The project reviews the financial reports of CARE India. It includes analysis of the financial position, major incomes and major expenditures of the non-profit organisation.
2. Table of Contents
Topic Page No.
Introduction to CARE India 3
Mission and Vision 4
Achievements 5
Financial Statements of CARE India
Receipts and Payments Account 8
Income and Expenditure Account 9
Analysis of Income and Expenditure Account 11
Balance Sheet 13
Analysis of Balance Sheet 15
Cash Flow Statement 17
Analysis of Cash Flow Statement 18
Analysis of the Financial Position 21
Analysis of the Major Drivers 23
Conclusion 24
References 25
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3. Introduction to CARE India
CARE is a not-for-profit organisation working in India for 70 years, focusing on alleviating
poverty and social injustice. We do this through well planned and comprehensive projects in
health, education, livelihoods and disaster preparedness and response. Our overall goal is the
empowerment of women and girls from poor and marginalised communities leading to
improvement in their lives and livelihoods.
CARE India with its 70 years of experience in providing relief during disasters and delivering
large-scale health programmes on the ground is well-positioned to support the affected citizens
where the need is the greatest. CARE India is part of the CARE International Confederation
working in over 100 countries for a world where all people live with dignity and security.
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4. Mission and Vision of CARE India
Mission
“CARE India helps alleviate poverty and social exclusion by facilitating empowerment of
women and girls from poor and marginalised communities.”
Vision
“CARE India seeks a world of hope, tolerance, and social justice, where poverty has been
overcome and people live in dignity and security.”
During FY 2019-20, CARE India directly reached out to 50.4 million people directly through 53
projects across 19 states, covering more than 90 districts. We are part of the CARE International
Confederation, working in 100 countries for a world where all people live with dignity and
security.
CARE focuses on the empowerment of women and girls because they are disproportionately
affected by poverty and discrimination; and suffer abuse and violations in the realisation of their
rights, entitlements and access and control over resources. Also, experience shows that, when
equipped with the proper resources, women have the power to help whole families and entire
communities overcome poverty, marginalisation, and social injustice.
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5. Achievements of CARE India
Year 2019
● Awards received by Khushi project: In January, two Anganwadi workers were selected by
the Ministry for Women & Child Development for the ‘National Awards for Exceptional
Achievements’. In June, Hindustan Zinc Limited, who funds the Khushi Project, was
awarded the CSR Health Impact Award 2019 for supporting this project, which was given
the title of ‘Game Changer’
Year 2018
● CRISIL awarded CARE India a ‘VO 1A’ rating, which indicates ‘Very Strong Delivery
Capability and High Financial Proficiency’
Year 2017
● The Digital Trailblazers Award at the Digital India Conclave organised by the India
Today Group in Patna, Bihar for using technology to provide state-of-the-art healthcare
services to the people of Bihar
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6. Year 2016
● Special Award by the State Government for notable contribution and support to the Kala
Azar Elimination Programme in Bihar.
● Ranked as India’s most trusted NGO in the Brand Trust Report India Study 2016, in a
study of 20,000 brands across 16 cities.
● AXA Global Corporate Responsibility Week Award for the ‘Where the Rain Falls’
(WtRF) Community Based Adaptation Project. This project helps Adivasi (tribal) women
and their communities to address climate change, with an emphasis on empowering girls
and women to better care for their household and family.
● Best Ooster Award at the Global Symposium on Health Systems Research, in Vancouver,
Canada for the development of an innovation that aimed to strengthen the teamwork and
motivation of the community health workers called Team-Based Goals and Incentives
(TBGI).
● Support from ‘Horlicks Ahaar Abhiyaan’ for the Briddhi project that worked towards
improving and providing nutrition support to children in West Bengal.
Year 2013
● Felicitation from Chief Minister of Uttarakhand for contribution in providing instant
relief to people affected in Uttarakhand floods.
● Tuberculosis Champion Award for the year 2013 in the individual category for IMPACT
Project. This award is supported by McGill University and Global Health Strategies to
recognize individuals and organisations who have done outstanding work for TB control,
care and support for patients.
● NGO Global Excellence Award in the category of Early Childhood Development and
Education. This project worked towards improving school readiness by providing support
to Anganwadi Workers through mobile technology.
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7. ● CARE India has made a considerable shift in its programming approach over the years.
From direct service provision to enabling poor and vulnerable groups, CARE India has
evolved into a rights-based organisation to address underlying causes of poverty. Our
focus is explicitly on the well-being, social position and rights of women and girls from
marginalised communities.
● CARE India focuses on developing the potential of women and girls to drive long lasting
equitable changes. We strategically emphasize on promoting quality healthcare, inclusive
education, gender equitable and sustainable livelihood opportunities and disaster relief
and preparedness.
● Our efforts are focused to fight against underlying causes of poverty, building secure and
resilient communities and ensuring a life of dignity for all women and girls from the most
marginalised and vulnerable communities, especially among Dalits and Adivasis.
● As we move ahead our key programming approach will continue to include social
analysis and action, gender transformative value chain approaches, leadership and life
skills strengthening, building capacities and leadership roles at multiple levels, advocacy
on national and international platforms and facilitating links and dialogues between
public, private, and civil society.
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8. Financial Statements of CARE India
The following are the financial statements of CARE India, along with their analysis:
Receipts and Payments Account
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11. Analysis of the Income and Expenditure Account
Income
● There has been an increase of 30% in the value of grants and donations received by the
organization. This cummalates to building up 94% of the total income received.
● Other incomes contribute to 6% of the total income including transactions of interest on
fixed deposits and savings accounts alongside miscellaneous incomes.
● The value of miscellaneous income has drastically decreased from ₹69,94,204 to
₹7,42,518 from FY 2019 to 2020.
● The organization managed to bring about an increase in the total income in the FY 2020
by earning an additional income of ₹68,22,060 from the previous financial year.
Expenditure
● The project expenses incurred by the organization are inclusive of transactions for salary,
wages, rent & repairs, communication & travelling, gratuity and provident fund, and
subgrants to the partners.
● Training material and legal fee requirements take up the maximum share of contribution
to the project expenses with an approximate share of 15%.
● Similar expenses are made in the sub-category of fund raising costs, and other
administrative expenses.
● Project expenses contribute to 87% of the total expenditure incurred by the organization
in the FY 2020 and approximately 83% in the FY 2019.
● There has been an increase in the value of depreciation charged by them on assets from
₹1,40,20,199 in FY 2019 to ₹2,14,63,449 in FY 2020.
● Alongside the increase in expenses, the expenditure occurred to raise funds by the
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12. organization has decreased by 26%.
● The total expenditure in FY 2020 was 1,97,87,53,293 from ₹1,92,73,34,839 in FY 2019.
This illustrated a change of 27% in the new financial year.
The excess of income over expenditure increased 86% from FY 2019 to 2020 showing a greater
surplus margin. After charging appropriations, they managed to offer earnings per share of
₹30,87,552 in the FY 2020 which is an increase of 61% in their offerings. This is highly
contributed by the significant increase in the income over expenditures in the past 2 working
years.
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15. Analysis of the Balance Sheet
Equity and Liabilities
● Taking into consideration the shareholder funds, the amount of share capital has not
changed, which means no new shares were issued during the financial year. The amount
was ₹200, indicating 20 equity shares of ₹10 each fully paid up. Their authorised capital
is ₹10,00,000 though.
● The reserves and surplus increased from ₹28,62,97,561 to ₹36,14,55,919, indicating that
the NGO has reinvested a great amount into the NGO itself. This increase in the amount
comes from the accumulated profits that a company has earned and retained from the
previous year. These included general fund, sustainability fund, asset fund account and
designated funds.
● Considering the non - current liabilities, the amount ₹6,24,11,190 has increased to
₹6,37,39,763 in the sub head long term provisions, which means the CARE ltd put aside
more money to provide for any type of liability which may arise in the future. The other
long term liabilities went from ₹19,13,013 to ₹12,11,088
● Taking up the current liabilities, the amount for trade payables certainly increased.
Especially the money due to micro and small enterprises which wasn’t present during the
FY 2019. The outstanding dues to creditors other than micro and small enterprises
decreased from ₹10,31,62,487 to ₹7,19,47,832 indicating that approximately 30% was
paid off during the year.
● The other current liabilities increased by approximately, 75%, which means there was
cash inflow on credit. These included Employee related payables, Unutilised grants etc.
The short term provisions also increased, which included employee benefits, gratuity,
compensated absences
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16. Assets
● The Fixed Assets of CARE Ltd, for the subhead of property, plant & equipment increased
from ₹2,87,72,806 to ₹4,37,59,050, which indicates an investment by the NGO. This
increase is mainly due to the increase in computers, furniture and fixtures. The intangible
assets went from ₹74,54,439 to ₹56,09,771.
● The fixed assets of the NGO also include items like office equipment and vehicles.
● The Intangible assets include software, which are divided into project assets and own
assets.
● Non Current Assets also include long term loans and advances which showed a decrease
from ₹88,61,145 to ₹80,29,095. These include security deposits and Income Tax and
TDS Receivable. These are for meeting long term finances.
● The current assets for the NGO include cash & cash equivalents, short term loans &
advances, and other current assets.
● The cash and cash equivalents increased from ₹61,03,28,023 to ₹94,39,22,605 indicating
that there was a cash inflow of more than 50% (approx). This included cash and a savings
account at a bank.
● Short term loans and advances decreased by multifold which means there was an outflow.
This subhead included security deposits, advance rent, grants receivable, TDS receivable,
loans and advances to employees & project advances.
● Lastly, the other current assets include gratuity plan assets, which showed an increase
from ₹28,71,516 to ₹30,73,958.
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18. Analysis of the Cash Flow Statement
Cash Flow from Operating Activities
The cash flow generated by operations has increased to an inflow of ₹33,89,44,916 in FY 20
from a negative cash flow of ₹3,04,74,090 in FY 19. The reasons for this are as follows:
● There is an increase in excess of income over expenses from ₹3,82,00,674 in FY 19 to
₹6,17,50,436 in FY 20.
● The fixed assets sold and considered as income in FY 19 have reduced the cash flow
from operating activities significantly whereas the same in FY 20 has no significant
impact.
● There is a decrease in loans and advances from a negative ₹1,93,24,494 in FY 19 to an
inflow of ₹9,70,84,928 in FY 20, causing an increase in cash inflow.
● There is an increase in provisions for employees benefits from a negative ₹71,19,787 in
FY 19 to a positive ₹43,98,370 in FY 20, causing an increase in cash inflow.
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19. ● There is an increase in other liabilities from a negative ₹11,09,71,500 in FY 19 to a
positive ₹18,74,11,255 in FY 20, causing an increase in cash inflow.
Other observations made are:
● The provision for gratuity has decreased from ₹1,95,74,355 in FY 19 to ₹69,35,637 in FY
20.
● Trade Payables have decreased from ₹4,70,10,510 in FY 19 to a negative ₹2,34,77,064 in
FY 20.
Cash Flow from Investing Activities
The cash flow generated by investing activities has decreased to an outflow of ₹53,50,334 in FY
20 from a positive cash flow of ₹58,97,803 in FY 19. The reasons for this are:
● There is an increase in purchase of fixed assets from ₹22,718,937 in FY 19 to
₹34,738,044 in FY 20, causing an increase in outflow of cash.
● There is a decrease in sale of fixed assets from ₹179,60,026 in FY 19 to ₹3,91,031 in FY
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20. 20, hence, a reduction in cash inflow.
Other observations include:
● Fixed Deposit of ₹18,00,00,000 was made and matured in FY 19. The interest earned on
the deposit was ₹1,06,56,714. Whereas, a fixed deposit of ₹1,136,100,267 was made and
matured in FY 20. The interest earned on the deposit was ₹28,996,679, higher than that
of FY 19.
Cash Flow from Financing Activities
The organization does not generate cash flow by financing activities.
Cash and Cash Equivalents
The overall cash and cash equivalents at the end of FY 20 have increased to ₹94,39,22,605 from
₹61,03,28,023 at the end of FY 19. This suggests that the organization has higher liquidity in FY
20 than it did in FY 19.
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21. Analysis of the Financial Position
In order to understand the financial position of the organization, we calculated various ratios
contributing to providing a better understanding regarding the solvency, profitability and
liquidity in their financial statements.
After analysing the financial statements such as the Receipts & Payments Account, the Balance
Sheet and the Income & Expenditure account, following are certain ratios calculated to
understand its financial position:
(all values are mentioned in Indian Rupees)
1. Debt Ratio = Average total debts/Average total assets
FY 2019: 64,324,203/765,326,137 = 0.085
FY 2020: 64,950,851/1,003,443,167 = 0.064
Hence it can be said that the organization has an abundance of assets available at its disposal to
raise debt by future borrowings. The debt ratio has reduced in the past financial year illustrating
borrowings made.
2. Contributions and Grants = Revenue from Contribution and Grants/ Total Revenue
FY 2019: 1,919,122,190/ 1,953,554,911 = 98%
FY 2020: 1,980,857,713/ 2,021,775,517 = 97%
The composition of the organization’s revenue comes majorly from its revenue from
contributions and grants made. This can help them understand their long and short-term needs to
source their funds accordingly. The percentage is approximately consistent for both the financial
years.
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22. 3. Current Ratio = Current assets/ Current Liabilities
FY 2019: 765,326,137 / 459,792,563 = 1.66
FY 2020: 1,003,443,167 / 634,434,113 = 1.57
The current ratio illustrates that the organization is having sufficient resources to handle their
short term financial obligations. An ideal current ratio is anywhere between 1.5 to 2 showing that
their financial position is stable.
4. Program Efficiency = Program service expenses / Total expense
FY 2019: 1,689,884,608 / 1,927,334,839 = 87.76%
FY 2020: 1,736,359,652 / 1,978,753,293 = 87.75%
Hence the ratio illustrates that the organization is successfully contributing to 87% of its mission
laid out with its efficiency in the program operations.
5. Viability Ratio = Net Assets / long-term debt
FY 2019: 305,533,574 / 64,324,203 = 4.75
FY 2020: 369,009,054 / 64,950,851 = 5.68
The ratio for both the Financial Years is higher than the recommended ratio. Hence the ratio
successfully illustrates that the organization has resources available and is liquid to pay its
institutional obligations for its future transactions.
Other than the above measurements the organization has Earnings per Share offering of
₹3,087,522 in the FY 2020 and of ₹1,910,034 in the FY 2019. This significant increase shows
that the organization has improved upon its operations towards their activities and is resulting in
higher reach towards its objective laid with maximum benefit and returns to the concerned
associates.
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23. Analysis of the Major Drivers of the NGO
The source of funds that the NGO backs on, the distribution of expenses made by them on
various undertaken activities and the allocation made by them on the sector their mission aims to
address positively. Following are the illustrations explaining the major drivers of the NGO in the
FY 2020 and 2019 respectively to receive a clear picture of their financial position. These
illustrations provide us with insights upon the factors that the NGO is most dependable upon to
successfully run its operations.
Financial Year 2020
Financial Year 2019
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24. Conclusion
CARE India was started with a mission of impacting 100 million people by 2030. As stated by
them, 89% of all their expenses are directly spent on their programme services offered across
various sectors such as health, education, livelihood and disaster relief. After conducting an
analysis of their financial statement to comment on the organization’s financial position, the
results were remarkably positive. The organization is successfully conducting its mission with a
structurally planned financial network managing all its resources optimally. According to its
performance in the past two Financial Years, they have managed to increase their earnings per
share alongside maintaining both short and long term liquidity by having sufficient assets to back
their current and future borrowings.
The organization has strategized well upon its sources of finance as they usually depend upon
donations and grants for the same. The stability in their financial position is illustrated by its
program efficiency ratio as the expenses are properly streamlined into various departments
managing to reduce their cost of raising funds. The proportion of assets and liabilities is also
highly reciprocated by its future scope of expansion matching its operational activities.
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