PROJECT REPORT
Project Report, as name suggest, is simply document that provide details about project such as manufacturing process, machinery and equipment’s, requirement of of raw materials, etc. and information regarding economic, technical, financial, production aspects, etc.
MEANING OF CMA REPORT
Credit Monitoring Arrangement, commonly known as CMA Data is the financial report used by lending institutions to appraise and analyse the financial position of a company before lending. Under the present rules, the Reserve Bank of India has mandated all banks to prepare CMA for lending to large borrowers. Hence, CMA data is required for project loans, term loans and for working capital limits.
Difference between Project Report and CMA Data :
| Project Report | CMA Data |
|---|---|
| It mainly focuses on determining viability of project i.e. its ability to work successfully. | It mainly focuses on determining borrowing capacity of entity. |
| It does not have a specific format. | It has a specific format. |
| Factors affecting project report include time complexity, difficulty in understanding, improper risk management, etc. | Factors affecting CMA Data include time complexity, improper analysis, fund related issues, complex paperwork, etc. |
| Its benefits include identifying risks, cost management, control of project, increase project success, etc. | Its benefits include effectively use of funds, analysis of both current and non-current assets, liabilities, determine financial position, etc. |
| Its main objective is to current track progress of project and then compare it with original plan so that so that risk can be identified and corrective action can be taken. | Its main objectives is to provide financial blueprint of performance of company or organization and ensures that funds are used effectively. |
| It includes manufacturing process, requirements of power and water, need of manpower, machinery and equipment, prices and specifications, etc. | It include information such as operation statement, ratio analysis, comparative statement of current asset and current liabilities, fund flow statement, etc. |
| It is generally submitted to bankers by organization or company. | It is generally submitted to bankers, venture capitalist, PE investor, etc. |
| It is less difficult to understand and handle than CMA data. | It is more difficult to understand and handle than project report. |
FORMAT AND CONTENTS OF PROJECT REPORT/CMA REPORT
The format of Project Report/CMA Data is generally fixed, and it contains preceding two years actual performance, ongoing year estimated figures and next five years projections
It contains detailed
- Profit and Loss Account
- Cash Flow Statement
- Ratio Analysis
- Balance Sheet
- Fund Flow Statement
- Analysis of Maximum Permissible Bank Finance