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NTPC Ltd.

BSE: 532555 Sector: Infrastructure
NSE: NTPC ISIN Code: INE733E01010
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OPEN 91.50
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VOLUME 317840
52-Week high 133.50
52-Week low 74.00
P/E 8.92
Mkt Cap.(Rs cr) 90,238
Buy Price 91.20
Buy Qty 6558.00
Sell Price 91.45
Sell Qty 760.00
OPEN 91.50
CLOSE 91.00
VOLUME 317840
52-Week high 133.50
52-Week low 74.00
P/E 8.92
Mkt Cap.(Rs cr) 90,238
Buy Price 91.20
Buy Qty 6558.00
Sell Price 91.45
Sell Qty 760.00

NTPC Ltd. (NTPC) - Auditors Report

Company auditors report

To

The Members of NTPC Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the Standalone Financial Statements of NTPC Limited ("theCompany") which comprise the Balance Sheet as at 31 March 2019 the Statement ofProfit and Loss (including Other Comprehensive Income) the Statement of Changes in Equityand the Statement of Cash Flows for the year then ended and notes to the financialstatements including a summary of the significant accounting policies and otherexplanatory information (hereinafter referred to as "Standalone FinancialStatements").

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Financial Statements give the information requiredby the Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in India ofthe state of affairs (financial position) of the Company as at 31 March 2019 and itsprofit (financial performance including other comprehensive income) changes in equity andits cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Standalone FinancialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the Standalone Financial Statementsunder the provisions of the Act and the Rules there under and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion.

Emphasis of Matter

We draw attention to the following matters in the notes to the Standalone FinancialStatements:

(a) Note No. 32(a) regarding billing and recognition of sales on provisional basispending disposal of the Company's petition before CERC on the measurement of GCV of coalon ‘as received' basis measured on wagon top at the unloading point on theadjustment of loss of GCV for the period 2014-19 and other related matters as mentioned inthe said note.

(b) Note No. 42 in respect of a Company's project consisting of three units of 800MWeach where the order of NGT has been stayed by the Hon'ble Supreme Court of India; thematter is sub-judiced and the units have since been declared commercial.

(c) Note No. 57(iii)(b) with respect to appeal filed by the company with the Hon'bleHigh Court of Delhi in the matter of Arbitral award pronounced against the company and therelated provision made/disclosure of contingent liability as mentioned in the said note.

Our opinion is not modified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Financial Statements of the current period.These matters were addressed in the context of our audit of the Standalone FinancialStatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. For each matter below description of how our auditaddressed the matter is provided in that context. We have determined the matters describedbelow to be the key audit matters to be communicated in our report.

Key Audit Matter How our audit addressed the Key Audit Matter
1. Recognition and Measurement of revenue from Sale of Energy We have obtained an understanding of the CERC Tariff Regulations orders circulars guidelines and the Company's internal circulars and procedures in respect of recognition and measurement of revenue from sale of energy comprising of capacity and energy charges and adopted the following audit procedures:
The company records revenue from sale of energy as per the principles enunciated under Ind AS 115 based on tariff rates approved by the Central Electricity Regulatory Commission (CERC) as modified by the orders of Appellate Authorities. However in cases where tariff rates are yet to be approved provisional rates are adopted considering the applicable CERC Tariff Regulations. - Evaluated and tested the effectiveness of the Company's design of internal controls relating to recognition and measurement of revenue from sale of energy.
This is considered as key audit matter due to the nature and extent of estimates made as per the CERC Tariff Regulations which leads to recognition and measurement of revenue from sale of energy being complex and judgemental. - Verified the accounting of revenue from sale of energy based on tariff rates approved by the CERC as modified by the orders of Appellate Authorities. In case of power stations where the tariff rates are yet to be approved provisional rates are adopted in accordance with the principles given in the CERC Tariff Regulations.
(Refer Note No. 32 to the Standalone Financial Statements read with the Significant Accounting Policy No. C.15) Based on the above procedure performed the recognition and measurement of revenue from sale of energy are considered to be adequate and reasonable.
2. impairment assessment of Property Plant and Equipment (PPE)
The Company has a material operational asset base (PPE) relating to generation of electricity and is one of the components for determining the tariff as per the CERC Tariff Regulations which may be vulnerable to impairment. We have obtained an understanding and tested the design and operating effectiveness of controls as established by the Company's management for impairment assessment of PPE.
We considered this as a key audit matter as the carrying value of PPE requires impairment assessment based on the future expected cash flows associated with the power plants (Cash generating units). We evaluated the Company's process of impairment assessment involving valuation experts to assist in assessing the appropriateness of the impairment model including the independent assessment of discount rate economic growth rate terminal value etc.
(Refer Note No. 56(a) to the Standalone Financial Statements read with the Accounting Policy No. C.20) We evaluated and checked the calculations of the cash flow forecasts prepared by the Company taking into consideration the CERC (Terms and Conditions of Tariff) Regulations 2019 (applicable for the tariff period of 5 years from 1 April 2019 to 31 March 2024) along with the aforementioned assumptions.
3. Deferred Tax Asset relating to Mat Credit entitlement and corresponding regulatory deferral Liability Based on the above procedures performed we observed that the Company's impairment assessment of the PPE is adequate and reasonable.
The company has recognised deferred tax asset relating to MAT credit entitlement. Utilisation of MAT credit will result in lower outflow of Income Tax in future years and accordingly Regulatory Deferral Liability corresponding to the said MAT credit entitlement has also been recognised We have obtained an understanding for recognition of deferred tax asset relating to MAT credit entitlement and corresponding liability of the same in Regulatory Deferral Account including the management's judgement.
Payable to the beneficiaries in subsequent periods as per We further assessed the related forecasts of future CERC Tariff Regulations. The recoverability of this deferred taxable profits and evaluated the reasonableness of the tax asset relating to MAT credit entitlement is dependent considerations/assumptions underlying the preparation upon the generation of sufficient future taxable profits of these forecasts. We have also verified the regulatory to utilise such entitlement within the stipulated period deferral account balance corresponding to the said MAT prescribed under the Income Tax Act1961. credit payable to the beneficiaries in subsequent periods.
Payable to the beneficiaries in subsequent periods as per CERC Tariff Regulations. The recoverability of this deferred tax asset relating to MAT credit entitlement is dependent upon the generation of sufficient future taxable profits to utilise such entitlement within the stipulated period prescribed under the Income Tax Act1961. We further assessed the related forecasts of future taxable profits and evaluated the reasonableness of the considerations/assumptions underlying the preparation of these forecasts. We have also verified the regulatory deferral account balance corresponding to the said MAT credit payable to the beneficiaries in subsequent periods.
We identified this as a key audit matter because of the importance of this matter to the intended users of the Financial Statements and its materiality; and requirement of judgement in forecasting future taxable profits for recognition of MAT credit entitlement considering the recoverability of such tax credits within allowed time frame as per the provisions of the Income Tax Act1961. Based on the above procedures performed the recognition and measurement of Deferred tax asset relating to MAT credit entitlement and corresponding Regulatory Deferral Liability towards beneficiaries are considered adequate and reasonable.
(Refer Note No. 18 25 48 & 65 to the Standalone Financial Statements read with the Accounting Policy No. C.4 and C.18)
4. Contingent liabilities
There are a number of litigations pending before various forums against the Company and the management's judgement is required for estimating the amount to be disclosed as contingent liability. We have obtained an understanding of the Company's internal instructions and procedures in respect of estimation and disclosure of contingent liabilities and adopted the following audit procedures:
We identified this as a key audit matter because the estimates on which these amounts are based involve a significant degree of management judgement in interpreting the cases and it may be subject to management bias. - understood and tested the design and operating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases;
(Refer Note No. 69 to the Standalone Financial Statements read with the Accounting Policy No. C.13) - discussed with the management any material developments - and latest status of legal matters;
- read various correspondences and related documents pertaining to litigation cases and relevant external legal opinions obtained by the management and performed substantive procedures on calculations supporting the disclosure of contingent liabilities;
- examined management's judgements and assessments whether provisions are required;
- considered the management assessments of those matters that are not disclosed as the probability of material outflow is considered to be remote;
- reviewed the adequacy and completeness of disclosures;
Based on the above procedures performed the estimation and disclosures of contingent liabilities are considered to be adequate and reasonable.

Other Matter

We audited the adjustments as fully described in Note No. 47(A) to the StandaloneFinancial Statements which have been made to the comparative Standalone FinancialStatements presented for the years prior to year ended 31 March 2019. In our opinion suchadjustments are appropriate and have been properly applied.

Information Other than the Standalone Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the Corporate Governance Report (but does notinclude the Standalone Financial Statements and our auditor's report thereon) which weobtained prior to the date of this auditor's report (hereinafter referred to as ‘CGreport') and the information included in the Director's Report including AnnexuresManagement Discussion and Analysis Business Responsibility Report and other companyrelated information (hereinafter referred to as ‘Other reports'). The Other reportsare expected to be made available to us after the date of this auditor's report.

Our opinion on the Standalone Financial Statements does not cover the other informationand we do not and will not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information identified above when it becomes available and in doingso consider whether the other information is materially inconsistent with the StandaloneFinancial Statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.

If based on the work we have performed on the other information included in the CGreport that we obtained prior to the date of this auditor's report we conclude that thereis a material misstatement of this other information we are required to report that fact.We have nothing to report in this regard.

When we read the ‘Other reports' if we conclude that there is a materialmisstatement therein we are required to communicate the matter to those charged withgovernance and take appropriate actions if required.

Responsibilities of Management and Those Charged with Governance for the StandaloneFinancial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Act with respect to the preparation of these Standalone Financial Statementsthat give a true and fair view of the financial position financial performance totalcomprehensive income changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) prescribed under Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the Standalone Financial Statements that give a true andfair view and are free from material misstatement whether due to fraud or error.

In preparing the Standalone Financial Statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

The Board of Directors is also responsible for overseeing the Company's financialreporting process.

Auditor's responsibilities for the Audit of the standalone financial statements

Our objectives are to obtain reasonable assurance about whether the StandaloneFinancial Statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these Standalone Financial Statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the StandaloneFinancial Statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the company hasadequate Internal Financial Controls with reference to Standalone Financial Statements inplace and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe Standalone Financial Statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

• Evaluate the overall presentation structure and content of the StandaloneFinancial Statements including the disclosures and whether the Standalone FinancialStatements represent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the Standalone Financial Statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the Standalone Financial Statements may be influenced. Weconsider quantitative materiality and qualitative factors in (i) planning the scope of ouraudit work and in evaluating the results of our work; and (ii) to evaluate the effect ofany identified misstatements in the Standalone Financial Statements.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the Standalone Financial Statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act and on the basisof such checks of the books and records of the Company as we considered appropriate andaccording to the information and explanations given to us we give in "Annexure1" a statement on the matters specified in paragraphs 3 and 4 of the said Order.

2. We are enclosing our report in terms of Section 143(5) of the Act on the basis ofsuch checks of the books and records of the Company as we considered appropriate andaccording to the information and explanations given to us in the "Annexure 2"on the directions and sub-directions issued by the Comptroller and Auditor General ofIndia.

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 (including Other ComprehensiveIncome) the Statement of Changes in Equity and the Statement of Cash Flow dealt with bythis Report are in agreement with the books of account.

(d) I n our opinion the aforesaid Standalone Financial Statements comply with theIndian Accounting Standards prescribed under Section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended.

(e) Being a Government Company pursuant to the Notification No. GSR 463(E) dated 5 June2015 issued by the Ministry of Corporate Affairs Government of India provisions ofsub-section (2) of Section 164 of the Act are not applicable to the Company.

(f) With respect to the adequacy of the Internal Financial Controls with reference toStandalone Financial Statements of the Company and the operating effectiveness of suchcontrols refer to our separate report in "Annexure 3".

(g) As per Notification No. GSR 463(E) dated 5 June 2015 issued by the Ministry ofCorporate Affairs Government of India Section 197 of the Act is not applicable to theGovernment Companies. Accordingly reporting in accordance with requirement of provisionsof section 197(16) of the Act is not applicable on the Company.

(h) 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 in our opinionand to the best of our 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 Financial Statements. Refer Note No. 69 to the StandaloneFinancial Statements;

II. The Company has made provision as required under the applicable law or Indianaccounting standards for material foreseeable losses if any on long-term contractsincluding derivative contracts;

III. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For T R Chadha & Co LLP For S. N. Dhawan & Co. LLP For Sagar & Associates
Chartered Accountants Chartered Accountants Chartered Accountants
FRN 006711N/N500028 FRN 000050N/N500045 FRN 003510S
(Neena Goel) (S.K. Khattar) (V. Vidyasagar Babu)
Partner Partner Partner
M. No. 057986 M. No.084993 M No. 027357

 

For Kalani & Co. For P.A. & Associates For S.K. Kapoor & For B M Chatrath & Co LLP
Chartered Accountants Chartered Accountants Co. Chartered Accountants Chartered Accountants
FRN 000722C FRN 313085E FRN 000745C FRN 301011E/E300025
(Vikas Gupta) (S. S. Poddar) (V. B. Singh) (Sanjay Sarkar)
Partner Partner Partner Partner
M. No. 077076

M.No.051113

M.No. 073124 M. No. 064305
Place: New Delhi
Date: 25 May 2019

ANNEXURE 1 TO THE INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements'section of our report of even date to the members of NTpC Limited on the standaloneFinancial statements for the year ended 31 March 2019

(i) (a) The Company has generally maintained proper records showing full particularsincluding quantitative details and situation of fixed assets (Property Plant &Equipment).

(b) The Company is having a regular programme of physical verification of all fixedassets (Property Plant & Equipment) over a period of three years which in ouropinion is reasonable having regard to the size of the Company and the nature of itsassets. No material discrepancies were noticed on such verification.

(c) The title deeds of all the immovable properties are held in the name of the Companyexcept as follows:

Description of Asset No. of cases Area in acres Gross block as on 31.03.2019 (' Crore) Net block as on 31.03.2019 (' Crore) Remarks (If Any)
Land

The Company is taking appropriate steps for completion of legal formalities

- Freehold 1183 10124 1478.01 1478.01
- Leasehold 669 10592 1543.62 1362.57
Building & Structures 2 - 4.97 3.04

(ii) The inventory has been physically verified by the management at reasonableintervals. No material discrepancies were noticed on such physical verification.

(iii) The Company has not granted any loans secured or unsecured to any companiesfirms limited liability partnership or other parties covered in the register maintainedunder Section 189 of the Act.

In view of the above clause 3 (iii)(a) 3 (iii)(b) and 3 (iii)(c) of the Order are notapplicable.

(iv) The Company has complied with the provisions of Section 185 and 186 of the Act asapplicable in respect of loans advanced to subsidiary companies & joint venturecompany and investments made in the subsidiary and joint venture companies. The Companyhas not given any guarantee or provided any security to any party covered under Section185 and 186 of the Act.

(v) The Company has not accepted deposits from the public. As such the directivesissued by the Reserve Bank of India the provisions of Sections 73 to 76 or any otherrelevant provisions of the Act and the rules framed there under are not applicable to theCompany. The Company has obtained deposits from the dependents of employees who die orsuffer permanent total disability for which the Company has applied to the Ministry ofCorporate Affairs Government of India for continuation of the exemption earlier obtainedin respect of applicability of Section 58A of the Companies Act 1956 which is stillawaited (refer Note No. 28 (d) of the Standalone Financial Statements). No order has beenpassed with respect to Section 73 to 76 by the Company Law Board or National Company LawTribunal or Reserve Bank of India or any Court or any other Tribunal.

(vi) We have broadly reviewed the accounts and records maintained by the Companypursuant to the Rules made by the Central Government for the maintenance of cost recordsunder sub-section (1) of Section 148 of the Act read with Companies (Cost Records &Audit) Rules 2014 and we are of the opinion that prima facie the prescribed accounts andrecords have been made and maintained. We have not however made detailed examination ofthe records with a view to determine whether they are accurate and complete.

(vii) (a) Undisputed statutory dues including provident fund income tax goods andservice tax service tax duty of customs duty of excise value added tax cess and otherstatutory dues (as applicable) have generally been regularly deposited with theappropriate authorities and there are no undisputed statutory dues outstanding as on 31March 2019 for a period of more than six months from the date they became payable. We havebeen informed that employees' state insurance is not applicable to the Company.

(b) According to information and explanations given to us the gross disputed statutorydues of income tax or sales tax or service tax or duty of customs or duty of excise orvalue added tax amounts to '10696.19 crore in aggregate as on 31 March 2019 out of which' 3055.82 crore has been deposited under protest/adjusted by tax authorities and thebalance of ' 7640.37 crore of dues have not been deposited on account of matters pendingbefore appropriate authorities as detailed below:

Name of statute Nature of the disputed statutory dues Period to which the amount relates (fy) Forum where the dispute is pending Gross disputed amount (rsrore) Amount deposited under protest/ adjusted by tax authorities (rsore) Amount not deposited (rsrore)
1 Income Tax Act 1961 Income Tax/ Penalty/ TDS 1978-79 Supreme Court 0.45 0.45 -
2001-02 2004-05 to 2011-12 Income Tax Appellate Tribunal* 8371.26 1661.87 6709.39
2009-10 to Commissioner 1685.01 1379.35 305.66
2014-15 of Income Tax (Appeals)
2013-14 to Asst. Commissioner 0.32 0.12 0.20
2014-15 of Income Tax
2006-07 2009-10 2017-18 ITO (TDS)/AO 0.81 0.78 0.03
2003-04 Appeal not yet filed by IT department with High Court (Time limit not lapsed) 395.69 - 395.69
2 Income Tax Ordinance of Bangladesh 1984 Income Tax 2012-13 to 2013-14 Commissioner of Taxes (Appeal) Dhaka Bangladesh 2.63 0.26 2.37
3 Central Sales Tax and VAT Acts of various States Central Sales Tax/VAT 1997-98 2000-01 High Court 2.45 - 2.45
1985-86 2000-01 to 2011-12 2013- 14 to 2014-15 Appellate Tribunal/ Board of Revenue 31.40 8.28 23.12
2005-06 to 2008-09 Commissioner of Sales Tax ** 2.37 1.17 1.20
2000-01 2002-03 2004-05 2006-07 2014-15 to 2015-16 Additional Commissioner of Sales Tax *** 5.07 1.58 3.49
1988-89 to 1997-98 2011-12 2015-16 Additional Commissioner of Sales Tax (Appeal) 2.13 0.17 1.96
2008-09 Deputy Commissioner of Sales Tax(Appeals) 0.05 - 0.05
2001-02 to 2006-07 Deputy Commissioner of Sales Tax 11.70 0.01 11.69
2000 -01 2005-06 Joint Commissioner of Sales Tax**** 1.04 0.36 0.68
4 Central Excise Act 1944 Duty of Excise 2009-10 2011-12 to 2014-15 CESTAT***** 1.45 0.10 1.35
2015- 16 to 2016- 17 Commissioner (Appeals) 0.24 0.04 0.20
5 Finance Act 1994 Service Tax 2009-10 to 2012-13 High Court 0.18 - 0.18
2009-10 to 2016-17 CESTAT 172.52 0.35 172.17
2009-10 to 2016-17 Commissioner (Appeals) 3.35 0.64 2.71
2015- 16 to 2016- 17 Assistant Commissioner (Appeals) 0.33 0.02 0.31
2012-13 to 2016-17 Assistant Commissioner of CEST 0.57 0.25 0.32
2012-13 to 2016-17 Appeal yet to be filed (Time limit not lapsed) 0.01 - 0.01
6 Customs Act 1962 Duty of Customs 1999-2000 2006-07 to 2010-11 CESTAT 4.87 - 4.87
2005-06 to 2015-16 Commissioner of Customs (Appeals) 0.29 0.02 0.27
Total 10696.19 3055.82 7640.37

* Includes disputed amount of Rs 5427.00 crore in respect of certain matters wherethe first appellate authority has decided in favour of the company although the AssessingOfficer has disputed the same with appropriate Appellate Authority.

** Includes Rs 2.08 crore and Rs 0.29 crore towards the demand for VAT raised by Salestax officer which has been stayed by the Hon'ble High Court and Commissioner of Sales taxrespectively.

*** Includes Rs 5.01 crore towards the demand for VAT and CST raised by Sales taxauthority which has been stayed by Commissioner/Additional Commissioner of Sales Tax.

**** Includes Rs 1.02 crore towards the demand for CST raised by Sales tax officerwhich has been stayed by the Hon'ble High Court.

***** includes Rs 0.30 crore towards the demand for service tax raised by CommissionerCentral Excise Customs and Service Tax which has been stayed by CESTAT.

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of loans or borrowings to financialinstitutions banks or dues to debenture holders. The company has not taken any loan fromthe Government.

(ix) The Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments). According to the information and explanationsgiven to us the money raised by the Company by way of term loans have been applied forthe purposes for which they were obtained.

(x) According to the information and explanations given to us and as represented by theManagement and based on our examination of the books and records of the Company and inaccordance with generally accepted auditing practices in India

no case of frauds by the Company or any fraud on the Company by its officers oremployees has been noticed or reported during the year.

xi) As per Notification No. GSR 463(E) dated 5 June 2015 issued by the Ministry ofCorporate Affairs Government of India Section 197 of the Act is not applicable to theGovernment Companies. Accordingly provisions of clause 3 (xi) of the Order are notapplicable to the Company.

(xii) The provisions of clause 3 (xii) of the Order for Nidhi Company are notapplicable to the Company.

(xiii) The Company has complied with the provisions of Section 177 and 188 of the Actw.r.t. transactions with the related parties wherever applicable. Details of thetransactions with the related parties have been disclosed in the Standalone FinancialStatements as required by the applicable Indian Accounting Standards.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review.Accordingly provisions of clause 3 (xiv) of the Order are not applicable to the Company.

(xv) The Company has not entered into any non-cash transactions with the directors orpersons connected with them as covered under Section 192 of the Act.

(xvi) According to information and explanation given to us the Company is not requiredto be registered under section 45-IA of Reserve Bank of India Act 1934. Accordinglyprovision of clause 3(xvi) of the Order is not applicable to the Company.

For T R Chadha & Co LLP For S. N. Dhawan & Co. LLP For Sagar & Associates
Chartered Accountants Chartered Accountants Chartered Accountants
FRN 006711N/N500028 FRN 000050N/N500045 FRN 003510S
(Neena Goel) (S.K. Khattar) (V. Vidyasagar Babu)
Partner Partner Partner
M. No. 057986 M. No.084993 M No. 027357

 

For Kalani & Co. Chartered Accountants For P.A. & Associates Chartered Accountants For S.K. Kapoor & Co. Chartered Accountants For B M Chatrath & Co LLP Chartered Accountants
FRN 000722C FRN 313085E FRN 000745C FRN 301011E/E300025
(Vikas Gupta) (S. S. Poddar) (V. B. Singh) (Sanjay Sarkar)
Partner Partner Partner Partner
M. No. 077076 M.No.051113 M.No. 073124 M. No. 064305

ANNEXURE 2 TO THE INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 2 under 'Report on Other Legal and Regulatory Requirements'section of our report of even date to the members of NTpC Limited on the standaloneFinancial statements for the year ended 31 March 2019

Directions u/s 143(5) of the Companies Act 2013 Auditor's reply on action taken on the directions Impact on financial statement
1 Whether the Company has system in place to process all the accounting transactions through IT system? If yes the implications of processing of accounting transactions outside IT system on the integrity of the accounts along with the financial implications if any may be stated. As per the information and explanations given to us the Company has a system in place to process all the accounting transactions through IT system. SAP-ERP has been implemented for all the processes like Financial Accounting (FI) Controlling (CO) Sales and Distribution (SD) Payroll / Human Capital Management (HCM) Material Management (MM) Commercial billing / Industry Solution Utilities (ISU) etc. Nil
Based on the audit procedures carried out and as per the information and explanations given to us no accounting transactions have been processed/ carried outside the IT system. Accordingly there are no implications on the integrity of the accounts.
2 Whether there is any restructuring of an existing loan or cases of waiver/write off of debts/loans/interest etc. made by a lender to the company due to the company's inability to repay the loan? If yes the financial impact may be stated. Based on the audit procedures carried out and as per the information and explanations given to us there was no restructuring of existing loans or cases of waiver/write off of debts/ loans/interest etc. made by the lender to the company due to the company's inability to repay the loan. Nil
3 Whether funds received/receivable for specific schemes from Central/State agencies were properly accounted for/utilized as per its term and conditions? List the cases of deviation. Based on the audit procedures carried out and as per the information and explanations given to us the funds received/receivable for specific schemes from Central/State agencies were properly accounted for/utilized as per the respective terms and conditions. Nil

 

For T R Chadha & Co LLP For S. N. Dhawan & Co. LLP For Sagar & Associates
Chartered Accountants Chartered Accountants Chartered Accountants
FRN 006711N/N500028 FRN 000050N/N500045 FRN 003510S
(Neena Goel) (S.K. Khattar) (V. Vidyasagar Babu)
Partner Partner Partner
M. No. 057986 M. No.084993 M No. 027357

 

For Kalani & Co. For P.A. & Associates For S.K. Kapoor & Co. For B M Chatrath & Co LLP
Chartered Accountants Chartered Accountants Chartered Accountants Chartered Accountants
FRN 000722C FRN 313085E FRN 000745C FRN 301011E/E300025
(Vikas Gupta) (S. S. Poddar) (V. B. Singh) (Sanjay Sarkar)
Partner Partner Partner Partner
M. No. 077076 M.No.051113 M.No. 073124 M. No.064305
Place: New Delhi
Date: 25 May 2019

ANNEXURE 3 TO THE INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 3 (f) under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date to the members of NTpC Limited on thestandalone Financial statements for the year ended 31 March 2019

Report on the Internal financial Controls with reference to standalone financialstatements under Clause (i) of sub-section 3 of section 143 of the Act

We have audited the internal financial controls with reference to Standalone FinancialStatements of NTPC Limited ("the Company") as of 31 March 2019 in conjunctionwith our audit of the Standalone Financial Statements of the Company for the year ended onthat date.

Management's Responsibility for Internal financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls with reference to Standalone Financial Statements based on the internalcontrols over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls over Financial Reporting issued by The Institute of CharteredAccountants of India (ICAI). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence toCompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to Standalone Financial Statements based on our audit. Weconducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls over Financial Reporting (the "Guidance Note") and the Standards onAuditing issued by ICAI and deemed to be prescribed under section 143(10) of the Act tothe extent applicable to an audit of internal financial controls both applicable to anaudit of Internal Financial Controls and both issued by ICAI. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlswith reference to Standalone Financial Statements was established and maintained and ifsuch controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial control system with reference to Standalone Financial Statementsand their operating effectiveness. Our audit of internal financial control with referenceto Standalone Financial Statements included obtaining an understanding of internalfinancial control with reference to Standalone Financial Statements assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement of the Standalone Financial Statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemwith reference to Standalone Financial Statements.

Meaning of Internal financial Controls with reference to standalone financialstatements

A Company's internal financial control with reference to Standalone FinancialStatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of Standalone Financial Statements for externalpurposes in accordance with generally accepted accounting principles. A Company's internalfinancial control with reference to Standalone Financial Statements includes thosepolicies and procedures that (1) pertain to the maintenance of records that in reasonabledetail accurately and fairly reflect the transactions and dispositions of the assets ofthe Company; (2) provide reasonable assurance that transactions are recorded as necessaryto permit preparation of Standalone Financial Statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the Company arebeing made only in accordance with authorisations of management and directors of theCompany; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the Company's assets that could have amaterial effect on the Standalone Financial Statements.

Inherent Limitations of internal Financial Controls with reference to StandaloneFinancial Statements

Because of the inherent limitations of internal financial controls with reference toStandalone Financial Statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to Standalone Financial Statements to future periods are subjectto the risk that the internal financial controls with reference to Standalone FinancialStatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem with reference to Standalone Financial Statements in place and such internalfinancial controls with respect to Standalone Financial Statements were operatingeffectively as at 31 March 2019 based on the internal controls over financial reportingcriteria established by the Company considering the components of internal controls statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the ICAI.

For T R Chadha & Co LLP For S. N. Dhawan & Co. LLP For Sagar & Associates
Chartered Accountants Chartered Accountants Chartered Accountants
FRN 006711N/N500028 FRN 000050N/N500045 FRN 003510S
(Neena Goel) (S.K. Khattar) (V. Vidyasagar Babu)
Partner Partner Partner
M. No. 057986 M. No.084993 M No. 027357

 

For Kalani & Co. For P.A. & Associates For S.K. Kapoor & Co. For B M Chatrath & Co LLP
Chartered Accountants Chartered Accountants Chartered Accountants Chartered Accountants
FRN 000722C FRN 313085E FRN 000745C FRN 301011E/E300025
(Vikas Gupta) (S. S. Poddar) (V. B. Singh) (Sanjay Sarkar)
Partner Partner Partner Partner
M. No.077076 M.No.051113 M.No. 073124 M. No.064305
Place: New Delhi
Date: 25 May 2019