How are non-fund limits like Letters of Credit, Bank Guarantee, DPG, and APG limits fixed by the banks?

The assessment Letter of Credit, Bank Guarantee (BG), or Letter of Guarantee (LG) limits are fixed by banks based on the annual consumption of raw materials to be purchased against the Letter of Credit or Letter of Guarantee (Bank Guarantee). Ascertain from the customer the requirement of Consumption of Material (CM) per annum, which is to be…

How to study a Profit and Loss Statement?

[This article elucidates methods and techniques used in the  analysis of profit and loss statements, the Format of the operative statement, the meaning of gross profit, operating profit and net profit, depreciation, amortization, etc.] The profit and loss (P&L) statements are one of three financial statements that every public company issues quarterly and annually, along…

Solvency certificate why is it required?

Solvency is defined as the ability of an individual or entity to meet long-term financial commitments. A solvency certificate is a most important document that provides information about the financial stability of an individual or partnership firm or company. A solvency certificate is required for applying for tenders, obtaining contracts, Visa interviews, Legal/court matters like…

What are the Capital instruments permitted for receiving foreign investment in India?

 ‘Capital Instruments’ means monetary instruments in capital markets such as equity shares, debentures, preference shares and share warrants issued by a company. Indian companies are permitted to raise money by way of capital instruments for their operational purposes. The instruments issued in capital markets are listed below: Equity shares: Equity shares are the shares joint-stock…