TO THE MEMBERS OF NHPC LIMITED
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statementsof NHPC LIMITED ("the Company") which comprise the Balance Sheet as at31st March 2017 the Statement of Profit and Loss (including Other Comprehensive Income)the Statement of Cash flows and the Statement of Changes in Equity for the year accountingpolicies and other explanatory information (hereinafter referred to as "StandaloneInd AS financial statements).
Management's Responsibility for the Standalone Ind AS FinancialStatements
The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation of these standalone Ind AS financial statements that give a true and fairview of the state of affairs (financial position) profit (financial performance includingother comprehensive income) cash flows and changes in equity of the Company in accordancewith the accounting principles generally accepted in India including the IndianAccounting Standards (Ind AS) prescribed under Section 133 of the Act read with relevantrules issued thereunder.
This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone Ind AS financial statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these standalone Ind ASfinancial statements based on our audit.
We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made thereunder.
We conducted our audit of the standalone Ind AS financial statements inaccordance with the Standards on Auditing specified under Section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the standalone Ind AS financialstatements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence aboutthe amounts and the disclosures in the standalone Ind AS financial statements. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material statements whether due to fraud or error. misstatementofthestandaloneIndASfinancial In making those risk assessments the auditor considersinternal financial control relevant to the Company's preparation of the standaloneInd AS financial statements that give a true and fair view in order to design auditprocedures that are appropriate in the circumstances. An audit also includes evaluatingthe appropriateness of accounting policies used and the reasonableness of the accountingestimates made by Company's Directors as well as evaluating the overall presentationof the standalone Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the standalone Ind AS financialstatements.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone Ind AS financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India including the IndAS of the state of affairs (financial position) of the Company as at 31st March 2017its profit (financial performance including other comprehensive income)its cash flows andchanges in equity for the year ended on that date.
Emphasis of Matters
We draw attention to the following matters in the Notes to thestandalone Ind AS financial statements:
|Sl. No. Matter ||Management's Reply |
|(a) Note no. 2.2 para 2 to the standalone Ind AS financial statements regarding expenditure incurred for conducting survey and investigation on projects either provided for on account of uncertainty about the outcome or being carried forward pending clearance with various authorities. ||(a) In the opinion of the management the projects on which survey & investigation expenditure is incurred are still active and accordingly the expenditure incurred is being carried forward. However provision wherever considered necessary has been made in the books. |
|(b) Note No. 22 para 1 to the standalone Ind AS financial statements regarding the stay from Hon'ble High Court of Delhi against the implementation of stoppage of Personal Pay Adjustment (fitment benefits) recovery from below Board level executives ||(b) NHPC Officers Association has got stay from Hon'ble High Court of Delhi against the implementation of stoppage of Personal Pay Adjustment recovery. In view of the directions of the Hon'ble High Court Personal Pay Adjustment is being paid along with the salary. |
|(c) Note No. 34 para 1 to the standalone Ind AS financial statements regarding the uncertainty related to the outcome of the claims/ arbitration proceedings and lawsuit filed by/ against the Company on/ by contractors and others. In some of the cases the arbitration award has been decided against the Company/ lost in lower courts and the company is pursuing the matter in higher courts. Management does not envisage any possible outflow in respect of decisions against the company other than those already provided for in the books of account. ||(c) This disclosure in the ibid para has been made in compliance of provisions of Ind-AS 37 (Provisions Contingent Liabilities and Contingent Assets). |
|(d) Note No. 34 para 13 to the standalone Ind AS financial statements regarding the various balances which are subject to reconciliation/ confirmation and respective consequential adjustments. ||(d) Disclosure through note is a statement of fact. |
|(e) Note No. 34 para 28 to the standalone Ind AS financial statements regarding Kotlibhel-IA project the fate of which depends upon suit pending adjudication before the Hon'ble Supreme Court of India. ||(e) Disclosure through note is a statement of fact. |
Our opinion is not modified in respect of these matters.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016 ("theOrder") issued by the Central Government in terms of sub- section (11) of Section 143of the Act we give in the "Annexure A" a statement on the matters specified inthe paragraphs 3 and 4 of the Order.
2. The Comptroller and Auditor General of India has issued directions indicating theareas to be examined in terms of sub- section (5) of Section 143 of the Act thecompliance of which is set out in "Annexure B".
3. As required by Section 143 (3) of the Act we report that:
(a) we have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit;
(b) in our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books;
(c) the Balance Sheet the Statement of Profit and Loss the Statement of Cash Flowsand the Statement of Changes in Equity dealt with by this Report are in agreement with thebooks of account;
(d) in our opinion the aforesaid standalone Ind AS financial statements complyspecified under Section 133 of the Act read with relevant rules issued thereunder.
(e) in terms of Notification No. G.S.R. 463(E) dated 05th June 2015 issued by theMinistry of Corporate Affairs the provisions of Section 164 (2) of the Act regardingdisqualification of directors are not applicable to the Company;
(f) with respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure C"; and
(g) with respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 read withCompanies (Audit & Auditors) Amendment Rules 2017 in our opinion and to the best ofour information and according to the explanations given to us:
(i) the Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements Refer Note 34 Para 1 to thestandalone Ind AS financial statements;
(ii) the Company did not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses;
iii) there has been no delay in transferring amounts which were required to betransferred to the Investor Education and Protection Fund by the Company.
Iv) the Company has provided requisite disclosures in its standalone Ind AS financialstatements as to holdings as well as dealings in Specified Bank Notes during the periodfrom 8th November 2016 to 30th December 2016 in Note 34 para 17 to the standalone Ind ASfinancial statements. Based on audit procedures and relying on the managementrepresentation we report that the disclosures are in accordance with books of accountmaintained by the Company.
|For S N Dhawan & Co. LLP ||For Gupta Gupta & Associates ||For Ray & Ray |
|(Chartered Accountants) ||(Chartered Accountants) ||(Chartered Accountants) |
|FR No. 000050N/N500045 ||FR No. 001728N ||FR No. 301072E |
|(S.K. KHATTAR) ||(VASU GUPTA) ||(BARUN KUMAR GHOSH) |
|Partner ||Partner ||Partner |
|M. No. 084993 ||M. No. 537545 ||M. No. 051028 |
|Place : New Delhi || || |
|Date : 30th May 2017 || || |