SUMMER INTERNSHIP

PROJECT REPORT ON
TRIDENT ACADEMY OF
CREATIVE TECHNOLOGY,
CHANDRASEKHARPUR, ACCOUNT PAYABLE &
BHUBANESWAR, ODISHA FIXED ASSETS

Website: www.trident.org ABHISEK DEHURY

Reg.No- 2106266002

FACULTY GUIDE: INDUSTRIAL GUIDE:

Mr.Aditya Prakash Sahoo Mr. Brahmananda Ojha
(Head of Plant accounts)
 Trident Academy of Creative Technology,
Chandrasekharpur , Bhubaneswar, Odisha

SUMMER INTERNSHIP PROJECT REPORT ON

“ACCOUNT PAYABLE PROCESS”

SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE AWARD OF DEGREE OF

MASTER IN BUSINESS ADMINISTRATION
SESSION 2021-2023

FACULTY GUIDE: INDUSTRIAL GUIDE:

Mr.Aditya Prakash Sahoo Mr. Brahmananda Ojha
(Head of Plant Accounts)

SUBMITTED BY:
ABHISEK DEHURY

(Reg.no-2106266002)
MBA (2021-23)

ACCOUNT PAYABLE AND FIXED ASSETS Page 2

 DECLARATION
I Abhisek Dehury student of MBA (2021-23) hereby declare that I have completed
this project ACCOUNT PAYABLE. The information submitted is true to the
best of my knowledge.

Abhisek Dehury
Reg.No-2106266002

ACCOUNT PAYABLE AND FIXED ASSETS Page 3

 TABLE OF CONTENT

1. ACKNOWLEDGEMENT

2. EXECUTIVE SUMMARY

3. OBJECTIVE

4. INTRODUCTION

5. COMPANY PROFILE

6. RESEARCH METHODOLOGY

7. DOCUMENTS REQUIRED FOR ACCOUNTS PAYABLE

8. ACCOUNT PAYABLE PROCESS OF AISCO

9. ANALYSIS & PRESENTATION OF DATA AND INTERPRETATION

10.FINDING

11. SUGGESTIONS & RECOMMENDATIONS:

12. CONCLUSION

13. REFERENCES/BIBLIOGRAPHY

ACCOUNT PAYABLE AND FIXED ASSETS Page 4

 ACKNOWLEDGEMENT

First, I would like to thank Dr. Pradyumna Kumar Bidyadhar Sir,

Assist. General Manager-HR& Admin of AISCO, Odisha for giving
me the opportunity to do an internship within the organization.
I also would like all the people that worked along with me at AISCO,
Odisha with their patience and openness they created an enjoyable
working environment.
It is indeed with a great sense of pleasure and immense sense of
gratitude that I acknowledge the help of these individuals.
I would like to thank my Head of the Department Mr. Brahmananda
Ojha Sir, Assist. General Manager-F&A for his constructive criticism
throughout my internship
I would like to thank Dr. M.N Dwibedi Sir principal of trident College,
internship coordinator Mr. Nargis Begum Mam, internship coordinator
Department of MBA for their support and advices to get and complete
internship in above said organization.
I am extremely great full to my department staff members and friends
who helped me in successful completion of this internship.

Abhisek Dehury
Reg.No-2106266002

ACCOUNT PAYABLE AND FIXED ASSETS Page 5

Executive Summary
This project deals in “Account Payable at Arya Iron Steel Company
Pvt Ltd”. Payable Management and Fixed Asset Management is one
of the most important aspects of the organization, as they all deal with
the internal management of the organization. The Accounts payable
help to reduce the liabilities of the companies and sound fixed asset
management can lead to a substantial tax savings in depreciation
deductions, poor fixed asset practices can threaten the accuracy of
financial reports, causing re-reporting and negatively impacting the
bottom line. Therefore, it needs a careful analysis and proper
management.
Creditor are the liabilities for the company which company
have to pay as soon as possible in this Accounts payable helps
the company to pay off the creditors. On the other hand Fixed
Asset Management helps the company to put tracking and
depreciating fixed asset, which is an important task for the
organization.
With an increasing domestic and international competition,
AISCO is using decent policy, in order to maintain its premium
position, with proper control on Accounts Payable and Fixed
Assets Management.

ACCOUNT PAYABLE AND FIXED ASSETS Page 6

Objectives of Internship:
1. Gain practical experience in a professional setting.
2. Gaining essential background knowledge.
3. Network with professionals in the industry.
4. Gained knowledge about performing specific tasks and develop
problem identification and problem-solving skills in finance
management /accounting.
5. Develop problem solving and critical thinking skill
6. To understand the working procedure of Accounts department.
7. To understand the working procedure of Remittance department.

The role of Finance & Accounts Department:

1. Manage all day-to-day Finance & Accounts activities of the
company
2. Support the functioning of the Finance committee.
3. Implement the decisions of the Finance committee & helps the
Management for Decision making Process.
4. Verifications of Vouchers and remittance to Sundry Creditors
5. Preparing of Financial Statements & Analysis and submitting to
Govt. Authorities.

ACCOUNT PAYABLE AND FIXED ASSETS Page 7

 INTRODUCTION

LITERATUREREVIEW:-

For Accounts Payable:

What is Account Payable?

Accounts Payable is a means by which you can monitor the disbursement of

money from you company simply put, Accounts payable records and pays a
company’s bill or liabilities.

When a liability or debt is incurred, the vendor to whom the money is owed issues
an “invoice”. The debt or liability is recorded into Account Payable when you
enter the invoice. On the basis of this Account payable, the company is able to pay
off all their liabilities.

The Accounts Payable Cycle

Accounts Payable is normally operated on a monthly accounting cycle. During

the month you enter and post hand checks as they are issued. Then perhaps
weekly, bi-weekly or even daily, depending on the volume of invoices you
receive, you use the checks processing cycle to create, print and post machine
check payment to your vendors. At the end of the month, print the monthly reports
and balance the accounts payable subsidiary ledger to your General Ledger.
Finally, run the close month process to close accounts payable for the current
month and prepare for the next month’s processing.

Reports can be printed and inquiries used to supply information at any time
during the month.

Fixed Assets:

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 Fixed asset is an asset held with the intention of being used for
the purpose of producing or providing goods or services and is
not held for sale in the normal course of business. Fixed assets
often comprise a significant portion of the total assets of an
enterprise, and therefore are important in the presentation of
financial position. Furthermore, the determination of whether
expenditure represents an asset or an expense can have a
material effect on an enterprise's reported results of operations.

Fixed Assets also need to be capitalized because when it start

giving revenue we have to record it how much a asset is giving
the Profit and how much depreciation we are charging on it.

The project is covered of fixed assets of AISCO drawn from

annual reports of the company. The fixed assets considered in
the project are which cannot be converted into cash with one
year. Ration analysis is used for evaluating fixed assets
performance of AISCO.

The subject matter is limited to fixed assets its analysis

and its performance but not any other areas of
accounting corporate, marketing and financial matters.

NEED FOR VALUATION OF FIXED ASSETS:

Valuation of fixed assets is important in order to have fair measure of

profit or loss and financial position of the concern.
Fixed assets are meant for use for many years the value of these assets
decreases with their use or with time or for other reasons. A portion of
fixed assets reduced by use is converted into cash though charging
depreciation for correct measurement of income, proper measurement
of depreciation is essential, as depreciation constitutes a part of the total
cost of production.

ACCOUNT PAYABLE AND FIXED ASSETS Page 9

 Learning Objective:
1. Accounts payable: -AP is the short term liabilities thata
business owes to any of the outside company stakeholders. Accounts
payable has a lot of importance when you want to run
your business successfully.
The first important reason is that if we don’t exactly know to whom we
owe what we can be fooled by anyone who can receive repeated
payments from us. This usually happens with businesses when there
are no records maintained or the amount is so much that it becomes
extremely difficult to keep a lid on things. Not knowing the exact date
of the payment of an account payable will result into accumulation of
interest on your company only because of the negligence.

Accounts payable are also important for maintaining the cash flows.
When you are dealing with mass purchases, you often can negotiate the
terms of your accounts payable.

2. Fixed Assets: -Fixed Assets plays very important role in relating

company’s objectives the firms to which capital investment vested on
fixed assets. This fixed asset is not convertible or not liquid able over
a period of time the total owner funds and long-term liabilities are
invested in fixed assets. Since fixed assets playing dominant role in
total business the firms has realized the effective utilization of fixed
assets. So ratio contributes very much in analyzing and evaluating the
performance of fixed assets. If firms fixed assets are idle and not
utilized properly it effects long-term sustainability of the firms, which
may affect liquidity and solvency and profitability positions of the
company. The idle of fixed assets lead a tremendous in financial cost
and intangible cost associate to it. So there is need for the companies
to evaluate fixed assets performance. Comparison with similar
company and comparison with industry standards. So chose a study to
conduct on the fixed assets analysis of AISCO corporate using ratio in
comparison with previous year performance. The title of the projectis
analysis on fixed assets.

ACCOUNT PAYABLE AND FIXED ASSETS Page 10

Scope of Study:
For Account Payable: -

• Validate all Account Payable invoices for the month (this is

ongoing).

• Review supplier statements and check all invoices are secondary

approved/or current (i.e., not due for payment).

• Review employee expense claims/advances to ensure they are

up-to-date and processed.

• Review credit card statements to supporting receipts/vouchers

and journal expenditure from the department suspense account
to relevant cost centre.
• Run Invoices on Hold, Report to list invoices placed on hold and
then action all holds, as necessary.

ACCOUNT PAYABLE AND FIXED ASSETS Page 11

 COMPANY PROFILE

Arya Iron & Steel Company Private Limited is a Private Manufacturing

Company located at Matkambeda Industrial Estate, Barbil, Keonjhar,
Odisha-758036, Incorporated on 27 Jul,2004.

Company's authorized capital stands at Rs 3000 lakhs and has 61.81%

paid-up capital which is Rs 1854.31 lakhs. Arya Iron & Steel Company
Private Limited last annual general meet (AGM) happened on 29 Sep,
2021. The company last updated its financials on 31 Mar, 2021 as per
Ministry of Corporate Affairs (MCA).

Arya Iron & Steel Company Private Limited is majorly in

Manufacturing (Metals & Chemicals, and products thereof) business
from last 18 years and currently, company operations are active.
Current board members & directors are NAKUL
RAVINDRAKUMAR ARYA, PUNEET PAWAN ARYA, RAVI
MANIRAM ARYA, DAIZY ARDHENDU THAKUR, SUNIL
KUMAR JAIN, PAWANKUMAR MANIRAM ARYA, GIRISH
SHARMA and VIJAY SHYAMSUNDARMANIYAR.

Company is registered in Mumbai (Maharashtra) Registrar Office.

Arya Iron & Steel Company Private Limited registered address is 51-
53A, MITTAL COURT, NARIMAN POINT, MUMBAI MH 400021
INDIA.

Product & services

MANUFACTURING OF IRON ORE PELLET PLANT

AISCO is operating a 1.2 MTPA Merchant Iron Ore Pellet Plant in Barbil,
Odisha as the region around Barbil has the fifth
Largest deposit of iron ore in the world.
This plant is the largest and first of its kind to use the Grate Kiln Technology in
Orissa.
AISCO cater to both markets; Domestic as well as International.

ACCOUNT PAYABLE AND FIXED ASSETS Page 12

Benefits of Iron Ore Pellets:
1. Stable Blast Furnace Operation.
2. Superior Permeability Due to Size Uniformity.
3. High Blast Furnace Productivity.
4. Lower Coke Rate of Blast Furnace.
5. Better Sponge Iron Quality.
6. Less Fines Generation in Sponge Iron Kiln.
7. Less Handling Losses.
8. Less Specific Consumption of Coal.
9. Increased Campaign Life.
10. Low Refractory Repairing Cost.
11. Overall Lower Cost of Production.
12. Better Environmental Conditions.

ACCOUNT PAYABLE AND FIXED ASSETS Page 13

MANUFACTURING of SPONGE IRON IN TUNNEL KILN PLANT
AISCO has commenced & Produced 0.1 MTPA Sponge Iron-HGPIN
• Tunnel Kiln plant to produce D

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 Benefits of Tunnel Kiln:
• Better control of kiln temperature and heat uniformity.
• Increase production quality.
• The qualitative similarity of products.
• Increase production speed.
• Reduce workers.
• Reducing energy consumption.
• Reducing the harmful effects of the environment.

ACCOUNT PAYABLE AND FIXED ASSETS Page 15

Arya Iron & Steel Company Private Limited
Details

CIN U27100MH2004PTC147715
Date of Incorporation 27 Jul, 2004
Status Active
Company Category Company limited by Shares
Company Sub-
category Private company
Company Class Private
Manufacturing (Metals & Chemicals, and
Business Activity products thereof)
Authorized Capital 3000.0 lakhs
Paid-up Capital 1854.31 lakhs
Paid-up Capital % 61.810173
Registrar Office City Mumbai
Registered State Maharashtra
Registration Number 147715
Registration Date 27 Jul, 2004
Listing Status Unlisted
AGM last held on 29 Sep, 2021
Balance Sheet last
updated on 31 Mar, 2021

ACCOUNT PAYABLE AND FIXED ASSETS Page 16

 RESEARCH METHODOLOGY

1. Research objective: -

Account payable:

My objective is to find out a short-term liquidity measure used

to quantify the rate at which a company pays off its suppliers.
Accounts payable turnover ratio is calculated by taking the total
purchases made from suppliers and dividing it by the average
accounts payable amount during the same period.

Accounts Payable Turnover = 𝑇𝑜𝑡𝑎𝑙 𝑆𝑢𝑝𝑝𝑙𝑖𝑒𝑟 𝑃𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑠

𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐴𝑐𝑐𝑜𝑢𝑛𝑡𝑠 𝑃𝑎𝑦𝑎𝑏𝑙𝑒

The measure shows investors how many times per period the
company pays its average payable amount.

• Study is conducted to evaluate that if fixed assets are liquidated.

What is the proportion of fixed assets amount will contribute for
payment of owner fund and long-term liabilities.

• The study is evaluated is giving adequate returns to the company.

2. Research Methodology: -

Both for FIXED ASSETS and ACCOUNT PAYABLE:

The data used for analysis and interpretation form annual reports of the
company that is secondary forms of data. Ratio analysis is used for
calculation on purpose.

The project is presented by using table’s graphs and with their

interpretations. No survey is undertaken or observation study is

ACCOUNT PAYABLE AND FIXED ASSETS Page 17

conducted in evaluating ‘FIXED ASSETS and ACCOUNT PAYABLE’
performance of AISCO.

3. Limitations: -

ACCOUNT PAYABLE:

• The study period of 42 days as prescribed by university.

• The study is limited unto the date and information provided by

AISCIO and its annual reports.

• The report will not provide exact fixed assets status and position
in AISCO; it may vary from time to time and situation to
situation.
• This report is not helpful in investing in AISCO either through
disinvestments or capital market.

• The accounting procedure and other accounting principles are

limited by the company changes in them may vary the fixed
assets performant.

ACCOUNT PAYABLE AND FIXED ASSETS Page 18

 DOCUMENTS REQUIRED FOR ACCOUNTS
PAYABLE

1. INVOICE

2. PURCHASE ORDER

3. GRIN (GOODS RECEIVED AND INSPECTION NOTE)

4. GRN (GOODS RECEIVED NOTE)

1. INVOICE

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 2. PO (PURCHASE ORDER)

3. GRIN (GOODS RECEIVED AND INSPECTION NOTE)

4. GRN (GOODS RECEIVED NOTE)

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3. GOOD INSPECTION REPORT

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4. GOODS RECEIVE NOTE

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 ACCOUNT PAYABLE PROCESS OF AISCO

Accounts Payables is nothing but a Liability which has to be paid by

the company for the goods that they have purchased or services that
they have availed from a Vendor. The Firm is Accountable or
responsible to pay for the goods purchased or services that they have
availed.

Accounts payable best practices in controlling accounts payable with

the intention of contributing positively to cash flow and bearing jointly
beneficial relationships with suppliers. The hope between a company
and its suppliers seems to be shaken by accounts payable actions there
by upsetting supplier relations. On the other hand, paying your bills on
time improves your relationship with the supplier. An improved
relationship with suppliers is essential to a company since they supply
priceless trade credit, and also offer ideas for new methods and
products, which are considered as important role in customer service.

The procedure of Accounts Payable in AISCO is as follows:

a) Collecting invoices from all section

b) Checking

c) the accuracy of invoices with GRN, PO and also the approval

of the H.O.D

d) Preparing files for processed and un paid invoices for necessary

accounting

e) Writing accounts heads in each invoice

f) Arranging invoices alphabetically and put Document Numbers

g) Entering the bills in to computer and checking all the invoices

accounted as correct or not.
ACCOUNT PAYABLE AND FIXED ASSETS Page 23
 h) Copies of invoices generated in H.O sending to various affiliates

i) Preparing payment advices for each supplier

j) Party reconciliation

k) Proper filing of invoices

l) Checking of GRN list monthly to ensure all the purchase are

entered
m) Proper Bill matching with payment vouchers

n) Preparing monthly expenses details for Trading & Reliance

COLLECTING INVOICES FROM ALL SECTION:

In this step Accounts payable department collect all the
invoices from various branches of AISCO Healthcare.
CHECKING THE ACCURACY OF INVOICES WITH GRN, PO
AND ALSO THE APPROVAL OF THE H.O.D:
In this step employee check the accuracy of GRN and PO
that the amount which GRN and PO is showing is correct and matched
or not. There is one more document is required that is Approval of Head of
Department (H.O.D).
PREPARING FILES FOR PROCESSED AND UN PAID INVOICES
FOR NECESSARY ACCOUNTING:
In this step the employee makes an separate file for the
processed and unpaid invoices. After that, they do proper accounting
treatment for it.

WRITING ACCOUNTS HEADS IN EACH INVOICES:

In this step employee put every transaction in their
prescribed Accounting head.
ARRANGING INVOICES ALPHABETICALLY AND PUT
DOCUMENT NUMBERS:

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 In this step employee put the entire document in the
alphabetical order and put the document numbers on every Invoice.
This helps the employee to find the invoice whenever they need it.
ENTERING THE BILLS IN TO COMPUTER AND CHECKING ALL
THE INVOICES ACCOUNTED AS CORRECT OR NOT:
After all the above steps, in this step the employee put all
the invoice transaction in the computer in their respective accounting
head. After that they have to check that the entire amount which you
accounted is correct or not.
COPIES OF INVOICES GENERATED IN H.O SENDING TO
VARIOUS AFFILIATES:
In this step all the invoices were sent to all the different
branches. In which they cross check all the data that all those data is
accounted correctly. This step is done because this company follows
the centralized control.
PREPARING PAYMENT ADVICES FOR EACH SUPPLIER:
In this step H.O employee makes the payment advice in
Excel sheet. Accordingly, they pay their debt to their suppliers.
Actually it is a Statement on which the Account payable employee
gives advice to the company on how much amount they have to pay to
whom.
PARTY RECONCILIATION:
In this part account payable made the suppliers
reconciliation. In this they make tally their account with the supplier
account or if there is any omission then that value comes under the
Reconciliation Account.
PROPER FILING OF INVOICES:
After the reconciliation next step is to make a proper filing
of all the invoices because in reconciliation we record those values
which is not appear in the supplier or AISCO statement. After
payment of those omitted values proper filing is mandatory.
CHECKING OF GRN LIST MONTHLY TO ENSURE ALL THE
PURCHASE ARE ENTERED:

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 Now, in this step monthly list of GRN is checked with the
Books of AISCO by the Employee to know there is no omission or
wrong entry.

PROPER BILL MATCHING WITH PAYMENT VOUCHERS:

In this step the employee have to match the entire bill with
the payment vouchers.

DIAGRAM FOR ACCOUNTS PAYABLE

Invoice
sent to H.O

st (Whether
1 QC Sent wrong
all invoices belong No invoices to
to related validator

Yes 2nd QC*

Segregate and save (Invoices
invoices in specific saved must
folder for required be equal to
invoices

Invoices approved by validator

(with expense account number
and cost center)

3rd QC*
(Account
Book invoice in
number and cost
accounting software
according to validation center must be
same as given
by validator)

Invoice is
approved
for payment
No

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 Yesby using approved
Make Payment
bank account

QC* = Quality Check

ACCOUNT PAYABLE AND FIXED ASSETS Page 27

 ANALYSIS & PRESENTATION OF DATA AND
INTERPRETATION

ANALYSIS FOR ACCOUNTS PAYABLE:

DEBT TO ASSET RATIO

Explanation of Debt to Asset Ratio:

The Debt to Asset Ratio measures the percentage of the company's

Total Assets that are financed with debt (Total Liabilities). This ratio
basically looks at what debt the company owes, and compares that debt
to what assets the company owns.

Importance of Debt to Asset Ratio:

The lower the Debt to Asset Ratio, the better, as companies with high
amounts of debt introduce more risk. You certainly want to look very
hard at companies that have more Total Liabilities than Total Assets,
as this is a precarious position for a company to be in.

Depending on the industry of the company, you might expect the

company to have two or three times as many assets as liabilities.
Anything less than this might be a signal that the company is running
into trouble.

Debt to Asset Ratio Formula:

Debt to Asset ratio = 𝑇𝑜𝑡𝑎𝑙 𝐿𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠

𝑇𝑜𝑡𝑎𝑙 𝐴𝑠𝑠𝑒𝑡𝑠

Interpreting the Calculator Results:

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If Debt to Asset Ratio increases over time:
An increasing Debt to Asset Ratio means the amount of debt the
company has compared to its assets is increasing, which can be a bad
sign.

If Debt to Asset Ratio decreases over time:

A decreasing Debt to Asset Ratio means the amount of debt the
company has compared to its assets is shrinking, which is generally a
good sign.

If Debt to Asset Ratio stays the same over time:

An unchanged Debt to Asset Ratio means the amount of debt the

company has compared to its assets has remained the same.

ACCOUNTS PAYABLE TURNOVER RATIO:

The accounts payable turnover ratio indicates how many times a

company pays off its suppliers during an accounting period. It measures
how a company manages paying its own bills. A higher ratio is
generally more favorable as payables are being paid more quickly.
When placed on a trend graph accounts payable turnover analysis
becomes simplified: the line raises and lowers just as the ratio does.
Common adaptations used to calculate accounts payable turnover yield
results like accounts payable turnover ratio in days, Accounts Payable
turnover in days, and more. A useful tool in managing and measuring
the efficiency of paying bills is a Flash Report.

ACCOUNTS PAYABLE TURNOVER RATIO FORMULA:

A solid grasp of the accounts payable turnover ratio formula is of

utmost importance to any business person. Though some ratios may
or may not apply to different business models everyone has bills to
pay. The need to understand Accounts Payable turnover is universal.
Accounts payable turnover = Cost of goods sold / Average accounts
payable
ACCOUNT PAYABLE AND FIXED ASSETS Page 29
Or = Credit purchases / average accounts payable.

Purchases = Cost of goods sold + ending inventory - beginning

inventory.

ACCOUNTS PAYABLE TURNOVER CALCULATION:

Accounts payable turnover is calculated by dividing total purchases

made from suppliers by the average accounts payable amount during
the same period.
Average Accounts payable is the average of the opening and closing
balances for Accounts payable.

In real life, sometimes it is hard to get the number of how much of the
purchases were made on credit. Investors can assume that all
purchases are credit purchase as a shortcut. When this is done, it is
important to remain consistent if the ratio is compared to that of other
companies

INTERPRETATION:

This ratio represents how much time a company takes to pay off its
suppliers. According to this ratio, AISCO takes 18 days to pay off its
suppliers. This shows a good sign for the company as they pay off
their supplier this quickly.

Long Term Debt to Total Asset Ratio:

Definition of Long Term Debt to Total Asset Ratio

Long Term Debt to Total Asset Ratio is the ratio that represents the
financial position of the company and the company’s ability to meet all

ACCOUNT PAYABLE AND FIXED ASSETS Page 30

its financial requirements. It shows the percentage of a company’s
assets that are financed with loans and other financial obligations that
last over a year. As this ratio is calculated yearly, decrease in the ratio
would denote that the company is fairing well, and is less dependents
on debts for their business needs.
Formula for Long Term Debt to Total Assets Ratio

The formula to ascertain Long Term Debt to Total Assets Ratio is as

follows:

Long Term debt to Total Assets Ratio = Long Term Debt / Total
Assets

Interpretation:

The higher the level of long term debt, the more important it is for a
company to have positive revenue and steady cash flow. It is very
helpful for management to check its debt structure and determine its
debt capacity. It also shows how many assets of your company are
finances with the help of debts. To calculate long term debt to total
assets ratio you need to add together your current and long term debts
and sum up the current and fixed assets and divide both the total
liabilities and the total asset to get an output in percentage form.
The output is the assets that are financed by the debt financing while
the other half is financed by the investors in your firm. Having the long
term debt to total asset ratio as a high percentage should be worrying
factor for the firm and the company should look in to it and determine
the reason of the high percentage and try to minimize it as much as
possible. The high value would mean that your company needs to have
a good cash inflow to meet all the expenses.

Long Term Debt to Total Asset Ratio therefore provides a measurementto

the investor regarding the percentage of a company’s assets which are
financed with the help of loans or debts for a period lasting over a year.

ACCOUNT PAYABLE AND FIXED ASSETS Page 31

 FINDINGS

Finding for Accounts Payable

• Company’s debt has compared to its assets is shrinking, which

is generally a good sign.

• AISCO takes 18 days to pay off its suppliers, this shows a good
sign

FROM THE ABOVE STUDY IT CAN BE SAID THAT THE AISCO

FINANCIAL POSITION ON FIXED ASSETS IS QUITE SATISFACTORY.

ACCOUNT PAYABLE AND FIXED ASSETS Page 32

 SUGGESTIONS & RECOMMENDATIONS:

Suggestion and Recommendation for Accounts Payable are as follow:

• The company should adopt the automatic recording of Accounts

payable entries

• The company should adopt the decentralized way of recording

Accounts payable entries.
Lesson Learnt: -

During my internship tenure I have done the following activities

1. Vendors/Suppliers Invoice Verification
2. Entering of the Transaction in ERP System
3. Learn the procedure for preparation of Cheque
4. Learn the maintenance of bank book & Cash book
5. Reconciliation of Vendors
6. Analyzing the Trial Balance

• Invoice Verification
Invoice verification is making sure whether the vendor/Supplier is
charging customers for what the customers availed. It is done by
cross-checking the invoices received against the purchase order/Work
Order and delivery receipt placed with emphasis given to prevailing
tax matters like GST, TCS & TDS on Goods/Services as per statute.
An invoice is paid only if the invoice details match the supporting
documents.
And if the invoice has any discrepancies, it is rejected and the vendor
is requested for the correct invoice.
Generally, companies have dedicated accounts payable managers who
are authorized to verify and approve an invoice payment.
The Invoice Processing Procedure
1. Check Invoice Accuracy
2. Confirm the Invoice Date
3. Confirm the Delivery with the User dept.
4. Check the Vendor Information
5. Mark Invoice Due Date
ACCOUNT PAYABLE AND FIXED ASSETS Page 33
 6. Schedule the Payment

• Recording of Transactions in ERP:

The ERP finance module is the software component that handles the
main accounting and financial management functions of an Enterprise
Resource Planning system. It contains standard accounting records,
such as the general ledger (GL) and balance sheet; generates financial
reports; and handles related transactions, such as invoicing and
expense reporting. The ERP finance module, which is also referred to
as ERP core finance or financial management.
ERP is modular software designed to integrate an organization's
business processes into a single system running on a central database.
The finance module shares data with other departments for better
coordination of work fulfillment.
AISCO is using ORION ERP.

• Preparation of Cheque:
Cheque:-
The Cheque is an instrument with an unconditional
order, addressed to the banker. It is signed by the person who has
deposited cash in the bank. A Cheque can be issued for a current
account or the savings account and can be used to deposit or pay
money to other people through the bank account.
What are the Parts of a Cheque?
• Bank's information- The Cheque carries the name of the bank
and its address.
• IFSC- It is a unique 11-digit code, which is a combination of
numerals and alphabets.
• Payee information- The payee's name must be properly
mentioned here.
• Date box- Fill in the date, month, and year in this box.

• Reconciliation of Vendor/Supplier and GL Transactions:

It is the process of checking the entity’s payables to vendor account
balance and vendor outstanding balance. Reconciling vendor
statements enables a business to ensure no inaccuracy or mistake

ACCOUNT PAYABLE AND FIXED ASSETS Page 34

between what the vendor has charged and the supplies, inventory, or
services received by the company.
Performing general ledger reconciliations helps to increase accuracy,
prevent significant errors, and identify adjustments in a timely manner.
Vendor Reconciliation Process:
1. Checking the Opening Balances
2. Inspecting Line Items
3. Differences-Time difference, errors and omissions
4. Ensuring Accuracy
5. Payments, Debit & Credit Notes

• BANK RECONCILIATION:
A bank reconciliation statement is a document that compares the cash
balance on a company’s balance sheet to the corresponding amount on
its bank statement. Reconciling the two accounts helps identify whether
accounting changes are needed. Bank reconciliations are completed at
regular intervals to ensure that the company’s cash records are correct.
They also help detect fraud and any cash manipulations.
Bank Reconciliation Procedure
1. On the bank statement, compare the company’s list of issued
cheques and deposits to the cheques shown on the statement to
identify uncleared cheques and deposits in transit.
2. Using the cash balance shown on the bank statement, add back
any deposits in transit.
3. Deduct any outstanding cheques.
4. This will provide the adjusted bank cash balance

ACCOUNT PAYABLE AND FIXED ASSETS Page 35

 CONCLUSION

Conclusion for Accounts Payable:

By using this Account Payable System user can get following items.

• Discover the latest timesavers for processing payables

• It is more effective internal controls for reducing duplicate

payments, fraud and wasteful spending

• Turn your AP department into a profit center!

• Streamline the entire payment process with simple techniques –

and dramatically boost your efficiency

• Build safety nets into your processing system that guarantee bills
get paid on time

ACCOUNT PAYABLE AND FIXED ASSETS Page 36

 REFERENCES/BIBLIOGRAPHY

www.wikipedia .com

www.Investopedia.com

http://www.heka-finance.com/

http://www.accountingtools.com

https://www.aisco.co.in/

ACCOUNT PAYABLE AND FIXED ASSETS Page 37