Declaration
Declaration
I hear by declare that the project work entitled Financial Planning and Forecasting
submitted to Sidho-Kanho-Birsha-University, MBA Department is a record of an original
work done by me, Roll - 86310022 No- 0036 under the guidance of Prof. Krishna Dayal
Pandey, faculty of M.B.A Department, SKBU for the internship report of third semester
during Jharna Resort, Purulia and this project work is submitted in the partial
fulfilment of requirements of Master of Business Administration, SKBU the results
embodied in this thesis have not been submitted to any other university or Organization .
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CERTIFICATE
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ACKNOWLEDGEMENT
Firstly, I would like express my gratitude to Sidho Kanho Birsha University for including
internship program which has provided an opportunity to gain practical working experience
in the organization.
On my report about internship period, it's my Privilege to thank for all the people who
contributed to make this period a great experience for my life, I am thankful to Miss Amisha
Sarkar Advisor & CEO at Jharna Resort for providing me this golden opportunity to work
within a recognized organization with friendly environment.
I would like to thank my Head of Department Dr. Pradipta Banerjee for his constructive
criticism throughout my internship.
I would also like to extend special thanks to the entire staff for their full co-operation
guidance and support during my internship.
I convey my sincere gratitude to my academic Prof. Dr. Krishna Dayal Pandey, Dr. Jagannath
Ghosh, Dr. Srimoyee Datta without their kind direction and proper guidance this report has
been a little success. In every phase of the project their supervision and guidance shaped this
report to be completed perfectly
Date: Signature:
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PREFACE
This report contains the internship period I had at Jharna Resort as a trainee finance
department.
Jharna Resort has provided that training ground for me. In 45 Days of my internship
I got view of organization work and process.
It was a good experience and I tried to make most of this opportunity to explore and
learn.
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ABSTRACT
The goal of this study is to study the financial activities of how the accounts department of
Jharna Resort is conducted.
Financial Planning and Forecasting is the estimation of value of a variable or set of variables
at some future point. A Forecasting exercise is usually carried out in order to provide an aid
to decision – making and planning in the future. Financial planning and forecasting represent
a blueprint of what a firm proposes to do in the future. So, naturally planning over such
horizon tends to be fairly in aggregative terms. While there are considerable variations in the
scope, degree of formality and level of sophistication in financial planning across firms, we
need to focus on common elements which include Economic assumptions, Sales forecast, Pro
forma statements, Asset requirements and the mode of financing the investments.
In general usage, a financial plan can be a budget, a plan for spending and saving future
income. This plan allocates future income to various types of expenses, such as rent or
utilities, and also reserves some income for short-term and long-term savings. A financial
plan can also be an investment plan, which allocates savings to various assets or projects
expected to produce future income, such as a new business or product line, shares in an
existing business, or real state
Financial forecast or financial plan can also refer to an annual projection of income and
expenses for a company, division or department. A financial plan can also be an estimation of
cash needs and a decision on how to raise the cash, such as through borrowing or issuing
additional shares in a company.
The various tools used for this report are discussed below and I have summarized my overall
experience with my learning and challenges faces are discussed below.
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EXECUTIVE SUMMARY
The Jhara Resort brand in debuts in Purulia, West Bengal with the opening of Jharna Resort.
This Resort is the latest addition to the portfolio of Resorts that are well recognized as
gathering places for local communities to celebrate everyday occasions. Backed by long
history, the brand presently has a footprint in Purulia, West Bengal. I have done my
internship in Finance Department at Jharna Resort and my topic is financial planning and
Forecasting Method.
A finance department is the unit of a business responsible for obtaining and handling any
monies on behalf of the organization. The department controls the income and expenditure in
addition to ensuring effective business running with minimum disruptions.
I have done internship in this organization due to my interest in finance, so I got a lot from
this internship about finance as a whole and audit specifically.
This was my first working experience in the hotel & resorts industry. My position was
finance trainee , overall it was an excellent experience regarding to learning face to face
conversation.
During my internship period my position was held in the finance department as a trainee
where my duties and responsibility was to finance intern usually works under the supervision
of the business services division management and must follow the accounting or auditing
process
During my stay I have not only learned about the financial cycle or procedure but also got the
overall knowledge of finance sector.
In my report, I mostly tried to uphold all finance activities and process which Iwas
followed by Jharna Resort.
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Table of Content
1. Cover Page 1
2. Declaration 2
3. Certificate 3
4. Acknowledgement 4
5. Preface 5
6. Abstract 6
7. Executive Summary 7
9. Introduction 16-19
15. Bibliography 35
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1.
COMPANY
PROFILE
Fig. 1
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Jharna Resort
Jharna Resort is a new resort, set up in 2023 to cater to the mid priced market segment in
business and leisure destinations, it is today a professional Hotel Management company, with
its new outface it promise to serve in various stages of completion.
Jharna Resort is operating in Purulia with a wide spectrum and offer various amenities such
as Room stay, Villa stay, Resturant, lounge, banquet. ‘Jharna Resort’ representing a ‘stylish
lifestyle with efficient personalized service’, is the latest addition to the bouquet of brands.
It is located in the outskirt of Purulia Town which is 1 km from Purulia Railway Station, its
location is ‘Deer park Road, Surulia, Purulia’
Fig.2
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ORGANIZATIONAL STRUCTURE OF JHARNA RESORT
GM
MD CEO
OM
Fig. 3
House Keeping
Banquet
Fig. 4
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Vision
Jharna Resort vision statement is ―to become the premiere provider and facilitator of leisure
& vacation experiences in the Region. Leading from the front is exactly what Jharna Resort
emphasizes in this statement. The company shows its determination to be a primary
influencer in the sector through differentiated services and experiences for all its customers.
Mission
Jharna Resort mission statement is ―to enhance the lives of our customers by creating and
enabling unsurpassed vacation and leisure experiences.” The benefits that the customers get
by choosing Jharna Resort as their preferred destination is primarily the focus of this mission
statement. In fact, the mission statement comes out as a vow that they should expect nothing
short of excellent services. The following characteristics make up this mission statement.
In the mission statement, Jharna Resort implies that the first priority of this company is to
enhance its customer’s lives. The enterprise has put in place a variety of packages for the
customers to choose from, and each is accompanied by distinguished on-demand services. At
Jharna, all the customers have to do is make their preferential choices, and leave the rest to
the able and professional expertise to make their lives there memorable and enjoyable.
Values
Jharna Resort core values include ―we put people first, we pursue excellence, we embrace
change, we act with integrity, and we serve our Nation. ― With these core values, Jharna
Resort has done what many hospitality companies have failed to do – establish an internal
corporate culture that works for the overall growth of the firm. In fact, this is what has made
it so easy for Jharna Resort to remain in line with its missionand vision statements.
Slogan
"Take care of associates and they will take care of the customers."
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Swot Analysis of Jharna Resort
Sheraton Threats
1. Competitive pressure
2. Industry is highly dependent upon nation economic conditions
3. Constant need to reinvent customer service.
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Competitor Information
1. Sagar Raj Resort
Sagar raj Resort located in NH314, Purulia, West Bengal is marked as 4-star category hotel &
resorts, have acquired a great brand image and loyalty for more than 10 years.
Kushal Palli began it dream of serenity retreat with 82 exclusive cottages. This dream has
expanded to encompass 103 exclusive rooms now.
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The Eco Adventure Resort is one of the ambitious projects of owner family. After being in the
entertainment business for more than a decades, this is their most recent foray into
ecotourism. This resort is also recognized by Ministry of Tourism, Govt. of India in the
category of Recommended.
5. Mili Resorts
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2.
Introduction
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A Study on Financial Planning & Forecasting at Jharna
Resort:
One of the key demanding conditions facing businesses in recent times is the ability to
plan for the future and to predict jogging performance. An effective, timeous and
accurate budgeting, forecasting and economic planning technique offers companies a
possibility to put together for and be in a feature to attain a rapidly changing corporation
environment. Companies which can update plans and forecasts rapid are in a better
feature to take benefit of possibilities and respond to threats (Stretch, 2009: 90).
Planning, forecasting and variance evaluation are control accounting gadget that may assist
businesses benefit a greater intensive fact of the enterprise in which they operate. Over
time, the data is subtle and this equipment can in the end add fee to the organizations’
strategic decision-making approach. Achieving true cost thru the financial planning
manner depends on some of factors, namely:
Organizations need to carefully do not forget the monetary surroundings in addition to take
cognizance of the various internal and external factors which may also have an effect on
its operations. According to Botten (2008: 42) enterprises should maintain a weather- eye
on its surroundings, watching out for emerging possibilities and threats. Each enterprise
has its personal set of challenges and possibilities that enterprises have to do not forget in
their strategic making plans. Therefore, budgeting and forecasting have to don't forget
these fashionable and industry-specific opportunities and threats.
A corporation’s attitude towards planning is important, buy-in from the whole corporation
should be obtained in order for the method to add price and to be effective. Stretch (2009:
89) argues that many managers are harassed with making plans structures evolved years
in the past in a relatively static, easy to understand, commercial age. This kind of
organizational state of affairs at a managerial level could result in negativity and a loss of
buy-in to the making plans manner. Other motives for grievance and lack of buy- in are
highlighted by way of Collier & Agyei-Ampomah (2007: 39 - 40) as follows, budgets.
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Function of Finance Department at Jharna Resort:
Finance Department is one of the most important departments at Jharna Resort. This
department is merely responsible to keep a check on the operation happening inside and
outside the Jharna Resort.
This department is responsible for the accounting for product purchases, hospitality and
costing and product profitability analysis in addition to that it also accounts the
transshipments and sales that are made through so many companies. This department also
manages audit yearly and conduct analysis of new business opportunities that arises in
the country. another major function of this department is to set target for every year . Whole
department is subdivided into 3 divisions purchasing, inventory, and pricing. In purchasing
we have hospitality income as well.
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The three commonly used methods for preparing the pro forma
Financial Planning at Jharna Resort
Percent of Sales Method
The percent of sales method for preparing pro forma financial statement are fairly
simple. Basically this method assumes that the future relationship between various
elements of costs to sales will be similar to their historical relationship. When using
this method, a decision has to be taken about which historical cost ratios to be used.
Variation Method
Variation method on the other hand, calls for estimating the items on the basis of
percentage increase or decrease of comparing with the same item of base year. It
is quite flexible throughout the future period. This method is not like budgeted
method,the value estimating for an item under this method is entirely dependent on the
historical data.
Combination Method
It appears that a combination of above explained three methods works best. For certain
items, which have a fairly stable relationship with sales, the percent of sales method is
quite adequate. For other items, where future is likely to be very different from the
past, the budgeted expense method or variation method is eminently suitable. A
combination method of this kind is neither overly simplistic as the percent of sales
method nor unduly onerous as the budgeted expense method or variation method.
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3.
Literature
Review
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Lancaster G.A.& Lomas R.A. (1985)
E.Thomson (2018)
There is general agreement in many forecasting contexts that combining individual
predictions leads to better final forecasts. Conversely, the relative error decrease in
a combined forecast depends upon the extent to which the component forecasts
contain unique/independent evidence. Tactlessly, obtaining sovereign predictions
is difficult in many situations, as these forecasts may be based on similar statistical
models and or overlying information. The current study addresses this problem by
incorporating a measure of coherence into an analytic evaluation framework so that
the degree of independence between sets of forecasts can be identified easily. The
outline also decomposes the performance and coherence measures in other to
explain the underlying aspects that are responsible for error reduction. The
framework is confirmed using UK retail prices index inflation forecasts for the
period 1998- 2014, and inferences for forecast users are discussed.
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Taub (2018)
Tried to ascertain the factors influencing a firm’s choice of a debt equity ratio. For
this study a total of 89 firms form Unites States were chosen randomly over a
period of ten year from 1960 to 1969 and the likelihood-ratio statistics and t-test
were used test the hypothesis described therein. The realistic results of the study
in terms of the expected sign of co-efficient were varied the return to the firm, long
term rate of interest size of the firm revealed appositive influence on the firm’s
debt equity ratio as per the expectation. The effect of tax rate on debt equity ratio.
In real life project evaluation tasks, for making smart financial decisions, it is not
desired to consider all of the factors that might happen to impact the project, but
selecting the right scope for the same is necessary to come up with a
dependableset of financial forecasts. For example, as shown by the existing
literature, the first question that needs answering is the “time horizon of the
analysis”. Once the schedule of the WBS (“Work Breakdown Structure”), as
associated with any project is determined, the following parameters would have to
be affixed, “quantity, value and the timing of occurrence of various goods,
services and costs as part of the project activities” for initiating the forecasting
process. By technical definition DCFR (“Discounted Cash Flow Rate”), is the
interest rate required toturn the summation of the present value of the project
investment exactly the same as the total of the present values of each of the project
year’s “net cash flows”
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4.
Research
Methodology
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Statement of Problem:
A study of Financial Planning & Forecasting at Jharna Resort is to understand the
system and methods of Planning at Jharna Resort. Yes, our behavior towards our
finances is a crucial aspect of optimum financial planning. Social, cognitive, and
emotional factors play an important role in financial decisions. Sometimes, they
make us behave in a manner that is not in the best interests of our financial status.
Primary aim of financial planning is the plan needed for estimating the fund
requirements of a business and determining the sources for thesame. It essentially
includes generating a financial blueprint for company’s future activities. It is
typically done for 3-5 years-broad in scope and generally includes long- term
investment, growth and financing decisions.
Need of study:
Today, cloud-based systems are becoming the standard, providing more flexibility,
security and cost savings — helping organizations generate accurate predictions
and budgets with fewer errors.
But despite these advancements, businesses are still quite dependent on traditional
spreadsheets. Seventy percent of businesses say they rely heavily on spreadsheet
reporting, with only 16 percent using on-premise specialist software - and only
ten percent using cloud software for planning.
Many businesses still base their strategy on annual plans and budgets, which is a
management technique developed over a century ago. But in today’s more
competitive environment, organizations are realizing that plans, budgets and
forecasts need to reflect current reality — not the reality of two, three or more
quarters ago. Continuous planning and rolling forecasts are becoming widely used
methodologies to update plans, budgets and forecasts frequently throughout the
year, on a quarterly or even monthly basis. These approaches help managers spot
trends before their competitors — helping them make better informed, more agile
decisions about pricing, product mix, capital allocations and even staffing levels.
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Data Collec on Technique:
The subordinate data are those which have already been collected by some other
agency and which have already been handled. the sources of secondary data are
yearly reports, browsing internet, through fortnightlies.
Internet
Mazarines
Objective of Study:
This Project based on various Finance strategies used in financial planning and forecasting
process understand the financial position of the company, refers to the development of long-
term strategic financial plans that guide the preparation of short-term operating plans and
budgets, which focus on analyzing the pro forma statements and preparing the cash budget
(1) To make available the adequate funds for business so that they can be used up
to the optimum point.
(2) To collect the funds at a time when the cost of capital is minimum, considering
the investors who are willing to bear risk.
(3) To bring flexibility in planning so that adjustment in the capital structure can
be made with the changing circumstances.
(4) To make the financial plan simplified according to the objectives of the plan.
These objectives act as standards on the basis of which financial decisions can be evaluated.
Which object is more important and which is less important, depends upon the actual
circumstances. Financial plan should be evaluated from time to time so that an equilibrium
in its main objectives is maintained.
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Two Roles of Finance Teams:
Finance Manager
Work closely with the leadership team to formulate short- to long-term
financialand strategic plans.
Analyze financial and operational results to better understand the company's
overall financial health.
Evaluate previous budgets and collaborate with business unit leaders to build
theirannual budgets and forecasts.
Produce models to project long-term growth, accounting for factors that will
impact performance.
Provide detailed analysis and commentary on the performance of a product
ordepartment.
Communicate results and recommendations to senior management that will lead
torevenue generation, cost reduction and more efficient operations.
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5.
Analysis &
Interpretation
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Analysis and interpretation of financial Planning & Forecasting are an attempt to determine
the significance and meaning of the financial data so that a forecast may be made of the
prospects for future earnings, ability to pay interest, debt maturities, both current as well as
long term, and profitability of sound dividend policy.
The main function of financial analysis is the pinpointing of the strength and weaknesses of a
business undertaking by regrouping and analysis of figures contained in financial statements,
by making comparisons of various components and by examining their content. The analysis
and interpretation of financial statements represent the last of the four major steps of
accounting.
According to the study the first three steps involving the work of the accountant in the
accumulation and summarization of financial and operating data as well as in the
construction of financial statements are:
The fourth step of accounting, the analysis and interpretation of financial budgeting,
Forecasting, results in the presentation of information that aids the business managers,
investors and creditors.
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Plest Analysis of Study
PEST Analysis is a strategic framework used to evaluate the external environment for a
business by breaking down opportunities and threats into Political, Economic, Social, and
Technological factors. PEST analysis can be an effective framework to use in Corporate
Strategy Planning, useful in identifying the pros and cons of a Business Strategy. Below we
break down each of the 4 Factors of PEST – Political, Economic, Social, Technological.
Fig. 11 (PEST)
Political Factors
When looking at political factors, you are looking at how government policy and actions
may affect the economy, as well as the specific industry the business operates in. These
include the following:
Tax Policy
Labor Law
Environmental Law
Trade Restrictions
Tariffs
One of the reasons that elections tend to be a period of uncertainty for a country is that
different political parties have diverging views on economic policy. The P in PEST
analysis stands for Political!
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Economic Factors
Economic Factors take into account the various aspects of the economy, and how the
outlook on each area could impact your business. These economic indicators are
usually measured and reported by Central Banks and other Government Agencies.
Often these are the focus of external environment analysis. The Economic outlook is
of extreme importance for a business, but the importance of the other PEST factors
should not be overlooked.
Social Factors
PEST analysis also takes into consideration social factors, which are related to the
cultural and demographic trends of society. Social norms and pressures are key to
determining a society’s consumerist behavior. Factors to be considered include the
following:
Cultural Aspects
Health Consciousness
Population Growth Rates
Age Distribution
Career Attitudes
Technological Factors
Technological Factors are linked to innovation in the industry, as well as innovation within
the overall economy. Not being up to date on the latest trends ofa particular industry can be
extremely harmful to operations. Technological Factors include the following:
R&D Activity
Automation
Technological Incentives
The rate of change in technology
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6.
Suggestions &
Recommendation
31
Although Finance activities of Jharna Resort is great The most important
recommendation for financial plan preparation is to confirm to key accounting
norms and industry standards. These include generally accepted accounting
principles (GAAP) and international financial reporting standards (IFRS). Besides
GAAP and IFRS, other edicts include U.S. Securities and Exchange Commission
guidelines. By law, accountants must display financial items in a specific way
when presenting accounting data. For example, they must show assets distinctly
from liabilities in a balance sheet. Similarly, they must separate revenues from
expenses in an income statement.
i. Determine the financial resources required to meet the company’s
operating programme
iii. Develop the best plans to obtain the required external funds
Expert Recommendations
Many specialists help businesses make sense of the tools involved in financial
plan forecast preparation and presentation, as well as the types of expertise
necessary to use them effectively. These experts include certified public
accountants, financial consultants and investment bankers. External advisers
enable a company to decide which strategy might be most helpful in its
bookkeeping and reporting processes.
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7.
Conclusion
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Generalizing the consequences of the author’s research presented within the
article the following conclusions are drawn:
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Bibliography
Basic details used in this project is from personal experience during the internship.
Reference website:
www.wikipedia.org
www.rcg.in
www.mapsofindia.com
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