REC- 1-51.p65 - Rural Electrification Corporation Ltd.
REC- 1-51.p65 - Rural Electrification Corporation Ltd.
REC- 1-51.p65 - Rural Electrification Corporation Ltd.
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to Ministry Of Power for onward submission/approval of<br />
RBI, it has sought exemption from compliance with the<br />
regulations governing NBFCs till the period of the 12th Five<br />
Year Plan (FY2017).<br />
Further, on December 13, 2006 and February 21, 2009, our<br />
Board of Directors approved our adoption of prudential<br />
norms. Our prudential norms limit our exposure, separately,<br />
for private and state sector borrowers. For private sector<br />
borrowers, our exposure is restricted to any single borrower<br />
for up to 25% of our <strong>Corporation</strong>’s owned funds and to a<br />
single group of companies for up to 50% of our <strong>Corporation</strong>’s<br />
owned funds. In respect of loans to state sector borrowers,<br />
our maximum credit exposure varies from 100% to 250% of<br />
our <strong>Corporation</strong>’s net worth, depending on entity appraisal<br />
and status of on bundling of the respective state utilities.<br />
7. There has been shortfall in creation of Special Fund by some<br />
of the RE Cooperative Societies amounting to Rs. 301.45 lacs<br />
(Previous year Rs.500.89 lacs) and the societies are pursued<br />
to create the required Special Fund.<br />
8. Balance confirmation has been received from most of the<br />
borrowers.<br />
9. Income Tax as applicable in respect of Interest Accrued on<br />
bonds is deducted at source at the time of actual payment of<br />
interest to the bond holders since such bonds are transferable.<br />
10. The formalities regarding registration of conveyance deeds<br />
etc. in respect of some of the Land & Building acquired by<br />
the <strong>Corporation</strong> amounting to Rs. 3,630.58 lacs (Previous<br />
year Rs. 3,996.51 lacs) are in the process of completion.<br />
11. In terms of Accounting Policy No. 10.2, the balances in<br />
respect of Interest Warrants Accounts (both for institutional<br />
and 54EC & Infra bonds) as on 31.03.2010 held in specified<br />
banks are Rs. 3,431.32 lacs (previous year Rs.5,025.32 lacs).<br />
12. In the opinion of the management, the current assets, loans<br />
and advances appearing in the balance sheet have a value<br />
equivalent to the amount stated therein if realized during<br />
the ordinary course of business and all known liabilities have<br />
been provided.<br />
13. Provision for impairment loss as required under Accounting<br />
Standard-28 on impairment of Assets is not necessary as in<br />
the opinion of management there is no impairment of the<br />
<strong>Corporation</strong>’s Assets in terms of AS-28.<br />
14. The company has no outstanding liability towards Micro,<br />
Small and Medium undertakings.<br />
15. Bond Redemption Reserve (BRR) has been created since in<br />
terms of clarification issued by the Department of Company<br />
Affairs, Govt. of India vide no.6/3/2001-CL.V dated<br />
18.4.2002, BRR is not required to be created in the case of<br />
privately placed debentures issued by NBFC’s registered with<br />
the RBI under section 45-IA of the RBI (Amendment) Act,<br />
1997.<br />
16. During the year, the <strong>Corporation</strong> has reduced cost of<br />
borrowing to the extent of Rs.765.69 lacs (Previous year<br />
Rs.420.16lacs) on account of swap (coupon only) transaction<br />
linked to rupee borrowing.<br />
The <strong>Corporation</strong> had entered into various coupons only swap<br />
transactions and cross currency swap transactions. The Net<br />
Mark to Market position in respect of the above swap<br />
transactions as on 31.03.2010 is of Rs. 16,544.12 lacs<br />
(favourable) (Previous year Rs.24, 271.25 lacs favourable).<br />
CONSOLIDATED<br />
17. Directors’ Remuneration:<br />
Particulars Year ended<br />
(Rs. in lacs)<br />
Year ended<br />
31.03.2010 31.03.2009<br />
Salaries and Allowances 75.53 44.33<br />
Perquisites/reimbursement 10.10 15.18<br />
Retirement Benefits Nil 6.70<br />
Total 85.63 66.21<br />
18.<br />
The Chairman and Managing Director and other whole time<br />
Directors have also been allowed to use Staff car including<br />
for private journey(s) up to a ceiling of 1000 kms per month<br />
on payment of monthly charges of Rs. 780/- per month as<br />
per DPE guidelines.<br />
Loans and Advances include Rs. 4.38 lacs (Previous year<br />
Rs.10.66 lacs) due from Directors of the <strong>Corporation</strong>,<br />
maximum amount outstanding during the year Rs.10.66 lacs<br />
(Previous year Rs.14.17 lacs).<br />
Expenditure in Foreign Currency:<br />
(Rs. In lacs)<br />
Particulars Year ended Year ended<br />
Royalty, Know-how,<br />
31.03.2010 31.03.2009<br />
Professional, consultation fees 70.58 Nil<br />
Interest 28.87 161.66<br />
Finance Charges 411.95 79.03<br />
Others Expenses 61.54 53.22<br />
Total 572.94 293.91<br />
19.<br />
All other information required under para 4( c ) and 4( d ) of<br />
Part II of the Schedule VI of the Companies Act, 1956 are<br />
either Nil or not applicable.<br />
Investment include Rs. 1,208.54 Lacs (previous year Rs.<br />
1,447.04 lacs) representing company’s contribution in the<br />
units of Joint venture ‘Small is Beautiful fund (SIB Fund)<br />
Venture Capital fund’ promoted by KSK Energy Ventures<br />
Limited.<br />
Name of Contribution Country of Proportion of<br />
the Company towards Fund Residence ownership<br />
SIB Fund of Rs. 1,208.54 India 9.74 %<br />
KSK Energy<br />
Ventures <strong>Ltd</strong><br />
Lacs<br />
20.<br />
There is no further commitment for contribution.<br />
Subsidy Under Accelerated Generation & Supply Programme<br />
(AG&SP): -<br />
The <strong>Corporation</strong> is maintaining a Interest Subsidy Fund<br />
Account and is claiming subsidy from Govt. of India at net<br />
present value calculated at indicative rates in accordance<br />
with GOI’s letter vide D.O.No. 32024/17/97-PFC dated<br />
23.09.1997 and O.M.No.32024/23/2001-PFC dated 07.03.03<br />
irrespective of the actual repayment schedule, moratorium<br />
period and duration of repayment. The impact of difference<br />
between the indicative rate and period considered at the<br />
time of drawl and the actual can be ascertained only after<br />
the end of the respective schemes.<br />
97