2013

Quetta Serena Hotel

Mohammad Abdullah Shah Bukhari

[INTERSHIP REPORT] Institute of Management Sciences University of Baluchistan Sariab Road Quetta…

INTERNSHIP REPORT

Quetta Serena Hotel

Submitted By:

Mohammad Abdullah MBA (Finance)

Submitted To:

Manager HR Quetta Serena Hotel

Enrollment: E37

Mailing Address: Abdullah.bukhari.ptv@gmail.com

Contact No: 0345-8167252

Institute of Management Sciences, University of

Baluchistan Quetta

TO WHOM IT MAY CONCERN

This is certified that Mr. Muhammad Abdullah S/O Mohammad Ali

Enrollment. E37 and Registration No.2004/ub-09/a (p) 19954 MBA (Finance) from

Institute of Management Sciences University of Baluchistan has completed his

internship training in Serena Hotel Quetta branch Zarghoon Road Quetta with

effect from 08th

May, 2013 to 18th

June, 2013. During his training we found him

dedicated, hardworking, proficient in his field and obedient to his official staff.

Manager HR

Major ® Hussain Saif

Branch Office:

Shahrah-e-Zarghoon, Quetta, Pakistan

Tel: (92) 812820073

Fax: (92) 812820070

(http://www.serenahotels.com/serenaquetta/)

ACKNOWLEDGEMENT

Thanks to Almighty Allah, The Creator, most Gracious and Merciful whom we never

heard “Nay” whenever I knocked at His door. He bestowed upon us with potential

and ability to sacred wealth of knowledge, which is permanent source of benefit for

his humanity and creature. We offer our humblest thanks from the deepest of our

heart to the Holy Prophet Hazrat Mohammad (Peace Be upon Him) who is forever,

torch of guidance for mankind. I bow my head before almighty Allah with gratitude.

I am obliging to the entire staff of Serena who remains helpful during entire my

internship. They were good, helpful, supporting, and courteous I have learned a lot

practical aspects of management sciences during internship. I am especially thankful

to management of Serena hotel who provide me an opportunity to do internship there.

Dedicated To My Beloved

To my beloved parents who threw bright

patches of light in the dark path of

ignorance that I walked in…

TABLE OF CONTENTS

SR. #

CONTENTS PAGE #

I Title Page

II Copy of Internship Letter

III Acknowledgement

IV Dedication

V List of Contents

01 Objective of Studying the Organization 01

02 Executive Summary 01

03 Overview of Serena Hotels 02

04 Organizational Structure 06

05 Functions of the Finance Department 15

06 My internship program

20

07 SWOT Analysis 23

08 Recommendations 24

09 References 24

10 Appendices

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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01. Objectives of the Internship:

Passion and innovations drag us from yesterday and drive to tomorrow the era of

change. In fact we are rapidly shifting into the new era of human history on this planet

having gone from gatherers and hunters to agriculture producers to industrial

manufacturers to the current gatherers and users of information. Theories remain

Black & White if supported by the colors of practicality. To quench the thirst of

practical exposure, I joined the Quetta Serena Hotel and congregated all necessary

information by which the dream of the esteemed internship report could come true.

Efforts have been made to compile this report in such away that activates its salient

features not only for students but also for the layman. At last I must say that this text

is designed to stimulate the curiosity about management practices of Quetta Serena

Hotel and to raise reader‟s consciousness about the hospitality industry in Pakistan.

02. Executive Summary:

Four star hotels play a very important role when ever there is a foreign people comes

for festivals, visiting, business tours, etc. It also for the locals to visit and enjoy. Over

a period of years, it has now been proved that good environmental hotels can

contribute effectively towards the advancement and prosperity of a country as a whole

and by improving the hospitality when they come and feel that they are the king.

These, from the busy life whenever people feel free themselves they want to take over

their stress by going the place where there will be an element of refreshment. Serena

hotels has a solid foundation in Pakistan, with a network of 8 branches, Serena Head

Office Pakistan Islamabad, Faisalabad Serena, Gilgit Serena, Hunza Baltit Inn,Quetta

Serena Hotel, Sawat Serena Hotel, Shinger Fort Pakistan And Kapalu Place Pakistan,

.During my internship report, various methods of information collection were

adopted, which include interviewing Executives of Serena Hotel, journals, Internet

and, more importantly, my own observation. My internship report consists of

introduction of study, which includes background of study, purpose of study, scope of

study; evaluation of hotels industry history, services provided by Serena Hotels and

functions of different department. SWOT analysis and different strategies also done in

this report. Serena Hotels is a well reputed hotel in Pakistan. Its equity position is very

strong because of its good hospitality. It has a competitive edge due to its more

modern and convenience facilities such as, ATM, courier services, exchange

currency, Doctors, shopping Centre, Rent a Car, Business etc

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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03. Overview of the Quetta Serena Hotel:

Serena Hotels

Type Public

Traded as KN: TPSE

Industry Hospitality, Tourism

Founded 1970s in Kenya

Headquarters Nairobi, Kenya

Products Hotels, Lodges, and Resorts

Owner(s) Tourism Promotion Services

Website www.serenahotels.com

Tourism Promotion Services (Pakistan) Limited was incorporated in Pakistan on 19th

March 1969 and is a public limited company (unlisted) registered under the

Companies Ordinance, 1984. Serena Group of Hotels is a part of this company.

The Aga Khan Fund for Economic Development S.A., Switzerland (AKFED) holds

majority of the shareholding i.e. 92%, followed by 6% holding by the Industrial

Promotion Services (Pakistan) Limited, another project of AKFED and the remaining

2% by Government of Pakistan through Pakistan Tourism Development Corporation

and Ministry of Tourism, Government of Pakistan.

The Company owns and manages hotels in Islamabad, Faisalabad, Quetta, Swat,

Gilgit and Hunza. The expansion plan of the company includes development of hotels

in northern and the southern regions of Pakistan. The company is committed to work

hand in hand with the Government of Pakistan in developing tourism in Pakistan.

The Corporate Office and the Hotels are being managed by a team of professionals.

They are committed to provide full support to their associates for delivering the best

possible, efficient and personalized services to their guests.

In addition to Pakistan, over 20 Serena Hotels and Inns are being run professionally in

Kenya, Tanzania, Zanzibar, Mozambique, Uganda, Afghanistan and Tajikistan.

The four-star Nairobi Serena Hotel is the flagship hotel of the group. It features 183

rooms and 7 suites, including 1 state suite. The Maisha Health Club is arguably the

best in Afghanistan. Along with several other Serena properties it is a member of the

Leading Hotels of the World.

The five-star Serena Hotel in Islamabad, Pakistan was designed by renowned

Pakistani architect Nayyar Ali Dada and opened in 2002. It features 220 rooms with

state-of-the-art facilities, a ballroom for 200 people, three unique restaurants, a

shopping mall, and a health club with a swimming pool. The hotel's rooftop banquet

and main lawns can accommodate up to 1,000 guests. It is also a member of the

Leading Hotels of the World.

The Quetta Serena Hotel has 144 rooms all decorated to reflect the vibrant colors of

the Baluchi people and culture of Baluchistan. Besides all the living amenities

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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through guest rooms, the Hotel also provides conference rooms, health club, business

center and the restaurants, which offer Continental, Chinese Pakistani and Bar-Be-

Que cuisine.

In early 2007, Serena took over management of two properties in Rwanda from

Southern Sun. These hotels have been renamed the Kigali Serena Hotel and the Lake

Kivu Serena Hotel.

Serena Hotels took over management of 3 hotels in 2009 namely, Lake Victoria

Serena Resort located in Uganda equidistant between Entebbe international airport

and Kampala Town. Serena also took over management of Selous Wildlife Lodge and

Mivumo River Lodge Located in the Selous Game Reserve in Southern Tanzania.

Serena Hotels have announced the building of Lake Elementaita Luxury Tented Camp

which should be completed in December 2010.

On July 13, 2011, TPS Serena announced a Sh4 billion plan to upgrade the Nairobi

Serena hotel as competition intensifies in Kenya‟s hospitality industry the revamp will

see the hotel chain establish a separate wing adjacent to the Nairobi hotel that will

have a 300-seat conference Centre, a car park, and 40 new rooms and refurbished

public areas.

3.1 Nature of Business

The Board of TPS Eastern Africa Limited (TPSEAL/ the Company ) is responsible

for the overall management, strategic direction and governance of TPSEAL and its

subsidiaries (“TPS Group”) and is accountable to the shareholders for ensuring that

the Company complies with the provisions of the law. To this end, the TPS Group has

remained committed to ensuring continuous adherence to the highest standards of

corporate governance and business ethics in the interest of the shareholders and other

stakeholders at large. The Company has complied with Nairobi Securities Exchange

(NSE) Continuing Listing requirements and the Guidelines on Corporate Governance

Practices by Public Listed Companies in Kenya issued by the Capital Markets

Authority (CMA). In this respect, the directors have committed to ensuring that

integrity of internal systems continues to be a key pillar in the enhancement of the

Group‟s financial performance and sustainability.

3.2 Volume,

TPS Eastern Africa Ltd. (TPSEA), the Kenyan holding company for a hotels chain

has a turnover reported in year 2011 is 5,465,975,000 shs and basic and diluted

market price per share is 4.51 shs. With total capital resources of 11,516,544,000 shs.

3.3 Main Offices

Serena Properties in Africa Kenya

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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• Nairobi Serena

• Serena Beach Hotel

• Mara Serena Safari Lodge

• Amboseli Serena Safari Lodge

• Samburu Serena Safari Lodge

• Sweet Waters Tented Camp

• Kilaguni Serena Safari Lodge

• Serena Mountain Lodge

• Ol Pejeta House

• Lake Elementaita Serena Camp

Tanzania • Zanzibar Serena Hotel

• Arusha Serena Hotel

• Ngorongoro Serena Safari Lodge

• Serengeti Serena Safari Lodge

• Lake Manyara Serena Safari Lodge

• Kirawira Serena Camp

• Mbuzi Mawe Serena Camp

• Selous Serena Camp

• Serena Mivumo River Lodge

• Dar es Salaam Serena Hotel

Uganda • Kampala Serena Hotel

• Lake Victoria Serena Resort & Spa

Rwanda • Kigali Serena Hotel

• Lake Kivu Serena Hotel

Mozambique • Polana Serena Hotel

Serena Properties in Asia

Afghanistan • Kabul Serena Hotel

Pakistan • Faisalabad Serene Hotel

• Gilgit Serena Hotel

• Hunza Baltit Inn

• Islamabad Serena Hotel

• Quetta Serena Hotel

• Swat Serena Hotel

• Shigar Fort

• Khaplu Palace

Tajikistan • Khorog Hotel

• Dushanbe Serena Hotel

3.4 Total staff strength:

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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Total staff strength of Quetta Serena Hotel is 250 employees including managers and

executives.

3.5 Products & Services:

There are diverse varieties of facilities provided by QSH which includes:-

144 guest Rooms and Suites

Complimentary Airport Shuttle Service

Rent-a-car

Concierge

Multilingual staff

Laundry Shop

The Executive Floor and Jasmine Floor offer additional facilities for our

guests such as private Lounge area, Business Center, Meeting Room and

Butler Service.

Lyallpur Coffee Shop

Fine-dining Restaurant serving Pakistani, Continental cuisine and Hi Tea With

live music

Xuelian Restaurant with Chinese, Japanese and Thai specialty Cuisines

Jharoka, Café and Ice Cream Parlor

The Seasonal Barbeque at the Basant Court featuring traditional provincial

Food with live music

Lobby Lounge serves tea, coffee and light snacks.

Health Club

Swimming pool and sun-deck

Pool Bar

Tennis Court

Squash Court

Gymnasium

Shopping Arcade

Baby-sitting, additional beds/cots, children‟s meals

Conference/Events Centre

24-hour Business Centre

WI-FI Internet access

Flat screen TV with a variety of Channels

24-hour Forex

Room Service,

Valet parking,

In House Laundry and Dry Cleaning same day service

24-hour doctor on call

Power (240V/ 3 pin square- plugs/shaver sockets)

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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4. Organizational Structure:

BOARD OF DIRECTORS

Francis Okomo-Okello (Chairman)

Mahmud Jan Mohamed (Managing Director)

Abdulmalek Virani (Finance Director)

Ameer Kassim-Lakha

Dr. Ramadhani Dau

Jack Jacob Kisa

Ghislain de Valon* (Resigned on 14 November 2011)

Jean-Louis Vinciguerra*

Mseli Abdallah*** * (Alternate Dr. Ramadhani Dau)

Kabir Hyderally***

Mahmood Pyarali Manji

Kungu Gatabaki (Resigned on 14 June 2011)

Guedi Ainache* (Appointed on 12 January 2012)

Ashish Sharma* (Alternat Jean-Louis Vinciguerra)

BOARD AUDIT & FINANCE COMMITTEE

Ameer Kassim-Lakha (Chairman)

Jean-Louis Vinciguerra

Mahmood Pyarali Manji

BOARD NOMINATION AND REMUNERATION COMMITTEE

Jack Jacob Kisa (Chairman)

Dr. Ramadhani Dau

Kabir Hyderally

Mahmood Pyarali Manji

*French ***Pakistani *** *Tanzanian

COMPANY SECRETARY

Dominic K. Ng‟ang‟a

DIRECTORS AND ADMINISTRATION

RINCIPAL OFFICERS

Catherine Waruhiu (Mrs) Director of Human Resources E.A.

Charles Ogada Financial Controller E.A.

Killian Lugwe Director of Operations, City Hotels E.A.

Mark Gathuri Director of Operations, Kenya Lodges &

Resorts

Rosemary Mugambi (M/s) Director of Sales and Marketing E.A.

Salim Janmohamed General Manager - TPS (T) and TPS (Z)

Surinder Sandhu Chief Engineer E.A.

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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TOURISM PROMOTION SERVICES (KENYA) LIMITED [TPS (K)]

Daniel Kangu G eneral Manager - Nairobi Serena Hotel

Tuva Mwahunga G eneral Manager - Serena Beach Hotel and Spa,

Mombasa

Herman Mwasaghua Manager - Amboseli Serena Safari Lodge

Paul Chaulo Manager - Mara Serena Safari Lodge

Henrietta Mwangola (Mrs) Manager - Kilaguni Serena Safari Lodge

Kathurima Mburugu Manager - Serena Mountain Lodge

James Odenyo Manager - Sweetwaters Tented Camp and Ol Pejeta

House

Alphaxard Chege Manager - Lake Elmenteita Serena Camp

TOURISM PROMOTION SERVICES (TANZANIA) LIMITED [TPS (T)]

Jonathan Cheres Manager - Kirawira Luxury Tented Camp

Mustafa Mbinga Manager - Lake Manyara Serena Safari Lodge

Felix Ogembo Manager - Serengeti Serena Safari Lodge

Dismas Simba Manager - Ngorongoro Serena Safari Lodge

Gerald Macharia Manager - Serena Mountain Village Hotel, Arusha

Vincent Matei Manager - Mbuzi Mawe Tented Camp

Charles Mbuya Manager - Mivumo River Lodge and Selous Luxury

Camp

TOURISM PROMOTION SERVICES (ZANZIBAR) LIMITED [TPS (Z)]

Daniel Sambai G eneral Manager - Zanzibar Serena Inn

OTHER MANAGED PROPERTIES

Anthony Chege G eneral Manager - Kampala Serena Hotel, Uganda

Wilfred Shirima G eneral Manager - Lake Victoria Serena Resort,

Uganda

Charles Muia G eneral Manager - Kigali Serena Hotel, Rwanda

Kennedy Were Manager - Lake Kivu Serena Hotel, Rwanda

Karim Merali G eneral Manager - Polana Serena Hotel, Mozambique

Rahim Azad G eneral Manager - Dar es Salaam Serena Hotel

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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4.1 VARIOUS DEPARTMENTS IN QSH

At QSH there are seven major departments and each department has its own style of

working and at the same time it is connected with the rest of the network. These

departments are as follows:-

Accounts Department

Sales & Marketing Department

House Keeping Department

Human Resource (HR) Department

F & B Department

Production Department

Engineering Department

IT department

Front Office Department

Security Department

ACCOUNTS DEPARTMENT

This department is considered as the backbone of the hotel operations. It looks into

all the matters related with the finance and cost control. The department is headed by

Financial Controller. He has the full authority and control over the department and his

decisions in this regard are final with the approval of General Manager. This

department is responsible

To support other operational departments

To maximize hotel profitability

To be accurate in bookkeeping system. It should ensure effective

Management Information System and implementation of controls &

procedures

SALES AND MARKETING DEPARTMENT

This department plays a vital role in attracting customers and runs promotional

campaigns.

HOUSE KEEPING DEPARTMENT

This department is responsible for establishing and maintaining high standards of

cleanliness, for both our external customers (Guests) and internal customers

(employees).The scope of the house keeping responsibilities and duties involve the

following activities as:

Housekeeping control desk

Minibar

Linen

Front of the house

Laundry

Flower Room

Back of the house

Uniform

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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Pest control

Lost & Found

HUMAN RESOURCE DEPARTMENT

Human Resource Department is one of the most important parts of the Quetta Serena

Hotel back of the house management team. It serves to handle all the matters

regarding attracting, retaining and compensating the employees. It overlooks all the

matters that help to develop smooth employment relations all over the Hotel to

achieve maximum output from the employees. It functions like a bridge in between

the workers and management. There is Human Resource Manager who manages the

whole department and its functioning along with the assistant HR-Manager and HR-

Officer.

The sub departments or sections HR-Dept looks into are as follows:

Time Office

Staff Cafeteria Satoon

F & B DEPARTMENT The word F&B stands for Food and Beverages. This department is headed by F&B

director. The main duties assigned are:

Provision of quality food to the guest‟s

Serving and related matters

Maintenance of food items

PRODUCTION DEPARTMENT

The Food & Beverages department when comprised of the production division

involves the kitchen having the specialized production area and wide range of cooking

equipment that helps for cooking of different types of meals. The key objectives of F

& B ( Kitchen) is to enhance the dining experience of the guests and to create the

cuisine which is beyond customer expectations by providing modern creative yet

authentic food and maintaining high hygiene standards . It starts from the purchase of

food items and ends with the production. Following are the sub departments comes

under the Kitchen

Butchery

Garde Manager

Patisserie

Bnquets

Coffee Shop and Room Service

Pakistani, Thai, Chinese

Staff Canteen

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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Kitchen Stewarding

ENGINEERING DEPARTMENT The Engineering department is responsible for the maintenance of various mechanical

sections of the organization and operational readiness of all engineering services. It

also strives to achieve declining routine complaints and minimum down time on

machineries and equipment.

I.T. DEPARTMENT

The Information Technology Department is responsible to design such technologies

for the Hotel that will work efficiently along with the cost control. They are using

opera software and moreover all computers are interconnected.

Multimedia and sound system controls in the Events

FRONT OFFICE DEPARTMENT

Following of the services are offered in the front office of QSH:

Reception

Reservation

Restaurants

Concierge

Guest relation

Business Centre

Rent a car

SECURITY DEPARTMENT

There have always been security needs whenever services are rendered, but

traditionally this has been restricted to pilferage. In modern era service organization

have seen increasing sophistication of the security system offset new and unexpected

challenges.

Some of the functions performed by this department are:

Physical safety of guests

Safety of guest's belongings

Safety of hotel premises from criminal acts

Control of Pilferage

Control of illegal occupancy of rooms by guests

Control of unauthorized use of rooms

Parking control

The Quetta Serena Hotel organization has put into effect procedures where the

security department is authorized to inspect/search any individual even the Assistant

general manager. The General Manager directly controls the security dept.

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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MARKETING & COMMUNICATION SETUPS Hotel business mostly depends on public relations. Management try to have positive

image in public, so because of this QSH maintains a separate good office of public

relations department. This department performs following important functions:

Organizing advertising companies

Conveying protocol on arrival of VIP's

Publishing pamphlets, bulletin

Organizing festivals

Functions

STRUCTURAL DIMENSIONS OF QSH Following are the major dimensions which are adopted in QSH as:

Formalization

Specialization

Line of Authority

Centralization

Professionalism

Formalization – There is a formalized system of the departmentalization at QSH. The

company is divided into formalized departments. These are

Front Office

Room division

House Keeping

Engineering

Purchase

Stewarding

Food & Beverages (Kitchen)

Food & Beverages (Service)

Food & Beverages (Banqueting)

Prestige Club

Public Relations

Sales & Marketing

Human Resource Department

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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Accounts

Information Technology

Specialization

All departments have been assigned a specialized division of labor. They are

responsible for performing their respective tasks and duties when working together.

They share their duties but they are responsible on their own.

Line of Authority

The hierarchal structure practicing in QSH is Top-Bottom approach. Final authority

lays in General Manager or Director Operations that is delegated to the lower level of

management.

Centralization

Being the multinational company it is working under standard operational procedures.

Such procedures pre determine the set of activities the individual departments can

perform. The General Manager controls the department in the way that no department

could involve into such activities that is out of their SOPs. The basic concept of

centralization in QSH is to control the activities of the departments in a favorable

manner.

MEASURING THE HOTEL BUSINESS PLAN

Motivating managers and measuring their performance are key challenges of any

organization. Financial results are typically the barometer for management‟s

effectiveness; however, the drivers of financial results are management‟s performance

in the areas of marketing effectiveness, sales, revenue management, sound labor

relations, quality assurance systems and financial systems, hygiene and control,

amongst other things.

Supervisor

Section Head

Asst. Head of the department

Head of the Department

General Manager/Director Operations

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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The Hotel Management Balanced Scorecard measure the Hotels management

performance in implementing the four areas of the Business Plan (Marketing, Quality,

Staff and Finance).

It also recognizes that, at any stage, the four focus areas may not be of equal critical

importance to the Hotel, in periods of high, sustainable occupancies, marketing may

be of lesser importance than maintaining GUEST service and quality. Each plan has

an adjustable weighting factor.

The measurement of achieved results against goals set in all four weighted areas

constitutes the measurement methodology of the Hotel Management Balanced

Scorecard, giving an overall performance score for the Hotel, as a whole, plus scoring

each contributing focus area (Marketing, Quality, Staff and Finance).

HOTEL REGISTRATION / CHECK IN CARDS Hotel Registration Cards are handed over directly to the guests upon arrival, which

has to be filled in complete and presented at the reception desk or at the desk set up

for this special purpose to obtain room keys. Hotel expects to receive detailed group

naming list one month prior to the arrival date

SAFETY REGULATIONS Following are some safety instructions inside the arena of hotel as:

Any accident or loss occurred to the exhibitor's personal staff or exhibits will

be the exhibitor's own responsibility.

Exhibitors will comply with hotel safety regulations specifically in regard to

fire proof decoration or protection against electrical malfunction.

Any activity threatening fire safety standard or damage to the hotel property

will be discouraged.

RESTRICTIONS – INSIDE THE HOTEL There are following some restrictions inside the building of hotel for security purpose:

Display of signs or banner is not allowed within all public areas of the hotel.

Consumable, i.e. Food and Beverage items, may not be brought into the hotel.

Food and Beverage items cannot be served to the exhibit booths.

The exhibitor can only use the area placed at its disposal and cannot be

extended to the other public areas of the hotel.

The exhibitor undertakes to return the space in its initial condition, any

requirement regarding setup or display against the walls must require prior

permission from Conventions department.

The use of nails, tack, stickers etc. is prohibited.

EMPLOYEES ON – THE – JOB TRAINING In Quetta Serena Hotel (QSH) immense stress is given on the training of the

employees. The process of training an employee does not end with probationary

period but it continues during the whole service of the employee.

The hotel has a training g room which is administrated by the system training

manager. The training room is equipped with modern teaching technique such as

audio, video, TV, projector. It has sitting capacity of around 20 seats.

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Training classes for each department are arranged regularly and headed by chief

executive or a senior member of the department. The schedule of the classes is

displayed on the notice board. English classes are also arranging to enhance the

spoken capability of the employees. The training classes are also essential for senior

executive because annual increment is not based only on job well done but also on

learning abilities and enthusiasm to teach others.

At the end of training program an exam is conducted to assess the learning of

employees. During the training program it is the responsibility of the employees to

attend and participate in all classes whether it is about hotel rules and regulation about

his job or English classes. It is also important that the employees should participate in

the classes and pass his exam.

VARIOUS SERVICES FOR GUESTS The guests have access to all kinds of services and facilities so as to make their stay,

not only comfortable, but also a memorable one. The QSH is not simply all that. It has

every intention of offering its guests services and facilities that they expect of genuine

first class hotels, services which have not yet been made available on this scale before

in Pakistan. Besides these the following services and facilities are available to our

guests:

Laundry/Dry Cleaning

Jewelry and Gem shops

Travel Desk

Parking

Baby Sitting

Authorized Money Changers

Airline Offices

In-House Doctor

Florist

Bookstore

Business Centre

Pharmacy

24 Hour Room Service

Car Rental

CONSUMER TYPE Service firms have both consumers and organizational customers. The services are

analogues in some cases, but different marketing strategies are required for the

different type of customers. The QSH has two types of clients:

The Regular Corporate Client

The General Client

The seventy five percent (75%) of the hotel's business is dependent on the corporate

client. Many large organizations have a contract with the hotel and their clients

regularly avail the services of the hotel. Seventy percent (70%) of the tourists are

regular corporate client of the hotel. They come here and avail the services for the

business purposes or for recreation. There is another type of customers that is the

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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general clients of the hotel. These customers come here for the recreation. So the hotel

has a different marketing strategies for the corporate client and different for the

general client.

5. 1 General information

TPS Eastern Africa Limited is incorporated in Kenya under the Companies Act as a

public limited liability company and is domiciled in Kenya. The address of its

registered office is:

Williamson House

4th Ngong Avenue

PO Box 48690

00100 NAIROBI

KENYA.

The Company‟s shares are listed on the Nairobi Securities Exchange.

For the Kenya Companies Act reporting purposes, the balance sheet is represented by

the statement of financial position and profit or loss by the statement of

comprehensive income in these financial statements.

5.2 Summary of significant accounting policies

The principal accounting policies adopted in the preparation of these financial

statements are set out below. These policies have been consistently applied to all

years presented, unless otherwise stated.

(a) Basis of preparation

The financial statements are prepared in compliance with International Financial

Reporting Standards (IFRS). The measurement basis applied is the historical cost

basis, except where otherwise stated in the accounting policies below. The financial

statements are presented in Kenya Shillings (Shs), rounded to the nearest thousands,

except where otherwise indicated.

The preparation of financial statements in conformity with IFRS requires the use of

certain critical accounting estimates.

It also requires management to exercise its judgment in the process of applying the

Group‟s accounting policies. The areas involving a higher degree of judgment or

complexity, or where assumptions and estimates are significant to the financial

statements.

Changes in accounting policy and disclosures

(i) New and amended standards adopted by the Group

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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The amendment to IAS 24, „Related party disclosures‟ clarifies and simplifies

the definition of a related party and removes the requirement for government-

related entities to disclose details of all transactions with the government and

other government-related entities. The amended definition means that some

entities will be required to make additional disclosures, e.g., an entity that is

controlled by an individual that is part of the key management personnel of

another entity is now required to disclose transactions with that second entity.

There has been minimal impact on related party disclosures following

adoption of this amendment.

The amendments to IFRS 7, „Financial Instruments - Disclosures‟ are part of

the 2010 Annual Improvements and emphasizes the interaction between

quantitative and qualitative disclosures about the nature and extent of risks

associated with financial instruments. The amendment has also removed the

requirement to disclose the following;

Maximum exposure to credit risk if the carrying amount best represents the

maximum exposure to credit risk;

Fair value of collaterals; and

Renegotiated assets that would otherwise be past due but not impaired.

The application of the above amendment has simplified financial risk disclosures

made by the Group.

Other amendments and interpretations to standards became mandatory for the year

beginning 1 January 2011 but had no significant effect on the Group‟s financial

statements.

(ii) Standards, amendments and interpretations to existing standards that are

not yet effective and have not been early adopted by the Group

Numerous new standards, amendments and interpretations to existing standards have

been issued but are not yet effective. Below is the list of new standards that are likely

to be relevant to the Group. However, the directors are yet to assess the impact on the

Group‟s operations.

Standard Title Applicable for financial years

beginning on/after

IAS 19 Employee benefits 1 January 2013

IFRS 9 Financial instruments 1 January 2015

IFRS 13 Fair value measurement 1 January 2013

IAS 19, Employee benefits

The impact on the Group will be as follows: to eliminate the corridor approach and

recognize all actuarial gains and losses in other comprehensive income as they occur,

to immediately recognize all past service costs; and to replace interest cost and

expected return on plan assets with a net interest amount that is calculated by applying

the discount rate to the net defined benefit liability/(asset). The amendment will not

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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have a significant impact on the Group statement of financial position since all

actuarial losses are recognized immediately in the income statement.

IFRS 9, ‘Financial instruments’

IFRS 9 was issued in November 2009 and October 2010 and replaces those parts of

IAS 39 relating to the classification and measurement of financial instruments.

IFRS 9 requires financial assets to be classified into two measurement categories:

those measured as at fair value and those measured at amortized cost. The

determination is made at initial recognition. The classification depends on the entity‟s

business model for managing its financial instruments and the contractual cash flow

characteristics of the instrument.

For financial liabilities, the standard retains most of the IAS 39 requirements. The

main change is that, in cases where the fair value option is taken for financial

liabilities, the part of a fair value change due to an entity‟s own credit risk is recorded

in other comprehensive income rather than in statement of comprehensive income,

unless this creates an accounting mismatch. The Group is yet to assess IFRS 9‟s full

impact and intends to adopt IFRS 9 no later than the accounting period beginning on

or after 1 January 2015.

IFRS 13, ‘Fair value measurement’

IFRS 13 aims to improve consistency and reduce complexity by providing a precise

definition of fair value and a single source of fair value measurement and disclosure

requirements for use across all IFRSs. The requirements, which are largely aligned

between IFRS and US GAAP, do not extend the use of fair value accounting but

provide guidance on how it should be applied where its use is already required or

permitted by other standards within IFRS. The Group is yet to assess IFRS 13s full

impact.

There are no other IFRSs or IFRIC interpretations that are not yet effective that would

be expected to have a material impact on the Group.

(b) Consolidation

(i) Subsidiaries

Subsidiaries are all entities over which the Group has the power to govern the

financial and operating policies generally accompanying a shareholding of more than

one half of the voting rights. The existence and effect of potential voting rights that

are currently exercisable or convertible are considered when assessing whether the

Group controls another entity. The Group also assesses existence of control where it

does not have more than 50% of the voting power but is able to govern the financial

and operating policies by virtue of de-facto control. De-facto control may arise in

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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circumstances where the size of the group‟s voting rights relative to the size and

dispersion of holdings of other shareholders give the group the power to govern the

financial and operating policies, etc.

Subsidiaries are fully consolidated from the date on which control is transferred to the

Group. They are de-consolidated from the date the control ceases.

The Group uses the acquisition method of accounting to account for business

combinations. The consideration transferred for the acquisition of a subsidiary is the

fair values of the assets transferred, the liabilities incurred and the equity interests

issued by the Group. The consideration transferred includes the fair value of any asset

or liability resulting from a contingent consideration arrangement. Identifiable assets

acquired and liabilities and contingent liabilities assumed in a business combination

are measured initially at their fair values at the acquisition date. The Group recognizes

any non-controlling interest in the acquire on an acquisition- by-acquisition basis,

either at fair value or at the non-controlling interest‟s proportionate share of the

recognized amounts of acquirer‟s identifiable net assets.

If the business combination is achieved in stages, the acquisition date fair value of the

acquirer‟s previously held equity interest in the acquiree is premeasured to fair value

at the acquisition date through profit or loss.

Any contingent consideration to be transferred by the Group is recognized at fair

value at the acquisition date. Subsequent changes to the fair value of the contingent

consideration that is deemed to be an asset or liability is recognized in accordance

with IAS 39 either in the income statement or as a change to other comprehensive

income. Contingent consideration that is classified as equity is not premeasured, and

its subsequent settlement is accounted for within equity.

Goodwill is initially measured as the excess of the aggregate of the consideration

transferred and the fair value of non-controlling interest over the net identifiable

assets acquired and liabilities assumed. If this consideration is lower than the fair

value of the net assets of the subsidiary acquired, the difference is recognized in the

income statement.

Inter-company transactions, balances and unrealized gains on transactions between

Group companies are eliminated. Unrealized losses are also eliminated unless the

transaction provides evidence of an impairment of the asset transferred. Accounting

policies of subsidiaries have been changed where necessary to ensure consistency

with the policies adopted by the Group.

Investments in subsidiaries are accounted for at cost less impairment. Cost is adjusted

to reflect changes in consideration arising from contingent consideration amendments.

Cost also includes direct attributable costs of investment.

(ii) Changes in ownership interests in subsidiaries without change of control

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Transactions with non-controlling interests that do not result in loss of control are

accounted for as equity transactions – that is, as transactions with the owners in their

capacity as owners. The difference between fair value of any consideration paid and

the relevant share acquired of the carrying value of net assets of the subsidiary is

recorded in equity. Gains or losses on disposals to non-controlling interests are also

recorded in equity.

(iii) Disposal of subsidiaries

When the Group ceases to have control, any retained interest in the entity is

premeasured to its fair value at the date when control is lost, with the change in

carrying amount recognized in profit or loss. The fair value is the initial carrying

amount for the purposes of subsequently accounting for the retained interest as an

associate, joint venture or financial asset. In addition, any amounts previously

recognized in other comprehensive income in respect of that entity are accounted for

as if the Group had directly disposed of the related assets or liabilities. This may mean

that amounts previously recognized in other comprehensive income are reclassified to

the income statement.

(iv) Associates

Associates are all entities over which the Group has significant influence but not

control, generally accompanying a shareholding of between 20% and 50% of the

voting rights. Investments in associates are accounted for by the equity method of

accounting. Under the equity method, the investments are initially recognized at cost,

and the carrying amount is increased or decreased to recognize the investor‟s share of

the profit or loss of the investee after the date of acquisition. The Group‟s investment

in associates includes goodwill identified on acquisition. If the ownership interest in

an associate is reduced but significant influence is retained, only a proportionate share

of the amounts previously recognized in other comprehensive income is reclassified

to the income statement. The Group‟s share of its associates‟ post-acquisition profits

or losses is recognized in the income statement, and its share of post-acquisition

movements in other comprehensive income is recognized in other comprehensive

income, with a corresponding adjustment to the carrying amount of the investment.

When the Group‟s share of losses in an associate equals or exceeds its interest in the

associate, including any other unsecured receivables, the Group does not recognize

further losses, unless it has incurred legal or constructive obligations or made

payments on behalf of the associate.

The Group determines at each reporting date whether there is any objective evidence

that the investment in the associate is impaired. If this is the case, the Group

calculates the amount of impairment as the difference between the recoverable

amount of the associate and its carrying value and recognizes the amount adjacent to

„share of profit/ (loss) of an associate‟ in the income statement.

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Profits and losses resulting from upstream and downstream transactions between the

group and its associate are recognized in the Group‟s financial statements only to the

extent of unrelated investor‟s interests in the associates. Unrealized losses are

eliminated unless the transaction provides evidence of an impairment of the asset

transferred. Accounting policies of associates have been changed where necessary to

ensure consistency with the policies adopted by the Group.

Dilution gains and losses arising from investments in associates are recognized in the

income statement.

06. My Internship Program:

a) Introduction of the Branch where i worked

I have worked in the Quetta Serena which is the sub branch of the TPS Nairobi Kenya

Comes under the regional office of Islamabad Serena. Located in the city center and

spread over six acres, Quetta Serena Hotel is prominently located on Shahrah-e-

Zarghoon in the Cantonment area. The hotel is conveniently accessible from all parts

of the country and is linked by air, rail, and road network.

It has a character of its own. It has incorporated many stunning architectural and

decorative elements of the local Baloch people - famed for their chivalry and martial

prowess. Traditional arts and crafts, decorative patterns and other graphic designs

found throughout the plush interior of the hotel are an affirmation of pride in the local

culture and aesthetic traditions.

With stunning mountain views on all sides, the hotel is set amid flower-filled

courtyards with fountains and water channels around the fruit orchards. It provides

guests with first-class amenities and a world of luxury where the service is warm and

gracious. From the doormen to the reception, to the Room Service and everything in

between, it promises to make each ones stay a memorable one.

b) Departments in which i worked during my internship & Description of the

tasks/projects which were assigned to me during my internship

Quetta Serena Hotel Front office: Manager (Mr. Imran)

Date: 13/05/2013 Monday to 18/05/2013 Saturday

Operator

Photocopy operating and code was 987132 room code 3, fax machine

operating, opera software catalogue, Operating of fax machine, operating of

console, reminding and dialing of extensions transferrin calls and method of

dialing, dialing outside calls using line i.e. 9,

Front desk cashier Pit 1 , Pit 2 = Reg sheets, Reminder register, vatch card,

checks, mini bar bills, billing American express card rate 2.5 rs, normal 1.5 rs,

Prestige club machine 1 night free after 900 points, float of cashier outlet

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2000, cashier 35000, remittance envelope, cashier closure method, billing and

occupancy, Giddan, lobby, front desk, guest reservation, bell desk, bell boy,

Ziarat Cofy Shop, Xuelian, Qila Saifullah house, Makran, gym health club

swimming pool, bed tax 40 rs, 16% gst on whole amount i.e. 40+amount,

Receptionist Customer dealing, Check in, check outs on opera, greeting to the

customer, billing

Reservation through opera

Remittance envelope

Cashier closure and float of 35,000 for front and 2000 for outlet

Occupancy checking through opera in term of graph and other in days and

percent f3

Operator use of opera f7

Make up sheet

Mod chart display

Flight schedule

Front office duty roster

Walk in check in

Reports from house keeping

Guest profile creation

Key charging

Fruit basket preparation cp1,cp3,cp5

Checkouts postings

Expected and actual arrivals

Quetta Serena Hotel Food and beverages: Manager (Mr. Gulistan)

Date: 20/05/2013 Monday to 25/05/2013 Saturday

Standard operating procedure

Early birds reports

Orientation

Kitchen cooking

Xulian

Ziarat coffee shop

Banquet management

Room Service

Stores

Quetta Serena Hotel Housekeeping: Acct: Manager (Mr. Zulfiqar Hussain)

SOP file study

Laundry

Messages handling

Log book writing

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Room division i.e. K: wing 161-183, H: wing 130-148, G: wing 121-127, F:

wing 101-120, J: wing 149-150

First flour executive flour with F,H and K wings sweets out of 141 total rooms

President sweet 2, Khojak mini sweet, Deluxe room, Standard room, Twin

bed,

List, House keeping work plan, House keeping duty roster

Uniform handling

Brief orientation of rooms

Brief visits of floor

Housekeeping report 3 times a days morning 10 am, afternoon 4 pm, evening

10 pm

Room boy trolley check list

Preparation of defect report, room boy report, minibar charging

Quetta Serena Hotel Sales and marketing: Director Sales (Mr. Edwin Das)

Date: 27/05/2013 Monday to 01/06/2013 Saturday

SOP file study

Prestige Club

Sale Calls

Report writing

Borrower‟s lists

Economic report

Budget presentation

Quetta Serena Hotel Finance Department: Financial Controller (Mr.

Mohammad Athar)

Date: 10/06/2013 Monday to 18/06/2013 Tuesday

Preparation of bank reconciliation

Contract management

Filing, punching and their types

Checks management and their justification

Duties and responsibilities of all the staff sop

Slight overview of Receivables, payable, accounts management and income

and night audit

Study of sop file, pay slips, checks, invoices, financial statements

Approval of reimbursement from head office

Bunch preparation

Due to scarcity of time Got failed to see some more substantial things like

preparation of financial statement, budget and investment mechanism

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7. SWOT Analysis of Quetta Serena Hotel

Strengths

1. Contended employees, Hygienic motivation factor

2. Physical, financial, technological, human, resources

3. Employees educated and synchronized with technological sophistication

4. Conducive and motivational work environment

5. Efficient management

6. Learning environment

Weaknesses

1. Lake of leadership I.e. direction, decision making and effectiveness

2. Negligence to the innovation

3. Absence of R&D Department

4. Poorly defined jobs with less information to what employees are doing and

who they are

5. Pressurized employees rather motivated when it comes to work

6. Lake of effective utilization of all resources

7. Use of conventional marketing techniques

8. Lake of abilities to captivate unionization

9. Excessive administrative expenses

10. Effective delegation of authorities

11. Great distinction among internal and external social culture.

Opportunities

1. Serena has a great potential market only the need is to capture it through the

alteration in strategies.

2. Leadership should be more oriented and effective towards goals, directions,

decision making and effectiveness.

3. Inclination towards innovation

4. Assurance of R&D activities

5. Planning, recruitment, Job description, job specification, employee

involvement, compensation, TNA, T&D, appraisal and team building, should

be streamlined.

6. No doubt employees are satisfied with their jobs but they should be motivated

to work as well and this motivation can be brought through compensation and

involvement strategies.

7. Serena has a great potential to generate more business by utilizing utilize

resource efficiently

8. Serena has an opportunity to use contemporary marketing techniques such as

media awareness campaigns on rates and products and services.

9. Serena can captivate with the unionized employees easily using voluntary

separation scheme and through equity, unions are formed because the seek

equity in the reward system.

10. Administrative expenses should be curtailed down and should be efficiently

utilized if occurring any way.

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11. Serena can bring convenience for employees and for themselves as well by

changing dress code. Dress code and uniform should be for only employees

those are interacting with guests

12. Materiality and immateriality concept of accounting should be applied on

while accounting it can save time and rigorous efforts.

13. Can target middle class witch is majority in Quetta.

14. Serena can start home delivery of food

Threats to the Organization

1. Only the administrative expense is the finest threat to the organization Serena

should utilize these administrative expenses. Through increasing business.

2. Serena is threatened by its higher prices

3. Terrorism law and order

4. Distinction of culture

5. High employee turnover intention and low salaries

6. There is much lack of co-ordination among its workers

7. Only the niche market is targeted

8. Quetta Serena Hotel is desperately threatened by its strategy

08. Recommendations: I cannot comment in a way that it can

be in the case of other organizations.

The issue is that Serena is not a non

profit organization but working like

non profit organization. Always feeded

by the head office cannot even meet its

expenditures even. According to them

they are doing social welfare so there

fore I will not suggest them to take

austerity measures. People of Quetta

are not as hard working in contrast of

their counterparts in Karachi and

Lahore and in other cities because jobs

are easily available in Quetta therefore

people of Quetta do not chose to work

hard on fewer salaries. There fore

turnover intention is also high in this

organization for Serena reward system

is the only tool to retain employees. As

I indicated the leadership should make

strategy to nurture the retention culture

and to retain valuable employees.

09. References & Sources Used for Data Collection

Tps eastern Africa limited annual report and financial statements 2011

www.serenahotels.com

Internship report writing guidelines Career Management Center (CMC),

Preston University, Islamabad

Financial statement analysis using financial accounting information By

Charles H. Gibson

Accounting the basis for business decision Robert f. Maigs and William d.

Maigs

Managerial accounting by Ronald w. Hilton

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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10. Annexes/Appendices

Table 101: Consolidated Income Statement for the year ended December 31 2011 Vertical Analysis Horizontal Analysis

2010 2011 2010 2011 2010 2011

Shs’000 Shs’000 %ages %ages %ages %ages

Sales 4,480,128 5,465,975 100 % 100 % 100 % 122 %

Other operating income 427,578 271,378 10 % 5 % 100 % 63 %

Inventory expensed (874,595 ) (929,234) (20 %) (17 %) 100 % 106 %

Employee benefits expense (1,335,351) (1,576,219) (30 %) (29 %) 100 % 118 %

Other operating expenses (1,589,742) (1,963,175) (35 %) (36 %) 100 % 123 %

Profit before dep, tax and interest 1,108,018 1,268,725 25 % 23 % 100 % 115 %

Depreciation on property, plant and equipment (257,617) (330,834) (6 %) (6 %) 100 % 128 %

Finance income 52,227 59,757 1 % 1 % 100 % 114 %

Finance costs (210,783) (163,847) (5 %) (3 %) 100 % 78 %

Share of profit of associates 1,088 19,332 0.02 % 0.35 % 100 % 1,777 %

Profit before income tax 692,933 853,133 15 % 16 % 100 % 123 %

Income tax expense (176,549) (237,242) (4 %) (4 %) 100 % 134 %

Profit for the year (Shs ) 516,384 615,891 12 % 11 % 100 % 119 %

Earnings per share basic and diluted (Shs per share) 3.49 4.51 3.49 4.51 100 % 129 %

TPS eastern Africa limited annual report and financial statements 2011

Table 102:Consolidated Statement of Financial Position As at 31 December Vertical Analysis Horizontal Analysis

2010 2011 2010 2011 2010 2011

Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000

Stock holder's equity

Share capital 148,211 148,211 1.24 % 1.13 % 100.00 % 100.00 %

Share premium 3,032,431 3,032,431 25.43 % 23.09 % 100.00 % 100.00 %

Revaluation reserve 2,473,370 2,404,495 20.74 % 18.31 % 100.00 % 97.22 %

Translation reserve (157,883) (90,593) (1.32) % (0.69) % 100.00 % 57.38 %

Retained earnings 1,717,779 2,262,751 14.41 % 17.23 % 100.00 % 131.73 %

Proposed dividends 185,264 192,674 1.55 % 1.47 % 100.00 % 104.00 %

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Sub total 7,399,172 7,949,969 62.06 % 60.54 % 100.00 % 107.44 %

Non controlling interest 97,213 96,855 0.82 % 0.74 % 100.00 % 99.63 %

Total equity 7,496,385 8,046,824 62.87 % 61.28 % 100.00 % 107.34 %

Non-current liabilities

Borrowings 1,204,524 1,659,372 10.10 % 12.64 % 100.00 % 137.76 %

Deferred income tax liability 1,453,428 1,678,659 12.19 % 12.78 % 100.00 % 115.50 %

Retirement benefit obligations 110,835 131,689 0.93 % 1.00 % 100.00 % 118.82 %

Total non-current liabilities 2,768,787 3,469,720 23.22 % 26.42 % 100.00 % 125.32 %

Current liabilities

Payables and accrued expenses 1,205,488 1,139,017 10.11 % 8.67 % 100.00 % 94.49 %

Current income tax 31,720 9,585 0.27 % 0.07 % 100.00 % 30.22 %

Borrowings 420,757 466,694 3.53 % 3.55 % 100.00 % 110.92 %

Total current liabilities 1,657,965 1,615,296 13.91 % 12.30 % 100.00 % 97.43 %

Total equity and liabilities 11,923,137 13,131,840 100.00 % 100.00 % 100.00 % 110.14 %

Non-current assets

Property, plant and equipment 8,248,664 8,829,042 69.18 % 67.23 % 100.00 % 107.04 %

Intangible assets 1,057,861 1,057,861 8.87 % 8.06 % 100.00 % 100.00 %

Investment in associates 30,718 687,008 0.26 % 5.23 % 100.00 % 2,236.50 %

Available-for-sale financial asset 216,251 - 1.81 % - % 100.00 % - %

Deferred income tax asset 33,661 143,000 0.28 % 1.09 % 100.00 % 424.82 %

Total fix assets 9,587,155 10,716,911 80.41 % 81.61 % 100.00 % 111.78 %

Current assets

Inventories 299,776 375,588 2.51 % 2.86 % 100.00 % 125.29 %

Receivables and prepayments 986,959 1,636,227 8.28 % 12.46 % 100.00 % 165.78 %

Cash and cash equivalents 1,049,247 403,114 8.80 % 3.07 % 100.00 % 38.42 %

Total current assets 2,335,982 2,414,929 19.59 % 18.39 % 100.00 % 103.38 %

Total Assets 11,923,137 13,131,840 100.00 % 100.00 % 100.00 % 110.14 %

TPS EASTERN AFRICA LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS 2011

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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Table 103: RATIO ANALYSIS

1. Liquidity ratios Ratio

s

a) Current ratio=Current assets/current liabilities % 1.50

b) Quick ratio / acid test ratio= Current assets -inventory/ current liabilities % 1.26

c) Cash ratio= cash + marketable securities/Current liabilities % 24.96

d) Networking capital= current assets - current liabilities shs 799,6

33

e) Defensive interval= cash + marketable securities +accounts receivables/

projected expenditures * 365 days 167

f) Length of operation cycle=avg # of days a/r outstanding + avg # of days

inventory in stock days 138

g) Length of cash cycle = operating cycle- avg # of days a/p outstanding days 63

2. Activity Ratio

a) Inventory turnover ratio=cost of goods sold/ avg inventory time

s 12

b) Average # of day’s inventory in stock=360/inventory turnover days 30

c) Accounts receivable turnover=net sales/avg a/r time

s 3

d) Average number of days accounts receivables outstanding=360/a/r

turnover days 108

e) Account payable turn over= net sales/ avg a/p.

time

s 5

f) Average # of days accounts payables outstanding=360/a/p. turnover days 75

g) Fix asset turnover ratio=net sales / avg fix assets

time

s 0.51

h) Operating asset turn over ratio=net sales / avg operating assets

time

s 0.52

i) Total asset turn over ratio=net sales / avg total assets

time

s 0.42

3. Solvency Ratio

a) Debt to equity ratio= total debt / total stock holder's equity*100 % 63

b) Debt to capital ratio= total debt /total capital*100 % 44

c)Time Interest Earn Ratio= EBIT/interest expanse time

s 8

4. Profitability Ratio

a) Gross Margin= gross profit /net sale*100 % 23

b) Operating Income to Sale=operating income/net sales*100 % 23

c) Margin before Interest & Taxes= EBIT/net sales*100 % 23

d) Margin before Taxes=EBT/net sales*100 % 0.16

©Prepared By Mohammad Abdullah Shah Bukhari Institute Of Management Sciences University Of Balochistan Quetta

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e) Net Profit Margin, Return on sale ratio=net incom/net sales*100 % 11

f) Return on Asset=EBIT/avg total assets *100 % 10

g) Return on total asset=net income/avg total assets*100 % 5

h) Return on total capital=EBIT/total capital*100 % 11

i) Return on equity=EBT/avg stockholder's equity *100 % 11

j) Return on equity=net income /avg stockholder's equity*100 % 8

k) Return on cs = net income- ps dividend/avg cs. equity*100 % 8

5. Investor specific ratios

a) Earning per share= net income-ps. dividend/outstanding cs. shs 4.51

b) %age of earning retained= net income-all dividend / net income*100 % 71

c) Price earning ratio= market price per share/eps*100 % 346

d) Dividend payout ratio= dividend per common share/eps *100 % 29

e) Dividend Yield= dividend per common share /market price per share

*100 % 8

f) Book value per share= total stock holder's equity -(ps. equity + ps.

dividend in arrears)/ outstanding cs. shs 54.29

Degree of financial leverage= EBIT /EBIT-I % 1.15

Degree of operating leverage=DCL / DFL % 1.16

Degree of combine leverage=%age change in EPS/%age change in sales % 1.33

DuPont analysis using return on total asset:

return on total assets= net profit margin x total asset turnover % 4.69

Net income/avg. total assets = net income / net sales x net sales / avg. total

assets

DuPont analysis using return on operating assets:

Return on Operating asset = Operating profit margin x Operating asset

turnover

% 12.00

Operating income / Avg. Operating assets = operating income/ net sales x

net sales / avg operating assets