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Northern Power Distribution Company Of Telangana Limited, Warangal, Telangana
October, 31st 2019
    NORTHERN POWER DISTRIBUTION COMPANY OF TELANGANA LIMITED
      Corporate Office, Vidyuth Bhavan, Hanamkonda, Warangal ­ 506001

 REQUIRES SERVICES OF EXPERIENCED CHARTERED ACCOUNTANT FIRMS TO
                 CARRY OUT INTERNAL AUDIT FUNCTION

    TSNPDCL desires to engage experienced Chartered Accountant firms for
assigning   the    Internal    Audit     Functions   in   16   Operation       Circles,   i.e.,
Warangal-Urban, Warangal-Rural, Jangaon, Mahabubabad,               Prof. Jayashankar -
Bhupalpally, Karimnagar, Peddapally, Jagityal, Khammam, Badradri-Kothagudem,
Nizamabad, Kamareddy, Adilabad, Nirmal, Mancherial, Komurambheem-Asifabad
and in Corporate Office of TSNPDCL, Warangal. The Internal Audit work shall have
to be carried out w.e.f.01.01.2020 or as per the programme given by TSNPDCL.

                                Audit Units (As on Date)

     Sl.                                    No. of Expenditure     No. of revenue
                  Name of the circle                                                      Total
     No.                                           units                units
      1     Warangal Urban                            5                        7           12

      2     Warangal Rural                            3                        5           08

      3     Jangaon                                   3                        5           08

      4     Mahabubabad                               3                        4

      5     Prof. Jayashankar                         3                        4           07
            Bhupalpally

      6     Karimangar                                5                    8               13

      7     Peddapally                                3                    7               10

      8     Jagityal                                  3                    6               09

      9     Khammam                                   5                    10              15

     10     Badradri -Kothagudem                      3                    7               10

     11     Nizamabad                                 5                    11              16

     12     Kamareddy                                 4                    7               11

     13     Adilabad                                  3                    4               07

     14     Nirmal                                    3                    4               07

     15     Mancherial                                3                    5               08

            Komurambheem-
     16                                               3                    3               06
            Asifabad

     17     Corporate Office                          1                    -               01

                                 Total               58                    97             155



                                                                                   Contd...2/p.
                                           :: 2 ::

              Apart from the above, Non-Accounting units such as MRT, DPE,
              Construction, APTS, P&MM, Projects, Operation, Civil etc., have also to
              be audited while auditing the respective Circle    Offices and corporate
              office.
              The number of circles may vary in future due to the bifurcation of
              the Districts in Telangana State.
1)    Qualification Criteria: - The Chartered Accountant firms should have       the
personnel qualified in CISA/DISA and the Internal Audit      function is to be carried
out in ERP platform/SAP.

2)    Experience: - The         Chartered Accountant firm     should have minimum
      experience of 3 years in Internal Audit/Statutory Audit of Public
      Sector Undertakings preferably in Power Sector.

3)    An indicative Scope of Audit is stated in Annexure - A for reference.

4) Terms & Conditions:

      1)      TSNPDCL reserves the right to accept the application or reject even if the
              firm fulfils all conditions. The firm shall not assign or transfer the
              work to other firms etc.

      2)      Initially, the tenure of the contractual assignment shall be for a
              period of 2 years i.e., from 1st January 2020 to 31st December 2021.
              The       same is extendable    based on    proven performance of        the
              Chartered Accountant firm. The Firm shall c arry out the Internal Audit
              Work at the EROs/Division Offices/Circle Offices falling under the
              purview of the respective Operation Circles and Corporate Office on a
              fulltime basis and on all working days and should cover all Accounting
              Units at least twice in a Financial Year.

      3)      The Audit Report should be submitted before 5th of succeeding      month
              after completion of Audit.

      4)      An amount of Rs. 35,000/- (Rupees: Thirty five thousands only) shall
              be payable towards remuneration per month exclusive of GST.

      5)      Traveling Expenses & Incidental charges will be paid extra as per NPDCL
              rules for official journeys performed from the Circle Head Quarters
              Office.

      6)      Visiting Audit Teams will consist of minimum one Chartered Accountant
              and two Audit Assistants with CA (Inter) or ICMA (Inter).

      7)      No advance towards Audit Fees or of          any kind    shall be paid/
              sanctioned at any stage of the Audit.

      8)      In case of any dispute the jurisdiction will be Warangal.

                                                                          Contd....3/p.
                                               :: 3 ::








         Interested Chartered Accountant firms shall submit their applications along

with details of qualification & experience of the assistants in the following proforma

to the following address on or before 25/11/2019.

    Details of Chartered Accountant:

                              Qualification
Sl.No.     Membership No.                       Date of joining with the firm
                               (ACA/FCA)




     Details of staff members who would be assisting:

  Sl.No.              Name               Qualification          Experience




     To:

     The General Manager (Audit)

     TSNPDCL, Corporate Office,

     3rd Floor, Vidyuth Bhavan, Nakkalagutta,

     Hanamkonda, Warangal- 506 001, (Telangana).

     Cell No. +91-9440811228.
                                             Annexure-"A"

                                           SCOPE OF AUDIT

01. GENERAL PARAMETERS:

  a) The audit scope is to cover the audit of all aspects of the assigned areas. However, it is not
     intended to be restrictive in coverage.

  b) Generally 100% coverage of all transactions is expected. However where due to large volumes
     100% coverage is not possible; relevant sampling techniques should be adopted and report
     accordingly. The Internal audit is advised to generate the reports from the SAP and verify with
     supported evidences.

  c) Verification of cash book vouchers with SAP cash book.

  d) Verify documentary evidence both internal and external for transactions taken place.

  e) Verify there is a proper authority for all expenditure and transactions.

  f)   Critically review every aspect relevant to the internal audit area, with a view to achieving cost
       savings and improved revenue earnings.

  g) Verify the arithmetical accuracy of the data fed in to SAP system and confirm that the data
     entered in the SAP are supported by documentary evidence.

  h) Review of the MIS reports submitted to higher authorities.

  i)   Endeavour for prevention and quick detection of frauds.

  j)   Check validity of transactions with reference to provisions of laws and statutes.

  k) Verify the accuracy and authenticity of the financial accounting and statistical records.

  l)   Cost audit overview for compliance with cost audit rules.

  m) Ascertain that the standard accounting practices, internal policies & control procedures are being
     adhered to.

  n) Review the operation of the overall internal control system and bring material departures and
     non-compliance to the notice of the management and report thereon. This review also generally
     aims at locating unnecessary and weak controls and to suggest effective and economical
     controls.

  o) Review the adequacy of documentation, filing system & record keeping.

  p) Report on shortcomings / improvements possible in the systems & record keeping.

  q) Report adequacy of existing Information Technology support system (SAP ECC 6) and suggest
     for improvement wherever required.

  r)   Review the process of SAP system in the TSNPDCL and suggest deficiencies if any observed.

  s) Review the statutory returns submitted to authorities concerned and deficiencies if any observed
     should be reported for.

  t)   Review the units at the time of audit whether they are following                                  the
       instructions/circulars/amendments if any issued by the higher authorities from time to time.


                                                                                                 Contd...2/p.
                                                  :: 2 ::

02. GENERAL ACCOUNTING

i) Journal Vouchers:

   a) Check accounting entries made in the SAP with reference to documentary evidence available.


   b) Verify that all journal vouchers accounted in the SAP are properly documented signed, entered
      and approved by the appropriate authorities.


   c) Report on journal vouchers / accounting entries without supporting documentation.


ii) General Ledger Scrutiny:

   a) Scrutinize all revenue accounts.


   b) Review all advances made to suppliers / employees and report any amounts not recovered.


   c) Review all debtors / creditors, loans and advances, deposits, other sundry accounts and report
      the deficiencies observed.


   d) Review all the statutory recoveries and remittances accounts and report any deficiencies
      observed.


   e) Review all the clearing accounts and confirm that all entries are cleared at the end of the year.


   f)   Review the Trial balance and report any deficiencies observed.


   g) Review the Capitalization of Assets and other Capital works Ledger accounts and confirm all the
      systems and procedures adhered too.

03. PURCHASES:

   a. While inspecting the circle office, care should be taken for coverage the levy of statutory taxes
      and duties and its prompt reporting of information to the corporate office.
   b. Review the adequacy of floating inquiries and see that there are in line with the company policy.
   c. Review all enquiries and quotations and report if any deficiencies observed.
   d. Comparative price analysis review on the basis of quotations / other price information.
   e. Review of vendors rating procedures taking in to account price, quality (with reference to field
      reports), reliability of supply & suppliers delivery commitment & priority nature of items.
   f. Reviewing that the purchase orders are prepared and finalized in line with the indents /
      deployment plan and stock levels for all categories of inventory.
   g. Scrutiny the purchase order and compliance with authorization procedure.
   h. Review of post fact purchase orders.
   i. Analyze the reasons for amendments to purchase orders and compliance with authorization
      procedure.
   j. Review of pending purchase orders with respect to subsequent /earlier orders for the same
      material on same party.
   k. Receipt of material as per scheduled dates of delivery and penalties on parties defaulting.
   l. Analysis of material rejection v/s orders placed.
   m. Report on any cases of purchases made by the other department, which should be normally
      handled directly by purchase department.
   n. Review on open purchase orders and comment on follow up. In case of open purchase orders /
      default by parties, report on the emergency purchases made.
   o. Analysis of abnormal time lag for conversion of indents to purchase orders and reports on
      reasons for the same.
   p. Review the procurement data fed in the SAP with reference to documentary evidences i.e.
      agreements, purchase orders and report deficiencies if any observed.
   q. T&P register is to be verified and find out if nay deviation and suggestions and rectifications.
   r. Stationery register is to be verified and report any deficiencies observed.
   s. Review the applicable tax provisions relating to purchases and report if any deficiencies
      observed.









                                                                                              Contd...3/p.
                                                      :: 3 ::

04. INTERNAL CONTROL IN REVENUE UNITS:

   REVENUE:       TSNPDCL h a s a d o p t e d   "Energy Billing System"      Software    for LT
   Revenue and "HT Billing Package" Software for HTRevenue. The Internal Auditor is expected
   t o be well-versed w i t h these Software P a c k a g e s . While conducting Internal Audit of
   Revenue Uni t s, the Internal Auditor has to inadvertently  report on the internal controls of
   these Software Packages.

   a. To reconcile all C C Charges dues as per EBS and as per Records maintained
           at ERO(Cash Book, JE Reregister etc.)
   b. To reconcile all CC Charges' dues as per EBSand SAP
   c. To make summary of final dues (age-wise and                       consumer-wise)
           with specific remarks to assess their quality & recovery potential.
   d. To suggest provisions towards doubtful debts with analysis/ reasons
   e. Billing and receivables management
                   Review adequacy and completeness of billing

                      Review metering a b n o r m a l i t i e s

                      Review Billing inaccuracies

                      Review collection of receivables

    f.       To study and review existing collection              process including Branch Banks

              Networks suggest ways for working capital improvements.

    g.        To Study status of bills stopped services and suggest ways & means for

              increasing demand, collection.



05. Review of work orders:

   a) Verification of actual quantities with estimates.
   b) Verification under / over drawls with reference to labour bills and pole schedules
   c) Verification of devouluted materials as per estimates.
   d) Verification of amount collected and arrears, if any with reference to estimates.
   e) Verification of proper overhead calculations as per company policy.
   f)    Verification of IDC calculations as per company policy.
   g) Verification of proper asset / equipments creation for the work executed.
   h) Verification of proper capitalization date as per the charging declaration of the executing officer.
   i)    Verification of turnkey service connection works for the submission of invoices and posting of
         entries in books of accounts and proper creation of assets / equipment for such work before
         release of supply.
   j)    Verification of completeness of work completion reports / initial accounts with all required
         enclosures and declaration for processing.
06. OTHER AREAS:

   a) To study existing overall internal control systems procedures and suggest improvements.
   b) To study systems, procedures and control measures in all the functional areas such as
      Purchases, Stores, Inventory management, Power sales billing pattern and effective checking
      mechanism.
   c) To study and review existing budgetary control of all expenditures and suggest improvements.
   d) Review of monthly budgets and forecasts.
   e) Monitoring of actual against budgets.
   f) To carry out physical verification of stocks, age wise analysis, review of slow / non moving stock
      items with suggestion for early disposal.
   g) Reporting of budget overruns.
   h) To critically evaluate all R&M (Transformers) repairs works with cost / benefit analysis along with
      suggestive corrective measures, if any.
   i) To evaluate all on going capital expenditures as regards viability / Internal returns etc., including
      exiting project management procedures / functions thereof.
   j) To review all work orders places, their accountable and closure.
                                                                                              Contd...4/p.
                                               :: 4 ::

k) To study existing procedural guidelines for processing bills of suppliers contractors and suggest
   for improvements.

l) To check LOC / LOA preparation processes and suggest for better internal control measures.
m) To study and review status regarding compliances of CAG audit inspection notes and Audit
   paras.
n) To study and review internal control measures for staff "TA bills, medical reimbursements and
   other benefits.
o) To study and review existing manpower (including contractual appointments) deployed in all
   areas & make suggestive comments for redeployment, optimum load etc., towards better
   productivity.
p) To study and review the reconciliation of Corporate office accounts with TSTRANSCO /
   DISCOMS / CIRCLES.
q) Any other matter which is relevant for the operations of the company.

07. GENERAL:

a) The Chartered Accountants while auditing at the particular unit office, should check up the cash
   book, cash book vouchers and remittances. In case of ERO, whether the collections are regularly
   remitted in to Banks or not.

b) Mainly Chartered Accountants have to check the revenue leakages, wherever meter struck up,
   burnt, low consumption and meter change taken place, shortfall should be levied.

c) The Chartered Accountants have to check and ask to furnish pending inspection Reports / Paras
   of AG Audit / Internal Audit shortfall pending to be recovered. The pendency of the above should
   be mentioned in the Inspection Report.
d) The shortfall pointed out by audit, the Internal Auditors should ensure that the Assistant Accounts
   Officers / Junior Accounts Officers, Electricity Revenue Office is accepted to include in the CC
   bills and raise the demand.


e) The last day of the audit, the Divisional Engineer, Operation concerned must be present and
   discuss the short assessment cases pointed out in audit with Chartered Accountants and see that
   the shortfall amounts will be included in CC bills then and there.


f)   The Chartered Accountants have to cover all most all the areas mentioned in the agreement, the
     major lapses if any should be pointed out. The areas coverage should be mentioned in the
     inspection report even though there are no lapses / errors etc., in detail.


g) The Chartered Accountants have to check the annual accounts of the current year at the time of
   inspection and furnish the position in the Inspection report.


h) The audit slips issued to unit officers by Internal Audit and ensure that the replies furnished within
   the reasonable time of one day or two. But the replied not being furnished even at the end of the
   audit. This may be looked into.


i)   Chartered Accountants must also monitor replies of inspection reports where they have already
     audited.


j)   The Internal audit primarily concentrates on the review of existing internal control system and to
     identify the lapses if any in the implementation to suggest ways to implement and improve the
     same in its true spirit in attaining the organizational objective.


k) The Internal Auditors should furnish the shortfall pointed out by them and realization particulars
   thereon along with their Inspection reports.


l)   Rest of the above any other items.

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