Case let 3. Mr. Garv is an engineer and wants to invest in HCL Limited. It was the first time when Mr. Garv selected a company to make investments in equities. Earlier, he had made investments in fixed deposits or safe securities. Mr. Garv has the financial statements of HCL Limited for the years 2021 and 2020. The following is the balance sheet of HCL limited given below.

HCL LIMITED Condensed Balance Sheet, March 31

Assets Property, plant, and equipment Capital work in progress

Intangible assets

Non-current investments

Long term loan Differed tax assets net Other non-current assets

Non-current assets

inventories Current investments Trade receivables Cash and cash equivalents Short term loans Other current assets Current assets Total assets Equity and liabilities Equity 117009

2021 (Rs. in millions) 46296

6631 19338

1456

5194 2853 135

1197

10690 2498

947

592

14727 22718 9309 24395 11946 68368 200104

2020 (Rs. in millions) 41837 5290

11933

1456

4181 2450 64

67211 25699 21022 41012 18724 10747

1563

 118767 185978 

 98531 14315 2733 

779

1407

19234 21857 8673 26244 11439 68213 185978

81903 25799 21122 41667 18358 10058

118201 200104 

borrowings Other equity

Long term provisions

Differed tax liabilities Non-current liabilities Short term borrowings Tax payables

Other current liabilities Short term provisions Current liabilities Total equity and liabilities

You are required to help Mr. Garv by providing the following information:

3.1 Comment on the firm performance by using horizontal analysis (Just consider the bold items). (15 Marks) 3.2 Which year is better in terms of firms liquidity and solvency? (10 Marks)

Case let 4. Suggest the inventory valuation methods and depreciation methods to HCL limited with hypothetical illustrations. (15 Marks)