Pages

Hectic day on a Valentines Day

Today was a hectic day for me. The morning started with attending the Startup Saturday meeting in IIM, Bangalore (thanks to NSRCEL for hosting the event. For those who are not aware of what Startup Saturday, let me tell you that it is an initiative taken by Headstart ( Headstart.in) to provide entrepreneurs a monthly forum. Startup Saturday provides a forum for entrepreneurs to discuss, present, network and learn from peers, prospective customers, adopters, partners and investors. (For more information click HERE).

Today's session started with a brief introduction on how NSRCEL (nsrcel.org) helps the budding entrepreneurs, followed by a presentation by Sumeet Anand, founder of Kreeo. Sumeet explained about Collective Intelligence and said Kreeo is an user-driven collective intelligence and semantics based Knowledge Management platform. It can serve an individual as well as an enterprise. For more details, you can visit their site (www.kreeo.com).

Then Jyotsna presented her venture (Moovieshoovie.com). The concept was good and she mentioned that moovieshoovie will get the film's rights and load on to their site and the users can view the film at their leisure. The films will be streamed and can be paused and resumed at any stage.

We had a coffee break and business networking (I need to be clear, as it was a valentine day) happened during the break.

After the break, Yusuf took us through the SMS based voice services. He spoke about the advantages of using Voice PHP over Voice XML. I am not a techie to understand both ! But he demonstrated an SMS to a number and it voiced out! More details can be obtained from their website www.tringme.com

Why I was there? Good question. I thought I should see the budding entrepreneurs and their products. Also, thought I can share my experience on start ups, as all along my career, i was involved in start-up companies/divisions - as an employee, of course!!!!

I had a good lunch and then proceeded towards Indranagar. What in Indranagar? We went to Stones Pub...whaaat, a pub? Yes, you read it correctly. Okay..I didn's say I..but We...that is myself, Simhan (my colleague, Anand (an entrepreneur) from Chennai. What is so special in going to a pub on a saturday evening? Is it Happy Hours (in this recession time)? NO...it was a bloggers meet. Indibloggers (http://www.indiblogger.in), the largest network of Indian bloggers arranged for all Maiden fans to "Heavy Metal Bloggers Meet" a before the famed "SOMEWHERE BACK IN TIME" concert by the Gods of Metal! The bloggers from all over (Chennai, Hyderabad, Trivandrum, Bangalore) came over there and we had a good meeting. Thanks to Kingfisher for sponsoring the event. I met many people over there, but coulld recollect some names...Vineet, Narayan, Praveen, Karthik, Sourav, Anwin, Renie, Zeon, Anwin, Balaganesh, Naveen, Prashant, Swamy. We were there for some time and they organised a Quiz. As I had some work, I headed back home by 6 pm.

While I blog, I am happy that though the day was hectic, I really enjoyed as I met many new people. The week was also hectic. I will resume my IFRS in a day or two. Cheers & Have a nice weekend.
Continue Reading...

Speech by M.R.Venkatesh on Globaliz(s)ation !

Presentation by CA M.R. Venkatesh, Chennai Part of INDIA RE-DISCOVERED
A Seminar on Global Economy By SWADESHI JAGARAN MANCH and VISION INDIA TRUST

The video is on the left side of the blog. Click play button...if it is not working...click the following link:

http://video.google.com/videoplay?docid=4343898391323537541&hl=en

Nice one..please watch!!!

Cheers,
Gopal
Continue Reading...

International Financial Reporting Standards (IFRS)...2

Having seen what is IFRS and why we need IFRS, let us now get into the IFRS little more. The approach I am going to take is, discuss on the following lines:
  • How this IFRS evolved (to give a brief background)
  • Give some background on the implementation in the world
  • How many standards that are there?
  • The plan in India for the convergence
  • Give a brief summary of each of the standards
Do let me know if you need to have any more details that need to be covered.

How this IFRS evolved?

In 1973, the International Standard setting began through an agreement reached by 9 worldwide professional accounting bodies and resulted in the formulation of the International Accounting Standards Committee (IASC). The IASC comprised representatives from 14 countries and was the international standard setting body.

In 2000, the IASC's constitution was amended and a group of trustees were appointed. The IASC was renamed as the International Accounting Standards Board (IASB). IASB issues the IFRS. We saw in the earlier post that many countries in Europe and Asia Pacific made it mandatory and also the US. Having understood the benefits and seeing the universal acceptance, it was decided that India will also follow the suit.

In India, the accounting standards are issued by the Institute of Chartered Accountants of India (ICAI) and they are working on a smooth convergence with IFRS from the accounting period beginning on or after 1st April, 2011. Does that mean that we need to wait till 2011? The answer is NO. Why NO?

If you adopt IFRS for the period ending 31-mar-2011, you need to re-state the previous year's figures also under IFRS. So you need to convert the previous year's (period ending 31-Mar-2010) also under IFRS. So you need to do the exercise in 2009 close itself. We need to gear up in getting us prepared for the convergence.

There are many questions raised, as to :
1. whether it can be implemented in India?
2. whether it is that easy to implement?
3. what is the impact on Income tax?
4. Do we need to maintain separate set of books?
5. to what type of companies, the IFRS will be made mandatory?

You can add more questions...I do not have answers to most of the questions. ICAI is putting all its efforts to make it possible. But it has to work with the following regulators to make sure that the convergence is smooth and seamless:

a. RBI (reporting for the Banking companies)
b. IRDA (reporting for Insurance Companies)
c. Ministry of Corporate Affairs (for companies) & SEBI (for Listed companies)

Why do ICAI need to work with them? As you may be aware that the presentation of Financial Statements are governed by these authorities. For example, Schedule VI to the Companies Act, 1956 prescribes the minimum data that every company incorporated under the Act should publish in its audited Annual Accounts. Also, the Income Tax Act and Rules need to be changed/modified to take into consideration the future change in the accounting per IFRS. For example, if the financial statments are presented on a fair value basis, there bound to be unrecognised gain or loss. This will have an impact on the taxability.

Okay, while the ICAI is working on achieving their goal, let us start our preparation in understanding the IFRS. Let us start our journey with the assumption that ICAI is able to get the concurrence from the ministry to make it happen, as planned.

Some abbreviations that would be mostly used in the discussions,
  • ASB - Accounting Standards Board (in India)
  • GAAP - Generally Accepted Accounting Principles
  • IAS - International Accounting Standards
  • IASB - International Accounting Standards Board
  • ICAI - Institute of Chartered Accountants of India
  • IFRIC - International Financial Reporting Interpretations Committee
  • IRDA - Insurance Regulatory Development Authority
  • MCA - Ministry of Corporate Affairs (in India)
  • NACAS - National Advisory Committee on Accounting Standards
  • RBI - Reserve Bank of India
  • SEC - Securities and Exchange Commission (in US)
  • SEBI - Securities and Exchange Board of India
Following are the IFRS that are issued till date:

  • IFRS 1 First-time Adoption of International Financial Reporting Standards
  • IFRS 2 Share-based Payment
  • IFRS 3 Business Combinations
  • IFRS 4 Insurance Contracts
  • IFRS 5 Non-current Assets Held for Sale and Discontinued Operations
  • IFRS 6 Exploration for and evaluation of Mineral Resources
  • IFRS 7 Financial Instruments: Disclosures
  • IFRS 8 Operating Segments
Let us get into each one of them slowly. I will also try to show how this differ from our Indian Accounting Standards and also USGAAP (to some extent)

Cheers,
Gopal
Continue Reading...

10 points to keep in mind while working on the Cost Reduction Program !

In these turbulent times, most of the organizations, individuals who head a division/unit are faced with the challenge of maintaining the profitability growth of their division/unit. Profitability can be increased either by increasing the revenue or by reducing the expenses. I am not suggesting the areas where the cost can be cut / reduced. but sharing thoughts on how to go about the cost reduction program.

No one is interested in reducing / cutting the cost, as long as the profitability is there. Once they see their revenue is not going up, then everyone will look at improving their bottom-line (profit). The popular way is to reduce the cost.


Can you reduce the cost overnight? No. It is not that easy. While embarking on the cost reduction program, we need to:
  1. analyze the costs (Fixed & Variable) over the period with their benefits.
  2. have a proper Management Information System (MIS) and gather data points before jumping into conclusions.
  3. know your break-even point (BEP, the sales level where we make no profit or no loss). Any sales over and above the BEP is a profit, as it would have covered the Fixed Cost.
  4. understand the impact (Do not compromise on quality & compliance). For example, cutting on Water/Coffee/Tea supplies will make a small reduction in cost, but the impact on employees are more. Instead you can bargain a better rate!
  5. look at various alternates. For example the marketing brochures can be made in a CD (which can accommodate more matter and also cos-effective), using CFL bulbs instead of the regular bulbs (this will save energy), lease v buying, contracting v hiring, etc.,
  6. see whether you can get more out of an expense, rather than reducing it. For example, getting a better bargain out of the Annual Maintenance Contracts (AMC) by bringing in more services within the existing cost.
  7. create smaller groups among the employees and get their ideas (Employee knows better about the organisation than an outside consultant).
  8. compare the like organisations within the same industry
  9. act fast. If some costs are not at all necessary, cut it immediately.
  10. make it a practice to review the operations periodically and course correct your decisions.
We need to keep in our mind that more the fixed expenses (Rent, Salaries, Administrative expenses etc.,), concentrate on controlling them or increasing your sales revenue to cover such expenses. As we all know, the Fixed Expenses per unit vary with the sales volume and Variable Expenses (Raw Material, Sales Commission, etc.,) per unit are fixed. Confusing?

Fixed Expenses are fixed, irrespective of the sales volume. So the per unit Fixed Cost to sales will go up if the sales drop and vice versa. On the other hand, your variable expenses per unit is fixed. If the sales volume goes up, it will go up and vice versa.

Remember, it is not an one-time excercise and you need to review them periodically. Al the very best!

Cheers,
Gopal
Continue Reading...
 

Live NSE Quotes

Know your time

My thoughts Copyright © 2009 WoodMag is Designed by Ipietoon for Free Blogger Template