – 4.7
TABLE SHOWING ADMINISTRATIVE COST RATIO
FINANCIAL YEAR
ADMINISTRATIVE COST
TOTAL REVENUE RATIO
2002-03 140.83 2,361.36 0.06
2003-04 179.95 2,671.43 0.07
2004-05 205.87 2,357.95 0.09
2005-06 256.21 3,584.98 0.07
2006-07 237.00 4406.75 0.05
INTERPRETATION
Highest ratio -- 0.09 during the year 2004-05.
Lowest ratio -- 0.05 during the year 2006-07.
Average ratio -- 0.07
The administrative cost ratio is almost steady in all the years
with not much difference between the average ratio and the
lowest/highest ratio. As such this ratio in respect of Trivandrum
airport is within control and is acceptable.
47
CHART NO – 4.7.7
0.06
0.07
0.09
0.07
0.05
0
0.01
0.02
0.03
0.04
0.05
0.06
0.07
0.08
0.09
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING ADMINISTRATIVE COST RATIO
RATIO
48
TABLE NO – 4.8
TABLE SHOWING NET PROFIT RATIO
FINANCIAL YEAR
NET PROFIT TOTAL
REVENUERATIO
2002-03 (458.72) 2,361.36 (0.19)
2003-04 (297.62) 2,671.43 (0.11)
2004-05 (1,002.88) 2,357.95 (0.43)
2005-06 (54.59) 3,584.98 (0.02)
2006-07 512.25 4406.75 0.12
INTERPRETATION
Highest ratio -- 0.12 during the year 2006-07.
Lowest ratio -- (0.02) during the year 2005-06.
The Trivandrum airport is continuously on a loss form the year
2002-03 to 2005 -06. There has been a profit of 0.12 in the year
2006-07. This shows that the company is improving its performance.
The highest loss was in the year 2004-05 mainly due to the major
49
building maintenance work executed by the airport, which is done
once in 5 years.
CHART NO – 4.8.8
-0.19
-0.11
-0.43
-0.02
0.12
-0.5
-0.4
-0.3
-0.2
-0.1
0
0.1
0.2
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING NET PROFIT RATIO
RATIO
50
TABLE NO – 4.9
TABLE SHOWING WORKING CAPITAL TURNOVER RATIO
FINANCIAL YEARTOTAL
REVENUENET-WORKING
CAPITALRATIO
2002-03 2,361.36 584.08 4.04
2003-04 2,671.43 745.92 3.58
2004-05 2,357.95 1,454.08 1.62
2005-06 3,584.98 1,325.75 2.70
2006-07 4406.75 4542.37 0.97
INTERPRETATION
Highest ratio -- 4.04 during the year 2002-03.
Lowest ratio -- 0.97 during the year 2004-05.
51
The table shows that the working capital turnover ratio is on a
decreasing trend from 2002-03 to 2004-05. The higher the ratio the
better is the performance of the company.
CHART NO – 4.9.9
52
4.04
3.58
1.62
2.7
0.97
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING WORKING CAPITAL TURNOVER RATIO
RATIO
TABLE NO – 4.10
53
TABLE SHOWING DEBTORS TURNOVER RATIO
FINANCIAL YEAR
TOTAL REVENUE DEBTORS RATIO
2002-03 2,361.36 576.81 4.09
2003-04 2,671.43 586.38 4.56
2004-05 2,357.95 381.56 6.18
2005-06 3,584.98 461.87 7.76
2006-07 4406.75 513.29 8.59
INTERPRETATION
Highest ratio -- 8.59 during the year 2006-07.
Lowest ratio -- 4.09 during the year 2002-03.
The above table indicates that the sundry debtors turnover
ratio is on an increase from the year 2002-03 to 2006-07. The
highest the ratio the better it is since it would indicate that debts are
being collected more promptly.
CHART NO – 4.10.10
54
4.094.56
6.18
7.76
8.59
0
1
2
3
4
5
6
7
8
9
Ratio
2002-03 2003-04 2004-05 2005-06 2006-07
Date
CHART SHOWING DEBTORS TURNOVER RATIO
RATIO
TABLE NO – 4.11
55
TABLE SHOWING COMPARATIVE INCOME AND EXPENDITURE STATEMENT
FOR THE YEAR 2002-03 AND 2003-04.
PARTICULARS 2002-03 2003-04
ABSOLUTE INCREASE OR DECREASE IN
2003-04
PERCENTAGE INCREASE OR DECREASE IN
2003-04I N C O M EA.TRAFFIC REVENUE1.Landing and parking charges 1119.55 1,310.58 191.03 17.062.Passenger service fee 663.30 700.00 36.7 5.53TOTAL (A) 1782.85 2010.58 227.73 12.77
C.NON-TRAFFIC REVENUE
1.Public admission fee 36.40 32.56 (3.84) (10.55)
2.Trading concession 267.83 284.51 16.68 6.23
3.Rent and services 172.51 201.43 28.92 16.76
4.Miscelleneous 101.77 142.35 40.58 39.87
5.Interest on investment - - - -
TOTAL ( C ) 578.51 660.85 82.34 14.23
TOTAL REVENUE : A+B+C 2361.36 2671.43 310.07 13.13
E X P E N D I T U R E
STAFF COST
1.Pay and allowances 1383.60 1,351.40 (32.2) (2.33)Pay and allowance & other staff benefit
1383.60 1351.40 (32.2) (2.33)
2.Repair and maintenance 239.12 298.80 59.68 24.963.Consumption of stores and spares
27.38 28.24 0.86 3.14
4.Electricity and water 216.42 240.89 24.47 11.31
5.Other expenses 140.83 179.95 39.12 27.78
TOTAL OTHER EXPENSES 623.75 747.88 124.13 19.901
6.Depreciation 628.34 595.88 (32.46) (5.17)
7.Financial charges - - - -
8.Security expenses 184.39 273.89 89.5 48.54
TOTAL EXPENDITURE 2820.08 2969.05 148.97 5.28
PROFIT BEFORE TAX (458.72) (297.62) (16.11) 35.12
56
INTERPRETATION
The table shows that when comparing the income and
expenditure of the year 2003 and 2004 there has been a percentage
increase of 13.13 in the revenue and a percentage increase of 5.28
in the expenditure. The profit has also increased by 35.12 percent.
57
TABLE NO – 4.12
TABLE SHOWING COMPARATIVE INCOME AND EXPENDITURE
STATEMENT FOR THE YEAR 2003-04 AND 2004-05
PARTICULARS 2003-04 2004-05
ABSOLUTE INCREASE
OR DECREASE IN 2003-04
PERCENTAGE INCREASE OR DECREASE IN
2003-04
I N C O M EA.TRAFFIC REVENUE1.Landing and parking charges 1,310.58 1,262.98 (47.60) (3.63)2.Passenger service fee 700.00 400.00 (300) (42.86)
TOTAL (A) 2010.58 1662.98 (347.6) (17.29)C.NON-TRAFFIC REVENUE
1.Public admission fee 32.56 29.69 (2.87) (8.81)2.Trading concession 284.51 320.60 36.09 12.683.Rent and services 201.43 192.52 (8.91) (4.42)4.Miscelleneous 142.35 152.16 9.81 6.895.Interest on investment - - -
TOTAL ( C ) 660.85 694.97 34.12 5.16
TOTAL REVENUE : A+B+C 2671.43 2357.95 (13.48) (0.504)
E X P E N D I T U R E
STAFF COST
1.Pay and allowances 1,351.40 1,508.96 157.56 11.66Pay and allowance & other staff benefit
1351.40 1508.96 157.56 11.66
2.Repair and maintenance 298.80 544.10 245.30 82.103.Consumption of stores and spares
28.24 37.50 9.26 32.79
4.Electricity and water 240.89 257.69 16.80 6.975.Other expenses 179.95 205.87 25.92 14.40
TOTAL OTHER EXPENSES 747.88 1045.16 297.28 39.75
6.Depreciation 595.88 806.71 210.83 35.387.Financial charges - -8.Security expenses 273.89 - (273.89) (100)
TOTAL EXPENDITURE 2969.05 3360.83 391.78 13.20
PROFIT BEFORE TAX (297.62) (1002.88) (705.26) 236.97
58
INTERPRETATION
The table shows that when comparing the income and
expenditure of the year 2004 and 2005 there has been a percentage
decrease of 0.504 in the revenue and a percentage increase of
13.20 in the expenditure. The profit has also increased by
236.97percent.
59
TABLE NO – 4.13
TABLE SHOWING COMPARATIVE INCOME AND EXPENDITURE
STATEMENT FOR THE YEAR 2004-05 AND 2005-06
PARTICULARS2004-05 2005-06
ABSOLUTE
INCREASE OR
DECREASE IN 2003-
04
PERCENTAGE INCREASE OR DECREASE IN
2003-04
I N C O M EA.TRAFFIC REVENUE
1.Landing and parking charges 1,262.98 1,398.38 135.40 10.72 2.Passenger service fee 400.00 1378.55 978.55 244.64
TOTAL (A) 1662.98 2776.93 1,113.95 66.99C.NON-TRAFFIC REVENUE
1.Public admission fee 29.69 - (29.69) (100)! 2.Trading concession 320.60 322.34 1.74 0.54 3.Rent and services 192.52 197.74 5.22 2.71 4.Miscelleneous 152.16 287.46 135.30 88.92 5.Interest on investment -
TOTAL ( C ) 694.97 807.54 112.57 16.20TOTAL REVENUE : A+B+C 2357.95 3584.47 1,226.52 52.02
E X P E N D I T U R E
STAFF COST
1.Pay and allowances 1508.96 1678.96 170.00 11.27Pay and allowance & other staff benefit
1508.96 1678.96170.00 11.27
2.Repair and maintenance 544.10 312.86 (231.24) (42.50) 3.Consumption of stores and
spares37.50 39.14
1.64 4.37 4.Electricity and water 257.69 328.99 71.30 27.67 5.Other expenses 205.87 268.13 62.26 30.24
TOTAL OTHER EXPENSES 1045.16 949.12 (96.04) (9.19) 6.Depreciation 806.71 694.18 (112.53) (13.95) 7.Financial charges - - - - 8.Security expenses - 316.80 316.80 100
TOTAL EXPENDITURE 3360.83 3639.06 278.23 8.28PROFIT BEFORE TAX (1002.88) (54.56) 948.32 (94.56)
60
INTERPRETATION
The table shows that when comparing the income and
expenditure of the year 2005 and 2006 there has been a percentage
increase of 52.02 in the revenue and a percentage increase of 8.28
in the expenditure. The profit has also decreased by 94.56 percent.
61
TABLE NO – 4.14
TABLE SHOWING COMPARATIVE INCOME AND EXPENDITURE
STATEMENT FOR THE YEAR 2005-06 AND 2006-07
PARTICULARS2005-06 2006-07
ABSOLUTE INCREASE
OR DECREASE IN 2003-04
PERCENTAGE INCREASE OR DECREASE IN
2003-04
I N C O M EA.TRAFFIC REVENUE
1.Landing and parking charges 1,398.38 1817.50 419.12 29.97 2.Passenger service fee 1378.55 1648.25 269.70 19.56
TOTAL (A) 2776.93 3465.75 688.82 24.81C.NON-TRAFFIC REVENUE
1.Public admission fee - 23.00 23.00 100 2.Trading concession 322.34 443.00 120.66 37.43 3.Rent and services 197.74 232.00 34.26 17.33 4.Miscelleneous 287.46 243.00 -44.46 (15.47) 5.Interest on investment - - - -
TOTAL ( C ) 807.54 941.00 133.46 16.53
TOTAL REVENUE : A+B+C 3584.47 4406.75 822.28 22.94
E X P E N D I T U R E
STAFF COST
1.Pay and allowances 1678.96 1711.50 32.54 1.94Pay and allowance & other staff benefit
1678.96 1711.50 32.54 1.94
2.Repair and maintenance 312.86 482.50 169.64 54.22 3.Consumption of stores and
spares39.14 48.50 9.36 23.91
4.Electricity and water 328.99 364.50 35.51 10.79 5.Other expenses 268.13 237.50 -30.63 (11.42)
TOTAL OTHER EXPENSES 949.12 1133.00 183.88 19.37
6.Depreciation 694.18 720.00 25.82 3.72 7.Financial charges - - - - 8.Security expenses 316.80 330.00 13.20 4.17
TOTAL EXPENDITURE 3639.06 3894.50 255.44 7.02
PROFIT BEFORE TAX (54.56) 512.5 567.06 (1039.33)
62
INTERPRETATION
The table shows that when comparing the income and
expenditure of the year 2006 and 2007 there has been a percentage
increase of 22.94 in the revenue and a percentage increase of 7.02
in the expenditure. The profit has also decreased by 1039.33
percent.
63
TABLE NO – 4.15
DU PONT CONTROL TABLE FOR THE YEAR 2002-03
Particulars Amount
Current asset 1731.34
Current l iabil i ty 1147.26
Fixed asset 4984.57
Sales 2361.36
Administration sell ing and distribution
expenses
140.83
Working capital 584.08
Capital employed 5568.65
Expenses 140.83
Net profit 2220.53
Net profit ratio 0.94
Capital turnover 0.42
Return on investment 0.39
64
CHART NO – 4.15.11
DU PONT CONTROL CHART FOR THE YEAR 2002-03
0.39
0.42 0.94
4984.57
65
5568.65 2220.532361.362361.36
584.08 140.83 2361.36
1731.34 1147.26 140.83
TABLE NO – 4.16
DU PONT CONTROL TABLE FOR THE YEAR 2003-04
Particulars Amount
Current asset 1843.16
Current l iabil i ty 1097.24
Fixed asset 5277.11
Sales 2671.43
Administration sell ing and distribution
expenses
179.95
Working capital 745.92
Capital employed 6023.03
Expenses 179.95
Net profit 2491.48
66
Net profit ratio 0.93
Capital turnover 0.44
Return on investment 0.41
CHART NO – 4.16.12
DU PONT CONTROL CHART FOR THE YEAR 2003-04
67
0.41
6023.03 2491.482671.43
0.44 0.93
2671.43
1843.16 1097.24 179.95
5277.11 745.92 179.95 2671.43
TABLE NO – 4.17
DU PONT CONTROL TABLE FOR THE YEAR 2004-05
Particulars Amount
Current asset 2176.26
Current l iabil i ty 722.18
Fixed asset 5116.69
Sales 2357.95
Administration sell ing and distribution
expenses
205.87
Working capital 1454.08
Capital employed 6570.77
Expenses 205.87
Net profit 2291.08
Net profit ratio 0.97
Capital turnover 0.36
Return on investment 0.35
68
CHART NO – 4.17.13
DU PONT CONTROL CHART FOR THE YEAR 2004-05
69
TABLE NO – 4.18
DU PONT CONTROL TABLE FOR THE YEAR 2005-06
Particulars Amount
Current asset 2157.32
Current l iabil i ty 831.57
Fixed asset 7059.45
Sales 3584.98
Administration sell ing and distribution
expenses
256.21
Working capital 1325.75
Capital employed 8385.2
Expenses 256.21
Net profit 3328.77
70
Net profit ratio 0.93
Capital turnover 0.43
Return on investment
CHART NO – 4.18.14
DU PONT CONTROL CHART FOR THE YEAR 2005-06
71
TABLE NO – 4.19
DU PONT CONTROL TABLE FOR THE YEAR 2006-07
Particulars Amount
Current asset 3214.07
Current l iabil i ty 868.01
Fixed asset 7200.17
Sales 4406.75
72
Administration sell ing and distribution
expenses
237.00
Working capital 2346.06
Capital employed 9546.23
Expenses 237.00
Net profit 4169.75
Net profit ratio 0.95
Capital turnover 0.46
Return on investment 0.44
CHART NO – 4.19.15
DU PONT CONTROL CHART FOR THE YEAR 2006-07
73
FINDINGS
The current ratio of Trivandrum airport is on an increasing
trend except in the year 2005-06 it shows a slight decline.
74
The Trivandrum airport has shown a tremendous performance
by reducing the ratio to 0.39 in the year 2006-07.
In 2004-0 the Trivandrum airports operating cost has jumped
to 0.35 which is considered to be very high compared to the
revenue.
The security expense ratio shows an increase from the year
2002-03 to 2004-05.
The depreciation cost ratio shows an increase from the year
2002-03 to 2004-05.
The administrative cost ratio is almost steady in all the years
with not much difference between the average ratio and the
lowest/highest ratio.
The Trivandrum airport is continuously on a loss form the year
2002-03 to 2005 -06. There has been a profit of 0.12 in the
year 2006-07.
The working capital turnover ratio is on a decreasing trend
from 2002-03 to 2004-05.
The sundry debtor’s turnover ratio is on an increase from the
year 2002-03 to 2006-07.
In comparison to the revenue, the expenditure was more
during the last 4 years and in the year 2006-07, it appears that
75
Trivandrum airport has come out of red and started to make
profits.
SUGGESTIONS
A reduction in the staff cost and operating cost can increase the revenue.
The depreciation cost ratio can be increased by increasing the revenue
It is also learnt that some more airlines like Paramount Airways, Air
Sahara, Kingfisher Airlines, Go Air etc. are going to start their operations
from Trivandrum airport very soon. This will result in more revenues for
the Trivandrum airport and its financial position appears to be fatter than
ever before
To focus on the likely avenues for generation of additional revenue for the
investors.
76
CONCLUSION
From the above analysis it is seen that compared to the last
four years there has been an increase in the profit. It can be said
that the Trivandrum airport is running in a profit compared to the
previous years. The profit can be further increased by focusing more
on increasing the revenue and also reducing the expenditure at the
same time.
The revenue can be increased by:
By concentrating on earning non-aeronautical revenue (non-
traff ic revenue) by building good hotels, business centers,
shopping malls, multiplexes in the airport complex so that a
visit to airport by any one proves an enjoyable experience and
at the same time it gives good revenue to the Service
Provider.
77
The more the aircraft movement, the more is the revenue for
the airports. At this juncture, the addit ional investments made
are definitely going to yield addit ional revenue for the airports.
ANNEXURE
PARTICULARS 2002-03
2003-04 2004-05 2005-06 2006-07
I N C O M EA.TRAFFIC REVENUE
1.Landing and parking charges 1119.55
1,310.58
1,262.98
1,398.38
1817.5
2.Passenger service fee 663.3 700 400 1378.55 1648.25TOTAL (A) 1782.8
52010.58 1662.98 2776.93 3465.75
C.NON-TRAFFIC REVENUE1.Public admission fee 36.4 32.56 29.69 - 23
2.Trading concession 267.83 284.51 320.6 322.34 443 3.Rent and services 172.51 201.43 192.52 197.74 232 4.Miscelleneous 101.77 142.35 152.16 287.46 243 5.Interest on investment - - - - -
TOTAL ( C ) 578.51 660.85 694.97 807.54 941TOTAL REVENUE : A+B+C 2361.3
62671.43 2357.95 3584.47 4406.75
E X P E N D I T U R ESTAFF COST
78
1.Pay and allowances1383.6
1,351.40
1,508.96
1678.96 1711.5
Pay and allowance & other staff benefit
1383.6 1351.4 1508.96 1678.96 1711.5
2.Repair and maintenance 239.12 298.8 544.1 312.86 482.5 3.Consumption of stores and spares 27.38 28.24 37.5 39.14 48.5 4.Electricity and water 216.42 240.89 257.69 328.99 364.5 5.Other expenses 140.83 179.95 205.87 268.13 237.5
TOTAL OTHER EXPENSES 623.75 747.88 1045.16 949.12 1133 6.Depreciation 628.34 595.88 806.71 694.18 720 7.Financial charges - - - - - 8.Security expenses 184.39 273.89 - 316.8 330
TOTAL EXPENDITURE 2820.08
2969.05 3360.83 3639.06 3894.5
PROFIT BEFORE TAX-458.72 -297.62
-1002.88
-54.56 512.5
GG111 LAND FREEHOLD INCLUDING LAND DEVELOP.EXP
68,229,421.93
GG211 RUNWAYS 97,878,560.45
GG212 TAXIWAYS 32,336,547.22
GG213 APRONS 90,810,890.47
GG214 ROADS, BRIDGES & CULVERTS-OPS AREA 45,077,357.71
GG311 TERMINAL BUILDING 134,874,581.66
GG312 BUILDING ON THE OPERATIONAL AREA 28,998,711.94
GG313 CARGO COMPLEX 662,441.77
GG317 RESIDENTIAL BLDG. - TYPE A 244,000.00
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GG321 OTHER BUILDINGS - UNCLASSIFIED 17,772,409.50
GG411 BUILDING TEMPORARY 2,197,067.16
GG412 PURELY TEMPORARY WOODEN STRUC 13,000.00
GG511 SECURITY FENCING 8,212,104.87
GG711 PLANT & MACHINERY - GENERAL 403,888.41
KK411 AMT. RECOVERABLE FROM CLIENTS-IN INDIA 1823264.43
KK512 AMOUNT DUE FROM VARIOUS AIRLINES 35357097.75
KK513 AMOUNT DUE FROM PVT. PARTIES 4780587.91
KK514 AMOUNT DUE FROM OTHERS 4226268.83
LL111 CASH & STAMP IN HAND - IN INDIA 39427.00
LL113 CASH AT COUNTERS 7196.00
LL212 CHEQUES IN HAND 7501716.87
LL213 CASH WITH BANK CANARA BANK(DISBURSEMENT)
12750893.64
LL214 CASH WITH BANK CANARA BANK (REVENUE) 6887.00
MM111 HOUSE BUILDINGS/PURCHASE LOANS 82785158.00
MM112 MOTOR CAR LOAN 6511919.00
MM113 MOTOR CYCLE LOAN 3264601.00
MM116 COMPUTER ADVANCE 7108419.00
MM131 FESTIVAL ADVANCE 381600.00
MM133 TRAVELLING ADVANCE 678100.00
MM134 L.T.C. ADVANCE 537474.00
MM135 MEDICAL ADVANCE 48851.00
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MM191 MISCELLANEOUS ADV. TO STAFF 12394.00
MM211 ADV. TO SUPPLIERS - IN INDIA 2529.00
MM342 INCOME ACCURED BUT NOT RECEIVED 9318754.00
MM512 DEPOSITS WITH STATE ELECT. BOARDS 39458095.00
MM551 MISECELLANEOUS DEPOSITS 1024822.00
DD111 LIABILITY FOR GOODS SP/WORKDONE-CAPITAL 15581912.1
DD112 LIABILITY FOR GOODS SP/WORKDONE-REVENUE
15618172.38
DD211 LIABILITY FOR PAY & ALLW UNPAID WAGES 13507984
DD215 LIABILITY FOR REPAIRS & MAINT. 13455689
DD216 LIABILITY FOR ANTI-HIJACKING EXP 5014949
DD219 LIABILITY FOR OTHER EXPENSES. 187326
DD311 TAX DEDUCTED AT SOURCE CONTRACTORS 158526
DD319 WORKS CONTRACT SALES TAX 97099
DD321 WORKER'S WELFARE CESS FUND 141379
DD329 SERVICE TAX BILLED NOT RECEIVED 1201191
DD411 EMD - WORKS & SUPPLIES 1756394
DD412 EMD - COMMERCIAL CONTRACTS 312596
DD413 SECURITY DEPOSITS - WORKS & SUPPLIES 5851086
DD414 SECURITY DEPOSITS - COMMERICIAL CONTRACT
3456429.2
DD431 MISC DEPOSITS 6273418
DD611 INCOME RECEIVED IN ADVANCE BUT NOT DUE 188798.28
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BIBLIOGRAPHY
Khan M Y and Jain P K, “ Management Accounting”, Tata
Mc Graw Hil l 3 r d edit ion
Maheshwari S N, “ Principles of management accounting”,
Sultan Chand and sons.
www.airportsindia.org.in
www.aai.aero
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