Financial management is that managerial activity which is concerned with the planning and controlling of the firm's financial resources and is also a vital area for the success of every business. This article attempts to study the financial management functions such as long-term asset mix, short-term asset mix and profitability in the cooperative sugar industry. For the purpose, Nadipisai Pulavar K R Ramasamy Cooperative Sugar Mill Ltd. (NPKRRCSML), was selected as the sample unit.

The sugar industry in India is the second largest agro-based processing industry in our country. It had a bumper production of 28.3 million tons in the year 2006-07. About 45 million sugarcane farmers and a large mass of agricultural laborers constituting 7.5% of the rural population are involved in the sugarcane cultivation, harvesting and ancillary activities. Besides, about 0.5 million skilled and semi-skilled workers, mostly from the rural areas, are engaged in the sugar industry. The sugar industry in India has been a focal point for socio-economic development in the rural areas by mobilizing rural resources, generating employment and higher income, and transport and communication facilities. However, to maintain its continuous growth in view of the globalization, the cooperative sugar industry in India has to face many challenges in the areas of productivity, cost-effectiveness, technical upgradation, by-products utilization like co-generation, distillery and ethanol production, professionalization of management and research and development activities, keeping a long-term perspective in mind. In these areas, sugar machinery manufacturers can play a vital role for the development of the Indian sugar industry. Financial performance of many sugar factories is not satisfactory and leads to incurring heavy losses. The NPKRRCSML, Thalainagar was selected as the sample unit for studying the financial management practices in the cooperative sugar industry. This mill was ranked 3^rd in terms of Return on Investment, 6^th in terms of Interest Coverage Ratio and 7^th in terms of Debt Equity Ratio among the 12 major cooperative sugar mills in Tamil Nadu.

The fixed assets turnover ratio indicates the effectiveness with which different assets are utilized in the industry. Turnover means the number of times the assets flow through a firm's operation into sales. The ratio also indicates the rate at which different assets such as land and buildings, plant and machinery, furniture and fixtures, etc., are turned over. A high ratio indicates high degree of efficiency in assets utilization and a low ratio indicates low degree of efficiency in assets utilization. If the ratio is too high, it indicates that the firm is overtrading on its assets. Further, in short-run fixed assets, turnover ratio can be a good indicator of efficiency because a firm cannot adjust its fixed assets for short-term market fluctuations. The standard ratio is 5 times in the manufacturing industry. WEST WICK suggested the application of fixed assets turnover ratio to measure the utilization of fixed assets. The formula for this ratio is:

Accounting World Magazine, Financial Management Practices, Co-Operative Sugar Mill, Nadipisai Pulavar K R Ramasamy Cooperative Sugar Mill Ltd. , NPKRRCSML, Sugar Industries, Sugarcane Cultivation, Socio-economic Development, Financial Management Practices, Debt Equity Ratio, Fixed Assets Management, Inventory Management, Business Enterprises.