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ONPAK ELEKTRON LTD.

Presented to: Prof. Muhammad Muazzam Mughal Presented by: Saba Riaz Roll No # BC11-441 Session (2011-2015) B.Com (Hons)/M.ComSubmission date: 20th May 2015

IN THE NAME OF ALLAH

The most Beneficent, the most mercifulAnd we split the Earth in fragments. AndProduce there corn. And grapes and nutritiousPlants and olives and dates and enclosedGarden dense with lofty trees, and fruits, andfodder, for use and convenience to you andyour cattle.(AL-QURAN)

TABLE OF CONTENTS Letter of Transmittal5 Acknowledgement...6 Letter of submission to concern teacher..7 Preface...........8 Executive Summary....9 Dedication....10 Vision Mission Statement....11 Introduction / History....13 Product summary...20 Ratios Analysis...25 Organization chart.....53 Divisions...58 Accounts Department...62 Expenses..64 Finance & I.T Department.71 Financial Statements.84 Balance sheet. Income statement. Cash Flow Statements. Change in Equity.. SWOT Analysis...89 SWOT ANALYSIS DESCRIPTION...90 Recommendations.91 Work done by me92 New Knowledge Acquired ..95 Biblography.96

Letter of transmittal

ACKNOWLEDGMENT

All the praises are for the almighty ALLAH, who Help me with the ability and potential to complete this Internship.All the respects for the Holly Prophet (Peace be upon him) who is forever a touch of guidance and light of knowledge for mankind.And thanks to Prof. Dr. HASSAN MOBEEN ALAM who gives me the chance for doing internship.Words are very few to express enormous humble obligations to my affectionate Parents for their prayers and strong determination to enabling me to achieve this job. First of all, I am thankful to Almighty Allah, who has given me the strength and determination to carry out this internship. My resource persons were

Mr. Nadeem Ud Din Mr. Abdul Ahad Mr. Asad Ullah

And each personnel of finance department I would like express my sincere gratitude to: Mr. Nadeem Ud Din For being so kind and very cooperative

Letter address to concern teacher about the submission of report

Mr. Prof Muhammad Muazzam MughalHailey College of commerce,University of the Punjab,

Subject: Address to teacher about Internship Report

Dear Sir,

I have completed the internship report required to be submitted as a precondition for the completion of B.COM (HONS) at Hailey College of Commerce, University of the Punjab, Lahore.The Internship Report is based on my 6 weeks attachment in Pak Electron Limited (PVT) LTD, A good and the largest electronic company in Pakistan. I have tried my level best to prepare an effective and creditable report.I also want to thank you for your support and patience with me and I appreciate the opportunity provided by the Hailey College of Commerce, University of the Punjab, Lahore.It will be kind of you if you accept my report. I hope you will be pleased with the report.Yourssincerely Saba RiazBC11-441

PREFACE

There is a large difference between knowledge and practical work. Books are the source of Knowledge, but there is the practical work is something different. After bachelor of Commerce an internship for six weeks is a good step for students to acquire some practical knowledge about the course. In class student gain different concepts of accounting, finance, banking, insurance, management, computer and about other related fields. Internship program provide him the chance to see all the things from near and strengthened his concepts.Office environment is entirely different than class, so the student faces various problems in practical work, business field and office environment. But with the laps of time they adopt themselves with the office environment and learn the management behaviors, attitudes and nature of work.This training provides me a lot of practical knowledge and confidence, which I feel will help me in my practical life. In the PEL Industry, The person whom I worked tried best to deliver some knowledge. In this report there is a complete profile of the Saigol Group, who is the owner of the PEL Industries. There are also all the information about the policies, structure and all the financial information about Pak Elektron Limited.

EXECUTIVE SUMMARYPak Elektron Limited (PEL) is the flag bearer of the Saigol Group of Companies. The products manufactured by PEL have always been of high standard and the name 'PEL' is synonymous with quality all over Pakistan. Since its inception, the company has been working for the advancement and development of engineering know-how in Pakistan. The company has produced hundreds of engineers, skilled workers and technicians through its apprenticeship schemes & training programs.The company comprises of two divisions: Appliances Division:This Division of PEL consists of home appliances manufacturing particularly Refrigerators Power Division:PEL Power Division is one of the major electrical equipment suppliers to WAPDA & KESC. The company manufactures transformers, energy meters, switchgears, kiosks, compact stations and shunt capacitor banksOther than this, the company has developed a very good repute in the world of credit due to which most of the financial Institutions like National Bank, Faysal Bank, Punjab Modarba have provided especial credit limits to the Company in ordeto support its operational activities.While working with PAK ELEKTRON LTD, I got very broader visions about company financial activities more than those that I had learned during my B-COM(hons) program.In 1956,the Saigol Group of Companies purchased major shares of PAK Elektron Limited. At this junction, the company was only manufacturing transformers and switchgears. With the Saigols in management, PEL expanded

into Refrigerators & Air Conditioner manufacturing and now it has become a Giant in the World of Appliances.

DEDICATION

I dedicate this internship report to my beloved Prophet Muhammad (S.A.w) and my parents who are the one who nourished me and supported me in every walk of life. My sweet parents, nice teachers, sisters and brothers, friends and very nice co-operative people of the PEL industry who instilled in me the importance of education and hard work.Who sacrifice their sweet wishes to fulfill my wants. And whose prayers helped me in every field.

Vision & Mission Statement

VISIONTo excel in providing engineering goods and services through continuous improvement.

MISSIONTo provide quality product and services to the complete satisfaction of our customer and maximize returns for all stake holders though optimal use of resources.To promote good governance, corporate values, and safe working environment with strong sense of social responsibility.

HISTORY

PAK ELEKTRON LIMITED was set up in 1956 as a joint venture with one of the largest and renowned manufacturers of electrical equipment Messrs. AEG of West Germany for manufacturing Transformers, Switchgears and Electric Motors etc. The entire job of machinery requirements and layout of the factory building was planned and implemented by AEG who produced very well balanced facility for the design and manufacture of the above equipment and the commercial production was commenced on 22 November 1956.

Up to 1962, when AEG finally phased out, AEG experts and PEL personnel carried out the designing and manufacturing of all equipment jointly. PEL staff, in the meantime, had received specialized training in USA and West Germany, which enabled PEL to establish it as the leading manufacturers of electrical equipment in the country with an excellent reputation for high quality, and thus PEL came to be known as "THE QUALITY CONSCIOUS COMPANY".

After conclusion of agreement with AEG, the then sponsors purchased Malik Brothers total share holding of AEG. The production continued with AEG designs with much greater emphasis on the quality and reliability of the products, which earned unique distinction of supplying electrical equipment to projects of paramount national importance like Mangla Dam and Tarbela Dam Projects. PEL equipment was approved by consultants of international repute including PreeceCardew& Rider (England), Binnie& Partners (England), Harza Engineering International (USA) and Miner & Miner International Inc. (USA).

The majority shares were acquired from Malik Brothers by Saigol Group on 11 October 1978 and immediately on takeover the new management chalked out both long term and short term plans to put the company back on the path of progress. As a part of first phase of its BMR Programmer the new management injected the additional working capital of Rupees 8.98 million and Bridge Loan of Rupees 7.50 million (against the public issue of its shares) was provided by the ICP-led Consortium. As a part of long term plans, the manufacturing of window

type Air conditioners was taken up in 1981 and was immediately established for quality.

During the year 1990 the company has signed an agreement with Messrs HITACHI of Japan for the manufacture of Vacuum Circuit Breakers.The company has entered into an agreement with Pakistan Industrial Credit and Investment Corporation (PICIC) for a foreign currency as well as local currency loan of Rupees 25 million for the expansion, balancing, modernization and replacement of the existing plant.

The machinery has come into operation in October 1991 and with the balancing, modernization and replacement of machinery, the production capacity of Refrigerator Section will reach a level of 252,450 cubic feet.

The management of the Company decided to further expand its operation by establishing a plant for the manufacture of compressors for refrigerators and deep freezers. The technical know-how agreement has been signed with M/S NECCHI Compressori, Italy for the assembly and progressive manufacturing of compressors for refrigerators and deep freezers.

LOCATION AND FACILITIESThe project is situated at 14-k.m. Ferozepur Road, Lahore, and is spread over an area of 242 kanals and 15 Marlas of leasehold land in industrial area of KotLakhpat, Lahore, and presently the total covered area comes to 232,883 square feet. Factory is located on the main road where public transport is available round the clock helping in easy access to the labor and customers.

TECHNICAL KNOW-HOW & FOREIGN COLLABORATIONThe company had obtained technical know-how from General Corporation (now Fuji General Limited) of Japan for the manufacture of its Air conditioners and thus was able to produce a unit, which is now preferred by the consumers over all the other imported as well as locally manufactured units. The know-how contract was for five years ending in the year 1988.For the manufacture of Refrigerators, the know-how was obtained from SILTAL CASA SPA of Italy, who are one of the major manufacturers of "white-goods" in Italy and has assisted in the establishment of similar plants in many other countries. The technical know-how for Deep-freezers was obtained from ARISTON of Italy who is the largest manufacturers of "white-goods" in Italy. They have also helped lot of other countries in setting up similar projects for making "white goods"

The company has obtained technical know-how from HITACHI for the manufacture of Vacuum Circuit Breakers.

Company Profile & Historical Overview1956 Incorporation ofPak Elektron Limited1958 Start of Commercial ProductionDistribution Transformers and SwitchGears in Technical Collaboration withAEG Germany1981 Manufacturing of Air Conditionerswith assistance of Fujitsu Japan1987 Manufacturing of Refrigerators& Deep Freezers in TechnicalCollaboration with IAR-SILTAL& ARISTON of Italy1988 Listing with all of Stock ExchangesAcquired License to manufactureVCBs from Hitachi, Japan1994 Quality Management SystemCertification for Energy MeterISO 9001 by SGS1997 Acquired Technology fromCarrier, USA to manufactureAir Conditioners2000 Launching of new crystalseries refrigerator undertechnical collaborationof Danfoss, Germany

2004 Acquired Technology fromGANZ, Hungry to ProducePower Transformers2006 Formal start of EPC BusinessSegment of the Company2009 4th CSR National ExcellenceAward 6th Annual EnvironmentalExcellenceAward Export of Power Transformer2010 Inauguration of New DistributionTransformer Factory by PrimeMinister of Pakistan underTechnical Assistance fromPauwels, Belgium.2011 Launching of New DesireSeries RefrigeratorPrequalification with SaudiElectrical Company SEC2012 Launch of new Arctic seriesRefrigerator with newAesthetics2013 Successful Commissioning of220 KV GIS Shalimar GridStation worth Rs. 1.3 Billion2014 Launching of New Glass DoorRefrigerator with NewAesthetics

Notice is hereby given that the 57 Annual General Meeting of the Shareholders of Pak Electron Limited will be held on Tuesday, April 30, 2013 at 11:00 A.M. at Factory Premises 14-KM. Ferozepur Road, Lahore to transact the following business:-1. To confirm the minutes of Last Annual General Meeting held on30 April 2012.2. To receive and adopt the Annual Audited Accounts of the Company for the year ended 31 December 2012 together with Directors' and Auditors' Reports thereon.3. To appoint Auditors to hold office till the conclusion of the next Annual General Meeting and to fix their remuneration.4. Any other business with the permission of the Chair

PRODUCTSSUMMARY

1. Appliances Division2. Power Division

STATEMENT OF VALUE ADDITION

Rupees in thousands20142013

Wealth GenerationContract Revenue2,842,1172,026,964Sales21,283,59916,829,452Value Added24,125,71618,856,416Other Income32,48346,219Wealth Created24,158,19918,902,635

Wealth Distribution

Cost of Sales12,613,26652%10,945,41958%Employees Remuneration and Benefits1,515,7476%1,306,6777%Depreciation and Amortization756,4163%721,1214%Administrative and Other Expenses311,0261%314,3162%Distribution Cost1,794,3257%1,121,9186%Finance Cost1,892,8288%1,819,45910%Government Levies3,033,12213%2,066,39811%Profit for the Year2,241,4699%607,3273%Wealth Distributed24,158,199100%18,902,635100%

KEY OPERATING AND FINANCIAL DATA Rupees in millions201420132012201120102009

Rupees in millions201420132012201120102009FINANCIALGross Sales24,12618,85620,29413,72319,89516,118Net Sales20,51816,46917,77011,34317,52314,622Gross Profit6,3094,0553,6441,0653,7083,338EBITDA5,1593,3162,9173092,6682,082Financial Charges1,8931,8192,0511,4131,6241,373Profit/(Loss) Before Tax2,545775161(1,802)261394Profit/(Loss) after Tax2,241607115(1,163)189261Earning/(Loss) Per Share - Basic6.614.040.59(9.90)1.242.17Share Capital- Ordinary3,9812,6811,2191,2191,219970- Preference450450450450450526Shareholders Equity11,0266,5453,9083,6034,5664,007

Long Term Loans7,3445,7285,6214,5714,9693,597Current Liabilities7,1487,7829,8329,6299,0066,554Current Portion of LTL / LF1,523422791,1451,234763Non Current Assets15,06815,29514,19814,46313,98110,356Fixed Assets14,46714,81813,81114,08913,4359,720Current Assets17,45911,84811,0169,33111,5498,714Total Assets32,52727,14325,21523,79425,53019,070Current Ratio2.441.521.120.971.281.33Return on Equity25.51%11.62%3.05%(28.47%)4.41%6.77%Debt Equity Ratio0.320.340.420.380.360.35Return on Capital Employed20.86%19.16%22.63%1.57%16.83%19.52%

DIVIDENDCash Dividend------Stock Dividend-10%---10%

PRODUCTION DATATransformer - MVA3,0972,5373,9672,0292,9992,466Switchgears - Numbers6,2588,0211,7801,4903,4434,046Energy Meter - Numbers579,237277,732264,148349,611843,880 443307 Air Conditioner - Numbers9,7121,72091939,56591,95228,581Refrigerators/Deepfreezers - Cfts4,152,2703,306,4283,042,0642,660,3873,660,858 3156604 Microwave Oven-Liters236,391-----

Ratio AnalysisA sustainable business and mission requires effective planning and financial management. Ratio analysis is a useful management tool that will improve your understanding of financial results and trends over time, and provide key indicators of organizational performance. Managers will use ratio analysis to pinpoint strengths and weaknesses from which strategies and initiatives can be formed. Funders may use ratio analysis to measure your results against other organizations or make judgments concerning management effectiveness and mission impact For ratios to be useful and meaningful, they must be: Calculated using reliable, accurate financial information (does your financial information reflect your true cost picture?) Calculated consistently from period to period. Used in comparison to internal benchmarks and goals o Used in comparison to other companies in your industry. Viewed both at a single point in time and as an indication of broad trends and issues over time. Carefully interpreted in the proper context, considering there are many other important factors and indicators involved in assessing performance. Ratios can be divided into four major categories: Profitability Sustainability Operational Efficiency Liquidity Leverage (Funding Debt, Equity, Grants)

The ratios presented below represent some of the standard ratios used in business practice and are provided as guidelines. Not all these ratios will provide the information you need to support your particular decisions and strategies. You can also develop your own ratios and indicators based on what you consider important and meaningful to your organization and stakeholders

Ratio AnalysisRatio analysis includes calculating different ratios for the organization of the figures taken from its financial statement. The basic purpose of ratio analysis is that absolute figures often give misleading image so comparison with other figures is necessary which can be done through ratio analysis.Ratio Analysis includes the following ratios1. Liquidity Ratioa. Current Ratiob. Quick Ratio2. Activity Ratiosa. Total Assets Turnoverb. Stock in Trade to total Assetsc. Inventory Turnoverd. Advances to total Stock in Tradee. Average Collection periodf. Average Payment Period

3. Debt Ratioa. Debt Ratiob. Debt to Equity Ratioc. Time Interest Earned Ratio

4. Profitability Ratiosa. Net Profit Marginb. Earnings per Share (EPS)c. Return on Assets (ROA)d. Return on Equity (ROE)e. Gross Profit Marginf. Operating profit Margin

Liquidity RatiosThe liquidity of a firm is measured by its ability to satisfy its short-term obligations as they come due.

Current RatioThe current ratio, one of the most commonly cited financial ratio, measures the firms ability to meet its short-term obligations. A higher current ratio indicates a greater degree of liquidity. Current ratio can be calculated asCurrent Ratio = Current Assets/Current LiabilitiesRatio20132014

Current AssetsCurrent Liabilities112727317697604156219467082116

146.44%220.58%

InterpretationAs current ratio represents the firms ability to meet its short-term obligations. So it should be higher not to be decreased so the pel Ltd should think over it to increase its liquidity. So current ratio of PEL increased in 2014 as compared to the 2013.

FORMULA[Current Asset Stock/ Current Liabilities]Rs. in (000)

Ratio20132014

Current AssetsStockCurrent Liability

11272731377668676976041562194661401707082116

97.0% 133.8%

Interpretation20132014

SalesTotal Assets154258732656782518522117 30689642

58.06%60.35%

A ratio shows that organization pay off its debt without selling any securities. Quick ratio is also increased in 2014 as compared to the 2013.

Activity Ratios

Activity ratios measure the speed with which various accounts are converted into cash inflows or outflows. Activity ratio measure how efficiently a firm operates along a variety of dimensions such as disbursements, and collections.

Total Assets Turnover = Sales Total Assets 100Rs. in (000)Ratio20132014

SalesTotal Assets15425873265678251852211730689642

58.06%60.35%

Interpretation

Total asset turnover increased in 2014 as compared to 2013 by the amount which shown in abovechart.

Inventory turnover

Inventory Turnover = Cost of Goods InventoryMeasures the activity or liquidity of firms inventory turnover Rs in (000)

Ratio20132014

Cost of goods soldInventory115423463776686127076046140170

3.0562.069

WORKING CAPITAL

FORMULA [Current Assets Current Liabilities](Rs in Thousands)

Ratio20132014

Current assetsCurrent Liabilities

112727317697604156219467082116

35751278539830

InterpretationAs we observe that working capital increased in 2014 as compared to 2013. As current ratio show firm ability to meet its short term obligation.so its should be higher not decreased.

DEBT RATIOFORMULA[Total Liabilities/Total Assets]*100(Rs in Millions)

Ratio 2013 2014

Total DebtTotal Assets

15821287 26567825 16520203 30689642

59.55% 53.82%

InterpretationAs this ratio measures the proportion of total assets financed by the firms creditors. The higher this ratio, the greater the amount of other peoples money being used to generate profits. The higher this ratio, the greater the firms degree of indebtedness and the more financial leverage it has the debt ratio of PEL company decreased in 2014 as compared to 2013.

FORMULA[Debt / Debt+ Equity]Rs.In (000)Ratio20132014

DebtDebt + Equity15821287[15821287+6134282]16520203[16520203+9601082]

72.06%63.24%

Interpretation As observed that debt to equity ratio decreased from 2013 to 2014. It measures the return earned on the common stockholders investment in the firm. Generally, the owners are better off the higher is this return. It indicates that the company have earned on each rupees of common stock equity in this year.

DEBT TO EQUITY RATIOFORMULA[Total debt-Equity](Rs in Thousands)

Ratio20132014

Total DebtEquity

158212876134282165202039601082

96870056919121

Interpretation

Debt to equity ratio of pel company decreased as shown in graph . This ratio is used to assess the extent to which the firm is using borrowed money. The ratio tells us that the creditors are providing rupees for each one rupees being provided by shareholders. Creditors would generally like this ratio to below the

lower the ratio the higher the level of the firms financing that is being provided by shareholders.

TIME INTERST EARNED RATIO

Formula[EBIT/ Interest Expense](Rs in Thousands)

Ratio 20132014

EBITInterest1,551,9231,093,7272,379,4911,161,062

1.422.05

Interpretation

Time interest earned ratio increases by the amount which shown on the above chart.

Profitability Ratios( FORMULA[ Net Profit / Shareholder Equity](Rs.000)Ratio20132014

Net profitShareholder Equity365610313068912272984431029

11.67%27.69%

Interpretation The return on equity (ROE) of pel company increased in 2014 as compared to 2013 which show the positive effect It measures the return earned on the common stockholders investment in the firm. Generally, the owners are better off the higher is this return. It indicates that the company have earned more on each rupees of common stock equity in this year.FORMULA[Net profit/Average Assets]Rs.(000)Ratio20132014

Net ProfitAssets36561026567825122729830689642

1.37%3.99%

Interpretation As observe that return on investment of PEL limited has been increased from 2013 to 2014 Measures the overall effectiveness of management in generating profits with its available Assets. The higher the firms return on total assets the better the efficiency of the company will be

FORMULA[Operating Profit / Net Sale]Rs.(000)Ratio20132014

Operating ProfitNet Sales155192315425873 237949118522117

10.01%12.84%

Interpretation The net profit margin measures the percentage of each sales Dollar remaining after all costs and expenses, including interest and taxes have been deducted. The higher the firms net profit margin, the better the FIRM profitability will be. PEL operating profit margin will be increases in 2014 as compared to the 2013 by the value which shown in the above graph.

Gross Profit RatioGross profit / sales

Ratio20132014

Gross ProfitNet Sales201798415425873 319735418522117

13.08% 17.26%

Interpretation Gross profit also increases from 13.08 to 17.26.

Earnings per share Price per share/price earnings ratioRatio20132014

Price per sharePrice earning ratio102.80 105.8

3.57% 1.72%

Interpretation Earnings per share decreases in this year.

Market ratiosPrice earnings ratioPrice per share / earnings per shareRatio20132014

Price per shareEarnings per share103.56 101.72

2.80% 5.8%

The Directors are pleased to present their report together with Company's audited consolidated financial statements for the year ended December 31, 2014

OPERATING RESULTS AND PERFORMANCE OVERVIEWThe year under review has turned out to be Alhamdulillah, an impressive operational period. During the year the company have achieved revenue of Rs.24.126 billion, showing an increase of 28% in comparison to last year. Further, the gross profit hve also improved from 25% to 31% thereby generating a profit after tax of Rs. 2,241 million in comparision to Rs.607 million of previous year. Earnings per share, despite increase in share capital, has improved from Rs.3.01 to 6.61 per share.

Summary of Results is as under: 2014 2013Rupees in millions 2014 2013 Gross Sales 24,146 18,856 Gross Profit 6,309 4,055 Operating Profit 2,556 796Financial Charges 1,893 1,819Profit before tax 2,545 775Profit after tax 2,241 607Earnings per share (Basic) Rupees 6.61 3.01

I. TRANSFORMERS

Outdoor and indoor distribution transformers of 11/0.415 KV and 33/11 KV up to 5000 KVA. Pad mounted transformers, Kiosks, Dry Type Transformers. Special Furnace Transformers and Silicon Oil Transformers, etc.Major Customers WAPDA & KESC Accounts for over 90% of the total transformer sales

II. SWITCHGEARS

High Tension indoor and outdoor type switchgears up to 33 KV voltage and short circuit level of 750 MVA. Low Tension indoors and outdoors type switchgears up to 4000 Amps. And 100 KA short circuits withstand level. Distribution Boards. Motor Control Centers.

Major Customers WAPDA & KESC Accounts for almost 100% of the total energy a meter sale

III. ELECTRICITY METERS

Major Customer: WAPDA & KESC Accounts for almost 100% of the total energy a meter sale

4- REFRIGERATORS

5-DEEP-FREEZERS

6- SPLIT AIRCONDITIONERS

7-MICROWAVE OVENS

8-Energy Meters

All these things sold locally at different centers all over the Pakistan.Presently we are importing these products under completely built units (CBUs). We also manufactured earlier Window Type Air conditioners and Split Air conditioners.

ORGANIZATIONAL CHART

Chairman/Chief Executive

Mr. MianNaseemSaigol

BOARD OF DIRECTORS

Mr. M. Azam SaigolMr. Haroon Ahmad Khan (Managing Director)Mr. M. Murad SaigolMr. Zaid YousafSaigalMr.AbdullahHaroonSaigalMr. Syed Zubair Ahmed Shah (NIT Nominee)Mrs. Tahira Raza (NBP Nominee U/S 182 ofOrdinance)Mr. Muhammad KhurramKhuwaja (NBP Nominee U/S0182ofOrdinance)Mr. Khalid SiddiqTirmizi (BOP Nominee U/S 182 Of The Ordinance)

COMPANY SECRETARY:Muhammad Omer Farooq

AUDIT COMMITTEEMr. AzamSaigol (Chairman/Member)Mr. Haroon A. Khan (Member)Mrs. Tahira Raza(Member)Mr. Syed Zubair Shah (Member)

AUDITORSM.YousufAdilSaleem& Company Charted AccountantsHR & REMUNERATION COMMITTEE Mr. AzamSaigol (Chairman/Member) Mr. Haroon A. Khan (Member) Mr. Akbar Hassan Khan (Member) Mr. Syed Zubair Shah (Member)

Associated CompaniesThe following are the associated companies of the Company as per section 2(2) of the Companies Ordinance 1984.

Kohinoor Industries Limited Kohinoor Power Company Limited Kohinoor Energy Limited Azam Textile Mills Limited Saritow Spinning Mills Limited Saritow Pakistan Limited Saigol Brothers Limited Guarantee Life Employment Limited Progressive industries (Lahore) (Private) Limited Art Center (Private) Limited Saigols (Private) Limited Conforce (Private) Limited Kohinoor Autos (Private) Limited Kohinoor Tractors (Private) Innovative Technologies (Private) Limited Raytex (Private) Limited Standard Grinding Wheel Industries Limited

Registered /Head Office:17-Aziz Avenue, Canal Bank, Gulberg-V, Lahore

Tel: (042) 5718274-5 or 5717364-5 Fax: (042) 5715105E-mail:shares@saigols.com Website Address:www.pel.com.pk Bankers of the Company: The Bank of Punjab Bank Alfalah Limited Faysal Bank Limited Meezan Bank Limited My Bank Limited National Bank of Pakistan PICIC Commercial Bank Limited Saudi Pak Commercial Bank Limited

DIVISIONS

POWER DIVISION

Power Division accounted for 47% of the Net Sales of the Company. The sales and profit participation by the Division is high due to high quality standards and future growth opportunities. The Power Division comprises of three departments;

Manufacturing and Quality Control Design and Development Marketing

Manufacturing and Quality Control

The Manufacturing Department is responsible for monitoring and execution of production activities for transformers, energy meters and switchgear and also overlooks the vendor development and procurement of local and imported components used in manufacturing of power equipment. The Quality Control department is responsible for maintaining product quality. Transformers and energy meters production is already ISO 9002: 2000 certified while production of switchgear is in process of being certified.

Design and Development

An independent design and development facility with highly qualified team of engineers has been established. The facility is equipped with state of the art technology and is responsible for developing power distribution products in line with customer Requirements. The facility ensures reliable power distribution to industrial and commercial projects.

Marketing

The Marketing Department is responsible for the marketing and sales of Power Division products. Most of the selling activity involves personal selling. Since the products involved are tailor made to customer requirements, knowing the requirements well and adhering to the quality standards required by the customer is of utmost importance. The Department is responsible for meeting sales target for regular customers and negotiating sales deals.

APPLIANCES DIVISION

The Appliance Division accounted for 53% of the Net Sales. The Appliances division comprises of four departments;

Manufacturing and Quality Control Research and Development

Marketing Consumer Finance

A brief description of each is as follows

Manufacturing and Quality Control

The Manufacturing Department is responsible for the monitoring and execution of production activities related to the refrigerators and air conditioners and also overlooks vendor development and procurement of local and imported components. Quality maintenance is the prime concern for the success of this segment therefore; a separate Quality Control department is responsible for the pre-sale inspection of products.

Marketing

The Marketing Department is responsible for the marketing and sales of home appliances products and also undertakes sales promotion. Sales promotion activities undertaken by this Department involve direct marketing and mass marketing through media. However, the primary focus is on utilizing the dealer network to push sales, through incentive schemes targeted at dealers. The Department comprises 21 area sales offices having over 100 marketing and sales personnel supported by area credit control and ware housing departments

ACCOUNTS DEPARTMENT

Following sections are in the accounts Department:

1- Accounts payable section.2- Costing section.3- Fixed asset section.4- Book keeping section.5- Pay roll section.6- Inventory control section.7-Expense and revenues8-Insurance

1- Accounts payable section

PEL pays against purchases through provision account. PEL has created a separate provision account for each party from which it made purchases. They make entries at each stage as follows:

When the purchased material arrives at store entry is made against GRN(goods receipt note) as following

Purchased Material Provision Account (party)

When purchase bill sent by the party arrives in the account department then entry is made as follows

Provision Account (party) Account payable

At the time of payment following entry is made

Account Payable Bank/Cash

Accountant prepares the Purchase Voucher for record keeping purpose. Following this procedure payments are made to the parties from PEL.

NOTESingle provision account can also be maintained for payment to all parties, but PEL maintains a separate provision account for each party.

EXPENSES DETAIL

Expenses for which PEL has to pay are categorized as follows:

1- ADMIN EXPENSES

PEL records Accounts Department Expenses, Finance Department Expenses, HR Department Expenses and Gate Reception Expenses as Admin Expenses.

2- SELLING EXPENSES

All the expenses incurred by Selling Department, Advertising Department and warranty expenses are treated as Selling Expenses.

3- MANUFACTURING EXPENSES

All the expenses incurred by the Manufacturing Department, FOH Expenses And expenses for raw material are Manufacturing Expenses.

4- TRADE ITEMS

All the items, which they purchase from others and do not incure any manufacturing expense, are trade items. For example PEL purchase Air Conditioner, Heavy Generators from career and punch the logo of PEL and pack them into the PEL packing and send them for sale.Now we discuss what is GRN and PV(purchase voucher)

1- GRN(Goods Receipt Note)

When purchased material arrives in the factory, a gate pass is made at the gate and GRN is prepared in the store against that gate pass. GRN includes the following elements

Voucher Number Date Document Type Invoice Number Invoice date Supplier ID

GRN Number , As 0706/T01600706/P0582 etc. T= Transformer P=Power S=Switch gearD= Deep freezer X=common GRN Date P.O.No (Purchase order #) Amount

2- PURCHASE VOUCHER In the account Department at the end of recordings(entries) Purchase voucher is prepared. It includes the following items: Voucher Number Date Document Type Invoice Number Invoice date Supplier ID: Expense ID Expense Title C.P.No (Capital proposal #) FB.No. (Fabrication #) Amount

1- IMPRESED ACCOUNT PEL has also created an impressed or petty cash account. It contains a limited amount, which is already decided by the Finance Manager. This account is used almost in other than factory areas for routine (daily) expense. For example tea, Entertainment, stationary and other cash purchases at the PEL Customer Service Center. Credit Purchases Procedure:Need Generation

Intend/Demand Note

Buying Department

Quotations*(Approval by buying head)

Purchase order preparation

Supplier

Delivery by supplier

challanIGP(Inward gate pass)

SALARIES AND WAGES PAYABLE SYSTEM PEL has established salaries and wages payable system very efficient. Cashier pays salaries to the permanent employees after the job time. During the work time it is intended not to waste the work time. Wages to the temporary employees are paid at working place. They continue their work while receiving the wages

BOOKING KEEPING SECTION

The record of internal expenses related to the employees is maintained in the book keeping sectionDifferent types of voucher are prepared in this section.a) Cash payment Voucher:b) Bank payment Voucher:c) Cash Receipt Voucher:

d) Bank Receipt Voucher:e) Journal Voucher:

Expense TypesDetail of following expenses is maintained in this section. Medical Expenses Traveling Expense Inland Local Foreign Utilities Bills Electricity Mobile PTCL Gas Etctricity Stationary Expense Employee Welfare Expense Entertainment Expense Postage & Telegram Expense Rent rate & Taxes Expense Fee & Subscription Expense Cleaning & Sanitation Expense

Procedure for the approval and payment of these Expenses is given as following.

Section Incharge

Admin

Accounts

Book Keeping section

Voucher preparation

Payment (Through cashier)

FINANCE DEPARTMENT

The Finance department manages the financial resources of the Company. It has the overall responsibility of preparing the Companys operating results, maintenance of financial records, preparation and monitoring of budgets targets, variance analysis, inventory management financing arrangements and dealing with government agencies such as CBR etc. The Division is also responsible for human resources related activities.

ACCOMPLISHMENTS Finance department is working under the supervision of four managers and one General Manager. This department is comprised of four sub departments, namelyBudgeting & Forecasting Department.Treasury Departments. Material Management Department.Accounts Department.

OBJECTIVE OF FINANCE DEPARTMENT Finance people concentrate on following points for accomplishment of their tasks. Try to raise maximum funds. Make arrangement for allocation of funds appropriately. Doing above mentioned activities by controlling cost.

HOW THEY MAKE PLANS Planning is an important aspect for achieving objectives ahead. So while making plans manager foresee the situations in advance and take decisions. It is true in case of finance department. Finance department have to do advance Planning for different tasks about production and utilization of loans appropriately In advance.

HOW THEY TAKE DECISIONS The only thing that is considered at the time of taking decisions regarding fund raising is lower markup rates down because this is what makes loans feasible or otherwise.

PROCEDURAL ASPECTSWORKING CAPITAL FINANCEThis type of loan is secured against;Pledge.Hypothecation.

PLEDGE It may be constructive or actual. Constructive pledge is that in which goods are not taken by bank rather keep them in company's good own under its own security.In case of actual pledge, bank holds the possession of goods.

HYPOTHECATION OF STOCK It can also give against receivables. Incase of stock (raw material W.I.P

finished Goods) all are include. Pay back capacity of exporter should be considered. In case of amount of loan exceeds that amount of stock or receivables pari passu Charge may create if more than one bank involved.

CORPORATE FINANCE DEPARTMENT There are different modes of financing are used.

CASH FINANCE FACILITY Loans can be taken from any commercial bank.

WORKING CAPITAL Use to meet day-to-day routine finance.

RUNNING FINANCE A fix limit is assigned by bank and Co. can use within that limit.

FUNCTIONS OF CORPORATE FINANCE DEPARTMENT Arrangement of Loan both short term and long termProcedure and tasks of corporate section Try to raise maximum funds. Make arrangement for allocation of funds appropriately. Increase working capital.

Loan repayment schedule. Amount sanctioned. Mark up rate negotiate. Charge over fixed assets. Installment period. Interest payment period. Acceptance. Creation of Charge. Leasing.

Guarantees Section Secret behind PELs success and increasing market share is its guarantees section that actively works to get every order either for appliances or for power of the company by speedily participating for the contract with the help of Tender Bonds of Guarantees.

Types of GuaranteesTender guarantee (Bidguarantee).Balance of payment guarantee.Advance payment guarantee.Performance bond guarantee.

Leasing Section This section works in order to fulfill the corporate production, personnel and operational needs such as Machineries, Auto Mobiles and office equipments. It enters into the Buying Contracts always with the one who offers best terms and conditions as well as the best Internal Rate of Return to the Company.

PROCEDURE FOR SHORT TERM LOAN In PEL Industries following procedure is applied for short-term loans.

OFFERING LETTERS Each bank issues an offering letter that mentions the following thingsAmount sanctioned.Markup rate.Charge over assets (hypothecation/pledge).Period.Other conditions.

ACCEPTANCE If PEL agrees on the conditions given by the bank it sends the following Documents. In case the conditions are not acceptable then negotiations are made to bring the conditions to point where there are acceptable to both the parties.Board of directors to open the account.List of directors.Form 29 (details of Original limit documents)Copy of resolution Directors).Signature cards of Directors to open the current account.Memorandum and Articles of association.

CREATION OF CHARGE To create charge, following documents are sent: Form 10 Affidavit Letter of hypothecation/pledge

LETTER OF CONTINUITY When PEL wants a renewal to the existing line after expiry date, it submits a letter of continuity.

PROMISSORY NOTE It is promise of company to pay to the bank the amount of loan plus markup.

LONG TERM LOANS PEL acquired a long-term loan to finance the import of machinery. Recently PEL has purchased some machinery from China for Digital Energy Meters.The process for long-term loan is explained in following.

PREPARATION OF FEASIBILITY REPORT Following points are considered while preparing the feasibility report.

FINANCIAL STATEMENTS Cost of the project. This includes operating assets (land, building,

Vehicles, furniture, capital expenditure and means of finance).Project profit and loss account.Projected statement of changes in financial position. It gives sources ofFinance and the application.Projected balance sheet.

SCHEDULESSales forecast statement.Total production cost.Working capital.Loan repayment schedule.Quantitative of any other companys previous years are taken related to the same industry and multiplied with the present rates.Technical expertise is hire to make projections.

BANK FEASIBILITY REPORT Bank studies the feasibility report and prepare report and prepare its own feasibility report to see where it would be feasible to sanctioned loan to company or not.The bank, if it is satisfied with the feasibility report then send offering letter. It has,Amount sanctioned.Mark up rate.Charge over fixed assets.Tenor.Installment period.Interest payment period.

Acceptance. If company accepts the terms, it must respond with this period.

NEGOTIATION Negotiation between bank and company takes place to change certain conditions of offer letter and it acceptable for both parties. A second draft of the offer letter is prepared with changes and signs of bank and CEO OF PAK ELEKTRON LIMITED.

CREATION OF CHARGES A charge is created in favor of the bank to secure its loan with following documents affidavit. It is an undertaking by the company that will follow all conditions.Form 10. It contains the particulars of assets against which charge is created.Memorandum of constructive deposit of little deeds. It tells about the conditions that the company will follow along with the details of property under charge.All the above documents are submitted with registrar against whom a Certificate of Registration of Mortgage is issued.This schedule is prepared to show the mark up principal and total installment and Value for whole tenor.DUTIES OF CORPORATE FINANCE DEPARTMENT During my stay in PEL as a Internee do my duties in following section of the finance department.Issuance of Bank Guarantee.

Daily reconciliation of Bank Statement regarding FIM & PAD. Duty assigns to me Release of Finished Goods from different Bank.Calculation of Long term & Short Term Loan Mark up.

TREASURY DEPARTMENT:- Treasury management includes management of enterprises holding with the ultimate goal of maximizing the firms liquidity and eliminating its operational, financial and reputational risks. Treasury management includes a firms collections, disbursements concentration, investment and funding activities. Treasury management and cash management are sometimes used interchangeably, while in fact, the scope of treasury management is larger. In PEL treasury department is responsible for the cash transactions with banks, reconcile bank accounts, and maintain current ratio and payment/receipts from vendors. This section arranges and allocates funds needed by different departments. The major functions of the Treasury Department are given below Cash transactions with the different banks. Bank Reconciliation. Payment to vendors. Receipts from vendors. Allocation of funds of various departments.Collections done by online, through bankers Cheque Cashier Cheque Procedure and tasks of treasury department. Arrangement of funds for runs the company operations. This section directly relates to the cash and cash affairs. Inflow and outflow of cash was the basic work of this section.

This section deals with Bank dealing. Fund payments/collection. Updating banks. Foreign payments. Export transactions. Collection of payment. Supplier payment. Issue payment to local supplier, import payment and repayment of bank loan. Prepare cheque, made pay order from different bank, arrangement of online transactions. Reconliciliation of bank statements. Prepare annually, half yearly, quarterly, month cash and daily cash flow.

MATERIAL MANAGEMENT DEPARTMENT:- Material Management can deals with campus planning and building design for the movement of materials, or with logistics that deal with the tangible components of a supply chain , specially , this covers the acquisition of spare parts and replacement, quality control of purchasing and ordering such parts , and the standards involved in ordering, shipping and warehousing the said parts. PRACTISE IN PEL:- In PEL this department has the responsibility to maintain the stock records on daily basis, pledge and release of material and interaction with financial institutions regarding pledge and release of material.A concise description of process of Material Management:

Material is imported against L.C. Material pledged (FIM) Released as much as required Maintaining record of balance Procedure and tasks of the material management department Prepare Monthly Material Release Plan Godowin Insurance Daily check on production Controlling the production plan for the future Control on orders in hand Issuance of Material on Daily Production. Full fill the Material requirement for the production. Financial payments. PAD / FIM / TR Adjustment. Create funds through CF Facility.

BUDGETING DEPARTMENT:- Starting with Budgeting Department that forecasts Annual Sales, Expenditures and Costs for the company after getting production estimates and Sales plans from the marketing and then tell the amount to be arranged for production in order to finance either power divisions production or Appliances divisions production.Procedure and tasks of corporate section. Starting with Budgeting Department that forecasts Annual Sales Expenditures and Costs for the company after getting production estimate

Sales plans from the marketing and than tell the amount to be arranged for production in order to finance either power divisions production or Appliances divisions production.

ACCOUNTS DEPARTMENT:- Accounting is an art of recording, classifying, and summarizing the facts and figures .Accounting department is necessary for every organization even private , manufacturing, Government, or selling, Actually PAK ELEKTRON LIMITED is a manufacturing unit, therefore all the manufacturing, selling, purchasing, administrative export and import transactions are in recorded and financial statements are prepared in accounting department There are the main sub departments in PEL ACCOUNTS PAYABLE SECTION COSTING SECTION PAYROLL SECTION INVENTORYFirst of all requirements are created by production department, they send the demand in purchase section. Purchase section contact to payable section they provide the finance for purchase, small amounts is paid in cash but large amounts are paid in shape of cheque.

RESPONSIBILITIES OF THE DEPARTMENT:- CASH PAYMENT VOUCHER. CASH RECEIPT VOUCHER. BANK PAYMENT VOUCHER.

BANK RECEIPT VOUCHER. JOURNAL VOUCHER. SALES INVOICE RECEIPT. CREDIT PURCHASE VOUCHER. SALE & INCOMETAX RETURN.

LOANING PROCEDURE

Since PEL is a manufacturing concern, so they finance(Take Loan) in the form of material.When they import material from outside of the country. They go to the bank and apply for LC(letter of credit) in the home bank. The home country bank contact with the foreign bank for LC opening. The foreign bank issues a LC to the foreign company of the specified amount for which they started production. After the production has been completed they send documents to the foreign bank and claim for payment. The foreign bank sends the documents to the home bank and claims for payment and material is sent into the bank Godon. Liability is created against PEL. The PEL make the payment to the home bank through FIM(Finance against import material) in small shipments. They pay the shipment and receive the material of same amount of the shipment from the godom.

Financial Statements for the year ended December 31, 2014

CONSOLIDATED BALANCE SHEET AS AT DECEMBER 31, 2014

Rupees in thousandsNote 2014 2013

EQUITY AND LIABILITIES

SHARE CAPITAL AND RESERVES

Authorized capital66,000,0004,000,000

Issued, subscribed and paid-up capital74,431,0293,130,689Capital reserve81,293,858529,740Accumulated profit5,301,5542,885,041TOTAL EQUITY11,026,4416,545,470

SURPLUS ON REVALUATION OF PROPERTY, PLANT AND EQUIPMENT94,568,3574,612,256

LIABILITIES

NON-CURRENT LIABILITIESRedeemable capital104,826,4692,464,286Long term finances112,442,8073,233,175Liabilities against assets subject to finance lease1274,71530,685Deferred taxation132,394,3442,426,847Deferred income1445,15847,5359,783,4938,202,528

CURRENT LIABILITIESTrade and other payables15881,429945,608Accrued interest/mark-up500,5281,454,626Short term borrowings164,243,2614,960,209Current portion of non-current liabilities171,523,155422,0197,148,3737,782,462TOTAL LIABILITIES 16,931,86 15,984,990

CONTINGENCIES AND COMMITMENTS18--

TOTAL EQUITY AND LIABILITIES32,526,664 27,142,716

Rupees in thousandsNote20142013ASSETS

NON-CURRENT ASSETSProperty, plant and equipment1914,466,89014,818,060Intangible assets20344,008348,962Long term investments2163,8908,295Long term deposits22192,808119,67715,067,596 15,294,994

CURRENT ASSETSStores, spares and loose tools23462,140285,771Stock in trade246,316,8683,883,379Trade debts257,702,2725,665,870Advances261,256,100879,586Trade deposits and short term prepayments27853,209453,055Other receivables187,73025,289Short term investments2821,59622,785Advance income tax29319,067354,183Cash and bank balances30340,086277,80417,459,068 11,847,722

TOTAL ASSETS32,526,664 27,142,716

For the year ended December 31, 2014 Consolidated Profit And Loss Account

CONSOLIDATED PROFIT AND LOSS ACCOUNT/STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED DECEMBER 31, 2014 Rupees in thousandsNote201420

Revenue3124,125,716 18,856,416

Sales tax and discount31(3,607,686) (2,387,238)Revenue - net20,518,030 16,469,178

Cost of sales32(14,208,775) (12,414,101)Gross profit6,309,255 4,055,077

Other income3332,483 46,219

Distribution cost34(1,089,521)(809,246)Administrative expenses35(689,570)(642,665)Other expenses36(113,604)(34,053)(1,892,695)(1,485,964)Operating profit4,449,0432,615,332

Finance cost37(1,892,828)(1,819,459)2,556,215795,873

Share of loss of associate21.1.1(10,924)(20,968)Profit before taxation2,545,291774,905

Taxation38(303,822)(167,578)Profit after taxation2,241,469607,327

Other comprehensive income--Total comprehensive income2,241,469 607,327

Earnings per share - basic and diluted396.613.01

CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2014

Rupees in thousandsNote 2014 2013

CASH FLOW FROM OPERATING ACTIVITIES

Cash (used in)/generated from operations40(566,184)1,782,543

Payments for:Interest/markup on borrowings(2,747,954) (1,505,739)Income tax(170,064)(213,856)Net cash (used in)/generated from operating activities(3,484,202)62,948

CASH FLOW FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment(386,819)(333,606)Purchase of intangible assets(234)(41,620)Proceeds from disposal of property, plant and equipment15,74434,412Long term deposits made(73,131)(53,779)Acquisition of short term investments(50,219)-Proceeds from disposal of short term investments-438Net cash used in investing activities(494,659)(394,155)

CASH FLOW FROM FINANCING ACTIVITIES

Long term finances obtained1,850,000-Repayment of long term finances(272,790)(35,638)Proceeds from sale and lease back activities100,000-Repayment of liabilities against assets subject to finance lease(45,826)(44,849)Net increase/(decrease) in short term borrowings345,301 (1,354,882)Proceeds from issue of ordinary shares2,064,4581,828,031Net cash generated from financing activities4,041,143392,662NET INCREASE IN CASH AND CASH EQUIVALENTS62,28261,455CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR277,804216,349CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR41340,086277,804

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED DECEMBER 31, 2014

Issued subscribed andCapitalAccumulatedTotalRupees in thousandsNotepaid-up capitalreserveprofitequity

Balance as at January 01, 20131,668,264164,1342,075,9313,908,329

Comprehensive incomeProfit after taxation--607,327607,327Other comprehensive income----Total comprehensive income--607,327607,327

Incremental depreciation9--201,783201,783

Transaction with ownersIssue of right ordinary shares1,462,425365,606-1,828,031

Balance as at December 31, 20133,130,689529,7402,885,0416,545,470

Comprehensive incomeProfit after taxation--2,241,4692,241,469Other comprehensive income----Total comprehensive income--2,241,4692,241,469

Incremental depreciation9--175,044175,044

Transaction with ownersIssue of right ordinary shares7.1.21,032,2291,032,229-2,064,458

Issue of bonus ordinary shares7.1.1268,111(268,111)--

Balance as at December 31, 20144,431,0291,293,8585,301,55411,026,441

SWOT Analysis

Strengths

Well established base Hard working and committed employees High growth rate Uniqueness of operations from competitors Good departmental support by other deptts Flexible supply of appliances

Weaknesses

Long official procedures Vast uncovered markets Lack of advertisement Lack of public awareness Slow order processing and delivery

Opportunities

Large market areas with great potential Formation of alliances with potential partners Online and more customized marketing Search for more suitable banking institutions with lowest mark-up Foreign alliances especially in technology and development

Threats

Competitors threat to occupy markets that are not yet covered Un-explored markets may be attacked by foreign companies Difficulties in recovery process Deteriorating political conditions Increasing prices due to inflation

BRIEF EXPLANATIONSTRENGTHS

The organization process and procedure are well organized and its management is very sound and efficient as compared to other companies such as Haier and waves. I observed that employees are very hard working and there motivation is very high and they very keen to helps other in performing different task. And its growth rate continuously increased as compared to other companies such as haier and waves.It used best technology to compete other company.WEAKNESSI observe during my internship that the procedure of recruitment is very complicated and there market is very broad and they do not advertise according to their market sometime people are unaware about their newly products. There order processing delivery procedure is very slow.OPPERTUNITIES

They have very big market and they need to increase their resources to achieve large market area and this will provide them with grater revenue moreover it must deal with those banks which provide credit facility at low interest rates.THREATSThe main threat is that the competitors companies take advantage of those areaswhere they do not perform their market activities. There products prices is very high as compare to other companies which may lead them to lose the customers.

Recommendations

The PEL industry is should try to expand the market by exploring new areas. Save time by minimizing the official procedures Advertise the companys offerings to maximum extent Form alliances with potential partners to strengthen the grip over market Search for more suitable banks Try to focus on foreign market for consideration Strong focus on marketing intelligence Speed up recovery procedures by using specialized methods Speed up delivery process by establishing stores in areas of high demand Customer serviceneed to improvecustomers needs. Incentives should be given to motivate sales and recovery teams at initial stages Develop proper goals and objectives for every member of team and department.

WORK DONE BY ME

First of all I worked in payroll department of PEL because it was referred to me by Human Resource department. Payroll department is a sub part of finance department. In payroll department I learned that how salaries are distribute among the all employees of the PEL. There are three categories of employees in the PEL (120) Executive Staff members, Senior/Junior staff (1500 to 1600) and workers (5500).There are three methods which used by the payroll department of the PEL for distribution salaries among above categories. First is payment through cheque. Second is through online transfer and third is by cash.I also learned different policies which organization make for its employees and used these policies in payroll department, such as over time policy, Hajj policy, medical policy, mobile phone allowance policy, travelling allowance and car financing Payroll department maintain daily base attendance and working hours of the employees on the attendance register then forward it towards the H.R and accounts department for approval after the data approval payroll department issue salaries according to employees working hours and attendance.

Human Resource Department:Workers at PEL always feel free in expressing their needs, desires and problems and this right and freedom has been given to them by the personnel of Human Resource Department that always look forward to serve everyone in the company. This department is handling the personnel of both power and appliances division.Whenever it gets any new plan either from power or from appliances it starts searching the best talent to be hired for the respective need and prepares salaries estimates statement. Similarly it also actively participates in hiring employees for other departments and settling down all issues related with employees needs, wants and hurdles.Accounts Department:Pak Elektron has a big accounts department that records daily transactions of both appliances and power division that prepares financial statements such as balance sheets, income statements, cash flow statements, etc.Finance Department:In PEL finance department is working under the supervision of four managers and one General Manager. This department is comprised of four sections, namely:

Budgeting Section Guarantees Section Material Planning Section Leasing SectionBudgeting SectionStarting with the budgeting department that forecasts annual sales, expenditures and costs for the company after getting production estimates and sales plans from the marketing and then tell the amount to be arranged for production in order to finance either power divisions production or appliances divisions production.Guarantee SectionSecret behind PELs success and increasing market share is its guarantees section that actively works to get every order either for appliances or for power of the company by speedily participating for the contract with the help of tender bonds of guarantees.Leasing SectionThis section works in order to fulfill the corporate production, personnel and operational needs such as machineries, auto mobiles and office equipments. It enters into the buying contracts always with the one who offers best terms and conditions as well as the best internal rate of return to the company.

Skills acquired duringinternship Period

Doing Internship at Pak Electron (PVT) Limited has provide me the opportunity to gain the following skills which I believe, has added value and benefited me for my future career. The skills acquired during my internship period can be classified as;Table: Skills acquired during Internship

Acquired Skills1. Strong work ethic2. Dependable and responsible3. Adaptability4. Gain self confidence5. Problem solving skills6. Interpersonal skills7. Networking skills8. Presentation skills

I developed strong work ethics from my internship, which is very important for an employee, which also defines their interest in their work along with their skills. I also learnt to depend on others as it is very important for a team member to depend on otherteam member to successfully accomplish assign goal. In my earlier stage of internship I was to extend self-dependent on towards my work andas result I tried to do every

taskwithout coordinating with team members others, but later Irealized how wrong I was. Deliberately I learned to adapt to different environment andculture. I also had the opportunity to enhance my presentation skills, interpersonal skills and networking skills. At the end of my internship period I was successful enough to develop a client base of more than hundred clients through above learnt skills.

BIBLOGRAPHYThe sources from where I have gathered data for my report are www.pel.com.pk Human Resource Department Finance Department Payroll Department Marketing Power division Power Projects Appliances Division, Marketing Department Annual Report of PEL 2013 & 2014