Table of contentsPresentation of the companyFunctions of the Finance DepartmentPricing sectionPurchasing sectionInventory sectionCompany developmentInternship tasksIntroduction/Functions of the different departmentsAccounts reconciliationAnalysis of the TSLRAnalysis of the justifications of the operations departmentResearch report on the Impact of CNG Products on PetrochemicalsTheories/ Concepts LearnedComputer Concepts and ApplicationsBusiness and Professional SpeechFinancial ManagementEconomic Policy of PakistanBusiness Research MethodsAccounting Internship Report ConclusionRecommendationsWorks CitedCompany OverviewI will begin my Accounting Internship Report essay with an overview of the The company in which I worked temporarily - AMAC. AMAC was established in 2006. It is engaged in the services, supply, distribution and marketing of petroleum and petrochemical products. It has expertise in the fuels and lubricants industry. Having been in the sector for ten years and having worked for market leaders such as Shell and Chevron, AMAC has extensive experience in this field. The company obtained its National Tax Certificate in July 2007 and also registered for General Sales Tax (GST) in May 2008 to expand its operations nationwide; AMAC has also registered under the Companies Act, 1984 as a Limited Liability Company in Pakistan since February 2012. AMAC PVT LTD worked with Shell Pakistan Lubricants as a registered agent in 2013 and 2014. Then resigned as an agent to acquire Chevron Pakistan Lubricants' distribution vessel in late 2014, and now works as an authorized industrial distributor. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get the original essayFunctions of Finance DepartmentThe Finance Department is one of the most important departments in AMAC. This department is simply responsible for controlling the operations taking place inside and outside the AMAC House, mainly at the terminals all over Karachi. This department is responsible for accounting for product purchases, hospitality, cost analysis and profitability of products, in addition to this it also accounts for transshipments and sales that are carried out by tankers , rails and pipelines to different depots in the country. This department also manages the audit and recovery of PDCs from the Government of Pakistan and carries out financial analyzes of new business opportunities emerging in the country. Another major function of this department is to set fuel prices monthly, fortnightly and, under certain conditions, on an as-needed basis. The entire department is subdivided into 3 subdivisions: Purchasing, Inventory and Pricing. During purchases, we also have hospitality income. The interdepartmental structure is as follows. Pricing Section Pricing includes the calculation of costs for regulated and deregulated products. Regulated products are those products whose prices are regulated by the Oil and Gas Regulatory Authority (OGRA) (such as PMG. Deregulated products are those products whose prices are determined by the oil marketing company itself (such as lubricants) in collaboration with the marketing department with an eagle eye on their competitor The cost plus margin technique is used to determine the selling prices and the OMC and dealers margin is set by. the Oil and Gas Regulatory Authority Inventory accounting is another.function of the financial department which involves the daily accounting of their stocks because AMAC has immense resources. storage capacity therefore plays an important role in decision making. It also makes it possible to control the balance of people responsible for operational activities related to stocks. For financial reporting purposes, FIFO (first in, first out) basis is also used to account for purchases. very important part of this department which involves ordering inventory at the appropriate level that does not incur unnecessary holding costs and receiving discounts through negotiations. This also involves accounting for Goods and Services Tax imposed by the Government of Pakistan on the purchase of products. Procurement Section The procurement section basically estimates the demand for oil in the Pakistani market and places orders to the refineries. They buy petroleum products on local and international markets. The process flow of the purchasing department basically starts with estimating the demand, placing the order and forecasting the next order. The department also manages the agreement of National Refinery Limited (NRL), Pak-Arab Refinery Limited (PARCO) and Attock Refinery. Limited (ARL), Bosicor Pakistan Limited (BPL) and Oil & Gas Development Corporation of Pakistan Limited (OGDCL). Some of the points mentioned below were found to be similar in the agreements. Purpose: Refineries must deliver their products that are on schedule and AMAC must purchase the products. Effective date and period: Effective date and period, start date and expiration date. of the agreement is mentioned.Product specifications: The quality and quantity of a specific product are mentioned by AMAC, the specified product must be received as per the agreement.Delivery: There are 3 delivery methods: Trucks -tankers, Tank Wagons, Pipelines .Sampling and Testing: Testing is carried out in the refinery laboratory, under the guidance of AMAC representative and a certificate is provided to AMAC before loading, this certificate is known as certificate of quality (COQ). In case the quality does not meet the requirements, an independent expert checks the quality of the product and then makes a report. Price: The price is set by the Oil and Gas Regulatory Authority (OGRA). Force Majeure: Delivery must be made on time, which is mentioned by AMAC in the contract. In the event of force majeure (strike, natural disaster, etc.), delivery may be delayed but AMAC must accept the petroleum product delivered by the refineries. Arbitration: In all cases, a dispute arises between the two parties. thus (1+1) arbitrators are hired by AMAC and other refineries to resolve the dispute between the two parties. The section on hospitality income deals with hospitality income from fuel storage tanks for other OMCs by charging rent on them, making it a kind of secondary functions such as management and accounting for hospitality income. As AMAC believes in the welfare of the whole society, it also allows small oil marketing companies that do not have much storage capacity to use their storage tanks for which AMAC charges them rent to cover maintenance and opportunity costs. This income is then recognized as other income in the income statement. Inventory Section In this section, there are two main functions regarding inventory management: Monitoring and accounting for Tank Stock Loss Report (TSLR) that occurs due to work procedures, temperature, density, Transfer betweenreservoirs (ITT) of the oil stock. Then, the TSLR reconciliation statement is established between the physical stock and the SAP stock. Inventory accounting involves daily accounting of their inventory as AMAC has immense storage capacity, therefore inventory accounting plays an important role in decision making. It also allows you to check the balance of the people responsible for operational activities related to the inventory. For financial reporting purposes, the first in, first out (FIFO) method is used to account for inventory. Ultimately, the comparative analysis of the same month's TSLR with the previous year's comparison is carried out in the form of reports. Business Development Common tasks that fall to this function include sourcing and diversifying into lucrative businesses, transactions, raising debt and equity financing, the most suitable location. from which the company can benefit, making capital structure decisions and providing insight into high-level strategic decisions such as entering a new market. At AMAC Finance, there is a large department with several ongoing missions. Different employees work on different assignments with one major goal i.e. transparency in all operations.Internship AssignmentsThe assignments given to me during my 6 weeks included the following.Introduction/Functions of different departmentsI started my first week of internship through the introduction, functions of all departments and their importance. The first week was mainly about observing different departments and how the departments coordinate with each other. At the end of the 1st week I was able to think about how all the departments in the company work together and there is a chain of command that goes from person A to person B and so on. Account Reconciliation Each month lubricant transactions are measured in two ways; one is done physically/manually, the other is done on QuickBook. At the end of each month, the two entries are compared, this is called reconciliation. The values ​​of the two records match, and if there is a difference, then an attempt can be made to justify it, in terms of a physical or computer error. Otherwise, the difference is called into question and must be justified. I was able to reconcile two months of August and September 2018. The analysis of TSLRTSLR stands for Tank Stock Loss Report in which losses/gains in oil are mentioned. The objective of this analysis was to determine the total loss/gain of a specific reservoir at a specific terminal. The tank net of each month was noted separately and was punched in the Excel sheet to prepare a proper analysis of the TSLR of the last financial year. Analysis of the justifications of the operations department In case of abnormal behavior of the performance of some specific terminals, the management Finance questions the operations department about the abnormal writing behavior. The operations department is required to respond to these justifications based on certain facts and figures. After receiving these justifications, they must be verified. If the answers are justifiable then the questions are deleted, others are then asked at the CFT meeting of the month.Research report on the impact of GNC products on petrochemicalsA research report was individually assigned to each trainee in finance, the topic I was assigned was the impact of CNG products on petrochemicals. We had to submit the report on the last day of our internship. It was suggested that we interview supervisors from differentfinancial departments, read articles and news, and surf the Internet to learn about the adverse effects of CNG products on petrochemicals. My report was prepared after interviewing many supervisors and researching online journals and articles, and I finally concluded that CNG has many positive points, one being the large amount of gas in the country, it is less harmful to the environment and the government. support with this. So, initially it had really affected the petrochemical sector, but as the decrease in government support for CNG, which can be observed recently by CNG prices, and the closure of CNG stations are once again leading to an increase in consumption gasoline/diesel. .Theories/Concepts learnedMy internship at AMAC was a great learning experience. This helped me get a practical insight into how departments work in such a busy organization. Finance being one of the most important departments in the purchasing process of AMAC, Private Limited, gave me a lot of experience. Computer Concepts and Applications I studied this course in my first semester and it really helped me because Microsoft Excel is a very important application. which is used in all organizations. While preparing the monthly reconciliation report, major help was gained from MS Excel, in which functions like VLOOKUP, SUMMATION, IF, AND & HLOOKUP were used. Other simple functions of MS Excel like creating tables, merging cells, etc. were used for other homework. I studied Business and Professional Speech during my 7th semester and it really helped me a lot because like most of the time the employees/supervisors spoke to me in English and I was able to respond to them confidently and clear manner, so that it was a two-way communication. When I took this course, my teacher helped me gain the confidence to speak more fluently.Financial ManagementThis course really helped me understand financial statements. One of the major issues constantly discussed with the interns to find a unique solution was that of circular debt that AMAC faces. I studied the concept of circular debt in financial management, which refers to the debt prevailing between different businesses. Each company is obligated to pay to the other company and depends on the other company to pay. In Financial Management, while preparing the report on Working Capital Management of Oil and Gas Marketing Companies, we also analyzed the decline in performance due to circular debt. Economic Policy of Pakistan Economic Policy of Pakistan was another important course that I studied and completed. important while being an intern in the finance department. By being informed of the purchases section, I discovered that the order for delivery of petrochemical products was placed at least 15 days before. Taking into account the economic conditions of the country, the estimated needs of the country are calculated and the order is placed. According to the confidential information provided, in the event of war, Pakistan could survive without oil supplies for the next 21 days. Therefore, the requirement is calculated to keep the country running for the next 21 days without any oil supplies. Business Research Methods As part of our internship, each finance intern was assigned a topic to research on a topic, the topic I was on. The assigned mission was “Impact of CNG products on POL products”. For this research, he