REC- 1-51.p65 - Rural Electrification Corporation Ltd.

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