WELCOME TO THE

PRESENTATION
American International University-
Bangladesh (AIUB)
PREPARED BY
Name: Md. Jubair Hossain
ID: 05-05344-1
First Major: Management Information system (MIS)
Second Major: Accounting & Finance
Degree: Bachelor of Business Administration (BBA)
The Implementation of Accounting Principles
in the Financial Practices of Alex LTD
Topic of this Presentation
Introduction
This presentation is based on the report that has been
prepared to fulfill the requirement of Internship course of
Business Administration Program of American International
University-Bangladesh (AIUB). The main aim of this report is to
find out the financial policies of Alex Ltd. and compare them with
the standard accounting principles. Standard accounting principles
are those which are used to ensure clarity, uniformity, consistency
and accountability of accounting information. The problem will be
that, in real life, financial information are not arranged in such an
order to measure the extent how far these principles are being
really followed. But standards are necessary because they provide
organizations something to achieve for.
Organization overview
The Alex Ltd. has founded in August of 1996 as a fastening
products company. Since then it has crossed along path
establishing five garments organizations in the country. ALEX LTD
was established in 7th November as the local branch of the ALEX
group. The factory in DEPZ (Dhaka Export Processing Zone)
started production in February 2003 through its own factory. At
2006 started manufacture garments in their second unit and at
2007 they started 3 sub units at different location. Recently they
will launch an automated brick field in Mymenshing.
Objectives
The objectives of the report can be categorized in two classes:

Broad Objective: To present a relative study between
standard accounting principles and that of the company.

Specific Objectives:
To give an overview of the company
To introduce the various products launched by Alex
Ltd.
To provide an outline of the accounting standards
To analysis the financial performance analysis
To compare between company procedures and the
standards
Limitations of the Study
Time frame for the research is limited. The adoption to the
organization takes a lot of time.
Large-scale research was not possible due to constraints and
restrictions posed by the organization.
The report was written from an individuals perception. So, all
the findings might not be objective.
Getting Relevant papers and documents have been extremely
difficult.
To protect the organizational confidentiality, some parts of the
report will be edited.
The management seems to get woks out of the intern rather
than helping in the academic pursuit.
Methodology of the study
In this study, exploratory research has been undertaken to
gain insights about company procedures and practices. Also both
the primary as well as the secondary form of information was used
to prepare the report.

Research design: As an Exploratory Research, this report
will briefly reveal the overall activity of Alex Ltd. and also analyzes
the The Implementation of Accounting Principles in the Financial
Practices of Alex LTD. In this report data have been collected
from both primary and secondary sources.
Methodology cont.

Primary Sources:
Oral interview with various officers of the company
Accounting records- vouchers, journal, ledgers etc; both in
electronic and paper
Company manuals

Secondary Sources:
Various accounting related books and periodicals
Bangladesh Accounting Standard guide
Website information
Analysis of the study
The internship report entitled - "The Implementation of
Accounting Principles in the Financial Practices of Alex Ltd." will
discuss about financial performance applies in the Alex Ltd.

Ratio analysis: This analysis will show some ratio analysis
that has been done based on the companys annual report.
Analysis cont.
Return on assets
0.14
0.13
0.11
0.12
0
0.02
0.04
0.06
0.08
0.1
0.12
0.14
Ratio
2009 2008 2007 2006
Years
Return on assets
2009
2008
2007
2006
Return on assets ratio is showing good return on the total assets.
Analysis cont.
Coverage ratio
Coverage ratio is showing poor performance than last three years
against interest and bank charges.
1.53
2.25
1.77
1.69
0
0.5
1
1.5
2
2.5
Ratio
2009 2008 2007 2006
Years
Coverage ratio
2009
2008
2007
2006
Analysis cont.
0.15
0.16
0.14
0.15
0.13
0.135
0.14
0.145
0.15
0.155
0.16
Ratio
2009 2008 2007 2006
Years
Return on shareholders' equity
2009
2008
2007
2006
Return on shareholders equity
Net income has been decrease in 2009 than the last year against
the equity of shareholders.
Analysis cont.
Inventory turnover
7.26
4.47
6.13
6.92
0
1
2
3
4
5
6
7
8
Ratio
2009 2008 2007 2006
Years
Inventory turnover
2009
2008
2007
2006
Inventory management system is very good in 2009 than the last
three years.
Analysis cont.
Days of sales in inventory
5.62
9.84
6.46
7.04
0
2
4
6
8
10
Ratio
2009 2008 2007 2006
Years
Days of sales in inventory
2009
2008
2007
2006
This ratio is unexpectedly lower than the last year. The higher
value can be achieve when, for perishable goods, the value
become low; and the value of durable goods become higher.
Analysis cont.
Current ratio
1.21
1.83
1.38
1.65
0
0.5
1
1.5
2
Ratio
2009 2008 2007 2006
Years
Current ratio
2009
2008
2007
2006
The company is maintaining a sufficient amount of current assets
in order to sustain their daily need.
Analysis cont.
Inventory to net working capital
2.38
1.12
1.88
1.47
0
0.5
1
1.5
2
2.5
Ratio
2009 2008 2007 2006
Years
Inventory to net working capital
2009
2008
2007
2006
The ratio of 2009 is showing that the company has been able to
fulfill its short term financial obligations very well than last year.
Analysis cont.
Debt-to-asset ratio
0.71
0.55
0.64
0.61
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
Ratio
2009 2008 2007 2006
Years
Debt-to-asset ratio
2009
2008
2007
2006
Judging the ratios of four years, the year 2009 have the highest
value, means shareholders have contributed a less portion of the
funds to the business than last three years.
Analysis cont.
Debt-to-equity ratio
0.81
0.75
0.79
0.76
0.72
0.74
0.76
0.78
0.8
0.82
Ratio
2009 2008 2007 2006
Years
Debt-to-equity ratio
2009
2008
2007
2006
The ratio of four years shows that, in 2009 the debt-to-equity ratio
become very high. Therefore company had grater reliance on
creditors that last three years.
Findings
The company uses a combination of manual and computerized financial
information system to record, collect, analyze and report financial
information.
Financial performance is good and intended to achieve more. As a result,
performance of the company increases and with it companys brand image
also get brighten.
A higher ratio result than industry standards usually indicate an efficient
use of assets.
Though managers and executive officers know a great deal about the
financial concepts used, many of the supervisory employees do not
understand their importance. This sometimes results, not to paying
enough attention to the details creating misunderstanding.
Findings cont.
A high turnover rate is an indication of good inventory management as the
appropriate amount of inventory is being purchased to meet demand. High
turnovers are also a good indicator that the business is less.
Most of the orders come from foreign country.
In general all assets run twice in a year but this company in competitive
market ratio is not satisfactory.
Where I have done my internship they facing worker conflict and also they
facing less order from buyer.
Garments sector is contributing a major portion to our economic growth.
But in this sector today they are facing lots of problem.
Suggestions
Not only managers and officials, but the supervisors and senior workers
should have an idea about importance of the financial reporting. So, some
sort of basic training financial on should be arranged for them.
To discourage workers from deliberately not collecting their dues in time, a
minor charge should be cut from their dues after a fixed numbers of days.
This will psychologically motivate workers to gather their wages in time
and relieve the pressure on the pay-roll accounting because company
should not face liquidity problem.
There must be a clear allocation of responsibilities authority and
accountability.
Suggestions cont.
The company should take the initiative to develop an effective research
and development center to get innovative ideas to capture the competitive
market.
The company has the provision of internship program but there is no
organized structure for the internship program. The company can properly
utilize the internees at minimum cost.
The company should go for advertising about their company and the up
coming brand. So that the customer knows what types of products and
designs they are providing.
Conclusion
At last it can be said that Alex Ltd. has built its organizational
accounting procedures around standard accounting principles. This
results into the better financial performance of the company. The
management needs to have accurate financial information.
Accounting procedures based standard accounting principles
ensure that the management gets it on time.
END OF THE
PRESENTATION