financial concurrence-ntpc

A
PROJECT REPORT
ON
FINANCIAL CONCURRENCE
(As partial fulfillment for the award of M.B.A. degree under U.P.
Technical University Lucknow 2005-07)
Work carried at
National Thermal Power Corporation Limited
Rihand Super Thermal Power Project
Under The Guidance of: Submitted By:
Ms. Gurbandini KAMLESH GAUTAM
Roll No.-0509870181
INSTITUTE OF MANAGEMENT STUDIES,
NOIDA

Certificate
To whom it may concern
This is to certify that Mr. Kamlesh Gautam Roll.No.0509870181 of MBA
is a bonafide regular student of Institute of Management Studies (IMS), Noida
for the session 2005-07.
He has completed the summer training project report entitled “Financial
Concurrence” In the Organization National Capital Power Station (N.T.P.C),
Rihand Nagar.
As a part fulfillment for the award of MBA degree under U.P.Technical
University, Lucknow.
I find the research report is up to standard and original one.
Dr.C.S.Nagapal
Executive Director.

Certificate
To whom it may concern
This is to certify that Mr. Kamlesh Gautam Roll.No.0509870181 of MBA
is a bonafide regular student of Institute of Management Studies (IMS), Noida
for the session 2005-07.
He has completed the summer training project report entitled “Financial
Concurrence” In the Organization National Capital Power Station (N.T.P.C),
Rihand Nagar.
As a part fulfillment for the award of MBA degree under U.P. Technical
University, Lucknow.
I find the research report is up to standard and original one.
Project Supervisor
Ms. Gurbandini

PREFACE
In the summer training, the training project provided to me in the area of
“Finance” is “Financial Concurrence” relating to National Thermal Power
Corporation (NTPC) National Thermal Power Corporation, NTPC has been the
power behind India’s sustainable power development since November 1975
contributing 26% of the country’s exiting power generation with 19% of installed
capacity. NTPC today lights up every fourth bulb in the country. NTPC has 16
coal based & 7 gas based power stations spread all over the country with
installed capacity of 22,249 MW with ambitious growth plan to become a
56,000 MW power company by 2017. NTPC the largest power utility of India
has already diversified into hydropower sector.
During my summer training form June 2006 to 31 July 2006. I collected
lot a facts and information related to the inventory in NCPS and try making a
useful project report.
In NTPC mostly inventories item are chemicals and oils, equipment,
machine element & hardware as pipes fittings and flanges, rolling bearings, and
accessories, tools cutting tools welding electronic, stationery, Boiler, Turbo-
generator, Electrical, circuits, components, Computer, Motor and control panel
etc. in NTPC more investment required in capital nature items.

TABLE OF CONTENT
1. Executive summary 1
2. Theoretical concept 5
3. Introduction of the problem 17
4. Scope & importance of study 27
5. Objective of study 29
6. Research Methodologies 31
7. Introduction of industry 35
8. Data presentation 66
9. Data analysis 74
10. Findings of the study 82
11. Recommendations 84
12. Bibliography 89
13. Appendix 92

ACKNOWLEDGEMENT
Although a summer training report is considered to be the result of an
individual effort and the credit goes to the ultimate person conducting the
analysis .But without the invaluable co-operation of some persons, this project
report can not be completed.
I am very much thankful to Mr. B. SAHA(DGM) and Mr. Y.B.
MISHRA(Sr. MANAGER) of finance for preparing my schedule of practical
training at NTPC RIHAND. They helped me to have an insight the functions of
different sections of F& A . Mr. MISHRA patiently provided me his valuable time
and guidance .
I am also very thankful to Mr. R.C. DEBNATH, Mr. KUNDAN MISHRA,
Mr. PUNEET GUPTA, Mr. R.K. SINGH and all other members of F& A
department for their kind support.
My special thanks to Mr . R. M. YADAV( C&M), Mr. K. LAL(C &M ) and
Mr. A.K. SINGH(TQM) for providing necessary information related to l;ead time
of inventories.

I also own my sincere thanks to Mr. B.J.RISHI(CO-ORDINATOR),
Ms.GURBANDINI CHABRA (PROJECT SUPERVISOR) and Mr. A.
HAIDAR(FINANCE) of IMS , NOIDA under the expert guidance of whom this
project report has been completed. I extend my thanks to my uncle Mr.
DINESH RAI(ENGG.) for their moral support and ever encouraging co-
operations .
KAMLESH GAUTAM

EXECUTIVE SUMMARY
MyselfKAMLESH GAUTAM, student of M.B.A. second year (3rd
sem.)
from I.M.S. NOIDA. I joined NTPC, Rihand on 12/06/2006 for my summer
training as a part of the course of M.B.A. Here is a brief introduction about my
training. My training period started from 12/06/2006 and went till 27/07/2006. I
completed this project under Mr. Puneet Gupta and my Project title is
“FINANCIAL CONCURRANCE”. My training project was associated with
Finance & Account Department.
In NTPC, Rihand there are 10 subdivisions under the Finance &
Account Department, there names are:-
1. Establishment Section
2. Stores Bills Section
3. Work Section
4. Commercial Section
5. Miscellaneous Section
6. Pricing Store Ledger(PSL)
7. Financial Concurrence
8. Cash And Bank
9. Budget Section

10.Books And Account Section.
This training project was almost a like a blast during the course
of M.B.A. because during the training session I came to know about lots of
things related to high level management as well as low level management. I
also came to know about the working schedule and techniques and how to
face the problem which encounter during the real practice. Some of them
are mentioned here.
There I noticed how they issue the award letter and how much
time taken by the finance & account and contract & material department. An
award letter is issued after financial concurrence. In any PSU , It has a vast
channel for financial concurrence NTPC RIHAND take average 31 days.
I learnt there were various types of tenders and contract. Here I
came to know about the concurrence procedure of the NTPC RIHAND.
After studying about the tenders and various channels of the procedure, I
realized that this lead time can be reduced and which will result a large
saving in terms of money and man power also.

So in this order I proposed various suggestions to my project
guide Mr. Puneet Gupta. Some of them are as follows:-
1. Proposal to be received by concurring officer directly.
2. Proposal of construction activities to be cleared by FES before sending
to financial
3. Post award proposal for time extension / deviation to be routed though
CS.

THEORETICAL CONCEPTS
THE FINANCIAL IMPACT OF ABT ON RIHAND SUPER THERMAL
POWER PROJECT
After having discussed the various aspects of the Existing tariff
System and The Availability Tariff System, now the Financial Impact of ABT
on the Rihand Super Thermal Power Project is being analyzed. The
analysis has been done by taking data for the last 6 months i.e. from 1st
April to 30th
Sept, 2002. The Methodology used for the financial analysis is
as per following steps:
Firstly, all Physical and Basic Financial data has been collected for
the 6 months from the Finance and Commercial Department.
a) From this data, the Monthly Cost of Sales has been calculated for the
Project for each of the last 6 months.
b) For every month the Tariff Recovery has been calculated both as per K P
Rao Tariff and Availability Based Tariff System.

c) The Profitability for every month has been compared under both the system
with the reasons for the differences between the two.
d) The Total Impact of ABT for the six months has been calculated on the
profitability of Rihand Project.
e) The same has been extrapolated for obtaining an approximate anticipated
annual data.
The Calculations has been done on the following basis:
S. No. Particular K P Rao Tariff ABT
A Fixed Charges Full recovery above
62.49% PLF
Full recovery above
80% Availability
B Variable Charges As per Actual
Generation
As per Scheduled
Generation
C Incentive Above 68.49% PLF
as per prescribed
rates
Above 77% PLF as
per prescribed rates
D UI charges NA Has been calculated
net of UI charges
payable and
receivable.
E Cess etc Actual basis Actual Basis.

TOTAL IMPACT OF ABT ON RIHAND SUPER THERMAL
POWER PROJECT FOR THE 6 MONTHS (FROM 1ST
APRIL TO 30TH
SEPTEMBER)
The total effect of ABT on profitability of RhSTPP is as follows:
SR. NO. MONTH NET PROFIT (RS IN
LAKHS)
UNDER K P RAO
TARIFF
UNDER ABT
SYSTEM
1 April, 1999 1571 1407
2 May, 2000 2141 2013
3 June, 2001 2375 2113
4 July, 2002 2778 2254
5 August,
2003
2712 2230
6 September
, 2004
724 1086
TOTAL 12301 11103
Difference Rs.1198 Lakhs
Difference for the year Rs. 2400 Lakhs (Approx)

There is a less Net profit of Rs.1198 lakhs for 6 months
under the ABT system. The main reasons for this difference are as
under:
a. The Variable charges have been charged on actual
generation basis in Two Part tariff system and on
Scheduled generation in ABT. As there was large
difference in scheduled generation and Actual generation,
the variable charges in Two part tariff were more as
compared to ABT.
b. The Incentive under Two part tariff is more because it
starts from 68.49% PLF whereas it is less in ABT system.
c. Due to Actual generation more then Scheduled generation
(but within the Declared capability), Rihand has earned UI
charges.
Taking a collective effect of all three elements the net effect
results in a less net profit of RS.1198 lakhs The positive UI charges
were not able to compensate the less recovery due to the other two
elements. As Declared Capacity was more then 80%, the fixed charges
have been fully recovered in both the cases.

AREAS WHICH NEED SPECIAL ATTENTION FROM NTPC
POINT OF VIEW
The application of ABT calls for the special attention of NTPC so
that the negative impact of ABT can be minimized and the profitability
can be maximized. The following are certain areas that need special
attention:
Reliable and Fast communication: Communication is the
essence of the ABT system. The Declared capacity can be revised by
station at any time, which shall be applicable in case of Unit tripping,
from 4th
time block and in case of other revisions from 6th
time Block.
Apart from this, Schedules sent by RLDC are applicable irrespective of
the success of communication to station. Whereas, the Capability
revision, if any sent by the generator, is allowed from the time message
reaches RLDC control room. Therefore, the system has to be perfect.
Also the alternatives have to be provided in case of non-functioning of
one mode of communication.

Quality of Coal: The quality of the coal received is to be closely
monitored. This is because operations have to match the schedule given
by RLDC. If the operation group knows in advance the likely GCV of the
coal to be fired, they can plan the generation accurately, thereby
decreasing the chances of negative UI charges and at the same time
saving the coal quantity by optimizing the coal firing.
a. Avoidance of frequent failures: The equipments
have to be kept in very healthy state so as to avoid frequent
failures. The financial impact of even a single failure can result in
negative UI charges running in multi lakhs. As under the ABT
system, the changes in the schedule are applicable from the 4th
time block, the UI charges will be charged for at least 3 time
blocks. Thus, the equipment healthiness is very important.
b. Planning for Maintenance and Overhauling
activities: The perfect planning of the time of maintenance and
overhauling activities is also very important. Unplanned
maintenance & overhauling activities can result in deviations from
the generation schedule. Further, the overhauling should be
planned in such way that, it does not result in Declared capacity
below 80% annually which may result in under recovery of fixed
charges.

c. Monitoring of Online Generation: The other very
major area is the close monitoring of the accurate online
generation. This is very important because the Shift In charge
must be aware about the actual generation and grid frequency at
every moment so as to take corrective measures within the time
block of 15 minutes. Therefore, the online data should be
accurate with minimum deviations.
d. Taking Quick decisions: Another very special area
is of taking fast decisions. In ABT scenario very quick decisions
are required. As the follow up steps have to be taken within the
time block of 15 minutes, so as to prevent the loss, there will be
no time for consultations etc. The Desk engineer has to be well
equipped with the knowledge of ABT norms and financial
implications of each and every decision he is taking.

STEPS TO BE TAKEN AND MORE FACILITIES TO BE
PROVIDED IN THE VARIOUS UNITS OF NTPC
The following steps are required to be taken by NTPC and
certain Facilities are required to be provided in various units.
These are as under:
I. Alarm System for the Rapid Frequency changes
(Especially for the UI zone) is to be provided. It has been observed that
negative UI charges are incurred during the rapid frequency fall. It is
necessary to provide an audio-visual alarm, if the rate of change of
frequency is more then a prescribed value.
II. A software based analysis of the UI charges and the
generation is required. This should tell that UI charges can be avoided
by planning the generation upto what levels. The Software has to be
made and has to be attached with the field data so as to provide the
online analysis of the generation level etc.
III. Special Energy Meters (SEMs) should be provided at
every unit for the purpose of using them for taking accurate data for the
online analysis purposes, which should be identical to those being
used by grid for calculation of UI.

IV. There should be a Big display of Declared Capability,
Scheduled Generation, Actual Generation and Frequency for the
current time block in the Control Room.
V. Extra fax machines (at least Two) exclusively for the
purpose of ABT should be provided in the control room. Further the
SATCOM fax should also be provided, which may be used in case of
P&T lines failure.
VI. A telephone with memory of atleast 20 numbers and
features of fast dialing should be provided. Further it should also have
the facility of voice recorder, so as to avoid the disputes in the future.
VII. The Unit and the RLDC should be connected by way of a
leased line or Hotline, so that no time is wasted in communication.
PLCC- Power Line Carrier Communication should also be provided
where ever possible.
VIII. Internet connection with SATCOM and the alternatives
from BSNL should also be provided. BSNL can be used as standby
channel of communication

INPUTS FROM THE EXPERIENCES OF VINDYACHAL SUPER
THERMAL POWER STATION.
In Vindyachal Super Thermal Power Station that is in the Western
Region, the Availability Based tariff has already been implemented w.e.f. 1st
July 2002. A visit was made to the Vindyachal to have the first hand
experiences about the implications of ABT and also to see what steps has been
taken in respect to the implementation of ABT at that station. The various
inputs from there are as follows:
I. An ABT Control Room has been set up with one dedicated
senior engineer posted in shifts who has to regularly monitor the
actual generation and the scheduled generation and is in constant
touch with the Shift in charge.
II. Daily Morning meeting of all the concerned Head of
departments is held with AGM(O&M) where the progress of earlier day
is discussed and the capacity to be Declared for the next day is
decided.
III. Daily ABT report is generated and it is analysed w.r.t. UI
charges and the extra Fuel spent in the generation.

IV. Every shift in charge and all the concerned heads are
having cordless phones, so that they can remain in touch even if they
are in the locations. This helps in better communication.
V. Assistant Shift In charge has been made responsible for
the upkeep of the Scheduled generation.
VI. In case of Unit tripping or any other breakdown or
shutdown, this information is sent to the WRLDC and the WRHQ at the
same moment. The purpose of sending it to the WRHQ is that the HQ
will also in turn confirm the communication from the WRLDC, which is
also in Mumbai where the WRHQ is located. The mode used is Phone
and Fax.
VII. There are 8 Units in total and it is not possible to adjust the
generation os all the units at the same time as per the schedule.
Therefore, one unit has been instructed to increase and reduce the
load as per the schedule and rest units to generate upto there optimum
capability.

INTRODUCTION OF THE PPROBLEM
FINANCIAL CONCURRANCE
[SOURCE: MANAGER (F&A)]
PURPOSE
To examine the proposal from the financial point of view.
FUNCTIONING:
Financial concurrence is done by keeping in mind the
“cannons of financial proprietary”
The proposals below Rs 5000/ require no financial
concurrence after that financial concurrence is necessary.
According to the delegation of power the signatures of component
authority is necessary for the sanctioning the amount.
Financial powers are exercised in the following ways:
# POWER OF PURCHASE
# POWER FOR WORKS

# POWER RELATING TO THE ESTABLISHMENT
Works comprises civil work, i.e., construction of roads,
building etc. three conditions are required for the approval.
[1] Acceptance of the necessity- for this purpose the
detailed report depicting the necessity has to be prepared by the
concerned department.
[2] Administrative approval of the cost estimate: The
detailed report depicting the cost involved in each and every item
is prepared. The costs are fixed according to [DSR] i.e., Delhi
Schedule of Rate.
[3] Technical approval of the competent authority: The
approval is granted according to the delegation of power.
[4] Availability & appropriation of fund: Availability of fund
is seen as per the budget estimate. In the case of shortage, the
fund is taken out from the unworkable after undergoing these
entire steps contract is awarded.

SCOPE AND PERFORMANCE
CONTRACT DOCUMENT
The contractor shall be furnished, free of charge, two certified true
copies of the contract documents except standard specification and the
schedule of rates and of all further drawings which may be issued during the
progress of the works. he shall keep one copy of these documents on the site
in good order, and the same shall at all reasonable times be available for
inspection and use by the engineer-in –charge, his repetitive or by other
inspecting officers.
SECURITY DEPOSITE: The contractor shall permit the corporation at
the same time of making any payment to him for work done under the contract
to deduct toward the security deposited at the rate of 10% of gross amount of
each on account payment for contracts of value up to Rs 20 lakhs and at the
rate of 5% for contracts of value equal to and greater than Rs 20 lakhs untill the
security deposit so deducted reaches the value of schedule a in cash or in the
form of

Government Security Or Fixed Deposit Receipts Or Bank
Guarantees Furnished By Any Of The Nationalized Bank.
(a) The security deposited reaches a limit of Rs 1 lakhs, the contractor, if
he so desires may convert the amount into one of the government securities or
bank guarantees as aforesaid.
(b) provider that, if at the same time of payment of the final bill , the
deductions so made together with the earnest money already , fall short of the
security deposited the recovery of the balance amount of sd shall be deemed to
have been waived.
DEVIATION /VARIATION EXTENT & PRICING
10 . the engineer – in –charge shall have power
(i) to make alteration in, oomissions from , addition to, substitutions for
the original specification , drawings, designs and instructions that may appear
to him to be necessary or advisable during the progress of the work , and
(ii) to omit a part of the work in case of non-availability of the portion of
the site or for any other reasons, and the contractor shall be bound to carry out
the works in accordance with any instruction given 5o him in writing signed by
the engineer-in charge and such alteration , omission, additions, or subsitution
shall form part of the contract as if originally provided therein and any altered,
additional or substituted work which the contractor may be directed to do in the

manner above specified as part of the work, shall be carried out by the
contractor on the same conditions in all respects including price on which he
agreed to do the main work. any alteration, omissions additions or substitutions
which radically charge the original nature of the contract shall be ordered by the
engineer-in –charge as a deviation and in the event of any deviation being
ordered which in the opinion of the contractor changes the original nature of the
contract, he shall nevertheless carry it out and the disagreement if any, as to
the nature of work and the rate to be paid therefore shall be resolved in
accordance with condition 56.
In the case of the contract items, substituted items, contract-cum-
substituted item or additional items which exceed the contractor may, fourteen
days of receipt of order or occurrence of the excess claim revision of the rates,
supported by proper analysis, for the work in excess of the above – mentioned
limits, provided that if the rates so claimed are in excess of the rates specified
in the schedule of quantities or of those derived in accordance with the
provisions of condition 10 by more than 5%, inform the engineer –in-charge
under advice to the accepting authority and the engineer –in-charge shall,
within 3 months of the receipt of the claim supported by analysis , after giving
consideration to the analysis of the rates and submitted by the contractor,
determined the rates on the basis of market rates and if the rates so
determined exceed the rates specified in the schedule of quantities or those

derived in accordance with the provisions of conditions 10 by more than 5%,
the contractor shall be paid in accordance with the rates so determined by the
engineer-in-charge with 5%of the rates specified in the schedule of quantities
or of those determined in accordance with the provision of condition 10.
TIME AND EXTENSION FOR DELAY:
(13) The time allowed for execution of the work as specified in the
schedule A or the extended time in accordance with these conditions shall be
the essence of the contract. The execution of the works shall commence from
the 15th
day after the date on which the corporation issues written orders to
commence the work. If the contractor commits default in commencing the
execution of the work as aforesaid, corporation shall without prejudice to any
other right or remedy is at liberty to forfeit the earnest money absolutely.
(13.1) as soon as possible after the contract is concluded the engineer-
in-charge and the contractor shall agree upon a time and progress chart. The
chart shall be prepared in direct relation to the time stated in the contract
documents for completion of items of the works. It shall indicate the forecast of
the date of commencement and completion of various trades or section of the
work and may be amended as necessary by agreement between the engineer-
in-charge and the contractor within the limitation of time imposed in the contract
document, and further to ensure good progress during the execution of the

work, the contractor shall in all cases in which the time allowed for any work
exceed one month say for the special jobs complete 1/8th
of the whole of the
work before 1/4th
of the whole time allowed in the contract has elapsed;3/8th
of
the work before one half of such time has elapsed and 3/4th
before 3/4th
of such
time has elapsed.
(13.2) if the work be delayed by
(a) Force majeure, or
(b) Abnormally bade weather, or
(c) Serious loss or damage by fire, or
(d) Civil commotion, local combination of workmen, strike or lockout,
affecting any o the trades employed on the work, or
(e) delay on the part of the other contractors or tradesmen engaged by
corporation in executing work not forming part of the contract, or
(f) Non-availability of stores, which are the responsibility of corporation to
supply, or
(g) Any other cause which, in the absolute discretion of the authority
mentioned in schedule A is beyond the contractor’s control;
Then upon the happening of any such causing delay, the contractor shall
immediately give notice thereof in writing to the engineer-in-charge but shall
nevertheless use do all that may be reasonably required to the satisfaction of
the engineer-in-charge to proceed with the work.

(13.3) request for extension of time , to be eligible for consideration ,
shall be made by the contractor in writing within fourteen days of the happening
of the event causing delay. The contractor may also’ if practicable , indicate in
such a request the period for which extension is desired.
(13.4) in any such case the authority mentioned in schedule A may give
a fair and reasonable extension of time for completion of the work . Such extent
ion shall be communicated if the date of receipt of the date of such request by
the engineer-in-charge.
COMPENSATION FOR DELAY:
If the contractor fails to maintain the required progress in terms of
condition 13 or to complete the work and clear the site o or before the contract
or extended date period of completion , he shall , without prejudice to any other
right or remedy of the corporation on account of such breach, pay as agreed
compensation amount calculated as stipulated below, or such smaller amount
as be fixed by the authority mentioned in schedule ‘A’ on the contract value of
the work for every week that the progress remains below that spacified in
condition 13 or that the work remains incomplete.

This will also apply to items or group of items for which separate period
of completion has been specified (REFER SPECIAL CONDITION OPF
CONTRACT)
For this purpose the term ‘contract value’ shall be the value at contract
rates of the work as ordered.
1. Completion period (as originally stipulated) @ 1 % week
not exceeding 6 months.
2. Completion period (as originally stipulated) @ 1/2 % week
3. Completion period (as originally stipulated) @ 1/4 % week

SCOPE OF STUDY
(1) The scope of the study in terms of time is limited Critical data’s for 99-
2000, 2001-02, 2003-04, 2004-05.
(2) The study covers the thermal power project NTPC Located at
RIHAND SONEBHADRA
(3) No delay in declaration of commercial operation
(4) To control and direct tall hierarchy of finance and account and contract
material department.
(5) Regularizing work and contract order.
(6) We can save many days; by this we can save manpower and money

OBJECTIVE OF THE STUDY
1. To identify best practices for Financial Concurrence & Vetting in
order to reduce process lead-time from 31 days to 16 days,
develop initiative & speed and improve the total quality of the
process to achieve customer delight.
2. To study over all financial policies of NTPC
3. Evaluate financial performance of company
4. To understand the need of financial concurrence.
5. To study the delegation of powers as applicable to the executives
of the company& related process of financial concurrence.
6. To evaluate the measures to reduce the lead time taken in the
process of financial concurrence & vetting.

RESEARCH METHODOLOGY
OBJECTIVE OF RESEARCH
• As certain the decision making objective
• Understand the background o the problem
• Isolate & identified the problems
• Determine the unit of analysis
• Determine the relevant variables
RESEARCH STRATEGY
Research strategy is a general plan of how we will go about answering the research
question . It contain clear objective , derived from our research question specify the
sources from which we intend to collect data , and consider the constraint that we
inevitable have

DIFFFERENT RESEARCH STATEGIES ARE
• Experiment
• Survey
• Case Study
• Grounded theory
• Ethnography
• Action research
• Cross – Section & Longitudinal studies
• Exploratory , descriptive & exploratory studies
For completing my project report , I have used descriptive
study . The object of descriptive & analytical research is “ To
portray an accurate profile of event or situations” . In my project ,
I have emphasized on financial concurrance of the organization.
.

SAMPLING FRAME
The project work is to analyze the financial concurrence of
NTPC, for this the sampling frame is RIHAND STPP, BIJPUR .
Here I have studied in finance & account department.
APPROCHASES TO RESEARCH
The two main approaches to research are deductive & inductive .
These should not be though o as mutually exclusive, we can use
both in combination on the same research project . The main
influence on our choice o research approach should be our
research questions and objectives. For this project report , I have
used deductive approach for these I have analysis data which
was provided by Finance & Account department

INTODUCTION OF THE INDUSTRY
NTPC Limited is the largest thermal
power generating company of India. A
public sector company, it was incorporated
in the year 1975 to accelerate power
development in the country as a wholly
owned company of the Government of India. At present, Government of India
holds 89.5% of the total equity shares of the company and FIIs, Domestic
Banks, Public and others hold the balance 10.5%. For shareholding pattern.
Within a span of 30 years, NTPC has emerged as a truly national power
company, with power generating facilities in all the major regions of the country.
Based on 1998 data, carried out by Datamonitor UK, NTPC is the 6th largest in
terms of thermal power generation and the second most efficient in terms of
capacity utilization amongst the thermal utilities in the world

NTPC's core business is engineering, construction and operation of
power generating plants and also providing consultancy to power utilities in
India and abroad. As on date the installed capacity of NTPC is 24,954 MW
through its 14 coal based (20,685MW), 7 gas based (3,955 MW) and 3 Joint
Venture Projects (314 MW). NTPC acquired 50% equity of the SAIL Power
Supply Corporation Ltd. (SPSCL). This JV Company operates the captive
power plants of Durgapur (120 MW), Rourkela (120 MW) and Bhilai (74 MW).
NTPC’s share on 31 Mar 2006 in the total installed capacity of the country was
19.51% and it contributed 27.68% of the total power generation of the country
during 2005-06.

NTPC has set new benchmarks for the power industry both in the area
of power plant construction and operations. It is providing power at the
cheapest average tariff in the country. With its experience and expertise in the
power sector, NTPC is extending consultancy services to various organizations
in the power business.
NTPC is committed to the environment, generating power at minimal
environmental cost and preserving the ecology in the vicinity of the plants.
NTPC has undertaken massive afforestation in the vicinity of its plants.
Plantations have increased forest area and reduced barren land. The massive
afforestation by NTPC in and around its Ramagundam Power station (2100
MW) have contributed reducing the temperature in the areas by about 3°c.
NTPC has also taken proactive steps for ash utilization. In 1991, it set up Ash
Utilisation Division to manage efficient use of the ash produced at its coal
stations. This quality of ash produced is ideal for use in cement, concrete,
cellular concrete, building material.
A "Center for Power Efficiency and Environment Protection (CENPEEP)"
has been established in NTPC with the assistance of United States Agency for
International Development. (USAID). Cenpeep is an efficiency oriented, eco-
friendly and eco-nurturing initiative - a symbol of NTPC's concern towards

environmental protection and continued commitment to sustainable power
development in India.
As a responsible corporate citizen, NTPC is making constant efforts to
improve the socio-economic status of the people affected by the its projects.
Through its Rehabilitation and Resettlement programmes, the
company endeavors to improve the overall socio-economic status of Project
Affected Persons.
NTPC was among the first Public Sector Enterprises to enter into a
Memorandum of Understanding (MOU) with the Government in 1987-88. NTPC
has been Placed under the 'Excellent category' (the best category) every year
since the MOU system became operative.
Powering India's Growth : Through people
NTPC believes in achieving organizational excellence through Human
Resources and follows "People First" approach to leverage the potential of its
23,500 employees to fulfill its business plans. Human Resources Function has
formulated an integrated HR strategy which rests on four building blocks of HR
viz. Competence building, Commitment building, Culture building and Systems

building. All HR initiatives are undertaken within this broad framework to
actualize the HR Vision of "enabling the employees to be a family of committed
world class professionals making NTPC a learning organization.
To induct talent and groom them into a dedicated cadre of power
professionals "Executive Trainee" Scheme was introduced in the year 1977 for
recruitment in the disciplines of Mechanical, Electrical, Civil, Control &
Instrumentation and now encompasses Computer Science, Chemistry, HR and
Finance disciplines also. Besides a comprehensive one-year training
comprising theoretical inputs as well as on-the-job training, the new recruits are
also attached with senior executives under a systematic and formal 'Mentoring
System' of the company to integrate them into the Culture of the company.
Powering India's Growth : Through people
NTPC believes in achieving organizational excellence through Human
Resources and follows "People First" approach to leverage the potential of its
23,500 employees to fulfill its business plans. Human Resources Function has
formulated an integrated HR strategy which rests on four building blocks of HR
viz. Competence building, Commitment building, Culture building and Systems
building. All HR initiatives are undertaken within this broad framework to
actualize the HR Vision of "enabling the employees to be a family of committed
world class professionals making NTPC a learning organization.

To induct talent and groom them into a dedicated cadre of power
professionals "Executive Trainee" Scheme was introduced in the year 1977 for
recruitment in the disciplines of Mechanical, Electrical, Civil, Control &
Instrumentation and now encompasses Computer Science, Chemistry, HR and
Finance disciplines also. Besides a comprehensive one year training
comprising theoretical inputs as well as on-the-job training, the new recruits are
also attached with senior executives under a systematic and formal 'Mentoring
System' of the company to integrate them into the Culture of the company.
As part of post employment training and development opportunities, a
systematic Training plan has been formulated for ensuring minimum seven
man days training per employee per year and includes level-wise planned
intervention designed to groom people for assuming positions of higher
responsibility, as well as specific need-based interventions based on scientific
Training Needs Analysis. NTPC has set up 15 project training centers, 2
simulator training centers and an apex institute namely 'Power Management
Institute' (PMI). While the project training centers (Employee Development
Centers) have specialized in imparting technical skills and knowledge, PMI
places emphasis on management development. Besides opportunities for long
term education are also provided through tie-ups with reputed Institutions like
IIT, Delhi, (M.Tech in Power Generation Technology), MDI, Gurgaon (Executive
MBA programmed), BITS, Pilani (B.Tech) etc.

In order to realize the HR Vision of making NTPC a learning
Organization by providing opportunities to continually learn new capabilities a
number of initiatives have been taken. NTPC Open Competition for Executive
Talent (NOCET) is organized every year in which teams of executives compete
annually through oral and written presentation on a topical theme. Similarly
"Professional Circles" have been formed department-wise where Executives
of the department meet every fortnight to share their knowledge and
experiences and discuss topical issues. In order to tap the latent talent among
non executives and make use of their potential for creativity and innovation,
Quality Circles have been set up in various units/offices in NTPC. Besides a
management journal called "Horizon" is published quarterly to enable
employees to share their ideas and experiences across the organization.
Demonstrating its high concern for people, NTPC has developed
strong employee welfare, health & well-being and social security systems
leading to high level of commitment. NTPC offers best quality-of-life through
beautiful townships with all amenities such as educational, medical and
recreational opportunities for employees and their family members. The
motivation to perform and excel is further enhanced through a comprehensive
NTPC Rewards and Recognition system.
In order to institutionalize a strong Culture based on Values a
number of initiatives are taken to actualize the Vision and Core Values

(BCOMIT) across the company. A culture of celebrating achievements and a
strong focus on performance are a way of life in NTPC.
NTPC has institutionalized "Development Centers" in the
company to systematically diagnose the current. And potential competency
requirements of the employees with the objective of enhancing their
development in a planned manner. These Centers give a good insight to the
employees about their strengths and weaknesses, the gaps in their
competencies, which they can bridge through suitable support from company.
Due to innovative people management practices there is a high level of pride
and commitment amongst employees as reflected in the various external
surveys including “Great Places to Work for in India” in which NTPC was rated
third Great Place to work for in the country in 2005.
OWNERSHIP PATTERN
NTPC being a wholly owned Government of India undertaking has an
authorised capital base of Rs.8000 crores fully subscribed by the GOI. The
board of the company comprises of directors appointed by the government as

well as those internally appointed. The CHAIRMAN AND MANAGING
DIRECTOR, followed by the Functional Directors and subsequently the Govt.
Directors and the Non-Official Directors, heads the board.
Below given is the list of the Board of Directors:
POSITIONS NAMES
CHAIRMAN AND
MANAGING DIRECTOR
Shri C.P. JAIN
FUNCTIONAL DIRECTORS Shri K.K. SINHA
Shri P.
NARASIMHARAMULU
Shri R. D. GUPTA
Shri T.
SANKARALINGAM
Shri S. L. KAPOOR
Shri CHANDAN ROY
PART – TIME DIRECTORS Shri ARVIND JADAV
Shri M. SAHOO
NON-OFFICIAL
DIRECTORS
Shri DEEPAK S.
PAREKH
Shri ASHOK MISHRA
Dr. R. K. PACHAURI

“COMPANY VISION”
"To be one
of
the world's largest
And
best power utilities
Powering

India's growth"
COMPANY MISSION
 Make available reliable and quality power in increasingly large quantities
at appropriate tariffs, and ensure timely realization revenues.
 Speedily plan and implement power projects, with contemporary
technologies
 Implement strategic diversification in the areas of R&M, hydro, l.N.G. And
non-conventional and Eco-friendly fuels and explore new areas like
transmission, information technology etc.
 Promote consultancy and make prudent acquisitions
 Continuously develop competent human resources to match world
standards
 Lead fundamental and applied research for adoption of state of the art
technologies, breakthrough efficiency improvements and new fuels.

 Be a responsible corporate citizen with thrust on environment protection,
rehabilitation and ash utilization
NTPC POWER PLANTS

NTPC Limited has bagged the prestigious
DUN & BRADSTREET-AMEX Corporate Award-
2006 for being Number one in the Indian Power
Sector on 5th September 2006.
Shri A.R.Kidwai, Hon’ble Governor of Haryana
presented the Distinguished Fellowship of the Institute
of Director’s (IOD) to Shri T.Sankaralingam, CMD,
NTPC Limited at the 17th Annual Day function of IOD
held in New Delhi on 11 August 2006.
Environment Management Division, NOIDA, won golden Peacock
Eco Innovation & Environment Management Award 2005. The Award was
given on 9th June 2006 at the World Congress on Environment.
NTPC wins "Commendation Certificate for Strong Commitment
Among Large Business Organization" in Sustainability Awards 2006. The

award has been instituted by CII-ITC Center of Excellence for Sustainability.
Development for the first time this year to recognize and reward excellence in
Social, Economic and Environmental Performance.
NTPC Limited ranked first amongst top 10
PSEs for MOU Award for Excellence in
Performance for the year 2003-04. Shri C.P.
Jain, CMD, NTPC also commended for his
contribution as Chairman SCOPE during April
2003-March 2005 through a Special Award. The
Awards where given by Hon’ble Vice President of
India, Shri Bhairon Singh Shekhawat in a function
organized by SCOPE at Vigyan Bhawan on 10th
January, ’06.
Best Companies to work in India – ‘Business Today-Mercer
Consulting 2005’ has rated NTPC as fifth Best Company in India to Work For.
NTPC is the only PSU and infrastructure company to figure in the top 10.
Great Places to Work – NTPC was ranked as Third Great Place
to Work for in India, by a survey conducted by Grow Talent and Business World
– 2005 for the second year consecutively.
Platts Global Energy Award 2005 for Community Development
Program of the Year 2005.

Nine employees of NTPC Ltd. have been
awarded Rashtriya Pishwakarma Puraskar for the
year 2006 on 17th September 2006 in New Delhi.
Five employees of NTPC Ramagundam Project
received category ‘A’ award while 4 employees of
NTPC Dadri Project were presented category ‘C’
award.
Ramagundam, Korba, Kahalgaon and
Rihand projects of NTPC Limited have been
conferred Safety Innovation Award-2006
instituted by Safety and Quality Forum of The
Institution of Engineers (India) New Delhi. The
awards were presented by Sh. R. V. Shahi,
Secretary (Power) and recognize the projects for

their outstanding contribution towards
innovating, promoting and implementing Best
Safety Practices on 6th September 2006.
• NTPC signed a Loan Agreement of USD 300 million with
Asian Development Bank on September 21,2006 at Manila. This was the
first loan syndication deal for an Indian corporate under the Asia
Development Bank’s (ADB) Complementary Finance Scheme (CFS).
The transaction attracted funds of the order of USD 640 million and was
oversubscribed by 2.9 times. 31 foreign banks participated in loan
syndication. Strong financials of NTPC coupled with its practice of
adhering to stringent environmental standards has infused this
confidence in ADB resulting in overwhelming response during
syndication.
• Dr.Manmohan Singh, Hon’ble Prime Minister of India
dedicated the Talcher Super Thermal Power Station to the Nation on
28th August 2006. Situated at Angul Distt. Of Orissa the Station has six
500 MW units with total installed capacity of 3000 MW, and this is the
largest power station of the country.

• NTPC Limited [NTPC] and Singareni Collieries Company
Limited [SCCL] have signed a Memorandum of Understanding [MOU] on
23rd August, 2006 for creation of a Joint Venture Company to undertake
various activities in coal and power sectors. This is the first time that
NTPC has signed such an MOU with any Company in India or abroad.
The MOU will leverage both the Companies to pool in their experiences
and expertise in coal mining and O&M of power plants and pave the way
to put up integrated coal based power stations in India and abroad.
• Hon’ble Union Power Minister; Shri Sushilkumar Shinde
commissioned the first 500 MW unit of Stage – III (2X500 MW) of NTPC
Vindhyachal on 9th August 2006 at Vindhyanagar in Madhya Pradesh.
The total installed capacity of the station has now become 2760 MW and
that of NTPC Limited has risen to 26194 MW. States of Madhya
Pradesh, Maharashtra, Chhattisgarh, Gujarat, Goa and Union Territories
are major beneficiaries of the Station.
• NTPC Limited declared the unaudited financial results for
the quarter ended on June 30, 2006 today. The profit after tax for the
quarter was Rs. 15,528 million as compared to profit after tax of
Rs. 13,087 million reported in the corresponding quarter in the previous
year thus registering a growth of 18.65%. The gross revenue for the
quarter was Rs. 77,905 million as compared to Rs. 66,095 million
reported in the previous year and has grown by 17.87%.

Shri T. Sankaralingam, Chairman & Managing Director, NTPC Limited
was felicitated for his significant achievements and outstanding contribution to
the Power Sector by Alumni of Regional Engineering College, Tiruchirapalli
(Now National Institute)
PROJECTS OF RIHAND
RIHAND SUPER THERMAL POWER PROJECT is a unit of
NATIONAL THERMAL POWER CORPORATION LTD.( NTPC ) is know for its
impeccable standard of production and productivity , a hall- mark of NTPC ,
the 2000 MW Rihand Super Thermal Power Project has taken further strides to
become a trend setter in various facets of power generation , environment
management, rehabilitation and resettlement , ash utilization , safety etc.
RIHAND STPP is known in the country for its unique features such as
tunneling ( 2.1 KM) , under water piling , steel flue chimney , sheet metal clad
turbine hall , 1.0 KM long rail cum road bridge for merry – go- round system ,
under water dredging for creation of channels , composite circuit mid stream
tower and high voltage direct current transmission system etc. Its compact lay
out , integrated control and instrumentation system , advanced fire fighting
system and well designed cable system are also unique features of the
project , which has made this power project a “ MODEL POWER HOUSE” of
NTPC .

PERFORMANCE STAGE - 1
The unit –1 & 2 of the first stage were declared on commercial
operation from January’90 and January’91 respectively during its commercial
operation, the station has many more accolades to its credit this station has
registered more than 100% PLF on two consecutive months of FEB and
MARCH’93.
IMPORTANT MILESTONES
Commencement of work : 09.02.1983
Unit-1 synchronised : 31.03.1988
Unit –2 synchronised : 05.07.1989
First MGR Coal Rake arrived : 02.10.1989
Unit-1 commercialised : 01.01.1990
Unit-2 Commercialised : 01.01.1991

MAX PLF
Unit-1 : 101.53 % (Nov.1991)
Unit-2 : 102.45 % (Feb.1993 )
Station Maximum Generation : 750.242 Mus ( Jan.1992)
PERFORMANCE STAGE -2
NTPC has doubled its capacity of RIHAND project by adding another
1000MW ( 2*500 MW ). Stage – 2 will have dry ash collection system with an
arrangement of rail line for transportation of bulk quantities . For zero
discharge ash water re - circulation system is also being constructed . The ash
bricks manufactured at project are being used in all construction work of stage
–2 .

TOTAL QUALITY MANAGEMENT
To foster a culture of continuous improvement , creativity & innovation , TQM
is an important part of RIHAND management . A dedicated TQM team is
functioning in the project which monitors and facilitates systematic
implementation of various activities of quality circle , professional circle ,
employee suggestion scheme, 5 S, benchmarking , balance score card , ISO –
9001, ISO-14001, ISO-18001 etc.
ENERGY COSERVATION
A senior level team is responsible to look at each system in plant with the area
person to evolve ways and means for energy conservation. This has led to a
significant saving by improvement in the heat rate , saving of DM water , saving
of diesel, saving of electricity consumed in township and plant . The saving
achieved so for is estimated to be in crore in a year . Conservation of energy
is also practiced in the construction activities by adoption of Lawrie Baker
Design for construction of Bal Bhavan

HUMAN RESOURCES DEVELOPMENT
The project has given utmost importance on actualizing NTPC HR
Vision i.e. “ To enable our people to be a family of committed world class
professional , making NTPC a learning organization” . For this , project has
adopted a four pronged HR strategy to build competency , commitment ,
culture and systems . The project has managed to double its capacity with
minimal increase in man power by maintaining its focus on improving
productivity / performance through training and development , knowledge
management , performance management and value based working .

DEPARTMENTS
SECTION : CASH
(SOURCE : ACCOUNT OFFICER)
CORE OBJECTIVE
[1] To maintain the cash & bank book for RhSTPP.
[2] To make the requisition to corporate for receipt of funds.
[3] To make the payment.
PROCEDURE
[1] Daily the cash book & bank is prepared to check the cash & Bank
Balance.
[2] The amount required is to the corporate. The NTPC corporate sends
the required amount to the subsequent bank of Rihand.

RhSTPP has its bank account in the following banks.
BANK PAYMENT MADE FOR
STATE BANK OF
INDIA[SHAKTI NAGAR]
COAL
STATE BANK OF
INDIA[RIHAND]
CIVIL CONSTRUCTION
UNION BANK OF
INDIA[RIHAND]
OPERATION
The cheques are signed as per the delegation of power. The
following is the detail of Delegation Of Power.
5000& below ANY OFFICER
1 LAC & BELOW ANY TWO OFFICER
1 LAC TO 5 LAC 1 ACCOUNT OFFICER & 1
Day.MANAGER
5 LAC & ABOVE 2 Day. MANAGER & ABOVE

The various statements are prepared to streamline the balance
which is as mentioned below:
It contain details regarding the funds received from
corporate as well from parties and employees
It contains details regarding the payments made to
various parties by the way of cheques/dd.
CASH RECEIPT VOUCHER [C.R.V.]
It contains details regarding the cash received from various parties,
bank, and employees
CASH PAYMENT VOUCHER [C.R.V]
It contains details regarding the payments made in cash
BANK RECONCILIATIION STATEMENT is prepared every month
BANK GURANTEES, received from various suppliers/ contractors, are also
kept in cash section. Custody, release, extension of Bank Guarantees is the
responsibility of cash in charge.
NON CASH SECURITIES, such as TDR/FDR/NSC etc. received from
various suppliers/ contractors, are also kept in cash section. Custody,
release, extension of Bank Guarantees is the responsibility of cash in charge.
BANK RECEIPT
VOUCHER [B.R.V]
BANK PAYMENT
VOUCHER [B.P.V.]

SECTION : ESTABLISHMENT
[SOURCE: DY. MANAGER(F& A)]
MAIN OBJECTIVE
To make payment to the employees for various purpose.
• SALARY
• MEDICAL
• L T C
• LOANS & ADVANCES
• ALL THE OTHER REMUNERATION PAID BY NATIONAL
THERMAL COEPORATION LTD to its employees.
The work of establishment deptt. Starts as soon as:
• The appointment letters of an employee reach the establishment
deptt.
• The joining letter of an employee reaches the office.

In payroll [master file] spaces are specified for the following entries,
based upon which “Salary Of An Employee Is Made”.
• NAME OF THE EMPLOYEE
• EMPLOYEE NO.
• DESIGNATION
• SCALE OF PAY
• BASIC PAY
• DATE OF INCREMENT
• LPC [LAST PAY CERTIFICATE]
• RECOVERY OF LOANS & ADVANCE IF TAKEN.VARIATIONS IN
MASTER FILE
1. Absentee treatment the no. of day’s duty is being performed. The
source of this information in time office (P&A).
2. Generation incentive depending upon the generation of plant. The
source of this information is industrial Engineering group, medical
payment of O.T. in the case of workers.

DATA PRESENTATION
GENERATION AND SALES
10
94
40
11
78
90
12
90
40
13
31
78
13
82
76
13
99
10
16
03
87
18
96
94
17
78
68
19
02
06
0
50000
100000
150000
200000
2000-01 2001-02 2002-03 2003-04 2004-05
Rs.
Mil
lio
n
Generation (in Mus) Sales (Rs./Million)

PROFIT AFTER TAX
2815
8
3424
5
3733
8 3539
6
3607
5
0
500
0
1000
0
1500
0
2000
0
2500
0
3000
0
3500
0
4000
0
2000-01 2001-02 2002-03 2003-04 2004-05
Sal
es
(R
s./
Mil
lio
n)

NET WORTH & NET ASSETS
20141
6
22904
5
25811
7
28645
3
31504
0
35447
9
40171
1
42348
9
45041
1
49331
9
15000
0
20000
0
25000
0
30000
0
35000
0
40000
0
45000
0
50000
0
55000
0
2000-01 2001-02 2002-03 2003-04 2004-05
Rs.
Mil
lio
n
Net worth Net Assets

NET BLOCK & GROSS FIXED
ASSETS
15912
0
17033
5
18465
7
17678
1
19865
0
25210
8
28473
8
32307
3
32891
2
36610
6
5000
0
10000
0
15000
0
20000
0
25000
0
30000
0
35000
0
40000
0
2000-01 2001-02 2002-03 2003-04 2004-05
Rs
.
Mil
lio
n
Net Block Gross Fixed
Assets

5.26
5.58
6.11 6.26
6.58
0
1
2
3
4
5
6
7
MUs
2000-01 2001-02 2002-03 2003-04 2004-05
GENERATION PER EMPLOYEE

OPERATIONAL PERFORMANCE
P.L.F
Since its inception NTPC has a record of sustained high level of
performance of all its plants which have facilitated All India PLF (Thermal) to
rise from 55.3% in 1991-92 to 72.1% in 2002-03 (NTPC plants achieved a PLF
of 70.59% in 1991-92 which has increased to 87.54.% in 2004-05).
.

NTPC has not only shown exemplary performance in regard to PLF and
availability but has also maintained excellent performance w.r.t. Other
operational parameters such as heat rate, auxiliary power consumption,
specific fuel consumption etc., which are comparable to the best performance
standards in the world.
Growth in Share Capital and Reserves & Surplus
80000
80000
80000
80000
80000
78125
78125
78125
78125
77215
237002
208400
180082
150979
124333
0
50000
100000
150000
200000
250000
2002-03 2001-02 2000-01 1999-00 1998-99
Year
Rs.Million
Autorised Capital Paid-up Capital Reserves & Surplus

DATA ANALYSIS
MACRO PROCESS MAP
• GROUP WORK STEPS
• USER
DEPTT
• FINANCE
• C&M
• CA
Proposal Generation
Finance Vetting Concurrence
DAL Vetting
Proposal
Approval Approval
DAL
Award

SUB PROCESS- PRE AWARD
 Proposal Estimate Vetting
• Award Proposal Concurrence
• Budget Certification
• Detailed Award Letter Vetting
SUB PROCESS-POST AWARD STAGE
 Tentative/Final Deviations
• Extra/New items/Change in scope
• Provisional/Final Time Extension
• Amendment Vetting

Existing Process Flow Chart of Estimate Vetting
Proposal initiated
By User
Marked to Mgr
Marked to Officer
Financial Concurrence
Send for FES
Clearance

Existing Process Flow Chart of Proposal for
Award Concurrence
Documents/
Clarifications/
FES sought
Send to CA as
Per DOP
Proposal initiated
By C&M
Recd in Finance
Marked to Mgr
Marked to Officer
Financial
ConcurrenceProposal in
orderSend to CA as
Per DOP

Existing Process Flow Chart of
Budget Certification DAL Vetting
Recd in Finance
Marked to Mgr
Proposal initiated
By C&M
Marked to Officer Marked to Officer
Recd in Finance
Marked to Mgr

COVERAGE & ASSUMPTIONS
• 169 proposals have been examined which were awarded during
the period April’03-Dec’04
• Receipt in Finance is considered as the date on which file is
marked by previous authority
• Sent from Finance is considered as the date on which the file is
signed by the last authority
Budget
Certification
Send to C&M
DAL Vetting
Send to C&M

• Regularizing/Covering Work orders and Contracts/Work orders
awarded during emergent Situation e.g.VVIP visits have not
been considered
OBSERVATIONS
Estimate Vetting
• On an average 18 days have been taken for estimate vetting
• Almost 50% cases RIO* for want of documents/clarifications

• Almost 25% cases again RIO for clarifications
• Out of 18 days for estimate vetting, on an average 35% of the time is
consumed to reach a proposal to the concurring officer at each occasion
when file is received in finance
• Approx. 6 days have been taken to concurn the proposal for award.
• On an average 3 days have been taken for Budget Certification
• Almost 4 days have been taken for DAL* Vetting
• Approx. 2/3 of the time is consumed in movement of files.

• It took 31 days for Pre-Award activities relating to Finance
• Out of 31 days, eliminating the procedure of internal marking and
minimizing the RIO’s can reduce 11days
• Initiating the activities of Budget certification and Vetting can save 4
days along with concurrence of award proposals.
• The present time the committee inspection of material code and reduce
the material code to which useful item don’t to be use less to which total
value of inventory decrease.

RECOMMENDATIONS
Certification to be done by concurring officer.
 Proposals to be received by concurring officer directly.
 A detailed checklist containing the documentary requirements of
concurrence to be circulated to user departments to minimize RIO’s.
 Proposals of Construction activities to be cleared by FES before sending
to Finance.
 Proposals for additional manpower deployment /PAP’s* to be cleared by
HR/R&R respectively.
 Post award proposals for Time Extension/ Deviations to be routed
through CS.

 Budget Certification/Vetting should be taken up along with concurring
the proposal for award
CONCLUSION

CONCLUSION
After having gone through all the aspects of the ABT system and
comparing it with existing system, we have reasonably got a deep
insight of the matter.
It is very difficult to conclude very directly in favour or against the
ABT system. ABT is a new concept, which has come into existence
because the existing system had certain limitations. It has been tried to
overcome those limitations, but at the same time it has incorporated
certain financial measures, which seem to be harsh against the
Generators, generating & selling electricity in more than one state.
The ABT system is better in certain respects. The basic and most
important area is f the Grid discipline. In this system, the grid discipline
shall be maintained through financial incentive and disincentive scheme.
Further ABT facilitates trading in capacity and actual power. ABT also

indirectly facilitates Merit Order dispatch, which is in the interests of
economy and efficiency of the power sector as a whole. It is effectively
applicable to both Generators and Bulk Consumers.
Like any system, ABT also has certain drawbacks. The major is
that the State owned generating stations are not covered in this scheme
till date, so the level playing field is not available to NTPC as on date.
However, it is felt that with the creation of all the State ERCs this system
will also be extended to the State owned generating stations also, thus
ensuring level playing field.
This is only a changing phase, a phase of power sector reforms.
In future we are moving towards a free power market, where the market
forces like Demand, supply and competition with minimum government
interference will derive the tariff. This system is prevalent in West and is
known as ‘Auction’ based tariff.
The ABT might be having some negative impact on the
profitability of the NTPC but if we see from the power sector interest and
we compare Indian power sector with the international scenario, the ABT
is a welcome step. It is good that the NTPC is setting new standards as
Benchmark for the power sector in India. NTPC has a long way to go
and it will prove its worth in the new challenging times of ABT regime.

FUND FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH 2005
(Rs million)
Statement of sources and application of funnds
sources 2005 2004
Fund generated from operating activities 74,468 47,473
proceeds from issue of share capital 26,664 nil
Deffered revenue on account of advance 1783 1,320
Interest/ income on bond 14,991 35,930
development surcharge fund nil 3,784
divident recived on investment 117 95
proceeds from long term borrowingds 29,592 37,949
decrease in working capital 93,755
TOTAL 147,615 219,969
APPLICATION
Expenditure on fixed assets 55,089 45,154
purchase of investment 34,167 770
investment in subsidiaries 430 216
purchase of bonds under one time settelment scheme nil 135,720
repayment of long term borrowing 13,242 15,578
Interest 9,740 10,107
guarantee commission and finance charges 1,615 551
development surcharges fund 3,784 nil
Dividend 19,790 10,823
Dividend tax 2,679 1,387
INCREASE IN WORKING CAPITA 7,079
TOTAL 147,615 219,969

BALANCE SHEET TO 2001 TO 2005
PRTICULAR 2005 2004 2001 2002 2003
SOURCE OF FUNDS
SHAREHOLDER'S FUNDS
CAPITAL 82455 78125 78125.49 78125.49 78125
RESERVE AND SURPLUS 335308 277376 180082.4 208399.3 237002
TOTAL 417,763 355501 258207.9 286524.8 315127
DEFERDREVENUE 3374 1591 nil nil 271
DEVELOPMENT
SURCHARGE nil 3784 nil nil nil
FUNDS
LOAN FUNDS
SECURED LOAN 44407 45844 19654.69 16454.99 41,226
UNSECURED LOAN 126471 108684 78392.56 99356.83 90,931
TOTAL 170878 154528 98047.26 115811.8 132,157
DEFFERED TAX LIABILITY 50570 52280 nil nil 44,379
LESS: RECOVERABLE 50569 52279 nil nil 44,378
1 1 nil nil 1
TOTAL 592,016 515405 356255.1 402336.6 447,556
APPLICATION OF FUND
FIXED ASSETS
GROSS BLOCK 431,062 400281 323073.5 328911.6 366,106
LESS:DEPRECIATION 207,914 187736 138416.2 152131.1 167,456
NET BLOCK 223148 212545 184657.4 176780.4 198,650
CAPITAL WORK IN PROGRESS 67063 56413 27896.46 52037.63 51,543
CONSTRUCTION STORE &ADV. 32,222 18540 10268.84 13546.12 12,320
TOTAL 322,433 287498 222822.7 242364.2 262,513
INVESTMENT 207,977 173380 39914.59 40281.14 36,674
CURRENT ASSETS
INVENTORIES 17,777 17380 18355.85 20141.97 17,712
SUNDRY DEBTORS 13,747 4699 95851.39 115328.3 124,349
CASH AND BANK BALANCE 60,783 6091 3829.48 12048.57 5,447
OTHER CURRENT ASSETS 9,714 80019 9703.61 5510.95 25,149
LOAN AND ADVANCES 27,052 27279 33011.35 24742.22 21,475
TOTAL 129,073 135468 160751.7 177772 194,132
LESS: CURRENTLIABILITIES

LIABILITES 52,306 65244 27620.22 31416.99 34,202
PROVISION 15,161 15697 39704.11 26736.09 11,648
TOTAL 67,467 80941 67324.34 58153.09 45,850
NET CURRENT ASSETS 61,606 54527 93427.35 119618.9 148,282
MISCELLANEOUS EXPENDITU. nil nil 90.51 72.38 87
TOTAL 592,016 515405 356255.1 402336.6 447,556
BIBLIOGARAPHY

BIBLIOGRAPHY
BOOKS
• FINANCIAL MANAGEMENT BY I. M. PANDEY
• MANAGEMENT ACCOUNTING BY S. N. MAHESHWARI
• FINANCIAL ACCOUNTANCY BY S.N. MAHESHWARI
JOURNALS
• NTPC NEWS MAGAZINE
• NEWS MAGAZINE “RIHAND SAMACHAR”
REPORTS

• ANNUAL REPORTS OF NTPC
• ANNUAL REPORTS OF NTPC RIHAND
OFFICIAL SOURCES
• RIHAND STPP ORGANISATION
• NTPC RIHAND OFFICIAL RECORDS
WEB SITES
• www.ntpc.co.in
• www.google.com

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