hydro consult pvt. ltd. (hcpl) consult -...

HydroConsultHydro Consult Pvt. Ltd. (HCPL)

Annual Report 2011

Vision

To become a leading professional consulting service provider in the Hydropower sector in Nepal and in the International market.

Mission

To provide quality and cost effective services in energy, environment and other infrastructure projects to meet customer satisfaction.

Objective

To provide innovative and competitive consultancy services in the field of hydropower, water supply, irrigation, transport and other infrastructure related sectors by producing appropriate engineering design and development solutions giving priority to the use of local skills, technology and protection of environment.

Contents

I. Corporate Profile 1

II. Directors’s Report 2

III. Corporate Governance Report 7

IV. Key Staff & Management Team of HCPL 10

V. From the desk of CEO 11

VI. Brief overview on the projects of F Y 2067/68

1. PROJECT NAME: KABELI-A HYDROELECTRIC PROJECT (KAHEP) 12

2. PROJECT NAME: TADI KHOLA HYDROPOWER PROJECT 13

3. PROJECT NAME: BHERI BABAI DIVERSION MULTIPURPOSE PROJECT 14

4. PROJECT NAME: NYADI HYDROPOWER PROJECT (NHP) 16

5. PROJECT NAME: LOWER MANANG MARSYANGDI

HYDROELECTRIC PROJECT 18

6. PROJECT NAME: GURA SMALL HYDROPOWER PROJECT (GSHP) 19

VII. Financial Performance 20

VIII. Financial Statements 2011 25-40

1. Auditor’s Report 27

2. Balance Sheet 29

3. Income Statement 30

4. Cashflow Statement 31

5. Statement of Changes in Equity 32

6. Schedules 32

7. Significant Accounting Policies and 39

Notes Relating to the Annual Account

Annual Report 2011Hydro Consult Pvt. Ltd.

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Corporate Profile

Butwal Power Company Ltd. (BPC) acquired Hydro Consult Pvt. Ltd. (HCPL) in 2009 by holding majority of its shares to run engineering consultancy business independently. BPC Engineering wing BPC Hydroconsult has been able to lead in the field of the Engineering consultancy business through successful completion of National and International projects since 1986 especially in hydropower sector. After acquiring HCPL by BPC, BPC Hydroconsult were merged into it.

HCPL has highly qualified and experienced national and international professionals in various field of engineering. HCPL is equipped with modern software and equipments. At present, HCPL is working together with Bernard (Austria), Mott MacDonald (UK), SWECO (Norway) etc in various hydropower projects.

Corporate Information

Name : Hydro Consult Pvt LtdRegistration No: 8244/054/55Date of Incorporation: 2054/12/11/3VAT No: 500012033Corporate Office: Pabitra Marga, Buddhanagar, KathmanduTel: +977 1 4782507, 4785920Fax: +977 1 4785920Email: [email protected]: www.bpch.com.npBankers: Himalayan Bank Ltd Standard Chartered Bank LtdStatutory Auditor: P. P. Pradhan & Co., Sanepa, Lalitpur

Annual Report 2011 Hydro Consult Pvt. Ltd.

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Financial Performance

The year 2067/68 is proven to be a good start for HCPL. During that fiscal year HCPL has recorded turnover of NPR 56.25 million with net profit of NPR 8.83 million and net worth of NPR 19.59 million. There has been increase of 133% in the turnover, 8.45 times in the net profit and 83% in net worth during the fiscal year 2067/68 in comparison to last fiscal year.

Business Operations

Some of the major jobs accomplished and in progress during the fiscal year 2067/68 are listed below.

• Review for the selection of Regional Hydro Power Plants in Nepal for interconnection to proposed SAARC regional grid was completed.

• Draft report of Detail Design of Bheri Babai Diversion Multipurpose Project, Component B: Hydropower (48MW) was submitted.

• Updated Feasibility Study, Tender Document Preparation, Social Impact Assessment Study, Preparation of ToR and Scoping for EIA and IEE of 37.6 MW Kabeli ‘A’ hydropower project were completed. At present, approval of the submitted documents and finalization of tender documents is taking place including World Bank’s appraisal. Currently detail design of the project is in progress.

• Feasibility study of 140 MW Lower Manang Marsyangdi was completed. EIA study in association with SWECO is in progress. Similarly, tender document preparation and detail design of 140 MW Lower Manang Marshyangdi are continuing.

• Detail design and tender document preparation of 30 MW Nyadi Hydropower project are in progress.

• Construction, Supervision of Sikta Irrigation is continuing.• Detail Design of 4.2 MW Tadi Hydropower Project was completed. Construction Supervision

of the same is in progress with the target to complete by October 2012.

Besides above mentioned projects, several other projects were carried out by HCPL like; Feasibility study and IEE of 42 MW Marsyangdi III, Repair and Maintenance of Khudi HEP, Jhimruk Impact Study and, Review of 15.6 MW Mai Hydropower Project for the consortium of lending institutions lead by Laxmi Bank Ltd.

HCPL has bagged Engineering and consulting job in Kenya for Design Review and Construction Management of 5 MW Gura Hydropower Project.

Dear Shareholders,

Your Board has pleasure in presenting the annual report and the audited statements of accounts of the company for the year ended July 16, 2011.

Directors’ Report


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Board of Directors and Committees

There were changes in representation in the Board during the year. BPC nominated Mr. Radheshyam Shrestha and Mr. Pratik Man Singh Pradhan as its representative in the Board of HCPL. PEEDA has nominated Mr. Gokul Sharma in the Board of HCPL with effect from October 28, 2010 in place of Mr. Balaram Pradhan. We would like to welcome the new Directors and extend our thanks to Mr. Pradhan for his contribution to the Company during his tenure.

The Audit Committee played an important role in strengthening the internal controls and good corporate governance.

Corporate Governance

HCPL has adopted value framework to ensure good corporate governance in the Company. HCPL’s corporate value framework comprises of vision, mission, values, code of conduct and ethics. Corporate Governance standards are reported separately as Corporate Governance Report.

Management

HCPL is managed by a strong team of professionals led by Chief Executive Officer, Mr. Manohar Shrestha.

There were 61 employees at the end of the F/Y 2067/68. List of top management and senior executives is included in the Corporate Governance Report.

The Management expenses in F/Y 2067/68 totaled NPR.10.21 million which is 18% of the total turnover.

Health & Safety

Health and Safety of employees is the most important element in HCPL’s business operation. It has taken all the measures for the safety of its employees at the office and at the sites. Special care has been taken for the safety of field staff at the project sites. There is provision of accident insurance covering 24 hours a day and medical insurance for the employees. In the same way fire and other general insurance have been taken for the safety of office premises and other assets.

Employees are provided with reasonable sick leave, paternity, maternity and personnel leaves considering their health and safety reasons.

Employee Relation and Industrial Associations

HCPL gives top priority on maintaining cordial relations between the management and the employees. HCPL emphasizes on trained and dedicated human resources to meet the present needs and for the future growth of the Company. Several trainings have been provided to the employees for enhancing their skills and work efficiency. Retention of the professionals is the priority of the company.

HCPL has a very healthy relation with other institutions such as Kathmandu University, Institute of Engineering, etc.


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HCPL is working together with Bernard (Austria), Mott MacDonald UK and SWECO in various projects. Similarly, HCPL has close contacts among the local and international experts whenever required. HCPL is active member of the Nepal Hydropower Association.

Business Environment and Related Risk

HCPL is fully financed on Equity. The company doesn’t have any type of bank debt and has sufficient clients to sustain at present. The development of Hydropower project in the country is slow because of the political environment and financial constraints. For sustained growth, HCPL has explored alternate markets and has secured Engineering works in Kenya. Further, HCPL has plans to take over the more local and international projects. Considering this, HCPL’s financial risk on sustainability is substantially low. HCPL has already been able to establish its lead position in the Engineering Consultancy Business, mainly in water resource projects which help to establish and grow HCPL with minimum risk.

At present, HCPL is concentrated mostly on its sister organizations’ projects, so HCPL has to compete for getting the local and international projects in future to cope with the concentration of risk. The risk in consulting business in hydropower sector could be overcome once Hydropower projects development gears up in a real sense for construction at field.

Corporate Social Responsibility (CSR)

From the beginning of consulting services of HCPL, HCPL has contributed on corporate social responsibility like support on different aspects for the benefits of locals and socio-ecological system. Few highlights of CSR are as follows:

• Design of fish ladders in Jhimruk and Andhikhola power plants• Designed and worked for Glacier Lake Outburst Flood (GLOF) risk reduction in Tsho-Rolpa• Designed and implemented REGDAN and REEP programs (under the grants from NORAD

and USAID) which helped to access electricity to thousands of households in BPC’s distribution areas

• Involved in the policy making for BPC for the ISO 14000:2004 certification

HCPL has its notion of social and economic development in the area where it does business. Throughout the company’s journey, HCPL has designed the programs that have effectively contributed to the local socio-ecological system in the project areas.

HCPL has provided financial and technical contribution for the development of Turbine Testing Lab for the benefits of not only the Engineering students of Kathmandu University but also for the overall benefit to all stakeholders in hydropower sector.

Internal Control

HCPL has in place an integrated quality and efficient Management System. Internal Audits are being carried out periodically by the independent auditor for the risk management of the company’s assets, financial and accounting procedures and controls. The recommendations of the internal auditor and the decisions of the Audit Committee are put to action within due time.


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Statutory Audit

M/s PP Pradhan & Co. conducted audit of books of accounts of HCPL. The auditor has issued an unqualified report on financial statements of the company.

Related Party Transactions

All major transactions with BPC and its subsidiary companies are disclosed in the notes of accounts in the Company’s financial report.

Future Prospective & Sector Outlook

HCPL is aiming for expansion of its business both within the country and abroad. HCPL aims to keep best possible resources in order to provide reliable professional engineering services to the Clients. HCPL is also exploring for association with International Consultants (institutions) and Individual Experts to enhance the quality service delivery.

Hydropower sector is the most talked subject in media and lots of studies are being carried out from different levels and capacities from local developers/financers to international developers and big business houses. Tremendous hydropower potential exists within the country, in the mean time, huge energy demand also exists within the country and neighboring countries. In this context, good governance, clear policy and also conducive environment is the need for the development of hydropower sector.

There is tremendous opportunity for the development of Hydropower in Nepal. In this context consultant like HCPL will have lots of opportunities to provide its professional service in the future.

Closing Remarks

We’d like to express our gratitude to our Shareholders, Management Team and Staff for their valuable input and contribution towards the progress of HCPL. We are thankful to our Clients, Associate Institutions, Government of Nepal, Bankers, Auditors, and Individuals who have been contributing for betterment of the company.

Thanking you,

On behalf of the HCPL Board of Directors,

_______________Ranjan LoharChairmanDecember 23, 2011


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Corporate Governance Report

HCPL has the notion of complying with the Organization for Economic Cooperation and Development (OECD ) principles with regard to Corporate Governance. For the efficient and ethical control and direction of the company balance of authority and power is essential. HCPL has the separation of Chief of Executive and Chairman of the Board. Similarly, a separate Audit Committee has been set up since March 2011 for the effective and efficient conduction and control on the financial and other issues of the company.

Share Ownership Structure:

HCPL is a subsidiary company of Butwal Power Company (BPC) Ltd. HCPL has two institutional shareholders. The share ownership structure is as illustrated below:

Name of Shareholder Holding Number of shares

Butwal Power Company(BPC) 80% 80,000People, Energy & Environment Development Association (PEEDA)

20% 20,000

Total 100% 100,000

Brief Profile of the Institutional Shareholders

Butwal Power Company (BPC) Ltd.

Butwal Power Company (BPC) is one of the leading companies in Nepal’s power sector with generation and distribution as its core business areas. Incorporated in 1966 as private company and converted into public limited company in 1993, BPC has a track record of pioneering multi faceted capacity building initiatives in hydropower development.

Pursuing the privatization process, in 2003, the Government of Nepal handed over majority ownership and management control to private investors on public-private partnership model. BPC is registered with the Securities Board of Nepal and listed in Nepal Stock Exchange Limited. Starting off with electrification plan of a small city in the south central Nepal, BPC is the only enterprise which can look back to a four decade long history of success, sustained growth and capacity building in the country.

Through its subsidiary companies, BPC is engaged in operation & maintenance of power plants, consulting engineering of hydropower and infrastructure projects, manufacturing and repair of hydro-mechanical and electro-mechanical equipment for power plants.

BPC is committed to operational excellence and believes in good governance, corporate citizenship and creating value for stakeholders


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People, Energy & Environment Development Association (PEEDA)

People, Energy & Environment Development Association (PEEDA) was established in 1998 through the joint effort of His Majesty’s Government of Nepal (HMGN), United Mission to Nepal (UMN) & Butwal Power Company (BPC) for the development of hydropower in the country. PEEDA aims to mobilize local as well as external resources to harness the indigenous resources of the country thereby promoting poverty alleviation activities. It focuses mainly on institutional development, participation with stakeholders at grass root levels in development activity, research and lobbying for policy change. PEEDA’s team, with its gained experiences in the energy and development sectors, envisioned that economic development can be achieved through sustainable energy development activities, with the particular emphasis of seeing this development reach the poor.

PEEDA seeks partnerships to maximize the utilization of its resources and the assimilation of its outputs. Currently, PEEDA has a partnership or cooperation with the following organizations:

- United Mission to Nepal- Norwegian Himal Asia Mission, Norway- Interserve UK/Wales- Evangelishe Entwiklungsdienst (EED), Germany - Stiftelesen Hjelp til Selvhjelp for Nepal, Norway- South Lalitpur Rural Electrification Cooperative

Board of HCPL

The CEO of parent company BPC is the chairman of the Board. The Vice president of Finance and Business promotion of BPC are the other Board Directors. The Representative of People Energy and Environment Development Association (PEEDA) (Institutional shareholder which holds 20% shares of HCPL) is one of the Directors to the Board. The total of four directors and CEO form the Board of HCPL with one additional alternative Board Director, Chief Finance Manager from BPC. During the year Mr. Gokul Sharma, Mr. Radheshyam Shrestha, Mr. Pratik Man Singh Pradhan were appointed the additional directors as representatives from the Institutional Shareholders. PEEDA has nominated Mr. Gokul Sharma on the Board of HCPL with effect from October 28, 2010 in place of Mr. Balaram Pradhan.Currently, the following are the members of Board of HCPL.

Sno. Name of the Person Position1. Mr. Ranjan Lohar Chairman2. Mr. Gokul Prasad Sharma Director3. Mr. Pratik Man Singh Pradhan Director4. Mr. Radheshyam Shrestha, FCA Director5. Mr. Manohar Shrestha CEO6. Mr. Ratna Shakya Alternative Director7. Mr. Saroj Ghimire Company Secretary

Board of HCPL performs the following functions:

• Reviews, Monitors and Approves major financial results, budgets and corporate strategies.• Advices for the development of the Company to the management


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• Ensures mechanisms are in place for maintaining the integrity of the business• Ensures compliance of legal requirements and industrial norms• Delegates appropriate authority to the management for smooth, effective and efficient

business operations

The Board Meeting is held on monthly basis. The Board Members are provided the updates of the company’s activities on monthly basis.

Total of eight board meetings were held in the fiscal year 2067/68. The attendance in the Board Meeting was as follows:

Board Members Number of Meetings held during tenure

Number of Meetings attended

Mr. Ranjan Lohar 8 8Mr. Manohar Shrestha 8 8Mr. Gokul Prasad Sharma 5 4Mr. Pratik Man Singh Pradhan 4 3Mr. Radheshyam Shrestha, FCA 3 3Mr. Ratna Shakya 8 5Mr. Balaram Pradhan 3 3

Fees & Allowances of Directors

HCPL does not have the provision to provide any financial incentives to its Board of Directors

Ranjan LoharChairman

Manohar ShresthaCEO

Gokul Psd. SharmaBoard Director

Pratik M. S. PradhanBoard Director

Radheshyam ShresthaBoard Director

Ratna ShakyaAlt. Board Director


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Audit Committee

HCPL consists of three members Audit Committee. The committee members are highly efficient and competent with more than two decades of experience in financial and business management. All the three members are the non executive directors of HCPL. The Committee is chaired by the Vice president of Finance of BPC.

Currently the following members constitute the Audit Committee of HCPL:

Sno. Name of the Person Position1. Mr. Radheshyam Shrestha, FCA Chairman2. Mr. Gokul Prasad Sharma Member3. Mr. Pratik Man Singh Pradhan Member

The committee’s meeting is held once in every quarter. HCPL Audit Committee conducts the following functions:• Reviews the Internal Audit report and provides necessary feedback to the management• Ensures the compliance of Accounting policies and standards• Recommends for the appointment of Auditors• Monitors and supervises the Internal Auditor and reviews his/her performance• Performs other tasks related to accounting, financial and audit as directed by the board

of director

Pawan K. KhadkaHead of Finance

Basanta BagalePM - Nyadi

Bibek NeupaneTeam Leader-LMM

Diwas Lal MaskeyTeam Leader-Kabeli-A

Bandhu DhakalTeam Leader-BBDM/Tadi

Saroj Lal ShresthaPM - Gura

Pranav AcharyaChief Environmentalist

Rita ChitrakarPM - Kabeli - A

Guru P. AdhikariPM - LMM

Bharat R. PandeyChief Engineer

Durga Lal ShresthaHead of Admin/HR

Govinda ChalisePM - BBDM/Tadi

Saroj K. GhimireCompany Secretary

Key Staff & Management Team of HCPL


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for strengthening the resources in all fronts like human resources, software, local and international expertise, equipments etc. So, we need to act tactfully in order to enhance and fulfill our objective in future.

Challenge in this sector is “time delay in implementation of Project Construction”. If it continues like now, HCPL may need to only studies of the projects which will not be favorable to all stakeholders in this sector in the long run. HCPL provides quality job. Environment should be developed so that the Clients will also seek for quality engineering job rather than focusing only on cost of the consulting job.

This year, we have had great opportunity to work with renowned international experts (Panel of Experts for World Bank) in Kabeli A. Similarly, we have had very good experience working with different international Consultants like Hydro Tasmania India, Bernard Austria, Mott MacDonald UK, SWECO Norway. This certainly added value in enhancing our capacity and learn more about different working systems and modalities of these International Consultants and Experts.

Overall, this year became more fruitful to HCPL for upgrading its capabilities and also to expand its business. So once again, I would like to thank all the concerns for this achievement and also wish to keep same progress in coming years.

Thank you.

----------------------------Manohar ShresthaCEOHydro Consult Pvt. Ltd.

HCPL, after starting its consulting business independently from BPC Hydroconsult (the engineering department of Butwal Power Company), has been able to show its dynamism and expansion in business gradually

a year after another. This is a very good indication for the Company. In other hand it is a great challenge to the management and staff of HCPL to keep it high ever and maintain its success up to the maximum.

For this all efforts and success on the behalf of HCPL, I would like to thank and extend my sincere gratitude to the Board Chairman and Directors for their valuable support and guidance. Similarly, I’d like to extend my sincere gratitude to the Clients who believed on us for quality job. Finally, I have to give sincere thanks to all HCPL Staff and Managers for their sincere effort and gratitude towards their professional works and towards the Company. I would also like to wish and encourage all our sincere staff to keep high moral, professionalism and dedication at professional work for the successful future of the Company in coming days.

In current scenario, Hydropower sector of the Country, is in the stage where there is need for improvement and speed up. While we count for implementation of the projects all stakeholders including Nepal Government need to look at it seriously and need to establish conducive environment for easy bureaucratic system and for the easy construction of the projects at site without any hassles. Once hydropower sector gears up in construction, then certainly there will be real challenge to cope with the required resources in all fronts. We are also targeting to establish business abroad. In this context, we need to invest

From the Desk of CEO


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Brief overview on the projects of F Y 2067/68

1. PROJECT NAME: Kabeli-A Hydroelectric Project (KAHEP)

------------------------------------------------------------------------------------------------------------------------------------Updated feasibility study, Tender documents and Detailed design of Kabeli-A Hydroelectric Project located in Panchthar district of Nepal, 802 km (2 days drive) east of Kathmandu.------------------------------------------------------------------------------------------------------------------------------------

Kabeli-A HEP is a peaking run-of-river project with a installed capacity of 37.6 MW.

Main Feature of the Project

• Design Discharge : 37.73 m3/s • Gross Head : 118.8 m• Net Head : 112.6 m• Catchment Area : 862.3 km2• Install Capacity : 37.6 MW• Annual Energy : 202.6 GWh• Barrage : 60 m long concrete barrage with four radial gates (10.0 m x 9.0 m)• Intake : Two side intake of orifice type at left bank of the river• Waterway : 4237 m long low pressure headrace tunnel and 223 m long steel penstock pipe of diameter 3.55 m• Powerhouse : Semi-underground powerhouse of 34.8 m x 18.6 m x 31.8 m• Turbine : 2 units of Vertical Shaft Francis Turbine with 375 rpm• Estimated Project Cost : US$ 70.84 Million

Services Rendered

Updated Feasibility Study

• Review of 1998 feasibility study and EIA study• Collection of information and review of previous studies • Program additional surveys and field investigations • Topographic survey • Hydrological, meteorological and sediment studies • Geological and geotechnical investigations and material testing • Hydraulic model tests • Glacial lake outburst floods (GLOF) study


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• Project layout and design• Risk register• Optimization study of scheme and project components• Construction planning and cost estimates • Economic evaluation and financial analyses • Environmental and socio-economic impact analyses• Study of project implementation

Tender document and detail design study

• Refine the design• Preparation of NCB and ICB standard tender document with specification for all lots

including hydro-mechanical and electro-mechanical• Preparation of tender drawings• Design Basis Memorandum (DBM)• Quality Assurance Plan• Risk Management Plans for surface and underground structures• Dam Safety Plan• Instrumentation plan• Structural analysis• Prepare detail design RC drawings• Detail Design Report

Client: Kabeli Energy Limited (KEL)

2. PROJECT NAME: Tadi Khola Hydropower Project

------------------------------------------------------------------------------------------------------------------------------------Tadi Khola Hydropower Project is Run-of-river project situated in the lesser Himalayan region. It is located in Nuwakot District of Nepal, 91 km (4 hours drive) north from Kathmandu.------------------------------------------------------------------------------------------------------------------------------------

Main features of power plant

• Design Discharge : 7.2 m3/sec• Gross head : 74.12 m• Net Head : 68.95 m• Catchment area : 247 km2


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• Installed Capacity : 4.2 MW• Annual energy : 29.267 GWh• Diversion Weir : 35 m long Semi-permanent boulder concrete cut-off wall • Intake : Two side intake of orifice type at right bank of the river• Waterway : 471m long box culvert (2 m x 2 m) followed by 1.9 m diameter penstock pipe of 1770 m length• Powerhouse : Surface powerhouse of 26 m x 10.2 m x 14.5 m• Transmission Line : 8 km long 33 kV Transmission Line will be build to connect at Chaugada Substation • Turbine : 2 unit of Horizontal Shaft Francis Turbine with 750 rpm• Estimated Project Cost : NPR 824 Million including interest during construction

Services Rendered

• Detail design of all civil components and preparation of construction drawing with reinforcement detail

• Tender/contract document preparation for Civil works, hydromechanical and Electromechanical works on the basis of FIDIC

• Construction supervision and technical management of Headworks, Waterway, Powerhouse, Tailrace and Switchyard

• Preparation of As-built drawing and Project Completion Report• Review of design of Hydromechanical and Electromechanical equipment• Installation supervision of Hydromechanical and Electromechanical equipment

Client: Aadishakti Bidhut Bikash Company Pvt. Ltd.

3. PROJECT NAME: Bheri Babai Diversion Multipurpose Project

------------------------------------------------------------------------------------------------------------------------------------Detail Design and Tender Document Preparation of Bheri Babai Diversion Multipurpose Project, Component B; Hydropower located in the Surkhet District of Nepal, about 562 km(west) from Kathmandu.------------------------------------------------------------------------------------------------------------------------------------

Bheri Babai Diversion Multipurpose Project is a Run-of-River type project with an installed capacity of 47.85 MW. It is aninter basin project diverting the water from Bheri River to Babai River. In addition, this project is multi disciplinary project utilizing the water of Bheri River for both hydropower and


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irrigation purposes. The project area lies in the region occupied by the rocks of the Siwalik Group and the soil above this.

Main features of power plant

• Design Discharge : 40 m3/sec• Gross head : 151 m• Net Head : 133.75 m• Catchment area : 120.62 km2• Installed Capacity : 47.85 MW• Annual energy : 391.37 GWh• Diversion Weir : 114.3 m long Barrage system with six radial gates of width 15.3 m each • Intake : Six no of side intake of orifice type on the left bank of the river• Headrace Tunnel : 12 km long, Horseshoe shaped, concrete lined with internal finish diameter of 4.2 m. Most of the tunnel section penetrates through the poor rocks except few parts of thick to very thick bedded sandstone of the Middle Siwalik • Surge shaft : Restricted orifice type of 13.25 m diameter and 62.5 m height• Penstock : 3.85 m diameter Steel Pipe of 770m long having thickness up to 30 mm• Powerhouse : Surface powerhouse of 36.5 m x 15 m• Transmission Line : 1.5 km long 132 kV Transmission Line will be build to connect at proposed substation at Babai Colony • Turbine : 2 unit of Vertical Shaft Francis Turbine with 375 rpm• Estimated Project Cost : NPR 26.2 Billion

Services Rendered

• Field investigation including topographical survey, hydrological, meteorological and sedimentological studies, construction material survey and logistic survey

• Verification of geological and geotechnical field investigation • Optimization of project layout and design• Hydraulic and structural design of all structures such as diversion dam, intake, desanding

basin, bridge, waterway, powerhouse, tailrace and switchyard • Design of power generating equipment and substation, including auxiliary equipment• Design of hydraulic steel structures such as gates, valves and penstock pipes• Preparation of construction plan and schedule for implementation• Cost estimate, preparation of cash flow, assessment of economic and financial analysis• Tender document preparation for Civil works, hydromechanical and Electromechanical

works on the basis of FIDIC• Preparation of design reports and drawings

Client: Bheri Babai Diversion Multipurpose Project, Department of Irrigation, Government of Nepal


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4. PROJECT NAME: NYADI HYDROPOWER PROJECT

------------------------------------------------------------------------------------------------------------------------------------Feasibility study review, Detailed engineering design and Construction supervision of Nyadi Hydropower project located in Lamjung district of Nepal, 220 km (7 hours drive) north-west of Kathmandu.------------------------------------------------------------------------------------------------------------------------------------

Nyadi Hydropower project is Run-of- river project situated in between the lesser and Higher Himalayan region.

Main features of Nyadi Hydropower Project

• Design Discharge : 11.08 m3/sec• Gross Head : 333.90 m• Net Head : 324.80 m• Catchment Area : 154.7 km2• Installed Capacity : 30 MW• Annual Energy : 168.55 GWh• Diversion weir : 14 m length and 10 m high weir with orifice type frontal intake

and two radial bottom sluice gates• Waterway : 3937m Headrace tunnel (3.2 m*3.2 m) followed by 1.75 m

diameter of penstock of 676 m length• Powerhouse : Underground powerhouse of 53.25 m*14.40 m*12.50 m• Turbine : 3 Unit of Horizontal axis Pelton Turbine• Transmission Line : 7 km long 132 KV transmission line will be build to connect at

Tunikharka substation• Estimated Project Cost : 58.84 US$ million

The study included optimization of capacity and 7 km long 132 kV transmission line for connection at NEA’s Hub at Tunikharka.

Services Rendered

• Review of Feasibility Study and Finalization of option (Surface or Underground)• Detailed design calculations, construction drawings preparation and design report of all

civil works• Detailed Design, manufacturing, installation of all hydro-mechanical items • Electromechanical Detailed design


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• Tender Document preparation for civil works, Hydromechanical, Electromechanical, Transmission line, Access road and staff housing

• Construction Supervision, Manufacturing monitoring, Progress monitoring and Commissioning

• Mitigation measures• Preparation of as built drawings and project completion report.

Client: Nyadi Hydropower Limited


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5. PROJECT NAME: LOWER MANANG MARSYANGDI HYDROELECTRIC PROJECT

------------------------------------------------------------------------------------------------------------------------------------LMMHEP is a run-of-the-river (RoR) type project, located in Manang District of Western Development Region of Nepal. ------------------------------------------------------------------------------------------------------------------------------------

LMM HEP is a run-of-river project with installed capacity of 140.51 MW. The design discharge is 52 cumecs and the gross head is 320m. Energy generated is estimated to be 734.92 GWh consisting of dry season energy of 95.87 GWh and wet season energy of 639.05 GWh. Total net sellable annual energy is 698.22 GWh.

Main Feature of the Project

• Design Discharge : 52 m3/s • Gross Head : 320 m• Net Head : 312.21 m• Catchment Area : 1694 km2• Install Capacity : 140.51 MW• Annual Energy : 734.92 GWh• Diversion Weir : 45 m long concrete ogee type• Intake : Four side intakes, 7.6 m wide and 3 m high.• Waterway : 4800 m long Horse shoe shaped headrace tunnel• Powerhouse : Semi underground powerhouse of 45.80 m long and 18 m wide• Transmission Line : 10.8 km long 132 kV, Double circuit• Turbine : 2 unit Vertical axis Pelton, six jet with 250rpm• Estimated Project Cost : US$ 273.317 million

Services Rendered

• Feasibility study • Tender document preparation• Detail design• EIA- TOR and Scoping• Supervise additional surveys and field investigations• Hydrological and meteorological studies• Supervise Hydraulic model tests• Construction planning and cost estimates• Economic evaluation and financial analyses• Environmental and socio-economic impact analyses

Client: Butwal Power Company (BPC)


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6. PROJECT NAME: GURA SMALL HYDROPOWER PROJECT (GSHP)

------------------------------------------------------------------------------------------------------------------------------------Design Review and Construction Management of GURA Hydropower Project (5.0 MW) located in Naiyeri District of Kenya.------------------------------------------------------------------------------------------------------------------------------------

GURA Hydropower Project is Run off River Project.

Main features of Gura Small Hydropower Project

• Design Discharge : 4.5 m3/s • Gross Head : 154.5 m• Net Head : 147.54 m• Catchment Area : 135 km2• Install Capacity : 5 MW• Annual Energy : 2548 GWh• Diversion Weir : 35 m long concrete ogre type• Intake : Two side intake of orifice type at right bank of the river.• Waterway : 6665 m long concrete Canal & 392 m long steel penstock pipe• Powerhouse : Surface powerhouse of 18.3 m x 10.5 m x 5.5 m• Transmission Line : 17 km long 33 kV Transmission Line will connect at Othaya Substation• Turbine : 2 unit of Horizontal Shaft Pelton Turbine with 750 rpm• Estimated Project Cost : US$ 14 Million The study included optimization of capacity and 35 km long 11 kV transmission line for connection.

Services Rendered:

• Review the contract documents and technical specification• Provide technical assistance for tender issuance, evaluation, negotiation and award.• Construction monitoring progress and implementation.• Quality control during construction• Review and approval of the construction plan, quality assurance plan and schedule of

EPC contractor• Prepare and issue variation order• Coordinate the plant testing and commissioning and commercial operation• Approve the As-built drawing prepare by EPC contractor

Client: Kenya Tea Development Agency (KTDA)


20

Financial Performance

Highlights from Income Statement

• In the fiscal year 2067/68, HCPL generated NPR. 56.256 million Revenue from Consultancy Business. The revenue increased by 133% over the last year. Non Operating income constitutes Interest on Deposit and Rental of Assets. The Non Operating Income was NPR. 0.260 million. The Non Operating Income increased by 12.7 times over the last year.

• The Operating Expense was NPR. 43.55 million in fiscal year 2067/68. Relative increment of 91% was observed on operating expense over the last year. With the growing business activities, the direct expense increased by 49% and administrative expense increased by 5.5 times.

• Net Operating Profit increased to NPR.12.70 million from NPR. 1.36 million. The Net Operating Profit increased by 9.31times over the last year.

• The taxable income amounted to NPR. 11.785 million; NPR.2.946 million has been provisioned for the tax payment.

Highlights from Statement of Financial Position

• HCPL made capital expenditure of NPR. 5.65 million including equipments and software worth NPR.3.79 million and furniture worth NPR.1.86 million. An increase of 54% in overall capital expenditure and 91% on equipments were observed in the fiscal year 2067/68.

• The retained earnings increased to NPR. 9.49 million from NPR.0.654 million indicating 14.5 times increase in the overall reserve over the last fiscal year.

• HCPL maintained a good receivable management and credit payments. Both the receivable and payable figures have been substantially decreased with effective management of working capital.

• The Net worth of the company increased to 19.59 million from 10.65 million giving rise of 83% in the net worth over the last fiscal year.

Value Addition to the Nation

HCPL contributed the following amounts to Government Revenue

Value Addition FY 2067/68 FY 2066/67Corporate Tax 2,946,277 314,769Employee Tax 1,373,203 184,456TDS 821,930 287,225Value Added Tax 4,811,454 1,019,301

Total 9,952,864 1,805,751


21

Financial Ratio

SN Parameters UOM F.Y 2066/67 F.Y 2067/68 BudgetI Liquidity Ratios 1 Current Ratio x 1.14 1.46 1.31 II Profitability Ratios Profitability Ratios related to Sales Profit Margins 1 Gross Profit Margin % 17% 46% 33%2 Operating Profit Margin % 17% 46% 33%3 Net Profit Margin % 4% 16% 14% Expenses 4 Operating Expenses Ratio % 83% 54% 67%5 Administrative Expenses Ratio % 11% 18% 12%III Investments Ratio 6 Return on Assets % 8% 42% 48%7 Return on Capital Employed % 8% 41% 48%8 Return on Equity % 8% 41% 48%9 Book Value Per Share NRs 120.77 209.16 232.93

10 Earnings Per Share NRs 9.44 88.39 111.69 11 P/E Ratio x NA NA NAIV Assets Efficiency Ratios 12 Total Assets Turnover Ratio x 2.00 2.69 3.44 13 Working Capital Turnover Ratio x 7.28 5.80 4.59 V Capital Structure

14 Debt-Equity Ratio x NA NA NA15 Equity to Assets Ratio x 1.38 1.86 1.30

Ratio Interpretation

During the fiscal year 2067/68, the company generated NPR. 56,256,868 from consultancy business and NPR. 260,342 from interest and other income. This shows the company has been successful to generate 133% more revenue from consultancy business in comparison to the revenue of last fiscal year.

Profitability Ratio

The gross profit margin, which was 17% in the fiscal year 2066/67, increased to 46% in 2067/68 showing above the budgeted result of 33%. The net Profit margin substantially increased to 12%. This increment is 100% over the fiscal year 2066/67’s corresponding figure.


22

Expenditure to Sales Ratio

The direct expenditure was 54% of the total revenue which was below the budgeted figure and the corresponding figure of fiscal year 2066/67. This indicates the company has been able to control the direct cost of the projects efficiently.

The administrative expenditure increased over the budgeted figure. The rental expenditure and the writing off of the receivables increased the administrative expenditure substantially. The company has already commenced the budgetary measures to cope up with the increasing administrative expenses.


23

Investment Ratio

Both the Return on Assets and Return on Capital Employed substantially increased. The company has been able to provide substantial return to the investors.

The Book value per share and the earning per share substantially increased in comparison to fiscal year 2066/67 but were slightly below the budgeted figure.

Assets Efficiency Ratios

The total assets turnover ratio slightly increased whereas the working capital turnover ratio decreased. The major factors responsible for the decrease were the bank balance and the receivables. Since the company has under taken international projects as well as VAT and tax obligations, the cash in hand could not be invested for short term purposes.


24

Financial Risk Analysis

Since the company has been 100% equity financed, the financial risk from gearing effect is negligible. The company is currently providing consultancy service for Hydro Power wing of Bheri Babai Multipurpose Project, Kabeli A, Gura SHP Project(from Kenya), Lower Manang Marshyangdi, Nyadi, Tadi, Upper Mai Khola, Jhimruk, Adhikhola as well as Khudi Hydro Power projects. The company has significant projects in hand for the next two to three years. Besides that the company has been initiating to win the contracts for the international projects. Thus the financial risk from operation is also negligible for few years. The company has already been able to establish its name in the Engineering Consultancy Business. Hence, the threat of survival is also nominal.Despite these facts, the company’s business is concentrated mostly on its sister organizations. So, the company has to compete for getting the local and international projects other than that of sister concerns to cope up with the concentration risk.

For the Engineering Consultancy business, the local market is still not fully developed. The problem of funding and presence of low bowling service providers impose major risk in Engineering Consultancy Business. Thus the company is also not aloof from such risk.


25

Financial Statement 2011


26

Kabeli - A Hydroelectric Project Area


27


28


29

Hydro Consult Pvt. LtdBalance Sheet

As on Ashad 32, 2068( July 16, 2011)

Particulars Sch. F.Y 2067/68NPR

F.Y. 2066/67NPR.

1. SOURECS OF FUND 1. Shareholder’s Fund Share capital Reserve and Surplus Total Shareholder’s Fund 2. Other Funds Advance Share Capital

12

10,000,000.00 9,493,370.36

19,493,370.36 -

1,422,655.85

10,000,000.00 654,539.09

10,654,539.09

1,422,655.85

TOTAL 20,916,026.21 12,077,194.94

2. APPLICATION OF FUND 1. Fixed Assets Gross Block Less: Depreciation reserve Net Block (A) 2. Current Assets: Debtors and Accounts Receivable Cash in hand and at Bank Current work in progress Advance and Deposit Paid

3

4 5 6 7

16,094,528.35 (4,874,177.56) 11,220,350.79

16,780,009.26 9,302,881.30 2,388,164.85 2,188,181.39

10,445,097.72 (1,690,357.03) 8,754,740.69

19,546,975.74

745,057.23 3,229,680.96 3,226,827.00

Total Current Assets 30,659,236.80 26,748,540.93

3. Less: Current Liabilities and Provisions Creditors and Accounts Payable Advance and Deposit received Provision for Bonus Provision for Tax Other Provisions

8 9

7,601,917.93

9,236,855.53 1,178,510.83 2,946,277.09

-

19,711,313.59 3,115,695.00

125,907.02 314,769.06 158,402.00

Total Current Liabilities and Provisions 20,963,561.38 23,426,086.67

Net Current Assets 9,695,675.42 3,322,454.26

TOTAL 20,916,026.21 12,077,194.95

Schedule 1-14 form an integral part of this financial statement.

---------------------------- ---------------------------- ---------------------------- Ranjan Lohar Radheshyam Shrestha Pratik Man Singh Pradhan Chairman Director Director

As per our record of even date

---------------------------- ---------------------------- ---------------------------- Gokul Sharma Manohar Shrestha Pratap Prasad Pradhan Director Chief Executive Officer For PP Pradhan & Co. Chartered Accountant

---------------------------- Pawan Kumar Khadka Senior Finance Officer


30

Hydro Consult Pvt. Ltd,Income Statement

For the Year Ended 2067/68 (July 16 2011)

Particulars Sch. F.Y 2067/68NPR

F.Y. 2066/67NPR

OPERATING INCOMEConsultancy Services Other Operating IncomeTotal Operating IncomeOPERATING EXPENSEDirect CostTotal Operating ExpenseGross Operating ProfitAdministrative and Other ExpensesAdministrative ExpensesDepreciationFinance CostTotal Administrative and Other ExpensesNON-OPERATING INCOME: Interest on DepositMiscellaneous IncomeTotal Non-Operating IncomePROFIT BEFORE BONUS AND TAXProvision for Employee BonusPROFIT BEFORE TAXProvision for Corporate Tax

10

12

13

11

56,256,867.68

- 56,256,867.68

30,155,265.07 30,155,265.07 26,101,602.61

10,214,504.86 3,183,820.52

- 13,398,325.38

130,341.70 130,000.25 260,341.95

12,963,619.18 1,178,510.83

11,785,108.35 2,946,277.09

24,190,724.16

- 24,190,724.16

20,176,478.07 20,176,478.07 4,014,246.09

1,856,223.87 793,541.33

- 2,649,765.20

20,502.97 -

20,502.97 1,384,983.86

125,907.62 1,259,076.24

314,769.06

Net Profit for Appropriation 8,838,831.26 944,307.18

Profit & Loss Appropriation Account

Last Year’s BalanceProfit for this fiscal yearTotalLess: Proposed DividendPrior Year Adjustment

654,539.09 8,838,831.26 9,493,370.35

- -

(289,768.08)944,307.17 654,539.09

- -

Balance Transferred to Balance Sheet 9,493,370.35 654,539.09

Schedule 1-14 form an integral part of this financial statement.






31

Hydro Consult Pvt. Ltd,Cashflow Statement

As on Ashad 32, 2068 (July16 2011)

Sno. Particulars F.Y 2067/68 NPR

F.Y. 2066/67 NPR

A.1

123

12

123

Cash Flow from Operating Activities Profit before Tax Add: Depreciation Bonus Provision Other Provisions Less; Interest Income Bonus paid Cash Flow before Working Capital adjustments Decrease (Increase) in Current Assets Increase (Decrease ) in Current Liabilities Other Provisions Operating Cash flow before tax adjustment Less: Tax Paid

11,785,108.35

3,183,820.52 1,178,510.83

-

(130,341.70) (125,907.02)

15,891,190.98 5,183,100.27

(6,146,637.13) -

14,927,654.12 (850,741.13)

- 1,259,076.23

- 793,541.33 125,907.62 158,402.00

- (20,502.97)

2,316,424.21

(23,694,843.13) 21,835,008.59

(486.00) 456,103.67

-

Net Cash Flow from Operating Activities 14,076,912.99 456,103.67

B12

Cash Flow from Investing Activities Fixed Assets Sales( purchased) Interest Income

(5,649,430.63) 130,341.70

- -

(9,276,099.47) 20,502.97

Net Cash Flow from Investing Activities (5,519,088.93) (9,255,596.50)

C123

Cash Flow from Financing Activities Issue of Share Capital Advance Share Capital Accumulated Loss

- - -

- - -

2,000,000.00 1,422,655.85 6,000,000.00

Net Cash Flow from Financing Activities - 9,422,655.85

DEF

Net Change in Cash & Cash Equivalent (A+B+C) Cash and Bank Balance at the Beginning of the Year Cash and Bank Balance at the End of the Year

8,557,824.08

745,057.22 9,302,881.30

- 623,163.02 121,894.20 745,057.22

Schedule 1-14 form an integrral part of this financial statement.






32

Hydro Consult Pvt. LtdStatement of Changes in Equity

For the year Ended Ashad 32,2068(July 16,2011)

Particulars Share Capital Retained Earnings TotalLast Year's Balance 10,000,000.00 654,539.09 10,654,539.09 Proposed Dividend for the year - - Profit for the year 8,838,831.26 8,838,831.26 Prior Year Adjustment - - - Balance as on 32nd Ashad 2068 10,000,000.00 9,493,370.35 19,493,370.35

Schedules to the Balance Sheet

Schedule 1Share Capital

Particulars F.Y 2067/68NPR

F.Y. 2066/67NPR

Authorised Share Capital (2,00,000 ordinary shares of Rs. 100 each) Issued and called up Capital (1,00,000 ordinary shares of Rs. 100 each) Paid up Share Capital (1,00,000 ordinary shares of Rs. 100 each)

20,000,000.00

10,000,000.00

10,000,000.00

20,000,000.00

10,000,000.00

10,000,000.00

Total 10,000,000.00 10,000,000.00

Schedule 2Reserve and Surplus


F.Y. 2066/67NPR

Retained Earnings This year Last year

8,838,831.26

654,539.10

944,307.17

(289,768.08) Total 9,493,370.36 654,539.09

Schedule 4

Debtors and Accounts Receivables


F.Y. 2066/67NPR

Butwal Power Company Ltd. Nyadi Hydropower Ltd. Kabeli Energy Ltd. BPC-ERMC JV Adisakti Bidyut Bikash Company Khudi Hydropower Ltd.

2,157,821.39 -

10,063,132.20 2,893,699.18

739,405.07 925,951.42

194,866.32 9,319,084.17 5,232,605.37 3,974,287.50

- 826,132.38

Total 16,780,009.26 19,546,975.74

As on Ashad 32, 2068 (July 16 2011)


33

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34

Hydro Consult Pvt. Ltd. Schedules to the Balance Sheet

As on Ashad 32, 2068 (July 16, 2011) Schedule 5

Cash in Hand and at Banks


F.Y. 2066/67NPR

Cash in Hand Standard Chartered Bank Nepal Ltd. Bank of Kathmandu Ltd. Himalayan Bank Ltd.

6,973.21 25,204.74 81,311.24

9,189,392.11

12,878.65 103,204.74

81,311.24 547,662.60

Total 9,302,881.30 745,057.23

Schedule 6 Current Work in Progress (WIP)


F.Y. 2066/67NPR

Screening and Ranking Project Nyadi Hydropower Project Tadi Khola HP Gura SHPP Sustainable land use and agro Ent.

- 986,423.42 976,675.41 425,066.02

-

1,383,942.42 1,513,107.05

302,965.93 -

29,665.56 Total 2,388,164.85 3,229,680.96

Schedule 7

Advance & Deposit Paid


F.Y. 2066/67NPR

Business Advance to Staff Advance to Associate Companies Telephone Deposit Short term Deposit Niltara W & E Pvt. Ltd Power Communication Pvt. Ltd Prepaid Expenses Miscellaneous Deposit Salary Advance Advance Income Tax upto -65-66 Advance Income Tax -66-67 Advance Income Tax -67-68 Devi Maya Shrestha (House Owner)

28,221.71 -

31,500.00 -

100,000.00 30,000.00 77,898.61

4,500.00 66,849.00

1,717,612.07 131,600.00

7,805.00 1,984,114.00

10,000.00 5,000.00

- -

34,768.00 3,500.00

- 297,589.00 884,051.00

- -

Total 2,188,181.39 3,226,827.00


35

Schedule 8Creditors and Accounts Payable


F.Y. 2066/67NPR

Butwal Power Company Ltd. Nepal Hydro & Electric Ltd. Hydro Engineering Services Pvt.Ltd. Cybernetics Pvt. Ltd. Matrix Trading Pvt. Ltd Subidha Sewa Pvt. Ltd. B.S.Trading Nissan Securities Pvt. Ltd. East Surveying Pvt. Ltd. TDS and Remuneration Tax Payables Salary Payable Provision for Audit fee BPC Employees Welfare Fund Provident Fund Deduction Citizen Investment Trust Deduction VAT Payable Other Payables Pasupati Marketing & Sales Subisu Cable Net Gates Computer Pvt. Ltd NLG Insurance Company Ltd. Palm Infotech Pvt.Ltd Other Liabilities to Employees East Management & Engineering Saroj Cold Store Nepal Environment & Scientific Pvt. Ltd

- - - -

23,192.00 33,425.31 22,366.55 34,119.00

236,302.00 427,498.09 859,893.00

94,600.00 29,687.00 76,988.00

492,926.00 4,586,084.03

28,254.30 19,080.00 20,070.00 15,944.50 34,215.02

1,376.00 550,764.78

780.00 10,015.00

4,337.35

17,061,610.24 374,121.01 180,554.66 199,318.00 299,566.15

- - -

303,666.15 6,496.00

14,775.00 9,413.00

92,440.00 87,777.00

1,002,363.38 79,213.00

- - - - - - - - -

Total 7,601,917.93 19,711,313.59

Schedule 9 Advance & Deposit Received


F.Y. 2066/67NPR

Advance received from Adishakti Bidhyut Bikash Reliance Hydropower Private Limited Himalayan Water Research & Energy(HWREDC) EMI of Hire Purchase Loan Support Loan Advance received from Gura SHP

- 600,000.00 490,000.00

- 21,406.00

8,125,449.53

2,007,000.00 600,000.00 490,000.00

18,695.00 - -

Total 9,236,855.53 3,115,695.00


36

Hydro Consult Pvt. Ltd.Schedules to Income statement

For the Year Ended on Ashad 32, 2068 (July 16, 2011)

Schedule-10Income


F.Y. 2066/67NPR

Consultancy Services 56,256,867.68 24,190,724.16

Total 56,256,867.68 24,190,724.16

Schedule-11Interest Income


F.Y. 2066/67NPR

Interest 130,341.70 20,502.97

Total 130,341.70 20,502.97

Schedule-12Direct Cost


F.Y. 2066/67NPR

Staff Cost (Sub Sch-12.1) Engineering Consultancy (Sub Sch-12.2) Field Expenses (Sub Sch-12.3) Vehicle Operation (Sub Sch-12.4)

20,167,473.22 8,320,895.45

963,077.93 703,818.47

-

4,888,068.00 14,660,956.44

542,835.00 84,618.63

Total 30,155,265.07 20,176,478.07


37

Hydro Consult Pvt. Ltd.Schedules to Income statement


Schedule-13 Administrative and Other Overhead


F.Y. 2066/67NPR

A. Administrative Overhead Office Rent Electricity & Water House Keeping Minor Furniture and Fixtures Minor Office Supplies Repair & Maintenance Computer Expenses Photocopy & Binding Printing & Stationery Stationeries Communication Related Expenses Advertising Books, Newspaper & Magazine Gift and Donation Membership & Renewal Fee Transportation & Fares Official Meeting Expense Training & Seminar Staff Refreshment Guest Entertainment Medical Expenses Photo & Audio/Video Expenses Working Dress Regular Servicing & Maintenance Provision for Bad Debt Bank Charges

1,670,266.36 472,337.56

66,533.05 23,650.00

695,228.00 144,325.70

98,168.79 279,101.12 321,354.90 219,795.00 562,248.05 118,564.00

27,049.31 21,400.00

241,920.00 362,103.50

3,728.00 281,775.90 345,609.98

63,346.00 12,812.00

100.00 - -

1,984,114.00 500.00

475,693.50 17,224.21 20,166.00

3,500.00 52,552.00

194,437.00 71,381.38 21,628.50 10,045.00

102,048.15 123,831.29

- 3,100.00

- -

110,178.00 -

158,743.50 28,430.00

6,325.00 357.00

1,215.00 10,000.00 20,368.00

- 1,000.00

Total 8,016,031.22 1,432,223.53

B. Other Overhead AGM Expense Consultancy Audit Fee and Expenses Legal Fee and Expenses Board Meeting Allowance and Expenses Tender Bidding Expenses Security Charge Business Promotion International Travel Puja Expenses Service Fee Miscellaneous Expenses Office Support Service

31,155.85

- 120,000.00

19,248.60 2,523.65

14,027.75 336,747.00 185,650.50 945,296.50

35,248.00 20,510.00 24,582.00

463,483.79

- 12,000.00 15,000.00

- - -

68,250.00 4,135.00

97,961.00 -

164,267.25 11,000.00 51,387.09

Total 2,198,473.64 424,000.34

Total (A+B) 10,214,504.86 1,856,223.87

Amounts in NRs


38

Hydro Consult Pvt. Ltd.Sub Schedules to Profit and Loss Account


Sub Schedule-12.1Staff Cost


F.Y. 2066/67NPR

Salary Allowance Provident Fund Leave Daily Wages Overtime Payment for Deputed Staff Insurance Dashain PLI

8,594,497.41 8,568,193.82

507,050.00 704,087.16 105,226.00

49,546.00 -

179,861.30 451,099.00

1,007,912.53 -

2,359,752.00 2,109,051.00

178,424.00 -

75,225.00 7,214.00

158,402.00 - - - -

Total 20,167,473.22 4,888,068.00

Sub Schedule-12.2Engineering and Consultancy Expenses


F.Y. 2066/67NPR

Engineering Services Survey Expenses Lab. & Test Expenses Consultancy Fee Management & Advisory Service

1,151,354.13 1,827,213.69

2,060.00 5,340,267.63

-

13,650,799.44 72,350.00

750.00 417,057.00 520,000.00

Total 8,320,895.45 14,660,956.44

Sub Schedule-12.3Field Expenses


F.Y. 2066/67NPR

Transportation and Transport Taxes Per Diem/Allowances Field Consumable

224,071.93 722,721.00

16,285.00

235,175.00 286,422.00

21,238.00

Total 963,077.93 542,835.00

Sub Schedule-12.4Vehicle Operation


F.Y. 2066/67NPR

Fuel and Lubricants Insurance Taxes & others Regular Services and Maintenance

395,577.87 124,547.60

84,740.00 98,953.00

65,841.63 1,387.00

17,390.00 -

Total 703,818.47 84,618.63

Amounts in NRs


39

Hydro Consult Pvt. LtdSignificant Accounting Policies and

Notes Relating to the Annual Account

for the Fiscal Year 2067/68 (2010/11)Schedule 14

1. Basis of Presentation

HCPL’s financial statements are prepared in accordance with Nepal Accounting Standard and the prevailing rules of the Company Act 2063 (2006). Except where otherwise stated, they are based on accrual and historical cost convention basis.

2. Capitalization of Fixed Assets

All fixed assets are recorded at cost-less accumulated depreciation. All direct costs relating to the acquisition and installation of fixed assets are capitalized. Office furniture, equipment and vehicles costing less than NPR. 5,000 per unit is charged to the profit and loss account in the year of purchase. 3. Depreciation and Amortization

Office furniture, equipment, vehicles and other assets are depreciated using the diminishing balance method at rates prescribed in the Income Tax Act 2058. Depreciation charge for each period has been recognized in Profit and Loss Statement.

4. Foreign Currency

Transactions in foreign currency are stated in terms using the exchange rate prevailing on the date of transaction. Foreign currency assets and liabilities held in foreign currency on the date of balance sheet are given in Nepalese rupees using the buying rate of Nepal Rastra Bank on that date.

5. On-going Contracts and Projects

Income for on-going contracts are recognised as per the contract agreement with the parties. Expenditure on on-going engineering and consultancy works are shown at cost as Current Work in Progress.

6. Retirement Benefits

Retirement benefits for employees includes a provident fund, a citizen investment trust and a gratuity scheme. Periodic contributions are made to the provident fund and charged to Profit and Loss Statement as Staff cost. Regular employees are elibible for the gratuity after completing continuous three years of service in the company. None of the employees are eligible for gratuity for this year.


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7. Provision for Employees Bonus

In line with the Bonus Act, 10% Bonus is provisioned for the year from the net profit of the year. 8. Previous Year Figures

Previous Year Figures have been regrouped / rearranged as required. 9. Transaction with Related Parties

All transactions with related parties were carried out at arms length. Almost 55% business of HCPL was with the subsidiary companies of Butwal Power Company (BPC). The client Kabeli Energy Ltd., Nyadi Hydro Power Ltd., Khudi Hydro Power Ltd. and Keton Hydro Power Ltd are the subsidiary companies of BPC.

9.1 Details of Transactions with related parties

Name of the company Transaction AmountKabeli Energy Ltd. Feasibility & Detail Design 21,860,568.23 Nyadi Hydropower Ltd Construction Supervison

and Design works 8,318,305.58

Butwal Power Company Ltd For Repair work of Jhimruk and Design of Adhikhola Upgrading

874,597.50

Total 31,053,471.30 10. Schedules

The VAT return and payment missed for the sale of NPR 1,302,764.78 (one million three hundred two thousand seven hundred sixty four and 78/100) on Ashad 31, 2068 was deposited in Mansir in the IRD with the late fee. 11. Schedules

Schedules 1-14 form integral part of the financial statements.

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HydroConsult

Hydro Consult Pvt. Ltd.P. O. Box: 14408 | Pabitra Marga , Buddha Nagar, Kathmandu, Nepal

Tel : +977-1-4782507 | Fax: 977-1-4785920E-mai l : ser v [email protected] | URL: www.bpch.com.np

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