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Hutti Gold Mines Company Limited, Raichur, Karnataka
August, 09th 2018
Tender for Appointment of Internal Auditors
            for the F Y 2018-19




          Hutti Gold Mines Co Ltd


                   May
                   2018
       THE HUTTI GOLD MINES COMPANY LIMITED, HUTTI


1. INDRODUCTION

    1.1 The Hutti Gold Mines Company Limited (HGML), a Government of
        Karnataka Undertaking has the unique distinction of being the only primary
        producers of gold in the country. The corporate office of the Company is at
        Bangalore and gold extraction plants at Hutti. HGML has been active in the
        process of exploration, development and exploitation of gold deposits
        occurring in Karnataka.

   1.2 At present the company on an average extracts 2 metric tonnes of gold per
        year. The extraction capacity of gold may be increased to 3 tonnes in the
        next 2 years' time. HGML has huge reserves of gold and may take up
        further expansion in future.

    1.3 Location of the Mines          : Lingsugur Taluk, Raichur Dist, Karnataka State
        Distance                       : 480 KM North of Bengaluru
                                         300 KM Southwest of Hyderabad
                                          80 KM West of Raichur
                                          20 KM Northeast of Lingsugur
        Railway Station                :   Raichur, south Central Railway ­ 80.km
        History of Mining              : a) Ancient Mining ­ 2000+ years old
                                            (Pre-Ashokan era)
                                         b) Modern Mining ­ Main Mine during
                                            Nizam's period (1902 -1918)
                                         c) Modern Mining ­ Rediscovery of parallel
                                             Lodes and Mining from 1947 onwards.
        Present Mine Depth             : 26th Level, 842 Metres

    1.4 The Company has four major Departments which play main roles in
         extraction of primary gold.

        Mining Department
        Exploration Department
        Metallurgical Department
        Engineering Department
1.5   Performance of the Company during last 3 years:-

                                                                  (Rs. in lakhs)
               Particulars           FY 2015-16      FY 2016-17      FY 2017-18
                                                                    (Provisional)
      Production
         a) Ore treated (MT)            548237          569087         568692
         b) Net recovery grade            2.39            2.78            2.88
         c) Gold produced (kgs)        1310.00         1579.72        1639.52
      Income / Turnover               43971.73        47882.46       50265.35
      Profitability                     632.76         3077.09        3960.75

1.6 Disclaimer

      This Tender Document is not an agreement and is not an offer or
      invitation by The Hutti Gold Mines Co Ltd (HGML) to any party other
      than the one that qualifies to submit the Bid. The purpose of this
      Tender Document is to provide information to the potential bidders to
      assist them in responding to this Tender Document. Though this Tender
      Document i s prepared with sufficient care to provide all required
      information to the potential bidders, they may need more information
      than what has been provided in this document.       In such cases, the
      potential bidder is solely responsible to seek the information required
      from HGML. HGM L reserves the right to provide such additional
      information at its sole discretion. In order to respond to the tender, if
      required, and with the prior permission of HGML, each bidder may
      conduct his own study and analysis, as may be necessary.







      HGML makes no representation or warranty and shall incur no liability
      under any law, statute, rules or regulations on any claim the potential
      bidder may make in case of failure to understand the requirement and
      respond to the Tender document.         HGML may, in its absolute
      discretion, b ut without being under any obligation to do so, update,
      amend or supplement the information in this Tender Document.
2.0 SCOPE OF WORK:-

   HGML being the only primary producers of gold in India intends to
   appointment Internal Auditors under section 138 of the Companies Act
   2013, for the F.Y.2018-19. Scope, extent and coverage of audit of Hutti
   (including projects i.e.     Uti & Heerabuddinni), Chitradurga and
   Registered Office Bengaluru is mentioned below,

Underground

         · Review and verification of incentive payments including
           calculations , thresholds etc.,
         · Review and check of awards and incentives
         · Review of production records including operating efficiency of
           ore hoisting
         · Review of ore stock records
         · Verification and reporting of consumption of major inputs, in
           comparison with standards
         · Utilization of major Machinery & equipment

Metallurgy

         · Review and check of Gold Bar Books
         · Review      and     check     of  Monthly     Gold     Production
           Records/dispatch/stock & sales reconciliation with Finance
           records
         · Review and check of smelting Records
         · Check of Cyanide Consumption and Gold Production Registers
         · Consumption of Grinding media balls& Liners with reference to
           standards / norms
         · Review and check of recovery of gold
         · Review of monthly reports regarding the Ore treated, concentrate
           and cyanide gold recovered with reference to all relevant registers
           maintained at the Units
         · Monthly review of operating efficiency of ore processing
         · Review and verification of new Refinery Unit
         · Review and verification of incentive payments including
           calculations , thresholds etc.,
         · Review and check of awards and incentives
         · Review of production records
Engineering

          · Review the cost of the power, generation of electricity, and
            compare with purchase of power from outside agencies.
            Reconciliation with finance records
          · Review of utilization of machinery and to report on idle
            machinery
          · Review of installation and commissioning of machinery
          · Review of contracts entered into with various parties in respect of
            transport of mine ore from several mine heads and to ensure that
            the payments are made in accordance with the contract and that
            the penalty is levied as per the terms agreed into. Reconciliation
            with finance and purchase records
          · Review of utilization of fleet of vehicles, comparison of cost of
            operation vis-a-vis contract transportation
          · Checking of Vehicle Log books and consumption of fuel
          · Operating efficiency of ore Manpower deployment for various
            works / departments
          · Review and verification of incentive payments including
            calculations , thresholds etc.,
          · Review and check of awards and incentives

Purchase / Stores

          · Review the system of purchases, listing of vendors, vendor rating,
            system of preparation of comparative statements
          · Review of purchase files relating to capital equipment and other
            materials
          · Review of slow-moving / non-moving / unserviceable / obsolete /
            surplus stores.
          · Audit of all purchase vouchers
          · Physical verification of stores
          · Review of Inventory control
          · Review of issue of stores
          · Review of timely recovery of advances. Reconciliation with
            finance records
          · Review of contracts entered into with various parties in respect of
            transport of mine ore from several mine heads and to ensure that
            the payments are made in accordance with the contract and that
            the penalty is levied as per the terms agreed into
          · Consumption of major inputs such as steel items, cements
          · Materials issued to other units and reconciliation
Finance

          · Review of monthly operational cost sheets and to report reasons
            for wide variations
          · Review the expenses incurred and apportion/accounting on the
            development of each section of mine
          · Audit of all cash and bank payments
          · Audit of journal vouchers
          · Checking of payments against weekly release of funds from Regd.
            Office
          · Check of postings in general ledger and other related records
          · Audit of all claims receivable, analysis, and age wise details
          · Inter-unit ­ accounts (i.e. RO, CGU, HB, UTI & Projects)
          · Audit of Salary, TA and other benefits to employees
          · Compliance with various Statutory Laws like Sales Tax, Income-
            tax and other laws
          · Review of Income-tax deduction and their remittances
          · Checking of Bank Reconciliation and other Reconciliation
            statements
          · Review of cost records
          · Review of Cash Management
          · Review of Budgetary Control system
          · Review of Insurance
          · Review of Advances paid to suppliers and others
          · Review of Significant Account Policies with respect to
            maintenance of Books of Accounts and advises thereon
          · Review of classification of expenses.
          · Review of compliance of mandatory Accounting Standards &
            Ind.AS.
          · Review of Statutory and C&AG observations pertaining to
            previous year and suitable advise for compliance including
            disclosure , accounting treatment etc.,
          · Review and advise on tax-planning
          · Review and reconciliation of all tax related accounts.
          · Review of purchase entries relating to capital equipment and other
            materials
          · Review and check of payment of Ex-gratia& reconciliation
          · Review of Suppliers, contractors, consultants and hospital ledgers
          · Review the cost of the power, generation of electricity, and
            compare with purchase of power from outside agencies&
            reconciliation
          · Review      and    check      of   Monthly      Gold     Production
            Records/dispatch/stock & reconciliation
          · Imports, CVD, ED, CENVAT, VAT , Input Tax Credit, Entry tax
            provisions pending issues
          · Review of implementation of GST
          · System Audit (EDP Audit) & its effectiveness.
Human Resourses

          ·   Review and check of Welfare Expenses
          ·   Review and check of payment of Ex-gratia& reconciliation.
          ·   Pre-paid advances and recoveries
          ·   Festival advance records
          ·   Time office records
          ·   Grants, Donations paid from HGU
          ·   Employee service cards, annual increments, allowances, DA/IDA,
              Bonus, PLIB
          ·   Leave records, discipliner cases
          ·   Court cases, RTI records
          ·   HGML hospital records, expenses
          ·   Medical referrals
          ·   Procurement of drugs, issues of medicines to employees
          ·   Stock of medicines and procedure of disposal of time-barred
              medicines
          ·   Review of employee institute, officers club, cricket club, Guest-
              house, Canteen, other institutional records and activities. Revenue
              collection and expenditure

Security Department :-

          · Deployment and utilization of man-power
          · Booking and payment of overtime, Sunday incentives, and
            allowances
          · Materials and equipment records
Common for All Departments of HGU

          ·   Review system of booking of labour / idle labour.
          ·   Physical verification of fixed assets.
          ·   Compliance audit of procedures.
          ·   Checking of consumption of stores, spares and other components,
              vis-a-vis standards
          ·   Review of Internal Control and Internal Check procedures and
              comments regarding adequacy and strengthening measures if
              required
          ·   Review of financial follow-up, security and vigilance.
          ·   Review of implementation of suggestions.
          ·   Review of Delegation of Powers , deviations from delegations if
              any.
Chitradurga Wind Farm Unit

           · Review of windmill operations and efficiency
           · Review of wind power sales to BESCOM
           · Review of Sale of COT
           · Review of O & M, other contract / purchase files.
           · Review of attendance / leave records, overtime / Sunday booking
             & other miscellaneous payments to employees and contractors /
             suppliers & professionals.
           · Review of Cash / Bank Books, BRS, Inventory / fixed asset
             register.
           · Review of Statutory Deductions / Remittances
           · Review of General / Sub-Ledger

Heera-Buddinni Gold Project

           · Review of General / Sub-Ledger
           · Review of attendance / leave records, overtime / Sunday booking
             & other miscellaneous payments & allowances to employees.
           · Verification of production records
           · Review & verification of utilization of man power, machineries &
             efficiency.

UTI Gold Project

           · Review of General / Sub-Ledger
           · Review of attendance / leave records, overtime / Sunday booking
             & other miscellaneous payments & allowances to employees.
           · Verification of production records
           · Review & verification of utilization of man power, machineries &
             efficiency.

Projects

           · Review & verification of on-going capital works at HGU, Heera-
             Buddinni, UTI Gold Project & Chitradurga units.
           · Procurement / implementation of capital equipments and works as
             per approved capital budget

Registered Office, Bengaluru

           ·   Review of General / Sub-Ledger
           ·   Review of Sale of Gold / Silver
           ·   Review of CSR (Corporate Social Responsibility)
           ·   Review of attendance / leave records, overtime / Sunday booking
             & other miscellaneous payments to employees and contractors /
             suppliers & professionals.
           · Review of Cash / Bank Books, BRS, Inventory / fixed asset
             register.
           · Review of Statutory Deductions / Remittances
           · Review of Fixed Deposit register.

Deliverables:-

Quarterly Audit reports

3.0 INSTRUCTIONS TO BIDDERS

    The Bidder is required to submit Covering Letter in Form No. 1.
    Following are the guidelines for bidders to submit Technical and
    Financial Bids for this assignment.


    3.1 Bid Formats:

        The bid shall consist of two parts i.e. Technical bid & Financial bid.

        The      Technical   bid   shall    contain   all   the   documents   and
        declaration/information     with respect      to compliance     with pre-
        qualification criteria as per Form No. 2.

    3.2 Technical Bid:

        The technical bid document shall include specific responses
        addressing the requirements described below:
          1. Understanding of Hutti Gold Mine's needs.
          2. The bidder's organization profile
          3. Relevant Experience of the firm.
          4. The curriculum vitae of key team members to be associated with
              this study.

          Note 1: Documentary evidences are to be submitted towards all the
                    experiences claimed and clearly highlighting the relevant
                    part in the document.
      3.3 Financial Bid:

            The Financial quote shall not be part of technical bid. The total
            amount /fees including TA/DA, out of pocket expenses and all taxes
            and duties shall be entered in the e-portal, financial bid approval
            format.

      3.4 Others:
            The company will arrange free of cost for the boarding and lodging at
            its mine sites.



4.0 MANDATORY ELIGIBILITY CRITERIAS

      The following are the essential qualifying criterias' for the firms to
      qualify in Technical Bid.

      1) The firm should have been registered with the Institute of Chartered
         Accountants of India or the Institute of Cost Accountants of India.
      2) The firm should have at least 3 Chartered / Cost Accountants as its
         partners
      3) One of the partners should be a fellow member of the Institute
         of Chartered Accountants of India or the Institute of Cost
         Accountants of India.
      4) The firm should have carried out Internal Audit work in any state
         PSUs in Karnataka at least for one year during the previous 3
         years.
      5) The firm shall have minimum personnel strength of 5 assistants /
         article assistants






       Note: Documentary evidences are to be submitted towards compliance
       with Mandatory qualification criterias along with the technical bid.

5.0   EVALUATION CRITERIAS

      5.1      Stage 1: Technical Evaluation
               Stage 1 evaluation will be taken up for those bidders who have
               submitted b i d t h r o u g h e - p o r t a l . The bid will be scrutinized
               with respect to the mandatory eligibility requirements. Only
               those bids who meet all the eligibility requirements shall be
               considered      for further evaluation.         The details of these
              parameters are given in Form No-2 (Technical Bid). Financial
              bid shall be opened for only those bidders, who qualify
              technically as per the Technical Bid.

       5.2    Stage 2: Financial Evaluation

              Bidders who qualify in stage 1, their financial bids shall be
              opened. The lowest bid amount as per e-portal, among the
              technically   qualified   bidders   shall   be   taken   for   further
              consideration,

              The amount to be entered in the e-portal financial bid shall be
              inclusive of all charges, fees, expenses, TA/ DA & out of pocket
              expenses and applicable taxes. The amount entered in the e-portal
              shall be final and binding.

              The assignment/audit work shall be awarded after evaluation of
              the financial Bid.


6.0    OTHER TERMS AND CONDITIONS
       6.1    HGML's right to accept/ reject the bids

              Notwithstanding anything stated in the Tender Document or in
              any related correspondence, HGML reserves the right to accept
              or reject any Bid. It also reserves the right to cancel/annul the
              bidding process and reject all Bids at any time before the award of
              the Contract, without assigning any reason and thereby without
              incurring any liability to the affected bidder or bidders or any
              obligation to inform the affected bidder or bidders of the grounds
              for HGML's action/decision.


7.0   FAILURE TO ABIDE BY THE CONTRACT

      The bidder is expected to strictly adhere to the terms specified in this
      Tender document as well as the LOI. Any violation of any of the terms
      could lead to immediate termination of the Contract at the risk and cost of
    such bidder without prejudice to the rights of HGML with such penalties as
    specified in the Tender Document and the LOI.

8.0 TERMS OF PAYMENT

    HGML will release payments for execution of the Assignment based
    on milestones of work completion as indicated in APPENDIX - 1.


9.0 CONFLICT OF INTEREST

    Neither the selected firm nor any of the firm's personnel shall engage
    in any personal business or professional activity which conflicts or could
    conflict with any of their obligations in relation to this project. The key
    members mentioned in the Tender document shall not be changed in any
    circumstances w i t h o u t t h e p r i o r a p p r o v a l o f t h e H G M L . F ailure
    to comply, the HGML will have the right to cancel the Contract at the risk
    and cost of such bidder without prejudice to the rights of HGML.


10.0 PRICE VALIDITY

    The price quoted by the bidder should be valid for 90 days from the tender
    due date.
            Form 1: Cover Letter



To                                                                         Date:

The Deputy General Manager (Materials),
Hutti Gold Mines Co Ltd.,
Hutti-584115



Sub: Tender for Assignment of Internal Audit of HGML for the F.Y.2018-19

Dear Sir,

1.    We, the undersigned, after having examined the terms and conditions mentioned
in the tender document, submit our technical & financial proposals for the above
tender.

2.    We have read the provisions contained in the tender document and confirm that
these are acceptable to us.

3.    We further declare that additional conditions, variations, deviations, if any, found
in our proposal shall not be given effect to this tender.

4.   We hereby declare that all the information and statements made in this
proposal are true and accept that any misinterpretation contained in it may lead to
our disqualification and without prejudice to other remedies available to HGML



Authorized Signatory (in full and initials):
Name and title of signatory:
Duly authorized to sign this Proposal for and on behalf of [Name of Consultants]
Name of Firm:
Address:
                                                                                  Form - 2
TECHNICAL BID


 Sl.            Mandatory Criterias                Yes/No         Required
 No.                                              (To be         Documentary
                                               filled by the       Evidence
                                                   Firm)


  1    The firm should have been                               Certified copy of the
       registered with the Institute      of                   Registration / certificate
       Chartered     Accountants of India or                   of incorporation
       the Institute of Cost Accountants of
       India.
  2    The firm should have at least 3                         Certificate               of
       Chartered / Cost Accountants as its                     Registration.
       partners

  3    One of the partners should be a                         Certificate     issued   in
       fellow member of the Institute of                       this regard
       Chartered Accountants of India or
       the Institute of Cost Accountants of
       India.
  4    The firm should have carried out                        Names of the companies
       Internal Audit work in any state                        with copies of work
       PSUs in Karnataka at least for one                      orders.
       year during the previous 3 years.
  5    The firm shall have minimum                             Curriculum       Vitae    in
       personnel strength of 5 assistants /                    brief.
       article assistants
(A) - The technical bid document should include specific responses addressing the
      requirements described below:-



         1.     Understanding of Hutti Gold Mine's needs.
         2.     The bidder's organization profile
         3.     Relevant Experience of the firm.
         4.     The curriculum vitae of key team members to be associated with this assignment.

         Note 1: Documentary evidences are to be submitted towards all the experiences
                     claimed and clearly highlighting the relevant part in the document.


(B) - Credentials related to the works / assignments completed/continuing for last
      3 (Three)years.

   Sl.        Name of the          Contacting    Scope of Year      of Value of     Period of
   No.        Client/              person of     Services  services    Assignment   Completion
              Organization with    Client        Provided  provided    (INR)        of
              Address              with          by Bidder                          Assignment
                                   telephone
                                   Number




(C)- Qualifications and Experience of Key Personnel to be associated with the Assignment:

                     Particulars                    Professional No.1    Professional No.2

   Name and Designation

   Experience / Work History

   Educational / Professional Qualification(s)

   Expected Nature of Involvement (Specific
   roles / activities Full time/ part time
                                                                                       Appendix - I


Terms of Payments

The following schedule will be adopted for the payment of fees:



                                                                         Schedule of
                           Milestones
                                                                          Payment
  1) Submission of first 2 quarterly Internal Audit report.                  50%

  2) Submission of balance 2 quarterly Internal Audit                        50%
     Report and clearance from Audit Committee of
     HGML



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