INTRODUCTION The basic object of accounting is to provide information to the interested parties. Accounting information is required by the persons inside the organisation and also by the outsiders, such as government, creditors, bankers, customers etc. On the basis of information based on accounting, important decisions are taken. The decisions of economic resource allocation is primarily based on the accounting information. The financial accounting system provides the basic information useful to the businessman. Accounting may be classified as follows:      1.    Financial Accounting 2.   Cost Accounting 3.     Management Accounting Financial accounting provides information about the income, expenditure, profits, losses and the financial position of the Organisation. This information is helpful to the management to control the major function of the business i.e. finance, production distribution etc. However, financial statements are historical because they belong to past

The term Capital Budgeting  refers to the long-term planning for proposed capital outlays or expenditure for the purpose of maximizing return on investments. The capital expenditure may be: 1.      Cost of mechanization, automation and replacement. 2.      Cost of acquisition of fixed assets, e.g., land, building and machinery etc. 3.    Investment on research and development. 4.     Cost of development and expansion of existing and new projects. DEFINITION OF CAPITAL BUDGETING Capital Budget is also known as “Investment Decision Making or Capital Expenditure Decisions” or “Planning Capital Expenditure” etc. Normally such decisions where investment of money and expected benefits arising therefrom are spread over more than one year, it includes both raising of long-term funds as well as their utilization. Charles T.Horngnen has defined capital budgeting as “Capital Budgeting is long-term planning for making and financing proposed capital outlays.” In other words, capital bud

 ➤  1.  Establishment The International Finance Corporation was established in 1956 to encourage private enterprises and to increase the rate of economic development. The private enterprise is mainly responsible for very high rate of economic development in developed countries. In undeveloped in undeveloped countries, the projects of private competitive enterprises are not in existence on large scale. It is one of the reasons of slow economic growth of these countries. One of the economic backwardness of newly independent countries was that they have to wait for very long time for beginning the process of rapid economic development. There was worry of the failure of democratic system because of the different approach of private enterprises. ➤ 2. Objectives The IFC is an associate institution of the IBRD. Their objects are similar to that of objectives of IBRD. Following are the important objectives of IFC-   1.  To encourage foreign 2.  To enterprises private enterprises The IFC un

1. Establishment The IBRD was established in 1944. The first half of the 20 th Century was of uncertainties at levels in social, economic and political fields. Developed countries in Europe were eager to increase the size of their kingdom. The world economy was badly affected because of this approach. It resulted in World Depression in 1929. Immediately after Second World Was it was essential to help the countries to come out of social, political and economic difficulties. In order to remove these difficulties the IBRD was established. The important tasks before the IBRD were:- 1. Reconstruction of economies of countries involved in Second World War. 2. Economic Development of countries. The government of India also faces the same problems of reconstruction and development of Indian economy immediately after independence. 2.  Objectives Objectives of IBRD are:- 1.   To achieve economic development of countries. 2.   To undertake reconstruction of countries. 3.   To remove