PAÍSES QUE NO MIEMBROS (OBSERVADORES)

Turnover Ratio

11.42 23.54 31.25 26.91

INTERPRETATION:

In 2011 the company has utilized good amount of working capital into the business towards sales. In 2012 -2013 there is not much utilization of working capital into the business but in 2014 the company has started to invest in working capital towards the working of the company.

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Comparative Statement Of The Company For The Year 2013 And2014

PARTICULARS 2014 2013 Amt %

Assets

Cash and cash equivalents 2258470 2284583 -26113 (1.16)

Short-term investments 1793165 1225435 567730 31.66

Total cash 4051635 3510018 541617 13.37

Receivables 1886273 1449151 437122 23.17

Inventories 1422373 1304242 118131 8.31

Deferred income taxes 632164 605884 26280 4.16

Prepaid expenses 511284 517454 -6170 (1.21)

Other current assets 4569875 4443006 126869 2.78

Total current assets 13073604 11829755 1243849 9.51 Gross property, plant and equipment 17093748 16611349 482399 2.82 Accumulated Depreciation -10382847

-10302189 -80658 0.78 Net property, plant and equipment 6710901 6309160 401741 5.99 Equity and other investments 4135599 5398518 -1262919 (30.54)

Other long-term assets 6429183 6280733 148450 2.31

Total non-current assets 17275683 17988411 -712728 (4.13)

Total assets 30349287 29818166 531121 1.75

Liabilities

Short-term debt 5497997 5951836 -453839 (8.25)

Accounts payable 1956505 1503072 453433 23.18

Taxes payable 153387 112801 40586 26.46

Accrued liabilities 1735930 1773233 -37303 (2.15)

Other current liabilities 1342395 1450048 -107653 (8.02) Total current liabilities 10686214 10790990 -104776 (0.98)

Long-term debt 7015409 6449220 566189 8.07

Deferred taxes liabilities 813221 810127 3094 0.38

Accrued liabilities 678677 668022 10655 1.57

Minority interest 570720 587653 -16933 (2.97)

Other long-term liabilities 225323 179783 45540 20.21 Total non-current liabilities 9303350 8694805 608545 6.54

Total liabilities 19989564 19485795 503769 2.52

Additional paid-in capital 898381 902810 -4429 (0.49)

Retained earnings 11568602 11835665 -267063 (2.31)

Treasury stock -1260425 -1261383 958 (0.08)

Accumulated other comprehensive -846835 -1144721 297886 (35.18) Total stockholders' equity 10359723 10332371 27352 0.26 Total liabilities and stockholders' eq 30349287 29818166 531121 1.75 Common Size Statement Of The Company For The Year 2013 And2014

PARTICULARS 2014 2013

Assets

Cash and cash equivalents 2258470 7.44 2284583 7.66 Short-term investments 1793165 5.91 1225435 4.11

Total cash 4051635 13.35 3510018 11.77

Receivables 1886273 6.22 1449151 4.86

Inventories 1422373 4.69 1304242 4.37

Deferred income taxes 632164 2.08 605884 2.03

Prepaid expenses 511284 1.68 517454 1.74

Other current assets 4569875 15.06 4443006 14.90

Total current assets 13073604 43.08 11829755 39.67 Gross property, plant and

FINDINGS:

 There is a fluctuation in the gross profit ratio. The percentage of gross profit over sales is gradually decreasing till 2012 and after which it is increased to 15.51 and 19.03 in 2013 and 2014. Thus it show an increasing trend from 2013 onwards. It is also apparent that the GP ratio is increasing about 4% from 2012-2013(11.81%-15.51%) and 2013-2014(15.51-19.03%), Hence it can be stimulated that between 2014 and 2015 there may be an increase in GP ratio of at least 4

 The Net Profit Ratio was 9.17% in 2010 which increased slightly to 9.30% in 2011.There is a decrease in Net profit Ration in 2012 to 8.19%. How ever, there is a increase of almost 3% in Net Profit Ration between 2013-2013 when it was 11.47%. Similarly there is an increase of 3% again for the next consecutive year in 2014 where the Net Profit Ration was 14.44%

 There is a fluctuation in the current ratio from 1.22 %in 2010 to 1.09% in 2011 to a decrease in 2012 to 1.94 and then an increase in 2013 to 1.06 and consecutively an increase again to 1.07 in 2014. But the current asset is well enough to meet current liability.

 The liquid Asset ratio was 1.04 in 2010 which has shown a gradual decrease to 0.92 % in 2011 to further decrease to 0.86% in 2012. Between 2012-2013 and 2013-2014 the Liquid Asset Ratio has remained stable at 0.89 % in both the financial years.

 The Inventory Turn over Ratio decreased from 7.50% in 2010 to 6.86% in 2011. How ever, it increased almost by 2% to 8.72% in 2012 but again had a gradual decrease to 7.77% in 2013 to further decrease to 7.37% in 2014.

 The Debtors Turn Over Ratio was 10.04% in 2010 which has increased to 13.10% in 2011 but then it was decreased drastically in 2012 to 9.29% but slowly is accelerating from 2013 on wards to 11.19% in 2013-14 and 10 12.61 in 2014.

 The creditor turn over ratio is 8.52% in 2010 which increased to 11.05% in 2011 but decreased to 7.30% I 2012 and then picked up to 8.82% in 2013 and increased in 2014 to 9.39%.

 The fixed asset ratio was 0.98 % in 2010 which decreased to 0.92% in 2011 and further decreased to 0.91 in 2012 and then to 0.89% in 2013. The fixed asset has shown a increasing trend in 2014 to 1. 61% This is far more than what it has been since 2010.

 The working capital in the year 2012 has decreased but by 2013-2014 there is an increase in the working capital ratio from 539615 to 872370 and 87230 to 1037021 which shows that the company has gained working capital in the year 2014 as it was on 2011

 In 2011 the company had working capital of 1.09 and has drastically decreased to 1.04 in 2012.Though there is a gradual increase in 2013 by 1.06, in 2014 the company has1.07 of working capital

 There is a fluctuation in the liquid ratio. The liquid assets are gradually decreasing in the year 2012 from .92 - .86. From the year 2013 there is no change in the liquidity position of the company which is .89 in 2013 and 2014

 This ratio shows that in 2011 the company has 7.47 and has increased the in 16.31 that shows that there is not much of working capital in the year 2012 invested to support the productivity of the company but over the year 2013 and 2014 there is lot of working capital invested in the productivity of the company.

 The amount of accounts receivables, inventory into the business extracts less sales in the year 2011. In 2012 there is relatively less amount of accounts receivables, inventory invested in the business and the position remains the same in the year 2013 but in 2014 it clearly depicts that there is certain amount of accounts receivables, inventory induced into the business.

 In 2011 the company has utilized good amount of working capital into the business towards sales. In 2012 -2013 there is not much utilization of working capital into the business but in 2014 the company has started to invest in working capital towards the working of the company.

SUGGESTIONS:

1) Toyota should continue to undertake concerted efforts to strengthen its management platform and raise corporate value.

2) As immediate tasks, Toyota should promote business and cost structure reforms to realize a solid management platform so that it can respond quickly to the changing market circumstances.

Specifically, Toyota should maintain a streamlined structure through the reduction of fixed costs and enhance its business in established markets in developed countries.

3) Toyota should accelerate its business expansion into rapidly growing emerging countries by thoroughly and meticulously monitoring market conditions in respective regions and introducing products suited to the characteristics and needs of each market. Toyota should also strive to establish production and supply structures to realize optimum product pricing and delivery, and to enhance the value chain to provide a wide range of customer services in each country and region.

4) Toyota should consider making Lexus a priority in the Chinese market. This will enable it to become competitive with other car manufacturers in the luxury segment. By increasing

production facilities in Asia, this will enable Toyota to have cheaper delivery channels and become closer to the emerging market customer. Toyota should also cut out layers of middle management so that engineers get more authority over what specific customer needs are answered in the design and development of a new car.

5) Toyota should pursue the development of environmentally conscious, energy-saving products while incorporating functions and services demanded by customers (value chain) and delivering them to the global market. Acting on these measures, Toyota should aim for growth in three business units, namely, “solutions” in the areas of materials handling equipment, logistics and textile machinery; “key components” in the fields of car air-conditioning compressors and car electronics; and “mobility” in the domains of vehicles and engines.

6) To support consolidated management on a global scale, Toyota should enhance the power of the workplace and diversity in the use of human resources, and strive to nurture global human resources.

7) In addition to placing top priority on safety, Toyota should thoroughly enforce compliance, including observance of laws and regulations, and actively participate in social contribution activities.

8) Toyota should aim to support industries and social infrastructures around the world by continuously supplying products and services that anticipate customers’ needs in order to

Conclusion

Study of ratio analysis of Toyota reveals the financial performance of the company. It is found from analysis of the four financial years from 2010 to 2014, the company’s Gross Profit has increased in 2013-14 and so is the Net Profit. The Current Ratio is also increasing since 2013 14 and 2014-15 and that the current assets are more than sufficient to meet the current liability.

The ideal liquidity ratio needs to be at least 1: 1 but it is only 0.89% which is low. Hence the company needs to improve its liquidity position. The Inventory Turnover Ratio decreased from which means that stock is sold out or utilized by the company. However, it increased almost by 2% to 8.72% in 2012 where there may have been less sales and stock increase, but again had a gradual decrease to 7.77% in 2013 to further decrease to 7.37% in 2014 which shows very clearly that Toyota is increasing its sales and thus reducing its stock which is a very positive trend for the company. Since both the Debtors turnover ratio and the Creditor turnover ratio is both showing the same trend of from increased trend to an decreased trend, it clearly implies that the company is making sales but at the same time the companies burrowing is also increasing.

The positive side of the finance of Toyota is that since the sale is going up, the company is in a position to repay it loans and borrowings comfortably.

The very clear indicator that the company is on the positive trend is its fixed asset ratio.

In Toyota, the fixed assets are increasing which means that the company is buying raw materials and assets required for the growth. There is money available and hence the company is able to increase it fixed assets and through this the company can increase its overall financial position.

The working capital was not utilized in 2012 but it has been utilized in 2013 and 2014 and this has resulted in the productivity of the company. Thus it is very apparent that working capital needs to be utilized to increase the productivity of the company. The liquidity assets show a declining trend in 2011-12 and the company is trying to maintain it liquidity assets in 2013-14 but this needs to be strengthen even further. Although the accounts receivables is high the money has not be utilized to increase productivity. The working capital of the company needs to be utilized to increase productivity and profitability of the company. The company has started to utilize this and hence we can anticipate that the company will have more productivity and the

financials will improve further. We can conclude by saying the company is moving towards a very positive trend and 2014-2015 will be a productive year for the company.