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WHAT IS THE BASIS TO CALCULATE MODIFIED MPBF??

This query is : Resolved 
 

(Querist)
03 November 2010

Dear All

Kindly let me know the method to calculate MPBF under the modified MPBF System.

Happi Deepawali and thanks


Rajan Kapoor (Expert)
08 November 2010

MPBF is given below by following two methods.

FIRST Method of Lending
1 Total Current Assets
[ T1 in Form-IV ]

2 Current Liabilities [Other than bank borrowing]
[ T2 in Form-IV ]

3 Working Capital Gap [WCG]
[ 1 - 2 ]

4 Minimum Stipulated Net Working Capital
[ 25% of WCG excluding export receivables]
[ (item 3 above - item no. 6 in Form - IV)*0.25 ]

5 Actual / Projected Net Working Capital [ NWC ]
[ T22 in Form-III ]

6 Item no. 3 minus Item no. 4

7 Item no. 3 minus Item no. 5

8 Maximum permissible bank finance [MPBF]
[ least of item 6 or 7 above ]

9 Excess borrowings representing shortfall in NWC
[ item 4 - item 5 ]


SECOND Method of Lending
1 Total Current Assets
[ T1 in Form-IV ]

2 Current Liabilities [other than bank borrowings]
[ T2 in Form-IV ]

3 Working Capital Gap (WCG) (1-2)
[ 1 - 2 ]
4 Minimum Stipulated Net Working Capital
[25% of total Current Assets excluding export receivables]
[ (1 above - item 6 in Form-IV)*0.25 ]

5 Actual / Projected net working capital
[ T22 in Form-III ]

6 Item no. 3 minus Item no. 4

7 Item no. 3 minus Item no. 5

8 Maximum permissible bank finance [MPBF]
[ least of item 6 or 7 above ]

9 Excess borrowings representing shortfall in NWC
[ item 4 - item 5 ]



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